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This is great news! Keep calling your Senators and Congressperson.

FYI. I think youth football should be flag and low contact until 18, best case even older. Science shows smashing young brains with helmets on is not a good idea, to say the least. But I'm the oddball who thinks allowing kids to practice headers in soccer is asinine given what we now know about the human brain and impacts of all types.

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Jun 18, 2022Liked by Matt Stoller

Thankfully, some light at the end of the tunnel. If only we could get Buttigieg’s mind off of a job he is not remotely qualified for and on to business he should be dealing with - airlines for example.

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Jun 18, 2022Liked by Matt Stoller

Okay, now I'm starting to be convinced! Action against PBMs is definitely a big deal. Cracking down on venue-shopping is also a big deal.

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FYI, you can read the American Prospect column without an account if you use 'Toggle reader view' in Firefox on the page.

Thanks for the updates!

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Sorry - where is "Toggle reader view" ? What does it look like and where do you find it?ow

When i went back, I got in, but don't know h0w (grin)

Any way, while was there, found another article

https://prospect.org/infrastructure/transportation/as-buttigieg-eyes-presidential-run-dot-is-floundering/

Buttigieg is a slippery fellow - I remember during the early Pres primary in Iowa in '20 - which he "won" and there was an issue of an app or something upgrade of voting software (sorry, no doubt using the wrong lingo, but i hope some folks will remember) - suggesting some funny business ...

Apparently he still has Pres ambitions - so he needs backing and i am wondering if the airline industry might be one he is courting -

Just a thought ...

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I like that the government is going after unfair business practices, but the insulin case, and entire pharmaceutical industry is more complex and not easily simplified in a column. It will be very difficult for the government to argue PBMs negotiating rebates have increased costs for the country.

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author

Why do you say that? Seems like a 70% rebate is an obvious incentive for higher prices, and indeed, prices in the US are higher!

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Jun 19, 2022·edited Jun 19, 2022

It is a lot more complicated with how we got here than people think. The manufacturer has essentially a monopoly. The PBMs came in and negotiated discounts (i.e. rebates) when there were multiple insulins and there was leverage against the manufacturer. Then the manufacturer raised prices to keep from plummeting revenue. Rinse and repeat 20x's now. It is similar to the hospital contracts with insurance companies back in the 90's early 2000's when many deals were discounts off charges to the hospitals just kept increasing charges along with discounts until the billed retail price had no relevency to the actual cost. At the end of the day the motivation of the PBM was to do right by their customers and force the manufacturers to compete. They did, but when this happens with percent discounts it can kind of spiral like it has. I would note that the person getting screwed here is the person without insurance that pays full retail cost when the full retail cost is kind of irrelevant. Either way, there wasn't 'intent' to just increase prices for the country. PBMs aren't my favorite entities, but they pulled what levers they could to try and decrease prices.

There are also other factors giving incentives beyond this game causing the retail price to increase.

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Jun 19, 2022·edited Jun 19, 2022Author

“The manufacturer has essentially a monopoly.”

Vs

“The PBMs came in and negotiated discounts (i.e. rebates) when there were multiple insulins and there was leverage against the manufacturer.”

Which is it? A monopoly or ‘multiple insulins?’

There are three producers who compete. They just compete over who gives a higher kickback to the PBM.

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It didn’t start out that way. Rebates really only exist where there is some competition. I am not saying I like where the market has gone but the competition used to only exist in getting doctors to write a script. The pbms probably have net costs below where they would be without them and it could be argued they take too much. I am just saying there are some chicken and egg problems here and without patent reform and / or government takeover there aren’t easy fixes.

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It seems you are suggesting that PBMs, in effect. perform a sort of "regulatory" function re pricing - but, here again, as with insurance companies, who actually benefits from this "regulation" - they do, their profit comes from skimming off money from the "healthcare" system - so lets eliminate this middleman and have the 'non-profit' Gov't do it instead

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Pbms have definitely taken their share of the dollars. I can’t say with great confidence prices would be lower with government setting prices. How much do we pay for Covid vaccines compared to other countries?

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Gov.t didn't set those prices - Phrma did and that's the problem ...

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I have seen how us gov sets prices first hand. They set prices they are told to set

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