On July 11 2016, President Obama became the first sitting president to publish an article in JAMA, the distinguished Journal of the American Medical Association. Even though JAMA carefully positioned the article as a “Special Communication” there has been some debate about whether the article meets the tests of scholarship merited by such an august publication. The article is a tale of two halves: the first half, a summary of the progress and impact made by the affordable care act and the second half, a to-do list of much-needed improvements to PPACA implementation. The merits of the law will continue to be debated for decades. But in the spirit of peer review, there are a couple of things that stand out:
Renewed But More Targeted Advocacy for the Public Option
First, on page E5, Mr.Obama implores that “more can and should be done to enhance competition in the Marketplace”. It looks like the Justice department got that memo, and in time to start blocking the proposed Anthem-Cigna merger. This makes sense given the merger will lead to a 9%-15% reduction in competition and plan choice across the nation. The President renews the push for a public option in order to stimulate competition. Although the public option was initially considered during the legislative phase of the Affordable Care Act, the President here targets the implementation of the public option only in markets where only 1-2 insurers operate. This presents a nuanced and cautious (some would say typical) approach to expanding the government’s role in shaping the insurance markets. And the proposal is noticeably less ambitious than that of the democratic nominee hoping to succeed him.
Missed Opportunity to Emphasize Prescription Drug Related Proposals in his 2017 Budget
Given the forum and the opportunity to underline his 2017 budget priorities, it is a little surprising that the President chose not to make a more robust case for what is a pretty comprehensive set of proposals to curb prescription drug costs. In the article, the details are reduced to a brief exhortation to Congress to “act on proposals like those included in my fiscal year 2017 budget”, made mid-page on the last page of the article. Let’s quickly highlight what the President choose to summarize as such:
- Provide Medicaid-level drug rebates for brand name and generic drugs provided to Medicare beneficiaries who receive Part D low-income subsidies, beginning in 2018
- Accelerate manufacturer Medicare Part D “coverage gap” discounts from 50% to 75% beginning plan year 2018
- Authorize the Secretary to negotiate Part D prices for high-cost drugs and biologics with manufacturers.
- Increase the availability of generic drugs and biologics by authorizing the Federal Trade Commission (FTC) to stop companies from entering into “pay for delay” agreements
- Encourage the use of generic drugs by Part D low-income subsidy beneficiaries by lowering copayments for generic drugs and increasing copayments for branded drugs
Perhaps Mr.Obama realizes that none of these proposals are likely to get a vote in Congress. Nevertheless, we are surprised that these proposals haven’t received a more vigorous PR effort even if the current presidential election cycle leaves little oxygen for a discussion of policy proposals.
Still, with drug costs continuing to receive attention, it is not inconceivable that some of the ideas put forth by the President in his article will be adopted by the future President. Regardless, they will need to be examined more closely given the far-reaching impact on manufacturer drug pricing and patient out of pocket expenses.
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