Health insurance premiums in Colorado and the rest of the country are expected to increase by at least 10% in 2007, driven mainly by the cost of expensive specialty drugs.
An article I just read from the Associated Press (published by the Insurance Journal) said that specialty drugs accounted for 19 %, or about $40 billion worth of pharmaceutical spending last year. Express Scripts, a company that manages prescription programs, estimates that by 2009, that $40 billion figure will inflate to $90 billion, as new drugs and treatments emerge.
Specialty drugs: Biotechnology treatments involving genetic engineering, unique treatments for rare diseases, cancer medications that have to be administered in medical facilities and other high-cost treatments.
Matthew Connell, the senior director of pharmacy services for Blue Cross and Blue Shield of Mass., told the Boston Globe, “The specialty drug slice of the pie is growing fast. It’s only about half of one percent of all pharmacy [prescriptions], but it accounts for as much as 13 percent of pharmacy costs.”
According to the AP, health insurance companies, have, in the past, cited the rising costs of prescription drugs, higher costs from doctors and imaging technology for the increase in health insurance premiums. This is the first time they’ve included specialty drugs into the contributing factors.
Insures are trying to hold down the cost of health insurance premiums by taking efforts to control the use and cost of specialty drugs, reports the AP. Such efforts include requiring physicians to obtain permission before prescribing specialty drugs and barring the prescription and use of drugs not approved by the Food and Drug Administration (FDA).
This is a great example of why you don’t want to have one of the ever increasing number of Colorado health insurance policies with generic prescription drug coverage only, or one with none at all.