THIS WEEK'S POWER PERSPECTIVE

Stay Engaged on the Drug Cost Debate

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The uncertainty over healthcare created by Washington is unnerving, even threatening to patients who depend on insurance for care. Who can afford the massive hospital bills, doctor bills and costs of prescription drugs without insurance? And with insurance, as it currently stands, who can afford the enormous co-pays and co-insurance requirements?

Something must be done!

That means we must be engaged. As Andrew said in a recent interview on the Relentless Health Value podcast, “When you see the family unit as the patient, then you see they’re going to use new tools to have a louder voice and get what’s best for them.” 

But to be effective, we have to be informed and healthcare is very, very complicated. It’s like a game of jenga - pull out the wrong piece and it all collapses.

LOWER PRICES VS. FEWER DRUGS

For example, CNBC reports, “Democrats are proposing an independent agency to tackle the high cost of prescription drugs. The director would be … charged with investigating drug manufacturers and able to slap fines on companies with exorbitant rate hikes … The plan would revamp Medicare by allowing the program known as ‘Part D’ to negotiate prices directly with drugmakers.” 

That sounds reasonable, and perhaps much of it is, but the Washingtion Examiner reports: “allowing the government to ‘negotiate’ with drug companies … is window dressing for government-imposed price controls.”

If price controls are imposed, investors will move their money into other areas which will give them a great return on their investment, and the article warns that, “A 40 percent price ceiling on drugs will lead to a 30-60 percent reduction in research and development for new drugs.”

Fortunately, the article suggests a way out: “To protect consumers and producers, a better path would be to reform regulatory procedures to speed up research, while keeping in place vital safeguards for consumers.”

THE FDA SUPPORTS NEW EFFICIENCIES

The new FDA commissioner Scott Gottlieb agreed about regulatory efficiency during a recent interview:

“Instead of doing… 100 patients in pancreatic cancer for this driver and getting approval there, 100 in liver cancer, and 100 in lung, you do a basket trial where you include a certain cohort from each of the cancers, you put them into one trial and that’s how you reach this efficient end to have the statistical power you need, rather than doing individual trials. It’s a concept in oncology that’s been used, but I think it’s a concept that we can apply more broadly to different areas.”  

STATES TAKE ACTION

While Washington fiddles the states are on fire with ideas:

The Wall Street Journal reports, “Maryland is the first of about 30 states weighing bills to pass a new law on drug pricing. The law, scheduled to take effect in October, outlaws ‘excessive’ price hikes on generics and gives Maryland’s attorney general sweeping powers to roll back price hikes and fine companies for violations. Bills with similar enforcement mechanisms have been introduced in several other states, including New York, Missouri, Massachusetts, Maine and Rhode Island.”

In California, there is a political push for single payer insurance, so-called “Medicare for all”. As Paul Song, MD, Co-Chair of the Campaign for a Healthy California says, “One thing remains indisputable. Our state’s health care system is woefully incomplete for millions of its residents and remains on shaky ground.” 

LET THE PATIENT BEWARE

While it is tempting for states to reign in drug prices and place insurance in  the hands of the government, as we quoted previously from the Washington Examiner, a price ceiling on drugs will lead to a reduction in the development of new drugs. And while places like Canada and the UK pay less for their medicines with government-provided healthcare, that means they have fewer medicines available.

In the UK, the Daily Mail reports, “An American woman's chances of developing breast cancer are slightly higher than her British counterpart - but she is far more likely to survive … If the cancer is caught early …  an American woman has a 97 per cent chance of being alive five years after diagnosis. In Britain, this figure is only 78 per cent.” 

We’ll have more to say about all of this in the coming weeks. But for now, as we said at the beginning, stay informed and stay engaged. Find the facts and ignore the rhetoric. If the patient cannot do this, put a family member in charge. And remember, we’ll do our best to help you along.

~Andrew and Esther Schorr

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Page last updated on August 2, 2017