In the current U.S. health care system, the government and
insurance companies subsidize the black market for narcotics (for more on this,
please read: http://bit.ly/wlrjEI). By setting prices for narcotic pills far below
the market rate between individuals, they subsidize the street narcotic
industry and set up a false price paradigm that affects the price perceptions
in medicine. This pricing malady is incorporated
into insurance prior authorization (PA) algorithms and consistently distorts
clinical care delivered to patients.
In an effort to reduce costs, government payers and insurers
use a process of PAs to control the behavior of patients and physicians. It is basically behavior change mediated by
discouragement (a form of hassle-based rationing). If the barriers and criteria to meet the PA are
too high, physicians and patients get discouraged and often decide to pursue a
pathway with less resistance. The
problem is that many PAs incorporate subsidized narcotic price information
which makes the use of narcotics seem like the most cost-effective option. Vicodin is preferred by insurance companies,
and they will use a PA to limit the use of medications that seem to be more
expensive.
An example of this distorted PA process can be found when
comparing Vicodin to Celebrex (an effective anti-inflammatory medication). Which is cheaper? It depends on what prices are used: the market rate or the subsidized rate. Vicodin’s street price is $600 for 120 pills
on the street. The cash price for a
month’s supply of Celebrex 200mg daily on www.Healthwarehouse.com is $143.00 (http://bit.ly/GNVIzJ). That makes Vicodin more expensive (4x more
expensive!) than brand anti-inflammatory medication when using its
nonsubsidized price. Which medicine gets
the hassle of a PA? Why Celebrex of
course!
Suboxone (a partial
opioid agonist used for opioid addiction treatment) costs $426 per month for 60
films at www.Healthwarehouse.com (http://bit.ly/GO07Bj). Again, Suboxone is cheaper than 120 tablets of
Vicodin ($600) once the subsidy is stripped away. Cash MRI prices in Michigan are as low as $400
making Vicodin more expensive than MRI’s.
Physical therapy visits are also cheaper than Vicodin therapy. Actually,
most things in outpatient medicine are cheaper than Vicodin. So why do so many useful medications and therapies
have PAs while Vicodin gets easily paid without any hassle? In classic “garbage in, garbage out” fashion,
if subsidized price data for Vicodin is used, it will always appear cheaper
than other options even though it is actually more expensive.
These structural price defects in clinical care pathways create
the unintended consequence of pushing patients and physicians down the dangerous
pathway of using narcotics more frequently than needed. With more narcotic prescriptions come higher
amounts of black market narcotics, more overdoses, and more cost to the health
care system as addiction disorders rise.
In 2009, 31,758 patients died in the US due to unintentional poisoning
(CDC: http://1.usa.gov/gUcZVx). How many more people will have to die before
the subsidization of narcotics ends?
What can be done to stop the flooding of our streets with
prescription narcotics? The next post on
this subject will focus on concrete solutions.
The first step: stop the massive
subsidization of narcotics.
