Healthcare challenges ahead for Obama
pharmafile | November 6, 2008 | News story | Sales and Marketing |Â Â US, reformÂ
After his resounding election victory, America's new President-Elect Barack Obama is already assembling his White House team.
During the election, polls showed that after the economy and Iraq, healthcare is America's biggest worry. There is a consensus that the growth in spending on the US healthcare system is unsustainable, but opinions differ on how to solve the growing problem.
Obama will now have the chance to push through his plan for change in the nation's healthcare system Medicare, which most agree is in dire need of reform. And just as US foreign policy has worldwide implications, changes in the US healthcare system will have major implications for the global pharmaceutical industry.
A poll conducted for health think-tank the Kaiser Foundation in September found that healthcare was the third most important issue for voters, behind the war in Iraq (in second place) and the economy.
It is easy to see why so many Americans are concerned about healthcare: 45 million citizens have no health insurance at all, and for those that do, costs have risen sharply.
The Kaiser Foundation says employer-sponsored health insurance premiums (which cover an employee's whole family) have nearly doubled in price since 2000.
Patients also make co-payments, which include prescriptions, towards their care and the National Coalition on Healthcare says these costs rose 115% between 2000 and 2006.
Annual healthcare spending currently stands at $2,300 billion, making it the most expensive healthcare system in the world per head of population.
A Kaiser poll study due to be published in the 6 November issue of the New England Journal of Medicine found seven in ten registered voters say major changes are needed in the country's health care system.
"Healthcare is a part of the economic anxieties of the public," said Kaiser's president and chief executive Drew Altman. "People are having major problems getting and paying for healthcare and, if this trend continues, addressing health care as part of the nation's economic turmoil may be a priority for the nation's next president."
Obama's healthcare plan
John McCain's healthcare plan was seen as the more radical, with the aim of sweeping away the current mainstay, employer-provided insurance, and bringing in insurance plans for every individual.
But Obama's election promise was more modest in its reform of the system, aiming to retain the current employer-based insurance, but requiring them to guarantee 'meaningful' levels of insurance. This would not mean mandatory coverage for adults, but insurance would be compulsory for children. This system would be financed by finding new efficiencies in the system (including better use of IT and chronic disease management) as well as repealing tax cuts for the rich.
The consensus view from the nation's think-tanks and analysts is that there are few easy answers to the timebomb of healthcare costs in the US. The problems are only exacerbated by the recession expected to hit the country very shortly.
Pharma has reason to be fearful in this crisis, Obama may follow up on promises to examine new ways of cutting drug prices to control spending, including the idea of allowing 'reimportation' of drugs from countries with lower prices.
But the industry is already suffering from its own downturn, in the shape of a wave of patent expiries on major drugs.
This gloom for pharma is contributing to one of the few pieces of good news in healthcare for the US government: Medicare's drugs bill fell $6 billion in 2008, while overall Medicare prescription drug spending dropped 12% to $44 billion in the fiscal year ending 30 September, helped by the patent expiry of major drugs such as Merck's Fosamax.
Related Content
Sharp invests $100m in US and EU manufacturing and packaging facilities
Sharp Services, a pharmaceutical packaging and sterile manufacturing specialist, has announced investments totalling $100m across …
Moderna doses first US patient in phase 1 trial of mRNA-4106 for solid tumours
The START Center for Cancer Research has dosed the first US participant in Moderna’s phase …
Strategic alliance announced between Recipharm and Exela
Recipharm and Exela have announced that they have entered into an exclusive strategic alliance. The …
