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Column: We all want lower drug prices. Why is that so hard to accomplish?

David Lazarus
·5 mins read
Insulin makers are trying to appear sensitive to patients' needs after raising prices more than 500% since 2001.
President Trump's executive orders and a California bill on insulin prices highlight America's go-nowhere approach to healthcare reform. (Los Angeles Times)

More than a third of Americans say healthcare is the single most important issue going into November's election.

According to Gallup, 35% of U.S. adults say healthcare is extremely important to winning their vote — and that's based on a survey taken prior to the COVID-19 pandemic causing about 150,000 deaths and turning everyone's life upside-down.

Yet Democrats and Republicans continue to struggle, as has been the case for decades, for solutions to this country's shamefully, pathetically, inexcusably dysfunctional healthcare system, which prioritizes corporate profits ahead of patients' well-being.

Last week, President Trump signed a handful of executive orders that he said "will completely restructure the prescription drug market." They include allowing certain drugs to be imported from Canada and changing the way discounts are passed along to Medicare beneficiaries.

The pharmaceutical industry immediately rejected the orders. Trump was scheduled to meet Tuesday with senior industry executives, but that meeting appeared to fall apart Monday as drug companies circled their wagons and prepared for possible litigation.

Critics and healthcare experts say the executive orders merely rehash previous administration initiatives or are so vaguely worded as to be unenforceable. Most of the orders won't be finalized before the election.

Rob Smith, a healthcare analyst with Capital Alpha Partners, called the orders "a way to give the appearance of movement on Trump's pricing agenda without actually doing anything."

Sen. Ron Wyden, an Oregon Democrat, dismissed the measures as "more snake oil for Trump to sell on the campaign trail."

As with most of our urgent national issues — immigration, homelessness, the environment — it's up to the states to backfill Washington's uselessness with piecemeal measures, and that's no less true when it comes to healthcare.

Yet California is struggling to make a difference.

Case in point: A bill introduced by state Assemblyman Adrin Nazarian (D-North Hollywood) that would cap insulin co-pays at $50 for a typical 30-day supply and at no more than $100 a month.

The legislation, AB 2203, is stuck in the Senate Health Committee as lawmakers scramble to prioritize their goals in a session truncated by the pandemic. The Legislature has until the end of August to act on hundreds of bills.

Nazarian told me Monday that he was informed by the chairman of the Senate committee, Sen. Richard Pan (D-Sacramento), that instead of focusing on a single drug, the Legislature should be working on a more far-reaching bill addressing a wider range of illnesses.

"I support that," Nazarian said. "But why should we wait possibly years for a bill when we can pass this in a month?"

Noting that insulin prices have tripled in recent years, with diabetes disproportionately affecting the Black and Latino communities, he said it makes no sense to avoid acting as quickly as possible to protect financially vulnerable families.

"To me, it's a no-brainer," Nazarian said.

Shannan Velayas, a spokeswoman for Pan, responded that "because of COVID-19, we are unable to properly vet this bill for all of its potential issues."

As a person with Type 1 diabetes, I agree with Nazarian that insulin prices are out of control, particularly in light of the fact that this drug has been around for many years and diabetes is the country's seventh-leading cause of death.

But I also take Pan's point that we shouldn't be chipping away at drug prices individually. What's needed is a sweeping commitment to pharmaceutical fairness, and we're nowhere close to that.

The biggest obstacle to healthcare reform in this country isn't political; it's philosophical.

All other developed countries predicate their healthcare policies on a simple idea: Affordable, accessible healthcare isn't a privilege, it's a right.

For that reason, every one of our economic peers has adopted a variation of a single-payer insurance system that guarantees coverage for all and protects people from price gouging.

Americans take the opposite approach. We consider healthcare a privilege, not a right, and we allow healthcare providers to charge as much as they please.

About 30 million Americans have no health insurance — a jaw-dropping statistic for the wealthiest nation on the planet. Millions more are "underinsured," meaning their coverage is so skimpy they can still be wiped out financially by a serious illness.

Republicans and Democrats say they support the idea of universal coverage, by which every man, woman and child would have affordable health insurance. Until we acknowledge that healthcare is a right, however, we'll never get there.

Props to Trump for at least keeping this issue in the spotlight. He ran in 2016 on lowering drug prices and has been cautiously dipping his toes in the pool of healthcare reform ever since.

But all we've gotten to date are half-measures and political posturing.

If Trump were serious about reducing drug prices, he would seek to end a Republican ban on Medicare negotiating costs with drugmakers on behalf of its 60 million beneficiaries.

His executive orders don't do that. Instead, if enacted, they would use the lowest price paid by other developed countries for certain drugs administered in a doctor's office.

In other words, Medicare would only be able to lower some drug prices under Part B, which is medical coverage, rather than under Part D, which is the program's prescription-drug plan.

This could be beneficial for, say, cancer patients receiving expensive chemotherapy in a hospital. For millions of others who pick up drugs at the pharmacy, it would have no effect.

Republicans say they won't enact any changes that smack of price controls. Yet these same lawmakers also insist they firmly believe in the competitive power of free markets.

A free market is when the country's single largest purchaser of prescription drugs — Medicare — is able to exercise its economic clout in dealing with drugmakers. Until that happens, price controls are exactly what we have, except they favor corporations, not patients.

Nazarian calls his insulin price cap "the smallest morsel of a modicum we could do." Clearly California and the United States can do better.

But until we're ready to do what's best for the American people and create a healthcare system worthy of such a great nation, small morsels may be the best we can hope for.