Health Policy Analysis

Published: 2021/12/02
Number of words: 1655

Analysis of health policies is both a strategic and a social practice that may take a great deal of time. However, health policymakers may encounter a terrifying reality in today’s fast-paced world where they must make critical decisions in a short time. The literature on health policy uses mostly specific principles and models to describe health policies in abstract, analytical terms and primarily to the study of health policies: 193 macro-analysis mechanisms including the state’s position are precise instruments for policymakers.

Medicine has gone a long way in the past 100 years. More emphasis on evidence-based science, emerging medical technological advances, and new therapy and clinical approaches are just some of the areas in which modern medicine has improved society’s quality of health as well as the average life expectancy (Balasubramanian, 2020). In the last ten years, though, prescription drug pricing has become a massive area of focus. This paper, therefore, identifies the steps in the preparation of the health policy phase, particularly in the fields of drug pricing.

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  • Identify the Issue.

Numerous prescription medicinal products have rising costs, mostly to blame for price hikes, not costly new medicines, or improved conventional medicines, as drugmakers often argue. According to the professor of medicine policy and management at Johns Hopkins University, price changes for current drug products not only favor drug manufacturers but consumers who can make extra money from higher-price drug rebates. In most big drug firms, research and development account for about 17% of gross expenditure. Suppose the FDA has licensed a medicine. In that case, research and development expense is negligible, meaning that medicine firms cannot explain price hikes by citing the cost of research and development. The study found that innovation has been behind price hikes for some drug classes. Pharmaceutical suppliers innovate massive investment innovations. The new technology will save lives, but it cannot be afforded for all.

Few patients are not using medicines as recommended due to the increased cost of drugs. According to the poll, 8 percent of American adults are unable to afford their prescription drugs. This money-saving approach also has been motivated by insurance coverage. For younger adults (those under 65), 6% who have private insurance are saving money by skipping prescriptions, compared to 10% for Medicaid people and 14% for non-insurers. Some 14 percent of the most impoverished adults, who had wages well below federal poverty, did not take medicinal products as recommended to save money (Howard LeWine, 2015). Therefore, the dilemma is that people can’t afford the drugs they need.

  • Issue Described.

The pricing of medications is not an easy task. The crisis is all contributed by distributors, drug manufacturers, drug reward agents, and insurance undertakings. Pharmaceutical firms believe the price of their medicines to be exclusive to them, compete with other companies, and make medications more effective (Brown, 2020). Companies often consider the significant R&D costs involved with marketing a drug, contributing to high prices for new medicines.

PBM is the connection between insurance providers, government agencies, and large employers. On behalf of health plans, they handle prescription drug coverage. PBMs work in the prescription drug delivery chain. In other words, to create and keep a catalog of covered drugs on behalf of insurance providers that control which people use and decide out-of-pocket prices, use their buying power to secure discounts and rebates from drug producers. The willingness of PBMs to deal with higher manufacturers’ discounts has helped lower medication costs and reduced drug expenditure growth in the last three years. But PBMs may also provide an ability to promote cost-effective medicines over medications (Health, 2019). Because they often offer discounts that are measured as a proportion of the manufacturer’s selling price, PBMs are paid higher discounts on costly drugs than medications that may have a cheaper benefit. This leads to higher out-of-pocket costs for people with a highly deductible package or copaways, depending on a prescription listing price.

PBM sales generally consist of a mixture of operating charges, advertising, and other income. There is debate as drugmakers are being forced to increase their drugs’ price list by paying increasing refunds on PBM (Jacob J. Drettwan, 2019). The pharmaceutical company makes progress with the form. A formulary is a list of medications chosen as medicines for specific health problems by the health plan. For instance, if a corporation charges a medicine price at $100, at least half the price is negotiated by PBM. They pocket almost 20% of the negotiations and eventually transfer the remainder to an insurance agent or employer. The PBM pushes the medication into the form so that the customer can get it cheaper. This is why the prices of drugs remain high for pharmaceutical firms.

  • Importance of the issue

KFF Health Tracking Poll found that multiple legislative choices for curbing prescription drug expense benefit a plurality of adults, including seniors. One-fourth of adults (24%) and older people (23%) say it is challenging, including one in ten (all in all) adults and seniors (2%) say that prescription medicines are complicated to pay (Ashley Kirzinger, 2019). Although the public sees pharmaceuticals firms’ earnings as a significant driving factor in the prices of prescription drugs (80%), the majority (63%) also believe that profits derived from pharmaceutical beneficiary administrators are an “important factor” contributing to the prescription medication price as businesses managing prescription drug coverage of insurance programs. On the other hand, 56% of the population report that the life of people in the U.S. has been improved by prescription drugs produced over the last 20 years (Sullivan, 2018), but 53% state that the pharmaceutical industry is unfavorable.

Pharmaceutical firms see the public’s profits as an essential component in the price of generic medicines. At least eight in ten – through party I.D.s – a state that insurance firms’ earnings are a “huge factor” in prescription drug prices. This is followed by 7 out of 10 (69 percent) who state that research and development costs contribute to the price. The number of people who say they are unfavorable is indicative of the importance of the question. People spend vast sums of money per month to offset the expense of medication. This is also critical because patients do not pay for efficacy; they pay for what pushes the form.

  • Possible Solutions

Pharmaceutical manufacturers should continuously support all of their positive activities, including patient support services, study and create new and updated therapy courses, and demonstrate the importance of medications for patients.

The government should either lead the production of these medications or be treated as vaccinations forbidding aggressive pricing. The government should not subsidize drugs that do not significantly change health outcomes . In establishing the price and coverage, we need to take a long look at the effects of a long-term prescription gain. Patents are a crucial reason for pharmaceutical firms to invest in novel therapies; the pharmaceutical business does not function without patents. But patents need to be expired to help generics reach the industry and reduce costs (Hirsch, 2018). Unfortunately, the work-loopholes for non-truly different medicines that stretch or change patents are becoming a problem for pharmaceutical firms to block the generics market’s development. Let us close the gaps and make sure patents work as expected.

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Electronic health reports may be a potential alternative as providing information to the patient would be improved. The careful use of accurate world data (RWDs), including research and development, regulatory decision making, medical technology appraisal, pricing and payment decisions, and treatment, was needed to make pharmaceutical development and use measure better and effective (Hans-Georg Eichler, 2018). A learning structure in healthcare will be expected to use the full ability of RWD to supplement results from randomized controlled studies focused on electronic health reports and other regularly collected data. The essence of research questions posed by a drug can vary in its production and commercial phases

  • Stakeholders/Barriers

The dilemma is that of Pharmacy Benefit Managers. Pharmacy benefit management (PBM) companies have been increasingly examined as a crucial participants in the U.S. pharmaceutical industry. They are described as the intermediaries who are the most curious about. By changing the whole mechanism and not relying only on sales, policymakers would reduce the expense of medicines and encourage alternative treatments; the government may be part of a way to minimize drugs cost. But they will remain a deterrent if they realize that PMBs will stick for a portion of discounts. Patients, doctors, insurance plans, hospitals, and electronic healthcare record (EHR) providers are included among stakeholders.


Ashley Kirzinger, A. L. (2019). KFF Health Tracking Poll – February 2019: Prescription Drugs. KFF polling.

Balasubramanian, S. (2020, September 21). Prescription Drug And Healthcare Costs Are Rising. Retrieved from Forbes:

Brown, E. F. (2020). NASHP Model Pharmacy Benefit Manager Contract Terms . Georgia: National Academy For State Health Policy .

Eichler, H. G.-D. (2019, April 14). Clinical Pharmacology And Therapeutics. Data Rich, Information Poor: Can We Use Electronic Health Records to Create a Learning Healthcare System for Pharmaceuticals?, pp. 912-922.

Hans-Georg Eichler, B. B.-D. (2018, October 14th). Data Rich, Information Poor: Can We Use Electronic Health Records to Create a Learning Healthcare System for Pharmaceuticals? Retrieved from X-MOL:

Health, C. (2019, January 8). Canopy Health Urgent Care Centers . Retrieved from Canopy Health :

Hirsch, D. (2018). 5 Ways to Really Fix High Drug Prices.

Howard LeWine, M. (2015). Millions of adults skip medications due to their high cost. Harvard Health Journal.

Jacob J. Drettwan, A. L. (2019). An Ethical Analysis of Pharmacy Benefit Manager (PBM) Practices. An Ethical Analysis of Pharmacy Benefit Manager (PBM) Practices.

Sullivan, T. (2018, May 5). Why Do People Believe Drugs Are Too Expensive? Retrieved from Policy Med:

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