CVS partnership may drive down healthcare costs
WHAT IT MEANS AND WHY IT'S IMPORTANT CVS Caremark’s Behavior Change Research Partnership with several leading universities is likely to yield some invaluable results for the industry at large because if CVS Caremark executives and the participating academic leaders can better understand customer behavior and develop ways to encourage improved healthy behaviors, then the end result likely will be lower healthcare costs.
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How will it lower costs? Through improved medication adherence and increased generic utilization.
Understanding why many patients fail to adhere to their prescription medication regimen and developing ways to effectively change their behavior is a major step toward eradicating this multi-billion dollar problem. It has been widely reported that non-adherence to essential medications is a frequent cause of preventable hospitalizations and patient illness, with costs to the U.S. healthcare system estimated at a whopping $300 billion annually.
Furthermore, a Wolters Kluwer Health study found that, in looking at U.S. commercial plan claims for 2008, prescription abandonment rose by 34% nationally compared with 2006 -- jumping from an average of 5.15% in 2006 to 6.8% in 2008. The data also revealed that abandonment increased as the amount of the co-pay increased, especially for new prescriptions. Interestingly, this last fact leads into the second part of CVS Caremark’s Behavior Change Research Partnership: Why is it that when patients do take get their prescriptions filled some still opt for the pricey brand name when cheaper generic versions are available?
With price sensitivity being such a major factor in lack of adherence it is important to find out why some patients aren’t willing to take generic versions that may provide identical or similar health outcomes as the brand name drug. And with so many medications -- especially blockbusters in major therapeutic areas like cholesterol reducers -- coming off patent in the coming years the volume of generics will increase so it is critical to better understand consumer behavior as it relates to generics.
That’s not to say that generic medications haven’t made some significant headway in recent years. The Wolters Kluwer Health analysis found that generic medications continue to make gains over brands by grabbing more than 60% of all U.S. prescriptions filled in 2008. According to the data, there were 2.4 billion prescriptions filled for generic drugs versus 1.4 billion for brand-name medications.
This growth in generic medications has been driven, in part, by patient education programs and $4 generic drug programs.
Clearly, further research on consumer behavior and their opinion of generics medications will unlock additional opportunities and, at the end of the day, help curb healthcare costs.