Speaking yesterday at America’s Health Insurance Plans’ (AHIP) National Health Policy Conference, FDA Commissioner Scott Gottlieb railed against patient cost-exposure (e.g., copays). His prepared speech said:
Patients shouldn’t be penalized by their biology if they need a drug that isn’t on formulary. Patients shouldn’t face exorbitant out of pocket costs, and pay money where the primary purpose is to help subsidize rebates paid to a long list of supply chain intermediaries, or is used to buy down the premium costs for everyone else. After all, what’s the point of a big co-pay on a costly cancer drug? Is a patient really in a position to make an economically-based decision? Is the co-pay going to discourage overutilization? Is someone in this situation voluntary seeking chemo? Of course not. Yet the big co-pay or rebate on the costly drug can help offset insurers’ payments to the pharmacy, and reduce average insurance premiums. But sick people aren’t supposed to be subsidizing the healthy.
Wow. This may seem like common sense to some readers, but it is revolutionary to hear from a senior American government official, and indeed a Republican one no less.
In a new paper, Victor Laurion and I have chronicled the ways in which American politicians at the highest levels have blindly embraced the opposite point of view for half-a-century. This sort of ideological adherence to simplistic economic reasoning (which James Kwak calls ‘economism‘) is why U.S. health insurance exposes patients to all sorts of deductibles, copays, and coinsurance. As a result, even insured Americans find themselves “underinsured” — denied access to care or falling into bankruptcy if they stretch to pay nonetheless. Continue reading