How much are hospitals marking up the price of medicines? The answer may surprise you.

Hospitals mark up medicine prices, on average, nearly 500 percent, according to anew analysis from the Moran Company that was commissioned by the Pharmaceutical Research and Manufacturers of America (PhRMA). The analysis of 20 medicines also found the amount hospitals receive after negotiations with commercial payers is, on average, more than 250 percent what they paid to acquire the medicine. This means a hospital is paid two and a half times what the biopharmaceutical company, who brought the medicine to market, receives. This hidden threat to affordability is a driver of higher cost sharing and premiums for patients across the country.Insurers pay for medicines administered in hospital outpatient settings differently than when they are purchased at a pharmacy. For example, many cancer treatments are provided in a hospital facility where the hospital purchases the medicine directly and is then reimbursed by the patient ’s insurer – often with a steep markup. How much a hospital can charge for a medicine and what they get paid varies widely based on local hospital and insurer market dynamics. When hospitals gain market power through consolidation, they are able to demand higher reimbursement from commercial pay ers.The Moran analysis evaluated 20 different physician-administered medicines across a range of therapeutic areas, such as cancer, autoimmune disorders and arthritis, and found that hospitals are significantly marking up the prices of these medicines. Even after ...
Source: The Catalyst - Category: Pharmaceuticals Tags: Access 340B hospitals Source Type: news