New Study: Over-the-Counter (OTC) Medicine Saves Healthcare System Billions

WASHINGTON, Jan. 31, 2012 /PRNewswire-USNewswire/ -- A new study, "The Value of OTC Medicine to the United States," released by the Consumer Healthcare Products Association (CHPA) today, finds that for every dollar spent on over-the-counter (OTC) medicines, the U.S. healthcare system saves $6 to $7 – providing  $102 billion in value each year. 

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Booz & Co. surveyed 3,200 consumers for the study, which is the first to measure the aggregate cost savings of OTC medicines as used for the seven most common self-treatable conditions in the United States.  An estimated 240 million people rely on OTC medicines for symptomatic relief; the study evaluated how consumers would treat these seven conditions if they did not have access to OTC medicines. The total value equates to the total direct savings from avoided clinical visits and diagnostic testing ($77 billion) and use of less costly OTC medicines, rather than more costly prescriptions ($25 billion).  

"This study is the first of its kind to assign a dollar value that captures how our entire healthcare system relies on OTC medicines for affordable healthcare," CHPA President and CEO Scott M. Melville said.  "When you consider that every dollar spent on an OTC medicine saves our system 6 to 7 dollars in avoided cost, it is paramount that our policymakers do all they can to encourage consumer access to OTC medicines for self-treatable conditions."

The study also found that by keeping the American workforce healthy and at work, OTC medicines offer $23 billion in potential additional productivity benefits from doctor's office visits avoided and time not having to be away from work for medical appointments.  Americans would make an additional 450 million doctor visits annually, which equates to 56,000 medical practitioners working full-time, if they did not have access to OTC medicines and instead saw a physician to get a prescription.

"Over-the-counter medicines are people's first line of defense; it's their home healthcare, it's what they turn to in order to take care of themselves and their families," National Alliance for Hispanic Health President and CEO Jane Delgado said. "The availability of safe and effective OTC medicines empowers patients to take a more active role in their personal healthcare management.  Access to safe and affordable OTC medicines is key to accomplishing that goal."

Melville added that the study findings underscore the importance of reversing a provision in the 2010 Affordable Care Act (ACA) that prohibits consumers from using their flexible spending arrangements (FSAs) to purchase OTC medicines without first getting a prescription. At the time this provision was enacted, an estimated 19 million working American families purchased OTC medicines, relying on these accessible and affordable medicines to keep their families healthy.

"This study underscores some of the reasons why the AMA believes it is important to eliminate the provision of the Affordable Care Act that requires millions of patients using flexible spending accounts, and other tax-preferred accounts, to obtain a prescription for over-the-counter (OTC) drugs to be eligible for reimbursement," American Medical Association (AMA) President Peter W. Carmel, M.D., said. "Ending this provision will reduce unnecessary office visits, which will save time and money for patients, physicians, and the healthcare system."

CHPA supports efforts in Congress to repeal the OTC prohibition, including the Restoring Access to Medication Act (S.1368/H.R. 2529) and the Patients' Freedom to Choose Act (H.R. 605/S.312).  These bills, and others like them, ensure that individuals, such as allergy sufferers, can use their FSA dollars to purchase the OTC medicines they need without the inconvenience and cost of a physician's visit.

"The 40 million Americans who are living successfully with nasal allergies are proof that OTC medications can help improve quality of life," Asthma and Allergy Foundation of America (AAFA) Vice President of External Affairs Mike Tringale said.  "Over the past 20 years, allergy therapies have shifted overwhelmingly to the OTC aisle, and now patients rely on the strength and effectiveness of OTC medications to help manage this chronic condition."

Additional key findings from the study include:

• The total value of OTC medicines is captured throughout the entire U.S.  healthcare system: $52.7 billion in value for employer sponsored health plans, $27.5 billion in value for government programs such as Medicare and Medicaid, and $21.7 billion in value for self-insured and uninsured populations.
• The availability of OTC medicines – off the shelf, without a prescription – provides symptomatic relief for an estimated 60 million people who would otherwise not seek treatment.
• Without affordable and accessible OTC medicines, underserved populations would depend more heavily on higher-cost medical care. 1 in 4 Medicaid patients and 1 in 10 uninsured individuals would seek treatment in an Emergency Department as their first recourse for treating a minor ailment.

For more information, go to YourHealthAtHand.org.

Click here for the full study.

About the Study

This study examines the value of OTC medicines in seven categories relative to potential alternatives, such as consultations with healthcare professionals for self-recognizable symptoms and/or using more expensive prescription medicines. The seven categories include the most common acute and chronic, self-treatable conditions representing the majority of OTC medicine purchases: allergy, analgesics, anti-fungals, cough/cold/flu, lower and upper gastrointestinal, and medicated skin.  In addition to consulting published data sets and economic modeling, Booz & Co. surveyed 3,200 consumers on how they would treat symptoms if OTC medicines did not exist.

About CHPA's Your Health at Hand

"The Value of OTC Medicine to the United States" is part of CHPA's Your Health at Hand initiative.

For millions of Americans, OTC medicines are a trusted and affordable way to get well, stay well, and feel well. Families reach for OTC medicines to relieve symptoms associated with common, everyday ailments associated with pain, cold, allergies, heartburn, and various skin conditions, among others.  In today's healthcare environment, it is important that consumers – as well as healthcare professionals, policymakers, and researchers – appreciate and promote the value and solutions OTC medicines provide. In June 2011, CHPA launched Your Health at Hand to highlight the benefits of OTC medicines, including:

• Access to conveniently available healthcare options 24/7 for busy families and caregivers;
• Affordability for both consumers and the healthcare system;
• Empowerment for individuals and families to meet their everyday healthcare needs; and
• Trust in safe and effective healthcare options.

For more information on Your Health at Hand, please visit: YourHealthAtHand.org.  

The Consumer Healthcare Products Association (CHPA) is the 131-year-old-trade association representing U.S. manufacturers and distributors of over-the-counter medicines and dietary supplements.

SOURCE Consumer Healthcare Products Association