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Back to Basics – Medicare’s Prescription Drug Program

I thought this week would be a good time to get back to basics on Medicare’s prescription drug program. I realize that any “back to basic” blog has the potential to be boring but stay with me on this. I think that almost everyone will find out something about their prescription drug coverage that they didn’t know.

I do realize that some of you may not have your prescription drugs covered under Medicare; you may be covered under a commercial prescription drug program as part of your employer’s employee or retired insurance benefit. If this is the case in your situation it still might be worth your while to read on. Some of this information is relevant to commercial insurance. I also will be talking mostly about the standard Medicare Part D plan for standard Prescription Drug Plans (PDP). Having said that, much of the information and nomenclature will also apply to Medicare Advantage (MA) Part D benefits.

There are important words and phrases that you need to understand as you deal with your prescription drug costs.

  • Deductible – Most of us have dealt with deductibles over the years with our commercial plans. Many types of insurance have a certain amount you pay before your insurance starts to help with paying costs. Under PDP’s the yearly deductible in 2021 was $445; after that you had to pay Coinsurance.
  • Coinsurance – This is where you pay a percentage of the drug cost. In Part D you pay 25% of the drug cost until you reach the TrOOP limit.
  • TrOOP – The True Out Of Pocket cost. When you’ve paid $6,550 you reach the catastrophic coverage period in your Part D prescription drug plan; at this point, the beneficiary pays $3.70 for a generic or preferred drug and $9.20 for other drugs, or 5% coinsurance, whichever is greater.

While the amounts and rules of the phrases above may not be the same in a Medicare Advantage prescription drug program, the general meaning and importance do apply. There are two other words that are important as you review your drug coverage each year.

  • Formulary – The formulary is the list of drugs that are covered and available in a specific drug plan.
  • Tier – Drugs in a plan’s formulary can be placed in different tiers. These tiers are important because your out-of-pocket costs may be different depending on which tier your drug is in.

You can see why the formulary and tier are important considerations as you choose your Part D plan in a PDP or a MA drug plan.

The Medicare Part B benefit is another program where you may receive prescription drugs. Part D drugs are usually obtained at the drug store while Part B drugs are administered or obtained at a doctor’s office or as an outpatient at a hospital. The Part B drugs are often injectable, which frequently requires a doctor’s office visit. An example of this type of drug is treatment for cancer. These Part B drugs are often expensive and it’s one of the primary places where the government would like to control prices. Part D and Part B are two Medicare benefits where we are required to pay monthly premiums.

The Part D premiums have stayed very stable over the last ten years, with the average premium being $38 per month in 2012, going to a high of $41 per month a few years later and returning to $38 in 2022. These premiums are an average of the premiums paid by seniors for different types of Part D coverage administered by private health plans in different states. Most states had over 20 different prescription drug insurance plans to choose from. That type of premium stability is unbelievable, especially in these days of inflation. I credit most of the stability to competition with maybe a touch of plan design and cost shifting thrown in.

The Part B premiums are more expensive and reflect what the government spent on funding this benefit. They were $148 per month in 2021 but went up to $170 per month in 2022. This was the largest increase ever. Some of the increase was because of increased utilization and the government’s reduction of the calculated premium last year due to COVID-19. The premium, according to the government, was also affected by “the uncertainty” regarding the potential use of the Alzheimer’s drug Aduhelm by people with Medicare. The secretary of Health and Human Services has requested that Medicare reassess the premium cost. There’s a chance we might get a refund!

One of the things some people don’t realize is that the Part D and Part B premium costs will go up depending on your income. This is due to IRMAA (not your aunt Irma but the Income-Related Monthly Adjustment Amount.) For Part D there’s a monthly premium add-on of $12.30 if your joint income is above $176,000 per year. The monthly premium add-on continues to go up until it equals $77.10 a month for a joint income over $750,000. For Part B the monthly premium add-on is $68.00 if your joint income is above $183,000 a year. It continues to go up until it equals $408.20 a month for joint income above $750,000. Some may ask (me included) why our income should determine the amount we pay when we all paid into the program our whole life an amount that was based on our income. That’s not an issue to explore today but perhaps in a future blog, just a minor rant today I had to get out of my system

The CMS website is a great place to find a lot more detail about your prescription drug benefits. You will be able to dig as deep as you like to find out a lot more about this great benefit.

One thing to know, there is a lot to consider as you make your initial choice of a prescription drug program or as you do your yearly review. The lack of standardization, especially among the tiered plans, means that it is virtually impossible to compare plans and Part D cost-sharing without the use of CMS’s online Plan Finder tool. While the Plan Finder is relatively easy to use, Medicare beneficiaries who lack confidence in their computer skills should ask family, friends, their local pharmacy, or their area State Health Insurance Assistance Program (SHIP) agency to help them compare plans on the Plan Finder. There are resources out there to help you.

I hope you found out something new about Medicare Part D. It’s a great benefit that continues to be a life enhancing and lifesaving program.

Best, Thair



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Arthritis Awareness Month – A Chance to Become Aware

This month is Arthritis Awareness Month with Aware being the operative word. The number of people affected by arthritis in America is shocking. Over 50 million adults and 300,000 children suffer from arthritis, and it is the leading cause of disability in our country. The one thing I know is that most of us either have firsthand experience with the disease or at least know someone who is affected by it. The mere fact that over 50 million of us have it means that there are a lot less than six degrees of separation from us and an arthritis sufferer (my apologies to Kevin Bacon). So . . . why should we be aware?

The first thing we should be aware of is that there are over 100 different types of arthritis, and the diagnosis and treatment may be different depending on the disease type. There are some common symptoms that we can look for to help us decide if we need to see a doctor. We’ll get into those in a minute. We do know that there are benefits in catching arthritis early. There are medicines and actions we can take to slow the onset of the disease and, in some cases, put it in remission. I think it’s important at this point to talk a little bit about remission. Many people who have arthritis define remission as the absence of pain or symptoms. Doctors, on the other hand, may not classify the disease the same way. They may see the continued presence of the disease and its continuing detrimental impacts on your body even with the absence of pain and not declare the disease as in remission. There are two things that this difference of opinion brings up. First, when I talk with people who suffer from arthritis, they say that if the pain was eliminated, they would call it remission because they feel that pain is the most debilitating part of arthritis. Second, we need to also listen to the doctor when they talk about not being done with arthritis just because the symptoms have stopped. Their advice and treatments are important, and we need to continue with the medicine or treatment that they prescribe. It’s always hard to stay vigilant against an unseen and non-painful enemy but it’s important to not let our guard down.

Ok, so now that we are aware of this disease that affects a lot of us, how do we recognize it and what do we do? As you might imagine the Arthritis Foundation has some great guidance on these two questions.

1. Pain – Pain from arthritis can be constant or it may come and go. It may occur when at rest or while moving. Pain may be in one part of the body or in many different parts.

2. Swelling – Some types of arthritis cause the skin over the affected joint to become red and swollen, feeling warm to the touch. Swelling that lasts for three days or longer or occurs more than three times a month should prompt a visit to the doctor.

3. Stiffness – This is a classic arthritis symptom, especially when waking up in the morning or after sitting at a desk or riding in a car for a long time. Morning stiffness that lasts longer than an hour is good reason to suspect arthritis.

4. Difficulty moving a joint – It shouldn’t be that hard or painful to get up from your favorite chair.

What do you do if you experience some of these symptoms?

Your experience with these symptoms will help your doctor pin down the type and extent of arthritis. Before visiting the doctor, keep track of your symptoms for a few weeks, noting what is swollen and stiff, when, for how long and what helps ease the symptoms. Be sure to note other types of symptoms, even if they seem unrelated, such as fatigue or rash. If you have a fever along with these symptoms, you may need to seek immediate medical care.

If the doctor suspects arthritis, they will perform physical tests to check the range of motion in your joints, asking you to move the joint back and forth. The doctor may also check passive range of motion by moving the joint for you. Any pain during a range of motion test is a possible symptom of arthritis. Your doctor will ask you about your medical history and may order lab tests as needed.

Most people start with their primary care physician, but it’s possible to be referred to doctors who focus in treating arthritis and related conditions. Getting an accurate diagnosis is an important step to getting timely medical care for your condition.

It seems like I always have some story to tell about my own experience. I started having pain in my left index finger and a bump in my palm that hurt. I thought it was arthritis since it mirrored some of my wife’s symptoms who is suffering with arthritis in her fingers, but she urged me not to ignore my seemingly accurate self-diagnosis and see the doctor. Strange as it might seem, my diagnosis was wrong. It turned out to be trigger finger syndrome and I was able to take some ibuprofen and do some exercises and rest, and it went away. The point of this story is, look at the symptoms, track them and gather information as indicated above and see your doctor; they are the ones who can make the correct diagnosis and either treat you or get you to a specialist.

This a great month to become aware of the symptoms of arthritis and, if needed, do something about them. I hope May finds you in good health and good spirits.

Best, Thair



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What Will Congresses’ Next Step Be on Healthcare?

After a two-week break Congress is coming back in session at a time that historically has been an active period for passing legislation. This time, however, there might not be much activity. As you probably know the Build Back Better (BBB) Act failed to gain traction at the end of last year. The House passed the BBB Act, but it died in the Senate due to the reluctance of Senator Manchin to pass legislation that cost over two trillion dollars on programs that he didn’t think were needed. Parts of the Build Back Better Act passed by the House would have made changes to Medicare. It would have added some level of eye, hearing and dental benefits, initiated government price controls on many prescription drugs, and would have set a cap on the yearly out-of-pocket costs in the Medicare prescription drug (Part D) benefit. I’ve commented in a recent blog on how destructive government price controls would be. In that same blog I stated that a yearly out-of-pocket cap on costs for Part D would be a great change. While adding benefits seems like a positive change the costs and the details for the added benefits would need to be carefully scrutinized.

I’ll go out on a limb (a pretty secure limb) and say that the BBB Act as passed by the House is dead. I’ll go out on a little less secure (but still pretty secure) limb and say that pulling out some of the parts of the BBB Act that affect Medicare and passing them in some other smaller bill is not going to happen in the next few months. Given that assessment I would like to talk about some overall long term healthcare changes that Washington should be considering.

We need to somehow wean ourselves away from a fee for service healthcare system. It magnifies the wrong incentives by focusing on volume rather than outcomes. This doesn’t mean we should cut back on tests and procedures that give us the advantage of early detection of health problems; it means we should pay attention to best practices and gather the data that will allow us to develop insights into the true value of individual tests. This same perverse incentive to order added tests is also driven by the lack of tort reform for our healthcare providers. When the fear of being sued drives our providers to order excessive tests and procedures it not only raises the overall healthcare and individual patient costs but often exposes the patient to added discomfort and danger. These types of changes have enjoyed bipartisan and bicameral support in the past and should be revisited.

We need to consider pricing drugs by the value they impart. We have been experimenting and, in some cases, implementing results-based pricing contracts that are based on the overall effectiveness of a medicine or procedure. There are ways to make informed estimates of the true overall value of a medicine. A medicine that saves lives, restores the ability of the patient to be self-sufficient or allows a patient not to be institutionalized all have a huge impact on healthcare and societal costs. We need to pursue these types of value-based solutions.

The value and effectiveness of preventative programs have been widely recognized but paying for these types of programs have been difficult to implement given the current short-term focus on cost. This bias was evident in my experience at the American Society on Aging conference I attended two weeks ago. There was real resistance to the idea of expanding Medicare Advantage (MA) programs that have the benefit of offering wellness programs to help us stay healthy rather than treat us after we get sick. MA plans are an example of the type of incentives we need to adopt in America’s healthcare system. The MA program saves money in the long run by keeping us healthy and out of the doctor’s office and out of the hospital. This allows the cost of a medicine or procedure to be offset by the savings generated by the avoidance of a stay in the hospital. Our siloed Medicare system (divided into Parts A,B, C, and D) prevents this type of accounting. For example, when Medicare Part D was first implemented hospital admittance by seniors fell. There was no way then or now for the savings generated by these lower hospital admissions to be credited to Part D. This lack of accounting is even less accurate in estimating the social affect of a patient who, through the efficiency of a provider or a new medicine, is able to return to work, support themselves and pay taxes rather than consume government funds. We need to find out how to develop systems that look to the long term and take a broader look at keeping seniors healthy.

These are some pretty lofty goals and may seem unreachable. I often find myself looking only at the next piece of legislation or the next executive order or the next regulatory change and fail to step back and look at the direction we should be headed to really fix America’s healthcare system. I think the suggestions detailed above should be touchstones to which we compare each proposed change, asking the question, does this get us closer to the above descriptions or take us further away? We can’t get closer to these long-term solutions if our next piece of legislation or executive order or regulation takes us further away.

As always, I’ll keep my eye on any healthcare legislation that pops up and keep you informed, but rest assured that I won’t just be interested in the short-term savings or impacts, I’ll also be looking at the long-term implications of each proposal.

Best, Thair



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Report From the American Society of Aging Conference

Every year the American Society on Aging (ASA) has held a conference that brings together a specific group of healthcare providers for older Americans. The attendees are primarily providers of home care, assisted living facilities, long term care, etc. Many nonprofits and providers of services covered under the Older Americans Act also attend. It is a huge conference, one that I have attended many times in the past. It is held each year in New Orleans, and this was its first non-virtual, in person conference held since the start of the pandemic. I took the opportunity to attend this year to stay updated on what the future holds for older Americans.

This conference offers workshops and training that are valuable to those in this sector of healthcare. They offer different tracks of classes and panels that represent different facets of healthcare. One of these tracks focuses on public policy and legislation and regulations that will affect the attendee’s organizations. As you might guess this is the conference track that I chose to attend. ASA is a large and powerful organization, and, since most of their funding comes from Medicare, Medicaid or other government funded programs, they are very interested in proposed changes to these programs. As I listened to the presentations, I found some general themes that concerned me as I considered the long-term impact on our healthcare.

Everyone was extremely disappointed in the failure of the Build Back Better (BBB) Act that was to be President Biden’s signature piece of legislation. I certainly understood their disappointment. There were many pieces of that legislation that would have increased government funding for their organizations. There wasn’t much concern with the trillions of dollars that the government had already spent on COVID-19 related expenditures and how much the BBB Act would add to this huge debt. This huge debt was the main concern for those Senators and Representatives who chose not to support BBB. There were certainly weaknesses in our healthcare that were exposed by COVID-19 that need to be fixed. Issues like increasing the use of telehealth, ways to serve those in rural areas, and one of the most discussed issues at the conference, how to develop equity in our healthcare services. There weren’t many discussions, however, on how to get these solutions implemented.    

The opening keynote speaker, Raymond Jetson, an inspirational speaker who has pioneered programs that use local assets to improve the lives of older people in different communities, made an interesting observation about some nonprofits and institutions that were created to serve seniors. He said that sometimes the people running the organization became more enamored with the container, the organization itself, rather than the people within the container . . . older Americans, the people the organization was created to serve. I think that this description details much of what has caused problems within Medicare and Medicaid, and government organizations in general. They get wrapped up in self-preservation and layers of regulations rather than focusing on the people they should be serving and their changing needs. Often, a government institution’s reaction to problems is the addition of more regulations and more oversight, which was part of the problem in the first place. An example of this situation was revealed in two panels I attended later in the conference.

The first panel centered around what advocates need to know about what’s happening in Washington, D.C. After bemoaning the failure of the BBB Act one of the panelists ventured off into a discussion about the administration’s failure to rein in Medicare Advantage (MA) programs. He pointed out that last year the government had paid $15 billion in extra payments to the insurance companies that had taken on the total responsibilities for treating the seniors who had opted for a MA program which offers many more benefits than basic Medicare. He even said that the administration was encouraging the privatization of Medicare and it seemed everyone in the room agreed with this inaccurate description. Later in the panel discussion, as a solution to stop the privatization of Medicare, a panelist opined that rather than Medicare for all we should push a single payer system to the state level and have Medicaid for all, to which there seemed to be widespread agreement. It seemed the room’s solution to any problems with Medicare was an increase in government control.

The next day there was a panel discussion of what the first year of President Biden had accomplished as it relates to seniors. The same panelist who disparaged the increase of seniors that have opted for Medicare Advantage again discussed his displeasure with this alarming trend. I couldn’t hold back any longer . . . I pointed out to the panel that the cost in the BBB Act for adding benefits like those offered by MA were going to cost about $40 billion a year and that was mostly just for the dental benefit. I asked if that didn’t seem like a pretty good deal, the $15 billion payment mentioned yesterday instead of $40 billion for less benefits in the BBB Act. There was a sudden diversion into a discussion of other higher estimates for MA payments. I then asked what they thought was the reason for the percentage of seniors joining MA plans going from 30% just a few years ago to almost 50% now. They said that one reason was the intense marketing (Joe Namath’s name was bantered about). I asked if they thought this large number of seniors would pick a plan that wasn’t best for them because of a Joe Namath commercial? Much discussion ensued. It always gets my dander up when people insinuate that seniors aren’t capable of making informed decisions about their healthcare.

There were many devoted people at this conference who were interested in learning how to better care for the seniors in our country. There was, however, a disturbing trend on the public policy side that revealed many who were more interested in building up the container than doing the things that would benefit the people the container serves, older Americans.

It was great to, once again, see and talk with people face to face. I listened and learned (except when I was moved to speak out) and I feel like I have a better reading of the pulse of healthcare policy going forward. I will continue to speak out about issues that affect the health of America’s seniors.

Best, Thair  



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Medicare Check In and Check Up

Thank goodness, the avalanche of ads and emails and stuffed mailboxes with pleas to sign up with their Medicare plan is a distant memory. Whatever plan you chose is what you are experiencing right now and it’s important to take a moment to reflect on how you feel about the choice you made.

In our recent survey we asked you if you felt your Medicare prescription drug plan made drugs more affordable and accessible. Almost half, 49.3% said no. This is a long way from the almost 90% that, year after year, have said they were satisfied with their plan. What changed?  I’m convinced that it’s the barrage of rhetoric that is blasting out of Washington that is convincing people that their once valued prescription drug plan is somehow now not working. We need to step back and decide for ourselves what’s best for us.

I think now is a good time to evaluate where you stand with both your prescription drug plan and your Medicare supplemental plan, if you have one, or Medicare Advantage if you have chosen that option. Are the services recommended by your doctor available when you need them? Do you and your doctor have the ability to initially choose the prescription medicine that fits your specific condition and then to change as your needs dictate? How are your co-pays and co-insurance? Has your out-of-pocket expenses increased? It is sometimes difficult to make comparisons year over year when your health may have changed. If your health required more doctor visits, more tests or even some time spent in the hospital, your out-of-pocket expenses are obviously going to change. The real question is whether the plan you have is the best for your particular situation and, maybe just as important, will the changes proposed by the current administration improve accessibility and affordability?

Now is a good time to take some time and write down what works for you and what doesn’t with your insurance. Some of that introspection is an honest evolution of where your current health is headed. Are there inherited family vulnerabilities that should be taken into account? My wife’s grandmother, mother, and aunts, on average, lived to be over 100 years old. My father died when he was 66. Maybe there are some things I need to consider going forward. Family longevity is only one thing to consider. Science has given us tools that can look at our DNA and uncover threats to our health that should influence our plans for staying healthy as well as the insurance plan we choose. We should not only look at how our plan works for us when we get sick but also how it helps us stay healthy. For instance, when I lived in Virginia, I joined a gym that included a pool where I could swim laps. I paid for the membership, and it helped me stay healthy. When I moved out West, I found that my new Medicare Advantage plan included the benefit of a free membership to a local swimming pool. My insurance carrier reminds me (some people call it bugging them, but I choose reminding me) about things I should be doing to stay healthy. At my last physical my doctor said it was time to get another colonoscopy. A colonoscopy is not one of the fun things I’ve done in my life, but it is definitely for my own good. Well, because of a myriad of not really good reasons, I haven’t scheduled the procedure. This last month I’ve been getting emails from my Medicare Advantage provider reminding that it I should be getting a colonoscopy. I’ve set a deadline that I’ll get it done by the end of May. Remember, the reminder is from an organization that is going to pay for this procedure. They do that because it’s to both of our benefits to discover possible colon problems early.

So, here’s the bottom line, statistically less than 40% of seniors even review their insurance coverage during the open enrollment period and 10% or less change their coverage. Does that mean that 90% have had no change in our circumstances over the last year and we’re happy with our current coverage? It would seem logical that one of these four things will probably happen during this year:

  1. Our health status changed.
  2. Our current plan changed in some manner.
  3. Competing plans that changed benefits might be of interest to us.
  4. There were new plans offered in our area.

There are some things we can do now to be ready for the next open season:

  1. Keep a diary of things you like and dislike about your current plan, both your prescription drug plan and supplemental or Medicare Advantage plan, as applicable.
  2. Track how much you spend on your healthcare – be sure to include what you spend on preventative care.
  3. Find out and document family health history. It will not only help you choose a plan but is something you need to bring up with your doctor.
  4. Evaluate your own health and your health trajectory.

Hopefully, doing these things will give you the information you need to make an informed decision about your insurance. No one else is responsible for your health. If we don’t take the time to select the right plan for ourselves then insurance companies won’t be incentivized to compete for our services. We need to keep the competition alive so the government doesn’t seize the opportunity to regulate and dictate our healthcare.

Best, Thair



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National Public Health Week

Every month I’ve focused on at least one healthcare-based day/week/month. It was usually linked to a disease, like National Cancer Prevention month or Bone and Joint week. These yearly observances are important because they help us pay attention to information that may help us either avoid a disease, better manage our health when we have the disease, or give us hints on how we can be better caregivers to a loved one that has the disease. I’ve always learned something as I did research for this blog, and I’ve changed some of my habits because of the things I’ve learned. Well . . . this week we take a broader look at how our health can be impacted when we celebrate National Public Health Week.

This observance is a project of the American Public Health Association (APHA) and the theme this year is “Public Health is Where You Are”. Much of the APHA’s efforts center on access and they realize that where you live affects your community’s health. There are ways that we can make our communities healthier, stronger and safer. One way is to realize there may be barriers that keep some people in our communities from accessing the care they need as they face different health challenges. The National Public Health Week has identified daily themes for the week, they are:

Racism: A Public Health Crisis (Monday)

Public Health Workforce: Essential to our Future (Tuesday)

Community: Collaboration and Resilience (Wednesday)

World Health Day: Health is a Human Right (Thursday)

Accessibility: Closing the Health Equity Gap (Friday)

Climate Change: Taking Action for Equity (Saturday)

Mental Wellness: Redefining the Meaning of Health (Sunday)

Clicking on the title can help you find out more about each one of the themes. Reading through the different themes helped me understand how important each of these themes affect our communities and how are our own health can be affected.

As you might know from my earlier blogs, I always try to find some way that each of us can make a difference. Most of us get our healthcare close to where we live, in our communities. We may have faced one or more of the barriers mentioned above as we work to access our own healthcare providers. I’d like to talk about three ways you can personally become involved in helping your friends and family and improve the healthcare access in your community.

Transportation – I would guess that all of us have encountered problems with getting to the doctor or some other healthcare providers for a scheduled appointment or know of someone who couldn’t get to the pharmacist to pick up a prescription. There are many local organizations that are looking for volunteers to help with anything from rides to the doctor to being a visitor to people who are homebound. Get involved, find a way you can help remove the transportation barrier in your community.

Access to available programs – There are many federal, state, and local programs available to help seniors gain access to needed healthcare services.  A resource that you can use and share with your family and neighbors is found by clicking here. This is the U.S. Administration on Aging web site, and it will help connect you to the state and local services that are available to older Americans in your communities.

Older Americans Act – The Older Americans Act (OAA) funds critical services that keep our nation’s seniors healthy and independent—services like meals, job training, senior centers, health promotion, benefits enrollment, caregiver support, transportation, and more. It’s reauthorization is being debated right now in Congress and must be renewed before it expires. There are proposals that would cut some of the funding for this important program that has been helping seniors since 1965. I would urge you to contact your Washington representatives and tell them you want to make sure the Older Americans Act gets funded without cuts to these life supporting programs.

Our community is where we receive our healthcare. We all need to recognize that many of us have barriers that inhibit our ability to obtain needed care. We need to become involved in helping those in our community overcome those barriers and obtain access to the life changing and lifesaving miracles of medicines and care that are available.

Best, Thair



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Speaker Newt Gingrich, “price controls equal health controls”

Last Thursday, March 24th, we held the first Facebook Live coffee chat. It was the culmination of our March emphasis on one specific drug pricing proposal . . . the government proposal to set drug prices. My blogs this month have been centered around this proposal and we released a survey on the subject, giving you the opportunity to speak out and give us your input on what is important to you. We had a very important guest at our coffee chat, former Speaker of the House Newt Gingrich. We discussed this drug pricing approach and the results of our survey. I will offer a brief summary of the event below but you can see the entire Facebook live event by clicking here.

I opened the chat explaining this proposed “solution” which has been around for some time but was given added emphasis when President Biden referenced it in his State of the Union address earlier in the month. I pointed out that the only way to accomplish this price fixing was to limit the formulary, the number of prescription drugs available in Medicare. This approach would also limit the discovery of new drugs for the treatment of serious diseases like cancer, Alzheimer’s, and diabetes. I went on to explain that just as medicine is moving rapidly toward personalized treatments the government’s approach of price controls would pull us back to the one size fits all era of cookie cutter medicine, leading to treatment, abandonment, and worse health outcomes.

I then introduced Speaker Gingrich. He was Speaker of the House from 1995 to 1998 and has stayed involved with public policy in a variety of ways since that time.

Speaker Gingrich started out by reminding us of all the amazing discoveries that have been made in Medicine in the last 5 to 10 years. People he knows personally are still alive today because of those discoveries. He compared government controls to a snapshot that freezes drug discovery in time as opposed to a motion picture, changing every day. He said, “What I don’t want to see happen is the heavy hand of government bureaucracy come in, set artificially determined rules, cut off all of these new innovations, all of these new breakthroughs.” He described Great Britain where they have a government committee that determines which prescription drugs will be available to the citizens. He pointed out that people from other countries still come to United States when they have a serious health problem. He said, “I don’t want us to adopt a policy that leads us to mediocrity, and that deprives senior citizens of the kind of breakthroughs that are going to improve the quality of their life, enable them to live independently, enable them to remain healthy for 10 or 15, or 20 years longer, because of all the new science that’s coming down the road.”

At this point Speaker Gingrich said something that summed up the whole concept of government price controls, he said, “So it’s very important, when somebody tells you that they’re going to involve price controls, remember, they’re telling you they’re going to have health controls, because that price control is going to affect your health.” As this blogs title says, price controls equal health controls. This approach will let the government control your health.

I then asked Speaker Gingrich if he thought price control legislation would be enacted this year.

He said he didn’t think it would be passed this year. He was in Florida at a Republican retreat and said, “I know from talking to Ways and Means Committee members here, they’re deeply opposed to depriving the American people of the opportunity to have the best medicine in the world, and to have the best pharmaceutical industry in the world, which is capable worldwide, of offering better solutions and better health.” He reminded us to continue to be vigilant and tell those who govern us that we don’t want this government interference.

I then pointed out that some would tell us that seniors are OK with having a reduced number of drug discoveries and asked him if he thought that was accurate? He noted the difference between answering that in general and answering it from a personal perspective, about not having a lifesaving drug available for a loved one or for one’s self. He said, “So I don’t believe any survey, which suggests that people think it’s all right, to deprive them of a choice of the medicine that may make their life better, or that may actually save their life.”

I then asked him whether he had seen benefits since Medicare’s prescription drug program, Part D, was implemented. Speaker Gingrich replied that he was an ardent advocate of Part D and through his speeches and writings has said that providing healthcare was a moral issue and then a monetary issue. He reminded us that when Medicare was first implemented the number of prescription drugs available was very small and not considered important. He was proud when Part D was created and had seen the positive impact it had on older Americans. He recalled how Part D costs came in well below that government’s estimate of what it would cost. He also said, “Drugs are not a major driving force in the cost of healthcare. In fact, if anything, the price of drugs has risen in recent years slower than the price of the rest of healthcare.”

I then asked the question whether he thought it was a good idea to purchase drugs from another country? His answer was to point out that the FDA does not have a way of monitoring these drugs and there would be no guarantee as to the safety of these foreign drugs.

In my final question I asked Speaker Gingrich why he believes people in other countries sometimes pay less for their prescription medicines. He pointed out that a country, he used France as an example, would set a price they would pay for a particular drug and if the manufacturer wouldn’t pay it then they would revoke their patent and let a French company manufacturer it. He also pointed out that he has advocated for years that we should treat it as a trade issue and force other countries to share in the cost of drug innovation. He also stated that he thought there was some streamlining of the FDA that would lower the cost of innovation.

I then transitioned to a review of our Seniors Speak Out survey. Last week’s blog dealt with the survey in more detail and you’re welcome to click here to read that more detailed explanation.

Here are a few highlights:

  • Nearly 40% of respondents said they want our lawmakers to prioritize lowering healthcare costs, with 37% wanting lower drug costs, 16.5 percent of respondents wanting more access to federal healthcare programs like Medicare, Medicaid, and the VA to innovate drugs and treatments. Lastly, only 8% want to ensure that we have vaccines and treatments for future pandemics, like COVID-19, which I feel shows that seniors believes that the pandemic is over, and they’re not as concerned with being prepared for future ones. It was interesting that seniors recognized that overall healthcare costs was their top concern with drug costs being a close second.
  • 91% of respondents said they were concerned government cost controls would limit the number of medicines available to them. When seniors understand the results of proposed changes to their healthcare their true attitude is revealed.
  • 84% were concerned that price controls would devastate biopharmaceutical innovation and make it more difficult for patients to access advanced treatments for serious diseases.
  • The top two changes respondents indicated they would like to see are increased transparency in the current drug pricing supply chain and putting a cap on the yearly out-of-pocket prescription drug costs for Medicare beneficiaries.

In closing, Speaker Gingrich and I reiterated the importance of telling those who govern us that government-imposed price controls are not the answer. Tell them you understand that government price controls equal government health control and that’s not what you want.

It was a pleasure to participate in this important discussion and I look forward to continuing with more of these types of events.

Best, Thair



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Interesting Preliminary Drug Pricing Survey Results

Interesting Preliminary Drug Pricing Survey Results

We have the preliminary results from our Seniors Speak Out survey and the results are proving to be very interesting. Our survey focused on the recent drug pricing proposals that have been put forth by different politicians, mostly recently by President Biden in his State of the Union address. We thought it would be important for you to let your voice be heard. Our questions avoided some of the rhetoric that has accompanied the drug price discussion, identifying in the questions some of the consequences of the different proposals. The results were very interesting.

It is important to note that these are preliminary results – the final results will be in later this week. You still have a chance to participate in the survey before it closes. Click here to take the survey. You might want to take the survey before you continue reading this blog, so you won’t be “swayed” by the preliminary results. You should also know that I will be discussing the drug pricing topic with former Speaker of the House Newt Gingrich on Thursday, March 24th at 1:00 PM ET. You can tune into the event once it is live by clicking here. If you’re able to attend, mark yourself as “interested” in attending.

Question one.
What top two healthcare priority issues are you concerned with this year? 

Answers:

  • 16.7% – More access through federal healthcare programs (Medicare, Medicaid, VA) to innovative drugs and treatments.
  • 7.5% – Ensuring we have vaccines and treatments for future pandemics like COVID-19.
  • 37.5% – Lowering drug costs.
  • 38.3% – Lowering all healthcare costs

Analysis:
The first thing that caught my attention was the fact that we seem to be done with the pandemic; it was deemed least important. The top two choices, not surprisingly, dealt with cost. What was surprising was the number one choice, lowering all healthcare costs. With all the media and rhetoric focused on drug costs you still recognized that other aspects of our healthcare have had price increases and we should concentrate on all aspects of our healthcare costs.

Question two.
Government price controls could limit the number of drugs and treatments available to patients, taking away choice and flexibility in treatment plans. Does this concern you?

Answers:

  • 91% – Yes
  • 9% – No

Analysis:
Government price controls only work when access and choice are rationed. A good example of this limited accessibility is the government formulary for the Veterans Administration drug program, which has about half as many prescription drugs available as Medicare Part D.

Question three.
Government price controls could devastate biopharmaceutical innovation and make it more difficult for patients to access advanced treatments for serious conditions like Alzheimer’s, heart disease, and diabetes. Is this concerning to you?

Answers:

  • 83.6% – Yes
  • 16.4% – No

Analysis:
While we don’t know exactly how much innovation will be affected by government price controls, the Congressional Budget Office has indicated there would be some reduction in the number of new drug discoveries, with the small and limber biotechnology firms being impacted the most. You overwhelmingly thought that this negative impact on innovation was a bad idea.

Question four.
Below is a list of drug pricing policy proposals. Which proposal would you rank as your number one choice for proposals for lawmakers to pass:

Answers:

  • 10.4% -Allow drugs to be imported from other countries despite safety concerns
  • 35.8% – Caps on out-of-pocket drugs costs in Medicare Part D.
  • 13.4% – Allowing the government to set the price of drugs (some call it “government negotiation”).
  • 40.3% – Transparency within the drug pricing system.

Analysis:
I am so encouraged by your recognition that drug importation and government price fixing are not viable, long-term solutions to lowering your cost of prescription drugs. You also recognize that having a cap on our drug costs would give us the peace of mind that we won’t be bankrupted by the cost of our prescription drugs. Your number one selection reveals your understanding that any long-term solution needs pricing transparency, enabling the patients to share in the savings.

Question five.
Do you feel like your Medicare Advantage or Medicare Part D prescription drug plan makes prescription drugs more affordable and accessible?

Answers:

  • 50.7% – Yes
  • 49.3% – No

Analysis:
I’m somewhat confused by these results. Over the last 15 years, surveys on the satisfaction of Medicare Part D have been at or near a 90% satisfaction rate. I would like to find out why only half of you thought Part D made your drugs more affordable and accessible. This might be a subject for a future blog.

I appreciate your willingness to take the survey and tell us how you feel about these proposed drug price solutions. I am looking forward to talking with Speaker Gingrich this Thursday about these issues.

Again, you can take the survey by clicking here. You can join Speaker Gingrich and me on Thursday, March 24th at 1:00 PM ET. You can tune into the event once it is live by clicking here.

Best, Thair



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Innovation – A Life Improving and Life Saving Solution

(Take our survey and join our discussion with Newt Gingrich – see below)

Each month, one or more of my blogs would focus on a specific health issue or disease that was highlighted that month, like the American Heart Month that was the subject of my February 7th blog. March has five health observances (You can click “Link” to find more about each observance).

  • National Colorectal Cancer Awareness Month – Link
  • National Kidney Month – Link
  • National Nutrition Month® – Link  
  • National Women and Girls HIV/AIDS Awareness Day – Link  
  • World Tuberculosis Day – Link  

A part of each one of these observances encourages us to take advantage of the new medical discoveries available to us today. There are tests and procedures to help make early diagnosis. There are procedures that can alleviate or eliminate the problem. There are medicines that can lengthen or save our lives. In every instance some sort of innovation or discovery has made that medical problem less deadly or has improved the quality of life for those who are suffering. Even getting the most out of the food we eat has benefited from innovation. People with digestive problems and food absorption problems have more medical options that can help alleviate their problems.

The benefit of these innovations was revealed a little over 15 years ago when Medicare’s prescription drug program, Part D, was implemented. That year the number of elderly patients admitted to the hospital fell. The only plausible reason was the new accessibility to prescription drugs made possible by Medicare Part D. We often forget the broad impact that these new drugs have, not only on our quality of life, but also on the overall cost of our healthcare.

One of the problems with Medicare accounting is each of the parts is its own silo. Each of the Medicare Parts (Part A – provides inpatient/hospital coverage, Part B – provides outpatient/medical coverage, Part C – an alternate way to receive Medicare benefits, and, Part D – provides prescription drug coverage) has a closed accounting system, and is not financially connected to the other parts. None of the hospital admittance savings that were made possible by the implementation of Part D were credited to Part D. The true cost and savings of Part D were not recognized. This lack of broad recognition of the value of a new medical discovery, especially in prescription drugs, has hindered the move to a more equitable way to price these new innovations and discoveries.

The President, in his State of the Union address, once again brought up his desire to lower the cost of prescription drugs. To me this statement always begs the question, what is the true cost and who pays that cost? If we truly account for the broad savings of less hospital visits, the reduction in caregivers’ time, the economic impact of less lost days of work and less doctor visits, we might find that the cost of the drug is much less when the overall savings to our economy is recognized.

What will these proposed changes do to the prescription drug costs that we pay? The government’s nonpartisan accounting agency, the Congressional Budget Office (CBO), has said that some of the price cutting solutions proposed to lower drug costs would have negligible effect on the Medicare patient’s out-of-pocket costs. That doesn’t sound very reassuring to me that my costs are going to go down.

What worries me the most about these changes to Part D is the affect it will have on innovation. Politicians are quick to say that the “rich” drug companies will do just fine, that innovation will continue. The CBO has done some preliminary work and has concluded that there will be a reduction in the number of new medicines discovered if the proposed Part D changes are implemented. I think that any reduction is worrisome. If the drug that saves the life of my grandchild is not discovered because of these changes, I’m against the changes. We are at the cusp of life changing and life saving discoveries. The new COVID-19 vaccines are evidence of the impact of innovation. With all the progress in understanding the ways different cancers work, we now can dare to imagine a time when cancer is conquered. We are understanding how to repair DNA. Now is not the time to change the mechanism that has brought us to this dawn of discovery.

As our national leaders ponder these questions, we thought it was important to hear from you. We have created a survey that asks you how you feel about these issues. We encourage you take the survey and tell us how you feel. Click here to take the survey.

You also have the chance to tune into a Facebook live discussion concerning the survey results and the drug pricing question with former Speaker of the House, the Honorable Newt Gingrich and me. It will be held at 1:00 PM ET on Thursday, March 24th. You can tune into the event once it is live with the below link. If you’re able to attend, mark yourself as “interested” in attending.

https://fb.me/e/1x0psWUNA

I hope you take the time to take the survey and then to join us as we discuss this important issue.

Best, Thair



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Prescription Drug Price Controls Won’t Make the State of our Union, Or Your Healthcare, Stronger

President Biden declared in last week’s State of the Union speech that he was going to lower prescription drug prices. It has become a mantra echoed over the years by Democrats and Republicans alike. It is important to note that each of the approaches that have been proposed for lowering drug prices involves inserting the government into the Part D Prescription drug program. If you haven’t already deduced from my earlier blogs, you need to know that I’m an ardent fan of keeping the government out of our lives and especially out of our healthcare. Having said that, I also recognize that the free market has its limitations when it comes to healthcare. For instance, if I didn’t like the heart transplant I got last week I can’t just go to a different doctor or hospital for this week’s heart transplant. Some aspects of the free market don’t work when it comes to healthcare. There are places where government oversight is needed to set guardrails and to ensure the safety and accessibility of our healthcare. The very inception of Medicare Part D is a great example of this balance of the free market and government oversight.

If you turned 65 less than 15 years ago you may not realize that Part D was not always a part of Medicare. When Medicare was first implemented, the number of prescription drugs available was very small compared to those available today. It wasn’t considered necessary in 1965. By 2003, it was evident that prescription drugs were an important part of our healthcare and it needed to become part of our Medicare benefit. The debate over how this new benefit would be administered ranged from those who wanted to have a government run program, they even estimated what a government-controlled Part D approach would cost, to those who wanted the government to issue vouchers to beneficiaries that could be used to purchase prescription drug coverage from commercial insurers. It quickly became evident that neither of these approaches had the votes to pass so the search for a compromise approach began.

The side that wanted more government control of the process worried that there wouldn’t be enough insurers offering plans, especially in rural areas. Their solution was to create more regulations that would force levels of insurer participation and to propose a fallback approach that, if no plans were offered in a particular area, a government-based Medicare plan would be offered.

The side that wanted less government intervention pushed for the ability for private insurers to contract with Medicare to offer prescription drug plans in specific areas and compete with other commercial plans for customers. To ensure free competition, an explicit non-interference cause was to be included in the law, prohibiting the government from influencing or directing drug prices, letting the competition drive the premium prices.

After much discussion, the Part D program we have now was narrowly passed at 3:30 am. It took over 2 years to prepare for the benefit roll out, with Part D being fully implemented in 2006. The resulting law was a public/private partnership that included the non-interference clause and the provision to offer a Medicare sponsored plan if no commercial insurance plan was offered in an area. This is what has happened over the last 15 plus years.

  • Montana, a very rural state, has 23 Part D plans to choose from; it was never necessary to implement the Medicare based plans.
  • Premiums have grown slower than the consumer price index.
  • Part D costs are 40% less than what was estimated for a government-controlled solution.

The point I want to make is that, in this particular area of healthcare, keeping the non-interference clause in the law worked.

There have been many drug price solutions proposed:

  • Drug negotiations – This would allow the government to essentially set drug prices.
  • Drug importation – Allow states to import drugs from foreign countries, primarily through Canada.
  • Limit drug prices – Base drug prices on those of a select group of foreign countries.
  • Limit existing drug price increases – Using the Consumer Price Index (an inflation indicator) the government will limit the amount certain drug prices could be increased.
  • Change the prescription drug rebate process – Push rebate savings to the patient at the pharmacy counter.
  • Change Part D to operate like the VA drug program functions – It would mimic the government-run VA drug program which has about half of Part D’s formulary and sets price discounts.

Every one of the proposed “fixes” to drug prices involved government intervention with none of these solutions having any history of working. We have 15 years of history of proof that non-interference works. The Part D program has an almost 90% favorable rating among its users. We don’t know need to revert to an untested government-controlled prescription drug program.

Do we need to improve the Part D program? Yes! The business model and pricing mechanism is convoluted and inefficient. We need ways to reduce and/or cap the out-of-pocket prescription drug costs. There are solutions that can lower your prescription drug costs while continuing to encourage the discovery of life changing and life savings drugs. We need to all get together and work toward these solutions. Government setting the price of prescription drugs is not the solution.

This month Seniors Speak Out is focused on discussing drug prices. Our first step is to hear from you. We’d ask that you to click here and take a brief survey so you can tell us what your concerns are. You can then tune in on Facebook live, on March 24th, where former Speaker of the U.S. House of Representatives Newt Gingrich and I will discuss the survey results and drug pricing. We’ll give details on how to tune in to the Facebook live discussion on my blogs later this month.

We look forward to hearing your thoughts.

Best, Thair