Presidential Candidate Edwards' Health Care Plan Includes Drug Patent Process Overhaul

Main Category: Health Insurance / Medical Insurance
Also Included In: Public Health
Article Date: 19 Jun 2007 - 13:00 PDT

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Democratic presidential candidate and former Sen. John Edwards (N.C.) on Thursday in Detroit offered details of his universal health care proposal, including cost cutting measures such as overhauling the patent process for breakthrough pharmaceuticals and requiring that health insurers spend at least 85% of premiums collected on patient care, the AP/Houston Chronicle reports (Gustafson, AP/Houston Chronicle, 6/14).

Edwards' proposal, announced in February, also would require employers to provide health insurance for workers or contribute 6% of their payrolls to a fund that would help individuals purchase coverage. Edwards said that his proposal would cost $90 billion to $120 billion annually and that he would fund the plan through the elimination of tax cuts proposed by President Bush and approved by Congress for households with annual incomes more than $200,000 (Kaiser Daily Health Policy Report, 6/14).

Edwards proposed offering cash incentives in place of long-term patents for certain breakthrough drugs. The incentives would allow multiple companies to produce generic and other versions of those drugs, resulting in lower prices, Edwards said. According to campaign officials, the payments could be voluntary for drug companies and would aim to encourage drug development (AP/Houston Chronicle, 6/14). Edwards said, "Giving them the cash up front will help bring generic drugs to the market quicker."

The pharmaceutical industry criticized the proposal, saying that long-term patents are necessary for an industry that spends large amounts of money on drug development. Ken Johnson, senior vice president of the Pharmaceutical Research and Manufacturers of America, said, "Health care proposals offered by members of Congress and presidential candidates should strengthen -- not weaken -- the current patent system so that patients can access new medicines to help them win their battle against disease" (Gray, Detroit Free Press, 6/15).

Additional Details
Edwards said his plan also would require that at least 85% of premiums paid to insurance companies are used for patient care, noting that 30% of premiums collected currently go to administrative costs and profits. According to Edwards, New York, Minnesota, New Jersey and Florida already have similar requirements.

In addition, the plan would mandate that all U.S. residents obtain health insurance and would establish measures to reduce administrative costs for providers and improve chronic and preventive care (AP/Houston Chronicle, 6/14). Edwards proposed the creation of "medical homes" to help treat patients with chronic conditions and provide U.S. residents with "a continuum of care from the time they are born until they die." He also said that new ways are needed to train more nurses, particularly in urban and rural areas (Josar, AP/Detroit News, 6/15).

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