For years, health insurance companies have encouraged patients to choose generic drugs because they were less expensive than their brand-name counterparts, but over the past year the cost of generic drugs has, in some cases, increased as much as 17,000%.
What Causes Rising Generic Drug Prices
Lack of government oversight over generic pricing may be to blame. Some believe that lack of competition among generic manufacturers and shortages of active ingredients have contributed to the sharp price increases.
Insurers Respond to Higher Generic Costs
Some health insurance companies say they will start capping co-pays for generics at $4, $6, or $8 starting in January, 2015. Other insurers say they will require members to pay higher co-payments for higher priced generic drugs, or plan to do nothing to limit the rising cost of generic drugs, which may cause patients of modest income to simply stop getting their prescriptions filled or take less of the medication than is prescribed by their doctors.
Congressional Inquiries into Rising Generic Prices
In October 2014, Rep. Elijah Cummings (D-Md.) and Sen. Bernard Sanders (I-VT) sent letters to 14 drug makers that make or distribute generic drugs, requesting explanations for price increases. Responses to the inquiries could lead to congressional hearings.
Sen. Sanders said in a written statement that “generic drugs were meant to help make medications affordable for the millions of Americans who rely on prescriptions to manage their health needs. We’ve got to get to the bottom of these enormous price increases.”