The GOP's Socialized Medicine: Corporate Drug Fraud
While President Bush and his GOP allies are railing against the specter of socialized medicine and the high cost of the SCHIP program, the Bush administration has done relatively little to crack down on billions in corporate drug fraud that bilks our government health programs, as noted in my article this month in The American Prospect, "Medifraud Amok." These fraud schemes have led to $5 billion in settlements and fines in the last eight years, but experts say there are billions more that have been stolen by the drug industry -- but the Bush administration has allowed the industry to get away with fraudulent overcharges, destroyed prescriptions, resending returned drugs and other scams -- all while complaining that spending to insure lower-income kids ineligible for Medicaid is too expensive.
(If you're angry about such hypocrisy, go to the websites of groups like Families USA [and see their SCHIP TV ad they're seeking to place in key states] ,and the Children's Defense Fund to see how your legislators voted, so you can get the information you need to lobby your member of Congress to overturn the president's veto on SCHIP.)
Meanwhile, a knowledgeable Justice Department official told me: "Starting in 2002 there was a conscious decision that the pendulum had swung too far towards health-care fraud enforcement. The investigative and regulatory agencies are less supportive of making the cases and more supportive of drug industry arguments."
Of course all the claims made by the GOP and Bush that the SCHIP program will primarily help families earning $83,000 a year and children who are already well-served by private insurance are a concoctions of lies, fabrications and exaggerated half-truths, as the Center on Budget and Policy Priorities points out. For starters, the $83,000 families would only be covered if an exemption is granted to one state, New York, that's made an application to extend such coverage as a way to cover moderate income children without health insurance, but hasn't won approval yet. I underscored these WMD-style whoppers in an article in In These Times: "In fact, the proposed expanded SCHIP program would primarily reach uninsured kids who are already eligible for either SCHIP or the even more restrictive Medicaid program. Indeed, currently nine out of ten of those now enrolled in SCHIP are in families that earn below 200 percent of the poverty line." (Here's a detailed debunking of the administration's SCHIP claims, based on the Senate bill that became the basis for the final legislation.)
But the administration has no problem in creating boondoggles for drug companies in exploiting Medicare and Medicaid that are the GOP's version of socialized medicine -- for drug industry CEOs.
All this alleged or admitted fraud goes way beyond the overpricing that's commonly acknowledged as a major factor in exorbitant health costs. Yet's there's $60 billion in potentially reclaimed fines and settlement payouts from drug companies waiting to be collected -- but the under-funded Justice Department's enforcement of fraud claims has led to a backlog of 180 pending whistleblower lawsuits.
As a press release summarizing the article points out:
The American Prospect:Lax Bush Administration Allows Billions in Corporate Drug Fraud
Justice Department insider tells magazine: Agencies hampering enforcement, "supportive" of drug industry.
Washington, D.C.-- Investigative journalist Art Levine reports in the October issue of The American Prospect that key Bush administration agencies, including the Justice Department and Health and Human Services (HHS), are failing to effectively monitor, prevent, and punish an epidemic of drug-industry fraud.
Accused of such schemes as illegally marketing drugs for off-label uses, reselling drugs returned in the mail, and improperly switching patients to drug capsules that cost as much as 17 times more than cheaper tablets, the drug industry has paid out at least $5 billion in fines and settlements in the last eight years. But leading drug companies and little-known pharmaceutical management "middlemen" companies have apparently succeeded in looting billions more from Medicaid and Medicare programs that aim to serve the poor, elderly, and disabled, according to current and former prosecutors, attorneys for whistleblowers, and Congressional watchdogs.
At the same time, under-staffed Justice Department anti-fraud prosecutors and attorneys face a backlog of 180 federal lawsuits alleging false claims by drug companies. The suits represent a potential recovery of $60 billion in funds to federal government and state Medicaid programs. Additionally, a knowledgeable Justice Department official tells The American Prospect: "Starting in 2002 there was a conscious decision that the pendulum had swung too far towards health-care fraud enforcement. The investigative and regulatory agencies are less supportive of making the cases and more supportive of drug industry arguments."
The article, based on dozens of interviews and a review of hundreds of pages of legal documents and testimony, offers the first major overview in a national magazine on the wide range of drug-industry fraud. It also sheds additional light on alleged abuses by "Pharmaceutical Benefit Managers"(PBMs) that act as all-purpose middlemen between drug companies and the insurance plans and Medicaid programs that contract with them. Levine's article looks at how dozens of lawsuits by federal and state governments, along with HMOs, corporations, and unions, have charged the PBMs with a wide range of fraudulent and unethical practices; these allegedly include secretly retaining manufacturer rebates that were supposed to go to clients, and reselling returned drugs.
Rep. Henry Waxman of California , whose oversight committee has led Congress in investigating drug fraud, tells The American Prospect: "We have failed the taxpayers if we allow these dollars that were intended for prescription drugs to be stolen or wasted, and we also let down the elderly, the poor, and disabled who need these medications."
Why aren't Democrats scoring more points on this issue while trying to build support to override the President's veto of SCHIP?
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The thing that does concern me, is if we do come up with a socialized program, and they just pay the bills dished out by the drug companies, and the health care industry, we are going to get fleeced.
I read one person's post where they said the government is keeping the prices high, buy awarding patents for lengthy periods of time, and helping the drug companies drive out they're competition.
I loved Sicko, but lets look at how it pointed out Nixon created the HMO system by a government mandate. Has anyone thought of examining what Nixon did to create the HMO system and getting rid of it?
http://www.lewrockwell.com/paul/paul339.html
If the discussion is about how to provide medical care to everybody then the idea of purchasing insurance is a non-sequiter. Government is social insurance and its holdings are our collective holdings. The problem is that allowing the government to pay doctors(through a government corporation, run by doctors, nurses and some crackerjack auditors)and fund hospitals is so efficient, it undermines a large sector of our current economy. Fortunes would be created and lost overnight. The power of the people as expressed through their common stewardship of their common destiny is everywhere and always a threat to those who produce no labor yet reap its rewards.
Medicare part D is really disturbing. Although much has been said about the Donut Hole, the program has no caps on coverage. Unfortunately, I take medication for HIV and it costs $17,000 annually just for three pills a day. As long as I vow to stay in poverty, I can get my meds for almost nothing. I know other less responsible people who are more thrilled they can get their Steroids and Viagra and other recreational drugs on this program, and don't seem very concerned about the meds that actually save their lives.
why does george bush hate poor sick children?
check out chris weigant's friday talking points at huffpo:
http://www.huffingtonpost.com/chris-weigant/friday-democratic-talking_b_67388.html
The closing question posed in this blog, why aren't Democratic candidates trying to score points with this one & increase votes to override the veto, is a good one.
My guess is that it would turn off contributions from Big Pharma & the insurance industry vandals who've enjoyed soaking the American taxpayer/worker for . . . ever.
And the old bug-a-boo about socialized medicine is soooo arcane. I mean, really, who still falls for that shit -- someone who longs for the good old days of the 19th century or a country that resembles Mexico? Gimme a fuckin' break!
Democratic candidates need to get their heads out of their asses and come into the 21st century like the majority of us who want universal GOVERNMENT administered healthcare -- not some back-asssward excuse for taxpayer subsidized corporate welfare like the current system run by the insurance industry mafia.
Hillary -- fuck you & your plan.
Edwards -- nice try, but your whining is a turn off.
Obama -- get on board, if you want a chance, 'cause the train's already left the station.
"Socialized medicine' is the hammer used by politicians and right-wing journalists to blunt enthusiasm for a Medicare-for-all or single-payer universal healthcare vision.
There is a huge difference between 'socialized medicine' and 'single-payer'. President Bush and Congress enjoy 'single-payer' healthcare --- healthcare paid for primarily by the federal government through taxes. Military personnel and their families enjoy single-payer. Our Seniors enjoy single-payer. Medicaid recipients enjoy state-run single-payer. The V.A. is a single-payer system. Native-Americans have the Indian Health Services as a single-payer. If we combined all of these populations segments and added the privately insured population, we could have a universal single-payer healthcare system with even greater economies of scale and benefits.
Socialized medicine is the government takeover of the means of healthcare delivery. In this scenario, government would pay salaries to physicians, nurses, administrators, therapists, technicians, etc. and own the hospitals, long-term care facilities, clinics, etc. This is the British model. It requires government takeover of the brick and mortar, personnel, and logistics of the system.
Single-payer universal healthcare is the funding of healthcare services ... delivered by privately-owned healthcare facilities and privately-paid healthcare professionals ... by government. It enables government to act as a centralized healthcare purchaser with the power and accountability system necessary to ensure universal healthcare access, enforce quality and patient safety standards, and take the waste, fraud, and abuse out of the current grub-fest we have now.
Once journalists and politicians are able to confuse the public and obscure the difference between "socialized medicine" and a single payer universal healthcae system ... as they have done for decades ... we are well on our way to retention of some form of the status quo aka insurance-creep, tax incentives, partial coverage for many, and a profit trough for industry special interests.
Cheney is the major stock holder in the largest US pharmaceutical consortium. And his drugs are the only approved drugs under Medicare which is paid for as a Social Security Benefit.
Why do some 200 million Social Security members put up with this Cheney chicanery?
Hillary's plan has an option where you can choose a single payer government run plan, which is what I would choose.
Go to her website and read it.
So, the Republican president has tax-payer supplied, socialised medicine, for him and his family, but says "no" to tax-payer supplied, socialised medicine for anyone else. Oh, right, he's a Republican.
No, the president is provided health care as part of his employment. This is the same way the 250M other people in the country get health care.
No, much fewer Americans get health care as part of their employment. According to the Washington Post, your numbers are way off:
About 177 million people had employer-based coverage last year, census figures show. That is 2 million fewer than at the turn of the century, even though the overall population has been increasing.
http://www.washingtonpost.com/wp-dyn/content/article/2007/09/11/AR2007091100666.html
In addition to what Blue Bellingham is saying, I think you're wrongly assuming that people without healthcare don't have jobs. That's not true. They do have jobs.
This is not to mention those who have problems having claims paid by private healthcare.
As for the president, however he gets healthcare, it's NOT by a private company.
Every member of Congress, and the President get life-time, 100% covered Medical Insurance. It is paid for by taxpayer money, administered by the government.
It IS socialized medicine. They get it because they are better than you.
The thing that does concern me, is if we do come up with a socialized program, and they just pay the bills dished out by the drug companies, and the health care industry, we are going to get fleeced.
I read one person's post where they said the government is keeping the prices high, buy awarding patents for lengthy periods of time, and helping the drug companies drive out they're competition.
I loved Sicko, but lets look at how it pointed out Nixon created the HMO system by a government mandate. Has anyone thought of examining what Nixon did to create the HMO system and getting rid of it?
http://www.lewrockwell.com/paul/paul339.html
We are getting fleeced now you fool!!!!
The governement is keeping prices high? Are you kidding me? The government pays a doctor under medicare $300 for breast cancer surgery and 90 days of follow-up.
I'm sorry, but you would pay a plumber more than that for his services.
As a result, 95% of doctors refuse medicare.
We have to stop the fraud in the health care system including medications.
The government pays a 12% subsidy to the private insurance plans that participate in Medicare so they can out compete Medicare. The first thing to do is to get rid of the subsidy and let those plans compete on their own if they can.
"As a result, 95% of doctors refuse Medicare."
They might refuse some of the private insurance plans but very, very few will not take Medicare unless they have been caught trying to bilk Medicare and are no longer eligible to accept it.
I chose the direct Medicare plan (no private insurance companies), have yet to find a doctor
or hospital who wasn't happy to accept it although many doctors do not accept some of the private plans.
Do not be concerned. Medicare is not paying all the bills, for example, without evaluation. It evaluates cost, price, reimbursement rates, and often necessity of a procedure. Medicare carriers, moreover, are often also private healthcare insurance companies. There is a system in place that works. What needs to be finetuned, for doctors mainly, is payment schedules, which have not been adjusted for inflation for a decade or so, I think. It may be a function of total funds available for reimbursement. That, too, can be addressed with universal healthcare. If, today, the average American pays $ 1000.--/mo in healthcare, plus an additional percentage of the takehome pay to Medicare, a different division of percentages could be come up with, with a larger percentage appropriated for Medicare, and the outcome would STILL be a much lower monthly insurance premium for (universal) healthcare, and with full coverage, and no dropping of patients, refusal of necessary procedures, inability to work, because of inability to get healthcare insurance, etc. Insurance companies make billions and billions of dollars in profits which are siphoned out of healthcare and into something else (such as private wealth). IF in The Netherlands the healthcare premium is Eu 90.-- (about $ 115.- depending on the exchange rate), a similar amount in the U.S. for healthcare coverage - and it does not need to be, or be called, taxes - plus the Medicare premium, which is a tax, would still be a fraction of what Americans pay now, and there would be coverage and security. With just a little in addition we could also improve the healthcare infrastructure in the U.S. D onot forget that today, having healthcare insurance and paying your premium on time and in full does NOT NECESSARILY MEAN YOU ARE COVERED. People WITH HEALTHCARE INSURANCE regularly have to declare bankruptcy. Some at the beginning of their adult lives.
Is there anywhere in this a country a federal program or an agency that is not worse off right now than it was 7 years ago?
Unbelievable.
I work for a drug company. It is immensely profitable despite paying a boatload of money to market its drugs...and the vast bulk of the profits come from the US market where because of lobbying efforts by the industry and a misinformation campaign by the Bush administration, the Federal government doesn't negotiate better prices for senior. Other countries (sensibly) negotiate with drug companies (as the purchasers of the drugs) to get good prices...the industry bitches about pricing in Europe, but still makes fantastic profits (albeit less than they make in the US).
And don't believe all that phony stuff about research spending...the industry spends far more on its sales forces than it does on research, and much of the research budget is spent on drugs offering few if any incremental benefits over generics. Of course, some of the drugs do have clear benefits for patients, but most new agents have really minor points of differentiation done against specially selected competitors to give the appearnace that the drug is better...in some cases the new drugs are actually less effective than generics.
America needs to rellok at its health care policies.
One of my clients was a drug salesman for Astra Zeneca, selling mostly cancer drugs to oncologists.
She was able to afford to buy several homes including oceanfront property and took vacations to Europe frequently. Her friend told me that she made 300k a year at least. That partially explains why these cancer drugs are so exorbitantly priced.
Anecdotal evidence means nothing. Let's look at the numbers.
AstraZeneca had $26.4B in sales last year, their net profit was $4.3B, for 16.2% net margin. They spent $4B in R&D (15.3%).
AZ actually has some pretty solid net margins for a drug company.
For the record, WalMart has around a 3% profit margin, Exxon around 8%, Apple around 11%, and Microsoft around 27%, Google around 28%. Other drug companies run around 10% too.
By and large, most drug companies aren't doing great in terms of the money they make. Yes, they make a lot, but they also spend a lot.
You always need to look at the net margin to attempt to try and decide if a company is making a lot of money (or not).
I suggest you read the following for more ammunition.
Medifraud Amok
http://www.prospect.org/cs/articles?article=medifraud_amok
"there is a backlog of 180 federal lawsuits alleging false claims about drugs by pharmaceutical companies, representing a potential recovery of $60 billion in funds to the federal government and state Medicaid programs. To drug companies, this slow pace of prosecution renders the possibility of fines almost hypothetical. Additionally, while prosecutors investigate, these cases remain "sealed," often for years, so the public doesn't know the number of repeat offender companies amid the hundreds of pending federal and state cases. This shortfall at the federal level is even more striking given that the federal government directly gets back an estimated $15 or more in reclaimed revenues, criminal fines, or civil penalties for every $1 spent in false claims act prosecutions."
The drug companies break the law as a matter of doing business and the Bush administration has adopted a policy of handcuffing federal agencies that are supposed to prosecute these illegalities by defunding them and minimizing their staffs.
The 60 billion in potential recovery for violating federal law would go a long way for paying for healthcare reform.
Most if not all of the research is done under federal grant by scientists. Almost none of the basic drug discovery is done by drug companies. They do final cosmetic type research.
Does anybody still get tricked by the GOP's "socialism" BULLSHIT? UNBELIEVABLE!
What have Republicans offered anyone lately except freebies for their UTRA-RICH CORPORATE WELFARE QUEENS PALS? Hahahahaaaaaaa...
You've GOT to be kidding.
WHEN will Americans wake up and stand up against the GOP bulldozer that's pushing USTaxpayer dollars out of USTreasury into pockets of WAR-PROFITEERS, BIG OIL and other opportunist pals of Bush-Cheney?
It's all about enriching the bottom lines, stupid!
When will Americans stop STARING and RUBBERNECKING with their dumb mouths hanging open?
How about ACTIVE PROTEST AGAINST THE rightwing CREEPS ruining America?
Do you need "more proof"?
Americans have been brainwashed into thinking PRIVITIZATION is GOD.
The Republicans have perpatrated the greatest scam in the history of the nation.
The Government programs are nothing compared to the looting that has occured by private industry. The Medicare Prescription Drug Plan is a HUGH SCAM.
Designed to confuse and rip off seniors. Seniors think it is wonderful because they are getting crumbs. They are Sooooooooooooooooo stupid. They could be enjoying a complete, less expensive benefit if it had just been run as a part of Medicare with NO insurance companies ripping them off and making 35% profits.
But the private sector does it BEST right.
What a bunch of brainwashed suckers we are!!
Any PRIVATIZATION program in a method of taking control away from a our constitutional government. And the most insidious Privatization industry is the Federal Reserve Bank (FED); the source of all the world's problems from financing wars to charging usury interest rates on credit cards for money the FED is allowed to print for free with no government control. Incredible but a fact.
Congress Granted the FED a charter in 1913 to act as a Central Bank... And the President or Congress has the Right to Rescind that Charter just as President Andrew Jackson did just before the Civil War.
"Why aren't Democrats scoring more points on this issue while trying to build support to override the President's veto of SCHIP?"
Healthcare fraud is the biggest systemic lunacy never discussed by Democratic Presidential and Congressional candidates.
Apparently, FRAUD is a politically incorrect word in politics. So, we won't discuss it:
http://oig.hhs.gov/fraud/enforcement/administrative/cmp/cmpitems.html#2
... because if we even allude to it, somebody might get upset:
http://oig.hhs.gov/fraud/cia/index.html
However, if folks are interested and have nothing to research for the next 20 years, they can always Google 'healthcare fraud' ... or if they are lazy, they can just tap into the work of others:
(Examples):
http://www.taf.org/schneider07drugreport.pdf
http://www.taf.org/
In any case, we need to take our cues from our fearless political leadership and not talk about it.
The Dems feed from the same trough as the Republicans.
They have their cushy seats, great health care.
Their job is to MAKE us think that they are for the people. BUT you really think they are going to REALLY stand up to the corporations that get them elected.
FAT F-ING CHANCE
What really makes me angry about the veto of SCHIP and the scare tactic of "socialized medicine" is that in the Medicare prescription drug program the repubs included an $86 billion bribe fund for corporations to pay them not to move retirees onto the medicare program.
We need to take the country back from these people!
That was a surplus in Medicare that The Bush gang gave to businesses to pay retirement insurance for their workers. He had no right to do that. He wanted to make sure there wasn't a pool of money for Medicare to use from.
They say that the Medicare advantage plans offer more benefits than the original Medicare combined with Medigap because money is given to the private insurer's Advantage plans from Medicare, so they can offer what the original Medicare doesn't. Someone tried to straighten it out and the private insurers advertised that Medicare was hurting the elderly by taking away benefits, so they quit.
They want everyone to be privatised and they are determined to bankrupt Medicare. Medicare wasn't started until 1963 and it was started by Johnson. Correct me if I am wrong on that.
"adversary relationship"
Excellent choice of words. I have always said that the insurance companies don't understand the concept of customer service, but rather treat the consumer as an adversary or enemy, and naturally so, as their goal is to make a profit something thaey can't do when paying out claims. "Socalized medicine"... ah the four letter word of American healthcare. Don't every think of uttering the word least we strike fear into the hearts of all Americans that conjers up the thought of becominig like the evil empire Soviets! Well, I'm going to say it "SOCIALIZED MEDICINE"! It's time has come and that time is now!
The Republican Party has established "managed" health care. Its a lie. Its Managed patients worse than any socialist or even communist system. These neo-cons allowed the Frisk family to write the rules and leech Medicare and folks with HMO contracts.
Thanks for pointing out the socialistic system these Corporate Republicans rule. American Health Care will continue to lapse behind most countries.
Corporations cannot deliver let alone improve our Health System.
I won't rest until the CEOs of some Big PhRMA companies do hard jail time along with the culpable PBM CEOs.
I intend to report this to the fraud hotline of the US Government Accountability Office (GAO) who may go after these criminals that our own, now totally demoralized justice department, is unable or unwilling to do.
I also will be writing to my US Congressman Patick Murphy (PA-8th) and my US Senators Arlen Specter and Robert Casey of Pennsylvania
I am appalled that health care dollars could be diverted from children into the pockets of these white collar,but high crime,executives.
PLEASE HELP IF YOU READ THIS-INDICT AND CONVICT! SHAME ON OUR NATION FOR ALLOWING THIS TRAVESTY TO GO UNPUNISHED.
Dr. Rick Lippin
http://medicalcrises.blogspot.com
I'm with you on this one, Dr.
thxs skyblue
Be Well,
Rick Lippin
Read the following article:
Medifraud Amok
http://www.prospect.org/cs/articles?article=medifraud_amok
The President of the United States is opposed to children getting medical treatment.. He was not saying no to all children, only those who need it. What a brutal system! Only a week ago, Medicaid said that it would no longer pay for chemotherapy for cancer patients who prove to be undocumented. America in 2007! . This is the guy who brought us the Social Security, Part D, Prescription Drug Scam. This plan allows the federal government to subsidize the drug companies a second time. The government pays a percentage of the cost, of these very expensive medications, which results in the retail price going even higher. The drug companies don't care who pays them, as long as they get the money, and they have found another way, of getting even more. As long as these Insurance companies are involved they will continue to rob us. Some people think that each of the Democratic candidates have a health care plan. They do, but they all protect the Insurance Companies, and keep them involved, except, of course Anti-War Candidate, Dennis Kucinich...A FREE, universal, single-payer, not-for-profit, health care system......Medicare for All!
Isn't there a Part C scam as well? Aren't insurance companies subsidized?
"The President of the United States is opposed to children getting medical treatment."
The "childrens do learn" that once they're born, their "protection" is no longer Bush's priority.
Bush used the first VETO of his presidency to "protect" 400,000 frozen throw-away embryos from Federally-funded Embryonic Stem Cell Research....
"This bill would support the taking of innocent human life," he said. "Each of these human EMBRYOS is a unique human life with inherent dignity and matchless value."
Bush will use the fourth VETO of his presidency to "Suffer the little children to come to me, for such is the kingdom of heaven".
Maybe he doesn't know that funding S-CHIP for one year is equal to 41 days of his war.
Apparently money used to HARM the human populace, rather than HELP, is money well spent?
Stay safe, healthy and happy,
Love, Loretta
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