Their Own Medicine.

AuthorQuigley, Fran

PATIENT ACTIVISTS WERE ONCE AT THE FOREFRONT OF LOWERING THE COST OF LIFE-SAVING MEDICATION. TO SOLVE TODAY'S PRESCRIPTION DRUG CRISIS, THEY'LL HAVE TO FIND THEIR VOICE AGAIN.

Why is it so hard to lower the cost of prescription drugs?

Consider the fate of an utterly modest, tentative attempt in the waning days of the Obama administration. In 2016, under a little-known provision of the Affordable Care Act, the Department of Health and Human Services proposed a plan to study one aspect of the problem: the amount Medicare pays for drugs administered in physician offices, which had more than doubled in just eight years. Under the existing practice, physicians who administer medicines in-office, usually for cancer, rheumatoid arthritis, or eye disease, are reimbursed for the average cost of the drugs plus 6 percent of those costs. It's a classic case of perverse incentives: the higher the cost of the treatment, the more the doctor gets paid. Several studies confirm what common sense predicts: the approach causes physicians to prescribe more expensive drugs than they otherwise would. The proposed five-year experiment would change the physician reimbursement to a flat fee plus 2.5 percent of the drug cost. The costs to Medicare would be compared with a control group still reimbursed at the 6 percent rate. If costs dropped under the new reimbursement plan, Medicare would consider switching to it permanently.

At first glance, reactions to the proposal were predictable. Consumer groups, including the AARP, liked it. Physician groups and pharmaceutical companies, both of which stood to lose substantial income from a switch, opposed it. More surprising was the addition of some powerful allies speaking out on the side of physicians and Big Pharma: patient advocacy organizations. One hundred and forty-seven such groups--with names like the Epilepsy Foundation, the Kidney Cancer Association, and the Lung Cancer Alliance--signed a letter to Congress and the Obama administration insisting that the plan would "represent a major step back for patients and people with disabilities." Lawmakers from both parties, including Democrat Nancy Pelosi and Republican Tom Price, the future secretary (and now ex-secretary) of HHS, started echoing the patient groups' objections, overwhelmingly opposing the experiment. In December 2016, the Obama administration withdrew the proposal.

Why would groups representing medical patients, who rely on prescription drugs, oppose an attempt to make those drugs less expensive? There's no doubt that they held honest concerns about potential unintended consequences. But there was another variable at work, too. Patient groups face their own perverse incentive: drug industry money. A study by the advocacy group Public Citizen found that three-quarters of the patient groups that publicly opposed the Medicare experiment received funding from the pharmaceutical industry. That is almost surely an undercount, since the groups are not required to disclose their donors.

Patient advocacy groups have a sterling reputation among the public and lawmakers alike. They provide patient and family education, counseling, and even financial assistance during difficult times, along with advocacy for increased awareness and prevention strategies. But when it comes to drug pricing, their reliance on pharmaceutical industry funding, along with a natural desire not to imperil development of new treatments, typically puts patient groups on the side of the industry.

And that is a problem, because the industry is the driver of the prescription drug pricing crisis. Over the past forty years, pharmaceutical companies have relentlessly pushed for federal policy to keep prices high, arguing that huge profits are essential to stimulate investment into new medicines. Thanks especially to laws and trade agreements giving drug companies lucrative patent protections, the industry has become one of the most profitable sectors in history. And it has used those profits to build substantial political clout, employing more than twice as many lobbyists in Washington, D.C., alone as there are members of...

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