|Implemented in this survey?|
Since 2007 health insurers have been developing a drug preference policy. The essence of this policy is that they negotiate directly with pharmaceutical companies on the price of generic drugs. They have been able to achieve considerable price discounts.
A cornerstone of the current market reform is that health insurers negotiate with healthcare providers on the price and quality of health services. They now also do so in pharmaceutical care by negotiating with pharmaceutical companies on the price of generic outpatient prescription drugs with an equal chemical substance (e.g. cholesterol lowering drugs, anti-hypertension drugs, stomach-acid inhibitors).
They only reimburse the costs of the lowest priced drugs in each category (called preferred drugs). Patients who for medical reason need another than the preferred drug can apply for a non-preferred drug the costs of which will be fully reimbursed if that drug is on the list of drugs covered by the basic health insurance scheme.
The insurers' drug preference policy has significant consequences for the revenues of pharmacists delivering outpatient prescription drugs. Until recently, each pharmacist negotiated a discount for generic drugs. The difference between the price negotiated and the standard price paid by the insurer was a substantial part of a pharmacist's revenues (income). In addition, they were paid a standard remuneration for each outpatient prescription. This remuneration is not affected by the insurers' drug preference policy.
The prime objective of the insurers' drug preference policy is to save costs in outpatient pharmaceutical care. The policy is expected to have a beneficial impact on the premiums people must pay for their health insurance. One big insurer (market share about 25 percent) recently announced that patients who use preferred drugs are exempted from paying the mandatory deductible (€155 a year). By this arrangement, a patient using preferred drugs can benefit in particular from the insurers' drug preference policy.
A distinction must be made between incentives for patients and the pharmaceutical industry.
Patients have a financial interest in taking preferred drugs because they do not get reimbursed the costs of non-preferred drugs (unless they need a non-preferred drug for medical reasons). In addition, they can now benefit from the new arrangement according to which they are exempted from paying the mandatory deductible in outpatient pharmaceutical care.
Producers of generic drugs must compete with each other for contracts with health insurers. Contracts apply only for a restricted period of time (e.g. half a year). Missing a contract will lead to a considerable loss of business during the contract period.
Physicians (are expected to prescribe preferred drugs), patients, pharmacists, producers of generic outpatient prescription drugs
|Degree of Innovation||traditional||innovative|
|Degree of Controversy||consensual||highly controversial|
|Structural or Systemic Impact||marginal||fundamental|
|Public Visibility||very low||very high|
Interesting development in line with the ongoing market reform.
The insurers' preferred drugs policy fits into the market reform in Dutch health care. A cornerstone of this reform is that health insurers should no longer passively pay the costs of health care rendered to their subscribers. Instead, they should negotiate on behalf of their subscribers with healthcare providers on the quality and costs of health care.
Their preferred drug policy is a rather successful example of the new role they have been assigned in the market model of health care (successful from the perspective of expenditure control in pharmaceutical care). Therefore, the Minister of Health took some regulatory measures to enable and encourage insurers to develop a drug preference policy.
|Implemented in this survey?|
The preferred drug policy is an initiative of health insurers. They believed that they could manage to achieve significant cost reductions by directly contracting with pharmaceutical companies on the prices of outpatient prescription drugs. Together with many others, including the Minister of Health, they also believed that the previous system in which each pharmacist negotiated with pharmaceutical companies on price discounts was only beneficial for the pharmacists themselves. The difference between the price charged by the pharmaceutical company and the standard reimbursement paid by health insurers had always been a sizeable source of revenues to pharmacists, despite policy measures of the Minister of Health to skim these revenues (the so-called claw-back measures).
Since the early 1990s the revenues of pharmacists come from two sources. They were paid a standard and uniform reimbursement for each outpatient prescription. As an additional source or income, they were permitted to retain the difference between the standard price paid by the insurers and the market price charged by the pharmaceutical company.
The approach of the idea is described as:
Else - No, but phased introduction taking place this year.
The preferred drug policy is an initiative of the insurers. Pharmacists are very much opposed because of the dramatic loss of revenues they expect. Some pharmacists did already close their business and others expect bankruptcies. In a recent report, the Netherlands Healthcare Authority confirmed the substantial loss of revenues of pharmacists, but it nevertheless did not consider it necessay to raise the standard remuneration per outpatient prescription. Based on this report, the Minister of Health refused to raise the standard remuneration
|Government||very supportive||strongly opposed|
|Parliament||very supportive||strongly opposed|
|Pharmacists||very supportive||strongly opposed|
|physicians||very supportive||strongly opposed|
|Insurers||very supportive||strongly opposed|
|Association of patients with chronic illness||very supportive||strongly opposed|
|Private Sector or Industry|
|Wholesalers||very supportive||strongly opposed|
|Pharmaceutical companies||very supportive||strongly opposed|
Only insofar the Minister of Health has taken some measures to enable health insurers to set up a drug preference policy and to put it into practice.
|Association of patients with chronic illness||very strong||none|
|Private Sector or Industry|
|Pharmaceutical companies||very strong||none|
There are indications that the policy is successful. Insurers have managed to reduce the prices of outpatient prescription drugs, in some cases even to 90 percent. The Health Insurance Board found that the costs of pharmaceutical care grew by only 2,6% in 2008 compared to 8.4% in 2007. It explained this drop by referring to the insurers' preferred drug policy.
The insurers' drug policy has been successful from a financial perspective.
Nevertheless, patients with chronic illness may encounter problems. They may be forced to switch to another preferred drug after the ending of the contract period, if the insurer contracts another provider for the delivery of generic drugs. Asking for reimbursement of a non-preferred drug for medical reasons causes additional bureaucracy for doctors and patients.
Another problem may the accessibility of pharmaceutical care. The Minister of Health has declared that he will closely monitor the accessability of phrmaceutical care. But he also believes that efficiency gains in the pharmaceutical column are possible without impairing accessibility.
|Quality of Health Care Services||marginal||fundamental|
|Level of Equity||system less equitable||system more equitable|
|Cost Efficiency||very low||very high|