Co-payments to Fall 33% on Drugs With Generic Equals

The measure should give low-income families greater access to medicines, say sources at the Health Ministry.

Co-payments for certain drugs are to drop by a third in the wake of the approval of a measure introduced by Deputy Health Minister Yaakov Litzman.

The Knesset Finance Committee yesterday approved the plan Litzman had announced in mid-May to reduce patient co-payments for drugs included in the state-subsidized basket of drugs and service that have generic equivalents.

The 33% reduction will come into force on August 1.

The measure should give low-income families greater access to medicines, say sources at the Health Ministry. It is expected to cost the health maintenance organizations about NIS 50 million a year.

A number of surveys carried out over the past several years found that Israelis are forgoing drugs they need, including ones in the health basket, because they can't afford the co-payments. A 2009 JDC-Brookdale Institute survey found that 22% of people defined as low-income, and 18% of the chronically ill, went without medical care or drugs at least once because of the cost of co-payments.

A study by the Taub Institute found that co-payments on health products and services are responsible for pushing 20,000 Israelis below the poverty line every year.

From August, the co-payment on generic drug drops from 15% to 10% of cost. The discount will apply to prescription drugs sold via the HMOs that cost more than NIS 120 and that have commercial competition (from brand drugs ).

For instance, the co-payment on Lipitor, a cholesterol drug, will drop from NIS 24.91 for a month's supply to NIS 16.61. Memorit, an Alzheimer's treatment, will drop from NIS 61.68 per package to NIS 41.12. Femara, to treat breast cancer, will cost NIS 62.63 instead of NIS 93.94.

For patients with chronic conditions who use prescription drugs on a regular basis, the savings could be big.

Surplus funds? Depends who you ask

A study carried out for the Health Ministry by the accounting firm Shiff Hazenfratz & Co. located NIS 147 million in surplus funds from drug procurement budgets. The ministry has instructed the health-care organizations to use these funds to finance the discount.

The health-care organizations have opposed Litzman's moves to reduce co-payments. They dispute the figures on surplus money in drug-procurement budgets. In effect, they claim, they are running a deficit on drug purchases.

Clalit Health Services chief executive Eli Defes went on the attack recently, saying, "The Health Ministry has become populist." He accused the ministry of taking care of the needs only of its own hospitals, and of mounting a concentrated attack on the health-care organizations by means of circulars, procedures and directives for which no budget has been provided. The ministry has been leaving it up to the health-care organizations to find the money to carry out the new decrees, Defes accused.

Coordination between the ministry and the country's kupot holim has been breaking down and could even lead to the health-care organizations' total collapse, Defes said.