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Study: OTC medications save billions for healthcare system

The U.S. healthcare system saves $6 to $7 for every dollar Americans spend on over-the-counter (OTC) medications, according to a new study released by the Consumer Healthcare Products Association (CHPA).

That could provide $102 billion in savings every year, the study reported.

Booz & Co. surveyed 3,200 consumers for the study, which was funded by the CHPA. Researchers measured the aggregate cost savings of OTC medications as used for the 7 most common self-treatable conditions in the United States. The value figures were derived from total direct savings from avoided clinical visits and diagnostic testing ($77 billion) and use of less costly OTC medications, 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 in a press release. "When you consider that every dollar spent on an OTC medicine saves our system $6 to $7 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:

  • Keeping the American workforce at work through OTC medications offers $23 billion in potential additional productivity benefits from doctor's office visits avoided and time not having to be away from work for medical reasons.

  • The total value of OTC medications 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 medications – 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 medications, underserved populations would depend more heavily on higher-cost medical care. One 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.

Melville noted that the study findings underscore the importance of reversing a provision in the 2010 Affordable Care Act that prohibits consumers from using their flexible spending arrangements to purchase OTC medications without first getting a prescription.

The 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),” it said in the press release.

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