On Friday, November 24th, the Wall Street Journal editorial board published an article discussing Senator Elizabeth Warren's (D-MA) overdue "epiphany" regarding ObamaCare and its unintended consequences that the American people are suffering from years after its implementation.
According to the article, Warren, who has long supported the Affordable Care Act, which is the official name for ObamaCare, has as of late, come to an 'epiphany' about "industry consolidation and price increases caused by the healthcare law."
In a bipartisan letter, she and Senator Mike Braun (R-IN), complained that the "nations largest health insurers are dodging ObamaCare's medical loss ratio (MLR)." In the letter, Warren describes that health insurers have "exploited the situation," making for "sky-high prescription drug costs and excessive corporate profits."
Warren wrote, in part, "In functioning markets, generic drugs cost 80 to 85 percent less than their name-brand equivalents, giving patients much-needed relief from high drug costs and saving taxpayer dollars. But patients, including patients in public healthcare programs like Medicare and Medicaid, who either use or are compelled to use vertically integrated specialty pharmacies are not seeing this relief."
Warren and Braun added, "By owning every link in the chain, a conglomerate like UnitedHealth Group, which includes an insurer, a PBM, a pharmacy and physician practices, can sent inflated medical payments to its pharmacy. Then, by realizing those payments on the pharmacy side — the side that charges for care — rather than the insurance side, the insurance line of business appears to be in compliance with MLR requirements, while keeping more money for itself."
The letter goes on to explain, "Today, UnitedHealth Group sends 25 percent of its medical claim revenue to its Optum subsidiaries. In other words, to itself. Similarly, in 2019, CVS Heath sent 13 percent of its profits to its own providers and pharmacies."
The result, Warren and Braun said, is that "[c]onsumers and taxpayers foot the bill for these games through higher insurance premiums and out-of-pocket costs."
At the end of the letter sent by Warren and Braun, they wrote, "This type of vertical integration in the drug supply chain is raising prescription drug costs, which are already far too high, while undermining Congress' intent of improving health care quality."
The article published in the Wall Street Journal said that even though Democrats argued that the MLR would help patients, "the rule has spurred insurers to merge with or acquire pharmacy benefit managers (PBMs), retail and specialty pharmacies and healthcare providers."
The editorial board wrote, "This has made healthcare spending less transparent since insurers can shift profits to their affiliates by increasing reimbursements," adding, "It's a familiar story: Big government intervention creates incentives and raises costs that help big business, and then politicians demand more government intervention to fix the distortions they caused."
In the past few years, Warren has voted against ObamaCare repeal efforts, but at then pushed for a "Medicare for All" proposal when she ran for president back in 2020. On her one-pager, she wrote, "America spends about twice a much per person on health care than the average among our peer countries while delivering worse health outcomes than many of them."
She added, "America is home to the best health care providers in the world and yet tens of millions of people can't get care because of cost, forcing families into impossible decisions. Whether to sell the house or skip a round of chemo. Whether to cut up pills to save money or buy groceries for the week. The way we pay for health care in the United States is broken and America's families bear the burden."
According to the article, Warren, who has long supported the Affordable Care Act, which is the official name for ObamaCare, has as of late, come to an 'epiphany' about "industry consolidation and price increases caused by the healthcare law."
In a bipartisan letter, she and Senator Mike Braun (R-IN), complained that the "nations largest health insurers are dodging ObamaCare's medical loss ratio (MLR)." In the letter, Warren describes that health insurers have "exploited the situation," making for "sky-high prescription drug costs and excessive corporate profits."
Warren wrote, in part, "In functioning markets, generic drugs cost 80 to 85 percent less than their name-brand equivalents, giving patients much-needed relief from high drug costs and saving taxpayer dollars. But patients, including patients in public healthcare programs like Medicare and Medicaid, who either use or are compelled to use vertically integrated specialty pharmacies are not seeing this relief."
Warren and Braun added, "By owning every link in the chain, a conglomerate like UnitedHealth Group, which includes an insurer, a PBM, a pharmacy and physician practices, can sent inflated medical payments to its pharmacy. Then, by realizing those payments on the pharmacy side — the side that charges for care — rather than the insurance side, the insurance line of business appears to be in compliance with MLR requirements, while keeping more money for itself."
The letter goes on to explain, "Today, UnitedHealth Group sends 25 percent of its medical claim revenue to its Optum subsidiaries. In other words, to itself. Similarly, in 2019, CVS Heath sent 13 percent of its profits to its own providers and pharmacies."
The result, Warren and Braun said, is that "[c]onsumers and taxpayers foot the bill for these games through higher insurance premiums and out-of-pocket costs."
At the end of the letter sent by Warren and Braun, they wrote, "This type of vertical integration in the drug supply chain is raising prescription drug costs, which are already far too high, while undermining Congress' intent of improving health care quality."
The article published in the Wall Street Journal said that even though Democrats argued that the MLR would help patients, "the rule has spurred insurers to merge with or acquire pharmacy benefit managers (PBMs), retail and specialty pharmacies and healthcare providers."
The editorial board wrote, "This has made healthcare spending less transparent since insurers can shift profits to their affiliates by increasing reimbursements," adding, "It's a familiar story: Big government intervention creates incentives and raises costs that help big business, and then politicians demand more government intervention to fix the distortions they caused."
In the past few years, Warren has voted against ObamaCare repeal efforts, but at then pushed for a "Medicare for All" proposal when she ran for president back in 2020. On her one-pager, she wrote, "America spends about twice a much per person on health care than the average among our peer countries while delivering worse health outcomes than many of them."
She added, "America is home to the best health care providers in the world and yet tens of millions of people can't get care because of cost, forcing families into impossible decisions. Whether to sell the house or skip a round of chemo. Whether to cut up pills to save money or buy groceries for the week. The way we pay for health care in the United States is broken and America's families bear the burden."
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Comments
2023-12-01T14:39-0700 | Comment by: Rocco
Unintended consequences of government programs and regulations. Government involvement never makes anything better. It may appear better on the surface, but 100% guaranteed, the net benefit to society will be negative.