President Donald Trump’s blueprint to reduce drug prices frames almost as many questions as answers, but it does shine light on a vexing and complicated problem. Meanwhile, Vermont passed a law to do something that’s not in the president’s plan: import cheaper prescription drugs from Canada. The state will need federal permission to do that, which is unlikely to be granted.
And Timothy Jost, emeritus professor of law at Washington and Lee University in Virginia, discusses the state of the Affordable Care Act and what might be in the health law’s immediate future.
This week’s panelists for KHN’s “What the Health?” are Julie Rovner of Kaiser Health News, Anna Edney of Bloomberg News, Joanne Kenen of Politico and Rebecca Adams of CQ Roll Call.
Among the takeaways from this week’s podcast:
It is not yet clear how many of the myriad proposals in Trump’s 44-page prescription drug price proposal will be implemented, but the plan does jump-start the discussion across a wide range of drug issues.
Although Trump walked back his promise to move Medicare toward negotiating drug prices, his drug proposal would move some drugs administered in physicians’ offices — currently paid under a formula — to be handled by the Part D prescription drug plans, for which insurance companies negotiate prices.
The drug price initiative is welcomed by Republican candidates who think it will be a potent defense against Democratic charges that GOP efforts on the Affordable Care Act are driving overall health care spending up.
With the increasing reports that in the not-too-distant future one or more justices will retire from the Supreme Court, abortion-rights activists are nervous about how a new court would view the issue and are working hard to avoid a big federal lawsuit that could overturn Roe v Wade.
Plus, for “extra credit,” the panelists recommend their favorite health stories of the week they think you should read, too.
Julie Rovner: Kaiser Health News’ “For The Babies Of The Opioid Crisis, The Best Care May Be Mom’s Recovery,” by Sarah Jane Tribble
Joanne Kenen: Science Magazine’s “Hoping to Head Off an Epidemic, Congo Turns to Experimental Ebola Vaccine,” by Jon Cohen
Rebecca Adams: Kaiser Health News’ “Under Trump Proposal, Lawful Immigrants Might Be Inclined To Shun Health Benefits,” by Christina Jewett and Melissa Bailey and Paula Andalo
Anna Edney: Vox.com’s “The Blockbuster Fight Over This Obscure Federal Program Explains America’s Drug Prices,” by Dylan Scott
To hear all our podcasts, click here.
And subscribe to What the Health? on iTunes, Stitcher or Google Play.
Every day, a school bus drops off as many as 45 children at a community eye clinic on Chicago’s South Side. Many of them are referred to the clinic after failing vision screenings at their public schools.
Clinicians and students from the Illinois College of Optometry give the children comprehensive eye exams, which feature refraction tests to determine a correct prescription for eyeglasses and dilation of their pupils to examine their eyes, including the optic nerve and retina.
No family pays out-of-pocket for the exam. The program bills insurance if the children have coverage, but about a third are uninsured. Operated in partnership with Chicago public schools, the program annually serves up to 7,000 children from birth through high school.
“Many of the kids we’re serving fall through the cracks,” said Dr. Sandra Block, a professor of optometry at the Illinois College of Optometry and medical director of the school-based vision clinics program. Many are low-income Hispanic and African-American children whose parents may not speak English or are immigrants who are not in the country legally.
Falling through the cracks is not an uncommon problem when it comes to vision care. According to a 2016 report from the National Academies of Sciences, Engineering and Medicine, as many as 16 million people in the United States have undiagnosed or uncorrected “refractive” errors that could be fixed with eyeglasses, contact lenses or surgery. And while insurance coverage for eye exams and corrective lenses clearly has improved, significant gaps remain.
The national academies’ report noted that impaired vision affects how people experience their world, including normal communication and social activities, independence and mobility. Not seeing clearly can hamper children’s academic achievement, social development and long-term health.
But when people must choose, vision care may lose out to more pressing medical concerns, said Block, who was on the committee that developed the report.
“Vision issues are not life-threatening,” she said. “People get through their day knowing they can’t see as well as they’d like.”
Insurance can make regular eye exams, glasses and treatment for medical problems such as cataracts more accessible and affordable. But comprehensive vision coverage is often achieved only through a patchwork of plans.
The Medicare program that provides coverage for millions of Americans age 65 and older doesn’t include routine eye exams, refraction testing or eyeglasses. Some tests are covered if you’re at high risk for a condition such as glaucoma, for example. And if you develop a vision-related medical condition such as cataracts, the program will cover your medical care.
But if you’re just a normal 70-year-old and you want to get your eyes examined, the program won’t cover it, said Dr. David Glasser, an ophthalmologist in Columbia, Md., who is a clinical spokesman for the American Academy of Ophthalmology. If you make an appointment because you’re experiencing troubling symptoms and get measured for eyeglasses while there, you’ll likely be charged anywhere from about $30 to $75, Glasser said.
There are a few exceptions. Medicare will pay for one pair of glasses or contact lenses following cataract surgery, for example. Some Medicare Advantage plans offer vision care.
Many commercial health insurance plans also exclude routine vision care from their coverage. Employers may offer workers a separate vision plan to fill in the gaps.
VSP Vision Care provides vision care plans to 60,000 employers and other clients, said Kate Renwick-Espinosa, the organization’s president. A typical plan provides coverage for a comprehensive eye exam once a year and an allowance toward standard eyeglasses or contact lenses, sometimes with a copayment. Also, individuals seeking plans make up a growing part of their business, she said.
Vision coverage for kids improved under the Affordable Care Act. The law requires most plans sold on the individual and small-group market to offer vision benefits for children younger than 19. That generally means that those plans cover a comprehensive eye exam, including refraction, every year, as well as a pair of glasses or contact lenses.
But since pediatric eye exams aren’t considered preventive care that must be covered without charging people anything out-of-pocket under the ACA, they’re subject to copays and the deductible.
Medicaid programs for low-income people also typically cover vision benefits for children and sometimes for adults as well, said Dr. Christopher Quinn, president of the American Optometric Association, a professional group.
But coverage alone isn’t enough. To bring down the number of people with undiagnosed or uncorrected vision, education is key to helping people understand the importance of eye health in maintaining good vision. Just as important, it can also reduce the impact of chronic conditions such as diabetes, the national academies’ report found.
“All health care providers need to at least ask vision questions when providing primary care,” said Block.
KHN’s coverage of children’s health care issues is supported in part by the Heising-Simons Foundation.
President Donald Trump, armed with the expertise of staff seasoned in the ways of the drug industry, unveiled his blueprint to address sky-high drug prices Friday afternoon, promising that increasing industry competition will help Americans save at the pharmacy counter.
“Under this administration, we are putting American patients first,” Trump said with Secretary of Health and Human Services Alex Azar by his side. Azar, he said, had a mission to “to bring soaring drug prices down to Earth.”
Many of the proposals Trump’s team can accomplish administratively — and some are already in motion — but for others, Trump said, he plans to work with Congress.
The administration’s blueprint proposes 50 actions to reduce what Americans pay for drugs, including giving Medicare more power to negotiate drug prices, Azar said.
Azar said he wants to make drug prices more transparent, as well. For example, he said the Food and Drug Administration should require pharmaceutical companies to disclose drugs’ list prices in their direct-to-consumer television ads.
“It’s material and relevant to know if it’s a $50,000 drug or a $100 drug,” Azar said.
Dr. Jeremy Greene, a professor and health policy expert at Johns Hopkins Medicine, said he was puzzled by how much control the agency would have over requiring drug prices as part of advertising.
“The FDA has had nothing to do with price, especially in advertising,” Greene said. “There have been prominent court cases over whether pharmacies can or cannot advertise based on drug prices.”
Regardless, Trump called the plan “the most sweeping action in history to lower the price of prescription drugs to the American people.”
“We will have tougher negotiations, more competition and much lower prices at the pharmacy counters,” Trump said. “And it will start to take effect very soon.”
On a separate note, Trump told the audience that “right-to-try is happening,” a nod to congressional efforts to expand access to experimental medications for people with life-threatening conditions.
Trump’s proposals target reducing the out-of-pocket costs for older Americans enrolled in Medicare — but experts say that amounts to more show than substance.
“There’s a difference between reducing the pain people feel associated with out-of-pocket costs at the pharmacy counter and reducing the actual national spend on prescription drugs,” said Allan Coukell, senior director for health programs at the nonpartisan Pew Charitable Trusts.
While 80 percent of Americans say the cost of drugs is unreasonable, 1 in 4 people report having difficulty paying for drugs, according to Kaiser Family Foundation polling. And the government is paying more, too. Medicare’s drug spending grew nearly 90 percent from 2006 to 2015, with an annual average growth rate of 7.6 percent, according to Pew.
During the campaign and his presidency, Trump has used strong language against the pharmaceutical industry, famously saying the manufacturers are “getting away with murder.” Late Thursday, senior administration officials told reporters on a call that the plan will reduce the price pharmaceutical companies set for drugs.
But when asked about whether Medicare will negotiate drugs — as Democrats have called for and the president has talked about — administration officials said that lever would not be pulled.
Instead, Trump’s blueprint calls for measures such as offering free generics to low-income seniors, passing on to consumers more of the negotiated savings that insurers win, and making sure Medicare enrollees don’t spiral into the so-called catastrophic phase of coverage they hit when they pay thousands of dollars a year for drugs.
Leigh Purvis, director of health services research at AARP Public Policy Institute, said the president’s proposals fail to ultimately address that spending. AARP has long called for Medicare to have the ability to negotiate prices.
“Anything that doesn’t address the list price really is just kind of squeezing the balloon in this world,” Purvis said.
For Medicare patients, though, limiting what they pay out-of-pocket could be especially helpful to those taking cancer drugs or other expensive therapies, said Stacie Dusetzina, an associate professor of health policy at Vanderbilt University School of Medicine.
Today, patients who pay $5,000 out-of-pocket for prescriptions enter the “catastrophic” category of Medicare coverage, and are charged just 5 percent of their drug costs. But given the astronomical cost of cancer drugs, that can leave patients paying $1,000 a month or more, Dusetzina said.
Medicare patients with the deadly cancer multiple myeloma can spend $14,000 a year out-of-pocket for the drug Revlimid, which costs about $20,000 a month, Dusetzina said.
Trump also accused other developed countries of “freeloading” by enjoying the fruits of American innovation — including drugs developed with taxpayer money or by U.S. companies — without paying a fair price. Because national health systems in other countries have authority to negotiate drug costs — and refuse to cover some drugs entirely — their citizens often pay a fraction of the prices charged in the United States.
“In some cases, medicines that cost a few dollars in foreign countries cost hundreds of dollars for the same pill” in the United States, Trump said. “It’s unfair, it’s ridiculous and it’s not going to happen any longer. It’s time to end the global freeloading once and for all.”
A spokesman for Doctors Without Borders said Trump has it backward. Instead of raising drug prices abroad, costs need to come down everywhere, said Leonardo Palumbo, U.S. advocacy adviser for the group’s access campaign.
“Other countries aren’t ‘free-riding,’ and lifesaving medicines aren’t more expensive here because they cost less elsewhere,” Palumbo said.
Today, Medicare has limited power to negotiate drug prices, partly because many of the most expensive treatments — such as those for cancer patients — are in a protected class that must be covered, Dusetzina said.
To really negotiate better prices, Medicare would need the freedom to reject some drugs completely, Dusetzina added.
But excluding certain expensive drugs from the Medicare program could leave patients in a difficult position, said Chris Hansen, president of the American Cancer Society’s Cancer Action Network. Patients who want an expensive drug would either have to skip it or pay for it themselves, he said.
Azar said Medicare could pressure drug companies to keep prices down in other ways.
“In our drug discount program, if you have a drug in a protected class, it’s almost impossible for drug plans to negotiate and get a discount,” Azar said. “What if we said you only get to be in a protected class if you haven’t raised your price in 18 months?”
Some policy experts, though, said Trump’s proposals are mostly old ideas.
“I don’t think anyone is talking seriously about having Medicare negotiate with drugmakers,” said Tom Bulleit, head of the health care practice at the D.C. office of Ropes & Gray.
Rep. Peter Welch (D-Vt.), who along with Rep. Elijah Cummings (D-Md.) met with Trump at the White House a year ago to propose changes on drug prices, said, “If you listen carefully, you can almost hear the champagne popping in the corporate boardrooms of drug companies across the country.”
David Maris, a pharmaceutical industry analyst for Wells Fargo investors, released a note earlier this month pointing out that the increased social and economic tension on the drug industry is building.
“My guess is this is just the beginning,” Maris said.
Trump’s plan includes tackling the rising costs of drugs in Medicare’s Part B program, which pays for drugs delivered in doctor’s offices or hospital outpatient setting — a challenge previous administrations have failed to tackle.
While the details are still vague, Trump has called for the prices paid for certain drugs under Part B — these could include expensive drugs for cancer chemotherapy and rheumatoid arthritis — to be negotiated using the same tactics insurers and pharmacy benefit managers use under Medicare Part D, which is the program that seniors use for their retail prescription drugs.
Azar said the administration plans to release a request for information to gather input on changes to the program.
The Pharmaceutical Research and Manufacturers of America released a statement Friday saying it was looking forward to working with the administration and warning: “While some of these proposals could help make medicines more affordable for patients, others would disrupt coverage and limit patients’ access to innovative treatments.”
KHN’s coverage of prescription drug development, costs and pricing is supported by the Laura and John Arnold Foundation.
Tucked into the federal budget law Congress passed in February was a provision that significantly expands the use of telemedicine — long a hyped health care reform, and now poised to go mainstream within five to 10 years.
“There’s much broader recognition of the benefits,” said Mei Wa Kwong, executive director of the Center for Connected Health Policy, a research group that promotes telemedicine in Sacramento, Calif. “The law is the latest to make telemedicine more accessible. But we still have a ways to go before most consumers are aware of the option.”
The new law allows Medicare to cover telemedicine services for people who have had a stroke and those who get kidney dialysis, either at home or at a dialysis facility. It also permits Medicare Advantage Plans — private plans that enroll a third of Medicare beneficiaries — to offer telemedicine as a covered benefit.
Separately, as of Jan. 1, Medicare began allowing doctors to bill the government for monitoring certain patients remotely using telemedicine tools — for example, tracking heartbeat and rhythm, blood pressure and blood glucose levels.
Telemedicine, also referred to as telehealth, uses computers — and their display monitors, software and capacity for data analysis — to deliver virtual health services.
In the easiest-to-understand example, a patient is in one location and has an e-visit with the doctor in another location. They are connected via a secure video link. Proponents say that more sophisticated monitoring is on the horizon and that virtual encounters will become more commonplace.
As acceptance and adoption of telemedicine expands, so does coverage. All private health plans, Medicare, state Medicaid programs and the Department of Veterans Affairs now cover some e-visits — albeit with restrictions. More health centers and hospitals are launching virtual health centers. And websites offering virtual “doctor-on-demand” services are proliferating.
Concerns exist, however. Doctors worry that they may get paid less if insurance reimbursement is lower for e-visits than in-person appointments, or that e-visits could undermine the doctor-patient relationship by reducing valuable face time. They point out that for some ailments, like strep throat, it’s best if doctors or other health providers see the patient.
Health economists, meanwhile, are concerned that e-visits could add to costs rather than constrain them — if, for example, doctors and patients abuse e-visits by scheduling them unnecessarily because they are quick and easy. Also, insurers may be motivated to push doctors to do more e-visits instead of in-person visits to save money. And for some people, access to proper equipment or internet access can be difficult.
“The potential for abuse is there,” says Dr. Robert Berenson, a Medicare expert at the Urban Institute. “We will need to prevent gaming and misuse of the system. But, generally, helping people avoid unnecessary doctor’s office and hospital visits is a good thing, if we do it right.”
Here’s a briefing on telemedicine basics:
Q: Are e-visits available from most hospitals and doctors?
Not yet. But access is increasing. Ask your doctor, clinic or hospital.
In some cities, medical centers are setting up telehealth “hubs” to handle patients. For example, Penn Medicine in Philadelphia launched its Connected Care center in February with 50 full-time employees, 24/7 access to care and a program to treat chronically ill patients at home. Some of the center’s e-visit services are open only to Penn Medicine employees, but other services are available to anyone, with a focus on residents of Pennsylvania, New Jersey, Delaware and Maryland, said Bill Hanson, vice president and chief medical information officer at Penn Medicine.
Similarly, Mercy Virtual in Chesterfield, Mo., a St. Louis suburb, serves patients throughout the Midwest, and those treated at Mercy Health’s network of 44 hospitals in five states. Launched in 2015, Mercy Virtual provided care to 750,000 people in 2017 with a team of 700 doctors, nurses and support staff.
Other medical centers with virtual health programs include Avera Health based in South Dakota; Cleveland Clinic in Ohio; Dignity Health in San Francisco; Intermountain Healthcare in Utah; and Kaiser Permanente, a managed-care health system in California and elsewhere.
Kaiser Permanente reported last year that 21 percent of its 110 million patient interactions in 2015 were e-visits. Officials there predict that by 2020 e-visits will exceed in-person visits. (Kaiser Permanente is not affiliated with Kaiser Health News, which is an editorially independent program of the Kaiser Family Foundation.)
Q: What restrictions do health plans, Medicare and Medicaid put on e-visits?
Health plan coverage varies, but most private insurers cover e-visits, and 34 states and the District of Columbia require that they do. A few states still require that a patient relationship be established with an in-person visit before the provider can bill for an e-visit. Check with your insurer about its policies.
Medicare’s coverage of e-visits is more restrictive. First, e-visits must take the place of an in-person visit. Second, with exceptions allowed under February’s budget law, Medicare largely restricts e-visits to those that occur in rural areas that have a shortage of doctors and/or hospitals. And third, most e-visits can’t occur when the patient is at home. They can be done from a variety of other locations, such as a rural health clinic, a dialysis center or skilled nursing facility. A bill in Congress would loosen that restriction.
In contrast, almost all state Medicaid programs cover e-visits in the home. But restrictions still apply. For example, only 22 states cover remote patient monitoring for Medicaid enrollees.
The Telehealth Resource Centers, a federally funded organization promoting telemedicine and providing consumer information, has detailed explanations of e-visit restrictions and limitations.
Q: Do I need special computer equipment?
No. E-visits and other forms of telemedicine are done over commonly available computers, laptops, tablets and smartphones — and are typically encrypted to protect privacy. Specialized equipment is usually needed for remote monitoring, such as blood pressure or heart rate. One vexing barrier: broadband availability in rural areas. Also, millions of low-income and older Americans still lack Wi-Fi in their homes.
Q: What services can I get through telemedicine?
Most e-visits are for primary care or follow-up services, such as assessing symptoms or checking on people who have had a medical procedure. But a growing number — no one keeps national statistics — cater to people with chronic conditions who are being monitored at home, said Kwong.
Dermatology e-visits are becoming especially common. You can send a close-up photo of a skin rash, mole or other problem for an immediate assessment. Psychotherapy by e-visit is also expanding.
Sometimes an e-visit may provide an initial medical assessment for an injury, wound or illness that is clearly not life-threatening. Some cities are testing ambulance services that use telemedicine to triage whether people need a trip to the hospital.
Q: Will I save money if I do an e-visit instead of going into the doctor’s office?
E-visits are generally less expensive than a trip to the doctor, but you may not see the difference if your insurance covers both with only a small copay or no copay. If you have a large deductible, however, an e-visit may mean you pay less out-of-pocket for that encounter.
Some states require insurers to make equal reimbursements for in-office and telemedicine consultations on simple matters.
Q: Are there downsides or risks with telemedicine and e-visits?
There’s no evidence so far that your risk of being diagnosed wrongly or treated inappropriately is any greater with an e-visit compared to an in-person visit.
This week, I answered a grab bag of questions about drug copay coupons and primary care coverage on the health insurance marketplace.
Q: My doctor wants me to take Repatha for my high cholesterol, but my Medicare drug plan copayment for it is $618 a month. Why can’t I use a $5 drug copay coupon from the manufacturer? If I had commercial insurance, I could. I’m on a fixed income. How is this fair?
The explanation may offer you little comfort. Under the federal anti-kickback law, it’s illegal for drug manufacturers to offer people any type of payment that might persuade them to purchase something that federal health care programs like Medicare and Medicaid might pay for. The coupons can lead to unnecessary Medicare spending by inducing beneficiaries to choose drugs that are expensive.
“The law was intended to prevent fraud, but in this case it also has the effect of prohibiting Part D enrollees from using manufacturer copay coupons … because using the coupon would be steering Medicare’s business toward a particular entity,” said Juliette Cubanski, associate director of the Program on Medicare Policy at the Kaiser Family Foundation. (Kaiser Health News is an editorially independent program of the foundation.)
The coupons typically offer patients with commercial insurance a break on their copayment for brand-name drugs, often reducing their out-of-pocket costs to what they would pay for inexpensive generic drugs. The coupons help make expensive specialty drugs more affordable for patients. They can also increase demand for the drugmaker’s products. If patients choose to use the coupons to buy a higher-cost drug over a generic, the insurer’s cost is likely to be more than what it would otherwise pay.
In addition, consumers should note that the copay cards often have annual maximums that leave patients on the hook for the entire copayment after a certain number of months, said Dr. Joseph Ross, associate professor of medicine and public health at Yale University who has studied copay coupons.
The coupons may discourage patients from considering appropriate lower-cost alternatives, including generics, said Leslie Fried, a senior director at the National Council on Aging.
According to a 2013 analysis co-authored by Ross and published in the New England Journal of Medicine, 62 percent of 374 drug coupons were for brand-name drugs for which there were lower-cost alternatives available.
Q: Last year, my marketplace plan covered five primary care visits at no charge before I paid down my $2,200 deductible. This year, it doesn’t cover any appointments before the deductible, and I had to pay $80 out-of-pocket when I went to the doctor. Is that typical now? It makes me think twice about going.
Under the Affordable Care Act, marketplace plans are required to cover many preventive services, including an annual checkup, without charging consumers anything out-of-pocket. Beyond that, many marketplace plans cover services such as some primary care visits or generic drugs before you reach your deductible.
The likelihood of having a plan that offers some cost sharing for primary care before you reach your deductible (rather than requiring you to pay 100 percent of the cost until you hit that amount) varies significantly depending on whether you’re in a bronze, silver or gold plan, according to a recent analysis by the Robert Wood Johnson Foundation.
In 2018, 77 percent of silver-level plans offered some cost sharing for primary care visits before enrollees had paid off their typical deductible of $3,800, the analysis found. In most cases, that means people owe a copayment or coinsurance charge for each visit until they reach their deductible. A small number of plans offered a limited number of no-cost or low-cost visits first, and then people using more services either had to pay the full charge for each visit or owed cost sharing until the deductible was met.
Bronze plans were much stingier in what they offered for primary care before people reached their deductible, which was $6,400 or higher in half of plans. Only 38 percent of bronze plans offered any primary care coverage before the deductible, and generally patients still had to pay a copayment or coinsurace. A smaller percentage of bronze plans offered limited visits at no cost or low cost before the deductible.
The share of people who chose bronze plans grew from 23 percent in 2017 to 29 percent this year, said Katherine Hempstead, a senior policy adviser at the Robert Wood Johnson Foundation. While premiums are typically significantly lower in bronze plans than other “metal”-level plans, it can be worthwhile to check out how plans handle primary care services before the deductible, she said.
Please visit khn.org/columnists to send comments or ideas for future topics for the Insuring Your Health column.
It was 2015 when Martin Shkreli, then CEO of Turing Pharmaceuticals and the notorious “pharma bro,” jacked up the cost of the lifesaving drug Daraprim by 5,000 percent. Overnight, its price tag skyrocketed from $13.50 a pill to $750.
The move drew criticism from all corners. Congress hauled Shkreli in for questioning on television. Media outlets shamed the practice. The Pharmaceutical Research and Manufacturers of America (PhRMA), the powerful trade group for branded drugs, distanced itself, saying Turing “does not represent the values of @PhRMA” and kicked off a campaign it described as “more lab coat, less hoodie.”
Shkreli, 35, is now serving a seven-year prison term for securities fraud (unrelated to Daraprim). Turing has renamed itself Vyera Pharmaceuticals.
But Daraprim, which costs pennies to make and is used to treat the parasitic infection toxoplasmosis — which is rare in the United States — still retails for more than $750 per pill, according to drug website GoodRx.com. Vyera did not respond to multiple requests for comment.
The continued high price of the drug is a cautionary tale to those who hope that public shaming of a few “bad actors” can curb escalating drug prices, because the problem is rooted in the market’s underlying financial incentives.
Drug prices are “easy to raise and harder to lower, particularly if there’s no competition,” said Nicholson Price, an assistant professor at the University of Michigan Law School. “The mystery isn’t, ‘Why don’t drug prices go down?’ It’s more, ‘Why don’t they go up more?’”
That’s especially the case with a product like Daraprim, which benefits a relatively small group of people — about 2,000 Americans per year. That means less profit incentive for other companies to develop a competitor that could drive down prices.
Joey Mattingly, an assistant professor at the University of Maryland School of Pharmacy, uses Daraprim as a case study in a university course he teaches on pharmaceutical business strategy, highlighting how the industry functions under current incentives.
“The market sort of sets it up where, if you need it, you have to pay for it,” he said. “A for-profit entity is going to raise the price.”
Branded drugs like Daraprim are more likely to be priced high without a clear justification, noted David Howard, a health economist and professor at Emory University.
Daraprim was first approved by the Food and Drug Administration more than 50 years ago, and the patent has long since expired for both the drug and its active ingredient. But there’s no generic equivalent in the United States.
Even with generic-drug competition, costs don’t always drop. In 2015 alone, 300 generic drugs — off-patent medications, which are typically cheap to make — saw price increases of more than 100 percent, according to a 2016 Government Accountability Office report.
“We don’t have a good model for pricing pharmaceuticals in this country and, as a result, we keep spending a lot more money,” Price said. “We avoid thinking about it, or avoid dealing with it, and as a result things get more problematic.”
As prices climb, Vyera has followed what has become a familiar pharmaceutical playbook to shift attention and costs, launching what it calls the Daraprim Direct program.
Commercially insured patients can get a company-sponsored coupon that guarantees they’ll pay no more than $10 out-of-pocket. Uninsured patients at 500 percent or less of the federal poverty level — about $82,300 for a family of two — won’t pay anything.
People with Medicare Part D coverage can apply for copay assistance from an “independent charitable foundation” to which Vyera has donated money. This option is listed on the Daraprim Direct website. Technically, Medicare beneficiaries cannot use company coupons, but many drug companies skirt that regulation by sending assistance through a separate intermediary — such as an independent charity. It’s common enough that the practice has recently come under federal scrutiny.
Critics are quick to point out that such programs — often deployed for high-priced drugs — may enable patient access but do nothing to address overall expense. Private insurers, Medicare or Medicaid must pay the tab, whether through increased premiums or strained public health budgets.
On average, Medicaid programs in 2017 paid $35,556.48 per Daraprim prescription, according to a Kaiser Health News analysis of federal data covering that year’s first three quarters.
That figure doesn’t account for any rebates state Medicaid programs likely receive from Vyera, which is undisclosed proprietary information. In Massachusetts, those deals mean the state’s net costs for Daraprim have remained largely unchanged since 2014, though the price tag is 75 times what it was, said a spokeswoman for the agency’s Executive Office of Health and Human Services.
But states have variable negotiating leverage and skills in pressing for discounts. And paying for high-cost drugs — especially those without a competitor — remains a serious challenge, she said.
Generally, Medicaid likely pays hundreds of dollars per Daraprim pill, said Matt Salo, executive director of the National Association of Medicaid Directors. A standard starting dose of two to three pills per day lasts one to three weeks. And that’s likely to generate costs much higher than they were before Shkreli started selling Daraprim.
KHN data correspondent Sydney Lupkin contributed to this report.
Note: To determine what Medicaid paid for Daraprim, Kaiser Health News used data made public by the Centers for Medicare & Medicaid Services. This figure represents a weighted average of Medicaid payments per prescription, across various strengths, package sizes, routes and labels. It does not include drug versions (represented by National Drug Codes) with fewer than 11 prescription fills per quarter.
KHN’s coverage of prescription drug development, costs and pricing is supported by the Laura and John Arnold Foundation.
Keep an eye on your mailbox—Medicare is sending new cards with new Medicare numbers to people with Medicare. Mailing has started in certain states and will continue over the next few months nationwide. Your new Medicare card will include a new number unique to you, instead of your Social Security Number. This will help to protect you against identity fraud.
If you want to know when you’ll get your new card, visit Medicare.gov/NewCard and sign up to get email alerts from Medicare. We’ll send you an email when cards start mailing in your state, and we’ll also email you about other important Medicare topics.
You can also sign in to your MyMedicare.gov account and see when Medicare mailed your new card. If you don’t have a MyMedicare.gov account yet, visit MyMedicare.gov to create one. Once your new card has mailed, you can sign in anytime to see your new Medicare Number or print a copy of your card.
Remember that mailing takes time, so you might get your card at a different time than friends or neighbors in your area.
Once you get your new Medicare card:
Destroy your old Medicare card. Make sure you destroy your old card so no one can get your personal information.
Start using your new Medicare card right away! Your doctors, other health care providers and facilities know that it’s coming, so carry it with you when you need care. Your Medicare coverage and benefits will stay the same.
Keep your other plan cards. If you’re in a Medicare Advantage Plan (like an HMO or PPO) or a Medicare Drug Plan, keep using that Plan ID card whenever you need care or prescriptions. However, you should carry your new Medicare card too — you may be asked to show it.
Protect your Medicare Number just like your credit cards. Only give your new Medicare number to doctors, pharmacists, other health care providers, your insurer, or people you trust to work with Medicare on your behalf.
About 1 in 3 U.S. adults have high blood pressure—and you could be one of them. If you haven’t checked your blood pressure lately, now’s the time to take a quick and easy test. High blood pressure usually has no signs or symptoms, but it can lead to a higher risk of heart disease, stroke, and kidney failure.
It’s important for you to know your blood pressure numbers, even when you’re feeling fine. Checking your blood pressure is easy because it’s covered in your “Welcome to Medicare” preventive visit and yearly “wellness” visits at no cost to you.
If you have high blood pressure, you can help control it with lifestyle changes and medicine. You may be at risk for high blood pressure if you:
Eat salty foods
Don’t exercise enough
Drink more than a moderate amount of alcohol
Have a family history of high blood pressure
May is National High Blood Pressure Education Month. Find out more about how to fight high blood pressure and get checked today!
Brittle bones could shatter your life. Every year, more Americans are diagnosed with osteoporosis—a disease that causes bones to weaken and become more likely to break. You may not know that you have this “silent” disease until your bones are so weak that a sudden strain, bump, or fall causes your wrist to break or your hip to fracture.
Medicare can help you prevent or detect osteoporosis at an early stage, when treatment works best. Talk to your doctor about getting a bone mass measurement. If you’re at risk, Medicare covers this test once every 24 months (more often if medically necessary) when your doctor or other qualified provider orders it.
May is National Osteoporosis Awareness and Prevention Month. Learn more about your risk for osteoporosis and how to prevent and treat it at the National Osteoporosis Foundation. Watch our short video to learn more about how Medicare can help you protect your bones.
You can never be too old to improve your physical, mental, and emotional wellbeing. May is Older Americans Month, and it’s the perfect time to celebrate the many ways in which older adults can make a big difference. When we come together to celebrate this year’s theme of “Engage at Every Age,” people of all ages can participate in activities that bring our communities together to learn, socialize, and celebrate!
How can you get involved? Start by striving for personal health and wellness. The best way to stay healthy is to live a healthy lifestyle, and we’re here to help! Medicare covers these services to help you get healthier and prevent disease:
Counseling to stop smoking and tobacco use
Alcohol misuse counseling
Obesity screenings and counseling
Call your doctor today to set up a yearly “Wellness” visit to see if any of these services are right for you. Your doctor can also give you personalized wellness tips. Taking care of your physical and mental health will help give you energy to engage in other areas of your life.
In addition to getting and staying healthy, there are lots of activities you can do to improve your wellbeing and wellbeing of others. Here are a few ideas:
Talk to youth in your community who can benefit from hearing about your life experience and wisdom.
Invite members of your community to an event, like a meal or special program.
Plan a volunteering event, like gardening in your neighborhood or collecting food for those in need.
Get more great ideas on how to get involved in Older Americans Month and more information on this year’s theme of Engage at Every Age. Be sure to take a selfie (or groupie) and post the photo on social media with the hashtag #OAM18! Visit oam.acl.gov to learn more.