The Veterans Administration has negotiated drug prices for years. During the Shrubya Administration, some in Congress tried to make the same deal for Medicare. It was, not surprisingly, shot down by politicians on the Big Pharma payroll.
But not to worry. Now Cockholster wants to, essentially, give Medicare recipients a coupon. This is what passes for innovation.
The term âmonopsonyâ which is normal in advanced countries like Switzerland, Sweden or Finland that have large pharmaceutical and drug-discovery operations, appears just once in the report (page 9). And guess what, Americans? Itâs a bad thing according to these people.
Thus, innovators across the world rely heavily on Americans paying market prices to underwrite the returns on investments into products that improve their health because governments abroad use their monopsony power to set prices below market-levels.
In fact, the US is the only modern country that practices this form of economic hobbling. Itâs part of the reason that our inefficient healthcare system costs double the OECD average and fails to cover a large part of the population. The assertion that drug development is financed by the high costs in the US is just unadulterated bullshit.
The plan, outlined before Trump releases his new budget proposal Monday,
focuses mainly on Medicare and Medicaid changes, along with ideas for
speeding drug approvals and fostering competition.
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trump offers up a budget. That gives Congress months to decide on what they will do. The budget for 2019 normally (in past administrations that is) would begin July first. But lately the government has been funded by month long continuing resolutions because the Members actively refuse to do their jobsâŚ
Any bets on if Congress will pass an annual budget in the next 5 months? I think itâs about as likely as finding unicorns on the South lawn of the White House.
Aww, can I have a coupon too??
SheeshâŚ
Pharmaceutical rebates are a big problem in this country. According to their financial reports, the 13 largest pharmaceutical companies in the world paid roughly $133 billion in rebates and chargebacks to U.S. pharmacy benefit managers (PBMs), suppliers and other medical providers (e.g. chemotherapy infusion clinics). See figure 9 of second link.
These incentives (rebate and chargebacks) have driven up pharmaceutical costs in the U.S. relative to the rest of the world in two ways:
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Pharmaceutical companies pay for these rebates by raising the prices of their drugs and
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PBMs will select the medications they âapproveâ not based on their cost effectiveness, but rather on which drug yields the highest rebate.
This system not only leads to skyrocketing brand name pharmaceutical prices, it causes the PBMs, who are supposed to encourage cost effectiveness in their medication selection to do the exact opposite.
The federal fiscal year runs from October 1 to September 30.
Thatâs a bad deal.
But itâs making Donald money.
Welp, Congress sure doesnât seem to care. They used to. But not anymore since the GOP took over. Itâs so toxic these days those folks cannot agree on how to tie their ties
edit
I stand corrected.
Financial analyst and former drug company executive Richard Evans said the administration plan would help bring down costs, but not to the same degree as giving Medicare a direct role in setting prices.
âConvincing the average voter who is upset about drug prices that this is the path to righteousness is going to be a hard sell,â Evans said.
You havenât been paying attention, Evans. Trumpp and the right-wing message machine merely need to repeat over and over that Trumpp has brought huge cuts in drug costs. 32% of Americans will then tell pollsters that Trumpp has brought huge cuts, 20% will say he has brought small cuts, 20% will say prices are about the same, 16% will say costs have gone up under Trumpp, and 12% donât know.
Isn't this a gambit that actually helps some, in this case Seniors, but helps Big Pharma more? Pharma gets to deduct the cost from it's taxes. How does Pharma define the real price of a drug and is that what is being used as a credit for them. There is no such thing as a free lunch, but will Seniors care? As one, I do.These arenât âcouponsâ, and portraying it as another coupon scheme (as with the charter schools and the Medicare replacements which the Ayn Rand wing of Congress has been proposing for the past couple decades) is hurting our argument.
Pharmaceutical rebates are quite insidious. They pay the company which pays a portion of the price of the drug, which company is also completely in charge of which of the drugs is available and used, enough to make their portion cheaper than a competing drug, while leaving the full cost on the patient. The counter argument that those extra funds just make rates cheaper is a transparent shell game; âwe overcharge patients with conditions X and Y so that we can nominally reduce costs for the rest of the population [and take a healthy profit off the whole thing for ourselves].â
Forcing rebates and drug company giveaways to be seen by the patient in the form of reduced copays, in a proportion exactly in line with the percentage of the rebate to drug cost, will force any cost-savings to be shared by both copayers instead of just the one with the most decision leverage.
That said, this could be done incorrectly, and despite the Trump administrationâs stellar record of good governance*, Iâm sure it will. Rules around this area (holy fuck donât call them regulations!) could easily be drafted with the intent of backfiring horribly, causing a seeming reduction in costs at the expense of long-term costs (remind anyone of the âtax cutâ?).
The devil is, as always, in the details. Trump has a lot of devil to spare; Iâm sure heâll hide some in there.
(* I threw up a little in my mouth here)
Heâll be lowering the cost of Oxy and Fentanyl to mere pennies a death.
Run for office- and run FOR something! Donât just run against Trump. Youâll either be preaching to the choir or confirming, in some peopleâs minds, that all âlibralsâ are out to get their man.
Donât just run on lofty campaign ideals, either- get REAL specific. You want to run on jobs or healthcare reform or the new landfill? You must have a plan. THEN you can point out the difference between having a plan and promising to work on a plan sometime in the future.
Remember 7 years of promises to ârepeal and replaceâ? Turns out they didnât have a plan and rushed to a secret hidey hole for 2 whole weeks, cobbling together a 2-legged tripod.
Do better than this. PLEASE! Run for office!
Itâs true to the extent that anyone believes these companies couldnât thrive and continue to innovate on substantially lower US profit margins. Which is, of course, a thing that only the industry lobby and its hired help would believe.
I hate big Pharma. Big Pharma has ruined the medical system here. Big pharma and the hunt for big profits.
My ophthalmologist just put me on a 2d med that costs $140 a bottle of drops and they only last a month. Iâm really furious at that price. Just furious.
Surprisingly good summary from AP. My only real quibble is that of course their framing fucking buries/obscures the headline, which should be something along the lines of âTrump does drug industryâs bidding on drug prices.â I actually doubt this causes even a modest impact on drug prices, but theyâre clearly counting on just enough of a dip that they can check that box and say âPromise fulfilled!â I doubt very much that even the rubes hooked up to a Fox and Friends news-ventilator will fall for this, though (and those people are on some serious medications because theyâre old as hell).
Itâs not just Big Pharma thatâs ruined the medical system. And thatâs exactly what theyâre counting on right now. Theyâre in everybodyâs cross hairs so theyâre playing a blame game and pumping money into polsâ pockets. âItâs not us, itâs the PBMs! Itâs the insurers! Itâs the hospitals!â, they say. And itâs true â every stakeholder in our healthcare system is gouging patients in the name of greater market share or higher dividends or whatever. And every single one of them is pointing fingers at the next.
Yeah well heâs not making it any easier to get old in this country and it already wasnât exactly what youâd call easy.
Well, to be fair -gag- they have to give that excess to politicians, because itâs certainly not going to the development of new drugs and treatments.
To be really fair, there are some miraculous advancements in medicine happening, particularly in genetic treatments and immuno-oncology. But I doubt very much that those advancements would not be happening if drug companies couldnât charge absolutely whatever the fuck a fragmented market glutted with unscrupulous middlemen would bear in America.
And if youâre not a ten-percenter (really maybe a five-percenter), forget being able to access any of those new miracle drugs in the next dozen years or so before they face generic competition.