Self-care – the role of OTCs for personal health financial management

imageMake-over your medicine cabinet. That’s a key headline for International Self-Care Day (ISD) on July 24, 2014, an initiative promoting the opportunity for people to take a greater role in their own health care and wellness.

Sponsored by the Consumer Healthcare Products Association (CHPA), consumer products companies, health advocacy organizations, and legislators including John Barrow (D-GA), a co-sponsor of H.R. 2835 (aka the Restoring Access to Medications Act), the Day talked about the $102 billion savings opportunity generated through people in the U.S. taking on more self-care through using over-the-counter medicines.

After the 2008 Recession hit the U.S. economy, industry analysts predicted the start of a new era for OTC-switch – turbocharging the movement of prescription drugs to over-the-counter status to remedy medical-economic stress. This hasn’t happened as quickly as those forecasts expected. image

Health Populi’s Hot Points:  The $102 bn price tag on self-care savings to the U.S. macroeconomy translates into real dollars for consumers who can avoid overtreatment in the health “care” system by doing more at-home.

With the growth of high-deductible health plans coupled with HSAs in the U.S., employers and health plans are shifting more financial risk to enrollees. This risk-shift from sponsors to people puts them into the role of de facto health care “consumers.”

Most people say they want to embrace DIY-style health care through e-health channels like health information-seeking online, re-filling prescriptions via ePrescribing using mobile health apps, and making appointments online. These are largely administrative burdens that the health system is happy for people to take on, saving labor costs for health plans, pharmacies and delivery systems.

ISDBut what about greater clinical care decisions? So far in the OTC world, consumers have happily migrated (as expressed through $ migration) to over-the-counter products to manage allergy and gut issues. See the success of Claritin and Zyrtec on the allergy front, and Prilosec and Pepcid AC for taking care of GI issues as first-line treatment. When I go to Europe, I might buy a statin over-the-counter in a pharmacy in the UK or metformin in a Spanish farmacia or an apotheke in Germany. In the U.S., this isn’t possible…today.

However, more pharmaceutical companies note that the consumer-side of their balance sheets could add value to lagging branded pharmaceutical portfolios and maturing brands. Look for spin-offs of such businesses, as Andrew Witty of GSK says he’s considering this week, as well as the growth of switch from Rx-to-OTC to generate cash opportunities — and greater consumer engagement through self-care in retail channels. Health care consumerism and peoples’ interest in shared decision-making in health care is growing: 9 in 10 U.S. adults say they want a role in decision making with their doctors in Altarum’s most recent consumer survey.

Under these circumstances and realities, it is irrational for PPACA to have eliminated the OTC provision for health savings accounts. This is what CHPA has called the “medicine cabinet tax.” For Americans to become fully engaged as health care consumers, it makes fiscal and rational sense to allow taxpayers to use OTCs as part of HSAs — to bolster healthcare personal financial management.

One Response to Self-care – the role of OTCs for personal health financial management

  1. Mark J July 29, 2014 at 1:53 pm #

    Add Nexium to that “gut” list too. HUGE marketing push going on now, I feel like I am in Barney land with all the purple pill marketing going on at Walgreens and CVS right now…

    Frustrating that OTC has been dropped from HSA and FSA (2011).
    http://www.irs.gov/uac/Affordable-Care-Act:-Questions-and-Answers-on-Over-the-Counter-Medicines-and-Drugs

    However, OTC costs are still higher than many prescription copays for some plans. But, more OTC is definitely welcomed for those without affordable Rx benefit coverage.

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