Co-payments on Some Generic Drugs to Be Slashed 33 Percent

Patients will soon pay 33 percent less for certain generic prescription drugs that are on the list of state-subsidized medications, Deputy Health Minister Yaakov Litzman announced yesterday.

The reduction in patient co-payments for drugs in the so-called "health basket" of subsidized treatments will apply to generic medications that are subject to commercial competition and whose full price is more than NIS 120. Co-payments on such drugs will drop from 15 percent of the medicine's actual cost to 10 percent.

The change must still be approved by the Knesset Finance Committee, however. It is expected to be submitted to the committee later this month.

The ministry estimates that the change will provide NIS 50 million a year worth of benefits to the public and reduce drug prices for hundreds of thousands of Israelis. Litzman explained at a news conference yesterday that the ministry had discovered extra funds that made the price reduction possible.

But the health maintenance organizations were furious at Litzman's announcement, contending that there are no surpluses. As a result, they said, the move could result in eliminating other medical services.

The Maccabi HMO, for example, said the ministry study that recommended the discount ignored drugs that create losses for the HMOs. Maccabi itself is running a NIS 200 million deficit on medications and therapeutic procedures, it added.

If the change is approved, patients taking the cholesterol-lowering drug Lipitor, for example, will pay NIS 16.61 for a month's supply instead of the current NIS 24.91. Femara, which is prescribed to cancer patients, will cost NIS 62.63 instead of NIS 93.94. The savings will be particularly significant for chronically-ill patients who spend substantial amounts on medications.

The ministry said it discovered NIS 147 million in surplus funding and has allocated about a third of that to reduce co-payments for generic drugs.

"The money that was found stems from [cost] estimates made by the committee that sets the health basket for when new drugs are added to the basket," said ministry Deputy Director General Yoel Lifschitz, who is responsible for overseeing the HMOs. "Over the years, the price of drugs has gone down. Prior to this, the Health Ministry has been accused of not monitoring the process, so we carried out a study and found the surplus."

"The health basket budget is a lot of money," Litzman explained, "and we wanted to find out if there was money remaining in it that could be spent."

He promised to review the situation every year to see if there are surplus funds. "The trend to reduce co-payments will continue," he added.

But previous recommendations for reducing co-payments in the health system have not been implemented. The ministry's head of community medicine, Dror Guberman, for example, advocated a number of cuts in patient outlays, including lowering the maximum payment for families with more than one chronically-ill person, reducing fees for mammograms for the early detection of breast cancer and eliminating dietitians' fees for overweight and chronically ill patients. That proposal was opposed by the Finance Ministry and never took effect.