The true cost of step therapy legislation

| Amy Prentice

“Cost,” “budget” and “deficit” are words we see or hear almost daily in news headlines. Lawmakers and citizens alike are concerned that our governments are spending too much or not enough, especially when it comes to our health care.  

As lawmakers consider legislation at the federal and state level, one important part of the process is the budget impact. These potential impacts are often viewed through what is called a “fiscal note” or “fiscal impact statement.”  

As the National Psoriasis Foundation (NPF) continues its work to curb step therapy practices through state legislation, we see the question of cost consistently raised. Opposition by health insurance companies and Pharmacy Benefit Managers often cite increased pharmacy and premium costs as the primary reason to defeat step therapy legislation. Because legislators often rely on these types of organizations for data, and because of the overall concern regarding health care costs, we have seen a rise in the use of fiscal notes on step therapy legislation.  

Bills showing a negative budget impact are much tougher to pass. NPF, patient advocates and any supporting party should understand why our legislation saves health care dollars rather than spends them, which data continually shows.  

The hidden costs of step therapy

Take Kansas, for example. The fiscal note stated that our step therapy legislation would could increase annual prescription drug costs to the State Employee Health Plan by approximately $1 million. This, of course, sounds like a legitimate concern, but with the correct information, can be proven to be inaccurate.

It’s important to consider how the long and difficult step therapy process can impact a patient’s ability and willingness to continue treatment. In one study cited in the American Journal of Managed Care in February 2009, researchers found “patients discontinued their medication more so after step therapy was implemented,” and reported an “initial 7.9 percent reduction in days of medication supplied.”

For patients with a chronic disease or life-threatening illness like psoriasis or psoriatic arthritis, it is critical they take their medication consistently. When a patient fails to take their medication because of step therapy and other insurance practices, health care costs increase due to increased hospital stays and medical appointments.

In addition, while requiring a patient to take ineffective therapies for a prolonged period of time as they go through the step therapy process, step therapy can lead to irreversible disease progression, lengthy hospital stays and other harmful side effects. Potential increases in drug costs will be offset (and likely save money) when patients live healthier lives. 

We’re excited to see the successful passage of step therapy legislation in various states across the country because it proves this legislation will not lead to an increase in health coverage or premiums by the patient. In some cases, insurers have even chosen not to oppose this legislation. 

We look forward to continuing these successes and further proving the importance of increasing access to important therapies for all patients. As these successes continue, we will show that ensuring patients receive the treatments prescribed by their doctor will not only increase their quality of life but decrease overall health care spending. 

Amy Prentice is the State Government Relations Manager for the National Psoriasis Foundation.


Driving Discovery, Creating Community

This year, we’re celebrating 50 years of driving efforts to cure psoriatic disease and improve the lives of those affected. See how far we’ve come with this timeline of NPF’s history. But there’s still plenty to do, and we can’t do it without you! Learn how you can help our advocacy team shape the laws and policies that affect people with psoriasis and psoriatic arthritis – in your state and across the country. Help us raise funding to promote research into better treatments and a cure by joining Team NPF, where you can walk, run, cycle, play bingo or even create your own DIY event. Contact our Patient Navigation Center for free, personalized support for living a healthier life with psoriatic disease. And keep the National Psoriasis Foundation going strong by making a donation today! Together, we will find a cure.

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