Savings to medicines reimbursement seek fairest solution

27.2.2012 7.18
News item N5-59217

"Our pharmaceutical reimbursement system is currently being reformed, in line with the stated objective of the Government Programme. The aim is that the proposal concerning this structural readjustment will be ready by the end of the year," says Director General Outi Antila, who heads the working group on medicines' reimbursements.

In Finland patients can be reimbursed by the Social Insurance Institution for the price of prescribed pharmaceuticals, which is deducted from the cost of medicines bought in pharmacies. Pharmaceutical companies are able to set the prices of medicines, which may be prescribed once the Finnish Medical Agency approves them.

€113 million target

Patients receive reimbursements according to a special or basic reimbursement status. The Pharmaceuticals Pricing Board determines the reimbursement status of prescription medicines. The current government programme aims for a revision of the medicine reimbursement expenditures under the statutory health insurance system so as to achieve €113 million savings in government finances.

The working group was set up last November to consider the development of the whole system of medical reimbursements. Proposals on this are due by the end of this year. The working group comprises a broad representation from authorities and institutions involved in pharmaceutical matters, the pharmaceutical industry, pharmacy sector and patients' representative organizations.

Fine balance

But the working group's initial urgent task was to find a way to reach the savings envisaged by the government programme, the recommendations on which were submitted in mid-February with a view to their being implemented from the beginning of 2013.

The intention is to achieve a fine balance that achieves savings while ensuring that the people who require abundant prescribed medicines continue to benefit most from reimbursements, and that people on low incomes remain able to access pharmacotherapy.

"The savings package will not impact the reform of the whole system but its preparation will be pursued continuously. The issue of costs will also be reviewed in connection with the structural changes," says Antila.

The costs of prescription medicines paid to patients out of sickness insurance take the form of either basic or special reimbursements. In practice the reimbursement is deducted from the cost the medicines patients pay for at pharmacies.

The basic reimbursement is 42 percent of the price. The proposal of the working group is that this would drop to 32 percent. The prices of drugs subject special rates of reimbursement are covered for either 72 percent or 100 percent of the price. The working group proposes that the upper level would remain in place while the lower level would drop to 65 percent.

Softening the impact

The proposals pay particular attention to the situation of people who have to use medicines routinely. The proportion that patients have to pay for medicines has a cut-off point, which is determined each year, and which is about €700 for 2012. The working group proposes that this should drop by €50.

Antila points out that the impact of the savings on two thirds of users of prescription medicines will be less than €10 a year, and for 95 percent of patients the sum will be less than €50. Antila points out that though the changes achieve savings the outcome represents an improvement for some patients. "Many people who use medicines will benefit because we propose a lowering of the upper limit of the sum they are liable for to €50. Thereduction in the wholesale price of medicines will also benefit everyone who buys them.

Under the working group's proposals some two percent of people who purchase medicines will surpass the €50 limit in additional costs. This group includes people whose medication is somewhat pricy nut not so much that the costs would exceed the amount for which they are liable.

The least bad model

In Antila's view it woule be impracticable to use an income-related means test in this situation "It would require creating an income-related reimbursement system or self-liability ceiling, which would entail checking people's tax data in relation to the purchases they make from pharmacies. An earnings-related system would also require scaling, which always entail income traps and those who are left out."

One option discussed by the working group was that each prescription should have a self liability rate. Instead the working group decided to propose a percentage reduction of the reimbursements, as this would take better account of people on low incomes. This was felt to be the least problematic alternative, though it was clear that there was no perfect solution to the issue. "All alternatives involve problems. We tried to select the least bad model," says Antila.

Accelerating costs

Medicine reimbursement costs are nowadays about three times what they were 20 yeaqrs ago. Though the growth in expenditure leveled off in the 2000s, in particular due to the use of generic substitution and the reference pricing system, increasingly more new and expensive drugs are coming onto the market. The government currently pays for half of medicine reimbursements, which amount to €1.2 billion. The other half accrues from salaries, pensions and health insurance benefits.

Antila says that the savings package proposed by the working group will alter this equation. "The state will save on expenditure, and the sum to be accrued from wage earners and benefit recipients will remain the same in terms of Euro amounts. The previous cost share will become 47/53. Employee organizations view the change of considerable importance, and so the reform is only intended to be a temporary measure."

Antila says that the working group, with is broad composition, agreed unanimously that the saving had to be distributed as evenly as possible among the various players. "Lowering the reimbursement percentage will hurt those who have to buy medicines, while the drop in the wholesale price impacts on the pharmaceutical industry and pharmacies. We think that this is the fairest solution."

Paula Mannonen and Mark Waller