A Federal Pharmaceutical Program Should Stop Green Lighting Price Gouging On Drugs!

Discussion in 'Health Care' started by JimfromPennsylvania, Dec 22, 2022.

  1. JimfromPennsylvania

    JimfromPennsylvania Active Member Past Donor

    Joined:
    Mar 9, 2010
    Messages:
    611
    Likes Received:
    135
    Trophy Points:
    43
    Congress and the President should tweak a Federal Government program called the 340B program, named after the Federal statute that created the program, so that it actually helps needy Americans which is the justification for the program! What the 340B program did initially and still does is that it allows hospitals that have a significant number of low income Medicare and Medicaid patients to purchase out-patient drugs at a steep discount from pharmaceutical companies, these companies must give the hospitals a rebate for the amount of price increases over the inflation rate for all the years the respective drug was on the market. The Wall Street Journal recently reported that its investigation found that the typical discount is thirty-five percent off from what hospitals not in the program pay and the amount of purchases by participating hospitals was at least $38 billion in 2021. With the Affordable Care Act the program was opened up to rural hospitals with a lose definition of "rural" resulting in a lot of big city non-profit hospitals now participating. Further, the program allows participating hospitals to pass on this right to a discount on to all their affiliated clinics and offices. This is the big wrinkle with this program a lot of financially strong non-profit participating hospitals are "not" passing on the drug savings to their low and middle income patients. Any person with competent knowledge about the effects of drug prices on Americans knows that the price of drugs often is really a hardship and stings the American consumer and to think financially well-off hospitals are sticking it to their low and middle income patients on drugs when they don't have to because they are paying vastly lower prices for these drugs is unfair and unconscionable. Elected officials in Washington need to get on the job here and protect these vulnerable Americans from this price gouging on drugs, this injustice should make every Americans blood boil! The program could require the participating hospitals to set up a program within this program to identify their low and middle income patients and mandate the discount be passed on to these patients and their insurance companies; but, I think the better outcome because it saves on more administrative expenses on hospitals and most ordinary patients are staggered with the billing effects of healthcare and so many probably won't file the right paperwork to participate all pointing to the better outcome being that the regulations should mandate that all participating hospitals pass on the discount to all their patients and those patients insurance companies!
     
    Last edited: Dec 22, 2022
  2. kazenatsu

    kazenatsu Well-Known Member Past Donor

    Joined:
    May 15, 2017
    Messages:
    34,640
    Likes Received:
    11,209
    Trophy Points:
    113
    Isn't it true that price gouging on drugs helps incentivize research for drugs?
    Many people seem to want something for nothing. You want cheap drugs, but you also want drugs that took lots of (expensive) research and development to come into being.

    The only fair practical solution I can see to this is to get government to start doing research into developing pharmaceuticals. Hopefully it will be government will develop new drugs, and then there will not be price gouging on those drugs. Research and development is one of the few economic activities that government is about equally good at as a large corporate business.
     
  3. Kode

    Kode Well-Known Member

    Joined:
    Feb 5, 2016
    Messages:
    26,311
    Likes Received:
    7,461
    Trophy Points:
    113
    Gender:
    Male
    Isn’t it true that we currently have a proliferation of drugs for Baby Boomers, mainly, and they all have very serious possible side effects? I’m not so sure incentives for profit research is a good idea.
     
  4. kazenatsu

    kazenatsu Well-Known Member Past Donor

    Joined:
    May 15, 2017
    Messages:
    34,640
    Likes Received:
    11,209
    Trophy Points:
    113
    This kind of sounds like an idea from stupid people who have no understanding of economics or math.

    Forcing a business to provide something at a discounted price to one group usually ends up raising the price for everyone else.

    That doesn't really sound like the best way to address high drug prices. It's like a tax on average people trying to buy medication to help one small group a little bit.
     
  5. kazenatsu

    kazenatsu Well-Known Member Past Donor

    Joined:
    May 15, 2017
    Messages:
    34,640
    Likes Received:
    11,209
    Trophy Points:
    113
    This sounds like more stupidity and emotion, in my personal opinion.

    I don't think "passing on savings" really has anything to do with the issue.

    If (and this is a big hypothetical) hospitals were able to suddenly cut costs in a certain area but it did not end up resulting in a price decrease for the final consumer in that area, then that would suggest that the prices are not being determined by the costs. In fact that would be kind of an argument to cut the program providing the low prices altogether for the hospitals, or at least some hospitals.

    Something I suspect you would not support.

    So it seems like a you are complaining about a problem but have not clearly defined a cause, or the solution. You simply want politicians to "do something".

    They've already been "doing something" and it hasn't really done much to solve the problem. We need to think more carefully about exactly what should be done. But before we can do that, we need to try to correctly figure out what the cause of the problem really is.
     
  6. kazenatsu

    kazenatsu Well-Known Member Past Donor

    Joined:
    May 15, 2017
    Messages:
    34,640
    Likes Received:
    11,209
    Trophy Points:
    113
    I don't think this idea of yours would really help much. The majority of patients are low and middle income. Diverting subsidies away from patients with more money wouldn't help them very much, I don't think.
     
  7. kazenatsu

    kazenatsu Well-Known Member Past Donor

    Joined:
    May 15, 2017
    Messages:
    34,640
    Likes Received:
    11,209
    Trophy Points:
    113
    Most of the wasteful "administrative expenses" are in insurance. If you were to figure out some way to be able to eliminate insurance, you could dramatically reduce medical costs.

    It may not be true for the individual, of course, but that does not mean it would not be true for the whole (an example of the fallacy of composition).

    This might look like some sort of hybrid H.M.O. plan, where you just pay some membership fee to a hospital network and they agree to take care of you. Maybe with some annual deductible and small fixed copays for procedures you have to pay, set by the government. (Even though the amount of the annual fee to the H.M.O. would not be set by the government, so this would not involve true price-fixing)
     
    Last edited: Feb 16, 2023
  8. kazenatsu

    kazenatsu Well-Known Member Past Donor

    Joined:
    May 15, 2017
    Messages:
    34,640
    Likes Received:
    11,209
    Trophy Points:
    113

Share This Page