The Obstacles to Real Health Care Reform: Private Insurers and Big PhRMA

Published on SteveLendmanBlog, by Stephen Lendman, August 21, 2009.

… Simply put, the obstacle to real health reform is the insurance and drug lobby’s stranglehold on Democrat and Republican administrations and Congress. Corporate lawyers draft new laws, sign-off on changes, and industry officials staff the FDA, CDC, and other related agencies, then return to high-paying jobs in the sectors they represent. Public welfare is unconsidered under a system favoring profits, so achieving real reform is near-nil. Whatever, if any legislation, passes, will make a dysfunctional system worse by rationing care, leaving growing millions uninsured, many others underinsured, while enriching insurers, drug companies, and large hospital chains …

… Predatory Drug Giants:  

Called Big PhRMA with good reason, they wield inordinate power over policies affecting their industry. Poorly tested new drugs are fast-tracked and only withdrawn after hundreds, often thousands, are harmed. Yet no congressional committee ever investigated a process endangering millions of lives because lawmakers reap huge campaign contributions regularly in return for industry-friendly legislation and regulations.

In January 1997, Rezulin got swift FDA approval to control blood sugar for patients with Type 2 (non-insulin-dependent) diabetes. It was only withdrawn in March 2000 after dozens of liver failure deaths were reported and many others found to be afflicted with serious, potentially life threatening damage.

In May 1999, the FDA fast-tracked Vioxx (the anti-inflammatory NSAID) despite suspicions at the time that Merck knew of dangerous side effects and marketed the drug anyway. Evidence later emerged that the FDA knowingly approved, promoted, and refused to recall it after as many as 100,000 heart attacks were reported and thousands of deaths.

Dr. Richard Horton, editor of The Lancet, said this after reading Wall Street Journal-published insider emails on how Merck hid damaging clinical trials evidence and sold the drug anyway:

“In the case of Vioxx, the FDA was urged to mandate further safety testing after a 2001 analysis suggested a ‘clear-cut excess number of myocardial infarctions.’ It did not do so. This refusal to engage with an issue of grave clinical concern illustrates the agency’s in-built paralysis, a predicament that has to be addressed through fundamental organizational reform….the FDA acted out of ruthless, short-sighted, and irresponsible self-interest” to protect the interests of its own – and it happens regularly by approving dangerous drugs and only recalling them in cases too egregious to ignore. Even then only reluctantly to assure maximum industry profits.

The agency also censors its own scientists as Dr. David Graham, associate director for science in the FDA’s Office of Drug Safety, explained in summer 2005:

” …the review and clearance process has been turned into a battleground, full of contention and intimidation because our managers, the people who fill out our performance evaluations, had created a system where it was taking a great risk to stand firm in our scientific beliefs.”

He essentially called the FDA a corrupted, industry-controlled tool placing bottom-line considerations over public health and welfare, then punishing whistleblowers who expose abuses …

… Secret White House-Big PhRMA Deal Revealed:

In mid-August, it was learned that the White House and Big PhRMA secretly agreed to what both sides denied. According to a knowledgeable insider, the Obama administration won’t use government leverage to bargain for lower prices, import them from Canada, demand Medicare rebates, or shift some drugs from Medicare Part B to Part D under which prices stay high most often. In return, PhRMA agreed to (but may not follow through on a promise to) cut up to but no more than $80 billion in projected costs over a ten year period, a small fraction of the extra billions it will reap if universally-mandated insurance coverage becomes law and drug coverage available under it.

Martin Weiss’ “20-Year Battle with Insurance Companies”:

In an August 17 commentary, financial expert and investor safety advocate Martin Weiss explained his own confrontations with insurers, starting in 1989 when he began rating them honestly.

At the time, large insurers like Executive Life, Fidelity Bankers Life, First Capital Life, and others were over-invested with risky junk bonds. He rated First Capital Life a D- and felt he was generous. Days later, company lawyers and officials threatened to sue and “put me out of business….if I didn’t give them a better rating.”

“Who the hell do you think you are,” they asked. “All the established ratings agencies give us high grades.” Weiss refused and cited the company’s own financial statement for proof. An “ultimate threat” followed:

“Weiss better shut the f… up or get a bodyguard,” one official said.

Instead, he “intensified” his warnings, and “within weeks, the company went belly up, still boasting high ratings from established agencies on the very day it failed. In fact, AM Best, the nation’s leading insurance rating agency, didn’t downgrade (the company) to a warning level until five days” after it went out of business along with two of its closest competitors, leaving their investors and policy holders high and dry …
(full text).

(My comment: Obama can do exactly as much as people is forcing the general elites to accept to give. Not more … People has to learn to guide the planet. Not less).

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