One Year After Filibuster, Drug Costs Soaring

Bill Scher

It was nearly one year go when a conservative filibuster stifled the new congressional majority, did the bidding of the pharmaceutical and insurance companies, and kept the ban on Medicare from negotiating with companies to lower drug costs.

So what’s been happening with the private insurers offering Medicare drug plans? They’re jacking up the co-payments for expensive, life-saving drugs. The New York Times reports:

Health insurance companies are rapidly adopting a new pricing system for very expensive drugs … abandon[ing] the traditional arrangement that has patients pay a fixed amount, like $10, $20 or $30 for a prescription, no matter what the drug’s actual cost. Instead, they are charging patients a percentage of the cost of certain high-priced drugs, usually 20 to 33 percent, which can amount to thousands of dollars a month.

According to NYT, nearly all of Medicare drug plans now use this system, shifting steep costs onto the sick. Now private employers “looking for ways to keep costs down” are embracing these plans as well, making this high co-pay drug plan the “fastest-growing segment in private insurance.”

A particularly disturbing part of the story: the Bush administration trying to tell the spouse of a federal employee — who just had her drug co-pay from Kaiser suddenly skyrocket from $20 to $325 for each prescription — why it offers such a costly plan.

She immediately asked Kaiser Permanente why it had changed its plan.

The answer came in a letter from the federal Office of Personnel Management, which negotiates with health insurers in the plan her husband has as a federal employee. Kaiser classifies drugs like Copaxone as specialty drugs. They, the letter said, “are high-cost drugs used to treat relatively few people suffering from complex conditions like anemia, cancer, hemophilia, multiple sclerosis, rheumatoid arthritis and human growth hormone deficiency.”

And Kaiser, the agency added, had made a convincing argument that charging a percentage of the cost of these drugs “helped lower the rates for federal employees.”

Now that’s negotiating!

So, let’s review.

First, conservatives in the Senate prevent Medicare from negotiating for lower drug prices.

Then, conservatives in the White House “negotiate” to shift the high cost of drugs onto the sickest members of their federal workforce and their employees’ families.

Finally, employers see the great work the Bush administration has done in shifting those costs onto employees’ families, so they follow its lead.

Clearly, the conservative policy of doing whatever the drug and insurance companies want hasn’t successfully provided quality affordable health care for all Americans.

It’s going to take a change in policy from the top, and the end to conservative obstructionism, if we’re going to have a healthier nation and a stronger economy, so employers and employees can thrive.

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