If big pharma charged ridiculous amounts of money for new drugs, made off-patent drugs dirt cheap, and didn't find new & ridiculous ways to re-patent old drugs, I'd feel better about their business model.
My understanding was that the drug owner had a 7 year exclusive window before the drug was released to public domain. At which point I would’ve expected the drug to be sold near cost.
If it’s possible to re-patent a drug, then obviously that process would break.
FWIW, 7 years of high prices in exchange for having the drug forever afterward feels like a theoretically good solution to me.
Caveat: I know very little about this. ;)
Vimovo, on the other hand, is routinely charged to insurers by pharmacies at prices ranging to over $3,000 for a month’s supply. And somehow insurers are willing to pay for it, to the tune of nearly $500 million a year. More details here from ProPublica: https://www.propublica.org/article/horizon-pharma-vimovo-com...
Reading your link it’s actually an interesting story of an absolute fraud designed to thread a perfect path through all the existing regulations and checks & balances.
They would charge outrageous prices for drugs that were just a combination of generics.
They funneled the scripts to a pharmacy they partnered with. Most insurers would not cover the drug, but the pharmacy knew all the tricks. 80% of claims might get rejected, but they made a ton of money off the 20%.
E.g. Anthem is more than free to double the premium on their bronze plan to increase net profits, but then customers are free to swap in bronze plans from Cigna, Kaiser, or any number of competitors that didn't.
This massive price escalation was called out as a definite outcome by progressives seeking a public option at the time.
The percent cap was touted as the fix.
Insurers bought facilities and raising dollar amounts kept revenue near expectations.
Insurers had to scale (i.e. increase costs) after ACA was implemented because number of uninsured Americans went from 18 to 11%.
For example, look at Maricopa County, Arizona. It's like 100km across and includes both a major capital city (Phoenix) and several suburbs with 6-figure populations (Mesa, Chandler, Glendale).
Many of the marketplace health plans* would have networks which focused around central Phoenix. If you wanted to see an in-network doctor or urgent care and lived at the fringes of the county, it was a 30-minute drive or more.
This meant people in the fringes had to pick the few plans that covered nearby facilities, even if there was a significant price difference.
* This was during the first few years of the marketplace. By 2017 or so they were basically down to a single insurer, so even that degree of consumer leverage was gone.
Networks take people in and out of the chain of care providers, and costs swing dramatically.
The whole affair adds zero value when compared to simpler Medicare For All type plans.
People in my life got sick, and the financial carnage has gone on for decades.
This pretty much rules out any favorable view on markets and private insurers I may have. And I am by no means a unique, or even uncommon case.
If it were not for family, I would have picked up and left this cruel system a decade ago.
I'm not sure what M4A has to do with this, and, in particular, to relate this story back to the thread, you should be aware that Medicare drug benefit administration is also privatized, and that somewhere between 1/3 to 1/2 of Medicare recipients also get Medicare Advantage, a private insurance rider to Medicare that is largely defined by network restrictions.
Millions of Americans have and are being harmed financially and or physically by this patchwork mess.
The other thing you notice is insurers treat people who they know will cost them much differently.
M4A will centralize most of this and will distribute cost and risk as widely as possible
Those things simply do not add value. They do help to make more money.
When health care is about making money, it is not about making people healthy. And it is not about cost either.
Very large numbers of Americans are both impacted in a negative way, and long past the idea of private insurers being good primary care vehicles. They aren't.
Private insurers should be forced out of primary care. If I had my way, doing that would be illegal.
There is a basic conflict of interest between an insurer making money and what is best for sick people.
I will tell you personally, the hell I have gone through, family members dead, others living with pain, financial damage, homes lost, I am very highly motivated to do all I can to see an end to our current, increasingly cruel and ineffective system. Talk about death panels. Yeah, happened to us. Unnecessary that it did too.
The original intent of Medicare is intact in the proposals a growing number of people are moving to actualize.
I am not coming up with "any policy"
I am contributing to the Medicare For All effort.
Does that clear things up?
I just reread this, and the TL;DR:
For very large numbers of people, the current arrangement simply isn't acceptable. The pain level on that has reached a point where those people are now motivated politically.
Medicare For All is an expansion of Medicare, and an augmentation.
Technically, part of what you said is right: Medicare is being used to reference policy modeled on, but does expand considerably on that which we know as Medicare today.
That's being done because people largely understand and like the part of Medicare being expanded on, and that's the part sans private insurers and the usual mechanics associated with all that.
The Dem front runners are looking to garner those health care votes. They aren't wrong to be doing that as for increasing fractions of those votes, a solid proposal that eliminates the harm potential present in our current system is a litmus test.
Cheers!
Insurers compete on the employer market for premiums. If you keep jacking up your premiums, you may find an employer dumps you.
And the pool of money is finite. Getting a better deal on a drug means you have more money to spend on other care that might get you more members.
That said, I agree the 80/20 ACA law is a stupid way to try and control costs.
The problem with that is there's no cap on what premiums should be. So if you charge 10K in premiums, and keep 2K, there's nothing in the ACA that is preventing you from raising your rates to 15K to keep 3K.
Please correct me if I misunderstand how this works.
[1] https://www.healthcare.gov/health-care-law-protections/rate-...
It may be a better marketplace than before, but it's still a pretty shitty marketplace.
Blue Shield of CA has plans available in the full region for each of CA’s 19 pricing regions, and is the third largest insurer in the state.
If it's trivial to take these cheap drugs and mix them, then why don't people simply do that?
[0] https://www.econtalk.org/robin-feldman-on-drug-patents-gener...
If that doesn't work they slightly alter stuff like dosage per pill and re-patent that.
The way this works in practice is that there is a stream of patents on incremental improvements. Doctors continue to prescribe the branded, patented drug (because they have no reason not to) even though the original drug was fine.
Insulin is like this. If there was a substantial market for the 1923 bovine insulin produced by Eli Lilly, it would be cheap. Instead, insurance is willing to cover the high prices of newer, incrementally better versions. Leaving a relatively small market for a worse, but patent free version.
There are of course good arguments against, but there's at least some good arguments to allow limited patent extensions.
Basically anyone can apply to the NIH for a grant to run clinical trials. It's not easy: the funding rate for NIH grants in general is in the teens and you'll need to convince the reviews that a) the trial itself generally makes sense and b) you, specifically, can pull it off, but it can be done.
If you find a new use for an existing drug—and run a trial to prove it—the FDA will give you a period of "marketing exclusivity", wherein you will be the only one allowed to market that drug for that condition. It's not quite a patent, but it's meant to be a similar recompense/reward for doing the research.
What's preventing them? Safety, efficacy, and fear of litigation.
That’s what happens now, for the most part. Drugs that were cutting edge 7-10 years ago are now public domain and damn cheap, like 95-97% discount to the brand name.
Of course there are exceptions, but it’s generally how it pans out.
I don't like the ideological warfare which takes place while many times the problem is of cronyism, cheating.
The insulin from 30 years ago is available and cheap, but no one wants to use it because the newer insulins make it easier to control your blood sugar.