Berks County Medical Society Medical Record Fall 2018 - 40

Drug Costs, Drug Shortages and Group Purchasing Organizations
continued from page 39

Prior to 1991 GPOs were small, low revenue companies that
served hospitals and were not permitted to demand kickbacks from
manufacturers. In 1991 GPOs experienced their Big Bang moment
and received permission from Congress and Health and Human
Services (HHS) to collect kickbacks. Suddenly the revenues of
GPOs exploded. Health care costs soared.
The Big Three Pharmacy Benefit Managers (PBMs) also write
secret contracts for over 80% of all outpatient prescriptions. They
were modest sized companies until their Big Bang moment in 2003
when the GPO Safe Harbor was inexplicably extended to PBMs.
Now PBMs happily join GPOs in ruling over the healthcare
universe, controlling the entry and pricing for the healthcare
supply chain for nearly all outpatients prescription drugs.
Kickbacks are a percentage of revenue so inflationary incentives
prevail. This explains how in 2000 Americans' prescription drug
costs were $121B and in 2017 $360B. PBMs enjoy extraordinary
profit margins. Thus the rush to either buy one or be bought by
one in the marketplace. Merger mania!
Generic pharmaceutical companies and medical device
manufacturers have not disclosed just how much they must pay
to gain access to their customers on the other side of the GPO/
PBM paywall. The cumulative evidence suggests well over $200B
in healthcare cost savings by cutting out the middleman kickbacks.
This does not include the incalculable financial benefits of restoring
freedom to the marketplace for suppliers to compete.
If these funds were re-directed from the pockets of businessmen
and the campaign coffers of politicians and used instead for
healthcare some interesting things would happen. The Association
of Community Pharmacists projects outpatient prescription costs
would fall by one third if rebates are eliminated. Hospital costs and
insurance premiums would fall. Medical device and generic drug
manufacturers would experience a renaissance in their businesses.
Capital investment for new manufacturing plants in America
would result in thousands of high paying American jobs.
The middle class does not have to disappear. It is time for
kickbacks to disappear and the American middle class to re-appear.
Of course all of these financial calculations do not include any
calculation of the human toll exacted by the many hundreds of
medications in short supply or not available at all. Cardiologists
inserting temporary pacemakers because the hospital has no
bicarbonate. Bad care. No spinal anesthetics. Bad care. Out of
Fentanyl. Bad care.
The cost of healthcare is beyond the reach of too many
middle class Americans. Repealing the GPO/PBM Safe Harbor
for Kickbacks will fix this problem. A bill is already written and
Physicians Against Drug Shortages is doing what it can to get it
introduced.

40

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www.berkscms.org

Mid-term elections are approaching. Politicians will need to
make themselves available to their voting constituents. The theme
for the mid-term elections should be let doctors and patients join
together to save healthcare. Physician-driven and patient-centered
Healthcare Town Halls will be coming to many communities.
If you wish to host one just let me know. I anticipate 60 in
60 different districts nationwide, but we may have even more.
Repealing this Very Unsafe Safe Harbor will be item number one
for discussion.
There is no path to affordable, high quality healthcare until
free-market competition is restored to the drug/medical supply
marketplace. This is possible only if Congress repeals the GPO/
PBM Safe Harbor for Kickbacks. Find out if your Congressmen
are in favor of unaffordable healthcare kickbacks or opposed. Both
Pennsylvania Senators Casey and Toomey are briefed and are in
favor of kickbacks. Repeal could be "disruptive" to the market.
That is the goal, Senators. Pennsylvanians deserve better. Replace
the broken marketplace with a new competitive market that works
and lowers costs for patients. What a perfect issue for physicians to
assert leadership!

Physicians Against
Drug Shortages
* There have been drug shortages since 2006
* There is skyrocketing inflation for all medications
* Americans are paying more money for less
healthcare
* Something is happening here!
* What it is isn't exactly clear, unless....
You are a member of
Physicians Against Drug Shortages
Join now.
www.PhysiciansAgainstDrugShortages.com
No dues, just clarity and awareness


http://www.PhysiciansAgainstDrugShortages.com http://www.berkscms.org

Berks County Medical Society Medical Record Fall 2018

Table of Contents for the Digital Edition of Berks County Medical Society Medical Record Fall 2018

Berks County Medical Society Medical Record Fall 2018 - 1
Berks County Medical Society Medical Record Fall 2018 - 2
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