AHIP CEO Ignagni: “No Blank Check” for High Drug Costs

America’s Health Insurance Plans CEO Karen Ignagni challenged the economic viability of high drug costs at The Atlantic Forum on the Future of Medicine. Her remarks were published on YouTube May 21, 2014:

The reality is that the company in this case is asking for a blank check, and we can’t give anyone anymore a blank check in the health care system – whether it’s a pharmaceutical company, a hospital, a device manufacturer […] because it will blow up family budgets; it will blow up state Medicaid budgets; it will blow up employer benefit costs; and it will wreak havoc on the federal debt. So we now have to step back and say, is the hallmark of innovation higher pricing

CCOs are struggling with covering a newly approved regimen for Hep C, which runs about $84,000 per treatment at $1,000 per day for 13 weeks. While the treatment is covered, the benefit is not yet included in the actuarial data that goes into the Medicaid premium. In other words, the state isn’t yet providing any money to pay for it.

While commercial plans can negotiate a discount for the drug, CCOs don’t have the same flexibility. Put it all together and drug costs are one of the greatest concerns facing CCOs and other Medicaid plans nationally.