Faced with the rising costs of generic prescription drugs, health insurers increasingly are turning to tiers and preferred lists on their formularies to keep costs down. Those strategies previously were used only for brand-name and specialty drugs. Experts say those approaches will increase out-of-pocket costs for patients and could make them less likely to adhere to drug regimens.
Over the past year, the cost of generic drugs has skyrocketed, including for products that have been on the market for years. A study by Pembroke Consulting found that half of the generic drugs listed rose in price between July 2013 and July 2014, with a median increase of nearly 12%. Some drug prices saw extreme increases. The price for a 500- mg capsule of tetracycline, a common antibiotic, soared from 5 cents to $8.59.
Experts say a combination of lack of government oversight over generic pricing, manufacturers exiting the generic market, and shortages of active ingredients have contributed to the increases. This month, Rep. Elijah Cummings (D-Md.) and Sen. Bernie Sanders (I-Vt.) sent letters to 14 generic-drug makers seeking explanations for price increases.
