Patients Pay $Thousands$ for Drugs Even When They're Insured

I don't know how long ago it was that Rob began warning about the new Medicare regulations promulgated by the Bush Admin but it was years at least. The NYT is reporting that Rob's dire predictions are coming true and they're worse than we imagined.

Health insurance companies are rapidly adopting a new pricing system for very expensive drugs, asking patients to pay hundreds and even thousands of dollars for prescriptions for medications that may save their lives or slow the progress of serious diseases.

With the new pricing system, insurers abandoned the traditional arrangement that has patients pay a fixed amount, like $10, $20 or $30 for a prescription, no matter what the drug’s actual cost. Instead, they are charging patients a percentage of the cost of certain high-priced drugs, usually 20 to 33 percent, which can amount to thousands of dollars a month.

The system means that the burden of expensive health care can now affect insured people, too.

No one knows how many patients are affected, but hundreds of drugs are priced this new way. They are used to treat diseases that may be fairly common, including multiple sclerosis, rheumatoid arthritis, hemophilia, hepatitis C and some cancers. There are no cheaper equivalents for these drugs, so patients are forced to pay the price or do without.

Insurers say the new system keeps everyone’s premiums down at a time when some of the most innovative and promising new treatments for conditions like cancer and rheumatoid arthritis and multiple sclerosis can cost $100,000 and more a year.

But the result is that patients may have to spend more for a drug than they pay for their mortgages, more, in some cases, than their monthly incomes.

The system, often called Tier 4, began in earnest with Medicare drug plans and spread rapidly. It is now incorporated into 86 percent of those plans. Some have even higher co-payments for certain drugs, a Tier 5.

(emphasis added)

This was almost inevitable with the way the Bush prescription drug plan was written - and sold. He as much as told Big Pharma that they could start charging more and there would be no consequences. So they did.

What you need to keep in mind is that bogus use of the word "costs". When Big Pharma reckons "cost" what is supposed to be a number made up of the costs of materials and manufacturing becomes instead a number made up of the costs of the research they didn't pay for, grossly inflated (most of these drugs were developed by universities and the NIH - one on govt grants & the other a govt agency, both of them paid with our taxes - and given to the companies by either the administration or the Republican Congress), the tests of the drug they may not even have done, the costs of faking those tests if they didn't pass the first time (sorry but Big Pharma considers that a legitimate expense and pays the people who do it), and the costs of their advertising to doctors and hospitals.

That advertising, btw, is some of the most expensive in the world. It includes paying reps to travel the country selling hospitals on the efficacy and availability of the drug, gifts to doctors and hospital administrators (and we're talking expensive cars and all-expense-paid Caribbean vacations, not refrigerator magnets and tiny bottles of white-out), and a potential multi-layer media blitz of standard ads on tv and in trade publications.

Finally, there is this: when Big Pharma measures its "costs" it includes the markup. That's right, campers. When it assesses its costs for the purposes of discounting, it includes the profit it would have made if the drug had been sold at full price. So on top of the rest of their cost scam, they add the 40%+ they would have added if they'd sold the drug on a theoretical "open market".

This is what they've shown consumer advocates when they've been challenged about their pricing, and negotiators around the world (except in the US, where Medicare is forbidden by law from such negotiating) have used these facts to push drug prices down from the stratospheric prices charged in the US to the bargain basement prices charged overseas. Which low prices they then report as "charitable contributions" and get the difference written off on their taxes.

It's not by accident that Big Pharma's profits are second only to the record-breaking profits made by Big Oil since Bush became president (remember, Rumsfeld used to be a Big Pharma CEO). It's by design.

Bush Design.