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A Closer Look at AHIP’s Claims

May 26, 2016
This morning, in a letter to the editor of the New York Times, Marilyn Tavenner, President and CEO of America’s Health Insurance Plans (AHIP), attempted to lay the blame for higher healthcare costs and insurance premiums at the feet of America’s cutting-edge biopharma companies.

AHIP has been peddling these falsehoods and misinformation for years.  Tavenner’s (and her organization’s) claims are—at best—uninformed. At worst, they are outright distortions deployed to hide the facts from patients who are paying more for less coverage—all while insurers see record profits and sit on excessive reserves.

The facts are right in these companies’ own rate justifications—and in contrast to Tavenner’s own claim—three-quarters of insurance premium growth attributed to health spending is directly driven by spending on hospitals and doctors, not prescription drugs, like AHIP would have you believe. In fact, in 2015, the net price for branded drugs increased only 2.8 percent on average while premiums recently increased 6 percent and prescription copays for preferred brands increased 4.7 percent.

And yet, instead of increasing access to new, innovative drugs that can cure diseases and keep patients out of the hospitals, Tavenner’s member companies have sought to keep these cures out of the hands of patients. They’ve created specialty tiers that keep certain innovative and even generic drugs out of the hands of patients. As a recent New York Attorney General investigation uncovered, patients have been forced by insurers to choose between paying tens of thousands out-of-pocket for a drug that can save their life or waiting for treatment until it’s almost too late.  These same insurance companies even oppose biopharma patient-assistance programs that help patients fill the gap caused by these discriminatory insurance policies.

Americans pay for their health insurance with each paycheck - every week, every month, every year – and when they get sick – they expect for their health insurance company to pay for the medicine they need to get better.

All the while, health insurance companies are more profitable than ever. Since the Affordable Care Act was implemented, the stock market performance of the 5 largest insurance companies far outpaced the 5 largest pharmaceutical companies. That’s why some of the nation’s largest insurers—UnitedHealth and Humana—saw their net incomes double since 2008.

But it’s still not enough for insurance companies. Instead of lowering premiums or increasing coverage, many of America’s health insurers hold billions of dollars stockpiled in reserves. And yet, they’re currently suing the federal government to get their hands on increased amounts of taxpayer money.

Our industry welcomes a discussion on solutions to increased healthcare costs. Earlier this year, we released the first-ever set of systemic, industry-endorsed principles on the value of pharmaceuticals. We remain committed to not only delivering innovative cures to patients today, but also ensuring that the next generation of medicine is on the horizon for tomorrow.

But we cannot do it alone. It’s time for the insurers to come to the table and engage in an open and honest dialogue.