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Thursday, August 25, 2016

Obamacare to Blame for EpiPen Price Gouging

The drug maker Mylan is being rightly excoriated for it's unconscionable price increases of EpiPens. What is not getting the attention it should is that Mylan was able to get away with it because of Obamacare.

As you can see from the following graph, most of the increases have happened after Obamacare was passed in March 2010.

Epipens in Canada can still be purchased for about $100, instead of $600+ as in the United States. There is no reason for the higher price except that Mylan can legal get away with it.

Back when the details of Obamacare were being debated some reformers saw the potential for abuse and wanted to include rules that would keep this from happening. Such reforms were doomed because a key supporter that Obama co-oped to back up his health care expansion was Big Pharma. Big Pharma supported Obamacare because it knew things like this would be possible. Despite Obama's promises that his program would save every household $2,500 a year, the medical industry knew this was a lie. Obamacare was merely a big government expansion of a broken, wasteful system to provided more overpriced services to more people.

Here is one example of one sweet deal Big Pharma got in Obamacare. At one point Obamacare was going to be structured to favor generic drugs. However, in the final version, Big Pharma was able to get co-pay free drugs approved, a feature Mylan exploits. This means that Mylan's more expensive EpiPen drug can be picked without a co-pay - no upfront cost to the customer, but higher costs overall on the back end that the consumer doesn't see but results in increased premiums for everyone. However, many people have picked healthcare plans where they pay the first few thousand dollars out of pocket before reaching their deductible, so Mylan's trick is now out in the open.

How bad did Obamacare blow its chance to fix health care? Here is a quote from Confidence Men, by liberal author Ron Suskind where he talks about Dartmouth Method reformer Dr. Jim Weinstein, whose research had found widespread waste and unnecessary procedures throughout the health care industry and was hopeful that ObamaCare would address these obvious problems. However, special interests like Mylan squelched any chance at these much needed reforms.

To spend a ¨once-in-a-generation¨ effort on extending coverage to the uninsured--without any real teeth in using evidence about what was effective in reducing unnecessary procedures, and driving down costs--was a ¨stunning error.¨

¨It made things worse,¨ he said solemnly.

And then he got frustrated. ¨I can´t believe how wrong they got it. This was our one chance, and we completely blew it.¨

The moral to the story is if you leave it up to Big Government, you are setting yourself up to be taken advantage of by special interests who buy off legislators. Obamacare is a failure that has only made things worse.

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