PNHP

Market forces are no salve for the high cost of prescription drugs

Market forces are no salve for the high cost of prescription drugs

By Jan Swaney, M.D. and Ed Weisbart, M.D.
Columbia (Mo.) Daily Tribune, May 14, 2017

Leave it to an independent businessman to get so fed-up with the rising costs of his employee health plan that he hired a documentary film crew to get to the bottom of things. The result is “Big Pharma: Market Failure,” a new documentary that takes a deep dive into profiteering by the pharmaceutical industry and concludes this sector of our economy is a real and imminent threat to American business.

The first free local public screening will be at the Columbia Public Library on May 18 at 3 and 6 p.m. with a panel of experts. We invite you to attend and tell your story.

Riding a forklift along the warehouse floor with CEO and producer Richard Master, you learn that the company’s rise in cost of health care coverage from one year to the next amounts to $4 per employee per hour. The film also tells us that a third of Master’s health care costs are for prescription drugs, and it’s no longer unheard of for an employee with a chronic condition to be placed on medications that cost twice the employee’s annual salary.

The predicament faced by Master’s company is playing out all over the United States, in businesses small and large.

Things haven’t always been this way. Passage of Medicare Part D was a windfall for PhARMA, the organization that represents pharmaceutical manufacturers. While seniors gained some prescription drug coverage, the industry got a big infusion of elderly consumers. And if that weren’t enough, drug companies also got a nifty gift in the legislation called the “noninterference clause” that says the government can have no role in negotiating or setting drug prices in Medicare Part D. Medicare pays whatever the manufacturers charge.

Both major party candidates for president in 2016 called for legislation to enable the federal government to negotiate drug prices on behalf of Medicare recipients, as it does for Medicaid and the Veterans Administration.

Though candidate Trump promised to use his negotiating prowess to take on the pharmaceutical manufacturers, he has been remarkably silent on this pledge since meeting with representatives of PhARMA at the White House on Jan. 31. Instead, talk seems to have turned to providing regulatory relief for the manufacturers by speeding-up the drug approval process within the FDA.

Although we need to bring down drug prices, we can’t afford to stifle innovation in the pharmaceutical industry. Yet, having the financial resources to develop new drugs and making a killing in drugs are two entirely different things. The manufacturers say it takes $2 billion to bring a new drug to market. But according to Elizabeth Rosenthal, a Harvard medical school graduate and former emergency room doctor turned New York Times journalist and author of “An American Sickness: How Healthcare Became Big Business and How You Can Take it Back,” the actual price for research and development is a small fraction of this larger figure. That’s because the research development claim includes all of the glitzy television ads and related marketing strategies.

Now that healthcare costs us $3.2 trillion a year and represents 17.8 percent of GDP, you might well feel sucked dry from the bloodletting as you cobble together enough to purchase your medications. If so, you might think these numbers represent a mandate for change. But these figures also tell a second story — that very powerful special interests thrive in healthcare just as it is, benefitting from the status quo — and these people will try to persuade you and your elected representatives to opt for a salve or placebo.

Reining in the profiteering in healthcare will require citizens to come together for the common good and recognize what health economists have long observed: Unfettered markets do not work in healthcare and there are times when government must act boldly on its citizens’ behalf. We are financing a bonanza for pharmaceutical manufacturers and invite you to learn more about what can be done.

Join us on May 18 at the library.

Jan Swaney of Columbia and Ed Weisbart of St. Louis are members of Missouri chapter of Physicians for a National Health Program (www.pnhpmo.org).

http://www.columbiatribune.com…

This health care circus of delusions must face facts

By Robert S. Kiefer, M.D.
Concord (N.H.) Monitor, May 14, 2017

I have been to a fair number of rallies lately in support of sane health care policy. A lot of slogans are bandied about, but I have not heard the following chant go like this.

People: “We don’t want health care!”

Leader: “When don’t we want it?”

People: “We don’t want health care NOW!”

Evidently, however, House Republicans have heard this message from their constituents loud and clear, or so they say. By repealing most of the positive aspects of Obamacare and proposing their own patchwork of fixes, they are acceding to special interests while putting millions at risk.

Few of the House reps have actually read or understand the ramifications of the bill, and certainly the president seemed to conceal from the public any faint semblance of comprehension. Mr. Trump has a merry-go-round of delusions circling in his head, which occasionally stops to pick up an extra delusion or two.

House Republicans, eager to jump on his carousel of crazy, have proposed the end of Medicaid expansion, an end to defined benefits and broad definition of pre-existing conditions, with the end result of pricing many people out of the insurance market. Further, they would toss chronically ill patients into underfunded high risk pools without lifeguards on duty.

The most wealthy among us can treat themselves to Dom Perignon by the case, courtesy of the $700 to $800 billion in tax cuts which they will accrue while the less fortunate struggle for survival in the deep end of the risk pools. Not that he pays taxes anyhow, but Trump gets a Mar-a-Lago-sized break, even as he expends half of his vocabulary on shallow, callous expressions of praise for the bill.

Rep. Raul Labrador of Idaho summed up the Republican position at a Town Meeting when he blurted that “nobody dies because they don’t have access to health care.” Nice one.

And so it falls upon the Senate to add this bill to the compost pile, and to work on comprehensive, affordable health care for all. Sen. Bernie Sanders will shortly save them a lot of trouble by introducing a Senate bill promoting Expanded Medicare for All. The House version, HR 676, now has 108 co-sponsors, though Reps. Kuster and Shea-Porter have yet to sign on.

We must encourage our full congressional delegation to come off the sidelines to speak for us, to be part of a thoughtful solution to the health care crisis, and not part of the circus in Washington.

Dr. Robert S. Kiefner is a retired family physician in Concord and a member of Granite State Physicians for a National Health Program.

http://www.concordmonitor.com…

Re: What the Republican Health Plan Gets Right

By Jay V. Solnick, M.D.
The New York Times, Letters, May 13, 2017

Marc K. Siegel argues that since 5 percent of Americans generate more than 50 percent of health care expenses, they should also pay more. He gives us the gratuitous example of his patient with seasonal allergies who comes to see him unnecessarily every few weeks.

This is absurd. Most of us understand that the reason so few account for so much of our health care costs is not because they enjoy visits to their doctor; it is because they are sick. They are mostly elderly. They have cancer, heart disease or any number of other afflictions that visit us as we age.

It’s really pretty simple: We must each pay into a pool so that if and when our number is called, health care is available. This could come in the form of a plan like the besieged Affordable Care Act, or, better yet, national health insurance like that found in virtually every other developed country, where health care is usually better and always much cheaper.

The writer is an infectious diseases doctor and a professor at the Center for Comparative Medicine, University of California, Davis.

https://www.nytimes.com…

Medicare’s high out-of-pocket costs

Cost Burdens by Income and Health Status

By Cathy Schoen, Karen Davis, Amber Willink
The Commonwealth Fund, May 12, 2017

Abstract

Issue: Fifty-six million people — 17 percent of the U.S. population — rely on Medicare. Yet, its benefits exclude dental, vision, hearing, and long-term services, and it contains no ceiling on out-of-pocket costs for covered services, exposing beneficiaries to high costs.

Goal: To inform discussion of possible changes to Medicare, this issue brief looks at beneficiaries’ out-of-pocket costs by income and health status.

Methods: Spending estimates based on the Medicare Current Beneficiary Survey.

Findings and Conclusion: More than one-fourth of all Medicare beneficiaries — 15 million people — spend 20 percent or more of their incomes on premiums plus medical care, including cost-sharing and uncovered services. Beneficiaries with incomes below 200 percent of the poverty level (just under $24,000 for a single person) and those with multiple chronic conditions or functional limitations are at significant financial risk. Overall, beneficiaries spent an average of $3,024 per year on out-of-pocket costs. Financial burdens and access gaps highlight the need to approach reform with caution. Already-high burdens suggest restructuring cost-sharing to ensure affordability and to provide relief for low-income beneficiaries.

From the Summary and Implications

The high financial burdens documented in this brief illustrate the need for caution. Half of Medicare beneficiaries have low incomes; one-third have modest incomes (200% to 399% of poverty). Any potential policy should first consider the impact on beneficiaries.

Access and affordability remain key concerns. In any discussions of potential Medicare reform, it will be important to pay particular attention to consequences for those vulnerable because of poor health or low income. Indeed, the findings point to the need to limit out-of-pocket costs and enhance protection for low-income or sicker beneficiaries.

http://www.commonwealthfund.org…

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Comment:

By Don McCanne, M.D.

Although President Trump has said that he is going to leave Medicare alone, we have learned that he is not a reliable source for information about pending policy changes. The Republicans controlling Congress have indicated that they want to reduce projected spending on Medicare by privatizing it and switching to vouchers (premium support) in order to ratchet down the government’s contribution to the program. So what does this report tell us about the wisdom of their intentions?

Medicare is already an inadequate program. Instead of cutting the Medicare budget further we should be expanding it to fill in the deficiencies that are leaving Medicare beneficiaries exposed to excessive debt.

The full article available at the link above discusses programs that are used to patch some of the holes, but just as patches are inadequate for the Affordable Care Act, patches have also been inadequate for Medicare, just as this report demonstrates.

We need a Medicare that meets the much higher standards of the “Physicians’ Proposal for Single-Payer Health Care Reform,” and then we need to enroll everyone in it automatically. That’s why we talk about an Improved Medicare for All.

Physicians’ Proposal for Single-Payer Health Care Reform:
https://www.pnhp.org/nhi

Alaska needs a single-payer health care system

By Alan Gross, M.D.
Anchorage Daily News, May 12, 2017

Alaska is in recession and is unable to reconcile its huge deficits, despite a 40 percent cut in government services. Thirty-five percent of the total state budget is now devoted to health care. Alaska employers struggle to keep pace with wages while the cost of providing employee health care benefits skyrockets and are the highest in the world. Many Alaskans remain uninsured or pay small fortunes for private insurance with prohibitively high copays and deductibles. The only reasonable solution to this crippling problem is to adopt a state or national single-payer government health care program.

Alaska health care prices do not simply reflect increased labor, shipping and travel costs — at most only 30 percent more than the same services in other states. Alaska doctors often charge and collect 500 percent or more, than the costs for obtaining the same service outside the state. Alaska utilizes the “80th percentile rule,” which mandates insurance companies pay at least 80 percent of what its providers bill, thereby encouraging medical fee increases with virtually no restraint. Every six months, insurance companies must reevaluate average regional fees to keep pace with this rule.

Cutting the 80th percentile rule to a lower percentage is not the answer. This would only motivate providers to raise their respective rates faster. Also, most specialty medical groups in Alaska lack real competition and have joined to form regional monopolies and set prices at will, leading to upwardly spiraling prices across virtually every aspect of health care delivery.

Doctors, pharmaceutical companies, medical suppliers and ancillary service owners (e.g., labs, imaging, physical and massage therapy) are usually well-meaning, great people trying to do good work. They are not crooks. But, money is very much on the table thanks to our broken system, and health care providers have taken full advantage of this amazing flow of Alaska dollars from the state of Alaska and from the individuals and employers who are paying for incredibly high insurance premiums, into the hands of the health care industry and its providers.

No realistic solution is currently being considered, on either a state or federal level, to adequately control health care costs. Both political parties kick this expensive and politically explosive can down the road, offering us Obamacare, health savings accounts, tax breaks, government subsidies, state reinsurance and other incentives, but these are insufficient and minor adjustments to a terminally broken system. Milton Friedman, a renowned conservative economist, admitted he had “no idea” how to control costs with our current health care system. Don’t blame health care providers, insurance companies, or the health care attorneys.  The problem is the design of our system and it needs to change.

The only solution to Alaska’s health care fiscal crisis is to create a single-payer health care system. A single-payer system will successfully cover every Alaskan, without compromising provider choice or quality of care. This has been successfully implemented in most other first world nations with high satisfaction rates. Moreover, our federal government already offers Medicare to all citizens over the age of 65. It has proven itself successful and efficient in controlling health care costs and pricing with overall high satisfaction. Our current administration in Washington is leaning toward giving individual states more autonomy related to federal Medicaid dollars. This presents a tremendous opportunity for the state of Alaska to work with our federal government to pioneer our own state-run universal health care system.

There is no free market in Alaska health care. There never will be with our current third-party payer system. It does not make us all socialists for our government to fix a broken system. Health care prices are devastating the state’s economy and the state could save hundreds of millions of dollars a year if it self-insures its citizens.

Furthermore, workers will see marked increases in wages once benefit packages become less expensive for employers to provide. No other mechanism can control the prices for health care in Alaska or for the rest of the United States.

Winston Churchill once said, “Americans always get it right in the end, after they’ve exhausted all other options.” It is time for Alaska to get it right.

Dr. Alan Gross is a lifelong Alaskan and an orthopedic surgeon who has practiced since 1994. He also holds a masters degree in public health and is a commercial fisherman. He lives in Petersburg.

https://www.adn.com…

Political divide on AHCA

YouGov, May 6, 2017

As you may know, Republican leaders in the House of Representatives recently passed a new health bill (AHCA). Do you generally favor or oppose this bill?

Favor strongly or somewhat:
Total – 31%
Democrats – 13%
Independents – 24%
Republicans – 69%

Oppose strongly or somewhat:
Total – 44%
Democrats – 70%
Independents – 40%
Republicans – 11%

Not sure:
Total – 25%
Democrats – 17%
Independents – 36%
Republicans – 20%

http://big.assets.huffingtonpost.com…

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Comment:

By Don McCanne, M.D.

This poll is being reported as showing that Americans oppose the Republican repeal and replace health care legislation (American Health Care Act) passed by the House of Representatives. It would be more accurate to state that Republicans and Democrats are divided in their support, but many remain undecided, especially amongst Independents. Neither support nor opposition reached a majority, except within the two major parties.

Unfortunately, the results indicate that political polarization remains strong between the two parties, but that a careful consideration of the implications and consequences of the policy features of the legislation seems to be lacking. That makes the assumption that we should be able to agree on what is better for America – affordable and accessible health care for all, or that individuals need to be empowered to take ownership of their health care or do without.

It is tragic that we reduce public health policies to a battle of political slogans. The health of the nation depends on getting the policies right. Too many of us seem to tune in to what our political leaders have to say, and then parrot their words. What a terrible way to try to craft rational, humane policy.

Many contend that moving forward from a political divide requires bipartisanship – compromise. No, not when both sides are wrong. Merging ACA and AHCA would only perpetuate our high costs, inequities, and wasteful administrative inefficiencies. We need to eject the politicians and move on with crafting reform based on sound policies. Perhaps it’s time to bring the sociologists into the arena.

Now is the time for Medicare for all

Single-payer program saves money

By Jessica Schorr Saxe, M.D.
Charlotte Post, May 11, 2017

Have you—or anyone you know—skipped needed health care because of cost? Since this is true of one in three Americans, you probably answered yes. Do you think this is unfair?

When I worked as a family doctor at Carolinas Medical Center-Biddle Point, I saw people every day who didn’t get needed health care because they couldn’t pay. I don’t think it’s fair. There is another kind of health care system which would eliminate this unfairness.

Amid the talk of health care change—repeal the Affordable Care Act, AKA Obamacare or replace it or improve it—more and more voices are speaking out for improving and expanding Medicare for all. This is also known as a single-payer system.

Why? Health in this country is poor, with lower life expectancies, worse infant mortality (deaths of babies before the age of one), and poorer health than other developed countries. These statistics are much worse for African-Americans than for the general population. And we spend more money than other countries—about twice as much per person as the average developed country. All of those countries provide health care for all, while we do not.

They do it by providing universal access to health care, through some form of a single-payer system. Single-payer health care refers to a financing mechanism by which one payer (either the government or an agency established by the government) pays the bills. Our current complicated system includes payments by Medicare, Medicaid, numerous insurance companies (with thousands of different plans), all of which have different rules. This unwieldy bureaucracy creates headaches—and expense—for patients, hospitals, and doctors’ offices.

We, too, could have a single-payer system if Congress passed HR 676, the Expanded and Improved Medicare for All Act, It currently has 108 co-sponsors, more than ever since it was first introduced in 2003. More than half of the Democrats in Congress, including all three from North Carolina, are co-sponsors. Rep. Alma Adams of the 12th District was the first representative from N.C. to sign on.

HR 676 would eliminate all co-pays and deductibles—so we would no longer have one-third of our country who could not afford needed care.

How would we afford to cover everyone? An article in the Annals of Internal Medicine in February noted that we would save over $600 billion. This would come from decreasing costs of administration as well as lower prescription drug costs. We would fund this program through small progressive increases in taxes.

Don’t like taxes? You are likely to find that you pay much less in taxes than you’re currently paying for health care. And the billions of dollars in savings would allow us to cover everyone.

Think of what health care coverage for all would mean. Everyone would be able to get the care they need and no longer have to make choices between seeing a doctor and paying their other bills. This would allow us to improve the health of our country. Further, we could reduce racial disparities.

Do you know anyone who suffers from lack of needed health care, anxiety over their medical bills, or getting inequitable care because of their financial limitations? Then you, too, should support improving Medicare and expanding it to all.

Dr. Jessica Schorr Saxe is chair of Health Care Justice – NC.

http://www.thecharlottepost.com…

Faso urged to change his vote

By Steffie Woolhandler, M.D., M.P.H., and David Himmelstein, M.D.
The (Hudson, N.Y.) Register-Star, May 11, 2017

Congressman Faso’s vote for the GOP’s American Healthcare Act (AHCA) that repeals much of the Affordable Care Act (the ACA or Obamacare) gravely threatens the health of thousands of his constituents.

The GOP bill would take $880 billion out of Medicaid, and another $312 billion out of subsidies that help working families buy private coverage through the ACA exchanges. Instead of helping people get care, this money would be diverted to give an $800 billion tax-break windfall to people with incomes over $200,000, as well as big insurance and drug companies. The rest of us would get virtually no tax relief.

In Rep. Faso’s district, the ACA has expanded Medicaid by 68,600 and helped another 16,500 afford new coverage through the exchange. All told, his vote threatens to strip coverage from 85,100 people in our district, would weaken protections for people with pre-existing conditions, boost premiums for people over 40, and take tens of millions of dollars from our hospitals and clinics.

The ACA is deeply flawed. It left 28 million Americans uninsured and millions more with unaffordable premiums, deductibles and copayments. But the GOP plan would make things worse. Instead of moving backward, we should move forward from the ACA to a Medicare for All plan like the one proposed by Bernie Sanders and Rep. John Conyers (HR 676).

Rep. Faso can change his vote if the AHCA comes back to the House of Representatives for a final vote after the Senate acts on it. Please urge him to vote “no” next time, and to endorse HR 676. The health of our neighbors hangs in the balance.

http://www.registerstar.com…

Medical debt and personal bankruptcy

How the Affordable Care Act Drove Down Personal Bankruptcy

By Allen St. John
Consumer Reports, May 2, 2017

http://www.consumerreports.org…

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Comment:

By Don McCanne, M.D.

It is reassuring to learn that personal bankruptcies are declining, but we should not extrapolate the conclusion that the Affordable Care Act is responsible for largely eliminating the problem of medical debt. It is still very much with us.

In 2016, about 43.8 million Americans had problems paying medical bills in the past 12 months. A Consumer Reports survey in January of this year revealed that “55 percent of consumers said they lacked confidence that they or their loved ones would be able to afford insurance to secure that care.” Affordability of health insurance and health care remains a major problem in the United States.

It is likely that the expansion of Medicaid and the introduction of generous subsidies for low-income individuals reduced the rate of medical debt amongst the 20 million people who gained coverage under ACA, but the reduction in the rate of personal bankruptcy for the other 300 million Americans was more likely due to a combination of an improved economy and the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 which made it much more difficult to file for personal bankruptcy. (The albatross of life-long debt is another story.)

When over half of Americans lack confidence that they can afford health insurance and almost 44 million are already having difficulties paying their medical bills, we have a problem. It could be virtually eliminated by enacting a well designed single payer national health program – an improved Medicare for all – that automatically includes everyone while removing financial barriers to care. Celebrating ACA is not enough.

Harvard Medical School researchers find limited access to pediatric mental health care in five major U.S. cities

Simulated patient study points to long wait times, bias against Medicaid patients and misinformation by private insurers

FOR IMMEDIATE RELEASE, May 10, 2017
Contact: Clare Fauke, communications specialist, PNHP, 312-782-6006 or clare@pnhp.org
J.Wesley Boyd, M.D., Cambridge Health Alliance, 617-833-1840 or jwboyd@cha.harvard.edu

A new study published in the International Journal of Health Services  found that access to outpatient mental health care for children—whether with a child psychiatrist or a pediatrician—is very limited, even for those with private insurance or the ability to pay out of pocket for care. Almost one-fifth of children and adolescents in the United States suffer from a serious mental disorder, but fewer than half of those needing care receive treatment. Researchers found several roadblocks to obtaining timely care, including longer wait times for psychiatric appointments versus pediatric appointments, a lack of providers accepting Medicaid patients and incorrect contact information provided by the insurer.

The study attempted to replicate the experience of a parent trying to obtain needed psychiatric care for a child. Using the Blue Cross Blue Shield (BCBS) online database of in-network providers, the authors called child psychiatrists and pediatricians in the Boston, Seattle, Minneapolis, Chapel Hill, and Houston metropolitan areas. Researchers called the offices of 601 pediatricians and 312 child psychiatrists claiming to be the parent of a 12-year-old child with depression seeking the earliest possible appointment. The authors altered their proposed method of payment, randomly stating either that they 1) carried BCBS PPO insurance, 2) carried Medicaid, or 3) were willing to pay out of pocket for care.

The roadblocks to care include the following:

  • Longer wait times for psychiatry appointments: Pediatricians were twice as likely to see new patients and to see them sooner than child psychiatrists. Appointments were obtained with 40% of pediatricians but only 17% of child psychiatrists; the mean wait time for psychiatry appointments was 30 days longer than for pediatrics. Research has shown that long wait times for mental health appointments can negatively impact a person’s engagement in care.
  • Limited access for children on Medicaid: Callers were less likely to obtain appointments for children on Medicaid (22%) than for those with private insurance (37%) or the ability to pay out-of-pocket (37%). Measures to increase physicians acceptance of public insurance, such as higher physician reimbursement and decreased administrative paperwork, may help improve access for patients with Medicaid.
  • Incorrect contact information listed by insurer: One of the most common barriers to making appointments was incorrect or outdated provider information listed on the BCBS site, suggesting that insurance companies may not be vigilant about maintaining accurate databases. “Given how difficult it can be for parents to obtain needed mental health care for their children, insurance companies need to ensure that their provider lists contain accurate information and are as user-friendly as possible,” said lead author Shireen Cama, M.D., a child psychiatry fellow at Cambridge Health Alliance and Harvard Medical School.

Analysis: Private insurers lack incentive for improving access to care

Senior author J. Wesley Boyd, M.D., Ph.D., an attending psychiatrist at Cambridge Health Alliance and faculty member in psychiatry and in the Center for Bioethics at Harvard Medical School, observed that under America’s fragmented, for-profit health insurance system, private insurers do not have an incentive to ensure better access to care. “We found that rosters of health professionals provided by insurance companies often include providers who have either left a practice location, are no longer accepting new patients, or simply aren’t listed with a correct phone number,” said Dr. Boyd. “Insurance companies profit when their enrollees are unable to access care, and patients suffer as a result. We need to take the profit motive out of health care and adopt a single payer, Medicare for all system that guarantees care for patients, not profits for insurers.”

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“Availability of outpatient mental health care by pediatricians and child psychiatrists in five U.S. cities,” Shireen Cama, M.D., Monica Malowney, M.P.H., Anna Jo Bodurtha Smith, M.D., M.P.H., Margaret Spottswood, M.D., M.P.H., Elisa Cheng, M.D., Louis Ostrowsky, M.D., Jose Rengifo, M.D., J. Wesley Boyd, M.D., Ph.D. International Journal of Health Services, May 9, 2017. A copy of the full study is available to media professionals upon request from Clare Fauke, clare@pnhp.org or 312-782-6006.

Physicians for a National Health Program (www.pnhp.org) is a nonprofit research and educational organization of more than 21,000 doctors who support a single-payer national health program. PNHP had no role in funding or otherwise supporting the studies or commentary described above.