Jubilee pushes for generic drugs to cut treatment cost

Jubilee board chairman Nizar Juma. PHOTO | SALATON NJAU | NMG 

By JAMES KARIUKI
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Summary

• Jubilee Insurance says the use of generic drugs will lower the cost of treatment.
• It will also encourage insurers to lower medical cover premiums as well as seeing more underwriters introduce medical covers.
• Last January, Madison Insurance stirred a storm when it instructed doctors treating patients under its cover to dispense generic drugs only.
• The firm, in a memo dated January 3, directed all its service providers to only prescribe generic drugs beginning January 7.

Kenya’s largest underwriter by market share, Jubilee Insurance, has renewed calls for policy change that will see hospitals dispense cheaper generic drugs as opposed to the costly original products.

The listed firm says the move will lower the cost of treatment, encourage insurers to lower medical cover premiums as well as seeing more underwriters introduce medical covers.

“Improving access to medical cover is one of the government’s Big Four pillars that can best be addressed by creating an enabling environment for underwriters to play their role of providing medical cover to the middle and lower segments of society,” Jubilee board chairman Nizar Juma said.

Speaking in Nairobi at the firm’s annual general meeting, Mr Juma observed that promotion of generic drug use would also spur local manufacturers to increase production.

The firm says it is supporting a pilot where doctors-on-site charged Sh500 for consultation and priority to prescription of generic drugs in a bid to lower cost of treatment.

“Some insurance companies charge extremely low premiums for medical cover but have ended up losing out since medical claims are very high that they cannot sustain. Undercutting is not the best way to grow your business as it will lead to retrenchment and closure of branches to remain afloat,” he added.

Last January, Madison Insurance stirred a storm when it instructed doctors treating patients under its cover to dispense generic drugs only.

The firm, in a memo dated January 3, directed all its service providers to only prescribe generic drugs beginning January 7.

The Kenya Medical Practitioners and Dentists Union, however, urged doctors to ignore the directive and dispense drugs as per scientifically proven guidelines on treatment.

The doctors argued that while the insurer’s directive was aimed at cutting costs and making healthcare affordable, the move would compromise quality of health services.

Medical insurance firms suffered a net industry loss of Sh1.1 billion last year, which they blamed on doctors engaging in fraud and colluding with pharmaceutical firms to fleece underwriters.

According to them, falsified claims and high cost of drugs prescribed pushed more than half of medical cover providers into losses.