Federal Judge Blocks “Drug Transparency Rule”
Support Drug Price Transparency – STOP DRUG MANUFACTURER GREED
July 9, 2019, Credits to Dena Bunis, AARP, and related AARP reporting
A federal judge has blocked a Department of Health and Human Services (HHS) rule that would have required drug manufacturers to reveal the retail prices of their medications in their television ads. The regulation was set to take effect Tuesday, July 16, 2019.
Judge Amit Mehta of the U.S. District Court for the District of Columbia ruled late Monday that HHS overstepped its authority in issuing the drug transparency rule saying Congress had not authorized such a policy. “No matter how vexing the problem of spiraling drug costs may be, HHS cannot do more than what Congress has authorized,” Mehta wrote in his ruling. Why has Congress dropped the ball and not authorized the policy? It’s shameful.
The HHS rule would require drug makers to state in their direct to consumer television advertisements the list price of any drug that is covered by Medicare and Medicaid if those medicines cost more than $35 for a 30-day supply. While drug makers now are required to display the side effects of the medicines they advertise directly to consumers, the prices of those drugs have remained a mystery for most patients. The new federal rule, blocked by Judge Mehta, requires pharmaceutical companies to update their prices in the ads every three months, make the price disclosures legible in the ads, and include a disclaimer saying the cost of the drugs may be different for people who have insurance that covers prescription drugs.
"Although not a silver bullet to solve our prescription drug crisis, this is an important positive step toward increasing transparency and holding pharmaceutical companies accountable,” says Nancy LeaMond, AARP executive vice president and chief advocacy and engagement officer. More transparency in the way prescription drugs prices are calculated and communicated to the public is one of the solutions AARP is seeking as part of its Stop Rx Greed campaign to lower the cost of prescription drugs for all Americans.
Even though many Americans have prescription coverage either through private insurance or a public program like Medicare or Medicaid, the list price of a medication does matter to many consumers. For example, 47 percent of Americans have high-deductible health insurance plans, under which they often pay the list price of a drug until they reach the deductible, according to a Centers for Medicare and Medicaid Services (CMS) fact sheet on the new regulation. CMS officials also said that an increasing number of Medicare Part D prescription plans have a deductible that patients must meet before being reimbursed for prescription costs. Many beneficiaries are responsible for coinsurance for certain prescriptions, and those out-of-pocket costs are calculated based on a drug's list price. Individuals who don't have drug coverage or whose insurance doesn't cover a particular medication also must pay the list price.
AARP's Public Policy Institute has tracked the prices of widely used prescription drugs since 2004. Its latest report found that the average annual retail cost for just one popular brand-name drug among the 267 that AARP studies was nearly $6,800 in 2017—well above the $35 per month threshold that would require a drug maker to disclose the price in any television ad. The Rx Price Watch Report also found that the retail prices of widely used brand name drugs increased by an average of 8.4 percent in 2017—four times the rate of inflation.
Such escalating drug costs “will eventually affect all of us in the form of higher taxes, cuts to public programs, or both,” Leigh Purvis, AARP's director of health services research,” said in testimony before Thursday's House Energy and Commerce Health Subcommittee hearing on lowering drug prices. “In other words,” Purvis said, “every single person in this room is paying for high prescription drug prices, regardless of whether you are taking one yourself.”
"Drug list prices have been shrouded in secrecy for too long,” Nancy LeaMond, AARP executive vice president and chief advocacy and engagement officer, says in a statement expressing the organization's disappointment over the court ruling. “Today's ruling is a step backward in the battle against skyrocketing drug prices and providing more information to consumers." It also reflects a lack of preparation on the part of HHS and its lawyers to create a policy that did not overstep its bounds by infringing on the authority of Congress while, at the same time, once again reflects a lack of diligence on the part of Congress to address this crisis.
You think the pharmaceutical lobbying industry doesn’t have power? This is a closed community, based on “socialistic greed,” which receives far too much help from the government based on purposeful lack of oversight that permits these companies time and time again to price fix, pay kickbacks, and conspire to control the market so that every greedy company gets its ”fair share” to the detriment of the consuming public, all the while ignoring antitrust laws and deleting honor and integrity from the business model.
Socialism, which very few understand and even fewer take the time to understand its application to the business community, is a political and economic theory of social organization which advocates that the means of production, distribution, and exchange should be owned or regulated by the community as a whole. The drug makers have made their own socialistic community; they control production, distribution, and profit by conspiring with one another to completely control the market. The government and the politicians have created this socialistic business community of utter greed by failing to pay attention and by succumbing to the lure of financial support from the industry. It’s no different than how the big banks and financial institutions controlled the global market before the collapse. Yet, there we were bailing them out, socialistically, as soon as they collapsed.
For several years, states have passed or been considering legislation that would require drug makers to report the reasons behind dramatic price increases. The laws require pharmaceutical companies to justify high launch prices and price hikes. The principle behind the legislation is that greater disclosure around market pricing will help drive down costs. As of June 2018, seven states (California, Connecticut, Maine, Maryland, Nevada, Oregon and Vermont) had enacted drug transparency laws. Florida has not because during his 2 terms as governor Rick Scott had no incentive to do so, nor did the Republican legislature.
The lawsuit against the transparency rule was brought (Big Surprise) by three drug makers — Merck, Eli Lilly and Amgen. Thanks to these companies, Nancy LeaMond says, “millions of Americans will be prevented from seeing the astronomical price tags of the drugs being advertised on TV." Why do you think these drug makers don’t want you to know? It’s no different
High drug prices “disproportionately hurt older Americans, particularly Medicare Part D enrollees who take an average of 4.5 prescription medications each month,” LeaMond says. “Most Medicare beneficiaries live on fixed incomes, with a median annual income of just over $26,000."
AARP has been the principle advocate on behalf of all Americans in an effort to compel transparency on prescription drug prices as one solution to the runaway costs of medications.
HHS officials said they were disappointed by the judge's ruling and will work with the Department of Justice on the next steps in the litigation. Being better prepared would be a good first step and actually getting Congress, even in, perhaps, the most politically divisive time in history to work together on an issue that should be a no-brainer is the mandatory second step.