Study Finds OTC Medicine Saves Health Care System Billions

The Consumer Healthcare Products Association (CHPA) released a new study January 31, 2012, "The Value of OTC Medicine to the United States," which found that for every dollar spent on over-the-counter (OTC) medicines, the U.S. health care system saves $6 to $7, resulting in $102 billion in value each year.

The study is the first to measure the aggregate cost savings of OTC medicines that are used for the seven most common acute and chronic, self-treatable conditions (which represent the majority of OTC medicines purchases in the United States): allergies, pain, fungus, cough/cold/flu, lower gastrointestinal conditions, upper gastrointestinal conditions, and skin conditions. The study evaluated how consumers would treat these seven conditions if they did not have access to OTC medicines. The total value is calculated from the total direct savings from avoided clinical visits and diagnostic testing ($77 billion) and the use of less costly OTC medicines rather than more costly prescriptions ($25 billion).

According to the study, by keeping workers healthy and on the job, OTC medicines offer $23 billion in potential additional productivity benefits from avoiding doctors’ office visits and missed 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.

The study also found that the total value of OTC medicines is captured throughout the entire U.S. health care 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. 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.

CHPA supports efforts in Congress to repeal 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 OTC drugs to be eligible for reimbursement.