As chair of an action network progress tracking group, Dr. Samuel Nussbaum has been busy tracking the progress of alternative payment models for health care payments. Dr. Sam, as he is known informally, claims we are in the best of times and worst of times, citing unprecedented advantages such as mapping the human genome. But despite one of the greatest achievements in the history of human exploration and extraordinary medical breakthroughs, despite the thousands and thousands of drugs under development which are the fruits of basic research, many of which were government funded, we have created a healthcare system that scientifically, in terms of delivery and accessibility, has been less than socially responsible.
“People can’t afford the cost of drugs. Over the past decade the average wage has not changed, but look at the cost of healthcare!”
Dr. Sam points to the populist enthusiasm for Bernie Sanders and Donald Trump. During their primary campaigns, both capitalized on the type of anger that is the natural outgrowth of this dilemma, he said.
Sharing insights gained from 15 years as executive vice president and chief medical officer of Anthem, Dr. Sam ticked off the issues. We’re spending more, and through the Affordable Care Act, a.k.a. Obamacare, there’s better access. But spending on other services that also play a vital role in health and wellbeing is down—public health, mental health, dental care, education, housing, and the list goes on.
“We stole from other investments to increase access. We are not using our trillions wisely,” he claims. “Thirty to 40 percent is wasted on poor services, admin costs, fraud, etc. Obama tried to introduce reforms, to deliver care differently and provide more integration and coordination of care. But pharmaceuticals remain front and center. Chronic illness treatment is all about drugs. Granted, there have been extraordinary strides made toward cures and better management of chronic illnesses, but this comes at a cost. In 2015, health care spending topped $3 trillion. Twenty-five percent was spent on drugs, particularly specialty drugs,” he said, emphasizing how much more of the healthcare pie is being taken by pharmaceuticals than in the past.
People want price controls, Dr. Sam reminded the audience. Seventy-five percent of the American public believes the drug companies are taking advantage. The USA pays the highest prices for drugs. The pressure is building, and it’s playing out in the 2016 campaign.
Donald Trump claims the drug companies are lobbying the politicians and that’s why costs are exorbitant. Clinton is adjusting her opinion, borrowing from what worked for Sanders during his campaign. With the pressure on and the public outcry growing louder, Nussbaum said Congress can be expected to act, regardless of who wins the presidency.
Will the ongoing reform of US healthcare now start borrowing from the single payer model? According to Dr. Sam, “Unless we find a way to solve this ourselves, there will be increased regulation. We need to figure out these new models of value. Few want price controls because it hampers innovation. We need financial incentives that provide an engine for innovation. But egregious price increases are driving political blowback.”
Concerning the election, with Clinton, Nussbaum expects there will be a continuation of alternative payment models and cost controls, including less than full access to all drugs. As for Trump, he is quick to condemn Obamacare and threatens to repeal it. But Nussbaum also reminded the audience of Trump’s son-in-law, real estate entrepreneur Jared Kushner, whose brother Josh is co-founder of Oscar Health, a health insurance company that, as a licensed health care provider, sells to individuals and families in the marketplaces created by Obamacare. Perhaps, he suggested, the real differences in healthcare policy between Clinton and Trump might not be so great post-election.
Nussbaum currently serves as a strategic consultant to EGB Advisors, Inc., consulting arm for Epstein, Becker & Green, where he advises life science companies, hospitals and health care systems, and physician and provider organizations.
**Footnote: Dr. Samuel Nussbaum was the Conference Keynote at the 2016 ASAP BioPharma Conference.