When getting medications, Independence members may occasionally use a prescription drug voucher card to lower out-of-pocket expenses. However, these cards may not actually contribute toward long-term savings. It is important to understand what these cards are and when they can help members save money.

What is a prescription drug voucher?

A prescription drug voucher is typically offered by pharmaceutical companies that manufacture brandname or specialty medications. These vouchers can be taken to a pharmacy and used to lower or eliminate a member's insurance copayment or out-of-pocket cost for a prescription medication. The pharmaceutical company covers the cost of reducing the copayment. Many of these vouchers are available on the Internet or at the physician's office. They prove to be especially beneficial for members in scenarios where all other prescription drug alternatives are also high cost brand-name or specialty products.

Potential issues with use

Generally, generic medications have the lowest copayment and brand-name medications have the highest copayment. Independence uses cost-sharing to direct patients to more cost-effective medications, such as when generic alternatives are available. We design formulary tiers and copayment cost-sharing to encourage price competition and reduce drug costs. These tiers are designed as an incentive for members to choose clinically appropriate medications with the lowest net cost.

Prescription drug vouchers may discourage members from choosing the least costly, most clinically appropriate medications. When pharmaceutical companies offer prescription drug vouchers, they reduce or eliminate the higher copayments associated with their brand-name or specialty medications. This narrows the copayment differential between the generics and brands and may encourage the patient to go with the brand-name medication. Despite the lower copayment, the gross cost of the drug remains unchanged because the insurance company's cost still applies.

As brand-name medication utilization increases, the insurance company's overall costs also increase. This may ultimately affect the premium insurance companies charge to offset expenses. According to the Pharmaceutical Care Management Association, the use of prescription drug vouchers will increase the prescription drug spending for commercially insured patients by $32 billion over the next ten years. This will inevitably increase health insurance premiums for all parties. It is important to understand that even though a patient's prescription may cost less that month, it may ultimately raise overall health care costs.

How you can help

It is important to understand how prescription drug vouchers work before accepting them from pharmaceutical companies and distributing to patients. It is also important to remind patients of the potential downstream effects of these vouchers when seeking savings opportunities for their prescription drugs.