Here’s why the United States has no hope of managing health care costs

Nobody wants any limits or restrictions on the health care they receive … and they want someone else to pay for it.

Where did it come from?

The Mass proposal is entirely reasonable. What they are saying is that if there are several different drugs treating a condition, a class of drugs, only the one most effective and with the lowest price, will be available. This does not prevent patients receiving needed medication, it manages costs more effectively. Employer plans do this routinely by charging different co-pays for generic, brand and brand formulary drugs.

Of course drug companies don’t like the idea. It creates more competition both on price and medical efficacy. The “consumer advocate” point of view reflects the naive way many, probably most Americans feel about health care.

WASHINGTON — Massachusetts, which led the nation in expanding health insurance coverage, now wants to rein in the growth of prescription drug spending for low-income people on Medicaid, but its proposals have met an icy reaction from patients and drug companies.

The state has asked the Trump administration for permission to limit the number of drugs that will be covered in its Medicaid program, seeking to exclude “drugs with limited or inadequate evidence of clinical efficacy.”

The proposal has nationwide implications because many states are struggling with the costs of health care, including prescription drugs. Massachusetts officials say the decision on their request for a Medicaid waiver, which could set a national precedent if it is approved, will show just how serious President Trump is about his vow to bring down drug prices.

Consumer advocates and drug companies have mobilized a campaign to block the proposal, telling the administration that it would deprive Medicaid beneficiaries of access to innovative, lifesaving treatments.

Moreover, they say, it would be a radical departure from a “grand bargain” struck 28 years ago: Medicaid covers nearly all of a company’s prescription drugs if the company agrees to provide deep discounts to Medicaid. . .

To manage the rising drug spending, Massachusetts — under Gov. Charlie Baker, a moderate Republican — says it wants to use the same tools that have been widely employed by commercial insurers. State officials want to establish a list of covered drugs — what they describe in their proposal as “a commercial-style closed formulary with at least one drug available per therapeutic class.”

With the ability to exclude drugs, the state said, it will be able to negotiate better deals with drug manufacturers, guaranteeing them additional sales for the drugs it does cover, in return for larger discounts, or rebates.

“State officials want to be able to exert the market leverage they believe they should have as a very large purchaser of prescription drugs, without being constrained by what they see as arcane and obsolete federal rules,” said Tom Dehner, a former Medicaid director in Massachusetts.

Massachusetts said it also wanted to “use its own rigorous review process” to identify new drugs whose clinical benefits have not been proved. In this way, it said, “the state could avoid exorbitant spending on high-cost drugs that are not medically necessary.” SOURCE: New York Times 3-31-18

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