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mostlysignssomeportents · 2 months ago

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What the fuck is a PBM?

TOMORROW (Sept 24), I'll be speaking IN PERSON at the BOSTON PUBLIC LIBRARY!

Terminal-stage capitalism owes its long senescence to its many defensive mechanisms, and it's only by defeating these that we can put it out of its misery. "The Shield of Boringness" is one of the necrocapitalist's most effective defenses, so it behooves us to attack it head-on.

The Shield of Boringness is Dana Claire's extremely useful term for anything so dull that you simply can't hold any conception of it in your mind for any length of time. In the finance sector, they call this "MEGO," which stands for "My Eyes Glaze Over," a term of art for financial arrangements made so performatively complex that only the most exquisitely melted brain-geniuses can hope to unravel their spaghetti logic. The rest of us are meant to simply heft those thick, dense prospectuses in two hands, shrug, and assume, "a pile of shit this big must have a pony under it."

MEGO and its Shield of Boringness are key to all of terminal-stage capitalism's stupidest scams. Cloaking obvious swindles in a lot of complex language and Byzantine payment schemes can make them seem respectable just long enough for the scammers to relieve you of all your inconvenient cash and assets, though, eventually, you're bound to notice that something is missing.

If you spent the years leading up to the Great Financial Crisis baffled by "CDOs," "synthetic CDOs," "ARMs" and other swindler nonsense, you experienced the Shield of Boringness. If you bet your house and/or your retirement savings on these things, you experienced MEGO. If, after the bubble popped, you finally came to understand that these "exotic financial instruments" were just scams, you experienced Stein's Law ("anything that can't go forever eventually stops"). If today you no longer remember what a CDO is, you are once again experiencing the Shield of Boringness.

As bad as 2008 was, it wasn't even close to the end of terminal stage capitalism. The market has soldiered on, with complex swindles like carbon offset trading, metaverse, cryptocurrency, financialized solar installation, and (of course) AI. In addition to these new swindles, we're still playing the hits, finding new ways to make the worst scams of the 2000s even worse.

That brings me to the American health industry, and the absurdly complex, ridiculously corrupt Pharmacy Benefit Managers (PBMs), a pathology that has only metastasized since 2008.

On at least 20 separate occasions, I have taken it upon myself to figure out how the PBM swindle works, and nevertheless, every time they come up, I have to go back and figure it out again, because PBMs have the most powerful Shield of Boringness out of the whole Monster Manual of terminal-stage capitalism's trash mobs.

PBMs are back in the news because the FTC is now suing the largest of these for their role in ripping off diabetics with sky-high insulin prices. This has kicked off a fresh round of "what the fuck is a PBM, anyway?" explainers of extremely variable quality. Unsurprisingly, the best of these comes from Matt Stoller:

https://www.thebignewsletter.com/p/monopoly-round-up-lina-khan-pharma

Stoller starts by pointing out that Americans have a proud tradition of getting phucked by pharma companies. As far back as the 1950s, Tennessee Senator Estes Kefauver was holding hearings on the scams that pharma companies were using to ensure that Americans paid more for their pills than virtually anyone else in the world.

But since the 2010s, Americans have found themselves paying eye-popping, sky-high, ridiculous drug prices. Eli Lilly's Humolog insulin sold for $21 in 1999; by 2017, the price was $274 – a 1,200% increase! This isn't your grampa's price gouging!

Where do these absurd prices come from? The story starts in the 2000s, when the GW Bush administration encouraged health insurers to create "high deductible" plans, where patients were expected to pay out of pocket for receiving care, until they hit a multi-thousand-dollar threshold, and then their insurance would kick in. Along with "co-pays" and other junk fees, these deductibles were called "cost sharing," and they were sold as a way to prevent the "abuse" of the health care system.

The economists who crafted terminal-stage capitalism's intellectual rationalizations claimed the reason Americans paid so much more for health care than their socialized-medicine using cousins in the rest of the world had nothing to do with the fact that America treats health as a source of profits, while the rest of the world treats health as a human right.

No, the actual root of America's health industry's problems was the moral defects of Americans. Because insured Americans could just go see the doctor whenever they felt like it, they had no incentive to minimize their use of the system. Any time one of these unhinged hypochondriacs got a little sniffle, they could treat themselves to a doctor's visit, enjoying those waiting-room magazines and the pleasure of arranging a sick day with HR, without bearing any of the true costs:

https://pluralistic.net/2021/06/27/the-doctrine-of-moral-hazard/

"Cost sharing" was supposed to create "skin in the game" for every insured American, creating a little pain-point that stung you every time you thought about treating yourself to a luxurious doctor's visit. Now, these payments bit hardest on the poorest workers, because if you're making minimum wage, at $10 co-pay hurts a lot more than it does if you're making six figures. What's more, VPs and the C-suite were offered "gold-plated" plans with low/no deductibles or co-pays, because executives understand the value of a dollar in the way that mere working slobs can't ever hope to comprehend. They can be trusted to only use the doctor when it's truly warranted.

So now you have these high-deductible plans creeping into every workplace. Then along comes Obama and the Affordable Care Act, a compromise that maintains health care as a for-profit enterprise (still not a human right!) but seeks to create universal coverage by requiring every American to buy a plan, requiring insurers to offer plans to every American, and uses public money to subsidize the for-profit health industry to glue it together.

Predictably, the cheapest insurance offered on the Obamacare exchanges – and ultimately, by employers – had sky-high deductibles and co-pays. That way, insurers could pocket a fat public subsidy, offer an "insurance" plan that was cheap enough for even the most marginally employed people to afford, but still offer no coverage until their customers had spent thousands of dollars out-of-pocket in a given year.

That's the background: GWB created high-deductible plans, Obama supercharged them. Keep that in your mind as we go through the MEGO procedures of the PBM sector.

Your insurer has a list of drugs they'll cover, called the "formulary." The formulary also specifies how much the insurance company is willing to pay your pharmacist for these drugs. Creating the formulary and paying pharmacies for dispensing drugs is a lot of tedious work, and insurance outsources this to third parties, called – wait for it – Pharmacy Benefits Managers.

The prices in the formulary the PBM prepares for your insurance company are called the "list prices." These are meant to represent the "sticker price" of the drug, what a pharmacist would charge you if you wandered in off the street with no insurance, but somehow in possession of a valid prescription.

But, as Stoller writes, these "list prices" aren't actually ever charged to anyone. The list price is like the "full price" on the pricetags at a discount furniture place where everything is always "on sale" at 50% off – and whose semi-disposable sofas and balsa-wood dining room chairs are never actually sold at full price.

One theoretical advantage of a PBM is that it can get lower prices because it bargains for all the people in a given insurer's plan. If you're the pharma giant Sanofi and you want your Lantus insulin to be available to any of the people who must use OptumRX's formulary, you have to convince OptumRX to include you in that formulary.

OptumRX – like all PBMs – demands "rebates" from pharma companies if they want to be included in the formulary. On its face, this is similar to the practices of, say, NICE – the UK agency that bargains for medicine on behalf of the NHS, which also bargains with pharma companies for access to everyone in the UK and gets very good deals as a result.

But OptumRX doesn't bargain for a lower list price. They bargain for a bigger rebate. That means that the "price" is still very high, but OptumRX ends up paying a tiny fraction of it, thanks to that rebate. In the OptumRX formulary, Lantus insulin lists for $403. But Sanofi, who make Lantus, rebate $339 of that to OptumRX, leaving just $64 for Lantus.

Here's where the scam hits. Your insurer charges you a deductible based on the list price – $404 – not on the $64 that OptumRX actually pays for your insulin. If you're in a high-deductible plan and you haven't met your cap yet, you're going to pay $404 for your insulin, even though the actual price for it is $64.

Now, you'd think that your insurer would put a stop to this. They chose the PBM, the PBM is ripping off their customers, so it's their job to smack the PBM around and make it cut this shit out. So why would the insurers tolerate this nonsense?

Here's why: the PBMs are divisions of the big health insurance companies. Unitedhealth owns OptumRx; Aetna owns Caremark, and Cigna owns Expressscripts. So it's not the PBM that's ripping you off, it's your own insurance company. They're not just making you pay for drugs that you're supposedly covered for – they're pocketing the deductible you pay for those drugs.

Now, there's one more entity with power over the PBM that you'd hope would step in on your behalf: your boss. After all, your employer is the entity that actually chooses the insurer and negotiates with them on your behalf. Your boss is in the driver's seat; you're just along for the ride.

It would be pretty funny if the answer to this was that the health insurance company bought your employer, too, and so your boss, the PBM and the insurer were all the same guy, busily swapping hats, paying for a call center full of tormented drones who each have three phones on their desks: one labeled "insurer"; the second, "PBM" and the final one "HR."

But no, the insurers haven't bought out the company you work for (yet). Rather, they've bought off your boss – they're sharing kickbacks with your employer for all the deductibles and co-pays you're being suckered into paying. There's so much money (your money) sloshing around in the PBM scamoverse that anytime someone might get in the way of you being ripped off, they just get cut in for a share of the loot.

That is how the PBM scam works: they're fronts for health insurers who exploit the existence of high-deductible plans in order to get huge kickbacks from pharma makers, and massive fees from you. They split the loot with your boss, whose payout goes up when you get screwed harder.

But wait, there's more! After all, Big Pharma isn't some kind of easily pushed-around weakling. They're big. Why don't they push back against these massive rebates? Because they can afford to pay bribes and smaller companies making cheaper drugs can't. Whether it's a little biotech upstart with a cheaper molecule, or a generics maker who's producing drugs at a fraction of the list price, they just don't have the giant cash reserves it takes to buy their way into the PBMs' formularies. Doubtless, the Big Pharma companies would prefer to pay smaller kickbacks, but from Big Pharma's perspective, the optimum amount of bribes extracted by a PBM isn't zero – far from it. For Big Pharma, the optimal number is one cent higher than "the maximum amount of bribes that a smaller company can afford."

The purpose of a system is what it does. The PBM system makes sure that Americans only have access to the most expensive drugs, and that they pay the highest possible prices for them, and this enriches both insurance companies and employers, while protecting the Big Pharma cartel from upstarts.

Which is why the FTC is suing the PBMs for price-fixing. As Stoller points out, they're using their powers under Section 5 of the FTC Act here, which allows them to shut down "unfair methods of competition":

https://pluralistic.net/2023/01/10/the-courage-to-govern/#whos-in-charge

The case will be adjudicated by an administrative law judge, in a process that's much faster than a federal court case. Once the FTC proves that the PBM scam is illegal when applied to insulin, they'll have a much easier time attacking the scam when it comes to every other drug (the insulin scam has just about run its course, with federally mandated $35 insulin coming online, just as a generation of post-insulin diabetes treatments hit the market).

Obviously the PBMs aren't taking this lying down. Cigna/Expressscripts has actually sued the FTC for libel over the market study it conducted, in which the agency described in pitiless, factual detail how Cigna was ripping us all off. The case is being fought by a low-level Reagan-era monster named Rick Rule, whom Stoller characterizes as a guy who "hangs around in bars and picks up lonely multi-national corporations" (!!).

The libel claim is a nonstarter, but it's still wild. It's like one of those movies where they want to show you how bad the cockroaches are, so there's a bit where the exterminator shows up and the roaches form a chorus line and do a kind of Busby Berkeley number:

https://www.46brooklyn.com/news/2024-09-20-the-carlton-report

So here we are: the FTC has set out to euthanize some rentiers, ridding the world of a layer of useless economic middlemen whose sole reason for existing is to make pharmaceuticals as expensive as possible, by colluding with the pharma cartel, the insurance cartel and your boss. This conspiracy exists in plain sight, hidden by the Shield of Boringness. If I've done my job, you now understand how this MEGO scam works – and if you forget all that ten minutes later (as is likely, given the nature of MEGO), that's OK: just remember that this thing is a giant fucking scam, and if you ever need to refresh yourself on the details, you can always re-read this post.

The paperback edition of The Lost Cause, my nationally bestselling, hopeful solarpunk novel is out this month!

If you'd like an essay-formatted version of this post to read or share, here's a link to it on pluralistic.net, my surveillance-free, ad-free, tracker-free blog:

https://pluralistic.net/2024/09/23/shield-of-boringness/#some-men-rob-you-with-a-fountain-pen

Image: Flying Logos (modified) https://commons.wikimedia.org/wiki/File:Over_$1,000,000_dollars_in_USD_$100_bill_stacks.png

CC BY-SA 4.0 https://creativecommons.org/licenses/by-sa/4.0/deed.en

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alostwanderernotfound · 3 months ago

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PANDEMICS- Hostile Power Takeover? Learnings on Urban & Domestic Warfare, “Disease: Bacteria Part 1, Fundamental Considerations”:

Let’s say the hostile power is more technologically advanced & half robot/half machine or full machine, so seemingly unkillable. Organic beings are very vulnerable to having disease used as a weapon against them.

Disease can be a major benefit to this type of hostile power & it would be an incredibly powerful weapon. This allows the destruction of an organic-based domestic population & it can also allow the harvesting of resources to build new bodies and/or reuse of the entire body depending on the disease process.

There are many insidious ways diseases develop & spread. This process DOES NOT just occur in a laboratory. Remember that there are many different “groupings” of entities we refer to as pathogens or things with the ability to cause disease.

Bacteria are an important one. Bacteria & other pathogens can reproduce by multiple means. Here I’m going to speak about bacteria with the capacity to do Bacterial conjugation. This involves passing characteristic between two different bacteria similar to how sexual reproduction can pass on characteristics. This is overall an important conversation because a lot of the most complex & common life forms in our daily lives also spread these characteristics through similar principles through sexual reproduction.

> A lot of bacteria to our awareness are able to pass on characteristics. Bacterial DNA contains the “instructions”/“resources” for bacteria to either have or not have characteristics.

-Bacterial conjugation for example allows one bacteria to attach to a second bacteria & send resources to the second bacteria. After this process, the second bacteria is able to transform and display the characteristics transferred to it. Example: Bacteria A can change colors like a chameleon. Bacteria B cannot change color. Once Bacteria A attaches to Bacteria B and they are compatible, Bacteria A passes on resources to Bacteria B. Bacteria B then acquires the ability to change color. Bacteria B now can change color & has attainted the same advantage as originally only bacteria A had. Now Bacteria A and Bacteria B can change color like a chameleon.

- The other way characteristics form & occur in a bacterial population is through mutation. If a bacteria’s DNA is altered or mutates then it can produce a bacteria with new traits & characteristics. Radiation for example, like from X-rays, often causes mutations. Sometimes mutations do “nothing” we can really perceive with our eyes. But overtime, they will eventually create large changes and can produce huge benefits for bacteria. For example: A bacteria could have always have been wiped out from nuclear weapons then overtime from mutations it can acquire the ability to survive living inside an area with nuclear radiation.

-This is a very important concept to fully understand so that you can become cognizant of how insidious this process is when discussing what bioterrorism in the modern world can look like. Pandemics are not caused just from mysterious lab leaks. The practices we do everyday are still contributing to the next pandemic occurring.

-This also gives everyone a better understanding of how MRSA or an antibiotic resistant bacteria really was “made” inside our hospitals.

> Bacteria can possibly have random or genetically engineered characteristics.

-If there are 100 random bacteria on an isolated surface that formed there naturally, some will have favorable characteristics to cause severe disease. But, some bacteria will not have those characteristics to cause severe disease. The bacteria lacking these deadly characteristics, but are still part of the same family of bacteria, would be considered weaker pathogens (weaker pathogen meaning they would cause less severe disease in organic beings).

-**But it is important to remember, If someone purposefully put bacteria down on a surface there is a chance it will not be a random distribution in strength of bacteria & they will mostly all be bacteria with strong characteristics. That group would probably be closer to 100 out of 100 of the bacteria carrying the deadly characteristic.**

>There are 2 main basic premises (which can be further subdivided and added onto when discussing what makes pathogens strong, but for now I’m discussing a more fundamentals explanation) we consider when determining bacterial pathogen strength: number of bacteria & the amount of deadly/harmful characteristics each bacteria possess.

-Reducing the overall number of bacteria in a group of random bacteria does not always mean you make a pathogen less strong. (Example: Purposefully killing 50 bacteria out of 100 and now there are only 50 bacteria in the group.)

If you destroy many of the weaker bacteria & only leave strong bacteria to reproduce, pathogens overtime can get stronger & more deadly. So, by destroying only the weaker bacteria in a group of bacteria, you slowly make pathogens stronger through this natural process & it doesn’t have to occur inside of a laboratory. To make a bacterial pathogen less strong by focusing on decreasing the overall number of those bacteria that exist in our world, you would also have to consider how many of each strength you eliminate. This is because we currently we do not use practices that wipe out groups of bacteria 100%, so we must consider these two elements together instead of separate when evaluating pathogen strength. Example: Lets say there are 100 bacteria and you wipe out 90. Bacteria A can cause humans to be paralyzed. Bacteria B cannot paralyze humans. Out of the 10 bacteria still alive, if all 10 are Bacteria A then you have eliminated the chance people would be infected with the less severe version of the disease, with Bacteria B. In the long term Bacteria A now has a strong chance to reproduce & when Bacteria A infects people it would then cause paralysis in everyone & the population could collapse. In another scenario, consider if you wiped out 90 bacteria out of 100, but you did it purposefully. Out of the 10 bacteria left, 9 were Bacteria that were Bacteria B & couldn’t cause paralysis. The last 1 out of the 10 left was Bacteria A. Then when those 10 bacteria reproduced it effectively helps “dilute” this negative characteristic in this bacterial family. Based off randomness & probability, when there this group reproduces to the size of 20 bacteria only approximately 2 of them may carry Bacteria A’s paralytic characteristic & 18 will carry bacteria B’s characteristic that does not cause paralysis. So, even though we can’t stop the bacteria number from growing, since we mindfully intervened we can still divert the trajectory of the pathogen from becoming a pathogen with the ability to become “pandemic level” and/or very very harmful.

>Two ways pathogens can get weaker is by lowering the amount of bacteria in the world & by lowering its severe disease characteristics, but this these two categories have an important interplay.

-This is an oversimplified explanation of how disease spreads & evolves, but the fundamental principles are VERY important to the overall understanding of what’s occurring. Imagine a group of bacteria you count has 100 total bacteria. 50 of them carry a gene to cause paralysis in humans & 50 do not carry this gene. When 100 people come in contact with the 50/50 bacteria distribution and get sick only 50 out of 100 of the people get paralyzed. This allows the other 50 people time to work on vaccinations & interventions to stop everyone from eventually being paralyzed.

-But, if you kill the 50 out of the 100 bacteria that do not carry the gene for paralysis then your bacteria group went from 100 to a total of 50 in size. In the short term the spread of the disease is likely to go down, as it is less likely people will randomly spread 50 objects instead of 100. BUT, those 50 bacteria with the gene to cause paralysis will only reproduce with other bacteria that also have that gene. So this bacteria, since you wiped out the 50 that don’t cause paralysis, now ALL cause paralysis & anyone who comes in contact with this bacteria strain will get paralyzed. So eventually with time the group of 50 bacteria will reproduce to 100 & spread at the same rate as they were originally, but now they cause more harm to people.

>When you unknowingly touch a colony of bacteria on an object or life form, you pick up a random sample of random “strength” of bacteria.

>****PLEASE READ: you can ALSO pickup a sample of bacteria that is all “strong bacteria” but this is NOT usually a natural occurrence you will see & is suggestive someone or something altered the bacteria and purposefully put those bacteria there. A group of bacteria that looks like it formed organically vs one that was purposefully placed there can be differentiated with taking samples of surfaces and people & counting how many strong bacteria vs weak bacteria there are, but we as a population do not regularly test for this in this way. Due to this I’m going to speak with the viewpoint of natural bacteria groups that have a gradient of “strengths”. In an ideal world we would identity groups of bacteria that have gradients of strength of bacteria vs groups of all similar strength, as interventions to stop them from becoming strong pathogens work DIFFERENTLY.)

>After you touch those bacteria they attempt to multiply and stay alive on you. Then if you touch other things they can be placed on another surface or thing. Sometimes they are placed on other surfaces in an environment or you touch your body & they are placed closer to an entrance to the inside or your body & then they are able to enter your body.

-This process will cause one of the following to occur: bacteria will stay in the area you touched & colonize it, they will die when attempting to enter the body, the bacteria will give you a disease , or in some cases the bacteria will live symbiotically inside you & help your body. If a bacteria lives symbiotically with you & does not cause harm then we do not refer to that as a pathogen, but rather just as a bacteria.

>Anytime you wipe out a group of bacteria by taking out 100% it causes that pathogen to get weaker overall, but the issue is that we do not do interventions that wipe out 100%.

-Currently anytime you clean an object in the hospital with a sanitizing wipe, you always kill less than 100% of the bacteria. This leaves behind a certain % of bacteria & they will be the strongest of that group of bacteria, because they were able to live even though you applied a cleaning product on them. This means the strongest bacteria left, even though there are less after cleaning, are now reproducing over and over again & getting stronger.

-So, when there is an environment with a large amount of bacteria variability (so all these new patients with new exposures to new bacteria that travel and touch things all the time), with shared equipment, with not 100% effective methods to destroy pathogens, & this long list of variables, we slowly produce very strong & deadly pathogens inside of hospitals.

-IF someone purposefully puts deadly bacteria ontop of a surface inside a hospital and it is a group of 100 strong & identical or cloned bacteria with no difference in genetics then wiping them out through imperfect cleaning will overall reduce pathogen deadliness. This is because there are no “stronger” pathogens vs “weaker” pathogens. They are all the same strength in this example and therefore will always get weaker when you reduce their number because they won’t reproduce to be more deadly.

>People often think when people are trying to cause them harm that would only occur when someone makes a pathogen in a lab & then deceptively goes and places some near you. This is not accurate.

-With knowing this do you see how for a hostile power there is actually LESS incentive to going through with all that work & instead a hostile power can abuse the system to cause harm? If you expect biological warfare to ONLY come out of a lab, this means you would be looking for the wrong patterns of behavior & pathogens will spiral out of control.

A lot of practices we currently use now unfortunately heavily contribute to this process that causes pathogens to get stronger.

#pathogens #doctor #medicine #physician assistant #nursing #nurse #registered nurse #evolution #disease #bacteria #np #nurse practitioner #pa #md #rn #meds #pharmacy

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