NORD supports policies that reduce patient out-of-pocket expenses on prescription drugs to enable better access to the therapies rare disease patients need.
Innovative treatments and scientific advancements are allowing many patients with rare diseases to live longer, healthier lives. Unfortunately, the cost of these medications and treatments can be high, making them out of reach for many in need of care. NORD recognizes that the high cost of drugs has a direct impact on patient access and therefore advocates for policies to lower patient out-of-pocket expenses and maximize access to needed therapies.
Trends in out-of-pocket prescription drug spending and regulation
A patient’s out-of-pocket costs include their expenses for medical care and treatment that are not reimbursed by their health insurance plan. These can include:
For many rare disease patients, out-of-pocket costs have grown significantly in recent years, as employers and insurance companies are increasingly shifting the cost of health care onto patients by raising premiums, deductibles, and changing plan design.1 These actions can have serious consequences for patients. Exorbitant out-of-pocket costs can force patients to go without their medication or use alternative treatments that are not as safe and effective. For example, according to a 2023 poll conducted by KFF (formerly the Kaiser Family Foundation), 28% of adults report difficulty affording their prescription drugs.2 Of those who were unable to afford their drugs, 3 in 10 say they have not taken their medicine as prescribed due to cost.3
In recent years, Congress and state legislatures have been exploring different ways to assist patients with increasingly high prescription drug out-of-pocket costs, with varying and to-be-determined impacts on a patient’s out-of-pocket spending. For example, in August 2022, President Biden signed into law the Inflation Reduction Act which will limit the out-of-pocket prescription drug costs for Medicare Part D beneficiaries to $2,000 annually. This change goes into effect in 2025 but is only applicable to Medicare beneficiaries who participate in the Part D program.4 Additionally, as of November 2024, eight states have established Prescription Drug Affordability Boards (PDABs) to try to address prescription drug costs, but the impact on patient out-of-pocket costs in those states has yet to be determined as these PDABs are still being implemented.5
It is important to note that state lawmakers do not have authority over all forms of health insurance, but for the purposes of this report, this analysis of out-of-pocket cost protections focuses solely on state-regulated health insurance plans.
1. 2023 Employer Health Benefits Survey, (2023, Oct 18). KFF. https://www.kff.org/report-section/ehbs-2023-summary-of-findings/
2. Kirzinger, A., Montero, A., Sparks, G., Valdes, I., and Hamel, L., (2023, Aug 21). Public Opinion on Prescription Drugs and Their Prices. KFF. https://www.kff.org/health-costs/poll-finding/public-opinion-on-prescription-drugs-and-their-prices/
3. Ibid.
4. Cubanski, J., Neuman, T., & Freed, M. (2022, Sep 22). Explaining the Prescription Drug Provisions in the Inflation Reduction Act. KFF. https://www.kff.org/medicare/issue-brief/explaining-the-prescription-drug-provisions-in-the-inflation-reduction-act/
5. Datar, S., and Kikora, K. (2023, Aug 15). States Turn to Drug Price Boards to Reduce Spending. Avalere. https://avalere.com/insights/states-turn-to-drug-price-boards-to-reduce-spending
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