Winning the Healthcare Debate

 

Who is winning the healthcare debate? Based on the mid-term elections, it seems that Democrats are winning. Is this correct and is it good for the country?

These are critical questions as we move into the 2020 presidential election campaign. The winners in the healthcare debate should be those whose ideas will benefit the healthcare of the citizens most. But that may not be happening.

John C. Goodman, healthcare economist writing in Forbes, thinks the Democrats are winning the debate – but not because they have the best ideas. He blames Republicans for losing because they are always on the defensive and do a poor job of explaining their ideas.

Goodman says the Republicans, under President Trump, have recently done three things that help liberate people from the burdens of ObamaCare:

  • Eliminated the Individual Mandate
  • Allowed purchase of short-term insurance (STLDs)
  • Allowed Association Health Plans (AHPs)

 

These three changes are making healthcare more affordable for millions of Americans. The Council of Economic Advisers (CEA) reports that the people who benefit from these changes will experience a gain worth $45 Billion a year! The CEA concedes that this will lead to slight rises in premiums for middle-income enrollees as healthier people exit ObamaCare, but the benefits to those who gain far outweigh the costs to those who lose.

But Democrats use emotional talking points to overcome facts and reason. They argue that these Republican reforms weaken protections of ObamaCare. Although only about 5% of people with private insurance are buying individual plans, the vast majority, who have employer-provided plans, view the individual market as the market of last resort. Therefore, they vote on emotional reactions to the Democratic scare tactics even though they are not affected.

Goodman says these Democratic scare tactics will continue to be effective in the healthcare debate unless Republicans come up with better answers. He points out four Republican mistakes:

  • Republicans are usually unable to explain why young, healthy families choose “skimpy” plans (STLDs) over “comprehensive” plans (ObamaCare) and why that is the right choice, even when the out-of-pocket premium is the same.

Low-income, healthy families would always prefer a lower-deductible plan even if the total coverage is much less. They don’t have the money to afford high deductible plans that offer much greater coverage and they don’t worry about high expenses from serious illness. ObamaCare forces them to purchase high-deductible comprehensive plans but they prefer the STLDs because they can afford them.

 

  • Republicans do not seem to understand that public insurance and private insurance must complement each other, and they are unable to explain how the complementarity is going to work when they advocate limited benefit insurance.

Sometimes public sector funding does a better job than private funding. Rare birth defects and substance abuse including alcoholic mothers are good examples. Goodman suggests public coverage for these conditions be available for everyone and only an option in private insurance. Otherwise, private insurance gets too expensive.

 

  • Republicans have never been able to explain convincingly how care for people with pre-existing conditions will be just as good or better under any proposal they have ever favored.

To counter this problem, Pete Sessions, Mark Meadows and other House Republicans proposed a House resolution on pre-existing conditions last year. It said that in any reform of ObamaCare, states must:

  1. Guarantee that people with health problems will get better health insurance.
  2. Set as an attainable goal: People who migrate from the group market to the individual market should be able to find similar insurance in terms of price, quality and access to care.
  3. Allow health plans to specialize and offer better care for such conditions as cancer, heart disease and diabetes.

 This is a good way to assure voters they are looking out for them.

  • While everyone agrees that the healthy subsidize the sick under ObamaCare, Republicans have never explained the alternative. Who should subsidize the sick and how should that subsidy work?

Most Americans get their health insurance from their employer because the federal government doesn’t tax it as income. But when you leave your employer because you are sick, you’re forced to purchase your own insurance when you need it most and can afford it least. A better solution is to allow states to impose a small premium tax on all group insurance that would subsidize above-average-cost patients forced into the individual market. Employers could avoid the tax by helping their employees buy individually owned insurance – which travels from job to job (like an IRA).

Healthcare is a complex issue not easily explained to voters. Republicans have better ideas but Democrats have better talking points that stress scare tactics over facts. If Republicans want to win over voters in the healthcare debate, they will have to be better communicators.

Lowering Drug Prices – Without Causing Harm

 

The primary axiom of the Hippocratic Oath taken by doctors is “First, do no harm.” This is important to remember when taking steps to lower drug prices.

Scott W. Atlas, writing in The Wall Street Journal, reminds us of this axiom and points out the benefits to Americans of those high drug prices we pay. Among these benefits are the following:

  • Early access to lifesaving drugs – Between 1995 and 2005, 12 new cancer drugs were first introduced in the U.S. versus 13 introduced in Canada, France, Germany, Japan, Switzerland and the United Kingdom combined!
  • More new drugs available – Of the 45 novel drugs the Food and Drug Administration approved in 2015, 29 were available in the U.S. first. A 2017 study found that all 45 approved new caner drugs were covered by Medicare in the U.S. compared with pubic insurance coverage of only 26 in the U.K., 19 in France, 13 in Canada and 11 in Australia.
  • Superior treatment results –America has superior treatment results for virtually all serious diseases reliant on drug treatment, including cancer, heart disease, stroke, high blood pressure and diabetes.

 

Bad Ideas for Lowering Drug Prices

None of this is to suggest that drug prices could not be lower than they are without giving up these benefits. But some of the suggested ways of lowering drug prices can cause greater harm than good. Here are some bad ideas that have been suggested:

  • Price Controls – Price controls have never been effective in controlling costs and prices in the past and usually lead to shortages. A 2014 study of 642 drug launches in 76 countries found that price regulation “strongly delays” them. A 2005 study estimated that drug price controls would have led to 198 fewer new drugs in the U.S. market from 1981 to 2000, at a societal cost of about $20 Trillion, or more than 28 times the estimated savings from those price controls.
  • Drug Prices Tied to Foreign Countries – This idea is supported by President Trump and Senator Bernie Sanders, unlikely allies, but both are misguided. Atlas says this would ultimately lead to the same consequences Europeans endure – reduced access to critical drugs and worse outcomes, including more deaths from disease. Why give up our advantages over the Europeans?
  • Price Negotiation by Medicare –It may seem logical that negotiation by a single dominant buyer would lower prices. But economists have concluded that would lead to supply shortages and fewer new products. Even worse, only the patient, not the negotiator, would suffer the severe penalties of sickness and death when drug availability and pharmaceutical innovation dries up. The U.K.’s National Health Service launched its 2017 Budget Impact Test which delayed any new drugs up to three years if projected spending exceeded benchmarks, regardless of effectiveness.

 

Good Ideas for Lowering Drug Prices

The Trump administration has proposed eliminating rebates paid by drug manufacturers to pharmacy benefit managers (PBMs), replacing them with discounts to beneficiaries at the point of sale. PBMs are middlemen who control formularies, the list of drugs covered by insurance plans. These rebates are payments for influence – either to position a drug on the formulary as “exclusive” or to give it preferred status over competitors.

Atlas explains: “PBMs act counter to patient interests while aggravating the lack of price transparency. These complex behind-the-scenes payments – $179 billion in 2016 – reward inflated list prices, on which patient premiums are often based. This prevents patients from taking account of price. Some PBMs even use contractual gag clauses to prohibit pharmacists from volunteering that a medication may be less expensive if purchased for cash – as it was in more than 20% of cases, according to a 2018 study.”

Atlas calls this proposal necessary but insufficient. He believes there is insufficient transparency in drug pricing to allow consumers maximum benefit. Rather, he would eliminate PBMs entirely. He says it would be better to require patients to pay directly for more of their drugs and reward them for saving money. Cheaper, higher-deductible drug insurance, coupled with larger, liberalized-use health savings accounts, would accomplish both goals – especially for seniors. HSAs are currently prohibited for seniors.

 

Other measures needed include:

  • Reducing barriers to the supply of new and competing drugs
  • Shortened clinical trials to reduce costs and speed drugs to the market

 

The importance of drugs to combat diseases cannot be overstated. The most significant progress in extending life expectancy has come from new drugs. We must avoid policies that undermine this progress while providing lower cost drugs the public can afford.

Science is Never Settled

 

Scientists and doctors are always learning.

When I began my medical school education 44 years ago, the Dean of the Medical School told us, “Half of what we’ll teach you in the next four years is wrong. But we don’t know which half.”She made this statement to emphasize the importance of viewing medicine as a life-long education – not just four years.

Many political activists insist that “the science is settled” whenever anyone pushes back against their so-called scientific conclusions. They dare you to challenge their interpretation of science whenever it threatens their political agenda. But real scientists and doctors know we are always learning and making new discoveries about the scientific world.

This truth was brought home recently in a powerful way for one family. Jaime Herrera Beutler is the Congressional representative of Washington’s Third Congressional District. She told her story in a recent Op-ed to the Wall Street Journal.

Beutler and her husband faced every expectant mother’s nightmare. When they went to her obstetrician for her 20-week ultrasound, the doctor told her their unborn baby had no chance for survival. The baby had no kidneys. Bilateral renal agenesis, or Potter’s Syndrome, usually results in miscarriage or suffocation at birth because the lungs don’t develop.

Their doctors said there was no solution to this situation and most women in this situation would terminate the pregnancy by abortion. But Beutler and her husband refused to get an abortion.

They prayed and looked for other medical opinions. They tried something that had never been done before: saline infusions in utero to mimic amniotic fluid, which stimulates lung development. Their baby successfully developed lungs even without kidneys and today their daughter, Abigail, is a happy, healthy girl who tells her mother she wants to eventually be Speaker of the House of Representatives!

Their doctors were wrong – because the current level of knowledge of this condition was incomplete. New methods of treatment led to new discoveries and new knowledge – further proof that science is never settled.

Last year I wrote about this in Settled Science Fiasco Remembered, a 50-year look back at the false scientific claims of Stanford biologist Paul Ehrlich. Ehrlich wrongly predicted a global cataclysm in his book, The Population Bomb,because he believed the earth could not sustain the growing population. Ehrlich erroneously concluded the “carrying capacity” of the Earth was “settled science.”

The happy ending to Rep. Beutler’s pregnancy nightmare is critical to remember when politicians want to push abortion even into the third trimester – or, gasp!, even after birth – as recently debated in the Virginia legislature. Every life is precious in God’s sight and should be in ours as well.