The price of healthcare and pharmaceutical drugs in the United States is the highest among any other country in the world. Countries who are as developed as the U.S. provide prescription drugs at a fifty percent lower cost than the U.S. The cost of Medicare and Medicaid will consume increasing shares of our economy and our federal budget in the years and decades ahead. Due to the lack of federal regulations, drug manufacturers can set prices for their drugs higher than the average consumer can afford to maximize profits and take advantage of people’s health needs. Federal regulations are needed to change healthcare costs and help keep health expenditures sustainable in the face of an aging population. The anti-regulatory culture of the United States enables drug manufacturers to monopolize brand name drugs, increase healthcare costs, and take advantage of the people who need healthcare and prescription drugs the most in this country.
Section 1 – Prescription Drug Costs
Prescription drugs treat illnesses and symptoms that could potentially result in death. Some treatable illnesses include epilepsy, depression, multiple sclerosis, obsessive compulsive disorder, and diabetes. Fifty-four percent of Americans take prescription drugs while nineteen percent of those Americans take four or more medications a day. Sometimes purchasing prescription drugs is difficult. First, a patient must find a provider that takes his or her insurance or pay out of pocket. Then, the person must be able to travel to a local pharmacy or acquire the medication through mail order. There are many issues that can occur when filling a prescription, for example, it may be too soon to fill, require a prior authorization, or simply the patient cannot afford it (Trioni, 2010). The difficulty of obtaining prescription drugs, combined with its price, is a major issue for consumers.
The most significant reason for drug prices increasing is the monopolies that drug manufacturers have and the long time it takes for drug manufacturers to patent and develop their drug. People around the country struggle to find ways to fill their prescriptions and have access to their medication. Three in ten adults (29%) say they have not filled a prescription because of the high cost. Nearly a quarter of people report that they have cut pills in half or skipped doses to make their prescription last longer (Lupkin, 2016). A country as well developed as the United States should not be forced to go without medication due primarily to cost.
Another issue that results in the high cost of prescription drug prices is the relationships between physicians and drug manufacturers. Drug manufacturers partner with doctors and facilities to market their brand name drugs to the public and give free samples to doctors’ offices. This partnership results in unbiased decision making among doctors when choosing a medication for a specific patient. A solution to this issue is to more strongly regulate manufacturers and physicians from partnering together because this limit patients’ options when receiving treatment for an illness.
The United States does not regulate the prices of prescription drugs compared to other countries where prices are more heavily regulated, which results in a lot cheaper drugs. Since the drug prices are not controlled in the United States, drug manufacturers can set any kind of price for the drugs that they develop. According to Deangelis (2016), in 2013, the profit margin for drug companies increased from 10% to 42% with an average margin of 18% overall (p. 30). There must be regulation laws that protect citizens from paying astronomical costs for their prescriptions. Many people rely on medications to live; if the drug prices are too high for a person to purchase, then they will be forced to stop using the medication, thus resulting in complications or possibly death.
Manipulative advertising because of anti-regulation shows the differences among cultures and how we protect our society. According to Habibi, et al. (2016), “No information on harmful effects was provided in approximately two-thirds of North American [drug] promotions, and nearly 40% of promotions in France.” More information was provided in France on the drug manufacturers websites, which demonstrates the higher level of drug regulation that they have. However, the serious adverse effects were not mentioned at all in both U.S. and France. The fact that drug companies do not have to disclose their serious side effects shows how deregulated the United States is. Drug manufacturers want their product to seem perfect so that more people will potentially buy it.
Many politicians such as Bernie Sanders are against Big Pharma and the high drug prices for the people of the United States. He believes that the pharmaceutical industry “gets away with murder” because of the astronomical prices of drugs thus not allowing people to get the medication they need which may result in the person dying. Bernie Sanders said, “…pharma having a huge number of lobbyists. It’s true. Pharma does have lobbyists all over the country, not just in Washington. These people are horrific. They just spent $130 million in California to defeat legislation that would lower prescription drug prices in California” (Carter & Schumaker, 2017). The United States is the largest market for prescription drugs, yet we still charge the highest copay possible for our drugs.
The FDA has strict regulations for the United States for prescription drugs. This is due to a case in 2000 when drugs were smuggled into the U.S. from another country and the child died as a result of the unregulated drugs (U.S Food and Drug Administration, 2018). Under the FD&C Act, drugs without FDA approval that are interstate shipped are illegal which includes the importation from other countries outside the United States. Drugs that are distributed in the U.S. must have proper labeling the adheres to the FDA requirements as well as good manufacturing practices that are set by the FDA (U.S Food and Drug Administration, 2018). The FDA sets high standards for manufacturing drugs and they can only be produced at plants registered with the FDA whether that be domestic or foreign (U.S Food and Drug Administration, 2018).
Setting high standards and rules for manufacturing drugs in the U.S. results in higher prices of the drugs. “In the U.S. a 30-day prescription to Xarelto (used to treat blood clots) costs $292, on average – where that same prescription costs just $126 in the UK, $102 in Switzerland, and just $48 in South Africa” (Beaugureau, 2017). The U.S also does not negotiate prices with pharmaceutical companies like other countries do. Since the U.S doesn’t have a single-payer for healthcare the government is not involved in regulating the prices of the prescription drugs (Beaugureau, 2017). This results in many individuals not being able to afford their medication and going without it and possibly risking their health and safety. If the U.S had a single-payer healthcare system instead of numerous commercially funded insurance companies the drug prices would be much lower for Americans (Beaugureau, 2017).
Since there is no regulations between the U.S. government and drug manufactures, many Americans choose to break the law and illegally purchase drugs outside of the U.S. On a poll taken, eight percent of Americans said that they or someone they knew has purchased a prescription drug outside the U.S. That would translate to about 19 million adults in the U.S. based on current Census population estimates (Bluth, 2016). This percentage may seem low but compared to what government officials predicted was only two percent. Many Americans are uncomfortable talking about affording their healthcare and therefore struggle in silence when they really should not have to (Bluth, 2016).
The deregulation of drug manufacturers allows pharmaceutical companies to set any price they want for a drug and increase it as well (Lupkin, 2016). High prescription drug costs do not allow some people access to their medication. Many people go without their medication because they cannot afford it (Lupkin, 2016). New regulation laws must go into effect to help people who rely on medication to continue to get their medication without the financial burden. Deregulation is a political issue, and the only way for it to be achieved is widespread political change. Our country has a majority of conservative politicians in the House of Representatives, Senate, White House, and in state congresses across the country (Carter & Schumaker, 2017). Conservatives are generally opposed to regulations.
Both Democrats and Republicans are lobbied by pharmaceutical companies to leave their business practices alone (Carter & Schumaker, 2017). While the issue affects many consumers, it is decided ultimately by legislators who choose to create law that may help them. The progressive left is perhaps the largest and most consistent group who is opposed to lobbying, big pharma, and other immoral practices (Carter & Schumaker, 2017). Therefore, revolutionizing our political system and swaying United States voters to support politicians who will not take campaign contributions and other bribes in the form of lobbying may be the only way to stop medicine costs from rising with no penalties (Carter & Schumaker, 2017).
Section 2 – Healthcare Costs
The rising costs of healthcare in the United States is an epidemic and effects the older population especially. The rate of spending has increased passed inflation and wage growth (Rother, 2016). This means that the costs of healthcare are too expensive for the population. The older population is often always on a fixed income and therefore have an even harder time with affording their doctors and medical bills. Rising premiums and deductibles are a major factor in the traumatic high trend in healthcare costs (Rother, 2016). It is difficult for middle class families to afford family insurance plans at the rate that they are at currently. Most people have to get a second job or budget just for their family’s healthcare. At this rate presently, Americans will experience higher rates of illness, disability, and early mortality than they otherwise might if costs were lower (Rother, 2016).
There are three major reforms that need to be made in order for change to occur within the healthcare cost market. These three are: reform healthcare delivery and benefits to better care for the chronically ill, make prescription drugs more affordable; and reduce demand for healthcare through public health initiatives (Rother, 2016). These root causes have been known in the United States for quite some time now. The poor quality in healthcare is due to the failures of care coordination; high cost prescription drugs are because of inefficient and uncompetitive markets for drugs, and the high demand of healthcare is due to the high rates of preventable chronic disease care (Rother, 2016).
The first reform that needs to be made is with healthcare delivery. This means we need effective care for the chronically ill (Rother, 2016). The U.S agency for Healthcare Research and Quality estimates that people with multiple chronic conditions (5 percent of the population) account for 66 percent of total healthcare spending (2016). Our current healthcare system does not give these patients effective and efficient care. They receive inefficient, ineffective, and uncoordinated care from their physicians (Rother, 2016). Doctors are often busy and sometimes overlook certain patients and symptoms which results in poor and sometimes fatal care for their patients. This is a result in the increased population and increased number of chronic illness that patients unfortunately have. In the past, primary care physicians have been trained to diagnose patients’ needs as a whole and design care accordingly (Rother, 2016). This is extremely important for older adults and disabled Americans currently (Rother, 2016).
Another example to help reform healthcare delivery is the wider use of medical homes and other advanced primary models (Rother, 2016). Medical homes reassure patients that all of their needs are being met and allows the primary care physician to contact specialists when they need to provide more efficient or specific care. It is proven by evidence that areas, states or nations with stronger primary care centers have lower healthcare spending (Rother, 2016). In order to lower the costs of Medicare and overall healthcare costs as a whole, primary care must be a top priority (Rother, 2016). This would ultimately help the population and make sure that the patients’ needs are taken care of and nothing is overlooked.
Another contributor to the rising healthcare costs is alcohol. Alcohol related illness and accidents contribute to an estimated $27.5 billion in healthcare costs annually (Rother, 2016). This number included the considerable costs due to lost productivity, car insurance claims, and criminal justice expenses (Stahre et al., 2014). The Centers for Disease Control and Prevention (CDC) estimates that excessive drinking is responsible for one in ten deaths among working age adults. It is also the fourth leading preventable cause of death (CDC, 2015). The United States used higher taxes and the enforcement of retailer compliance concerning the sale of alcohol to minors (Rother, 2016).
The U.S healthcare spending is one of the largest industries in the country. In 2016, U.S. healthcare costs were $3.3 trillion (Amadeo, 2018). The United States relies on company-sponsored private health insurance. (Amadeo, 2018). Since the government created Medicare and Medicaid to help those without insurance; the need for healthcare services has increased significantly (Amadeo, 2018). A Princeton University study found that the United States spends 60 percent more in healthcare than Europe (Amadeo, 2018). We use the same amount of healthcare services but just pay a lot more. The governments intentions were to lower the costs but rather they increased instead (Amadeo, 2018).
Another factor in the vast amount of money spent in health care is chronic illness. Ailments such as diabetes and heart disease contribute for 85 percent of healthcare costs. According to Amadeo, almost half of Americans have either diabetes or heart disease (2018). The more difficult to treat the more expensive the costs are that are associated with the treatment. This results in the sickest 5 percent of the population spend 50 percent of the total healthcare costs (Amadeo, 2018). Most of these patients are Medicare patients; spending for patients in the last year of life is six times greater than average (Amadeo, 2018). Elderly and chronic illness patients contribute to over half the total spending in healthcare.
The four leading causes of death are heart disease, cancer, chronic obstructive pulmonary disorder (COPD), and stroke (Amadeo, 2018). All of these are chronic diseases and can be prevented or cost significantly less if caught earlier. If adults had more access to healthcare facilities, specifically primary care centers, there would be less people with chronic illnesses. There are obvious risk factors for the mentioned chronic diseases such as: poor nutrition obesity and smoking (Amadeo, 2018). If these diseases are not caught early on they are more expensive to treat. These diseases cost an extra $7,900 each which is five times more than an average healthy person (Amadeo, 2018).
Administrative costs and doctors’ salaries are a major contributor to the high costs in healthcare (Commins, 2018). In the United States we account for $752 per-capita of Americans’ annual healthcare spending (Commins, 2018). This means that on average American’s spend $752 on healthcare each year for each person. In the Netherlands it is $208 and $232 in Germany. That is a big difference compared to the rest of the world. The U.S. spends almost twice as much as ten other wealthy countries (Commins, 2018). The excessive amount of money spent on healthcare could be reduced and there would be more resources for better social uses (Commins, 2018). This study also found how the high-prices of certain procedures are two to six times more in the U.S. These procedures include: caesareans, knee and hip replacements, coronary artery bypasses, and angioplasties (Commins, 2018).