No Ready-Made Rx For Rising Drug Costs

When Turing Pharmaceuticals raised the price of an older generic drug by more than 5,000 percent last month, the move sparked a public outcry. How, critics wondered, could a firm charge $13.50 a pill for a treatment for a parasitic infection one day and $750 the next? The criticism led Turing’s unapologetic CEO to say he’d pare back the increase – although no new price has yet been named – and the New York attorney general has launched an antitrust investigation. The outcry has again focused attention on how drug prices are set in the United States. Aside from some limited government control in the Veterans’ health care system and Medicaid, prices are generally shaped by what the market will bear. A jump in the number of new expensive drugs hitting the market — along with moves by drugmakers like Turing to raise the price on older and generic drugs — have helped make prescription drugs the fastest-growing segment of the nation’s health care tab. Prescription drugs account for about 10 percent of all health care spending. Two ideas for curbing that spending surface every time a price spike renews interest in drug costs: Letting consumers buy products from other countries with lower prices set by government controls, and allowing Medicare administrators to negotiate drug prices, from which they are currently barred. Both proposals are getting an airing in Washington and on the campaign trail, pushed by Democratic presidential candidates Hillary Clinton and Bernie Sanders. Opposition is heavy, particularly to Medicare negotiations, and neither is likely to gain much traction.

Source/more: CNN Money
Related: Seniors Who Don’t Change Part D Drug Plans Could See Costs Rise Steeply

David Wingate is an elder law attorney at the Elder Law Office of David Wingate, LLC. The elder law office services clients with powers of attorneys, living wills, Wills, Trusts, Medicaid and asset protection. The Elder Law office has locations in Frederick and Montgomery Counties, Maryland.