The 340B program continues to grow outside of its original purpose of helping the poor and uninsured — this is true, despite the promise that ObamaCare would vastly reduce the numbers of uninsured (and underinsured). Reforming the program will be a major defeat for Washington’s political class. Crony corporatists and their lobbyists have abused 340B to make themselves wealthier. Wealth creation is good, but not when a privileged few leverage government at the expense of patients and taxpayers.
We hear a lot about “draining the swamp,” but we don’t see a lot of action. With 340B reform, our elected officials have an opportunity to put patients over profits. Let’s hope they have the courage to do what’s right and necessary.
Read more about how the Trump Administration wants to reform 340B here: The Trump Administration is Right to Reform 340B.
Counterfeit Medicine RealClearHealth, 4/06/2017
No patient should have to worry that their state legislators will purposely limit their access to necessary medications. However, this is the precise scenario playing out in Annapolis, Maryland this week. Lawmakers – perhaps with good intentions – are moving a bill through the State House that is reckless public policy and that will threaten the lives and healthcare for all Marylanders.
The bill – H.B. 631 – allows the government to impose costs and regulatory burdens whenever bureaucrats believe that pricing of a medicine is “not justified.” However, the legislation, now being considered in the state Senate, sets no objective standard or legal threshold by which a judge or a healthcare provider can know what “not justified” means.
This legislation dangerously expands the power of the state’s Attorney General to interfere in the marketplace in such a way as to threaten competition. H.B. 631 will do nothing to offer relief to patients – it won’t lower prices. On the contrary, this bill will drive generic drug companies out of Maryland. By boosting the Attorney General’s power to “investigate” drug prices, politicians in Annapolis are advancing a course of action that will have the unintended consequence of reducing competition and, therefore, limiting patient access to medicines and medical therapies.
Elected officials “doing something” about the high cost of healthcare seems like good politics, but this “doing something” is bad medicine for patients. Marylanders deserve better than counterfeit reform.
The public debate over the cost of medicine isn’t new. Nor is political grandstanding on the issue. With H.B. 631, Maryland lawmakers from both political parties – the House of Delegates voted overwhelmingly, 137-4, to pass this terrible, horrible, no good, very bad bill – have chosen politics over policy.
Maryland lawmakers craving the momentary praise from the media and activists are putting their constituents’ health at risk. Their attempt at bureaucratic price manipulation will hurt all patients, but such political meddling will be devastating for Maryland’s sickest and poorest patients.
This legislation will do nothing to lower the cost of prescription medicines. It will undoubtedly have the exact opposite effect. If fewer affordable generic medicines are available in Maryland, patients suffer and healthcare costs will skyrocket.
The competitive marketplace of generic medicines substantially drives down drug prices for patients. Generic medicines saved Maryland $3.7 billion in 2015. Nationwide these medicines are 89% of prescriptions dispensed, but only 27% of total drug costs resulting in $227 billion in total savings in 2015. The overall price of generics fell over 8% in 2016, and prices are down over 70% since 2008.
Drug companies make easy targets, and healthcare policy is complicated. H.B. 631 is a short-sighted, political fix that will undermine competitive pricing and threaten patient care. It will inevitably increase drug prices and give Maryland the ignoble distinction of being first in the nation to deliberately push generics out of the marketplace.
The politics of supporting H.B. 631 is intuitively appealing; however, its promise of controlling drug prices is dangerously dishonest. When it predictably fails—and it increases the cost of medicine—will the politicians take responsibility? Or, will they look for another easy target to blame?
Better value and lower prices for medicines can be achieved without compromising patient access. But instead of exercising greater control over the marketplace, true reformers should focus on innovation and competition.
Here’s what to expect if H.B. 631 becomes law: less competition in the generic drug market which will lead to higher prices, limited access, and less choice. Patients won’t be able to obtain the life-saving medications they need.
Jerry Rogers is vice president at the Institute for Liberty and the founder of Capitol Allies. Andrew Langer is president of the Institute for Liberty and a principal at Capitol Allies. Both host a weekly podcast, the LangerCast, on the RELM Network.
In 2014, then-Governor John Kitzhaber, Oregon’s longest serving governor and full-on progressive Democrat—was in a high stakes reelection campaign. The ambitious Democrat needed to weather a storm of controversy around his campaign (he would win reelection with less than 50 percent of the vote in deep blue Oregon), and conceal the complete failings of his administration’s ObamaCare state-based health exchange Cover Oregon.
Kitzhaber hoped that his state’s health exchange would be a testament to activist government. Instead, Cover Oregon had become a laughingstock. The entire fiasco of mismanagement and missed deadlines posed a threat to Kitzhaber’s legacy as a progressive champion for healthcare reform. So, he surreptitiously handed over control of the Cover Oregon mess to a key campaign consultant—Patricia McCaig—who called herself the Princess of Darkness. Ms. McCaig knew nothing about healthcare policy, but that did not matter. Her job wasn’t to fix Cover Oregon; her job was to get Kitzhaber reelected.
Oregon’s ethics and election laws require a separation between political activity and official decisions. Regardless, the Princess of Darkness (you can’t make this stuff up) believed that the health site’s failure was so politically toxic that she decided to pull the plug. Kill it. Hit the eject button, and flush over $300 million in taxpayers’ dollars down the toilet. Government records and internal emails confirm that McCaig—not state officials—directed the decision to close down Cover Oregon rather than work with the state’s contractor, Oracle Corp., to repair the doomed site. Who cares? As long as Kitzhaber won his bid for a fourth term, the ends would justify whatever means.
Adding insult to injury, the Princess of Darkness then pushed to sue Oracle in a shady effort to deflect blame. The state is now embroiled in lawsuits and former Oregon officials are under myriad congressional and federal investigations.
Facing state and federal criminal investigations, Kitzhaber himself was forced to resign in disgrace earlier this year amid corruption charges and accusations of influence peddling. His handing off Cover Oregon to his chief political consultant and political hacks is but a piece of an overall environment where decisions were based on Kitzhaber’s political interests rather than what was best for the people of Oregon.
Like Alexander from the children’s book “Alexander and the Terrible, Horrible, No Good, Very Bad Day,” perhaps it would have been better for John Kitzhaber to have just moved to Australia. Well, it’s too late for him. However, it’s not too late for other governors to learn from Oregon’s failure. The Supreme Court will issue its decision in King v. Burwell this month. It would be best for the states to work with Congress to craft post-King solutions that will provide market-based healthcare solutions to our nation’s healthcare woes.
Governor Kitzhaber and Cover Oregon is a cautionary yet familiar tale. Big government and corruption are inextricably intertwined. King v. Burwell might give us a rare opportunity to hit the reset button.