The Value of Generic Medications
What medications are safe, effective, approved by the U.S. Food and Drug Administration (FDA), and less expensive than brand-name ones?
The answer may surprise you.
Generic medications have to meet the same FDA requirements as their brand-name counterparts for effectiveness, and remain a great way to offset rising health care costs. Unfortunately, their true value is often overlooked. This section gives you an in-depth look at the challenge of rising medication costs and how generics can help.
What's the Link?
For most Americans with health insurance, the cost of prescription medications is covered by a simple copayment. Since this copayment is much less (in most cases) than the actual cost of the medications, many consumers don't think twice when their doctors prescribe them. Unfortunately, these costs continue to add to overall health care inflation.
To fight this inflation, today's employers and health plans must carefully balance cost and quality.
Rising Medication Costs: The Root of the Problem
Throughout the last two decades, prescription medication use has continued to rise. We now use prescription medications to treat everything from allergies to heart disease. Pharmaceutical companies have responded to this demand with a seemingly endless variety of new brand-name products. While these medications can improve our quality of life, they also drive increases in the cost of health care, and increases make quality care more difficult to afford.
At the same time, legislation has allowed drug companies to extend their patents on brand-name medications to 20 years. Other drug companies must wait for these patents to expire before they can produce and sell generic versions at a lower cost.
In addition, regulations governing brand-name medication advertising have slackened. This has fueled the extensive marketing campaigns we have all seen on television and in magazines. As consumer awareness for these brands continues to grow, so does the demand for these more expensive prescriptions. Yet at the same time, generic medications save consumers billions of dollars each year at retail pharmacies.
Want to Help Keep Costs Down?