One of the major factors in the high cost of health care is the high cost of drugs, and as Ms. Margot Sanger-katz notes in her article “The Real Reason Medicare Is a Lousy Drug Negotiator: It Can’t Say No” (The New York Times 2/2/2016) that Presidential candidates have offered various approaches to decrease the cost of life-saving drugs. Specifically, Mrs. Clinton, Mr. Sanders, and Mr. Trump has called for better negotiating strategies by the U.S. federal government for Medicare drug prices. Unfortunately, as Sanger-katz writes, “But if you talk to experts who study the pharmaceutical market in the United States, they aren’t optimistic that, by itself, letting the government play drug negotiator would take a big bite out of prescription drug spending.”
Newer drug costs money due to the cost of research, marketing, paying out dividends to investors, and other expenses incurred from running a pharmaceutical company. Developing new drugs are expensive, and the costs are passed down to consumers. However, the people that need the newly developed drugs the most are not necessarily able to pay for them. And even if the U.S. government subsidizes those drugs completely to the economically disadvantaged drug users, the rest of the country have to pay for the high drug cost.
The key question is how can we reduce the cost of newly developed drugs while keeping the pharmaceutical companies competitive in the global drug market? Simply putting a cap on drugs might run the risk of putting certain drugs out of the market due to unsustainable price limits for the pharmaceutical companies. Nevertheless, the pharmaceutical companies had no specific price control regulations and price on some of the life-saving drugs are too costly for the health care system to keep general health care cost sustainable.
There does not seem to be any viable solution to this problem, but if there is a potential solution, the drug companies and public officials need to come together as partners to devise such a solution, not merely antagonize each other. Because if drug companies decide to pull their drugs out of the U.S., then the patient that need them most will face severe consequences.
Virginia Governor McAuliffe gave his State of the Commonwealth on Wednesday, and the Democrat Governor focused on cooperating with the Republican-led state legislators to continue making progress on the state budget and other policies.
Governor McAuliffe’s State of the Commonwealth paints a bright future for Virginia, but the Governor warns legislators that now is the key opportunity to make significant progress as a threat of another federal sequestration looms in two years.
“The New Virginia Economy” was the focus of the State of the Commonwealth. One of the Governor’s goals is to transform the state education and workforce training sector to meet the private sector demands of highly trained workers.
The Governor also noted on his ongoing goal to develop the state economy by wooing high-growth industries, such as biotech and cyber security sectors. The Governor also stressed the importance of global trade in the Virginia economy by stating the need to make regulatory changes to make goods easier to be imported and exported in the Commonwealth. To illustrate on the state’s progress on global trade, the Governor noted that Virginia apples are now being sent to India.
While mentioning the economic success of the Commonwealth, the Governor spread the credit everyone in state government. By showing a conciliatory tone to his Republican counterparts, the Governor signaled that he want to focus on continue making progress by cooperation than engaging in partisan battles.
The Governor did warn that he will veto any legislation that would undermine gay marriage, undercut gun safety policies, threaten woman’s access to healthcare, and policies undermining the progress against climate change. Nevertheless, the Governor maintained his warm, conciliatory tone with the Republican legislator by making his veto threats a small part of his address.
The strong economy of Virginia has made the friendly tone of the State of the Commonwealth speech possible. Citing a relatively low unemployment rate compared to other east coast states, the Governor used the opportunity to spread the credit around, including to state Republicans. By warning of a possible federal sequestration in two years, the Governor wants full cooperation from the legislative body on matters of state investment on education and workforce training during the drafting of the state budget. By having a stronger economy and a well-trained workforce within two years, the Governor is attempting to minimize the negative economic impact from a possible federal sequestration.
Based on the brevity of his discussion on gun safety and expansion of Medicaid, the Governor is not expected to introduce any significant progressive agenda this year. His priority seems to be legislative cooperation to further develop the state economy.
Also, by stressing on past successes of existing state programs, the Governor is trying to win support from fiscally conservative legislators that many of the state programs are worthy, necessary investments. Policy-wise, the Governor is not expected to propose new state programs per se but instead propose increasing funding that are designed to improve existing state programs.
The next 60 days will be crucial for Governor McAuliffe to carry out proposals mentioned in his State of the Commonwealth address.
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