Corporate Giants and the government revolving door create costly and fragmented care

By: Marion Mass, M.D. and Craig M. Wax, D.O.

Insurers, Pharmacy Benefit Managers(PBM), advocacy groups  such as AARP, and others are using their amassed wealth and influence to game the over-complicated and burdensome healthcare system for their own profit on the backs of the American taxpaying patient while fragmenting their care.  Let’s follow one pathway of corporate profiteering that results in a poorer quality of patient care:

United Healthcare’s subsidiary Optum (the company formerly known as Inginex) is one of the three big PBM…  companies that control what drugs your insurance company pays for and how much, while having the government given right to receive kickbacks from pharma manufacturers (conflict of interest much?). These kickbacks are costing Americans $200 BILLION PER YEAR and a prime reason why Optum got so rich. Their 2018 profits put them at the 100 billion mark.

How did a company with a history of fraud get so rich? Round up the usual suspects of the government/corporate cronyism.

After the fraud charges,  Ingenix rebranded itself as Optum, it’s CEO Andy Slavitt left and in 2015 became the Head of Center for Medicare and Medicaid Services(CMS)  while the former head of CMS, nurse Marilyn Tavenner, left to become the president of the insurance industry’s  lobby group AHIP. Slavitt was able to cash out stock options TAX FREE, getting a $4 million windfall.

Curiously, in 2015, while Slavitt is running CMS, Optum seems to take over the publication and administration of the CPT and ICD coding, their logo appearing on the coding material.

As if kickbacks, and coding are not enough, Optum finds another revenue stream via home visits. They send clinicians to medicare advantage patient’s homes often incentivizing the patients with gift cards.  ( apparently they discovered that kickbacks work)  These “wellness visits” prevent patients from being able to see their primary care physician for an annual physical, thus fragmenting care, while failing to forward critical information to the patients’ physicians.

These visits seem designed for Optum to be able to increase risk scores, and thus collect more from Medicare. A possible scenario: order protein levels, often low in elderly patients, increase the patients risk score, and viola!  Optum collects more from Medicare, and thus from the pockets of TAXPAYERS. Apparently, someone in the Justice Department is paying attention, as United looks to be in the hot waters of fraud yet again.

All this money-making benefits the AARP, a formidable lobby force in DC. The AARP gets nearly 50% of its income from royalties the big insurance companies pay them to peddle Medicare advantage plans, the bulk from United/Optum. A mere  17% of AARP’s collections come from membership fees from its 37 million members.
https://capitalresearch.org/article/aarp-advocacy-group-or-crony-capitalists/

There you have it: big insurance and their PBM henchmen, hired by our government, teaming up with the AARP all getting rich gaming the system while Medicare patients get fragmented care and taxpayers pay more. Medicare advantage plans? They ought to call them “taking advantage of taxpayers plans. ”

Marion Mass, MD is co-chair of Practicing Physicians of America (PPA) and Craig M. Wax, DO is PPA’s VP of Health Care Policy.  Learn more: https://practicingphysician.org

American ingenuity and free markets can solve the problem of rising drug prices… if we allow it.

A couple of major threats to the health of the prescription drug supply chain are finally getting some long overdue attention.

  1. We are over-reliant on foreign production.

More than 90 percent of our prescription drugs are either manufactured in China or contain key ingredients that come from China, and China isn’t our best friend. Drugs on this Chinese-sourced list include antibiotics, birth control pills, cancer treatments, anti-depressants, statins (for high cholesterol), and HIV/AIDS drugs.

Why in the world are we outsourcing this mission-critical aspect of American medicine to countries hostile to our nation? (Not to mention the fact that countries like China are stoking the opioid epidemic by exporting deadly illicit Fentanyl to our shores).

Steve Jobs famously took the Obama administration to task over the main reason Apple had 700,000 factory workers employed in China, instead of the U.S:  D.C. is not business-friendly and it is impossible to build a factory in the United States due to regulations and unnecessary costs.

https://www.businessinsider.com/president-obamas-lack-of-resolve-frustrated-steve-jobs-2011-10

Unfortunately instead of cutting the red tape, Sen. Elizabeth Warren and colleagues are proposing exactly the wrong solution to bringing drug production back to the US of A. Instead of unleashing the market forces that built America into the #1 economy in the world, Warren hopes to import the same policies that sank behemoths like the U.S.S.R. and helped ignite the dumpster fires consuming Venezuela and Cuba: nationalized takeover of production.

Even the most profitable industries are not immune to the destruction that government-run production can bring. Case and point: Nationalization has driven Venezuela from oil powerhouse into the poorhouse:

So let’s look for proven solutions instead of dooming the drug industry to a fate of greater drug shortages, stagnation, and even higher prices.

Yes, there is already a sea of red tape and failed policies standing between American patients and inexpensive drugs. Thankfully, unlike Senator Warren, the Trump administration’s FDA Commissioner Scott Gottlieb MD and HHS Secretary Alex Azar seem truly interested in getting to work cutting through it by unleashing competition not warmed over communism.

Which brings us to the second major threat to the supply chain that is getting some overdue sunshine:

2) Kickbacks to Group Purchasing Organization and Pharmacy Benefit Manager Middlemen.

According to nomiddlemen.org:

GPOs and PBMs are perpetrating “a dangerous and unethical game of ‘pay-to-play.’ It’s the dirty little secret behind the outrageous cost of medications and the shortages of many drug and medical supplies. Unfortunately, a law was passed that allows these medical market “middlemen” to accept kickback payments from drug and medical supply companies in exchange for exclusive sales contracts! It created a government-sanctioned system of racketeering that would be illegal in any other industry.

 

The FDA along with HHS have signaled a willingness to end the kickbacks. And since the beginning of 2019 Senator Susan Collins and the new Chair of the Senate Finance Committee, Chuck Grassley have also stated they are going to take a close look at these shameful business practices

https://www.collins.senate.gov/newsroom/senator-collins-urges-administration-prioritize-reducing-drug-prices

https://www.grassley.senate.gov/news/commentary/grassley-top-priority-reducing-health-care-costs

Bottom line? American ingenuity can solve the problem of rising drug prices. If we will let it.

Take Action by Jan 11: Eliminate the #GPO #PBM Middlemen #Safeharbor Creating Drug Shortages and High Prices

“Drug shortages are pretty much a daily disaster right now for most hospitals,” reported Pharmacy Times on December 10. Meanwhile, “The US Food and Drug Administration (FDA) is not just seeing an increase in drug shortages but also a spike in the intensity and duration of shortages,” writes Zachary Brennan, summarizing conclusions from an FDA event last month.

This summer FDA Commissioner Scott Gottlieb, MD convened a Drug Shortage Task Force “to seek root causes of drug shortages and potential enduring solutions.”

The Task Force has issued a request for public comment as it prepares a report to Congress, and the deadline to submit solutions is January 11. Please help us, your colleagues, and your patients, take advantage of this opportunity to share a few key ideas with the Task Force.

Here’s how you can help! Continue reading