advertisement

Companies

Insurers seek generic drugs rules to cut medical cover costs

Jubilee Group of Companies chairman Nizar Juma (left) flanked by Jubilee Insurance CEO and Association of Kenya Insurers chairman Patrick Tumbo. PHOTO | DIANA NGILA | NMG
Jubilee Group of Companies chairman Nizar Juma (left) flanked by Jubilee Insurance CEO and Association of Kenya Insurers chairman Patrick Tumbo. PHOTO | DIANA NGILA | NMG 

Insurers are pushing for rules that will require hospitals to prioritise dispensing generic drugs over branded medicines to patients as a strategy to tame the rising cost of medical cover.

The Association of Kenya Insurers (AKI), an industry lobby, is calling for a legal framework, which will ensure doctors do not prescribe the brand name, but only write down the chemical make-up of the drug.

AKI chairman Patrick Tumbo reckons that drugs make up about half or an average of 45 per cent of patients’ hospital bills, and the ratio is even higher in health facilities that dispense branded medicines.

“When the cost of healthcare goes up, we’re also forced to raise premiums. Generic drugs can be up to 80 per cent cheaper than branded drugs,” Mr Tumbo said in an interview with the Smart Company.

Underwriting loss

AKI wants Kenya to follow in the footsteps of India where Prime Minister Narendra Modi in April announced a new health policy, which compels doctors to prescribe generic medicines and only resort to branded ones in unique cases where there are no cheaper alternatives.

New drugs are normally developed under patent protection, but once that expires, other pharmaceutical firms are allowed to develop them in all chemical characteristics thus their cheapness. 

Half of Kenya’s 20 insurance firms, which offer medical cover reported underwriting losses in this category in the period to December 2016, according to official data.

Full story in the Smart Company.

advertisement