Playing the health insurance shell game

Last Wednesday, we were treated to another nonsensical "My Turn" by Chuck Malloy, where he started off by thanking goodness for insurance. He went on to say that he needed to purchase an insulin pen and the cost of a five pack over the counter without insurance was $500, but thanks to the wonderful insurance world, he only paid $35.

I checked online, and found a study in 2010 that was titled "Life-saving insulin largely unaffordable, a one day snapshot of the price of insulin across 60 countries." The study found that the drug price varied greatly across the sixty countries. The pens manufactured by Eli Lilly retailed in America for $53 per pen, while in Egypt, the same brand cost just $2.57 per pen. Chuck feels delighted that he was only required to pay $35 for his five pens ($7 each) thanks to insurance, who he seems to assume picked up the rest of the $500 price tab.

News flash, folks, it is a shell game. The insurance didn't pay $465, it likely paid less than $40, and may have paid less than $15. As David Kliff of DiabetesInvestor.com wrote, "What the consumer pays and what insurers pay are two different worlds." The real game is one that the insurance industry is working, of colluding with pharmaceutical companies to inflate the "retail" (uninsured) price of drugs to try to force people into paying for insurance that they only need because the insurance industry is jacking the no-insurance prices up to gain new clients.

For example, insurance company "A" could say to a pharmaceutical chain "fine, we will pay $8 per dose, as long as you retail it at no less than $96 per dose for cash paying purchasers." Additionally, it is interesting that the "retail" price in America for insulin almost doubled in the last five years. Not a bad jump if you are the company making the no longer patented drug! Good thing the FDA is dragging their feet and not allowing generic versions to be approved.

If the oil companies could get that type of monopoly approved, people like Chuck would be thanking goodness for gasoline insurance. Perhaps he needed to buy some the other day, and found that the retail price for non-insured gas purchasers was $97 per gallon, but thanks to his gas insurance he got a break and only had to pay $14 per gallon. Sadly, the rest of America never wonders why countries without a Congress-authorized monopoly forcing people to purchase gas insurance pay less than $3 per gallon, plus local gas taxes.

This type of racket can't work without prohibitions on re-importing the drug from other countries, for "your protection" of course. But don't worry, we elect good people to Congress who will get right on this scam and do something about it, right? Did you know that the pharmaceutical industry spent over $2.6 billion on lobbyists between 1998 and 2012? This was in addition to the money donated to political campaigns, so don't hold your breath, unless you want to look as silly as the people like Chuck who either don't understand how it works, or who do and are trying to mislead you anyway. Which are you, Chuck?

Larry Spencer is a Kootenai County resident.