Blaming Obamacare is the wrong diagnosis


The Wall Street Journal began the week by publishing a provocative essay in which a young man suggested Obamacare kept his mother from getting appropriate medicine for her cancer. The writer crafted a poignant story about his mother, who sounds like a good person with a bad disease.

Mainstream media buzzes with these types of stories. The Obamacare-is-the-problem narrative fits quite well on conservative news outlets.

The problem, as it so often is, is in the details.

The story here begins with a familiar first chapter: the writer’s mother had good insurance coverage but then it was cancelled. Next came her struggle to find a new policy on the federal exchange. The cancer patient ultimately learned that Humana would no longer cover her twice-monthly injections, and this left her with $14,000 in medical bills just two months into 2014.

I’m not sure what it was about this essay that stirred my journalistic self. Maybe it was the writer’s overuse of hyperbole (Procrustes, really?). Or that I expected more from the WSJ. Or that I’m trained to diagnose problems correctly, and blaming Obamacare for everything only delays fixing the real problems with American healthcare.

Though this case involves a specific drug for a rare cancer, the larger story centers on value, and evidence, and who pays for convenience, and this: why does an old drug cost so much?

A good place to start is to ask why Humana would deny coverage for this woman’s cancer drug?

The debate centers on the Novartis drug octreotide (Sandostatin). Given by injection, it is used to control symptoms caused by excess (tumor) secretion of the hormone serotonin, such as fatigue, nausea and gastrointestinal dysfunction. It is not felt to be a disease modifying agent.

Here are some of the pertinent facts:

The writer’s mother has a rare form of cancer called carcinoid. It’s not a well-understood disease and doctors disagree about its treatments. The rarity of the disease makes it hard to study outcomes.

Octreotide comes in two forms—a short-acting version that must be taken daily and a long-acting form that is taken every two weeks. The essayist made it clear that his mother was taking the long-acting version—which is expensive but convenient. He also correctly said that the drug was used for symptom control rather than control of the cancer itself.

A literature search led me to comparative studies between the two forms of the drug. There were no significant differences in efficacy or safety. The National Cancer Institute called the long-acting version of Sandostatin a “patient favorable formulation.”

Discovering these facts (dubious evidence for benefit and the presence of a less expensive alternative) allows one to see the problem from others’ perspectives.

One view is that of Humana: Is it wrong that third-party payers scrutinize the evidence for benefit before enriching the Novartis’s of the world? It is about value. If a short-acting version of the drug is equally effective, who should we ask to pay for the convenience? I know; writing that sounds awful, but the simple fact is that a decision on the cost of convenience has to be made–by someone.

(I called two pharmacies and learned that long-acting octreotide is ten times more expensive than the short-acting version. Also, the short-acting version can be given IV or SQ, which means a patient on the short-acting drug need not endure painful daily IM shots in the backside.)

Another perspective is that of the healthcare system as a whole. Why does long-acting octreotide cost so much? From my smartphone, I learned that the long-acting version is the exact same drug coated with a common polymer. In other words, it’s the same drug reformulated in a different package. Yes, it is surely a more convenient delivery system, but it is also one that allows Novartis to keep charging as if it’s a novel brand-name drug.

Now it’s time to look inward at ourselves—as Americans. As this LA Times reaction piece points out, the biggest misconception of Obamacare is that it is government controlled healthcare. It is not. Obamacare purposefully left intact the power of for-profit third-party payers and drug companies. That’s because Americans could not stomach the idea of having a single-payer government-run system.

You see what happens. For-profit third-party payers are not going to pay ten-fold more for merely convenient drugs. And drug companies will keep reformulating old drugs to maintain their profit streams. They aren’t baddies; they are just working within the American system. They are responding to the pressures we put on them. The cardiology analogy here is with the novel anticoagulant drugs, such as dabigatran, rivaroxaban and apixaban. I used to think insurance companies were wrong to deny coverage of these drugs. But then I looked at the evidence and found these drugs perform 99% the same as warfarin–a drug that costs pennies.

I’m hardly a policy guru but I am smart enough to know that what ails the American healthcare system is much more than a convoluted insurance reform act.

The first and most fundamental step in making a patient well is seeing and addressing the real problem.


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