Keeping medicines affordable

Without government measures, the costs of pharmaceutical drugs would rise every year. The government makes agreements with doctors, pharmacists and health insurers to control these costs.

Measures to keep medicines affordable

Spending on medicines increases each year. And more costly, innovative medicines are being developed for the treatment of patients. To ensure that everyone in the Netherlands has access to medicines, the government wants to control the costs. This is why it has taken measures to: 

  • amend the Medicine Prices Act;
  • modernise the Medicines Reimbursement System;
  • make agreements with care providers, health insurers and patient organisations about expensive medicines;
  • limit co-payments for medicines to €250 per patient;
  • negotiate the price of medicines with pharmaceutical companies.

Amending the Medicine Prices Act

The Dutch Medicine Prices Act sets maximum allowable prices for medicines (in Dutch) in the Netherlands, based on the average of what similar medicines cost in 4 reference countries. As of 15 December 2019 these reference countries are Belgium, France, Germany and the United Kingdom. 

Starting in April 2021 the most recent price cuts for medicines were introduced. Prices could be lowered because Norway replaced Germany as a reference country and the prices of medicines in Norway are lower. The prices of medicines with a relatively low turnover have not been lowered.
The amendment should result in savings of approximately €160 million on medicines dispensed by pharmacies outside hospitals. Savings will also be made on medicines dispensed in hospitals.

Modernising the Medicines Reimbursement System

Health insurers only reimburse the cost of registered prescription drugs that are included in the Medicines Reimbursement System (GVS). There are around 500 groups (‘clusters’) of drugs in the GVS. The medicines in each cluster can be substituted for one another. A maximum reimbursement has been set for each cluster in the GVS. If a medicine costs more than this amount, the patient has to pay the difference.

The Ministry of Health, Welfare and Sport is going to review the reimbursement ceiling for each drug cluster. In some cases, the amount that is reimbursed may be too low, resulting in high co-payments for patients. For other clusters, there may be a large number of competitively priced drugs available on the market, so that the amount reimbursed can be reduced.

Modernisation of the GVS should make the system better for patients and fit for the future, and result in permanent cost savings of €140 million as of 2023.

Agreements with care providers, health insurers and patient organisations about expensive medicines

The integrated package of measures contains agreements on the procurement and appropriate use of expensive medicines. 

Maximum co-payment of €250 per patient

The co-payment for medicines that cost more than the reimbursement ceiling comes on top of patients’ compulsory excess of €385 per year. The government has decided to limit these co-payments to €250 per patient per year as of 2019. Health insurers must reimburse the remaining amount.

Negotiations with pharmaceutical companies on the price of medicines 

The government also wants to ensure more competitive prices are negotiated with pharmaceutical companies. The Minister for Medical Care will take the lead in more of these negotiations. Health insurers will not reimburse a medicine until these negotiations are concluded. Negotiating more competitive prices could result in annual savings of €155 million. In 2017, the total savings were €132 million. The government also wants to give pharmacists more clarity about when they can make medicines themselves.

Including new medicines in the standard health insurance package

The Healthcare Institute of the Netherlands advises the Minister of Health, Welfare and Sport on reimbursements for new medicines dispensed by pharmacies. Medicines are assessed following a standard procedure. After this, the Minister decides whether the medicines will be included in the Medicines Reimbursement System (GVS) and reimbursed under the standard health insurance package. 

For most medicines dispensed in hospitals, health insurers decide whether the costs are reimbursed. An exception applies to very expensive medicines.

Expensive medicines are not automatically covered

The standard health insurance package does not automatically cover new, expensive medicines. The minister can decide to temporarily exclude new drugs from the standard package. These medicines are then put ‘on hold’. The Healthcare Institute of the Netherlands can then issue an advisory opinion on their use and the minister can negotiate a better price with the manufacturer. A medicine is put on hold if

  • using the medicine for one or more new indications would cost more than €40 million per year across the Netherlands;
  • using the medicine for one new indication would cost more than €50,000 per patient per year, and more than €10 million per year across the Netherlands.

It is only the medicine itself that is put on hold; all other parts of the patient’s treatment, including hospital admission, are still covered by health insurance. 

Reducing the cost of expensive medicines

The Minister of Health, Welfare and Sport (VWS) wants to know why some medicines are so expensive. People have the right to know what their health insurance premiums are being spent on.

Austria, Belgium, Ireland, Luxembourg and the Netherlands have joined forces in the Beneluxa Initiative to give patients access to innovative medicines faster and at an affordable price. For more information about this collaboration between 5 European countries, go to the Beneluxa Initiative website.

Procurement of expensive medicines

Expensive medicines need to become more affordable and more accessible. The government has set up the Platform for the Procurement of Expensive Drugs (Platform Inkoopkracht Dure Geneesmiddelen) in order to improve procurement of these medicines by hospitals. The Platform brings together experts in this field from hospitals, pharmacies, health insurers and universities.

Health insurers provide cover for the cheapest version of a medicine

Most health insurers usually only provide cover for the cheapest version of a medicine containing the same active ingredient as the branded drug. This is referred to as preferential policy. By using cheaper versions of the same medicine:

  • health insurers spend less money on medication
  • so that they can keep premiums low
  • and patients pay the lowest price for the medicine if it falls under their excess.