The MIC Circular Firing Squad

Posted on | December 16, 2017 | Comments Off on The MIC Circular Firing Squad

Mike Magee

If you want to see the Medical-Industrial Complex (MIC) in full “circular firing squad” mode, simply check out the recent Energy & Commerce Committee hearings on soaring drug prices hosted by chairman Rep. Greg Walden (R-OR). Delivering tough talk to committee members, he said, “Consider yourself on [the working group] if you’re on the healthcare subcommittee.”

All for one, one for all. But not so much inside the MIC and its purposefully complex supply chain where every participant gets a piece of the action, and the actions drain the consumer pocket book.

Check out the “dialogue”:

AMA seemed focused on complexity over cost. Board Chair Gerald Harmon, MD said, “Affordability and price can be a major barrier, but so are the hoops we have to jump through — prior authorization, changing drug formularies, step [regimens] — all put in by insurers to manage costs.”

Insurers say, No way! They point to PhRMA. Their rep Matt Eyles says, “Any discussion of drug prices in the supply chain must start with the list price, which is set solely by drug companies and which acts as a starting point for plans and PBMs to negotiate lower prices for consumers. Out-of-control prices are the result of drug companies taking advantage of a market skewed in their favor.”

Fresh off the vertical integration startegies of CVS/Aetna and United Healthcare/Optum, the PBM’s piled on. Their trade leader Mark Merritt said, “Prices are set exclusively by drug companies with zero input from anybody else in the supply chain, including PBMs.”

PhRMA spokesperson Lori Reilly cried foul. She claimed the PBMs pull $100 billion out of the system each year, adding with a figurative “tear in her eye”, “Unfortunately, many times those discounts and rebates are captured by intermediaries and don’t make their way back to patients.” Doug Hoey, representing independent pharmacists agreed – and with more detail: “Opaque PBM practices include PBM-retained rebates and spread pricing, generic drug reimbursement schemes, and direct and indirect remuneration (DIR) fees assessed on pharmacies months after a prescription is filed.”

Consumer group head David Mitchell didn’t pick an MIC loser from the above list. He simply said “We should allow Medicare to negotiate prices for patients.” But to do that we’d have to declare that the MIC back door collusion days are over, not just on drug pricing, but also on research, medical education, governmental advisory councils, peer review publications, patent profiteering, and academic career advancement.

The starting point for all of the above is universality and solidarity in health coverage. Beyond helping to correct income disparity and moving us together toward a more empathetic culture, it would also force planning, budgeting, and prioritization to address the critical question we as a nation have avoided for so long, “How do we make America (and all Americans) healthy again?”