Unsilent Generation

Entries from March 2010

Docs and the Drugs They Push

March 30, 2010 · 2 Comments

As I wrote earlier in the week, members of the medical profession are moaning and groaning about how once again they are taking an unfair beating at the hands of the mad socialists in Washington. For years now docs have been acting as salesmen for drug companies, in some cases,working with the drugsters to outmanuever FDA regulations–not that it’s very difficult to outmanuever that regulatory body which has become little more than an industry pr shop.

Hopefully the Sunshine Act, which is part of health reform legislation, and which requires drug companies to disclose who they buy research from and for how much, will help put a stop to doctors as drug  salesmen. The problem is horrendous. On March 14, the Milwaukee Journal Sentinel ran a lengthy detailed account of the relationship between Wisconsin doctors and the drug industry. It is well worth reading in full. Here are a few bits:

When looking for a doctor to travel the country and tout its costly prescription fish oil pill, GlaxoSmithKline didn’t select a heavyweight university researcher.

Instead, it wrote checks to Tara Dall, a Delafield primary-care doctor who entered private practice in 2001.

For just three months of speaking engagements last year, GlaxoSmithKline paid Dall $45,000, ranking her among the most highly paid of more than 3,600 doctors nationwide who spoke for the company, which released records for only one quarter of the year…..

Dall hedged when asked in an interview if she fully disclosed her financial relationship with GlaxoSmithKline to all the patients for whom she prescribes the company’s high-priced fish oil product, known as Lovaza.

“I think I would (disclose) if I was going to do anything off-label,” she said. “Whether I tell every single patient, I’m not sure.”

The next day she called back and made a short statement, but hung up without answering questions.

“It is absolutely disclosed to patients that I am a speaker and that I speak for pharmaceutical companies, and it is listed on my Web site,” she said…..

The story describes the cozy dealings between companies and docs, citing other cases, before returning to Dall:

According to her résumé, Dall does talks for five other drug and medical companies in addition to GlaxoSmithKline as well as community talks, including an unpaid speech on heart disease she gave to General Electric Co. employees in Wisconsin last August.

There, she made an eyebrow-raising statement about heart disease.

“As soon as we identify what puts you at risk, we can absolutely fix it,” Dall assured them in the talk, a video of which is posted on her Web site. “We can totally prevent cardiovascular disease from happening. We can completely trump genetics.”

That’s wrong, according to Steven Nissen, chairman of cardiovascular medicine at the Cleveland Clinic, and Raymond Gibbons, a professor of medicine at the Mayo Clinic in Minnesota.

At best, cholesterol-controlling statin drugs reduce heart attacks and strokes by about one-third, Nissen said.

“We cannot trump genetics,” Nissen said. “If she was right, we could wipe this disease out just by giving drugs to people. Even if we put statins in the water supply, cardiovascular disease would still be the leading cause of death.”

Share

Categories: drug industry · economy · health care
Tagged: , , , , , ,

Time for Some Faux Financial Reform

March 29, 2010 · 2 Comments

The pitched battle over health care reform, won with considerable ease as predicted here long ago by the insurance, drug, and associated medical industries, can be viewed as just a warmup act for the fight over  financial reform. As the main event draws near,  eager reportorial eyes are supposed to turn to the awesome spectacle of Ben Bernanke’s Fed policing itself in the interest of protecting consumers. No. This is not a play by Dario Fo.

The base issue here is how corporate America can screw more money out of the middle and lower middle classes. They weren’t about to change health care and they sure as hell are not going to give up their authority over the nation’s wealth.

So what’s this all about? Very simply put, it is about reducing middle class America’s income by cutting entitlements. And that starts with Social Security.

Dave Lindorff on Counterpunch very neatly captures the moment:

The corporate press is weighing in with  dire warnings that this year, six years ahead of what had been predicted only a few years ago, the Social Security system would be paying out more in benefits than it takes in from the payroll tax. The reason for this earlier-than-anticipated event is the Great Recession, the paper explained. 

Well yeah. If you were 62, or 65, and you had lost your job, with no likelihood of it’s coming back, wouldn’t you, once your unemployment checks ran out, opt to start your retirement earlier than planned, so you’d at least have some money coming in each month?  Oh, and with 10 percent of the work force currently unemployed (actually close to 21 percent if you count the people who have given up looking for a nonexistent job, and those who have taken some low-paid part-time work out of desperation), there is a lot less money being paid into the Social Security Trust Fund. So with beneficiaries rising faster than anticipated, and the total national payroll in sharp decline, of course things have gone negative for Social Security earlier than originally anticipated.

So what to do about it?

Hank Paulson and Pete Peterson are both calling for benefit cutbacks, an older retirement age and other attacks on the system. Paulson of course is the the guy who as Treasury Secretary under President George W. Bush, helped engineer the real estate bubble that brought the economy to its knees, and who then engineered the sweet deal that helped his former company, Goldman Sachs, come out of the crisis as the nation’s biggest bank, fattened by tens of billions of taxpayer bailout dollars. Pete Peterson, the former ad exec turned self-described economic guru has been a perpetual doomsayer about Social Security, calling for its privatization.

But really, what’s the crisis?

A wave of Baby Boomers is about to start retiring next year (actually for those born first, in 1946, who decided to retire early at age 62, Baby Boomer retirement began in 2008), but that’s a demographic wave that will eventually pass. In the meantime, financing the benefits for Baby Boomer retirees simply means that current workers–the Baby Boomers’ children and grandchildren–will have to pay more in payroll taxes. Or–and this is what has people like Paulson and Peterson scared–Baby Boomers and their allies among younger workers, may decide to use their unprecedented electoral clout to take those extra tax payments not out of younger workers, but out of their employers. There is, after all, no legal, theoretical or even mystical reason why the Social Security payroll tax should be split 50/50, with half being paid by the worker, and half by the employer. It could easily be a 40/60 split, with the employer paying 50 per cent more than the worker, or even a 30/70 split. That is a political question. Likewise, there is no reason on earth why the payroll tax should be set at the same percentage rate for all income levels, as it is now, instead of progressively calculated, so that high-income workers would pay a higher percentage of income into the fund than low-income workers. And finally, there is no reason why the income subject to the payroll tax (the FICA tax on your W-2 statement) should be capped (currently at $106,800), or why investment income should be exempt.

The so-called Social Security funding “crisis,” which has Republicans and many Democrats warning of the system’s looming “insolvency” as though Social Security were just another AIG, could be solved simply by just eliminating the income cap, and taxing investment income.

Oh, but the conservatives wail, if we raise the payroll tax, America will become uncompetitive, and our economy will collapse.

How then to explain Germany, where social security as a percentage of GDP is much greater than in the US (40 per cent of Germany’s adult population receive some form of government income, whether in the form of retirement payments, unemployment compensation or disability payments–far higher than in the US)? Despite its high social welfare budget, and its high wages, Germany is the second-largest exporter in the world  after China, and despite Germany’s being a huge importer of goods and services, second only to the US, overall, Germany is a net exporter.

Clearly, the problem with America’s economy is not high social security costs, and the “crisis” facing Social Security is not that it is going to “go bankrupt.” It is simply that the corporate interests in America, and the wealthy, don’t want to have to pay for the system. They want the lion’s share of the funding to be paid by ordinary workers and the poor.

Categories: Social Security · Wall Street / financial industry · corporations · economy · financial crisis / recession · pensions / retirement funds · poverty
Tagged: , , , , , ,

How Obama Helps Docs Clean Up their Act

March 29, 2010 · 1 Comment

Doctors,now bitching about getting screwed by the Obama health reform, ought  to be raked over the coals for turning themselves into  sales people for Big Pharma. A Big Pharma rep–especially a hunk or pretty woman–can appear at a doctor’s office with a box of candy or bunch of flowers for the secretaries or nurses. The door to the inner sanctum of the physician’s office is quickly opened..There, the sale rep chats up the doctors,asking them about their children, where they last took a vacation, and their proverbial game of golf. Then they invite these medical professionals  to a cozy dinner  in a plush but quiet restaurant for a discussion about new research showing how a drug approved for one purpose can actually be used for some other non-appproved purpose. Or the sales person  may issue the doctor an invitation to speak at a medical conference for big bucks, or even better,a deal to receive a lot of money for signing an article he or she  didn’t write.

   Among the little known pluses of the health reform is incorporation of the Sunshine Act which requires drug companies make public the amounts of money they pay physicians for their “services.” What this should mean is that when you go to the doctor and he happily tells you of the latest pill for the “gotta go” problem or a new  pill to control what might just be the beginnings of depression, or some new medicine to manage  eyelash length, you can go to the internet,look him up, and see who has paid her for doing what. In his blog Daniel Carlat,provides the details.Here is an excerpt:

  …. now that the Sunshine Act is officially the law of the land, what, exactly, are its provisions, and how might it affect medicine? … Essentially, the law requires that all drug and device companies report all payments made to physicians and teaching hospitals. This includes money for marketing activities, such as promotional talks and consultation, but also includes research grants, “charitable” contributions (which usually come with some promotional strings attached), and funding for conferences, whether CME or otherwise.

Given that so many drug companies have already published registries of physician payments, one might reasonably ask whether this act was actually needed, and whether it will really accomplish anything new. It was, and it will, and here’s why.

As noted by Eric Milgram on his Pharma Conduct Blog,the existing company sponsored disclosures provide few details and are formatted in such a way that they are “translucent” rather than “transparent.” As a patient, physician payment registries are important because they would presumably allow me to easily look up my doctor, and find out if he or she has been paid to push that new and expensive drug that was just prescribed for me. The current registries don’t provide that level of detail, and they make it hard or impossible to conduct efficient searches.

The Sunshine Act fixes this problem. Companies will be required to report names, addresses, the amount of the payment, the date of the payment, and the precise nature of the “service” provided by the doctor. Not only that, but if the payment was for a promotional talk, the company will have to disclose the name of the drug the doctor was pushing. Thus, for example, Eli Lilly’s current registry would allow you to find out that a doctor made $50,000 in 2009 performing what is vaguely (translucently) described as “healthcare professional education programs.” But the Sunshine Act registry will tell you that your doctor made $50,000 for marketing Zyprexa in 2009. In fact, the Zyprexa speaker’s payments will be broken down by date, so you might be able to discover that your doctor got a fat check exceeding your annual salary on the day before he wrote out a Zyprexa prescription for you.

Categories: health care
Tagged: , ,

Why Medicare Benefits Won’t Fall

March 26, 2010 · Leave a Comment

Additional analysis on what the health care legislation means for older Americans can be found on the website of the National Committee to Preserve Social Security and Medicare. Here are a couple of key points: One is on the budget impact of the reform and why Medicare benefits won’t be cut. The other concerns private Medicare Advantage plans.For the entire statement, go here.

Despite the fear mongers’ claims, Medicare benefits will not be cut to pay for covering the uninsured.  Before health reform, the federal government was projected to spend about $6 trillion on the Medicare program over the next decade.  After enactment of health reform, Medicare is still projected to spend about $5.6 trillion.  That means over the next 10 years about $450 billion less of American’s money will be spent on wasteful tests, haphazard treatment options, wasteful subsidies to private insurance companies and reimbursement policies that drive up costs without improving the quality of care seniors receive.  The rate of growth will be trimmed by about 1.0 percent over the next 10 years, from about 6.8 percent growth rate to 5.8 percent – hardly the destruction of Medicare that opponents have claimed.  

As a result, the lifespan of the Medicare Trust Fund will more than double: its solvency will be extended from 2017 to about 2026.  Medicare will continue to grow to meet the needs of an expanding older population, but it will grow at a slower rate that will more closely match the growth of the rest of the economy.  And because health reform is designed to slow the growth of costs in the entire health care system at the same time, seniors’ out-of-pocket costs will be trimmed without driving providers out of the Medicare program or creating other barriers to care. 

While these improvements are being made, health reform also provides new tools to help crack down on the fraud in the current Medicare program.  For example, by allowing the Department of Health and Human Services and the Internal Revenue Service to share information, it will be easier to stop Medicare payments to scam artists masquerading as legitimate providers.  The health reform legislation also gives the agencies more time to verify that providers are legitimate and that they have provided seniors with the wheelchairs, hospital beds, oxygen tanks and other lifesaving pieces of equipment that they are billing to the Medicare program.  Fraud in the Medicare program hurts us all by increasing costs. 

Many people worry that curtailment of the Medicare Advantage ripoff plans signals the beginning of the end, denying care to millions and–as people always warn whenever there’s government “intervention” in medicine, driving the doctors out of business. Here’s what the Committee has to say about Medicare Advantage:

Making changes in the Medicare Advantage program is another way of restoring the integrity of Medicare by reducing wasteful spending.  Medicare Advantage is the privatized part of Medicare whose growth has been fueled by the massive subsidies enacted in the Medicare Modernization Act of 2003.  Medicare Advantage plans are paid on average 13 percent more per enrollee than it costs to provide comparable care in traditional Medicare.  These subsidies, which cost over $11 billion in 2009 alone, are paid for by taxpayers and by all beneficiaries, whether or not they are enrolled in a private plan.  It is estimated that every couple receiving Medicare, including the 75 percent in traditional Medicare, will pay about $90 in additional Part B premiums this year to subsidize those in the private Medicare Advantage plans.  And although these plans provide some additional benefits, many require much higher cost-sharing from seniors for expensive services such as chemotherapy, extended hospital stays and skilled nursing home care – a shortcoming few seniors realize until they find themselves needing the service. 

Despite what some are claiming, the health reform legislation does not eliminate Medicare Advantage plans or reduce the extra benefits they provide.  The legislation simply phases down the exorbitant subsidies they are currently getting so their payments end up more in line with what it would cost traditional Medicare to cover the same seniors.  It is up to each private insurer to decide how to absorb the reduced payments, and whether to continue providing extra benefits.  The insurers who run Medicare Advantage plans cannot cut guaranteed benefits – they are required to offer all benefits covered by traditional Medicare.  And under the new health reform law, they are now prohibited from charging seniors more than traditional Medicare for expensive services.  They are also, for the first time, required to spend at least 85 percent of their revenue on patient care rather than profits or overhead.  Finally, the legislation rewards Medicare Advantage plans that are providing high-quality care by giving them bonus payments. 

Categories: Medicare · budget / tax policy · health care · health insurance industry
Tagged: , , ,

Health Care Reform Will Not Wreck the Budget

March 26, 2010 · 1 Comment

Perhaps the hysteria surrounding the new health care reform will soon begin to die down. But even then, what will remain is a huge, complicated piece of legislation. To get to its heart, you really have to proceed slowly, step by step, looking into different nooks and crannies. And you have to decide which guides you trust.

The Center on Budget and Policy Priorities, the liberal-minded Washington think tank, has been tracking the changing legislation as it made its way through Congress. So it knows something about the behind-the-scenes manuevering as well as what’s gone on in public. More importantly, the Center is the one think tank which has maintained a firm historic grasp of the shredding of the nation’s safety net over the years, closely paralleled by the growth in income disparities and numbers of poor and struggling Americans. It is conscious of how this sort of legislation actually affects people.

Note to Tea Party adherents: This is not some pinko outfit. It was started by people around Jack and Bobby Kennedy and managed by  public servants who actually ran government programs, and who call on others with the same backgrounds to help figure out what’s what. CBPP has proven year after year to be thoroughly credible. At least, that’s what I think, and that’s why I pay attention to what it has to say and cite it a fair amount of the time.

A new report from CBPP on the budget impact of the health legislation begins as follows:

Despite an official estimate by the Congressional Budget Office (CBO) to the contrary, some critics of the new health reform legislation — such as Rep. Paul Ryan and former CBO director and McCain campaign adviser Douglas Holtz-Eakin — charge that it will not reduce federal budget deficits because it relies on budgetary gimmicks or games. Careful analysis of these charges shows them to be misleading or inaccurate. They do not withstand scrutiny.

CBO estimates the legislation will reduce the deficit by $143 billion over the ten years from 2010 through 2019.  In the following decade, 2020 through 2029, it estimates that the legislation will reduce the deficit by an estimated one-half of 1 percent of gross domestic product (GDP), or about $1.3 trillion. CBO also anticipates that health reform “would probably continue to reduce budget deficits relative to those under current law in subsequent decades, assuming that all of its provisions continue to be fully implemented.

The report goeds on to examine the specific claims–i.e. falsehoods–about the legislation in detail. In particular, it debunks attempts at fearmongering among older people, with claims that the reform bill threatens Social Security. I’ve included some highlights, but you can find the full report here.

Claim: Health reform covers up long-term deficit increases by front-loading revenues and back-loading spending.

Fact: Health reform will reduce deficits in the legislation’s second ten years and in subsequent decades.

In claiming that health reform front-loads revenues and back-loads spending, critics selectively cite just a few provisions and fail to consider the legislation as a whole. The assertion that short-term gimmickry covers up long-term deficit increases is flatly contradicted by CBO’s assessment that the legislation will reduce the deficit in its second ten years and in subsequent decades.

Claim: The legislation uses revenues from Social Security and premiums from long-term care insurance to offset the cost of health reform.

Fact: Health reform reduces the deficit even without counting long-term care insurance premiums and additional Social Security payroll tax collections.

CBO and the Joint Committee on Taxation have concluded that the health reform legislation will reduce employer spending on health insurance, in part because the new excise tax on high-cost insurance plans will lead employers to shift some employee compensation from health insurance to cash wages. Workers will pay Social Security payroll contributions and income taxes on the additional wages.

The legislation also establishes a new, voluntary program of long-term care insurance, called the CLASS Act. Benefit payments from CLASS will be fully financed by premiums that beneficiaries pay and interest earnings. In its early years, as the program starts up, premium collections will substantially exceed benefit payments.

Congressional leaders crafted the health reform bill so that it would be fully paid for without relying on these additional Social Security payroll contributions or the CLASS Act premiums. The CBO estimate clearly shows that if one excludes the net revenues of $29 billion from Social Security contributions and $70 billion from CLASS Act premiums, health reform still reduces the deficit by $44 billion over the first ten years.

Categories: Social Security · budget / tax policy · health care
Tagged: , , , , , , ,

The Health Reform Bill Cuts Medicare. Not.

March 24, 2010 · 5 Comments

As you may have read or heard, the health reform legislation cuts Medicare by about $500 billion. What this means, exactly, is up for grabs. The conservative opposition to the cuts is clearly a political ploy, since they’ve been trying to destroy Medicare for decades. But even I get my hackles up when I hear that more than half of the health care reform’s $940 billion cost is being covered by cuts to Medicare, while the drug and insurance companies get a free ride (or in fact, a boost).

A closer look, however, reveals that a lot of the cuts are to private Medicare Advantage plans, which I’ve long opposed as a mammoth rip-off. The legislation’s supporters swear it won’t compromise benefits, and the Medicare Rights Center (which I trust a lot more than I do AARP) is all for it. 

I’ll be writing more about this in the future–but for now, Factcheck.org, the Annenberg Public Policy Center’s project that aims to straighten out some of the more egregious misconceptions about public policy, lays out the basics:

Whether these are “cuts” or much-needed “savings” depends on the political expedience of the moment, it seems. When Republican Sen. John McCain, then a presidential candidate, proposed similar reductions to pay for his health care plan, it was the Obama camp that attacked the Republican for cutting benefits. Whatever you want to call them, it’s a $500 billion reduction in the growth of future spending over 10 years, not a slashing of the current Medicare budget or benefits. It’s true that those who get their coverage through Medicare Advantage’s private plans (about 22 percent of Medicare enrollees) would see fewer add-on benefits; the bill aims to reduce the heftier payments made by the government to Medicare Advantage plans, compared with regular fee-for-service Medicare. The Democrats’ bill also boosts certain benefits: It makes preventive care free and closes the “doughnut hole,” a current gap in prescription drug coverage for seniors.

Categories: Congress · Medicare · Obama Administration · drug industry · health care · health insurance industry
Tagged: , ,

Health Care Reform: The Older You are, the More You Pay

March 23, 2010 · 4 Comments

Another thing about the health care reform act: Insurers, including those in the exchanges, can charge higher premiums to older people. The legislation permits “age-rating,” which is terrible for people ages 50-65, who are too young for Medicare, but old enough to pay twice as much as younger people. But of course, AHIP’s Karen Ignazio is complaining that the ratio limit is too low–they want to be able to pay 5 times as much. Why? because, they say, the old geezers drive up costs for young people. Poor babies. Seems like the one thing the health insurance can’t stop doing is  promoting a phony generation war.

Age-rating has received little attention from the media, even from those criticizing the legislation. The exception is women’s groups, who today pointed out that the reform promotes both age-rating and gender rating (not to mention limiting payment for abortion). 

In a press release, NOW says:  

Fact: The bill permits age-rating, the practice of imposing higher premiums on older people. This practice has a disproportionate impact on women, whose incomes and savings are lower due to a lifetime of systematic wage discrimination.

Fact: The bill also permits gender-rating, the practice of charging women higher premiums simply because they are women. Some are under the mistaken impression that gender-rating has been prohibited, but that is only true in the individual and small-group markets. Larger group plans (more than 100 employees) sold through the exchanges will be permitted to discriminate against women — having an especially harmful impact in workplaces where women predominate.

We know why those gender- and age-rating provisions are in the bill: because insurers insisted on them, as they will generate billions of dollars in profits for the companies. Such discriminatory rating must be completely eliminated.

I also wrote about age rating on Unsilent Generation last year, when it was part of the so-called Baucus plan in the Senate. You can read that piece here.
Probably the best report on age rating came out last year from the Urban Institute last October. While it’s now out of date when it comes to the numbers, it provides a good understanding of what’s involved.

One of the central goals of comprehensive health care reform is to eliminate discrimination by health status in the sales and pricing of health insurance and reduce the financial burdens associated with poor health. Consequently, current proposals being considered by Congress would prohibit health insurers from setting premiums based explicitly on the health experience of enrollees. These proposals would promote sharing of health care risk by limiting, but not eliminating, the differences in premiums charged to individuals of different ages.

The age rating limits are quite different across the proposals under consideration. The Baucus proposal (as of September 16, 2009), for example, would allow age rating bands of 5:1 (i.e., the premiums charged the oldest adults could be no more than 5 times those charged younger adults), while the House Tri-Committee proposal and the Senate Health, Education, Labor, and Pension (HELP) Committee proposal would limit age rating bands to 2:1. The larger the variation permitted in premiums based upon age, the less broadly risk is shared, as health care expenditures tend to increase with age.2 The smaller the variation permitted, the greater is the extent to which younger individuals who purchase coverage will tend to cross-subsidize the health care expenses of older individuals.

Such differences in age rating bands will lead to significant differences in the distribution of health care burdens across individuals and families of different ages, particularly those enrolling in coverage independently through the proposed National Health Insurance Exchange (referred to here as “the exchange”). This analysis highlights these differences, providing insight into the trade-offs inherent in this policy choice. We compare the distributional consequences across individuals and families under a health care reform approach similar to that delineated in the House Tri-Committee proposal (H.R. 3200) using age rating of 5:1, 2:1, and 1:1 (i.e., pure community rating where all ages are charged the same premium).

Categories: Congressional Democrats · Obama Administration · age discrimination · generations / intergenerational issues · health care · health insurance industry
Tagged: , , ,

Big Pharma Wins Big in Health Care Reform

March 22, 2010 · 7 Comments

The Republicans look a sour lot this morning, but the pharmaceutical industry, which helps foot the campaign bills of a sizeable chunk of members of both parties, is delighted with the legislation, and with its Democratic friends in the White House and on the Hill.

Members of Congress in both parties generally have lined up behind the insurance and pharmaceutical industries from the get go. So it should come as no surprise that the Democrats, who long ago gave up any pretence of opposing corporate power, found a way to accomodate the pharmaceutical companies on the way to its tepid reform. To a large extent, the “debate” over health care was a show debate, an extended round of Washington smoke and mirrors. The administration early on cuts its deal with Big Pharma, and pretty much stuck to it throughout the process.

In fact, the Dems actually made the drugsters look good, celebrating the industry’s generous “concessions” and “discounts” while ensuring that no real threat to Big Pharma’s profits would make their way into the final bill.

The industry’s  main goal from the very beginning has been to fend off any government power to negotiate or seriously regulate drug prices–and this they did. 

Big Pharma’s second big win was to prevent any measure that would have opened the way for American consumers to buy less expensive drugs abroad, especially from Canada.

At the same time, the supposed give-backs by the drug industry are projected to more than pay for themselves. The much-lauded discounts on brand name drugs for seniors in the Medicare prescription drug program, for example, are good for Big Pharma because they discourage oldsters from switching to generics.

And more insured people simply mean more money coming into the coffers, for Big Pharma as well as for the insurance industry.

Confirmation of the industry analysis came early in the day from the stock market, where drug stocks initially remained level; there certainly was no rush to dump shares, which is what would be expected if the bill actually represented any threat to profits. And by 1 p, EST, CNN Money was reporting a rally in health care stocks.

“I was unable to find anything in there that would cause me to have anxiety if I were a shareholder in a pharmaceutical company,” Ira Loss, a senior health-care analyst at the research firm Washington Analysis, told Dow Jones. According  to the ticker story:

Billy Tauzin, who led the industry’s negotiations on health care with lawmakers, said overall drug makers fare well. “While we’re not totally happy,” Tauzin began, “we generally feel like it tracks with our principles.”

Sanofi-Aventis SA (SNY) Chief Executive Christopher Viehbacher said in an interview that the impact of the legislation will be neutral to slightly negative “but better for the industry than if healthcare reform didn’t pass.”

Tauzin, head of the Pharmaceutical Research and Manufacturers of America or PhRMA, and Viehbacher said getting protection for brand-name biologics is among the important provisions for the industry. Drug makers pushed hard to get 12 years of exclusive market protection while the White House and some lawmakers wanted to lower the protection to seven years.

Despite fees and rebates imposed by the legislation, “analysts say drug makers will end up recouping those costs through new customers: The bill would provide insurance coverage to an additional 32 million Americans.” The Dow Jones story continues:

Chalk up another good round for Pharma and Biotech in health care reform,” began a note to clients Friday from Concept Capital, a research firm.Ken Tsuboi, co-manager of the Allianz RCM Wellness Fund, sees the impact of bill, and its $90 billion in concessions over 10 years, as relatively minor in an industry that has annual global sales of about $750 billion, with about $300 billion in the U.S., and margins close to 30%.”I think that it is actually a pretty good deal for Pharma,” Tsuboi said.

The GOP, which purports to be the party of big business, ought to be applauding at least these portions of the health care reform–and perhaps when the cameras go away, some of them will quit bitching and count their blessings.  As for the obnoxious Tea Party gang, if they start threatening the real power in this country, which is vested in corporations, they may well find themselves whipped and isolated.

Categories: Congressional Democrats · Congressional Republicans · Medicare · Obama Administration · Wall Street / financial industry · corporations · drug industry · health care · health insurance industry · lobbying · right wing
Tagged: , , ,

Sam Smith’s Take on the Ins and Outs of the Health Care Legislation

March 20, 2010 · Leave a Comment

Sam Smith has put together an excellent rundown of the pluses and  minuses in the health care reform legislation on the Progressive Review. Here is the beginning bit:

The Obamites brag about the bill providing new health care for 32 million people. This is misleading on several grounds:

- Nine million of these, according to the CBO study, are presumed to be people moving to a another form of health care – i.e. from their employer based insurance (4 million) or presently non-group insured (5 million) moving to exchanges.

- Half of the improvement (16 million) would be due to improvements in Medicaid and CHIP. You don’t need a 2000 page bill to do that.

- Subtract the Medicaid and policy shifters from the calculation and you end up with only about seven million new people getting insurance. And this is not, for the most part, because the Democrats are providing it (although there will be tax credits to help some). A big reason will be a hidden tax known as the individual mandate. Thus Obama and the Democrats are claiming credit for giving people something when they are instead requiring them to do it with their own funds. This would be like claiming credit for increasing millions of people’s incomes by reinstituting the draft.

- In sum, about 16 million people are being substantially helped and about the same number are being manipulated into thinking they are getting more than they are.For example, private insurance costs can be expected to soar, but tax credits are unlikely to rise at the same rate.

Read the rest of his piece at http://prorev.com/2010/03/whats-really-in-healthcare-bill.html.

Categories: health care
Tagged: , ,

Big Pharma Jacks Up Drug Costs in Advance of Health Care Reform

March 19, 2010 · Leave a Comment

Well, whaddaya know! Just as Congress is winding up its big health care “reform”–which among other things promises to plug the “doughnut hole” coverage gap in Medicare’s prescription drug program–prices of drugs for the oldsters are reaching new heights.

It’s been clear for some time that Big Pharma has been jacking up drug prices in preparation for any new regulation that might come out of the health care reform. Last November, the New York Times was reporting that drug prices had already increased so much that they raised the nation’s total health care costs by some $10 billion.

New details on the rise in prices for the drugs most commonly used by elders come from a report by the Kaiser Foundation, which finds that “Between 2009 and 2010, monthly prices in the coverage gap increased by 5 percent or more for half of the top ten brand-name drugs.”

The study notes:

A unique feature of the Medicare Part D drug benefit is the coverage gap, or so-called “doughnut hole,” where Part D enrollees are required to pay 100 percent of total drug costs after their spending exceeds the initial coverage limit, before qualifying for catastrophic coverage. The coverage gap in the Part D standard benefit is $3,610 in 2010 and is projected to increase to $5,755 by 2018, under current law. the coverage gap are likely to have multiple chronic conditions and take either several medications or a smaller number of relatively expensive brand-name drugs. An estimated 3.4 million Part D enrollees (14 percent of all enrollees and 26 percent of those using prescription drugs and not eligible for the low-income subsidy) reached the coverage gap in 2007. 

For example, an older woman taking Actonel for osteoporosis, Aricept formemory loss, and the blood thinner Plavix would spend $448 per month in 2010 after she reached the gap (in roughly six months), and would remain in the gap for the rest of the year, assuming no changes in her drug regimen. Between 2009 and 2010, her total monthly out-of-pocket costs in the gap for these three drugs would have increased by 7 percent (from $417 to $448) – at a time when Part D premiums also increased and there was no increase in Social Security payments.

So let’s see: The cost of drugs is rising (with many brand name drugs not covered by Medicare drug plans–or covered with a co-pay of $50, $75, or more). Medicare Part D premiums are going up sharply, as well, since the insurance companies have to make sure they still get their share. And Social Security payments are remaining the same, with no cost of living increase.

It’s great that health care reform may close the doughnut hole–but at this rate, some old people won’t be able to afford their medication, gap or no gap. And let’s not forget that the government subsidizes Part D, so old folks are getting screwed as taxpayers, as well as “beneficiaries.”

Categories: Medicare · Social Security · drug industry · health care · health insurance industry
Tagged: , ,