[Reporter’s View] Disclose PVA results in advance as well

together with the price ceiling reevaluation results

The government announced the 7,000 drug items whose insurance price ceiling will be lowered according to the reevaluations that were conducted in advance.

 

This preemptive measure was made out of concern over the large settlement of price differences and returns that may occur with the price adjustment.

 

The product list and upper limit price were released on the 23rd of last month and were publicly notified on the 1st.

 

The price adjustment will be applied in the field from the 5th.

 

The public health authorities accepted the opinion of the Korea Pharmaceutical Association and others who requested sufficient time to prepare for returns and settlement of differences before the price adjustments.

 

However, there remains some to be desired.

 

In addition to those that were adjusted post-reevaluations, the insurance price ceiling of 134 other items had also been adjusted through the PVA (price-volume agreement) system.

 

The adjusted price for the PVA price cuts will also become effective as of the 5th.

 

Among the PVA price cut items, the prices of some have been further reduced due to the reassessment of the price ceiling, so the implementation of the PVA price adjustments was changed to match the price ceiling reevaluation schedule to prevent confusion in the field and reduce administrative costs.

 

18 items have undergone both PVA and price ceiling reevaluations.

 

If the PVA price cuts were first implemented on the 1st of this month as scheduled, then the price ceiling reevaluation adjustments implemented on the 5th, these drugs would have had to change their price twice in one month.

 

In this sense, setting the same implementation date for the two was reasonable and correct.

 

However, it would have been better if the government had disclosed the PVA-adjusted drug items in advance as well.

 

The price ceiling reevaluation results were released on the 23rd of last month, but the PVA list was released only on the 31st, after completing the Health Insurance Policy Deliberative Committee (HIPDC) review.

 

Wholesalers and pharmacies have expressed the opinion that more preparations were needed for items on the PVA list, due to the high volume of returns necessary for some of the frequently used items.

 

However, unlike the price ceiling reevaluations, the adjusted insurance prices were not announced in advance for the PVA items, increasing inconvenience in the field.

 

Why the PVA list was not disclosed in advance, unlike the price ceiling reevaluation results, remains a question, as the effective date for the price ceiling adjustment for the two drugs was set at the same date, on the 5th.

 

It is interpreted this may have been in line with the principle of non-disclosure before HIPDC review, but it is regrettable that the government was unable to show some flexibility, given that the price ceiling reevaluation results that were disclosed were also yet to receive HIPDC review at the time of disclosure.

 

As a result, while 14 days were given to prepare for the return of items that underwent price ceiling reevaluations, only 6 days were given to prepare for the return of the PVA items.

 

Another problem is that the prices of some items that are on the price ceiling reevaluation list will further be reduced due to PVA.

 

If companies had prepared to settle their accounts based on the prices indicated in the price ceiling reevaluation list that was disclosed on the 23rd, they would have had to make re-readjustments to their accounts.

 

In this sense, the imperfect data that was disclosed to prevent on-site confusion has burdened the site.

 

This too could have been prevented if the PVA results had been transparently disclosed on the 23rd.

 

The government's pre-release of the list of drug price cuts and postponement of the PVA implementation date are commendable in that they considered the confusion that will be caused by returns and balance settlements after the price adjustments.

 

However, the measure should have been more well thought out.

 

It would be best if the Ministry of Health and Welfare, which is in charge of the price ceiling reevaluations and PVA, put some more considerations into its measures.