An Ethical Drug Plan?

Medicare Part D brought about numerous changes within the pharmaceutical industry. The members of the previous Medicare plans were told to choose from literally thousands of Part D plans in a short period of time in order to have any sort of drug coverage. It resulted in a lot of members enrolling in plans which may not have been best suited to their needs and basically created total chaos. Even after few years in running, the members are still trying to understand the plan details and its so-called advantages over the previous Medicare plan.

I would agree with the professor that advantages clearly lie with the pharmaceutical companies rather than the enrollees of the Part D plans. These companies clearly gain from not having to offer best/lowest government prices to Part D plans anymore. Historically, the pharmaceutical industry has always been one of the top performing sectors and this only adds to the higher profit margins. These companies also gain as they no longer have to reserve for additional rebates, charge backs that used to be generated from charges submitted by older Medicare plans (decrease in % reserve would add to the bottom line). One could argue that these profit margins are needed to invest more in R&D to create better drugs. Additionally, with many of the blockbusters drugs recently or ready to go generic, the companies need these advantages to offset the losses. But with the pharmaceutical companies already charging premium pricing for their drugs, is this necessary? Aren’t the annual price (and sometimes two or three) increases of 5-10% enough?

It also seems unjustified that the members of these plans are banned from buying cheaper drugs from foreign countries even when they are in the ‘donut hole.’ These members, mostly retired Americans, depend on their retired income and social security to survive and these bans put further financial pressure on them in midst of rising cost of living. But then again, in support of the pharmaceuticals, one could argue that American pharmaceutical companies guarantee top level products as they have passed tough FDA standards where as the imports don’t carry any known standards; you could simply be buying a placebo.

It seems like the Part D plan is here to stay although there may be changes made after the presidential election later this year. In the mean time, it is only fair that the members are clearly explained the pros and cons of each plan so that they are better able to choose a plan which may cover specific drugs that they are prescribed to. Till this is done, it is hard not to classify these plans as unethical?