Treat Mental Illness With Respect

Mental illness, in all it's varied forms, is a horrible disease. It brings at least discomfort, and in many cases actual danger, to both the diseased persons and those around them. In modern societies we have for the most part learned to treat the afflicted with respect; we don't mock them, or tease them, or poke fun at them or their families. We try to be quietly supportive, lending whatever help we can with our very limited understanding.

In the past months, there have been an increasing number of commentators suggesting that our President, Donald Trump, is either mentally ill or is at least a borderline case. This diagnosis has been offered by all sorts of people who don't really have any qualifications; Senators, TV and radio pundits, social media raiders, and even some qualified psychiatrists. The most frequently offered diagnosis is "malignant narcissism", which itself is a little-understood syndrome. The four elements of this disease are  narcissism, paranoia, antisocial personality and sadism. We can clearly see that President Trump exhibits all four of those. (Note that there are professionals who also say that, while Trump certainly shows those characteristics, they don't rise to the level of mental illness)

But what are we to do? My first (and only) recommendation is that we all quit talking about it, and quit talking about Donald Trump in general. Ever since he entered the Presidential race in June of 2015, we have been obsessed with every word, every tweet, ever imagined slight, and every piece of evidence of his imbalance. This is harmful for two reasons:

First, all the attention we are giving Trump is simply feeding the beast. To a narcissist, even criticism is joy. As long as he can focus the nation's attention on anything he does, there's little reason for him to change any of his behaviors regardless of how toxic they may be.

Second, in fairness, mental illness should not be our daily entertainment. When someone is cracking up before our eyes, we shouldn't be riveted to our TVs and computer screens feeding our dark places with the by-products of a terrible disease.

Let's all go on a Trump fast. His cabinet and associates will provide us plenty of interesting stories of corruption and poor policies for the next several months. Let's let Donald and his family have some peace.

(Full disclosure: I am one of the worst offenders. This is as much my confession and contrition as it is a call for decency.)

Image  Johann Anwander [Public domain], via Wikimedia Commons

Confusion in the Buckeye State - So What?

This brings us to the question of "so what"? The idea behind Issue 2 is admirable - to lower prescription drug costs. And the method, to do it through legislation, appears to be the only path. The Pharmaceutical companies are not going to lower U.S. drug prices until they are forced to by some legal effort. Meantime, U.S. Citizens will continue to pay astronomical prices for key prescriptions.

How much do we pay? Let's look at one example (unnamed, but you can find this information yourself).
Using GoodRX.com, we can find the prevailing 'retail' prices for a drug. The V.A. prices are published at their website, as are the Ohio Medicaid prices.

Retail Price                  $4,500
V.A. Price                      1,383
Ohio Medicaid price      4,294

So, you can see that there is a huge difference in prices from Medicaid to the V.A. If Ohio paid the V.A. price, Ohio Medicaid would save 67%. For this particular medication Ohio paid a little over $80 million in 2016, so the saving to Ohio would be $54 million. An impressive amount for just one drug.

But what happens then? As the system is currently structured, the patient is on the hook for the difference between the retail price and the Medicaid reimbursement. Just like regular insurance. So the Mediciad subscriber (who is presumably struggling financially) would suddenly be faced with paying an extra $2,900 for the same prescription. This is probably not the outcome we are looking for.

In case you wondered, the National Health Service in the U.K. pays $944 for the same medication (current exchange rates). The cost across most EU nations seems to be about that - around $1,000 USD for the 2-pen package.

So, I think it can be said that Issue 2, while well-intentioned, is not ready for prime time. There are simply too many questions about where the money comes from and goes to, how it would be administered, and  how the rebates would be affected.

At the same time, the conversation has been started. Now it's time to get serious about managing drug prices in the U.S. Canada, Great Britain, and the E.U. are not third world countries; they've got as much money as we do, but pay only a fraction of the amount for the very same medicines. There are a lot of possible solutions to this, but we need to keep the pressure on our legislatures to actually confront the issue.


Prev: The Bottom Line

Confusion In The Buckeye State - Part 2

So what's the bottom line?

The State of Ohio paid a little over $3 billion for medications through Medicaid in 2016. If they paid V.A. prices for those medications, my estimate is that they would save about 10-15% of that. Why is it an estimate, and not a hard number? Well, there a lot of reasons, but there's two big ones.

First, the list of drugs available from the V.A. is much smaller than the list available from Medicaid. This is generally not because the drugs are different, but because Medicaid pays for a much wider variety of packaging than the V.A. does. Medicaid prescriptions are fulfilled through commercial pharmacies, so there are a lot of different options for how a particular prescription gets filled. V.A. medications, on the other hand, go through a relatively small number of outlets (V.A. Hospitals and clinics) so they can use a much smaller number of packages. (Incidentally, this smaller list gives the V.A. advantages in dealing with the drug companies, and efficiency in handling their stock of medications.)

Because of these differences, it simply isn't possible to get a one-to-one match between a Medicaid prescription and a corresponding V.A. prescription. My estimate includes an estimate of what the pricing would be, if in fact the V.A. actually had a price for all those packages. That's my estimate only.

"Nobody knew that health care could be so complicated". . . Donald Trump

But the bigger challenge is called the Medicaid Drug Rebate Program. This is a program under which the individual state Medicaid agencies get rebates from the Pharmaceutical Companies based on the amount of their drugs the state Medicaid program pays for. Essentially an earned-discount program. The Federal Medicaid folks calculate a baseline rebate amount, which is set by law. The individual states then negotiate their actual rebates with the drug companies. The actual rebate amounts are confidential. This gives the states negotiating leverage with the Pharma companies, but prevents us, the private citizens, from knowing what exactly the state pays for any particular drug.

The Ohio Office of Health Transformation has published an Executive Budget document which indicates that the total rebate to the state is over 50% of the total expenditure for Medicaid drugs. Because the rebate is confidential and negotiated on a company-by-company basis, it is highly likely that the pharma companies will simply take any reduced drug costs out of the rebates. It seems unlikely that they will continue to rebate over 50% of the old cost, when the new cost has reduced their revenues by 10%-15%.

So the Bottom Line? Who knows? There is certainly some potential that the State of Ohio could save money on Medicaid prescriptions. But, to this researcher, it's impossible to tell where or how much.

Prev:  Confusion - Issue 2 Next: So What?

Confusion In The Buckeye State - Issue 2

Where to begin . . .

I first became aware of, and interested in, Ohio Issue 2 when I began seeing negative ads about it in May of this year. Usually, ballot issues get some play in October if they're contested, maybe September if people are really hot about them. But May? Really? So I dove in.

Ohio Issue 2 is a ballot initiative that would say that the State of Ohio would never pay more for medications than the V.A. pays for them. From a superficial standpoint, that makes perfect sense. The V.A. is reputed to get very good drug prices through strong negotiations, so why wouldn't other government agencies want to take advantage of that? For all the negative advertising, including character assassination, there must be some serious dollars involved.

Using only publicly available data, I tried to find out what the dollar amounts involved actually were. At the start, it looked easy - The V.A. publishes the prices they actually pay for their medicines. These can be matched to a State of Ohio Medicaid website that gives the corresponding price, to the Medicaid patient, for exactly the same medicine. It's a little confusing because Ohio gives their prices in 'units', while the V.A. prices the entire package. But with enough perseverance, you can figure it out.

And the answer is a resounding "yes". The V.A. pays less, in about 90% of the cases, than the Ohio Medicaid price. In some cases, it's a LOT less, in others it's just a little less. In a handful of instances, they pay slightly more.

Simply knowing that some drugs are less expensive at the V.A. doesn't tell you a lot. You need to also know how much those drugs are actually being used. For that, we can go to a third agency, the U.S. Medicaid administration, which conveniently tells us how much of each drug was prescribed and paid for by Ohio Medicare. And that's where the fun starts.

It quickly became clear to me that there are three types of drugs on these lists. The first group is generics. Across the board, these are relatively inexpensive and the differences in V.A. and Medicaid prices are generally fairly small.

The second class of drugs is the patented, proprietary drugs. These are newer and more revolutionary, and include the ones you see advertised on TV. These drugs are amazingly expensive. Just amazing. But, the results they claim are also extraordinary, so I'm not going to make any judgments about 'value'.

The third class of drugs are those that are priced so astronomically, for no apparent reason, that Medicaid doesn't even list them. You can see one example of these in the Issue 2 advertising - where a family has no choice but to pay the several hundred dollar price increase to protect their children's lives. That's because Medicaid won't pay anything for that particular medicine.

Next up: What's the bottom line?

Throughout this set of articles, I'm going to try to avoid naming any particular medicine by generic or brand name. There's two reasons for that. One is that I'm not trying to pick a fight with any particular drug company or group. The second is that I have absolutely no expertise in medications or the practice of medicine in general. I do not want to leave the impression I'm trying to make any statement about the value of a particular statement.
I will be happy to share my data and analysis with anyone who wants to see the actual names and numbers.