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Riding the bend in the health cost curve

BY Jim Frederick

Americans and their healthcare plans are spending less on medicines and health services. Is that a good thing?

Researchers for the IMS Institute for Healthcare Informatics posed that question with the release of a report on the U.S. pharmaceutical market this week. But pharmacy leaders, independent and chain pharmacists, the U.S. health system and healthcare advocates are going to be dealing with the implications of that trend going forward.

The IMS report, “Declining Medicine Use and Costs: For Better or Worse?,” tracks a trend that could be with us for a long time. “In 2012, both the per capita use and cost of medicines declined,” noted Murray Aitken, the institute’s executive director. The drop was real and measurable. “Total spending on medicines on a real per capita basis declined by 3.5% in 2012, as a result of declining use of branded drugs, greater availability of lower-cost generics, lower levels of price increases and reduced spending on new medicines,” the report stated.

Even seniors, the group with the highest rates of prescription use, showed small declines in use last year, IMS reported.

As Aitken points out, “For some, this will be good news and a harbinger of more efficient use of our healthcare resources. For others, this decline may indicate under-treatment and imbalance between prevention and care.”

The reasons for the falloff in Americans’ use of medicines and healthcare services are complex, said IMS, “and point to the paradox that while drug costs are actually falling for many patients, their exposure to healthcare costs is increasing.”

According to IMS, “Deductibles and out-of-pocket costs have more than tripled for insured patients in the last five years, while costs for the subset with consumer-driven health plans have gone up seven times.”

At the same time, drug costs are down for many Americans. One big reason: lower-cost generic drugs, which now make up 28% of total drug spending, according to IMS.

Here are a few of the nuggets of information that IMS sifted out of the data stream:

  • The average copay for nearly three of every four prescriptions dispensed at retail in 2012 was $10 or less;
  • Prescriptions for lower-income Americans on Medicaid “cost beneficiaries very little, with 95% costing less than $5 and 99% less than $10,” noted IMS;
  • Patients covered by commercial, for-profit health plans “face a higher medicine copayment cost than other insured patients,” according to the report, with copays for branded drugs typically costing those patients $20 or more.

The bending downward of the medication cost and utilization curve is sure to ripple through the pharmacy profession and the vast healthcare network it supports. And it comes “as we sit on the eve of arguably the most transformative period in healthcare,” according to Aitken.

Please share your thoughts about what the decline in medicine use means for patients and pharmacy. As always, your comments are appreciated.

 

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NPD study: Kids, teens heaviest snackers; Women outpace men

BY Jason Owen

CHICAGO — The typical American eats more than 1,000 snack-oriented convenience foods throughout the year, and kids and teens are the heaviest users of this assortment of snacks, which includes fresh fruit, sweets and savory snacks, according to a recent study by The NPD Group, a global information company.

The study also found women eat on average 3.1 snack-oriented convenience foods a day compared to the 2.7 snacks men eat a day.

About eight of every ten in-home snack food eatings are considered to be a snack-oriented convenience food versus other foods, regardless of time of day, finds NPD’s SnackTrack, which continually monitors the consumption of snack-oriented foods both in-home and away. During a typical year, there are over 356 billion eatings of snack-oriented convenience foods.

Among the top ten motivators for selecting a particular snack are: “like the taste,” “was hungry,” “had a craving,” “favorite snack,” and “was simple and easy to eat,” according to SnackTrack. While taste is the leading motivator across all age groups, women are more likely to select snack foods to satisfy specific expectations (i.e. chocolate, sweet, crunchy, healthy) while kids’ favorite snacks are simply fun to eat. Fresh fruit, chocolate, potato chips, cookies, and yogurt are, in rank order, the top five snack-oriented convenience foods consumed annually.

“An individual’s mood and situation has a strong effect on what will be snacked on,” says Darren Seifer, NPD food and beverage industry analyst. “Connecting your marketing messages to the emotional nature of snacking — think taste, cravings and indulgence — will help drive your product’s selection.”


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SC Johnson introduces compostable Ziploc bags

BY Jason Owen

RACINE, Wis. — SC Johnson announced last week in conjunction with the company’s continued sustainability efforts a new line of Ziploc compostable sandwich bags.

"At SC Johnson, part of our sustainability efforts include making innovative, effective household products that are better for the environment and future generations," says Kelly M. Semrau, senior vice president of Global Corporate Affairs, Communication and Sustainability at SC Johnson. "The introduction of our new Ziploc Brand Compostable Bags is an extension of that commitment and we are proud to make products that have a positive impact, without compromising the quality that our consumers expect."

Ziploc Compostable Bags are available in three sizes:

  • Ziploc Brand Compostable Sandwich Bags: $5.27 each (includes 20 sandwich bags);
  • Ziploc Brand Compostable Food Storage Bags: $5.27 each (includes 15 quart-sized storage bags);
  • Ziploc Brand Compostable Food Scrap Bags: $9.00 each (includes 20 2.6-gallon food scrap bags).

All three bag types are certified compostable under ASTM D6400 by the Biodegradable Products Institute. They can be composted in commercial composting facilities that accept food scraps and compostable bags. Check locally to see if such a facility exists in your community as these facilities do not exist in many areas, by visiting FindaComposter.com. Ziploc Brand Compostable Bags are not suitable for backyard composting because they are less efficient than commercial composting facilities, which are designed to ensure proper conditions for the ideal compost, the company stated.


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