Disagreement is Part of the Job...

I hate to have to disagree with so much of the commentary about the state of healthcare today. The "bigs" -- big insurance, big pharma, big hospitals, have a loud megaphone. They get lots of attention being on TV, front & center in major publications and huge billboards at every sporting event everywhere. That's nothing compared to the numbers of lobbyists they have in every state capitol and Washington, DC who play golf or otherwise rub elbows with those who make policy in this country. So, no one should be surprised at a group of smart people gathered in round table discussions like the show State Lines in my home state of North Carolina where they still are dancing all around the actual problems. At the 16:40 mark, you'll hear the host Kelly McCullen highlight the news story that I wrote about on my company's blog last week. The NC State Health Plan said "no" to giving members access to Ozempic and Wegovy simply for weight loss purposes. It's a move that's prompting those who stand to make billions from the sale of these drugs jump to defend the drug as a miracle shot.

If you watch the roughly 7-minute segment and you know ANYTHING about pharmacy benefit managers (PBMs), you'll be shaking your head. I certainly was. Realizing that none privileged to have a seat at that table knew enough to ask why the NC State Health Plan's PBM set their rebate from Novo Nordisk so high that State Treasurer Dale Folwell had to take action. It's not the manufacturer that sets the price of drugs. It's the PBM! I mean, even State Senator Natalie Murdock knew enough to report that she read somewhere manufacturers can produce GLP-1s for around $22.00. She was close but still a little high. Healthline reported this week that a study in JAMA, Journal of the American Medical Association suggests that Ozempic can be made for less than $5.00 per month. So, just doing a little simple math that means the $1200.00 list price is a pretty big markup over the actual cost to produce the drug. And just how much of that is charged to the plan members and sent back to the PBM as a "rebate"? I'm not sure yet. But here's a chart that shows you the similar math for the markup on insulin, a much more important drug in the grand scheme of things.

The orange line represents the net revenue to insulin manufacturers over the last 14 years. The blue line represents the gross cost. How do ya' like them apples? Well, if you're a diabetic, you can't actually eat apples unless you have insulin. Even with the now mostly $35 insulin price tag at the cash register (after some in Washington, DC finally heard enough yelling about PBM shenanigans), what we still have here is a gimmick just meant to quiet down the masses and keep the PBM lobbying money flowing. The balloon has been squeezed at the point of sale and has unnecessarily inflated on the other end where not many dare to look. The results of that back room inflationary affect won't show up immediately. But, in about a year when it's time to renew your health insurance it'll show up as higher premiums. One of my favorite sayings is "today's claims = tomorrow's premiums". Someday I'm gonna put that on a bumper sticker.

Part of what the committee that makes decisions on behalf of the NC State Health Plan realized after studying it, is that the cardiovascular risk associated with obesity doesn't necessarily show up until NC state employees are retired. The actual risk is much smaller than you might think. I don't care who you are, you have to admit that the NCSHP made a prudent decision to agree to not spend hundreds of millions of dollars per year just to maybe prevent a few heart attacks in retirees that won't even be members of the plan by then. I wrote a couple of blogs on my website before I started this newsletter. Both mentioned the other side effects of semaglutide drugs like Ozempic and all their copycats. Stuff like gastric paralysis, muscle wasting, etc. You can find my blog at custombenefits.work.

In case you hadn't had time to track the actual science back to its origin, GLP-1s decrease hunger and make you feel full longer because they significantly slow the digestion of food as it passes through the GI track. I'm no clinician or scientist but I also see a future epidemic of stomach and colon cancers not yet associated with these designer drugs.

Let's say you injected yourself with your weekly dose of Ozempic on Sunday night. You'll likely be feeling pretty crappy until Wednesday (maybe longer). You just won't want much to eat. On Wednesday, you might jump on the scale and see you're down 4 pounds in that period of time! Wow! So, you reward yourself with a footlong hotdog with all the fixins, and fries on the side; washing it down with a diet soda. That hotdog stays in your GI track for many more hours than usual and with the carcinogens some hotdogs contain...well, you see where I'm going with this.

I heard a great podcast last week from the The Phia Group, LLC which told of the science behind GLP-1s and how the gila monster plays into it. If you're into how health plans are dealing with rising healthcare costs, Phia Group's podcast needs to be in your library.

The other thing I learned on the Phia Group podcast was that the ratio of fat to muscle loss in people taking semaglutide drugs is 1:1. So, for every pound of fat that's lost, there's a loss of an equal amount of muscle. That's incredible to me that no one on State Lines bothered to even mention the negative side effects of these drugs. They were only worried about having something taken away from the poor state employees. Maybe someday they'll look back on this and realize the decision makers at the NCSHP were doing them a favor; actually looking out for their best interests and that of the state health plan's reserves.

Well, that's probably enough for today. I hope you'll subscribe to my podcast, Healthcare Solutions on Apple Podcasts and Spotify. Next up is a great 2nd conversation with Vinay Patel, founder of Mako-Rx, an awesome PBM based in Raleigh, NC that has successfully negotiated the price of Ozempic to lower than $500/month for his clients. Maybe the NCSHP needs to be talking to him! Ya' think? But of course, BCBSNC won't allow that. Oh well, until next time!

Stay healthy, y'all.

Cristy Gupton, President of Custom Benefits Solutions