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The price of an EpiPen has ballooned by 400 percent since 2007, but it's just the latest medicine to grab headlines. The prices of other drugs have also spiked recently, like insulin and Albuterol, a drug used to treat asthma. Kara Lofton from West Virginia Public Broadcasting reports on how this is affecting all West Virginians on private insurance and on Medicaid.
KARA LOFTON, BYLINE: One recent Thursday afternoon, Kimberly Earl's youngest son is at the YMCA for swim lessons. Six-year-old Wyatt has asthma and a peanut allergy. Last year, he and his sibling both needed new EpiPens, which come in a two-pack.
The Earls have private health insurance but had yet to meet their $10,000 deductible. They didn't have enough money for two boxes at the $600 price, even with a hundred-dollar discount from the drug maker Mylan pharmaceuticals, so they improvised.
KIMBERLY EARL: We took the pens and we split the two pens between the two kids. And I actually took the pens out and wrote on the top, use this one first on the current pens, use this one second on the expired pens. So each kid was walking around with one current pen and one expired pen. And we were just hoping that if there was an issue, they wouldn't actually have to use that second pen.
LOFTON: But a third of West Virginians are insulated from these direct costs. That's because the state expanded Medicaid under the Affordable Care Act, giving lower-income people the government-sponsored insurance. Most Medicaid patients don't have premiums or co-pays. But in the end, rising drug prices affect them, too. When lawmakers consider the budget, they only have so much revenue, says Dr. James Becker, the medical director of Medicaid in West Virginia.
JAMES BECKER: So when the cost of a drug goes up dramatically, that impacts our system, and we have to step in and try to make adjustments to regulate the drug appropriately.
LOFTON: The Health Department can regulate the cost of drugs by negotiating for lower prices through the federal rebate program, which is complex but basically comes down to the more Medicaid patients, the more bargaining power with drug companies to lower prices.
Another way Medicaid manages cost is by using older, cheaper but still effective drugs. But even with these measures, more costly drugs mean that the department has to shift around funds to accommodate higher cost, says West Virginia Senator Ron Stollings.
RON STOLLINGS: Certainly for Medicaid funding in West Virginia, I mean, that's a huge cost. And so when we have to put money into funding Medicaid, then we have to cut funding for higher education and secondary education. We have to put off paving projects, etc.
LOFTON: And West Virginia has been wrestling with budget shortfalls recently. So, Stolling says, rising Medicaid cost, partially due to higher drug cost, fall on taxpayers no matter what kind of insurance they have.
STOLLINGS: If you're a taxpayer, it impacts you, OK? If you're insured, if you're an insured person, it will impact your premiums. And if you're on Medicaid, you may get this expensive medicine but they might be ratcheting down coverage for other things.
LOFTON: In West Virginia, without federal matching dollars, Medicaid makes up the second-largest portion of the state budget, just behind public education. And it may get even bigger as the state picks up more of the Medicaid expansion costs next year. So high drug prices will continue to hit West Virginians hard. For NPR News, I'm Kara Lofton.
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