Posts tagged: Congress

Politics of drug prices

(331) Sunday, August 13, 2017 — This true story served as a “joke” about health care over the last eight years.  Now we know, the incident reflects more on our unwitting use as health care pawns.

There should be nothing funny about powerful, ruthless people getting richer by shorting our good health.  We are saps.  We pay more for our drugs, and sometimes go without.  In the United States, this deadly game is played out under a pseudo “free market” umbrella.

In the remainder of the world, government regulates lower prices on the same drugs.  Many prescriptions that prolong life or make ailments more comfortable are cheaper in other countries.

Statistics, such as mortality rates and access to health care, indicate citizens of these other countries are healthier.  We are told lower costs and better results are not compatible.

Four Canadians were imbibing in a Chicago piano bar at the height of the legislative battle which would eventually produce Obamacare.  They feared U.S. political leadership was finally getting its collective health care act together.  To keep costs down, Canadians believed, we would demand government payers of health care benefits be required to seek the lowest prices for pharmaceuticals.

Huge profits from U.S. drug sales provided most of the funds for research and development.  Cheaper drugs here, however, meant prices would rise elsewhere.

By 2009, there was small chance Congress would scrap the Medicare monopoly President George W. Bush gave Big Pharma in 2003.  Bush banned the government from negotiating the price of drugs in the Medicare Modernization Act of 2003 (MMA).  Medicare was the single largest purchaser of drugs in the United States.

President Bush intended MMA to force users and prescribers to demand generic drugs that would keep the overall cost of pharmaceuticals lower.  Big Pharma, of course, welcomed the “no bid” feature.

What Bush did not see was Big Pharma’s intentions to reduce the impact of generics in the marketplace.  Patent protection was extended to 20 years.  Even then, smaller drug firms battled fiercely to get their generics recognized and accepted.

The worried Canadians needed to know that (a) big Pharma had “bought” Congressional support for this gift, and (b) once our politicians were “bought” they stayed “bought.”

Higher prices in the states not only provided huge profits, but also paid for research and development.  If that balloon should burst, Canadians and millions of other foreigners would see major increases in their drug prices.

Drugs play a major role in turning us into a nation of “Haves” and “Have-Nots.”  If you have personal wealth or your employer provides “Cadillac” coverage, chances are you and your family will live better and longer.

Just who are the “Haves?”  How about the following loosely grouped beneficiaries?

  1. Scientists who invent the life-saving (or at the least, life-prolonging) pills, fluids, salves etc. for a profit.  This group should also include the scientists who are paid by the drug companies to publish studies that encourage more drug sales and bury data of any negative effects of these wonder drugs.
  2. Pharmacy companies, restricted by price controls everywhere on the planet, except here in the U.S.A.  The top concern of any business is stockholders’ value.  Also included in this subgroup are Pharmacy Benefit Managers who control the artificial price spread in the United States, first for their own benefit and, second, for the benefit of the drug makers.
  3. Throw in people with good paying jobs and great benefits.  Their health care is paid by the employer with pre-tax dollars.  If you pay for your own health care, most likely it is with after tax dollars.
  4. Finally, there are the street players.  High prices and no regulations create another market for illegal drugs.  Don’t forget the many police, prosecution, prison and court personnel needed to chase and contain these lawbreakers.

If you are not in any of the preceding classifications, you gain absolutely no benefit from higher drug costs.  Instead, you contribute to these groups.  Some would say you are extorted by them.

Of course, the argument can always be made that the high prices you pay for drugs enables our leaders to make good will foreign relations elsewhere.

Bottom Line:  What needs to be explained, however, is what is the benefit to us of paying more for drugs than Canadians?

Nearly forgot the butt of the joke.  The Canadians visiting Chicago had to be reminded when U.S. politicians are bought, they remain bought.  Truth is that President Obama and proponents of the Affordable Care Act spent little or no time debating cost of drugs.

Poll after poll shows we put a high priority on the higher cost of health care.  Yet, presidential candidates rarely touch on the subject.

Dr. Erwin Montgomery, world renowned neurologist practicing in Toronto and Greenville, PA., and dual citizen, contributes the following:

Speaking more comparatively of Ontario Province, “There are resource limitations which in itself is not necessarily a bad thing when limitations affect everyone with favor.  However, limited resources require some prioritization and that seems to be what has escaped adequate attention in Canada.

In the U.S., prioritization is about who has the money.  One of the most dramatic impressions I have about Canadian healthcare is not the fear of personal bankruptcy because of health issues.  This is a strong fear in the U.S.