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Time for AHIP to Finally Join Us And Work Toward A Solution

June 20, 2016
I worked as an elected leader in government for 24 years. One of the enduring lessons I learned is that to accomplish big things, people from different backgrounds must come together and unite behind a common solution.

When that happens, our nation flourishes. And those problems that once seemed deep and complex, suddenly don’t seem so insurmountable anymore.

That’s why it was so disappointing to hear America’s Health Insurance Plans’ (AHIP) ridiculous claim that my organization (BIO) refuses to work with them to reduce healthcare costs for all Americans.   If they had bothered to read my published remarks, they would have seen that I expressly called for all of us – insurers, drug makers, patients, doctors, and policy makers – to sit down and develop win-win policy solutions that will increase the access and affordability of innovative medicines.

Indeed, BIO asked AHIP months ago to work with us on constructive solutions, but AHIP still has not agreed to do so. Our offer still stands…and will continue to.

But for now, it seems the insurance industry would rather discriminate against patients, rake-in record profits, and send press releases demonizing innovative biopharmaceutical cures and therapies than work in good faith to ensure that patients who need medicines can get them.

The fact is that insurers discriminate against the sickest among us. For example, a 2015 Harvard study found 12 plans on the Affordable Care Act (ACA) marketplace discriminated against HIV patients—causing them to pay $3,000 more annually than patients in other plans. The following year another Harvard analysis found “there is increasing evidence that some [health plans] are structured to make specific medications, such as HIV and HCV medications, disproportionately expensive.” It went even further to say that “this insurance practice has the discriminatory effect of discouraging individuals in need of specific medications from enrolling in these plans or of shifting the burden of the cost back to these enrollees.”

But these studies aren’t a shock to anyone who’s been following the news recently. In New York, the state Attorney General investigated insurance companies who deliberately avoided paying for lifesaving Hepatitis C drugs until it was almost too late. Blue Shield of California had its tax exemption revoked and was required to refund consumers $82.8 million after it was found they had stockpiled more than $4 billion in surpluses, but still raised premiums. The ACA may have barred insurers from excluding patients with pre-existing conditions on their plans, but they are certainly finding new loopholes to avoid having to cover sick people.

But that’s not where the misleading information ends. Even AHIP’s own companies admit drug prices are not driving the shockingly high premium growth we are now seeing. Digging into the insurers’ own data, three-quarters of the growth in insurance premiums, attributed to health spending, is directly driven by doctors and hospitals—not prescription drugs. In fact, IMS reported that the net price for branded drugs only increased 2.8 percent in 2015—that’s less than inflation and undermines the repeated AHIP claims that prices are out of control or rising excessively. Indeed, it’s less than the average premium increases, and less than the average growth in co-pays that insurers use to put more of the burden of drug costs on their covered patients. Yet in spite of the facts and the data, AHIP keeps spewing these falsehoods.

AHIP and BIO may have different points of view and represent different industry segments, but I hope we can work toward the same goal of improving patient access to the medicines they need. BIO is committed to figuring out how we can lower healthcare costs and ensure access to lifesaving cures and therapies for all patients. That’s why, earlier this year, we released the first-ever set of systemic, industry-endorsed principles on the Value of Biopharmaceuticals, reflecting our industry’s commitment to do just that. We’re ready to roll up our sleeves and work with all parties. But we can’t do it alone.

It’s time for the health insurance industry to sit down with us and work together on a solution.