These days, we’re used to shopping around and getting price information for just about anything within a few clicks! But, it’s not that easy with healthcare. Unlike shopping for clothes, food and most other professional services, it can be tricky to figure out how much different healthcare services cost, or which part of those costs you’ll have to cover out of pocket.
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“Did you know that health insurance companies that participate in federal or state programs also have stricter gross margin/profit caps on that business? For example, the Medicaid health plans in Louisiana have to pay state and local taxes, and they pay for all administration on 15 percent of the payments they get from the state for managing care of Medicaid patients.”
Drug Company Magic, Part 2
As we move further into 2017, I am increasingly concerned about the impact drug price increases have on your premiums. I’ve written before about the “magical” way drug companies arrive at their pricing.
There is no doubt that the advancement of medical technology is a very expensive business. Research into new drugs by the 10 biggest drug companies in 2013, for example, exceeded $66 billion in brand-new spending. That’s a whole lot of money that their investors and shareholders are willing to risk for the NEXT big drug. And this level of investment has actually been growing for about 20 years straight — even more so lately, as global capital is chasing its way into the United States looking for a strong return. A really strong target for this capital is the U.S. pharmaceutical industry.
The fastest-growing part of your health insurance premiums may not be immediately obvious to you. It’s not hospital costs or doctor’s costs or the cost of lab services, X-rays or surgeries. The answer is spellbinding…
By Michael Bertaut, Healthcare Economist
In Part 1 of this Blog on Hepatitis C, we looked at recent advancements in treatments and their costs, as well as the studies underway to determine how widespread the disease is. We learned that millions are infected, new prescription drugs are very effective and their costs sky-high.
