Why prescription drug access should be treated as a racial justice issue | Opinion
The past 18 months opened many Americans' eyes to the ways racial inequality affects health. Throughout the pandemic, Black and Hispanic people have died from COVID-19 at higher rates than their white neighbors. And public protest shone a light on the disproportionate impact of police violence on Black people.
There's a growing awareness of the many reasons people of color experience poor health outcomes, including the stresses of racism itself. But one area of racial health disparity isn't often discussed: the lack of equitable access to prescription drugs.
Despite persistent health inequities, we still have systems in place that constrict drug access for historically marginalized groups. This includes policies that were originally intended to help these very same folks.
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Pharmacy Benefit Managers, for instance, make up a significant part of the opaque and exploitative dimension of our drug-pricing system. These companies have been around since the 1960s, when they were created to help insurers contain drug spending. At the time, PBMs were independent companies whose interests aligned with helping patients. But following a wave of mergers and acquisitions, today the three largest PBMs control 89% of the market. Of those three, one, CVS Caremark, is owned by a drugstore chain and another, OptumRx, by a health insurer.
PBMs negotiate for rebates with drug companies, savings that are supposed to be passed on to consumers. But they aren't required to report what percentage actually goes to reducing out-of-pocket costs. Rebates from drug companies to PBMs doubled between 2012 and 2016, when they totaled nearly $90 billion. Common sense suggests that this huge increase should have dramatically reduced what patients pay -- but instead, out-of-pocket drug costs continue to rise.
One solution would be to require PBMs to make the discounts they negotiate public. If they're pocketing savings that could have otherwise reduced out-of-pocket costs, patients have a right to know.
To this end, in February 2019, Senate Finance Committee Ranking Member Ron Wyden, D-Oregon, introduced the Creating Transparency to Have Drug Rebates Unlocked (C-THRU) Act. The bill would bring much-needed transparency to these drug price negotiations and ensure patients get their fair share of the savings.
It would do so in three key ways. First, the C-THRU Act would require PBMs to disclose the value of the rebates they receive from pharmaceutical companies. After two years of reporting those discounts, the bill would require PBMs to pass a minimum percentage of the savings onto insurance plans, which would help to lower patient premiums.
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The legislation would also use the drug price negotiated by PBMs to determine the cost Medicare Part D enrollees will pay out of their own pocket. Currently, that cost is based on the manufacturer's list price for a drug -- not the discounted price PBMs negotiate.
For the sake of Americans of color, these measures must be included in the spending bill making its way through Congress.
The proposals would help to lift the burden of high prescription drugs costs, which are particularly prohibitive for patients of color. Black Americans, for example, earn about half as much as their white counterparts. As a result, nearly a third of Black patients report not taking their medications correctly due to cost concerns. Only about a quarter of white patients report the same.
At this critical moment, congressional action is needed to identify and reform any perceived misaligned incentives or anti-competitive practices by all actors in the healthcare supply chain. Without requiring greater accountability Congress's spending package falls short of meaningful, comprehensive drug pricing reform.
Fixing programs like this alone won't solve the inequities that plague U.S. healthcare. But addressing its shortcomings through meaningful reform would be a good start. By focusing on what has worked and what hasn't, we can build a better, healthier future for America's people of color.
Kevin B. Kimble, Esq., is the founder and executive director of the Southern Christian Leadership Global Policy Initiative.
This article originally appeared on Nashville Tennessean: Racial disparities arise in prescription drug access
