The EpiPen Scandal: Don’t Mess with Parents! 

EpiPenBy Jill Zorn

If it wasn’t for a grassroots movement of furious parents, we may never have heard about the EpiPen price gouging scandal.

When parents of children with severe allergies started going to pharmacies in July to purchase their annual supply of EpiPens for the upcoming school year, they couldn’t believe how much the price had increased.  They got mad and they decided after years of price increases and growing insurance co-pays and deductibles, they weren’t going to take it anymore.

They took to social media with a vengeance.  Facebook posts, photos of pharmacy receipts and petitions to congress flooded the internet. Read one Connecticut mom’s CT Mirror post here.

This week, several U.S. Senators, including Connecticut’s own Richard Blumenthal, and the mainstream media heard them loud and clear.  The story exploded, engulfing Mylan, the corporation that makes and markets EpiPens.

Yesterday, the CEO of Mylan, Heather Bresch, was trying to do damage control, as outrage from the public kept pouring in.  She had her talking points ready – see the company’s press release, here.

  • Look, we’re great!  We hear you!  We’ll give you a coupon so you can maybe afford this $600 medication
  • It’s not us, it’s the pharmacy benefits managers, insurance companies, wholesalers and pharmacies that are all taking their cut
  • It’s not us, it’s “the broken system”

But when push came to shove and she was asked in a TV interview why Mylan doesn’t just cut the EpiPen price, her response was, “I’m running a business”.  Exactly.

When corporate greed gets in the way of access to life-saving medicine, it’s pretty clear that Mylan’s CEO is right, our health care system IS “broken”.  But what this scandal shows, is that Big Pharma, with their Big Profits, is at the heart of that broken system.

Go here to read yesterday’s EpiPen Scandal blog.

 

 

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#EpiGate: The EpiPen Scandal

By Jill Zorn

Stealing money from the pocket of his jeans

People are “shocked, shocked!” once again that pharmaceutical corporations are ripping off the American people.

This time, the story is about Mylan, the company that sells the EpiPen.  The EpiPen is an easy-to-use injection device purchased by people with severe allergies to have on hand in case they have an extreme allergic reaction.  The epinephrine in the device only stays effective for one year, so every year, a new EpiPen (actually they are only sold in packages of two!) must be bought.

Having an EpiPen available is not optional – it is literally a life-saver.  And currently there are no other easy-to-use alternatives to the EpiPen on the market.

So, what has Mylan done, with its EpiPen monopoly?  It has raised the price of this crucial medication 400% since it purchased the product in 2007.

Even with insurance, people with serious allergies that have coverage with high deductibles and co-pays are really feeling the pinch.  And all of us end up paying again when insurers raise their premiums due to high medication prices.

Here at the Universal Health Care Foundation, we call out profiteers like Mylan on a regular basis. Corporate greed of this magnitude is one of the reasons health care costs are growing much faster than wages, making it harder for people to afford access to the quality coverage and care we all need and deserve.

Without strong consumer protections and government oversight, drug company monopolies, insurance company monopolies and hospital system monopolies are all bad for our physical AND financial health.

But this particular story hits close to home.  That is because one of our staff members carries an EpiPen.  I have made sure I know where she keeps it, in case she has a dangerous allergic reaction while she is at work.  She has a $50 co-pay when she replaces her EpiPen, which she must do annually.  And the inflated cost of the prescription is one of the many reasons that our organizations’ small group insurance premiums will likely increase in 2017.

So I’m happy to report that, with their reputation plummeting almost as much as their stock price, Mylan announced today that they at least will improve their assistance programs to help people with their co-pays and deductibles.

That could certainly help our staff member by giving her some relief from the cost of the co-pay for her EpiPen.  But will it help our insurance rates?  Probably not, because Mylan is not dropping the list price.  That means the cost of the drug to our insurance company is not likely to change, since whatever discount they may have negotiated with Mylan, is based on a percentage of the list price.

In fact, drug companies right now are generally rewarded for hiking their prices, as price increases generally lead to higher profit margins.  In fact, while the health industry overall is quite profitable, major drug companies are the most profitable, with average profit margins of 21 percent.

With Medicare unable to negotiate drug prices by law, and individual insurance companies lacking the clout to gain sufficient negotiating power, often the “sky is the limit” for setting drug prices in the United States.  Drug companies raise prices because they CAN.

So, these “shocking” pharmaceutical corporation scandals will continue to come our way.  A few months ago it was Martin Shkreli of Turing Pharmaceuticals, then Valeant Pharmaceuticals and now this week it is Mylan.  But until we have the political will to make big changes to how we regulate medication prices in the United States, Big Pharma is going to continue to do the “rational” thing:  enrich their executives and their stockholders at the expense of the American people.

 


To learn more

Here are a few articles that look at our drug price conundrum through the lens of the EpiPen debacle:

The EpiPen, A Case Study in Health System Dysfunction

Mylan Raised EpiPen’s Price Before the Expected Arrival of a Generic

EpiPen’s 400 Percent Price Hike Tells us a lot About What’s Wrong with American Health Care

Mylan Price Hikes on Many Other Drugs Eclipsed EpiPen Increases

Here are several explainers about high drug prices and the challenges we face to bring them under control:

Government Protected ‘Monopolies’ Drive Drug Prices Higher

Drug Prices Keep Rising Despite Efforts to Reduce Out-Of-Pocket Costs

The Complex Math Behind Spiraling Prescription Drug Prices

 

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Affordability in the Changing Health Care Landscape

By Angela deMello

 

Meet Angie2“When rates go so high that customers simply   decide they can no longer afford the product and leave the market altogether, then it is a market failure…”

Angela deMello, Connecticut small business owner, testified at the August 3 public hearing opposing Anthem’s request for a 2017 health insurance rate increase.

She wanted to share her perspective as a hands-on insurance broker about the impact of increasing costs on the people she deals with day-to-day.

The following are abridged excerpts from Angela’s written testimony.

 

Affordability in the changing health care landscape

Our Agency, The Strategies Group, handles health insurance for individuals, small and large employers, as well as Medicare recipients.  We have been in the industry for 25+ years and have experienced many changes and challenges to our healthcare landscape in CT. 

The Affordable Care Act (ACA) has definitely brought many positive changes, the biggest of which, in my opinion, has been the elimination of pre-existing conditions as barriers to insurance.  It has also been heartwarming that so many of my clients and their families have been able to see doctors for the first time in many years, or ever.  Subsidies (Advanced Premium Tax Credits) have made that possible. 

However, the majority of my clients have not experienced this opportunity.  According to the ACA guidelines, they make too much money to get subsidies. And most of them are now paying much higher premiums than they were before. While the aim of the ACA was to make insurance more accessible, coverage is now definitely NOT affordable to the average consumer. 

Individuals and small businesses respond to higher costs

Many of our individual and small business clients are paying the penalty for going without coverage rather than pay rising insurance premiums.  Their rationale is simple – do we pay insurance premiums or put food on our tables, or pay the mortgage? For many small businesses, it is a choice between paying insurance premiums or paying payroll. 

The plan to pay the penalty may be a challenge, however, I do not perceive that to be the main challenge. The bigger, more insidious challenge is that, without insurance, hospitals and providers are, by law, able to collect the full cost for services provided.  There is no “middle man” insurance company that can negotiate claims.

Market success or bust?

I understand that the definition of “affordable” is based in actuarial projections of the solvency of the insurance carriers, rather than the affordability to the consumer.  While that may be the letter of the law, I am appealing to you, the Insurance Department, to take into consideration, the spirit and intent of the law. 

I have always understood it to be the Insurance Department’s job to encourage, manage, and regulate a competitive insurance market in the state.  That is where the actuarial metrics of excessive, inadequate, and discriminatory come from – which is intended to keep insurance companies solvent, reasonably profitable, and to not overcharge certain segments of the state’s population unfairly while undercharging others. 

When rates go so high that customers simply decide they can no longer afford the product and leave the market altogether, then it is a market failure — one that government intervention and regulation is meant to prevent.  Sadly, this is what we are seeing on the horizon for 2017, with these enormous rate increases, and with the shutting down of Healthy CT (the state’s only nonprofit insurance co-op), making the market less competitive and the costs prohibitive for many people to participate at all. 

As such, Connecticut Insurance Department does need to take affordability into account as it looks forward, lest it have an even broader market failure to try to correct in a year from now.

I realize that you as the Insurance Department, probably field the same challenges.  However, laws were made by people like you and I, sitting across a table from one another, and making decisions that would improve the lives of our communities and fellow beings.

Are you a small business owner in Connecticut? Do you have a story like Angela’s?

Are you willing to share your story about rising health care costs?

We want to hear your health care story!

Contact Stephanye at info@universalhealthct.org today!

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Bribery or Blackmail? Aetna Takes its Toys and Goes Home

By Jill Zorn

business_people_fighting_over_some_us_money1.jpgYesterday, the Huffington Post published a scoop on why insurance giant Aetna may have chosen to pull out of almost all of the Affordable Care Act (ACA) health insurance marketplaces where they currently compete.

Reporters Jonathan Cohn and Jeffrey Young obtained a letter written by Aetna in response to a Freedom of Information Act request, answering questions posed by the Department of Justice (DOJ) as they continued their anti-trust investigation into Aetna’s proposed merger with Humana.  DOJ wanted to know if Aetna might alter their plans to compete in the exchanges, should their merger plans be rejected by the Department.

Here is an excerpt from Aetna’s response to that question:

“[I]f the deal were challenged and/or blocked we would need to take immediate actions to mitigate public exchange and ACA small group losses. Specifically, if the DOJ sues to enjoin the transaction, we will immediately take action to reduce our 2017 exchange footprint …. By contrast, if the deal proceeds without the diverted time and energy associated with litigation, we would explore how to devote a portion of the additional synergies … to supporting even more public exchange coverage over the next few years.”

If DOJ played nice and decided not to contest the merger, Aetna would continue to be a constructive partner, perhaps even expanding their participation.  But if DOJ played hardball, then Aetna would play hardball, too, and take their toys and go home.000682-0001-001856.jpg

As Vox’s Ezra Klein stated in his on-line discussion with Sarah Kliff, this response can be viewed in two ways:  “ One is that Aetna would have liked to stay in but needed to make good on their threat. The other is they wanted to leave but could have been kept in by the lure of the merger.”

Or, to put it more crudely, was this blackmail or bribery or both?

Before the Huffington Post investigative piece dropped, health wonks, financial analysts and journalists had been analyzing Aetna’s decision to pull out of all but four marketplaces.  What did this decision mean about the overall health of the ACA marketplaces?  All kinds of contradictory information was out there:

The reality is, in some states and regions within states, the marketplaces and the insurers that compete in them are doing well.  In other states, there is far from robust competition.

Like any huge undertaking, the ACA is far from perfect but it is way too early to declare it a failed program.

Certainly, if attempts to make needed improvements are dependent on Congressional agreement, making needed adjustments could be extremely challenging.

But an even more fundamental problem with the exchanges may be the fact that for-profit insurers, answerable to shareholders first and foremost, do not make for reliable partners when it comes to guaranteeing a public good like health care for all Americans.

As Ezra Klein stated in the earlier cited Vox on-line discussion,

“ basing your system around managed competition between private insurers means you are in bed with private insurers — dependent on their cooperation, and so incentivized to help them succeed.”

Or as Wendell Potter put it recently, “It’s way past time for us to stop deluding ourselves about private health insurers.”

Public option anyone?????

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Foundation Provides Comment at August CON Task Force Meeting

By Rosana Garcia

Cutout paper people

Universal Health Care Foundation provided public comment at the Certificate of Need (CON) Task Force meeting on August 15, reminding the group that their decisions will have a very real impact on the people of the state.

On this hot August day, the Governor-appointed group was meeting to discuss how to change the state’s CON law and regulations.

The CON program has the power to determine such major changes as whether new health services and facilities can be offered in your community, if the ownership of existing facilities can change or whether a service can be closed.  Changes to the CON process will impact the hospitals you go to, the doctors you see and where and how you get care in the future.

Here are some highlights from our public comment:

  • The CON program’s role in preserving competition and planning a high-quality, accessible and affordable health system in the state is critical. Fulfilling that role has been challenging for the Office of Health Care Access (OHCA), the agency responsible for the CON program, given a rapidly shifting health care landscape and the agency’s lack of resources.
  • The health care landscape in Connecticut has changed drastically, with in-state health systems growing larger, and out of state companies coming in to grow their multi-state organizations.
  • These mergers and takeovers are occurring without sufficient consideration of their impact on the communities they serve. Public engagement in the CON process has been “pretty woeful,” unless an independent entity or interest recruits members of the public to attend and provide their comments at public hearings.
  • The CON review process should actively seek public feedback on how the pending deals or changes may impact the community.
  • CON decisions should require long term monitoring and enforcement of conditions on deals to protect the public; right now, ownership changes are only monitored for three years.
  • A lot more has to be done within the CON program to put teeth into deal conditions, and to ensure local input and local voice in deals.

What it comes down to is that serving the public good MUST be the bottom line for Connecticut’s CON program.  CON Task Force members have a challenge in front of them – to change Connecticut’s CON program into one that truly does preserve competition for the consumer, while still improving access to and quality of care, and keeping costs down so that everyone can get the health care they need, at a price they can afford.

Quick Links:

CON Task Force Page

Our Previous Coverage:

Governor’s Certificate of Need (CON) Task Force July Meeting Highlights (July 19, 2016)

Malloy’s CON Task Force – What About Community and Consumers? (May 18, 2016)

Malloy’s Certificate of Need Task Force Starts It’s Work (April 13, 2016)

Malloy Steps Into “Wild West” of Hospital Deals (March 9, 2016)

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We Get What We Pay For With Health Care News

This opinion is offered by Adam Chiara, communications associate at Universal Health Care Foundation of Connecticut.


 p166886_l.jpgWhen newsrooms shrink it doesn’t just limit your access to important information, it is also hurting your health.

Okay, I admit I have no study to support that claim directly. There is, however, a rationale for it.

Before I begin, let me also quickly strike down any notion that this is just another bash on “the media.” If anything, they are the victims in many ways, and one of the true sources of the problem may just surprise you.

What’s Happening in Newsrooms

Newsroom budgets are being cut, and those cuts force tough decisions about what is covered.

Less staff means one reporter may now have the workload of three journalists. This means some stories are just not going to be told and others will not be told well.

Unfortunately, it is often health care stories that go underreported.

Too Few Beat Reporters

Beat reporters are important to the ecosystem of journalism and to quality reporting. Think of them as in-house experts on a subject or geographic location. These reporters exclusively cover their area expertise. It could be they report on all stories that revolve around politics, a specific town, or a subject like health care.

Beat reporters need to master their topic’s subject matter, and this leads to more comprehensive coverage and stories. Without having background knowledge on a subject, a reporter must approach a story from scratch every time.

Here’s an analogy to clarify the current state many journalists now find themselves in with the loss of beat reporters. Pretend your child asks you for help on their math homework. Sure, you know Algebra (kind of), but you might need a refresher yourself before you can walk them through it.

Now, let’s say you’re given a deadline. You have just 30 minutes total to explain it to your kid. Well, if you need 20 minutes to relearn Algebra yourself, do you think you will be doing a service to your child by rushing a shaky explanation in 10 minutes?

That, in a nutshell, is what is happening to reporters with assignments like health care. A reporter now is often just assigned the story for the day and has to learn the complexities of health care and the actual story itself in just a few hours.

With this method, it’s no wonder your child is a C student in Algebra, and too many of us flunk our own Health Care 101

Health Care Lost in Translation

Health care is going through a major tectonic shift. There are issues at play like insurance companies and hospitals merging and consolidating – which is creating monopolies. Access to health care is improving, but affordability, even for middleclass families, is worsening.  Lack of transparency is creating higher costs for services and poorer accountability in care.

Yet, most Americans probably could not articulate any of these problems. Without quality, consistent reporting on these issues, mediocre stories on these daunting challenges just get buried in a sea of other so-so articles.

Connecticut Media

While big cuts in health care have occurred in newsrooms like the Hartford Courant and the local TV stations, some of the slack has been picked up by other, smaller outlets.

For example, sites like the CTMirror have a reporter who just covers health care. Another site called C-HIT is an outlet that solely reports on health care stories in the state. Still, media organizations like these have a smaller reach in comparison to the hits the established media in the state receives.

It should also not be overlooked that just because there are a few outlets dedicated to health reporting, it’s a one step forward after three steps backwards scenario. And the scary thing is, if outlets like these go bust, the established media is not going to fill that void that they already left.

Don’t Just Blame the Media

While it may seem like this post is meant to wag the finger at the media, it’s actually the opposite. I think we, as media consumers, have to be much more conscious in driving the coverage we want.

The media is just another player in our capitalistic economy. It has to make money to survive. With the internet giving us the mindset that stories are “free,” the loss of subscriptions has drained outlets to their bare bones.

Here are some questions for you – what newspapers are you subscribed to? How much have you donated to non-profit and independent news sites?  When is the last time you have written to a newspaper asking for more coverage of a topic?

There is a saying, “We vote with our wallets.” Yes, the public has grown accustomed to free news, but is free always better?

There’s another saying that is very relevant to this predicament, “You get what you pay for.”

Until we reward the media outlets providing the kind of quality-coverage we want, and we take proactive steps to demand a higher standard of the media, the public is only going to receive the information that the media can afford to give us.

In other words, a small investment in news could mean a big investment in health care and your well-being.


Before serving as the Foundation’s communications associate for the last two years, Adam Chiara was a freelance reporter for several Connecticut media outlets. He is leaving the Foundation this month to pursue another opportunity. This blog post has been a reflection of what he has witnessed in the media industry from the perspective of being both a former journalist and working at a health care advocacy organization.

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Tough Decisions Ahead for Addressing Health Care Cost and Quality in Connecticut

By Jill Zorn

JZ graphicConnecticut’s Health Care Cabinet members had very mixed reactions to the draft recommendations  presented at their July 12 meeting on how to control health care costs in the state.

In 2015, the Connecticut General Assembly charged the Cabinet with coming up with a framework to slow the increase in health care costs in Connecticut, while still improving health care quality and outcomes.   This charge was written into SB 811, now known as PA 15-146An Act Concerning Hospitals, Insurers and Health Care Consumer.

Cabinet members, including representatives of insurers, hospitals, physicians and other health care stakeholders, advocates and state agencies listened carefully to the July 12 presentation by Bailit Health, the consultants who have been guiding the Cabinet’s work since January.  The consultants walked through their preliminary recommendations, emphasizing that their proposed framework is a “straw model” that should be viewed only as a jumping off point for discussion and refinement, and not as the “last word”.

Many of the ideas in the straw model come from strategies being implemented in other states as well as efforts already underway in Connecticut.  The framework consists of six interlocking sections:

  1. Improve population health
  2. Cap cost growth
  3. Support providers to transform care
  4. Support market competition
  5. Use data to make policy
  6. Coordinate and align state strategies

Each section contains multiple suggested goals and strategies.

We need a robust discussion on the proposed straw model.   But many barriers stand in the way of holding a constructive discussion and finding agreement including:

  • Lack of a clear statement of a shared vision and goals for Connecticut’s health care system
  • Complexity of the topic
  • One person’s health care “waste” is another person’s job, or another person’s potentially life-saving treatment
  • Lack of trust among stakeholders

The Cabinet has until December 1 to finalize recommendations and submit a report to the Connecticut General Assembly.  Gauging from the reactions at the July meeting, it will not be easy for this disparate group to come to consensus.

The Cabinet would benefit from hearing from the public as they work to craft their final recommendations.  One option would be to provide public comment at their next meeting, scheduled for September 13 at 9 am at the Legislative Office Building.

Connecticut is trailing many other blue states that have a head start on tackling health care cost and quality concerns. We need a more coordinated effort.  We can and should do better.  The status quo is not an option.

If you’re considering commenting on the straw model, you can learn more by digging into these resources:

  • A previous blog about the Cabinet cost containment study can be found here
  • Materials and minutes from the Cabinet’s 2016 meetings can be found here, beginning with the meeting on January 12, 2016 (scroll down). These materials include overviews of how six other states are working on health care cost and quality:  Rhode Island, Massachusetts, Vermont, Maryland, Oregon and Washington.
  • The Cabinet’s charge from the Connecticut General Assembly can be found in PA 15-146, Section 17, (pages 40-42)
  • To watch an archived CT-N video of the consultant’s presentation on July 12 and Cabinet members’ initial reactions, go here
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