Obama Budget Dangerous Step to Rationed Health Care

Image credit: Shutterstock.com
Image credit: Shutterstock.com

How much is a life worth? That is the question President Obama asks in his latest budget when he proposes the federal government negotiate drug prices under Medicare Part D. The truth is, as Europe’s experience shows, governments don’t “negotiate” prices, they either set prices or prohibit access in their countries to higher-cost medicine.


This new budget continues Obama’s lurch toward a full-blown government-run healthcare system. The president wants to allow bean counters to conduct cost-benefit analyses on life-saving treatments, bypassing both doctors and patients. That will cost lives and crush medical innovation.

Consider the nationalized approach of some European socialist democracies. National health systems from Switzerland and Great Britain refuse to pay for cutting-edge drugs, limiting availability and subjecting patients to substandard care. Britain, in particular, forces drug manufacturers into an all-or-nothing program, where they either negotiate with the government or are unable to sell any drugs in the country.

That’s why Nivolumab, a drug that is “twice as effective as chemotherapy and carries far fewer side effects” will not be available to cancer patients in Britain.

By everyone’s estimates, Nivolumab is revolutionary; it took the one-year survival rate of severely-ill lung cancer patients up nearly 100 percent – from 24 percent under current treatments to 42 percent. The drug doesn’t just extend lives, but it also helps shrink tumors – an outcome experts say is “almost unthinkable on chemotherapy.”

Yet as many life-saving procedures are, it is also costly: Around $90,000 per year for treatment.

That forced Britain’s National Institute for Health and Care Excellence into a position to quantify the value of lung cancer patients’ lives. Their analysis: the costs are too high to justify the amount of lives saved. Potentially, more than 17,000 lung and skin-cancer patients a year will go without access to this innovative treatment.


But there’s another, potentially more disturbing trend in Britain – a disparity in care between patients in poor and affluent areas. How does that play out? A study of medical records from 2002 to 2013 found that patients in poor areas were substantially less likely to be prescribed anti-dementia drugs, according to the University College London:

“When access to any treatment is rationed, wealthier patients and their families tend to be better-equipped to navigate the healthcare system and get around the restrictions,” explains study author Dr Claudia Cooper (UCL Psychiatry). “They might do more research and know what to do to get the diagnosis and treatment that they want. They could also be more confident and assertive in asking doctors for specific treatments. Observational studies like this can increase our understanding of possible links between inequality and treatment outcomes, but they do not show direct cause and effect as we cannot rule out other explanations.”

For now, the U.S. is a great place to receive medical care, particularly as it relates to early access to prescription medication:

Americans also have faster access to new drugs than patients in many other countries. That’s in part because the U.S. has always been a very attractive market for pharmaceutical companies: It’s big, accounting for 34 percent of the world market; has low levels of price regulation; and offers few barriers to market entry once FDA approval has been secured. (By contrast, in some other countries there may be a time lag between clinical approval of a drug and the point when it is added to official lists of reimbursable drugs.)

The result is that companies often choose the U.S. to launch new products. And, because the US market is so big and profitable, investments in research and development have long been steered towards meeting its clinical needs.


That’s why Nivolumab is available in the United States, where the government does not yet hold the power to ration care.


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