I’ve got a drug problem—actually, we all do, at least those of us in the United States: We’re spending too much on prescription drugs when compared to other developed nations. 

Though the increasing use of generic drugs helps contain medication costs, according to one study, the United States spends twice as much on prescription drugs per person vs. the average of comparable countries such as Germany, Canada, Japan and the United Kingdom. This amounts to $966 per capita vs. $466.¹ When these high prices hit government programs like Medicare, they put increased pressure to try to save money in other areas—or take away resources that might be better spent elsewhere. However, there are signs that our situation may be changing for the better.

In late September, Medicare put the word out that it was looking to hire nearly 100 new employees to staff its Medicare Drug Rebate and Negotiations Group. The new unit will be tasked with negotiating prices for 10 expensive medications, and is looking for individuals with experience in economics, data science and pharmaceuticals.² Sitting down at the bargaining table with drug manufacturers in order to negotiate fair prices for drugs would be a first for the United States, while other countries have been doing it for years. 

The other, possibly even more intriguing, development on this front happened in mid-August: Blue Shield of California, which insures nearly 4.8 million people, announced that it was dropping CVS Health as its pharmaceutical benefit manager. Instead, the non-profit insurer is going to partner up with five other services, including Mark Cuban’s Cost Plus Drugs company and Amazon. Blue Shield says it reached its breaking point when it found a $160 version of a cancer drug that normally would sell for $3,000, but CVS pushed back on them, refusing for five months to sell it at the lower price.³ Now that Blue Shield of California is out from under CVS’ thumb, the insurer estimates it can save around $500 million each year when the plan kicks off in 2025.

Circling back to ophthalmology, this renewed interest in controlling rampant drug prices will be an instance of “a rising tide lifts all boats” or, in this case, “falling prices lift the target from your back”: In addition to keeping your patients from having to decide between food and their prescriptions for the month, negotiating drug prices will also help lessen the constant drum beat of reimbursement cuts for your ophthalmic services. If/when the country is able to save possibly hundreds of millions of dollars thanks to lower drug prices, Medicare may call off the dogs sniffing around to take another 3-percent bite out of your bottom line.

— Walter Bethke
Editor in Chief

^{1. Peter G. Peterson Foundation. How much does the United States spend on prescription drugs compared to other countries? https://www.pgpf.org/blog/2022/11/how-much-does-the-united-states-spend-on-prescription-drugs-compared-to-other-countries. Accessed October 2, 2023.}

^{2. Walker J. Uncle Sam wants you—To fight high drug prices. WSJ. https://www.wsj.com/health/pharma/uncle-sam-wants-youto-fight-high-drug-prices-42b3edee?mod=health_lead_pos5. Accessed September 25, 2023.}

^{3. Santija B, Wingrove P. Blue Shield of California looks to cut reliance on CVS, taps Amazon. Reuters. https://www.reuters.com/business/healthcare-pharmaceuticals/blue-shield-california-drop-cvs-caremark-pharmacy-benefit-manager-wsj-2023-08-17/. Accessed October 2, 2023.}