Pegaspargase – an example of how we don’t control drug costs

Under Medicare Part B, America’s seniors are entitled to drugs administered in the hospital, but they are responsible for 20% of the cost. That sounds reasonable, and Medicare officials say they carefully scrutinize drugs before approval.

But I have yet to discover a list of unapproved drugs. It appears that if the FDA says it can be sold, Medicare pays for it at list price. For a $50 drug, this seems reasonable. You would pay $10, and Medicare would pay $40 if administered in a hospital..

Not all drugs are priced equally, and paying for some – even at 20% – could be a financial disaster.

For example, Pegaspargase is a biologic that treats leukemia. It’s on the World Health Organization’s List of Essential Medicines. The course of recommended treatment is two vials every 14 days for up to six months.

Each vial costs Medicare $17,566. Since negotiation of drug prices is not allowed, the 26 vials needed for six months cost Medicare $228,358. That’s also the price for an uninsured senior or younger patient. (Medicare B and D are optional, extra-cost additions to original Medicare.)

Your co-pay under Medicare B for Pegaspargase would be $45,671. And that’s not all, because other drugs – anthracycline, vincristine, and prednisone – are often prescribed at the same time.

The Medicare Payment Advisory Commission said that physician-administered biologics accounted for two-thirds of spending and all 10 of the highest-expenditure drugs in Medicare Part B in 2017.

Biologic exclusivity in the United States is currently 12 years, and nations we are negotiating with are far less generous – eight years for China and Canada, and five years in Mexico. Recently, the GOP pushed for 10 years in current trade deals for foreign countries, but backed down to gain Democrat support to pass recent budget deal. The U.S. continues to guarantee 12 years.

If you don’t have $45,671 to co-pay for this required drug, a trip to India might be in order. Total price of 26 vials there is $5,460 –  a savings of some $40,000, and that’s not just co-pay, it’s the total price..

While India’s $210 a vial (versus $17,566 here) is the cheapest in the world, Great Britain’s National Health Service pays only $980 a vial, a savings of $16,500 vs. their liberated colony.

While elites of both political parties here have complained that Medicare is too generous to seniors – an insane accusation – they have done nothing to curb payments, including this example of $228,358 for one drug for one patient.

Drug lobbies have lawmakers addicted to campaign contributions, exotic trips, campaign funding and perhaps, even briefcases stuffed with cash, or offshore accounts. Big money is behind Big Pharma, and that includes the hedge funds, who finance drug development and mergers, as well as our willfully blind media, grown fat and complicit from billions of dollars in drug ads.

Young couple (drive two Ferraris and own a $700,000 home) charged $21 for 3-day hospital stay. Average senior pays $1,364.

The corporate exec was sincere when he explained to me why he didn’t pay most of his workers a wage higher than $14.25 an hour:

That rate keeps them under $30,000, and that’s about the cutoff for Medicaid and many other public assistance programs for a family of three.  Without Medicaid they would have to pay for health insurance and that isn’t cheap.

A raise to $31,000 can leads to a disaster for a family:

This year, the average (health insurance) annual premiums are $7,188 for single coverage and $20,576 for family coverage. The average premium for single coverage increased by 4% since 2018 and the average premium for family coverage increased by 5%. The average family premium has increased 54% since 2009 and 22% since 2014. – Kaiser Family Foundation (KFF).

Ferrari plus nearly free healthcare!

Even if your company offers a health plan, getting a raise can still be very bad news. In those plans, some $11,000 in annual premiums on average are paid by a family, and the remaining $9,500 by employers.

The much-touted $15 minimum wage (equals equals $31,200 a year) means no Medicaid for your family. That leaves you only eligible for private or company insurance that reduces your pay $2.50 an hour minimum and up to $10 an hour maximum.

No wonder that 75 million Americans are on Medicaid today, compared to just 50 million in 2010.

It is especially attractive, because if you work “under the table”, or have a business that “reports” low income, you can get Medicaid regardless of huge real estate investments or even owning multiple mansions, thanks to changes enacted by the Affordable Care Act.

Someone could own a home worth $850,000, a Lamborghini, a second vehicle, hundreds of acres of farmland, and still technically be eligible for Medicaid. These Americans would be considered wealthy by any standards, but by sheltering their net worth under the current tax laws, they would be legally eligible for Medicaid. – KFF

The only folks who can’t take advantage of the goodies in Medicaid (and still own terrific assets) are all 47 million seniors on Medicare. The elderly face a unique “assets test.” That’s just for seniors, and there are no exceptions for the elderly.

The insane rule is that you can’t have more than $2,300 in the bank, other savings, etc. The government can even investigate you to learn whether you made large gifts from prior savings to your children during the past 60 months.

The usual reason that seniors want Medicaid is to pay for nursing home care. Medicare pays nothing, but Medicaid covers it all. About 40% of nursing home residents are on Medicaid.

America’s nursing homes charge more than $85,000 annually at list price and that’s what you’ll pay until you are dirt poor and qualify for Medicaid. Insurance companies and Medicaid cut special deals and pay nowhere near that amount.

Some friends have suggested that Medicaid and Medicare are about the same thing.

Let me count some of the ways they are starkly different:

  1. Annual premiums: Medicaid is $0. Medicare is minimum $3,468 a year for a couple. High earners pay as much as $5,700 each.
  2. Inpatient hospital care:  Medicaid co-pay is $3 for each day in the hospital, up to $21 for the entire stay. Medicare co-pay for even one day is $1,364, and if you re-enter the hospital after 60 days, each time another $1,364 is due. For Medicare hospital days 61-90: an added $341 co-pay each day, and days 91 and beyond: another $682 each day. After 60 days beyond the 90 lifetime limit, Medicare pays nothing and you are responsible for all hospital bills.
  3. Short Procedure Unit: Medicaid co-pay is $3 for Surgical Center (ASC) visits. Medicare co-pay is 20% of the charges, no matter how high the cost. Some common procedures may be billed in excess of $10,000 list price.
  4. Brand name drugs: Medicaid co-pay is $3 for each prescription or refill. Medicare requires monthly co-pays up to $100 or more per prescription, depending on the drug. For example, Xarelto co-pay is about $1,200 annually. Medicare pays for all additional drugs only if an individual spends more than $6,350 a year out-of-pocket.
  5. Outpatient x-rays:  Medicaid co-pay is $1 for the total  service (not for each x-ray). Medicare co-pay is 20%. X-rays generally cost $260 to $460 each. Some are more than $1,000 list price.
  6. Physician visits: Medicaid co-pay is $0. Medicare co-pay is 20%.
  7. Chiropractor visits: Medicaid co-pay is $1 for each visit. Medicare will only cover chiropractic care as a treatment for a condition called spinal subluxation. Co-pay is 20%.
  8. Emergency services: Medicaid pays everything. Medicare co-pay is 20% of all charges, plus set fees for procedures and supplies. Average ER visit is $775.
  9. Blood and blood products: Medicaid pays everything. Medicare minimum co-pay is 20% of all charges.
  10. Drugs: Medicaid pays all costs for high blood pressure, cancer, diabetes, asthma, epilepsy, heart disease, psychosis, HIV/AIDS, glaucoma, depression, and anxiety drugs, as well as anti-Parkinson agents, anti-manic agents, anti-convulsants, anti-neoplastic agents, oral contraceptives, test strips, lancets, meters, and needles. Medicare co-pay is 20%
  11. Dental visits: Medicaid pays everything. Medicare pays nothing.
  12. Skilled Nursing Facility: Medicaid pays everything. Medicare co-pay is $0 for days 1-20; $175 for days 21 to 100; and you pay everything for days 101 and beyond.
  13. Nursing Home Care: Medicaid co-pay is $0. Medicare pays nothing for long-term care.

If all that doesn’t disturb you, consider the stupidity of the current political promise to enshrine Medicare for All, a program with fatal flaws that date back to its inception in 1965.

Medicaid for Everyone has a more logical beneficial foundation, and maybe this time it could include the old, the sick, those soon to die, and not just the young and sometimes quite wealthy.

Medicare destruction initiated by Trump, sounds like Paul Ryan. Mr. President feeds us “fake news” to enrich healthcare industry

“As long as I’m president, no one will lay a hand on your Medicare benefits,” President Donald Trump told the seniors at The Sharon L. Morse Performing Arts Center. He was celebrating the October, 2019 signing of his executive order to allegedly “protect and improve” the program.

Most of the audience clapped, but some had fallen asleep, and they were wiser for it.

Since he sauntered down the steps of Trump Castle to announce his candidacy, the President has promised not to touch our Medicare and Social Security, and he almost managed to keep this pledge for the first three years of his reign. October marked the end of that promise, and probably the beginning of the end for Medicare for Seniors.

Here’s a chart that shows Paul Ryan’s three main goals that Republicans need to accomplish to lead to the destruction of Medicare – outlined while he was Speaker of the House:

Trump’s executive order manages to fulfill two of Ryan’s three ways to “fix” Medicare:

  1. Higher premiums for seniors – The current mandatory $271 a month ($3,252 a year) Medicare A & B premium per couple will increase 6.43% next year, while the Social Security COLA increase will be 1.6%. Medicare premiums currently eat up an average of about 10% of Social Security benefits, but rates of 20% or more are expected as the government initiates the Trump doctrine.
  2. Increased profits for insurers – The establishment effort to end Medicare began in earnest with the Balanced Budget Act of 1997  This Bill Clinton fiasco allowed insurance companies to compete with Medicare by selling Medicare Advantage (MA) plans. These were government-subsidized private policies with HMOs and other cost-cutting features. Since 1997, Republican and Democrat government trustees have reduced traditional Medicare benefits and drastically hiked premiums – all in an effort to end the public Medicare program and replace it with MA.

As a result of intentional policies to privatize senior healthcare, the growth of Medicare Advantage plans has continued – with more than one in three retirees now enrolled:

Trump’s executive order will make traditional Medicare far more expensive than today, and since beneficiaries pay a portion of the cost, senior couples will get hit with premiums projected to reach as much as $6,000 to $7,000 annually.

The President will accomplish this with his mandate that the secretary of Health and Human Services examine raising traditional Medicare reimbursements to “more closely reflect the prices paid for services in [Medicare Advantage] and the commercial insurance market.”

Currently, traditional Medicare negotiates prices to lower them on behalf of seniors. Payments to hospitals and doctors are often half or even a third paid by for-profit healthcare plans. It’s no secret that the medical profession and investors hate Medicare, because it cuts into their huge profits.

By removing Medicare’s ability to negotiate, doctors and hospitals will be able to double or triple prices., leading to double or triple premiums for seniors.

And the more traditional Medicare spends, the higher the reimbursement to Medicare Advantage insurers, since the two are tied together by what is spent on the public program.

So, it’s no secret that insurance companies, hospitals, doctors and Wall Street are in love with Trump’s plan, which will allow even more profits to all.

Why is Trump doing this to seniors?

Republicans like Trump and Ryan consider Medicare “socialism” – simply because it serves the public without giving money to investors. They want a “capitalist” Medicare that allows as much profit as possible for the industry.

Since we pay doctors and hospitals much more than they collect in other countries, Medicare negotiations have kept the costs for 60 million seniors more reasonable. Instead of ending price-cutting in traditional Medicare, we should extend this policy to all healthcare programs.

While there are flaws in the Medicare for All advocated by progressives, the most required feature – besides increasing benefits – is that it would reduce reimbursements to current Medicare levels, or just the opposite of the Trump doctrine.

How important is the existence of Medicare and its regulated low premiums and negotiated healthcare costs?

Medicare today is the only healthcare plan available under law for the vast majority of seniors. You can’t buy any of the plans your children and grandchildren purchase. You are automatically enrolled and even the Affordable Care Act excludes someone older than 65.

STEM grad still living at home? Amazon and the other tech giants save billions by hiring foreigners, thanks to an ICE ripoff.

Last year, Amazon revenues were $232,000,000,000 – the same total amount as all the combined 2018 budgets of the following U.S. federal departments:

Small Business Administration, Environmental Protection Agency, Department of Commerce, Department of Labor, Treasury Department, Department of the Interior, Department of Transportation, Department of Agriculture, State Department, Department of Justice, Department of Energy, and Department of Education

Amazon’s corporate filing reveals that, far from paying the newly-lowered 21 percent tax rate on its immense U.S. income in 2018, the company received a federal income tax rebate of $129 million.

Not satisfied with no corporate income tax, Amazon and other firms are avoiding FICA’s employer/employee 15.3% levy for Social Security and Medicare. Here’s how the scheme works, and why it can hurt your family:

The major tech companies, including Amazon, Facebook, Microsoft and Apple, all benefit from a deal that allows them to hire tens of thousands of recent graduate software engineers, programmers and other STEM students for up to three years with renewals, and even longer if approved for a work visa.

The scheme is the Optional Practical Training (OPT) program, which exempts non-citizen workers from paying both FICA and Medicare taxes. Employers are also exempt from their matching share.

OPT’s lost taxes represent money that should be funding Social Security and senior health insurance – Medicare. While deficit hawks say these programs are underfunded, they are also the same politicians who have promoted OPT and its no-tax loopholes.

The exemption works this way, for example. An American, who earns $80,000 total a year, nets $73,888, vs. the OPT worker’s net of the full $80,000. In addition, the company saves $6,120 in payroll expense.

Meanwhile, universities are also pushing for even more OPT workers, because it allows them to exclude American candidates in favor of higher-tuition foreign students. This is especially true in graduate schools.

The National Foundation for American Policy (NFAP) said: “the fate of the optional training program could be critical for universities. International students make up about 80 percent of full-time graduate students in the United States in electrical engineering and computer science, and faculty rely on them for research assistance.”

The foundation is run by leadership associated with CATO Institute, a pro immigration group funded by the Koch foundations.

Some questions for NFAP? Why aren’t 80% of the positions taken by Americans, rather than vice-versa? Does this surplus of foreign grads, versus citizens, also account for the relatively low pay for workers with advanced degrees in the STEM disciplines?

Author Hillary Gamm was recently interviewed on SiriusXM, and she explained how OPT started. Gamm is author of Billions Lost: The American Tech Crisis and The Road Map to Change.

OPT started … in the Bush administration and then what Obama did … was he went from creating something that allowed foreign children studying in the United States to work for like six months or a year to instead be able to work three years and then get a renewal for up to five to six years.

So what’s happening today is you’ll have children that are American citizens, where parents have basically bankrupted themselves to send their kids to these American universities and they’ll be sitting alongside their foreign friends who are … earning the same degree. And those foreign children will have a job offer in hand when they graduate and the American child will not have even gotten an interview for that same company.

Tech giants employ thousands of OPT foreign workers annually, instead of American STEM graduates. In 2017 alone, Amazon placed nearly 2,400 OPT foreign workers into white-collar STEM jobs that should have gone to Americans.

Gamm said OPT is not a visa. It is actually administered by Immigration and Customs Enforcement (ICE), which exempts the employer and employee from FICA taxes.

Rep. Paul Gosar, DDS, (R-AZ) has introduced legislation – the Fairness for High-Skilled Americans Act– to end the OPT program abuses and decrease foreign job competition for our STEM graduates.

The bill passed the House, 385-65. Corporate lackeys will kill it in the Senate.

As an aside, one game played in Congress is for House members to vote on bills they want killed, gaining positive publicity, but knowing that the bill will never pass the Senate, so their vote was just fake to get votes.

Jeff Bezos could go on Medicaid if he played it correctly, but the average working Jill can’t

Medicaid rules changed when President Barack Obama pushed through the Affordable Car Act (ACA) and he ensured that the very rich could join low-cost Medicaid, while the working class had to pay high medical expenses, either at work with private insurance or retired under Medicare.

While I’m sure Jeff Bezos would never stoop his mightiness to rub elbows with regular folks on Medicaid, it is amazing that he could so by following these steps: Continue reading “Jeff Bezos could go on Medicaid if he played it correctly, but the average working Jill can’t”

You turn 65 and then you must go into a Medicare plan, and you pay a fortune more for far fewer benefits

What a difference a year makes.

You are one of the millions of Americans, who don’t have company health insurance. Damned with a pre-existing condition, you carry so-called Obamacare (

Oh no, not Medicare!

Next year, you turn 65 and must enroll in Medicare.

There’s no good news, just bad news for you. Obamacare is a far better plan than Medicare and costs at least $1,800 less a year.

Worst of all, there’s no limit on how much you might spend on healthcare and then face bankruptcy. Continue reading “You turn 65 and then you must go into a Medicare plan, and you pay a fortune more for far fewer benefits”

H-2A workers don’t pay Social Security (FICA) tax, neither do the millionaires who are exploiting them

Foreign agricultural workers temporarily admitted into the United States on H-2A visas are exempt from U.S. Social Security and Medicare taxes on compensation paid to them for services performed in connection with the H-2A visa. This is true whether they are resident aliens or nonresident aliens.

In addition, compensation paid to H-2A agricultural workers for services performed in connection with the H-2A visa is not considered to be “wages” for purposes of federal income tax withholding, and thus is not subject to mandatory withholding of U.S. federal income tax…Internal Revenue Service

More than 160,000 new temporary (up to three years extension allowed) workers were issued H-2A Visas last year, with about half of those going to Georgia, North Carolina, Florida, Washington and California. Their employers did not pay the company share (6.2%) for FICA (Social Security) or Medicare tax (1.45%). Their bosses didn’t even withhold income taxes, making net pay almost the same same as gross pay. Continue reading “H-2A workers don’t pay Social Security (FICA) tax, neither do the millionaires who are exploiting them”

Congress votes to destroy Social Security, 233-184

Those April showers have drowned the media this year with reports of a petulant, prosthetic protuberant princess, also know as “What’s Her Name” or “Smarmy Scandals.”

Meanwhile, back in Congress, 233 members – 54% of that angst body – voted to destroy the Social Security system by not allowing the use of its $2.9 trillion in reserves, forcing cuts of up to 24% in coming years.

As a big boy bonus, this bookkeeping manipulation will allow the fiscal twits to proclaim that nearly three trillion dollars has been cut from the National Debt. These reserves come from excess FICA taxes previously paid by Americans to subsidize years where there was a tax collection shortfall.

But like Tiger Woods winning this year’s Masters (tied at 32), it was not to be. The bill – H.J. Res 2 – required a 66% vote to pass. It fell short by 12%, but under House rules this Constitutional Amendment can be brought up over and over again. Continue reading “Congress votes to destroy Social Security, 233-184”