Dear Senator Scott:

I live in Clearwater, FL so I write to you today as an alert and engaged constituent.

You are an accomplished and admired American leader.  After volunteering for military service during the Vietnam era, you honorably served your country in the U.S. Navy as a radar technician aboard the USS Glover. You overcame significant social and economic obstacles to earn a J.D. from the SMU Dedman School of Law.

You are a former Chairman and CEO of one of the largest private sector health care corporations in America (Columbia/HCA).  You then admirably served two terms as Governor of Florida; and you now serve as one our two U.S. Senators from the Great State of Florida.

In fact, you have been recognized as a uniquely qualified American leader who ran the largest health care company in the world, and who cares deeply about the costs and quality of health care to consumers.

I tuned into watch and listen to Face the Nation (CBS) on March 31, 2019, eager to learn from your current perspectives on health care in America.

I was disappointed by your responses to Margaret Brennan’s questions about a renewed partisan focus to repeal the ACA (President Trump, March 26, 2019).  I was particularly concerned about your focus on drug prices as a key driver of excessive costs in our health care sector. While your observations contain some truth, you failed to disclose the background behind persistent high prices of ethical pharmaceuticals in the U.S.

On April 1, 2019, you were interviewed by Steve Inskeep from Morning Edition (NPR).

Mr. Inskeep attempted to draw out your unique expertise on some of the most critical issues facing our nation relative to our health care delivery system, noting that ‘President Trump says he wants Republicans to be known as the party of health care’.

You zeroed in on high prescription drug costs, and you cited a bill you are introducing, the “Transparent Drug Pricing Act” which aims to stop drug companies from charging more for medication in the U.S. than in other countries.

In both cases, you responded to some solid direct questions with sadly incomplete ‘softball’ answers.

I did not hear you mention the “non-interference” clause of the Medicare Modernization Act of 2003 which is frequently cited as the core reason for excessive drug costs in the U.S.

Medicare accounts for more than 25% of annual national retail prescription spending, and taxpayers currently pay nearly 70% more for drugs in the Medicare program than through the Veteran’s Administration, which has direct negotiating power with drug companies.

The Medicare Modernization Act of 2003 precludes the Secretary of Health and Human Services (HHS) from negotiating directly with drug manufacturers on behalf of Medicare Part D enrollees. A simple act of Congress, supported by the executive branch, can repair this problem quickly.  In fact, a recent survey conducted by the Kaiser Family Foundation shows that over 90% of the public believes that allowing the federal government to negotiate drug prices for Medicare beneficiaries is needed.

As a highly accomplished expert in the field of health care, you are certainly familiar with a comprehensive study conducted by researchers at Harvard Medical School which examined peer-reviewed medical and health policy literature from January 2005 to July 2016. The study was published in the Journal of the American Medical Association (August 23/30, 2016, “The High Cost of Prescription Drugs in the United States”).

Their research studied scholarly articles addressing the sources of drug prices in the United States; examined the justifications and consequences of high prices; and investigated possible solutions for the pharmaceutical price conundrum we continue to face in America.

This independent professional research concluded that high U.S. drug prices are the result of U.S. government protected monopolies granted to drug manufacturers, combined with coverage requirements imposed on government-funded drug benefits. They noted that the most realistic short-term strategies to address high prices include:

  • enforcing more stringent requirements for the award and extension of exclusivity rights;
  • enhancing competition by ensuring timely generic drug availability;
  • providing greater opportunities for meaningful price negotiation by governmental payers;
  • generating more evidence about comparative cost-effectiveness of therapeutic alternatives; and
  • more effectively educating patients, prescribers, payers, and policy makers about these choices.

Individuals in the U.S. are directly impacted by the cost of prescription drugs at the retail level, whether fully covered by their insurance provider; through a co-pay; or fully funded out of pocket.

Indirectly, each taxpayer in the U.S. helps to subsidize the cost of prescription coverage for current and retired local, state and federal government employees; veterans; and those of our neighbors who are eligible for Medicare/Medicaid benefits.  When drug prices are inflated due to a lack of appropriate government regulation, U.S taxpayers are subsidizing excessive profits which accrue to executives and shareholders of pharmaceutical companies.

It is – and has been – clear to me that our elected officials in Congress have failed the people of the U.S. over a rather long period of time.  Our elected representatives have failed to address the root causes of high drug prices which have been identified and delineated in (the previously cited) independent and non-partisan report published almost 3 years ago.

Senator Scott, I believe the great majority of my fellow Floridians join me to expect much more of you in this arena.

We count on you — A recognized expert in the field of health care — to give us the full, honest and unvarnished picture on these issues, and to support new and appropriate legislation which strategically addresses the rapidly changing operational landscape on which our economy and society operates.

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The Ultimate in Irony?

February 3, 2014

A stated primary purpose of the Affordable Care Act is to ensure that all Americans have access to affordable health insurance.

Over the past 2 years, we’ve watched and heard elected officials at various levels of government fabricate stories to try and convince us that having a government-legislated mandate which gives us access to affordable health insurance is bad.

The Westchester Medical Center in Valhalla, NY is a “NYS Public Benefit Corporation.” As such, it serves as a regional healthcare referral center, mandated to provide high-quality advanced health services to the residents of the Hudson Valley and the surrounding area, regardless of their ability to pay. WMC also serves as an academic medical center involved in research and education that enables advanced care and prepares future generations of physicians.

According to a report published in April 2012 in The Journal News, the medical center spent $11.8 million in 2010 to compensate 44 executives, with Michael Israel, the CEO, at the top of the list at some $1.4 Million.

Now, in a Kafkaesque twist, this over-compensated CEO of a public benefit health care provider has proclaimed they will not accept any coverage plans offered through the NYS health care exchange! (The Journal News, February 2, 2014).

The Journal News has done an admirable job following and reporting on the perpetual shenanigans which seem to plague Westchester Medical Center. Yet, leadership at WMC seems to continue to ignore the reason they enjoy the benefits of public subsidies from the local, county, state and federal governments.

Here it is: the ultimate Catch-22:

1. You have insurance.

2. The Public Benefit Corporation which was created (and continues to exist) to, “manage a health care system which will provide health care services and health facilities for the benefit of the residents of the State and the County, including to persons in need of health care services who lack the ability to pay..” won’t accept your insurance.

Folks, you just can’t make this stuff up!

Health Insurance Reform

April 13, 2011

Each year in the fall, employees in my firm receive several communications relating to our “Open enrollment period” which is when we can pause and review our selection of benefits, and adjust them based on our own personal current situation.

The paucity of group health insurance options available to me which meet my needs led me again to select UnitedHealth, and they do provide a good array of benefits.

UnitedHealth is a big company. They insure about 33 Million people, and they are the largest health insurer based on revenue, which hit $94.16 Billion in 2010, with reported earnings of $4.63 Billion.

Rising costs (perhaps combined with careful attention to detail and some ‘enhanced cost-sharing’) caused my personal contribution to medical insurance coverage (for my wife and me) to increase by 24% from 2010 to 2011 – from $275 per month, to $341 per month.

Now, don’t misunderstand my position.

I’m glad to be working for a great company which not only pays me to do something I enjoy, but also offers a company-subsidized health insurance plan.

It is my understanding that my contribution is about one-third of the retail rate for this insurance, i.e. if I were retired and continued coverage under the plan, I would be paying about $1,023 per month, or just over $12,000 annually.

That’s a lot of money!

I just read that UnitedHealth Group Inc.’s CEO — Stephen J. Hemsley — received compensation totaling $10.8 Million in 2010, up from $8.9 Million in 2009.

About $1.3 Million of his compensation was salary, which remained unchanged for the fourth straight year. But his performance-related bonus jumped by 74 percent to $3.4 Million in 2010. The value of his stock and options also rose.

He is probably worth every penny of that to the shareholders of UnitedHealth, but not to me.

I would like the option to select from at least one, not-for-profit, public benefit corporation to provide for my health insurance needs. No dividends to pay out to shareholders. No big bonus to the executive team. No stock options to key employees.

When I was younger, we had Blue Cross and Blue Shield. These entities were organized as tax-exempt (not-for-profit) health insurance providers, and I recall being generally pleased with both the cost and the coverage provided.

When President Ronald Reagan signed the Tax Reform Act of 1986 into law, the federal tax exemption for these organizations was eliminated, helping to pave the way to where we are today.

Presently, we are hearing sound bites from Rep. Paul Ryan of Wisconsin and others telling us that they have solutions.

>>> Repeal the “Obama Care” legislation & make significant changes to both Medicare and Medicaid.

Great ideas, but before we repeat the apparent mistakes baked into the Tax Reform Act of 1986 — and possibly other examples since — let’s stop to take a look at what other options might be available to address two important outcomes: (1) reducing costs; and (2) improving outcomes.

I know of two really great things that happened in 1918.

The best was that my Mother was born on November 28. She lived to be 92, sadly leaving us on February 26, 2011.

The second best contribution from 1918 was the creation by Anna M. Harkness — a pioneer female philanthropist — of The Commonwealth Fund, “to enhance the common good”.

The current mission of The Commonwealth Fund is “to promote a high performing health care system that achieves better access, improved quality, and greater efficiency, particularly for society’s most vulnerable, including low-income people, the uninsured, minority Americans, young children, and elderly adults”.

The Commonwealth Fund has commissioned plenty of research on health care and health insurance. As a not-for-profit, public benefit entity, we expect this research is factual and unbiased, and completely outside the political process.

In one recent report, they tell us, “To achieve a high performance health system, health reform must go beyond ensuring affordable coverage to addressing health system changes that will improve outcomes and the quality of care, increase efficiency, and slow the growth in total health system costs.”
http://www.commonwealthfund.org/Content/Publications/Fund-Reports/2010/Sep/Analysis-of-the-Payment-and-System-Reform-Provisions.aspx

We can’t deny that Rep. Paul Ryan is a brilliant guy. Yet, I’m puzzled by his contention that his budget proposal fulfills a moral imperative “to lower Medicare-related costs”.

As he has structured it, overall health expenses would actually increase because people would be required to get care through private plans, which have been proven over and over to cost more than the current system. Seniors and others on fixed or limited incomes would be left to pick up the extra costs.

Ryan’s proposal apparently would convert our current fee-for-service system—in which patients go to any doctor that takes Medicare—to one in which beneficiaries would get a capped annual subsidy to help them purchase private insurance.

Critics of Ryan’s proposed system – some call it a “premium support” model — say it is really just a voucher system where elderly, disabled and otherwise disadvantaged people would appeal to private plans for services.

A great deal of truly objective and non-partisan analysis is needed here before we get into an even more emotional and politically charged debate.

The real question is: Do we possess the decorum, civility and intellectual curiousity to allow for an impartial analysis? Or have we crossed over into the War of the Roses, where no one really knows why we are fighting, but we know which side we are on, and we need to win!