“Americans are paying the highest prescription drug prices in the world,” said Executive Vice President and Chief Advocacy & Engagement Officer Nancy LeaMond of AARP’s national office. “It’s time for pharmaceutical companies to stop deflecting blame and acknowledge that the root cause is the price they set for their products.”
US drug prices for both patients and providers are much higher than in other nations and going up rapidly (10 percent in the first six months of 2019). Governmental action at the national level is long overdue, a fact acknowledged by both President Trump and the Democrats. Regulation would have taken place long ago if not for the drug company lobbyists’ money and corresponding clout. Therefore, I was very glad to hear that drug pricing reduction has been declared a state and national AARP priority with the March launch of its “Stop Rx Greed” campaign.
Before I retired, I was a VP and SVP for some of the largest healthcare group purchasing corporations in the nation, each purchasing billions of pharmaceuticals annually for some of the largest and best hospital systems in the nation. I learned a lot in my 20 years in that field, supervising pricing analysis of over a hundred major US hospital systems.
One of the key things I found was that pharmaceutical corporations will lie with a straight face regarding their pricing, even to major hospitals and large physician groups. You are always getting the lowest price possible; just ask your pharmacy rep and he will tell you so and then take you to the Super Bowl.
Group purchasing, especially if it is a “committed buy” (i.e. the hospital or physician group will mandate use of that product and no other), will bring down pricing somewhat. But even healthcare providers pay much more than in other nations, which I discovered while supervising multiple pricing studies with four Canadian Provinces.
Plus, individuals don’t have that kind of clout and are the victims of price gauging by massive, well-connected pharmaceutical corporations who have been gaming the system for decades, increasing prices much faster than inflation. For example, the price of insulin, a well-established drug, tripled from 2002-1013 for no reason other than Big Pharma corporate greed. And, higher drug prices and unreasonable price increases are then passed on to privately insured patients in the form of higher and higher premiums and deductibles. And, increased Medicare costs for seniors, causing funding shortages and inevitable eventual tax increases.
Drugs are becoming more and more unaffordable for a middle-class family, much less the working poor and retired seniors. According to AARP, from 2012 to 2017 Georgians experienced a 58 percent increase in prescription drug prices, while family income went up under 10 percent. The average income of a Medicare part D enrollee is only $26,000, clearly not enough for many seniors to afford the 4-5 prescriptions that they fill each month. National studies have shown that, solely due to cost, many of our elderly are going without the drugs that have been prescribed to them.
The Prescription Drug Pricing Reduction Act, currently being considered by the Senate, is a good first step in controlling unnecessary price increases by greedy drug companies. The Act would prevent pharmaceutical prices from exceeding the rate of inflation, while capping out-of-pocket costs for Medicare recipients.
However, there is massive opposition by Big Pharma. They are spreading their money around both to buy off our politicians and to run misleading ads stating that somehow reasonable government regulation of drug pricing increases will hurt patients.
It’s up to each of us to support AARP in its campaign to restrain outrageous and unnecessary drug pricing. Call the Senate offices of Senator Perdue and Senator Isakson at 202-224-3121 and say that you support The Prescription Drug Pricing Reduction Act and expect them to do so as well if they want your vote.
We pay more for drugs than other advanced nations who long ago controlled price escalation. If the rest of the developed world can do it, why can’t we?