A patient suffering from severe pain and cirrhosis resulting from a chronic Hepatitis C viral infection is unable to purchase the recently developed drug Sovaldi, which costs $84,000, the same as a new Porsche 911. The patient could finance the Porsche, but not the hepatitis cure--even though curing hepatitis would result in lower lifetime medical bills, benefiting our healthcare system and society.
Gilead, the pharmaceutical company that developed Sovaldi, has been blasted for its seemingly outrageous price-tag. But in medicine, as in cars, you pay for what you get, and Sovaldi is the first and only cure for Hepatitis C or any other viral infection. It is 95 percent effective and has minimal side-effects. This is a significant advance on the 50 percent effectiveness rate of classical interferon treatments that lead to severe side effects, such as anemia, in a substantial percentage of patients.
Gilead is finding that many insurance companies, as well as Medicare and Medicaid, will not pay the high costs of Sovaldi. The cost of new treatments will push insurance companies to fund cheaper preventative measures, rather than operations and medications that offer cures. This is not the medical system Americans expected with the passage of the Affordable Care Act.
Already, several plans have cut costs by removing from their networks high-quality institutions such as the Memorial Sloan Kettering Cancer Center--voted the top cancer center in America over the past 25 years by U.S. News and World Report--and the Mayo Clinic--voted top hospital overall.
Many complex diseases and disorders, Hepatitis C among them, affect the poor more than the rich. It is not just the Affordable Care Act that does not require insurance companies to pay for the latest drugs. Medicaid and Medicare are also limited in the drugs they cover, with a "best price" clause that forces government to either pay 23.1 percent of the average price wholesalers pay manufacturers, or the best available market price.
Even though Gilead gives a 20 percent discount to Medicaid and a 40 percent discount to veterans, rules prohibit financial creativity on the part of the government. Agencies cannot pay for Sovaldi over time by giving Gilead bonds, cash, and other assets.
As society we have to address two fundamental questions. Do want to continue developing new, innovative, but often expensive therapies? Whose lives do we want to save using these new therapies, rich or poor? Private and government-provided health insurance programs are leading us to reduce innovations, hurting both rich and poor, but especially the poor. Just ask Hepatitis C patients.
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