Killing American Healthcare: We’re Failing to Solve the Wrong Problem

Killing American Healthcare:  We’re Failing to Solve the Wrong Problem

The goal of reasonable, affordable health care for all American citizens, to borrow Susan Milligan’s metaphor[1], is on life support in the Republican-controlled Congress, kept alive by feeding tubes.

What We’re Ignoring: A Healthy Patient

The current Republican Health Care Act seeks to solve the challenge by radical, high risk amputation whose aim is to kill the disease, even if it costs the patient his life. (We should be calling the GOP plan “McConnellcare,” not “Trumpcare,” since President Trump has little interest in or mental capacity for actually making good on his promise “to have something that’s really good and that people are going to like.”)[2]

The current treatment, the Democrats’ Affordable Care Act, by the same analogy, amounts to keeping the patient alive by an unsustainable-, expensive regimen of drugs with lots of damaging, unanticipated side effects.

But the patient is dying. Conservative Congressional Republicans are, in effect, now saying “We’ll let the patient die, but preserve the brain.” The liberal Democrats’ response: “We’ll let the patient die, but preserve the heart.” Either way, the patient is dead.

What’s wrong: neither the Affordable Care Act nor the latest GOP version of healthcare Mitch McConnell is desperately trying to get passed by the Senate actually deals with the illness. Even worse, neither has any ability to deliver what’s really needed: a patient capable of enjoying robust, sustainable health.

We’re Just Making a Sick Patient Sicker

The core of the problem: Constantly escalating, uncontrolled increases in the cost of drugs, unregulated discrepancies in the cost of medical services, and equal discrepancies in what insurance companies pay to compensate patients and providers for these out-of-control costs.

Healthcare in the United States right now simply costs more than it needs to – or should.

Drug Companies’ Exorbitant Price Increases

Unlike every other industrialized nation, the US doesn’t set limits on what drug companies can charge for their medicines, so drug manufacturers are free to jack up prices – and profits – as high as they want. [3]

Today, prescription drug expenditures are nearly 20 percent of health care costs and growing faster than any other part of the health care dollar. American spending on prescription drugs increased 13.1 percent in 2014—the largest annual increase since 2003. This uptick was largely driven by an unprecedented 30.9 percent increase in spending on specialty medications – you know – the ones we see constantly advertised on TV. Specialty drug pricing alone is far outpacing the Consumer Price Index and specialty drugs are expected to increase to 44 percent of overall drug spending by 2017.

To give just one of dozens of examples, since 2007, Lyrica has helped treat the pain of those who suffer from fibromyalgia. In 2014, the drug was Pfizer’s top-selling drug and brought in $5.17 billion in sales, and in 2015, the drug was the pharmaceutical giant’s second-best selling drug bringing in $4.8 billion. The price of the drug increased by about 51 percent over the three years, which produced $208 million sales attributed solely to the price hike.[4]

Significantly, the drugs that pharmaceutical companies promote most heavily are not ones that can cure a disease, like inexpensive antibiotics; instead, big pharma pushes drugs that lock patients into life- long treatment regimens. [5]

Another example: at $14,600 annually, the PCSK9 inhibitor to treat high cholesterol Praluentm is too expensive for many patients for even one year. Given the nature of the treatment though, most patients prescribed Praluent will be on it for the rest of their lives, skyrocketing the total cost of this treatment.[6]

Prices are rising on some common drugs, too. Four of the top 10 prescription drugs in the United States have increased in price by more than 100 percent.

Wild, Uncontrolled Discrepancies Medical Charges

There’s just as little rationale in what hospitals charge for services. The same procedure can vary dramatically from hospital to hospital, even in the same city.

Data being released for the first time by the government on Wednesday shows that hospitals charge Medicare wildly differing amounts — sometimes 10 to 20 times what Medicare typically reimburses — for the same procedure, raising questions about how hospitals determine prices and why they differ so widely.

From among a myriad of examples: A hospital in Livingston, N.J., charged $70,712 on average to implant a pacemaker, while a hospital in nearby Rahway, N.J., charged $101,945. In Saint Augustine, Fla., one hospital typically billed nearly $40,000 to remove a gallbladder using minimally invasive surgery, while one in Orange Park, Fla., charged $91,000. In one hospital in Dallas, the average bill for treating simple pneumonia was $14,610, while another there charged over $38,00.

Robert Zirkelbach, a spokesman for America’s Health Insurance Plans, the nation’s largest association of health insurers, said some member companies were reporting sharp price increases of 20 to 30 percent for some services. Some insurers are seeking similar price increases from policy holders. “There’s very little transparency out there about what doctors and hospitals are charging for services,” Mr. Zirkelbach said. “Much of the public policy focus has been on health insurance premiums and has largely ignored what hospitals and doctors are charging.”[7]

Equally Uncontrolled Reimbursement Practices

Finally, the same focus on profits over reason applies to how insurance companies. While every hospital has its own master list of charges for different services that differ from hospital to hospital, insurance companies don’t pay those listed charges. The listed charges are almost fiction. Instead, each insurer negotiates for lower prices with each hospital and doctor on every plan. The negotiated prices even can vary within an insurance company depending on which plan a patient has.[8]

These exorbitant price increases have happened while earnings of most Americans have stagnated. Today’s worker makes what, in today’s dollar, what he or she made in 1997.

Damned If You Do; Damned if You Don’t

So it doesn’t matter if Congressional Republicans and President Trump make good on their pledge to “repeal and replace Obamacare” or if we’re left with the existing ACA. In either case it’s a terrible choice. Either limit health care to the increasingly smaller number of wealthy Americans who can afford it or make it available to all Americans, but at a price tag our economy can’t afford.

What we need is a different President and a different Congress – Republicans and Democrats – who are committed to doing what’s right for all Americans and the country as a whole rather than stubbornly clinging to their illogical and harmful competing ideologies.

We have our first shot at that reformation in 2018 – assuming that as a people we wake up.

[1] “Delayed, Distracted and Divided,” U.S. News and World Report, July 16, 2017.

[2] Transcript prepared by the White House from the President’s remarks to pool reporters aboard Air Force One on the President’s latest trip to Paris.

[3] https://www.economist.com/blogs/economist-explains/2016/09/economist-explains-2

[4] http://www.csrxp.org/wp-content/uploads/2016/04/CSRxP_Facts-of-Rising-Rx-Prices.pdf

[5] The cost of Bavencio, a new cancer drug approved in March, is about $156,000 a year per patient. A new muscular dystrophy drug came on the market late last year for an eye-popping price of $300,000 annually. In 2016, the FDA appproved Tecentriq, a new bladder cancer treatment that costs $12,500 a month, or $150,000 a year. Meanwhile, just five of the top 50 drug companies are spending money on much-needed new antibiotics — largely because these drugs aren’t lucrative, the AARP Bulletin reported in November 2016. “In most cases, people only need to take an antibiotic for a couple of weeks to get rid of an infection. Compare that to medications for chronic conditions — which people go on taking every day for years — and you can understand why drugmakers aren’t particularly interested,” says Erik Gordon, a professor at the University of Michigan Ross School of Business. http://www.aarp.org/health/drugs-supplements/info-2017/rx-prescription-drug-pricing.html

[6] http://www.csrxp.org/wp-content/uploads/2016/04/CSRxP_Facts-of-Rising-Rx-Prices.pdf

[7] http://www.nytimes.com/2013/05/08/business/hospital-billing-varies-wildly-us-data-shows

[8] http://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/Medicare-Provider-Charge-Data/index.html

http://www.npr.org/sections/health-shots/2014/11/15/364064088/they-paid-how-much-how-negotiated-deals-hide-health-cares-cost

 

 

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