Later On

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Archive for the ‘Healthcare’ Category

Republicans Aren’t Delusional, Just Dishonest

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Kevin Drum has an interesting post at Mother Jones:

Today Jon Chait writes what must be about the millionth blog post explaining that nearly all conservative criticisms of Obamacare are wildly cherry-picked and intentionally deceptive. In fact, Obamacare is doing pretty well. Not that it matters. Nothing Chait says will have any effect because conservatives just don’t care. Obamacare is bad because it taxes rich people and provides health care to poor people. All the rest is just chaff.

Take this paragraph, for example. It’s about the Cadillac Tax, which partially removes the tax-exempt status of high-end health plans as a way of trying to rein in costs. It was supposed to take effect in 2018, but it’s now been moved out to 2020 because everyone1 hates it:

As bad as this news is for Obamacare, it’s absolutely catastrophic for Obamacare replacements. Every Republican plan to replace Obamacare relies on the same financing mechanism: limiting or repealing the tax break for employer-sponsored insurance. The Cadillac Tax is a smaller, more painless version of this same policy. If both parties can’t abide a partial rollback of the tax break for the most expensive health plans, they’re never, ever going to go along with eliminating the entire tax break for all health plans. The conservatives cackling over the demise of the Cadillac Tax are delusional — it’s as if they’re watching the backlash against the Iraq War in 2008 with fingers tented, anticipating that this will encourage war-weary Americans to support a land invasion of Russia. The bipartisan support for maintaining the tax break for employer insurance will hurt Obamacare, but it can survive. The Republican plans to replace it would all be wiped out.

This would be a devastating point—if all these conservative plans were actually serious. They aren’t. Republicans haven’t the slightest intention of ever enacting any of them. Their opposition to the Cadillac Tax doesn’t show that they’re delusional, it just shows that they’ve never taken their own plans seriously and couldn’t care less if any of them ever see the light of day.

1 Except for health wonks. But nobody cares about them.

Paul Krugman also points out that Obamacare is doing extremely well:

One of the remarkable aspects of the politics of health reform is the way conservatives — even relatively mild, seemingly informed conservatives — have managed to keep believing that Obamacare is unraveling, despite the repeated failure of disaster predictions to come true. Part of the way this works is that captive media and the right’s pet “experts” hype every bit of bad news, but go silent when the news is good (and, often, when the bad news turns out to have been a false alarm.) How many will even hear about the news that enrollments are once again running above expectations, and thepool is getting younger?

Anyway, it’s really helpful to have this new report from the Commonwealth Fund comparing actual performance with pre-implementation predictions. Premiums came in far below expectations; part, but only part, of this positive surprise was given back by 2016 premium hikes, with overall costs still looking very good.

On enrollments: fewer people than expected signed up for the exchanges, but an important reason was that fewer employers than expected ended coverage and moved their employees into the individual market. Meanwhile, Medicaid expanded more than expected — and the overall reduction in the number of uninsured was pretty much in line with forecasts: . . .

Continue reading.

 

Written by LeisureGuy

23 December 2015 at 3:44 pm

The dark side of capitalism: Jacking up the price of old drugs to increase profit

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Capitalism and free enterprise are highly thought of in the US in general, and by the GOP in particular. While it’s fairly common to laud the benefits of capitalism and only a little less common to bemoan government “interference” in the free operation of the mark, common decency and justice obliges us to recognize that capitalism has a very dark side—for example, the 29 miners killed in a mine explosion when Don Blankenship, in the pursuit of greater profits, refused to observe safety standards imposed by the government. Here’s another instance of the downside of capitalism, reported by Sabrina Tavernise in the NY Times:

Fred Kellerman, a retired car salesman from Los Angeles, was bedridden with a rare neuromuscular disease when he started taking a drug in the 1990s at Duke University in North Carolina. It changed his life.

“I had to have a wheelchair to get onto the airplane, but by the time I left, I could walk on,” he said.

Mr. Kellerman has been using the drug ever since, paying nothing but postage. In an unusual act of charity, a small family-run drug company in Plainsboro, N.J., has been giving it away. The drug was never formally approved by the Food and Drug Administration, but was provided under an obscure federal drug provision.

But one company’s generosity is another’s opportunity. Catalyst Pharmaceuticals, a Wall Street-traded company, last week completed an application to the F.D.A. for formal approval of a slightly modified version of the drug that does not need refrigeration. In a presentation to investors last spring, Catalyst estimated that it could make $300 million to $900 million a year from the drug, named Firdapse, that could eventually benefit as many as 8,000 patients. That works out to possibly more than $100,000 per patient.

Catalyst’s move has brought fears among patients of a punishing price increase and led to a recent call from more than 100 neuromuscular doctors for “ethical and just pricing.” Catalyst says it has not yet chosen a price and that patients’ fears are misplaced. Jacobus Pharmaceutical, the private company that has been giving away the drug, says it will also seekF.D.A. approval. The winner is likely to receive seven years of exclusive rights to sell the drug. The F.D.A. does not consider price in its evaluations, though the doctors argue that perhaps it should.

The showdown between the companies powerfully illustrates the growing tension in the United States over the rising prices of drugs. The issue has drawn increased scrutiny from policy makers and prompted rising public outrage, much of it directed at Martin Shkreli, a former hedge fund manager who has become a symbol for pharmaceutical price gouging. Turing Pharmaceuticals, the company he formerly headed, and others have been harshly criticized for abruptly raising the prices of medicines after acquiring them — without having taken the risks involved in research and development.

The neuromuscular doctors who signed an editorial in the journal Muscle and Nerve this month argue that Catalyst is seeking to profit from old medical research. But other experts credit the company with spending the time and money to get the drug approved. That will eventually make it possible for doctors everywhere to write prescriptions, instead of the few willing to fill out paperwork for each patient, said Kenneth I. Kaitin, director of the Tufts Center for the Study of Drug Development.

Catalyst’s drug has been granted special status under the Orphan Drug Act, a law passed by Congress in 1983 to stimulate the development of drugs for rare diseases that would otherwise not be profitable, offering fast-track approval, tax breaks and seven years of market monopoly. But the law has been abused, critics say, with drug companies “salami slicing” more common diseases into small categories, or repurposing older drugs that have been in general use for many years but never had F.D.A. approval, or were approved for different treatments.

“The Orphan Drug Act has been turned on its head in recent years,” said Henry A. Waxman, the former Democratic congressman who sponsored the law. “It has created a special status for orphan diseases that offer large potentials for making generous profits.”

In an analysis published in November in the American Journal of Clinical Oncology, Dr. Martin A. Makary, a professor of surgery at Johns Hopkins University School of Medicine, calculated that 44 percent of drugs approved by the F.D.A. last year qualified as orphan drugs. Prices for orphan drugs have soared, but insurance companies often cover them because they affect such small populations of patients.

“The Orphan Drug Act was intended to promote new drug development, not price gouging of old drugs,” Dr. Makary said. . .

Continue reading.

It’s not totally clear-cut, of course. Things seldom are. FDA approval is achieved only after a fairly expensive process, and until that approval is secured, the drug is barely on the market. Still, Martin Shkreli showed the weaknesses of the purely capitalistic approach in several ways.

Written by LeisureGuy

23 December 2015 at 8:59 am

Breaking the law is perfectly okay if you are powerful and none of the victims is (are?)

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From MuckReads (via email):

Law ignored, patients at risk, STAT

The Food and Drug Administration Modernization Act of 1997 established a federal database for research institutions to report the results of clinical trials. But according to an investigation by STAT, most institutions — including Stanford University and Sloan Kettering Cancer Center — routinely break the law by failing to report.

See also: This post.

And also see also: this news report in the LA Times

And, come to think of it, see also this post, and think about the malicious enchanters who bring to naught all the efforts, even undertaken with absolute purity of heart, of one who truly has given his life, in effect, to the living out of the societal ideals: the way of life everyone admired in the books they read. But, somehow, it doesn’t work out the way it should. So: evil enchanters. But now translate it back into the thing on which the book reflects.

Written by LeisureGuy

19 December 2015 at 10:51 am

An example of the Dunning-Kruger Effect: The common understanding of how Medicare and private insurance interact

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Absolutely fascinating—and carefully argued—article. It is a must-read because it requires must-think. “The Experts Were Wrong About the Best Places for Better and Cheaper Health Care,”
By Kevin Quealy and Margot Sanger-Katz, in the NY Times.

Written by LeisureGuy

15 December 2015 at 11:29 am

The “market” does not work with prescription drugs—government action required

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Ian Reifowitz has a good post at DailyKos:

Did you know that the Senate held hearings December 9 on the outrageous, overnight price increases we’ve seen in recent months on certain pharmaceutical drugs? Yes, yes, the Senators talked a good game. They went after Martin Shkreli—pictured above, who this week was unmasked as the “mystery buyer” who plunked down $2 million to purchase the only copy that will ever be produced of the new Wu-Tang Clan album. He’s also the guy whose company bought a 60-year-old drug and jacked up the per pill price from the cost of a movie ticket to $750. The senators also criticized Valeant, a company best known for having increased the cost of two heart drugs by 212 percent and 525 percent, respectively.

Senators heard from a pediatrician, Dr. David Kimberlin of the University of Alabama, Birmingham, who cares for newborns suffering fromtoxoplasmosis—an ailment that can result in loss of vision or brain damage. Prior to Mr. Shkreli’s decision to, er, adjust the price of Daraprim, it cost approximately $1,200 to treat an infant for toxoplasmosis, a treatment that lasts twelve months. What is the cost now? “No less than $69,000,” according to Dr. Kimberlin. Additionally, in more than 30 instances, physicians had serious problems even getting their hands on Daraprim as a result of the changes implemented by Mr. Shkreli’s company. “Babies’ lives literally hang in the balance here,” Kimblerlin added.

University of Utah Health Care Director Erin Fox explained the impact of the aforementioned Valeant price hikes: “If we continued to purchase the same amount of each drug, it would cost our organization just over $1.6 million more for isoproterenol and approximately $290,000 more for nitroprusside compared to what we paid the previous year.” That’s just one hospital, and only two drugs.

Democrats had more productive things to say than Republicans during the Senate hearings. Missouri Democratic Sen. Claire McKaskill identified the problem as one of avarice: “If this is just greed, we have a duty to figure out how to protect patients who need these medicines.” She continued: “This is a market failure, and when there is a market failure the government has a role in addressing it.”

Republicans, on the other hand, prioritized defending drug companies. Maine Sen. Susan Collins made sure to emphasize that the problem is one of a few bad apples that shouldn’t be allowed to tarnish a whole industry. “As one industry expert I recently spoke with put it, ‘these companies are to ethical pharmaceutical companies as a loan shark is to a bank,’” she said. North Carolina Sen. Thom Tillis —who just this summer demonstrated that he standssquarely in the pocket of the pharmaceutical industry—knows where his bread is buttered, offering, “I don’t believe we should cast all pharmaceutical companies in the same light.”

Overall, Republicans received 58 percent of the industry’s campaign contributions in the past two federal election cycles, compared to 42 percent for Democrats. Perhaps more importantly, big pharma spent seven times as much on lobbying as on direct contributions to politicians, well over $200 million annually in recent years.

As for 2016, Hillary Clinton is the largest recipient of contributions from the industry, although, as The Hill noted, Clinton recently put forth a plan to deal with increasing drug prices. Clinton’s plan would:

  • Stop direct-to-consumer drug company advertising subsidies, and reinvest funds in research
  • Require drug companies that benefit from taxpayers’ support to invest in research, not marketing or profits
  • Cap monthly and annual out-of-pocket costs for prescription drugs to save patients with chronic or serious health conditions hundreds or thousands of dollars
  • Increase competition for prescription drugs, including specialty drugs, to drive down prices and give consumers more choices
  • Prohibit “pay for delay” arrangements that keep generic competition off the market
  • Allow Americans to import drugs from abroad – with careful protections for safety and quality.
  • Require drug manufacturers to provide rebates for low-income Medicare enrollees that are equivalent to rebates in the Medicaid program
  • Allow Medicare to negotiate drug and biologic prices

The Hill pointed out that Bernie Sanders has taken an even tougher line than Clinton. In October’s Democratic presidential debate, Sanders declared, “I would lump Wall Street and the pharmaceutical industry at the top of my list of people who do not like me.” His plan on drug prices includes the following elements:

  • Require Medicare to use its bargaining power to negotiate with the prescription drug companies for better prices.
  • Allow individuals, pharmacists, and wholesalers to import prescription drugs from licensed Canadian pharmacies.
  • Close the Medicare Part D donut hole for brand and generic drugs by 2017, three years earlier than under current law.
  • Prohibit deals that keep generic drugs off the market, i.e., anti-competitive deals – “pay-for-delay” deals – between brand and generic drug makers.
  • Terminate exclusivity—a government-awarded monopoly period—from a drug company convicted of fraud.
  • Require drug companies to publicly report information that affects drug pricing.

In September, Sanders introduced legislation (co-sponsored with Maryland Rep. Elijah Cummings) that “authorizes the Secretary of Health and Human Services to negotiate drug prices with pharmaceutical companies to bring down costs for Medicare drug benefits. The bill also includes tougher penalties for drug companies that commit fraud and bans the practice of brand name drugmakers paying competitors to keep lower-priced generic substitutes off the market. The bill also lowers barriers to the importation of lower-cost drugs from Canada.” I encourage all of you to read Hillary’s and Bernie’s plans, as there are far more details on their respective websites than I’ve included here.

Anyone who would deny the need for serious reforms on drug pricing is either an industry shill or someone who would blindly follow “free-market” ideology right off a cliff. In order for the market to work properly, there must be a functioning relationship between price, supply, competition, and demand. In such a market, when a company tries to charge too much for the golf clubs it sells, consumers can simply buy similar products from another company that charges less. If one company makes the absolute best golf clubs and charges more for them, people can decide whether the benefit is worth the added cost, and choose accordingly. This works for most products, which is why regulating prices is not necessary most of the time.

What we are seeing with these ridiculous increases in certain pharmaceutical drugs is clear evidence that, at least in certain pockets, the market is not functioning properly. When a drug has no competition, there is no ability for the consumer to choose another product. Additionally, when one’s health is at stake, the option to not buy any of the available products does not exist. If one cannot afford any golf clubs, one can just not play frickin’ golf. The demand for a product that will save one’s life, on the other hand, is infinite. It’s important to note that even people with health insurance coverage may well be unable to get necessary drugs when companies implement these kinds of price hikes.

I’m not a drug policy expert, so I’ll leave it to those who are to come up with the specifics. The goal, however, is clear. We cannot allow a corporation to have all the leverage, while the consumer has none. That’s why government action is necessary. Only government can act on behalf of the people as a whole—can promote the common good against private actors whose interests run counter to it, and who wield such a disproportionate amount of power in a given arena that they can overcome any pushback from citizens acting on their own. . .

Continue reading.

Written by LeisureGuy

14 December 2015 at 1:02 pm

The persistence of poor arguments

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In the NY Times Paul Krugman characterizes two species of bad arguments:

Insured v uninsured

In policy discourse, zombies and cockroaches are somewhat different.

Zombie ideas are claims that should have been killed by evidence, but just keep shambling along, like the notion that vast numbers of Canadians, frustrated by socialized medicine, come to America in search of treatment. (It was in a paper about that and other myths that I first encountered the zombie terminology.) Cockroaches are claims that disappear for a while when proved ludicrously wrong, but just keep on coming back.

I think of the notion that Obamacare hasn’t really reduced the number of uninsured as a cockroach; it seemed to me that it subsided for a while after the big enrollment numbers of 2014 and the sharp drop in uninsurance rates. And really, how could you continue to make that claim given the results shown above, which are corroborated by independent sources like Gallup?

But the claim is back, as Charles Gaba notes. He says that Avik Roy’s latest is embarrassing, which I guess it is — but how much more embarrassed can the guy who did the totally spurious work on “rate shock” get? I’d say, rather, that the latest is impressive in the way it uses multiple layers of misrepresentation to obscure what you might have thought was too obvious to deny. . .

Continue reading.

I think the term “cockroach” is spot-on: the arguments run away and hide when light is shed on them, but as soon as attention drifts away, they come back.

Written by LeisureGuy

8 December 2015 at 10:45 am

Posted in GOP, Government, Healthcare

Obamacare is highly successful

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Paul Krugman posts an interesting graph:

Uninsured

His comment on it is worth reading.

Written by LeisureGuy

3 November 2015 at 2:51 pm

Posted in Government, Healthcare

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