Over the course of the last thirty years or so there have been several inflection points that I thought had the potential of rendering our healthcare system so expensive that major reform would be inevitable. For example, I thought the AIDS crisis, as it appeared in the 1980s and early 1990s, had that potential but that’s a bullet we’ve dodged.
We’ve reached another of those crossroads:
Federal Medicare officials are embracing medical guidelines for the treatment of hepatitis C that could result in tens of thousands of older Americans getting access to expensive new drugs that can cure the deadly infection.
This policy change would pay for treatment with a combination of new, expensive drugs for patients who haven’t responded to older treatment regimens and are approaching or have cirrhosis of the liver.
The shift has come about because of an Arizona man named Walter Bianco who was twice denied Medicare coverage for two new drugs that together cost about $150,000.
The potential total cost of that change of policy could result in an increase in spending of billions or tens of billions by the Medicare system which, in turn, would hasten the insolvency of the Medicare trust fund, presently anticipated in 2026 (we’ll get an update on that from the trustees soon). That wouldn’t necessarily provoke a fiscal crisis since the federal government is a monetary sovereign but it would provoke a political crisis and I honestly have no idea of its outcome.
And then there’s the Medicaid system.