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Rx for cost control Featured

1:05pm EDT May 31, 2002
An increasing number of Americans are crossing international borders in search of a good drug deal.

But these deals are perfectly legal and nothing more than an effort by prescription drug users to decrease their costs for pharmaceuticals.

The cost of widely used drugs continues to increase at double-digit rates, resulting in dramatically higher health care premium costs. And as drug costs rise, they are becoming a larger part of workers' total benefits packages, resulting in pay cuts or a reduction of other benefits as a percentage of total compensation.

Some newly developed drugs backed by expensive advertising campaigns don't have much more effect than drugs that have been successfully used for years. But as a result of advertising, patients are demanding these drugs, and costs are escalating.

If this continues, employers may be forced to decide between raising co-payments and putting in place more restrictive formularies to reduce costs.

While business associations have their say in the nation's capital on health care issues, it may seem there is little an individual company can do to combat rising drug costs. There are, however, ways to decrease drug costs.

The medical staff at UPMC Health Plan offers several suggestions for companies that want to be proactive:

* Have frank discussions with employees about drug costs and their effect on insurance rates, and ask them to always discuss the availability of generic drugs with their doctor. UPMC Health Plan's pharmacy department estimates that doctors switching just 5 percent of prescriptions to generic brands could save about $4.5 million annually in its network alone.

* Encourage employees to become familiar with their insurance company's drug program and discuss these benefits with their doctors. At UPMC Health Plan, for instance, one program sets low co-payments for generic drugs, a slightly higher co-payment for preferred drugs with no generic equivalent and the highest co-payment for nonpreferred brand-name drugs.

* Ask employees to consider using mail-order services when appropriate. These often save money for patients, and the discounts are better than retail pharmacy discounts, which helps employers and health plans manage the premium dollar. Dr. Michael J. Culyba is vice president, medical affairs, for UPMC Health Plan.