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Costs In Context

The Ethics Of Pharmaceutical Benefit Management

Efforts to limit pharmacy costs raise both ethical and economic considerations. Six values should inform pharmacy benefit management: (1) accepting resource constraints; (2) helping the sick; (3) protecting the worst off; (4) respecting autonomy; (5) sustaining trust; and (6) promoting inclusive decision making. Direct controls, such as formularies, step therapy, and prior authorization, can focus limited resources on the sick and worst off. However, direct controls limit autonomy and are administratively burdensome. Indirect controls, such as physician capitation, tiered copayments, and drug benefit caps, align physicians’ and patients’ interests with resource constraints, respect autonomy, and are administratively efficient. Unfortunately, they deter use based on cost, not medical need; they do not focus cuts on unnecessary or marginal drug use or focus resources on the sick. Budget caps are the least defensible, while tiered copays and physician capitation can be justified if implemented with safeguards. Formularies and step therapy are ethically justifiable if they can be efficiently instituted.

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