Insurance plans are covering fewer drugs, and the drugs they do cover are becoming more expensive to consumers, a new report finds.

The report, by GoodRx, an online site that provides information on drug discounts, said that consumers face a "Big Pinch" when it comes to filling prescriptions: formularies are shrinking at the same time that insurance plans are pushing more costs to consumers, in the form of copays and deductibles.

The study looked at prescription drug coverage from more than 3,500 Medicare part D plans, from 2010 to 2019, and found that, on average, the share of drugs covered dropped by 17 percent from 2010 to 2019. "Compared to 2010, when an average plan covered 73 percent of prescribed drugs, in 2019 just 56 percent of drugs were covered by the average part D plan," the report said. The report noted that commercial insurance plans often mirror the trends of Medicare coverage.

In addition, deductibles have been rising—and an increasing number of plans have deductibles that apply only to prescription drugs. These pharmacy deductibles are also on the rise: 44 percent of plans now have pharmacy deductibles, compared with only 14 percent of plans six years ago.

A spike in drugs dropped by PBMs

The report outlined a recent increase in the number of drugs dropped by pharmacy benefit managers (PBMs). In the three years between 2015 and 2017, the number of drugs dropped by PBMs averaged around 48 drugs per year. In 2018, that number jumped to 82, and in 2019, PBMs dropped 91 drugs from their formularies. (The report noted that PBMs don't disclose what drugs they add or the total number of drugs they cover.)

"Patients are left with few options when their drug is dropped from coverage," the report said. "Some patients can switch to an affordable, or covered, alternative. But others who do not have an effective alternative are compelled to pay out of pocket for their medication—often a full cash price that can cost hundreds if not thousands more than a copay."

More restrictions on covered drugs

PBMs are also placing more restrictions on drugs they do cover. Quantity limits, step therapy, prior authorizations, and refill-too-soon limits are some of the restrictions mentioned by the report.

"The use of these restrictions has increased substantially in past years," the report said. "Between 2010 and 2019, the average number of drugs in Part D plans with restrictions has increased by 16 percent, from 26 percent of drugs in 2010 to 42 percent of drugs with some form of restriction in 2019. In other words, nearly half of all medications covered by Medicare plans have a restriction."

Cost-sharing on the rise

In addition to dropped coverage and restrictions, the GoodRx report noted the increase of consumer costs via copays and deductibles.

"While deductibles are a common cost-sharing tactic (80 percent of workers have some form of deductible in their plan), high-deductible health plans are becoming increasingly more common,' the report said. "Any plan with a deductible of more than $1,350 for a single enrollee or $2,700 for a family is considered a high-deductible health plan, and now, nearly half of Americans with employer-sponsored insurance are enrolled in one."

Copays, where consumers are required to pay some part of the cost of the prescription, is also on the rise. The report noted a Takeda Pharmaceuticals study, which found that from 2010 to 2018, average copays increased by about 30 percent for commercial insurance plans.

The report warns that the combination of these trends is leading to a dysfunctional health care system. "Cost-management tactics have reached a point where it is common for patients to find that their necessary drug is no longer covered, or that there are more restrictions inhibiting coverage for the drugs they take," the report concludes. "In addition, prior authorizations, step therapy, and other restrictions delay treatment, and high costs lead to patients skipping or putting off taking their medications. All of this leads to sicker patients and higher healthcare expenses for the country as a whole."

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Instant Insights /

Consumers' drug choices decreasing, prices increasing

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