Educate Employees to Help Reduce Healthcare Costs

Educate Employees to Help Reduce Healthcare Costs
The U.S. healthcare market is at a crossroads of sorts. With many employers cutting benefits to ensure their programs are not considered so-called “cadillac” plans and penalized accordingly via government healthcare reform laws, it’s more important than ever for employees to know how to stretch every dollar of their consumer-driven health plans in Pennsylvania. Start by educating your employees about some easy choices they can take that provide significant savings for both employees and their employer. One of the simplest choices is the selection of generic drugs.
The federal Food and Drug Administration (FDA) requires that generic drugs be the chemical equivalent to their brand-name counterparts in terms of purity, safety, strength, quality, performance, means of administration, and intended use. The difference is that generics are typically sold for far less than their brand-name twins, which amounts to huge cost savings. In fact, the Congressional Budget Office estimates that consumers save $8 billion to $10 billion per year by selecting generic drugs over brand names at pharmacies, and the savings grow even more when hospitals elect to use generics for their patients.
Why generics cost less
It costs manufacturers a great deal to develop a new drug and take it all the way to market. Initially most drugs are protected by a patent for 20 years, during which time no other company can make or sell that drug. Once the patent expires, competitors can start manufacturing and selling a generic version of that drug (after FDA testing and approval), but it costs a lot less to do this after the blueprint has already been established than creating the drug from scratch, so the cost for the generic drug is typically far less than the brand-name version.
Employers can realize these savings by reminding employees about the savings to be had, and encouraging them to do their part in the use of generics in consumer-driven health plans in Pennsylvania. This choice begins at the doctor’s office when he or she is prescribing a drug. Employees should ask their doctor if a generic version of the drug is available and appropriate whenever possible, because if not prompted, the doctor may not necessarily suggest a generic drug. Talk to a professional insurance agent to learn about more ways to save on your health plan.