This spring, a patient of mine, Richard Gardner, called me regarding a prescription I wrote for him. The drug was Plaquenil, a medication for rheumatoid arthritis, and he was frustrated and angry. The medication was working fine, that wasn’t the problem. The problem was that the price of generic Plaquenil had increased from $30 per month to $85 per month. The brand name Plaquenil would now cost him $200/month.
And this was after his health insurance picked up a portion of the cost.
Raise your hand if you can relate to Richard Gardner. Maybe you’re on four or five medications with yearly out-of-pocket payments of thousands of dollars. Maybe you’re on Tier 5 “specialty drug” where your insurance picks up 80% of the cost and you are left with, let’s see, 20% of $30,000 per year for a biologic drug in rheumatoid arthritis is…$6,000 per year.
We, the purchasing public, frankly, are being fleeced. Martin Shkreli, a former hedge fund manager and founder of Turing Pharmaceuticals, justified his price increase of the anti-parasitic drug, Daraprim, from $13.50 to $750 per pill at a Congressional hearing in 2015 with the simple statement: “Because I can.”
Of course, it’s not just the price of medications which contributes to our ever-rising insurance premiums and $5,000 deductibles. It’s everything.
Let’s spin the wheel of health care costs and it lands on, “Administrative costs.” In my former private practice in Portland, one of our employee’s jobs was to obtain prior approvals for medications and necessary tests. On the other end of the phone was an employee of the insurance company whose job was to say no. Eventually, our office was usually able to get our patients needs met. It was a lot of work. Is it any wonder that roughly 20% of the cost of your private health insurance goes towards administrative costs?
Let’s not leave out hospital costs. As Sarah Kiff recently wrote in Vox: “Americans pay on average $1,119 for an MRI. An Australian pays $215. It’s the exact. Same. Scan.” Several years ago I underwent successful same-day surgery at Maine Medical Center. The charge was $12,791.46. But as I poured over the three-page bill and realized that I had incurred 39 separate charges, I decided to break down the costs. For instance, I was charged $194 for 2 liters of lactated Ringers solution infused during my surgery. When I returned to work the next week I asked our office manager how much our private practice paid for a liter of lactated Ringers solution for our patients receiving IV infusions in our office. Her answer: “Under four dollars.”
Hospitals see thousands of patients each year without insurance and balanced billing is unavoidable if they are to stay afloat. I get that. But come on, $194 dollars versus $4 dollars?
Thankfully, there is a way out of this morass. And it’s not repealing and replacing the Affordable Care Act or even improving the Affordable Care Act. It’s a single payer system, Medicare for All. We need to join the rest of the industrialized world and provide health care to all of our citizens. Implement new laws and allow Medicare to negotiate the prices of medications as the Veterans Affairs and Medicaid programs do. Let Medicare with its extraordinary low administrative costs (estimated at 1-5% as compared to nearly 18% for private insurance) streamline our system so that we get more for less.
In my vision of a healthy America, private health insurance remains in the mix and competes as a secondary payer for the 20% Medicare traditionally does not cover. Heck, keep private health insurance available as primary insurance for those who want to avoid Medicare entirely, similar to the taxes paid by the wealthy to support our public schools even as they “opt out” and pay for their children to attend private schools.
I don’t underestimate how difficult this transition may be. A large portion of our economy is dependent on the health-care industry. Perhaps the transition can be phased in by dropping the Medicare age by 10 years at regular intervals until we cover all Americans. I don’t pretend to have all the answers, no-one does.
But we’re reaching a point where the Richard Gardners in our country is going to demand major change, and that doesn’t mean squeezing into an old pair of jeans which no longer fit. As a nation, let’s buck up and do the right thing. Republicans and Democrats need to come together and adopt a simpler, less costly system, and that’s Medicare for All.