August 30, 2023 • 11 mins
Biden is being praised for lowering the cost of 10 medications for people on Medicare. That being said, the prices of our prescriptions are still out of control!
Craig Gottwals, aka "Craig the Healthcare Guru", talks about that and more in a new episode of A&G's Extra Large Podcast.
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Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
President Biden announcing for the first time ever, Medicare will
begin negotiating drug prices with manufacturers, targeting ten major medications
that treat everything from diabetes to blood cloths to cancer.
The President says it will mean lower healthcare costs for
millions of Americans. As many as nine million seniors take
at least one of the drugs on the list, some
(00:22):
paying up to six five hundred dollars out of pocket
each year. Seniors will see those savings kick in in about.
Speaker 2 (00:28):
Two and a half years.
Speaker 1 (00:29):
The prices have to first be negotiated with those drug companies,
and some of them are already trying to block this
program in court. But still the White House says they're
confident they will win and that the list of drugs
announced today is just the beginning.
Speaker 2 (00:41):
So the question I have any time I hear a
story like that is how true? Is it? Is it
going to matter to me or just other people? So
we thought we'd talked to an expert.
Speaker 3 (00:49):
Yeah, indeed, and that two and a half years from
now thing m Yeah, Craig got Walls. Craig, the healthcare guru,
joins us. He's an attorney, lawn benefit consultant, with benefit Revolution. Craig, Well,
how are you, sir?
Speaker 4 (01:00):
I'm well, how are you, gentlemen? Oh?
Speaker 3 (01:02):
Terrific? Thank you. So what did you make of this?
How significant is it?
Speaker 4 (01:06):
It's a good deal, man. It's you know, when your
dog comes to you after ignoring you for weeks and
weeks and weeks, you don't spank it, right, You reward
the dog for coming to you. And so this is
this is a move in the right direction. Now, the
analogy I would give you, guys is we're in a
canoe in the middle of a lake. It's rocking and rolling,
and we've got a big leak and the water's coming
in rapidly. In our right cup, we have a red
(01:29):
solo cup. That's the Trump Trump transparency regulations. In our
left cup, we now have a dixie cup and we're
bailing that canoe. And this dixie cup is this drug
deal only because it's just ten drugs and it's two
and a half years away. I totally applaud the move.
We need way more of this, But how about all
the drugs starting tomorrow? Right? I mean, this is just
(01:50):
a travesty. We're overpaying. We pay three times what other
countries pay for these same darn drugs and it's just
because it's been all mobbed up for twenty plus years
and can't negotiate with with the drug companies.
Speaker 3 (02:02):
Well, you partially answered my next question. But why such
an incremental move, do you think?
Speaker 4 (02:07):
Well, because, uh, because healthcare is the number one lobby
in the United States and healthcare is the number one
industry in the United States. And it's really bad for
reelection if you say, if you say no, or if
you try and curtail those people that are paying for
your reelection.
Speaker 2 (02:24):
Oh man, yep. So and okay, before I get to
my question, So we're paying three times more than the
rest of the world for the same drugs on average.
Speaker 4 (02:35):
That's actually yes, right.
Speaker 2 (02:37):
That ain't good.
Speaker 4 (02:38):
So nope.
Speaker 2 (02:40):
So the news report there mentioned the drug companies are
trying to you know, they're pushing back, they're trying to
come up with a way around it. Do you think
in two and a half years they'll figure out a
way around it.
Speaker 4 (02:50):
Well, they're certainly going to try. And there are I
counted up yesterday eight lawsuits already filed just on this topic.
So every major drug manufacturer is in on it, and
they want to stop it. Obviously, because that chokes off
their cash cow, don't I don't know if they'll have
success this time around, because you know, we're thirty three
trillion in debt as a country. We are a bankrupt
(03:12):
you know, insurance company effectively with a with a failing military.
So I don't see how I don't see how you
make the argument that we can't do this. I mean,
this one, this one, to me, is a no brainer
that overwhelmingly Republicans and Democrats agree on. I mean, I
think it's something like seven percent of Republicans agree we
should be negotiating these prices, and it's like mid eighties
(03:32):
for Democrats. I'll tell you where this became screwy, gentlemen.
Was it was something we never did. We never negotiated
these prices. Okay, we just accepted whatever bogus off the
shelf price the drug companies wanted, and we paid it
with Medicare and Medicaid.
Speaker 3 (03:49):
Which is bizarre, if I might interject, I mean, can
you imagine bizarre?
Speaker 4 (03:54):
Yeah, imagine if we had to go buy cars that way. Well,
of course, that's kind of how the government does buy cars.
Sticker price for everything. But in two thousand and two,
George Bush wrote this into law. He codified it, which
didn't really change the modus operendi because we weren't negotiating anyway,
but it was again a nod to one of his
largest donor classes, Big Pharma. Then this is where it
(04:15):
gets fascinating. You had pushback on it because Democrats were
against that. Democrats were four price negotiation, and Republicans were
against it. And that went all the way up to
two thousand and nine. And in two thousand and nine,
President Obama realized, there's no way I'm going to get
Obamacare passed unless I get the hospitals, the insurance companies,
and big pharma on my side. So he gave out
(04:38):
little dog treats to each of those industries, and the
dog treat he gave to Pharma was, we will, even
with Obamacare, we will not negotiate drug prices. And then
Obama took money from the healthcare industry, which was something
that Democrats didn't buy and large do at that time.
But what that did is it opened the floodgates. So
now after two thousand and nine, both parties are on
(04:59):
the pay life of the massive lobbies associated with healthcare.
And that's what's kick this can all the way down
the road to twenty twenty three, where finally we got
to do something right. The house is on fire and
all we've got to fire all We've got the garden hose.
So what do we do? We're going to negotiate these
ten two and a half years from now. It's really
similar to what they did with Obamacare. Wow.
Speaker 3 (05:20):
I didn't think I could become more cynical through the
course of a single segment of the show. But I
have you remember when three or four years ago, Craig,
you and I were semi obsessive about figuring out where
we should move where there is liberty and free markets
and that sort of thing.
Speaker 2 (05:34):
Are you still on that way?
Speaker 3 (05:35):
Where would you go right now?
Speaker 2 (05:36):
As an ex pad Portugal?
Speaker 4 (05:38):
That's my latest one is portable Portugal. I just did
a neighbor go there and he's telling me all about it.
It sounds fantastic.
Speaker 3 (05:46):
Wow, Wow, warm Weather beaches, et cetera. Okay, so.
Speaker 4 (05:52):
Maybe I'm going to say, Jack, I want to tell
you guys the story of a drug. I just want
to if I can, if I can fit it in here,
I want to illustrate this point where you just how
corrupt this is. So Aveston and lucentis same drug, same
active components made by Genentech, Lucentus came first. The problem
is Lucentus is thirty eight times more expensive than Aveston.
So Leucentus is used to treat cancer by slowing the
(06:15):
growth of blood vessels that feed the tumors. But innovative
doctors realized, oh my gosh, we could inject a tiny
amount of Aveston into an eyeball in slow macular degeneration.
It worked, it was phenomenal, and in so doing they
used so little it was only sixty dollars per injection. Okay,
So Genentech says, well, we can't have that. We're not
(06:35):
making enough money on it. So genen Tech repackages Aveston,
rebrands it is Loucentus, sells it for the eye, and
charges twenty three hundred dollars per dose, thirty eight times
thirty eight times what doctors were paying to do it.
Then Genentech comes out and says, and by the way,
you can't use Aveston anymore, it's not safe. Honorable ophthalmologist
(06:58):
said that's bs we can still use it. And they
fought it and they sued in genen tech back down. Now,
why would doctors want to prescribe that more expensive drug
because they're paid six percent of the cost of the drug.
So every doctor that was prescribing Loocentus made one hundred
and thirty eight dollars a pop, while every doctor that
was still using the avestin was only making a Starbucks Americano. Wow,
(07:22):
that's just one drug example, Jens, one drug example that
I have followed over the years, and our industry is
riddled with them, riddled with them. So when they come
out and say it's a big deal to negotiate ten
you know what, it's a big deal to negotiate. I'm
happy we're doing it, but we need to be negotiating
all these prices right now. It's our tax dollars. This
is our biggest expense, and we're taking it so lightly
(07:44):
in the face of thirty three trillion in debt.
Speaker 3 (07:46):
Well, and you pile that on top of the discussion
we've had several times about how Obamacare has enriched the
major insurance companies beyond their wildest dreams. That their stock
price has risen seventeen times faster than the S and
P five hundred orld, whatever the number is. It is utterly,
utterly corrupt.
Speaker 4 (08:05):
It is. It is. You know what, I've been in
this industry for twenty two years, gentlemen, I've never been
more cynical. But I'll tell you what, I've also never
been more excited and had more fun because we now
have tools to fight this. And this is going to
give us tools to fight it because every drug they
start to negotiate, the private market will seize upon and
we'll be able to ride those coattails and negotiate lower
(08:26):
prices for themselves as well. So it's a dixie cup
to a flooding canoe. But at least I got a
dixie cup in one hand and a Solo cup in
the other, so we're using them.
Speaker 2 (08:35):
I don't know if my question is like a completely
different topic, but like I always just picked the pharmacy
it was closest to my house or my hospital. That's
the way I always did it because it just seemed easier.
But then, so I was going to buy a drug
at I won't mention the name, but I was going
to buy a drug at one of your popular pharmacies
and they didn't have it. It was a lot, and
the pharmacists actually said, can I talk to you for
(08:56):
a second, said, and said, I shouldn't say this, but
if he over to Costco, it's going to be like
ten bucks. Ah, I said, really, you said yeah? So
then I saw I went to Costco and it was
ten bucks as opposed to as like ninety bucks. There.
What why?
Speaker 4 (09:12):
How?
Speaker 2 (09:12):
What is that? Is that just purely in the private
industry between like CBS, Walgreens, Rite aiding Costco? Or is
that part of the whole thing.
Speaker 4 (09:20):
Yeah, roughly seventy five percent of the drug market is
controlled by three PBMs prescription benefit managers, and Jack, what
you just said is true. It happens all the time.
You know. One of the things we're doing with smaller employers,
with self funded employers is we're steering them to the
lower cost pharmacies. We have an app built into their phone.
When they get their prescription. We tell them where's the
cheapest place within ten miles at their home to get
(09:41):
that drug, and we show them the price different. Yeah.
Speaker 2 (09:43):
I get it, and it's tools, but it can be worthwhile.
But like now, instead of just always going to the
place closest to my house, which I've done my whole life,
I've got like four different pharmacies, some of them really
a long way away, but it's a much cheaper way
to get the drugs.
Speaker 3 (09:58):
Yeah, everybody has to become a health care bargain hobbyist. Yes, wow, great, Yeah,
Craig gotwaals, Craig the healthcare guru. Really interesting stuff, Craig.
It's you know, it's appalling to me how few Americans
will hear a description as simple, lucid, and undeniable as
(10:19):
our folks just heard. Does nobody have an interest in
reporting this stuff? It affects everybody all the time.
Speaker 4 (10:28):
Well, one that was conspiratorial minded might argue that when
your number one advertiser is this industry, it's really hard
to have people on that talk badly about it.
Speaker 3 (10:41):
It's a good point. Wrong number, a new phone? Who
do is lose our number? Craig, go away, Craig gotwalls. Craig,
It's always a pleasure. We have a link at Armstrong
in getty dot com if you want to get in
touch with Craig and learn more about benefits and drug
prices and that sort of thing. Always good to talk to.
Speaker 2 (10:55):
You, aboud.
Speaker 4 (10:57):
Thanks, gentlemen, have them hit my substat Okay, cool?
Speaker 3 (11:00):
Yeah, sure hit is Substack. We'll have a link to
that too, Armstrong and getdy on. I'm sorry Armstrong geddy
dot com.
Speaker 2 (11:06):
I don't know if I. He says, it's mostly good news,
so that's it's going the right direction on that particular thing.
But I still came away with a bad feeling. I
guess because the whole the healthcare industry being the biggest
industry in the country and the biggest lobbyist in the country.
That's frustrating.
Speaker 3 (11:26):
Yes, and it does have a feel of, you know,
at your job, they don't let you take your lunch breaks.
They punch you in the face regularly at work, and
they've stolen your car five times, and they've announced, hey,
we're gonna let you take your lunch break now.
Speaker 2 (11:41):
I meant
President Biden announcing for the first time ever, Medicare will
begin negotiating drug prices with manufacturers, targeting ten major medications
that treat everything from diabetes to blood cloths to cancer.
The President says it will mean lower healthcare costs for
millions of Americans. As many as nine million seniors take
at least one of the drugs on the list, some
(00:22):
paying up to six five hundred dollars out of pocket
each year. Seniors will see those savings kick in in about.
Speaker 2 (00:28):
Two and a half years.
Speaker 1 (00:29):
The prices have to first be negotiated with those drug companies,
and some of them are already trying to block this
program in court. But still the White House says they're
confident they will win and that the list of drugs
announced today is just the beginning.
Speaker 2 (00:41):
So the question I have any time I hear a
story like that is how true? Is it? Is it
going to matter to me or just other people? So
we thought we'd talked to an expert.
Speaker 3 (00:49):
Yeah, indeed, and that two and a half years from
now thing m Yeah, Craig got Walls. Craig, the healthcare guru,
joins us. He's an attorney, lawn benefit consultant, with benefit Revolution. Craig, Well,
how are you, sir?
Speaker 4 (01:00):
I'm well, how are you, gentlemen? Oh?
Speaker 3 (01:02):
Terrific? Thank you. So what did you make of this?
How significant is it?
Speaker 4 (01:06):
It's a good deal, man. It's you know, when your
dog comes to you after ignoring you for weeks and
weeks and weeks, you don't spank it, right, You reward
the dog for coming to you. And so this is
this is a move in the right direction. Now, the
analogy I would give you, guys is we're in a
canoe in the middle of a lake. It's rocking and rolling,
and we've got a big leak and the water's coming
in rapidly. In our right cup, we have a red
(01:29):
solo cup. That's the Trump Trump transparency regulations. In our
left cup, we now have a dixie cup and we're
bailing that canoe. And this dixie cup is this drug
deal only because it's just ten drugs and it's two
and a half years away. I totally applaud the move.
We need way more of this, But how about all
the drugs starting tomorrow? Right? I mean, this is just
(01:50):
a travesty. We're overpaying. We pay three times what other
countries pay for these same darn drugs and it's just
because it's been all mobbed up for twenty plus years
and can't negotiate with with the drug companies.
Speaker 3 (02:02):
Well, you partially answered my next question. But why such
an incremental move, do you think?
Speaker 4 (02:07):
Well, because, uh, because healthcare is the number one lobby
in the United States and healthcare is the number one
industry in the United States. And it's really bad for
reelection if you say, if you say no, or if
you try and curtail those people that are paying for
your reelection.
Speaker 2 (02:24):
Oh man, yep. So and okay, before I get to
my question, So we're paying three times more than the
rest of the world for the same drugs on average.
Speaker 4 (02:35):
That's actually yes, right.
Speaker 2 (02:37):
That ain't good.
Speaker 4 (02:38):
So nope.
Speaker 2 (02:40):
So the news report there mentioned the drug companies are
trying to you know, they're pushing back, they're trying to
come up with a way around it. Do you think
in two and a half years they'll figure out a
way around it.
Speaker 4 (02:50):
Well, they're certainly going to try. And there are I
counted up yesterday eight lawsuits already filed just on this topic.
So every major drug manufacturer is in on it, and
they want to stop it. Obviously, because that chokes off
their cash cow, don't I don't know if they'll have
success this time around, because you know, we're thirty three
trillion in debt as a country. We are a bankrupt
(03:12):
you know, insurance company effectively with a with a failing military.
So I don't see how I don't see how you
make the argument that we can't do this. I mean,
this one, this one, to me, is a no brainer
that overwhelmingly Republicans and Democrats agree on. I mean, I
think it's something like seven percent of Republicans agree we
should be negotiating these prices, and it's like mid eighties
(03:32):
for Democrats. I'll tell you where this became screwy, gentlemen.
Was it was something we never did. We never negotiated
these prices. Okay, we just accepted whatever bogus off the
shelf price the drug companies wanted, and we paid it
with Medicare and Medicaid.
Speaker 3 (03:49):
Which is bizarre, if I might interject, I mean, can
you imagine bizarre?
Speaker 4 (03:54):
Yeah, imagine if we had to go buy cars that way. Well,
of course, that's kind of how the government does buy cars.
Sticker price for everything. But in two thousand and two,
George Bush wrote this into law. He codified it, which
didn't really change the modus operendi because we weren't negotiating anyway,
but it was again a nod to one of his
largest donor classes, Big Pharma. Then this is where it
(04:15):
gets fascinating. You had pushback on it because Democrats were
against that. Democrats were four price negotiation, and Republicans were
against it. And that went all the way up to
two thousand and nine. And in two thousand and nine,
President Obama realized, there's no way I'm going to get
Obamacare passed unless I get the hospitals, the insurance companies,
and big pharma on my side. So he gave out
(04:38):
little dog treats to each of those industries, and the
dog treat he gave to Pharma was, we will, even
with Obamacare, we will not negotiate drug prices. And then
Obama took money from the healthcare industry, which was something
that Democrats didn't buy and large do at that time.
But what that did is it opened the floodgates. So
now after two thousand and nine, both parties are on
(04:59):
the pay life of the massive lobbies associated with healthcare.
And that's what's kick this can all the way down
the road to twenty twenty three, where finally we got
to do something right. The house is on fire and
all we've got to fire all We've got the garden hose.
So what do we do? We're going to negotiate these
ten two and a half years from now. It's really
similar to what they did with Obamacare. Wow.
Speaker 3 (05:20):
I didn't think I could become more cynical through the
course of a single segment of the show. But I
have you remember when three or four years ago, Craig,
you and I were semi obsessive about figuring out where
we should move where there is liberty and free markets
and that sort of thing.
Speaker 2 (05:34):
Are you still on that way?
Speaker 3 (05:35):
Where would you go right now?
Speaker 2 (05:36):
As an ex pad Portugal?
Speaker 4 (05:38):
That's my latest one is portable Portugal. I just did
a neighbor go there and he's telling me all about it.
It sounds fantastic.
Speaker 3 (05:46):
Wow, Wow, warm Weather beaches, et cetera. Okay, so.
Speaker 4 (05:52):
Maybe I'm going to say, Jack, I want to tell
you guys the story of a drug. I just want
to if I can, if I can fit it in here,
I want to illustrate this point where you just how
corrupt this is. So Aveston and lucentis same drug, same
active components made by Genentech, Lucentus came first. The problem
is Lucentus is thirty eight times more expensive than Aveston.
So Leucentus is used to treat cancer by slowing the
(06:15):
growth of blood vessels that feed the tumors. But innovative
doctors realized, oh my gosh, we could inject a tiny
amount of Aveston into an eyeball in slow macular degeneration.
It worked, it was phenomenal, and in so doing they
used so little it was only sixty dollars per injection. Okay,
So Genentech says, well, we can't have that. We're not
(06:35):
making enough money on it. So genen Tech repackages Aveston,
rebrands it is Loucentus, sells it for the eye, and
charges twenty three hundred dollars per dose, thirty eight times
thirty eight times what doctors were paying to do it.
Then Genentech comes out and says, and by the way,
you can't use Aveston anymore, it's not safe. Honorable ophthalmologist
(06:58):
said that's bs we can still use it. And they
fought it and they sued in genen tech back down. Now,
why would doctors want to prescribe that more expensive drug
because they're paid six percent of the cost of the drug.
So every doctor that was prescribing Loocentus made one hundred
and thirty eight dollars a pop, while every doctor that
was still using the avestin was only making a Starbucks Americano. Wow,
(07:22):
that's just one drug example, Jens, one drug example that
I have followed over the years, and our industry is
riddled with them, riddled with them. So when they come
out and say it's a big deal to negotiate ten
you know what, it's a big deal to negotiate. I'm
happy we're doing it, but we need to be negotiating
all these prices right now. It's our tax dollars. This
is our biggest expense, and we're taking it so lightly
(07:44):
in the face of thirty three trillion in debt.
Speaker 3 (07:46):
Well, and you pile that on top of the discussion
we've had several times about how Obamacare has enriched the
major insurance companies beyond their wildest dreams. That their stock
price has risen seventeen times faster than the S and
P five hundred orld, whatever the number is. It is utterly,
utterly corrupt.
Speaker 4 (08:05):
It is. It is. You know what, I've been in
this industry for twenty two years, gentlemen, I've never been
more cynical. But I'll tell you what, I've also never
been more excited and had more fun because we now
have tools to fight this. And this is going to
give us tools to fight it because every drug they
start to negotiate, the private market will seize upon and
we'll be able to ride those coattails and negotiate lower
(08:26):
prices for themselves as well. So it's a dixie cup
to a flooding canoe. But at least I got a
dixie cup in one hand and a Solo cup in
the other, so we're using them.
Speaker 2 (08:35):
I don't know if my question is like a completely
different topic, but like I always just picked the pharmacy
it was closest to my house or my hospital. That's
the way I always did it because it just seemed easier.
But then, so I was going to buy a drug
at I won't mention the name, but I was going
to buy a drug at one of your popular pharmacies
and they didn't have it. It was a lot, and
the pharmacists actually said, can I talk to you for
(08:56):
a second, said, and said, I shouldn't say this, but
if he over to Costco, it's going to be like
ten bucks. Ah, I said, really, you said yeah? So
then I saw I went to Costco and it was
ten bucks as opposed to as like ninety bucks. There.
What why?
Speaker 4 (09:12):
How?
Speaker 2 (09:12):
What is that? Is that just purely in the private
industry between like CBS, Walgreens, Rite aiding Costco? Or is
that part of the whole thing.
Speaker 4 (09:20):
Yeah, roughly seventy five percent of the drug market is
controlled by three PBMs prescription benefit managers, and Jack, what
you just said is true. It happens all the time.
You know. One of the things we're doing with smaller employers,
with self funded employers is we're steering them to the
lower cost pharmacies. We have an app built into their phone.
When they get their prescription. We tell them where's the
cheapest place within ten miles at their home to get
(09:41):
that drug, and we show them the price different. Yeah.
Speaker 2 (09:43):
I get it, and it's tools, but it can be worthwhile.
But like now, instead of just always going to the
place closest to my house, which I've done my whole life,
I've got like four different pharmacies, some of them really
a long way away, but it's a much cheaper way
to get the drugs.
Speaker 3 (09:58):
Yeah, everybody has to become a health care bargain hobbyist. Yes, wow, great, Yeah,
Craig gotwaals, Craig the healthcare guru. Really interesting stuff, Craig.
It's you know, it's appalling to me how few Americans
will hear a description as simple, lucid, and undeniable as
(10:19):
our folks just heard. Does nobody have an interest in
reporting this stuff? It affects everybody all the time.
Speaker 4 (10:28):
Well, one that was conspiratorial minded might argue that when
your number one advertiser is this industry, it's really hard
to have people on that talk badly about it.
Speaker 3 (10:41):
It's a good point. Wrong number, a new phone? Who
do is lose our number? Craig, go away, Craig gotwalls. Craig,
It's always a pleasure. We have a link at Armstrong
in getty dot com if you want to get in
touch with Craig and learn more about benefits and drug
prices and that sort of thing. Always good to talk to.
Speaker 2 (10:55):
You, aboud.
Speaker 4 (10:57):
Thanks, gentlemen, have them hit my substat Okay, cool?
Speaker 3 (11:00):
Yeah, sure hit is Substack. We'll have a link to
that too, Armstrong and getdy on. I'm sorry Armstrong geddy
dot com.
Speaker 2 (11:06):
I don't know if I. He says, it's mostly good news,
so that's it's going the right direction on that particular thing.
But I still came away with a bad feeling. I
guess because the whole the healthcare industry being the biggest
industry in the country and the biggest lobbyist in the country.
That's frustrating.
Speaker 3 (11:26):
Yes, and it does have a feel of, you know,
at your job, they don't let you take your lunch breaks.
They punch you in the face regularly at work, and
they've stolen your car five times, and they've announced, hey,
we're gonna let you take your lunch break now.
Speaker 2 (11:41):
I meant
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