Medical insurance: Why you may get generic drugs

A man swallows tablets. Sometimes health service providers prescribe certain drugs to their clients on medical insurance depending on their medical cover but not because of the kind of drugs the patient requires. Photo by Dominic Bukenya.

Mid last year, Moses’ child suffered an infection and he took her to a prominent hospital in Namugongo, Wakiso District for treatment.

The child was under a health insurance scheme. Despite the fact that they followed the prescription to the dot, the child’s health kept deteriorating. A month later, he took her back.

The doctor changed her medication but Moses also noticed that where the doctor prescribed 5ml, the nurse at the dispensary wrote 2.5ml.

When he probed, he was advised to buy the rest of the drugs at another pharmacy to complete the dose. “She said they were working under instructions to the effect that there was a limit they could not exceed,” he recalls.

A week later, the child’s condition was not improving so he took her to another health centre in the same area. “The doctors wondered where I was getting the first medication from and threw away all the medicine we had got from there. I learnt that they had been giving her only generic drugs. We started her on fresh medication and she was better in two days,” he says.

From then, Moses said he lost faith in the health insurance services and only goes for blood tests and prescriptions and afterwards buys the medicine from a pharmacy.

Rhona Akongo’s case was different. Her son got an asthma attack and she rushed him to a renowned hospital, only to be shocked when she was asked to pay for the inhalers.

She had hoped to get everything “free” since the child was insured, but was informed that insurance has a limit on what it takes care of and the package on which one is dictates the kind of insurance one gets.

From then, Akongo always inquiries from the insurer what to expect when her package changes so that she is not disappointed.

Medical insurance is a cover that caters for a person’s medical expenses in the event of an illness or hospitalisation. Often times, when one gets insured under their organisation, they think they will get quality and fully paid for medical bills. But this is not the case.

In a written contract Saturday Monitor saw between a certain insurance company and a clinic in Kampala, the former instructed the latter to give only generic drugs or else the insurance company would not pay for the branded drugs.

“You should only prescribe generic drugs (Section 3h); we will only pay claims for generic drugs. If you prescribe branded drugs, we will only cover the cost for the equivalent generic drugs. If you believe strongly that a branded drug must be used, because you have evidence that the alternative generic is not effective, then you must first have such agreement in writing from us before prescribing and before claims for such treatments paid,” the contract read in parts.

The letter further stated that this agreement is the same as what the insurance company has with all the other service providers, implying that the treatment got elsewhere may not be different.

While the medical personnel of such clinics have an option to consult the insurance providers before prescribing a branded drug, the doctor who showed Saturday Monitor the agreement said this arrangement stalls work.

“It is not practical to keep calling the insurance company before prescribing a certain drug. A doctor should be left to prescribe the right drug as and when they deem it necessary,” he said.

Another medical personnel from one of the major private hospitals in Kampala, who preferred anonymity due to the sensitivity of the matter, said the insurers have a preference for generic drugs but do not dictate that the hospital only uses generic drugs.

“But most generic drugs that we use are good because they are screened through the pharmaceutical society in Nairobi-Kenya. However, if we feel that a branded drug will be more effective, we ask for pre-authorisation from the insurer,” he explains.

Herbert Mukoza, the general manager IAA insurance, argues that due to customer demands, IAA had engagements with doctors and agreed that some generic drugs cannot treat certain illnesses, hence allowing room for branded drugs since 2012.

He added that prescription is based on fit-for-purpose in all International Medical Group companies (IMG), which include International Hospital Kampala (IHK), and International Air Ambulance (IAA), as well as the affiliated service providers.

“The discussion you have with the doctor determines the drug to get and this can be a combination of generic and branded drugs. We prefer generic drugs because of cost implications, but we do not compromise on quality,” he explains.

On the issue of seeking permission from the insurance company before dispensing branded drugs, Mukoza says IMG’s facilities give any drugs according to the customer’s needs but affiliated clinics have to seek permission because of the fraud involved in pricing.

“There is a lot of connivance in some of the private clinics that they give a generic drug and price a branded drug. Getting permission does not take long because there is a team available to offer this authorisation all the time.”

He, however, emphasises that branded drugs are offered only on the doctors’ advice, but not because the patient wants it.

Insurance policy on prescription
But Paul Nagemi, the assistant general manager at UAP Insurance, says insurers do not dictate the drugs to give but advocate for best practice that not only branded drugs should be used. “Hospitals are given a general guide where doctors need to balance the drugs but clients only look at the premium,” he says.

He instead advises that patients first understand the package on which they are, as this will inform their benefits.

“The price dictates the benefits of medication one gets. Medical insurance is a business, so we have to be tight on pricing and risk management. If you have less money, then you will get an inferior cover,” Nagemi explains.

He further points out the tendency for people to abuse “free” things and hence rushing to hospital at any slight complaint. “Ideally, we should be having more patients of life-threatening illnesses but have more complaints of infections such as flu that can be prevented,” he says.

Human resource personnel, however, reveal that employees are often sensitised on their insurance covers. “We invite all the contending service providers, who make presentations as well as sensitise the staff about their entitlements.

Afterwards, we send soft copies to different departments and they take part in choosing the service provider. This enlightens the employees on what they can and cannot get,” says Jennifer Okaka, the Human Resources manager at Food for the Hungry.

Insurance, for instance, does not cater for shampoos, mouthwash, gels and multi-vitamins.

But the doctor who showed Saturday Monitor the agreement said when giving instructions, the rules are not separated between those on higher premiums and those on less.

The treatment is the same so in the end, one may not gain much from the insurance scheme if the providers are not restricted by the insurance regulatory authority.

Trevor Ariho, the general manager of AAR insurance, argues that they enter into different contracts and different service providers negotiate differently.
“There are those who charge a standard fee per person despite the medication you get but there are those who prefer to charge a particular amount per member.

He instead attributes the practice of prescribing only generic drugs to the service providers. “Some clinics give only generic drugs but instead charge us for branded drugs, while others never stock branded drugs because they are expensive,” he explains.

He gives an example of the fact that they had to de-list 22 service providers because the charges versus the given drugs did not tally.

In instances that a patient is given generic drugs yet they feel that the branded version would be more effective, he advises one to ask for a prescription, and get the medicine from a partner pharmacy with their insurance card. “We have opened up a list of pharmacies that we work with so look up the list for help,” Ariho says.

Depending on the company, a person can get insured for as low as Shs400,000 per annum, but this means that you will be limited on the kind of hospitals you visit and the benefits you get.

Efforts to get individual insurance premiums were futile as insurance companies claimed they keep changing and some insurance companies tailor the money according to the customer’s needs and budget.

Insurance Regulation Authority's take

Mariam Nalunkuuma, the communication officer of Insurance Regulatory Authority (IRA), says there are five medical insurance companies and 13 Health Membership Organisations (HMO’s) in Uganda.

“These include Liberty, Sanlam, Jubilee, Insurance Company of East Africa (ICEA) and UAP.” She says.

To address the issue of generic and branded drugs, she says IRA had an initial meeting with medical practitioners on how to address the issue. In the meeting, the issue of pricing, confidentiality by doctors and harmonising both the doctors and insurers complaints were addressed.

“We are planning for more meetings to see that the above problems are resolved,” Nalunkuuma says.
Way forward for the customer

Nalunkuuma says the biggest problem is that in most cases, the policy beneficiaries are not aware of the entitlements and exclusions. She, therefore, advises that;

• The human resource department appreciates what has been covered and then invites the service providers to explain to the staff their inclusions and exclusions.
• Understand the network of insurer operates so that you do not go to a wrong service provider as then you will not be attended to despite having your medical card.
• HR has to explain the limits, categories to the staff such that they understand when they will be asked for a top up or to pay for a certain service.

Generic Vs branded drugs

Kevin Juma, a pharmacist at Mulago hospital, defines generic drugs as drugs intended to be interchangeable with an innovator product that is manufactured without a license from the innovator company and marketed after the expiry date of the patent or other exclusive rights.
Normally, innovators incur exorbitant costs into research to make branded drugs and acquire rights of monopoly of the drug until the costs are recovered.

The generic is a copy of it and the people who produce generic versions just make a copy of the same drug, without incurring any innovation costs but have to acquire authorisation from brand product manufacturers to come up with the same drug.

Another private hospital employee revealed that certain branded drugs are extremely expensive and yet most insurance covers have little amounts.

“For example, a certain patient may have a full cover of Shs700,000 to cater for the entire year so you cannot give a drug of Shs600,000. In such cases, we advise them to buy the drug,” he says.

He revealed that some insurance companies often eliminate clinics that prescribe branded drugs and those that try to oppose the set terms. “Some doctors accept these terms because they need the business and keep admitting patients unnecessarily so as to make a profit. We can only make money on admissions,” he says.

However, some specialists allege that the generics do not meet the standards of the branded one. Because they are restricted to only generic drugs, the doctor says you might end up treating a minor illness for a long time because some generic drugs are not effective.

“Generic drugs can be effective but the most effective are also expensive, others are useless and obviously generic drugs cannot be more effective than branded drugs,” he says.
Due to use of ineffective drugs, the doctor says patients get anti-biotic resistance and many diseases fail to be cured. “In the end, it is the patient that suffers but we as doctors should know that the patient’s health is more important than money,” he says.