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Health Care

Additional Health Care Mandates Only Add to the Business Challenge of Rising Health Costs

By | Around the States, Health Care, Shopfloor Main, Shopfloor Policy | No Comments

Manufacturers consistently rank rising health care costs as a primary business challenge according to the National Association of Manufacturers Outlook Surveys conducted each quarter. The manufacturing industry has a history of leading the business community in providing health benefits to employees—98 percent of NAM members provide health insurance to employees and they do so because it is the right thing to do for their workforce and their families.

New health care mandates will continue to challenge the ability of employers to provide self-funded health care innovations that help control costs. Since manufacturers have a proud tradition of providing health care to employees, manufacturers are eager to explore ways to reduce health care costs and strengthen ERISA – the Employee Retirement Income Security Act of 1974. The economies of scale that have come to define employer-sponsored coverage, create a vehicle through ERISA to design benefits that are flexible, innovative and efficient. However, this approach only works if health care innovation is encouraged and permitted. Employers can no longer be strangled by additional regulations or the burdens of 50 different ways to comply which is why ERISA plans and their sponsors work hard to contain costs. Manufacturers want our employees to thrive, be healthy and share in our success as manufacturers.

Oklahoma is now considering a new mandate that will impact how and where pharmacy benefit coverage is provided, potentially requiring an open-ended pharmacy network and mandated reimbursement requirements outside the scope of many pharmacy benefit plans that Oklahoma employers will have to cover.

HB 2632 and S 841 represent a wrong-headed approach. The NAM agrees with the State Chamber of Oklahoma and urges legislators to fully understand the cost impacts of yet another health care mandate thrust on employers and their employees.

Innovation Should Not Be A Scapegoat for Rising Health Care Costs

By | Around the States, Health Care, Innovation, intellectual property, Shopfloor Main, Shopfloor Policy | No Comments

Cutting-edge advancements in pharmaceutical medicine improves lives and reshapes the health care industry as we know it every day. Innovation fuels progress, and America’s biopharmaceutical manufacturers are leading the way toward developing solutions to the greatest health care challenges, as they always have. The results are clear: more new medicines are created in the United States than every other country in the world combined. Unfortunately, some states have pursued and continue to pursue legislation to address rising health care costs that would stifle innovation—neither improving care for patients nor reducing health care costs in the process.

Minnesota House File 1246 would threaten intellectual property rights by requiring manufacturers to disclose highly-sensitive proprietary information, creating unnecessarily burdensome requirements that are contrary to the free and competitive market that has allowed biopharmaceuticals to develop new life-saving treatments. Our country far outpaces others in the discovery of new cures because of our emphasis on innovation that is carried out through robust research and development and protected by vigorous intellectual property rights. Degrading those rights degrades the progress they make possible.

The legislation being considered in Minnesota will not lower prescription drug costs nor address the rising cost of health care. Manufacturers support solutions to address rising health care costs, but as the manufacturing sector accounts for more than three-quarters of all private sector R&D in the United States and receives more patents than any other industry, proposed solutions must not come at the cost of crippling the biopharmaceutical sector’s innovation.

The Future is Bright When We Lead With Innovation

By | General, Health Care | No Comments

Tomorrow, the Senate Finance Committee will hold a hearing on the cost of medicine. No doubt, this is an issue that is impacting millions of Americans and it’s good that Congress is continuing its discussion of lowering health care costs. Manufacturers urge Congress to focus on solutions that are market-based and that recognize the unique global leadership role biopharmaceutical manufacturers in America play. Why? More new medicines are created in the United States than every other single country in the world—combined. America’s biopharmaceutical manufacturers have come up with cures for the uncurable, they’ve worked to eradicate entire diseases from the face of the planet, they’ve brought hope to millions and they continue to overcome nearly every impossibility placed before them. The fact that our country far outpaces every other country in the discovery of new cures is no coincidence.  While the system we have can certainly use improvements—such as better aligned incentives that promote value to both patients and their employers who sponsor health insurance—Congress should take care not to do so at the expense of the development of the best-in-class treatments of tomorrow that can bring hope and healing to so many more who are suffering today.

In addition to leading the way on innovative new cures, biopharmaceutical manufacturers are also leaders in research and development (investing more in R&D than any other industry) and employment in the STEM fields. Jobs in this sector of manufacturing are extremely well-paying, with an average annual salary of $80,458.

Chronic conditions like diabetes, heart disease, asthma and others continue to increase health care costs. Medicines and new treatments are the way to stabilize these conditions so that people can remain healthy and productive. With this in mind, manufacturers look forward to tomorrow’s hearing and we look forward to working with policymakers on solutions on the cost of medicine that are market-based, pro-innovation, and reject the kind of socialist ideas that could destroy our country’s global leadership in developing the cures of tomorrow.

 

International Pricing Index Proposal Veers Away from Market-Based Principles and Puts Government in the Driver’s Seat

By | Health Care, Shopfloor Policy | No Comments

Before the year closed out, the National Association of Manufacturers (NAM) requested the administration reconsider its proposed International Pricing Index (IPI) model for Medicare Part B drugs and urged the administration to maintain free market principles as well as the spirit of open competition. The IPI model, if implemented as designed, would send a strong signal that future treatments should be more limited for patients and controlled by the government, thereby curtailing the incentive for the development of new cures. In the comment, the NAM stressed:

The proposed shift to an international pricing model for certain classes of medicines and treatments highlighted in the ANPRM do not offer a fair or a comparable benchmark for prices in the United States. The HHS/CMS proposal highlights 14 nations, including many with government-run national health systems that operate off a dramatically different set of values and cost controls. Many of these systems differ markedly from the American market-based system that provides consumer choice and honors innovation. Grafting those approaches onto our innovative, free-market economy would be highly problematic, undercutting innovation, failing to reward health outcomes and neglecting to address many of the most important cost drivers in our own health care system.

Manufacturers support a successful and affordable health care system that honors innovation, protects intellectual property and avoids government-driven demands that are contrary to basic free market principles. Health care stakeholders—including makers of medicines and patients—should not be presented with false choices in efforts to improve affordability. Reforming existing programs are important endeavors that must be pursued, but maintaining critical market-based approaches should not be sacrificed in these efforts.

Michigan’s Drug Pricing Proposal Would Cripple Innovation

By | Health Care, Shopfloor Main, Shopfloor Policy | No Comments

From cutting-edge advancements in automobile production to lifesaving developments in medical devices and medicines, Michigan manufacturers are global innovators and at the top of their game. As detailed in the National Association of Manufacturers’ recent economic analysis, the manufacturing industry in Michigan spent $17.2 billion on research and development (R&D) in 2015, ranking it fourth nationally. One key to this success is ensuring all manufacturers’ intellectual property rights continue to be protected.

Unfortunately, legislation currently being debated in Lansing threatens manufacturers’ intellectual property protections. House Bill (HB) 5223, a proposed drug pricing transparency bill, would require manufacturers that distribute prescription medicines in Michigan of a certain cost to submit a substantial amount of proprietary data, including costs associated with R&D, to the state Department of Health and Human Services, with no protections for the data submitted.

Manufacturers understand the need to reduce health care costs, but we have serious concerns related to the long-term implications of pharmaceutical transparency proposals. Protection of trade secrets and other forms of intellectual property are a fundamental necessity for manufacturers to succeed in today’s intensely competitive global marketplace.

The latest proposal in Michigan sends a wrong signal to the researchers, inventors and innovators who constitute the manufacturing community in Michigan and the rest of the nation who are constantly thinking of new ways to innovate, grow their businesses and serve their customers. For the biopharmaceutical industry, this kind of so-called “transparency” legislation would stifle innovation and impede the ability of companies to bring new, lifesaving medicines to market all while failing in its intent to contain health care costs.

Policymakers in Michigan and at the federal level should work to create opportunities that help innovators attract and retain investment. The NAM opposes any efforts that invalidate longstanding intellectual property and trade secrets protections and force manufacturers of medicines to heed new government-driven demands that are contrary to basic free market principles.

The manufacturing industry employs more than 604,500 Michiganders in high-skilled and high-wage jobs—the nation’s third-highest manufacturing state measured by employment. State lawmakers who value these critical jobs and the state’s innovative manufacturing sector should reject the proposed legislation.

Congress Sees the Importance of Addressing ACA Taxes Now, Not Later

By | Health Care, Shopfloor Main, Shopfloor Policy, Taxation | No Comments

When it comes to Obamacare (i.e., the Affordable Care Act, or ACA), Democrats and Republicans haven’t found much to agree upon. That’s why it was particularly notable when bipartisan consensus emerged last year around the need to do something about some of the law’s worst taxes: the medical device tax, the health insurance tax (or “HIT”) and the so-called “Cadillac” tax, which is a 40 percent tax increase on “high-quality” health benefit plans. Members in both parties said they believed these taxes at least needed to be delayed from their planned implementation dates, which is why it was so disappointing when legislation did not ultimately pass to do so. The good news is that Congress can still take action on the issue in the upcoming short-term government-funding bill, or CR, that the House plans to consider this week. Congressional passage would take a step in the right direction by allowing the implementation of these taxes to be delayed at various times.

The medical device tax, the HIT and the Cadillac tax were not designed to last due to their burdens, high cost and complexity. That’s why manufacturers have repeatedly urged Congress for much-needed relief from these job-killing taxes. A recent letter to House and Senate leaders can be found here. Unfortunately, the medical device tax and the HIT went into effect this year but the pressure to delay them did not let up. For the medical device tax, the first collection of the 2.3 percent tax comes later this month. Also, the HIT comes online in the form of higher health insurance premiums totaling $22 billion for more than 100 million Americans nationwide. Manufacturers are already planning for the 2020 Cadillac tax, with implementation beginning this year.

Manufacturers need certainty to negotiate health plans with affordable premium costs and best-in-class benefits for our employees. Ultimately, that means these taxes need to be repealed entirely. Members in both parties agree. We’ll continue pushing to get that result. But the CR that the House is prepared to vote on this week offers an important solution in the interim. While not a long-term solution for manufacturers or their employees, it is progress that the National Association of Manufacturers welcomes. We hope the House and Senate will pass this delay and continue working with us on a long-term solution.

Innovation and Continued Reforms Critical to Combating Rising Health Care Costs

By | Health Care, Shopfloor Policy | No Comments

Yesterday morning, the Senate Committee on Health, Education, Labor and Pensions held a hearing to discuss a report by the National Academies of Sciences, Engineering and Medicine on the cost of prescription drugs.

The National Association of Manufacturers (NAM) sent a letter to the committee encouraging an approach that is focused on policies and reforms that are in step with the next generation of health care delivery and the development of new medicines.

No one is more frustrated with rising health care costs than manufacturers. Over the course of the year, a significant number of NAM members have reported premium increases of at least 10 percent annually. In addition, manufacturers consistently rank rising health care costs as a top primary business challenge according to past NAM Outlook Surveys conducted each quarter.

Unfortunately, the National Academy of Sciences report is shortsighted and recommends approaches that will shift costs to the private sector. Furthermore, the report questions the critical importance of intellectual property protections and unfairly blames rigorous intellectual property rights for inhibiting more affordable treatments.

Improving outcomes, boosting innovation incentives and continuing to reduce the approval process for new medicines are a better focus than additional government interventions. Value-based arrangements that focus on outcomes are encouraging, but outdated regulations need to be modernized to achieve greater acceptance, savings and increased efficiencies.

Protecting intellectual property and trade secrets for all manufacturers is critical to the success of the entire manufacturing industry. It is what gives manufacturers assurance that the billions of dollars and time spent developing new products are worth the investment. Without the right incentives, innovation will be curtailed, and competition in the marketplace will decline.

Manufacturers are always ready for health care solutions and will work on efforts that support a successful, competitive and affordable health care system.

Looming Deadlines on Health Care Taxes Require Urgent Action

By | Health Care, Shopfloor Policy | No Comments
While manufacturers are disappointed that the Senate was unable to pass a full repeal of the Patient Protection and Affordable Care Act (ACA) in July, legislative efforts to combat the negative consequences of the ACA must not only continue but also be resolved before new taxes raise health care costs.The manufacturing industry has a history of leading the business community in providing health benefits to employees; 98 percent of National Association of Manufacturers’ members provide health insurance to employees. For that tradition to continue, Congress must act quickly to prevent the job-killing ACA-related taxes from going into effect in 2018. That means taking quick and decisive action when the House and Senate return from their August recess.

A new Oliver Wyman report just released demonstrates the Health Insurance Tax (HIT) will result in higher health insurance premiums totaling $22 billion for more than 100 million Americans nationwide. This ACA tax will be paid by many, including those who are “fully insured,” meaning those employers who work directly with insurance brokers to purchase employee health plans. Even retirees who are accessing insurance through Medicare Advantage programs will be hit by the HIT.

For manufacturers who are fully insured and those purchasing individual plans, this tax only adds to rising costs and higher premiums. Joe Eddy, president and CEO of Eagle Manufacturing, told his story before the House Education and the Workforce Committee earlier this year. He explained the ACA taxes and compliance burdens “have been costly, disruptive and distracting from the things we are good at doing as manufacturers.”

According to the Oliver Wyman report summarized here, the HIT could raise the cost of premiums by an additional $540 for employees’ families receiving health benefits from fully insured larger employers. Small business owners and their employees could shoulder an additional $500 for family coverage as a result of the HIT. These cost increases are preventable if Congress acts. Manufacturers provide competitive health benefits to attract and maintain skilled employees and because manufacturers know it’s the right thing to do. Congress should be making it easier to provide insurance, not more difficult.

Regrettably, it’s not just the HIT. The medical device tax—another tax that discourages innovation, growth and job creation—is ready to go into effect next year. In 2015, a temporary suspension of the 2.3 percent excise tax on medical device manufacturers was enacted after 29,000 jobs were lost as a result of the misguided tax. However, that two-year relief runs out at the end of 2017, making full repeal of this tax critical to manufacturers of medical devices. Manufacturers support immediate action to permanently repeal the medical device tax to prevent this tax from eliminating jobs and hurting local economies in all 50 states.

It was unfortunate that the Senate did not pass major health care reform legislation in July, but manufacturers urge the Senate not to give up efforts. Both the House and Senate must advance opportunities to address the burdensome taxes associated with the ACA because the deadlines are around the corner and the clock is ticking.

 

FDARA Reauthorization Critical to Advancement of Lifesaving Medicines

By | Health Care, Shopfloor Policy | No Comments

This morning, the Senate is voting on H.R. 2430, the Food and Drug Administration Reauthorization Act of 2017 (FDARA), hopefully with the affirmative action of sending the bill to President Donald Trump’s desk. The bill was passed by the House of Representatives with overwhelming bipartisan support in July.

As noted in a National Association of Manufacturers’ letter to the Senate, “FDARA is the ultimate public–private partnership that supports patients who need lifesaving medical treatments while promoting science, research and technological innovation.”

Manufacturers in America lead the nation in research and development (R&D), driving more innovation than any other sector. Pharmaceutical manufacturers, in particular, account for nearly one-third of all manufacturing R&D. In turn, the United States is a global leader in the development of medical breakthroughs.

Reauthorization of the FDA’s user-fee program would support the research pipeline and accelerate the development of new medicines and treatments. The NAM supports the Senate’s effort to act quickly in voting to reauthorize FDARA as it stands before adjourning for recess. Any delay to this critical legislation would jeopardize America’s position as a global leader in medical discovery.

Senate Must Address Health Insurance Tax and Other Burdens Associated with the ACA—the Clock Is Ticking

By | Health Care, Shopfloor Policy, Taxation | No Comments

Efforts to stop the impacts of the onerous Health Insurance Tax (HIT) must continue as the Senate debates health care legislation. This $100 billion tax levied on fully insured health plans is paid by consumers and, if left unaddressed, will be a shock to retirees on Medicare Advantage and Part D plans as well as employers, individuals and families who purchase off-the-shelf health care plans. That tax will go into effect next year.

Manufacturers are fully behind repealing the “Cadillac” tax, the medical device tax, the health insurance tax and the pharmaceutical tax as well as reducing the burden of the employer mandate. The National Association of Manufacturers sent a key-vote letter to the Senate on Wednesday in support of Amendment 271 to underscore the importance of action on these issues. Unfortunately, the amendment failed in a 45–55 vote.

A full repeal of the Affordable Care Act (ACA) will help employers contain rising health care costs and provide much-needed predictability so that manufacturers can continue providing quality health care to employees. Manufacturers encourage the Senate to unlock the stranglehold of the ACA on manufacturers.

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