In gridlocked Washington, both Democrats and Republicans have signaled there’s potential for a deal when it comes to lowering prescription drug prices. Now, there’s an idea both Congressional Democrats and the White House seem to like: They want to base U.S. prices on something called an international price index.

“The basic idea is to peg what the United States pays for a particular drug to the price paid in some set of other countries,” says Rachel Sachs, an associate professor of law at Washington University in St. Louis who specializes in drug pricing policy. “There are many different ways to identify other countries, and there are many different ways in which that international reference price could be used to negotiate for a price here.”

House Speaker Nancy Pelosi unveiled her sweeping plan to reduce drug prices Thursday, which included an international price index. There are lots of differences between that plan and the one the White House floated last fall, but the basics — and the appeal of the concept — are the same.

“It stops drug companies from ripping off Americans while charging other countries less for the drug,” Pelosi said in a press conference announcing the House plan, which would use drug prices in Australia, Canada, France, Germany, Japan, and the United Kingdom to create a baseline in negotiating prices.

She’s speaking President Trump’s language. Here’s what he told reporters in July: “Why should other nations like Canada — why should other nations pay much less than us? They’ve taken advantage of the system for a long time, pharma.”

Earlier this summer, the Department of Health and Human Services sent its own IPI proposal to the White House for review, though the details haven’t been made public. The idea of establishing an IPI is the only element of the administration’s plan to lower prescription drug prices still on the table — other ideas, like displaying list prices in TV ads and ending secret rebates for middlemen have been withdrawn or blocked in the courts.

A glimpse of what the HHS proposal might look like can be found in the outline of a Medicare model HHS released last fall. Like the House Democrats’ plan, the HHS model uses an index of countries to generate an average price. But, unlike the House plan, it would not let the secretary of HHS use that average to negotiate directly with drugmakers.

The HHS outline is also more limited in the drugs that would be eligible for this sort of price-setting. Medications eligible would be only a subset of drugs used by Medicare patients — mostly injections given in doctor’s offices — whereas the House plan would extend to a wider group of 250 brand-name drugs.

Another difference? “The House Democrats’ proposal envisions a non-compliance fee that would financially penalize drug companies who won’t bargain in a good-faith way with the administration,” Sachs says. “There’s no such enforcement mechanism in the administration’s IPI proposal.”

Both plans would use the average price internationally for each drug as a benchmark in negotiations, so that Americans don’t pay more than about 20% above what people in other countries pay. That’s still more than what people pay outside the U.S., but less than they pay now.

“The prices the U.S. is currently paying today can be two or three times as much, [though it] varies a lot by product,” says Stacie Dusetzina, a professor of health policy at Vanderbilt University School of Medicine. “This would be a major price reduction.”

One example of a drug priced much higher in the U.S. than elsewhere is Humira, a brand name rheumatoid arthritis drug. In 2015, it cost $2,669 a month in the U.S., while the list price in the U.K. was about half that — $1,362. The same drug cost only $552 in South Africa, according to the International Federation of Health Plans.

“I believe that the price of Humira now in the U.S. is about $63,000 a year,” says Ben Wakana, executive director of the advocacy group Patients for Affordable Drugs. “And [the drugmaker] AbbVie has raised the price eleven times between 2014 and 2018.” Wakana has a personal connection to Humira — his brother. In the U.S., there’s no generic competition that might push the price down, he notes.

“For patients like my brother and like the thousands of people who take Humira every year, that price is simply too high,” Wakana says. “We need competition. And if we can’t get competition, then we need to be able to negotiate with AbbVie for a fair price — like they are offering in other countries.”

So, would establishing an international price index actually work to lower drug prices?

The Trump administration projects that, in five years, using its IPI would save Medicare patients $3.4 billion. Policy analysts have argued that the amount patients would save is actually a bit murkier because many Medicare patients who use these drugs also have supplemental insurance. In addition, because so many countries — 24 in Europe alone — use this kind of indexing, there’s the risk of a circular effect, with everybody looking to their neighbor instead of basing the cost of the drug on concrete measures of the medicine’s clinical value or the costs of developing and producing it.

In Canada, the government already uses international drug list prices in negotiations, and has recently made moves to go even further.

“The comparison of our list prices in Canada to the list prices in other countries has proven to be not very effective at controlling the real price of medicines in this country,” says Steve Morgan, a professor of health policy at the University of British Columbia. One reason for that, he says, is that list prices don’t reflect real prices after drugmaker rebates. So now, he says, “Canada is trying to implement further price regulations that would make sure that the final negotiated prices are reasonable.”

In the United States, many Republican lawmakers and conservative groups have opposed the idea of an international index — arguing that it runs against free market principles.

Unsurprisingly, drugmakers also object. “Speaker Pelosi’s radical plan would end the current market-based system that has made the United States the global leader in developing innovative, lifesaving treatments and cures,” Stephen Ubl, CEO of lobbying group PhRMA, says in a written statement. “We do not need to blow up the current system to make medicines more affordable.”

But Pelosi and her allies seem to be betting there is political will to go against drugmakers this time. Despite the huge sums spent on lobbying, the pharmaceutical industry is now the most unpopular industry in the country, according to a recent Gallup poll. And with a presidential election coming up, Americans polled say lowering drug prices is a top priority.

This could mean there’s room for the House and the White House to work together, especially on an idea like an international price index that they’ve both proposed.

“We do hope to have White House buy-in,” Pelosi said Thursday. “That seems to be the route to getting any votes in the United States Senate, and certainly we want as strong a bipartisan vote as we can in the House and the Senate. So we would hope that they would support this.”

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Two days before his wedding this past April, Cameron Fischer had one heck of a bachelor party, hitting a few bars in the Old Town section of Fort Collins, Colo., with his friends into the wee hours. The next morning, the 30-year-old IT professional from nearby Loveland woke up with a killer hangover.

“I couldn’t keep anything down,” Fischer says. “I just felt miserable.”

He was in such bad shape that, with their wedding day fast approaching, Fischer’s fiancée urged him to leave their rehearsal dinner in Denver and head to an emergency room to be rehydrated.

That resulted in an even bigger headache: a medical bill that was initially $12,460, all told. That was more than twice the cost of their wedding.

Fischer had run into a sobering fact about America’s health care system. With few constraints on how emergency rooms set prices, hospital systems have jacked up rates and coded patient visits as being more complex than they would have previously, which increases the payments they receive from insurance plans. The result: ER services have some of the fastest-growing prices in the health care system.

Many health economists think free-standing ER facilities, like the one Fischer visited — which are banned in many states but thriving in Colorado — are particularly culpable. While such ERs maintain that they can’t survive on rates paid by Medicare and Medicaid, data suggest they are profit-seeking engines built primarily in high-income ZIP codes.

“It’s because they’ve figured out that they can get away with it,” says Vivian Ho, an economist with the Baker Institute for Public Policy at Rice University in Houston.

Fischer might have avoided the big bill had he sought treatment earlier in the day. But by 7 p.m. on a Saturday, urgent care facilities were closed. He checked Google Maps for the closest emergency room and — clutching a trash can — headed to HealthONE North Suburban Medical Center, a free-standing ER in the Denver suburb of Thornton.

The ER appeared to be devoid of patients, with just a doctor and a couple of nurses on duty. Fischer told them what had happened and that he didn’t do drugs and doesn’t often drink.

“I knew exactly why I was there,” he says. “It wasn’t that I had some unknown reason for my symptoms.”

A nurse started an IV and gave Fischer two bags of saline and a dose of Zofran, an anti-nausea medication. She drew blood; Fischer says he wasn’t told what tests would be run on the blood sample. He was out of the ER within 45 minutes, feeling much better.

Facility fees as the price of entry

A few weeks after Fischer’s April wedding, he received the medical bill.

It included a $7,644 “facility fee.” That’s an expense that hospital systems charge to cover their overhead costs of keeping an ER open 24 hours a day and ready for any emergency.

Facility fees are set on a scale from 1 to 5, depending on how severe the patient’s condition appears during the initial triage. The ER rated Fischer’s visit as a 4, one of moderately high complexity, in terms of care needs.

“There are no limitations on the facility fees that they can charge,” says Adam Fox, director of strategic engagement for the Colorado Consumer Health Initiative, a nonprofit consumer advocacy group. “The facility fee for over $7,000 is simply obscene,” Fox says.

The Health Care Cost Institute, an independent, nonprofit health research firm, recently analyzed millions of insurance bills to get a better sense of the facility fees that ERs are charging. It found the charges nearly doubled from 2009 to 2016, outpacing overall health spending four times over. In Colorado, the average facility fee charged for a Level 4 visit grew from $1,064 to $2,336.

Insurance plans generally don’t pay the full charge but pay a negotiated rate for in-network hospitals. The Center for Improving Value in Health Care, which maintains a database of insurance payments in Colorado, found that insurance plans paid an average of $1,754 for a Level 4 facility fee in 2018.

Still, those prices pale in comparison with the fee charged to Fischer. “That seems like an outlier on the high end,” says John Hargraves, a senior researcher at the Health Care Cost Institute who led the ER study. “That’s more than triple what it was in 2016.”

Other studies have found that ERs are coding visits at the higher 4 and 5 complexity levels at higher rates than in past years. It’s not clear whether that reflects a deliberate attempt by hospital systems to increase payments or a shift in the type of patients who visit emergency rooms. It’s possible the growth in urgent care centers is siphoning off less complex cases.

Treatment costs for a hangover

The ER’s initial bill included $500 for a complete blood count — a test that the online price comparison tool Healthcare Bluebook says could be had for less than $20 in a doctor’s office. It charged more than $1,300 for a complete metabolic panel, a routine test that generally costs about $31.

The two liters of saline, which the ER billed at $700, are available at Walmart for $10.99 a liter.

And spa-like hydration services in Denver market IV fluids for hangover relief, consisting of the same combination of saline and nausea meds that Fischer received in the ER, for just $168.

The ER bill also included $970 for a drug test, something Fischer says he never consented to undergo. Medicare typically pays health care providers about $114 for the same test.

“When you look at the bill, obviously the prices are astronomical,” Fischer says. “But it was also the work that was performed without my authorization that was pretty frustrating.”

HealthONE officials say the prices at its ERs are higher than at urgent care clinics or other outpatient settings because the ERs are staffed by board-certified emergency physicians and cannot turn away any patients, regardless of their ability to pay. So paying patients who show up in their ERs subsidize those who show up and can’t pay.

“The move toward higher-deductible insurance plans has put a strain on many of our patients, but we understand their choice to pay a lower monthly premium, and we also understand their frustration with the larger out-of-pocket expenses they may experience as a result,” HealthONE North Suburban Medical Center spokeswoman Betty Rueda-Aguilar said in a written statement to Kaiser Health News. She adds that Fischer presented with symptoms of alcohol poisoning and had to be treated accordingly. The company declined our requests for an interview.

Emergency rooms tend to lose money on critically ill patients, as well as on Medicare, Medicaid and uninsured patients, says Dr. Jesse Pines, national director of clinical innovation for US Acute Care Solutions, which helps staff more than 200 hospitals and ERs. These facilities try to make up the difference with less sick, privately insured patients, like Fischer, Pines says.

“To make the economics of an emergency department work, those patients have to subsidize the system to make the difference balance out,” he adds.

But as more privately insured patients have high-deductible plans, he says, it has been harder and harder for hospitals to collect on their bills from patients who don’t pay.

Free-standing ERs

Free-standing ERs, such as North Suburban, may have found a way to skew their patient mix toward those who can pay. A report from the Colorado Health Institute finds that free-standing ERs tend to locate in high-income neighborhoods. Residents there are more likely to have higher-paying commercial insurance, rather than Medicare or Medicaid, and are likelier than other patients to be able to pay for out-of-pocket costs their insurance doesn’t cover.

Colorado has more than 50 free-standing ERs, according to the report, trailing only Texas and Ohio. The facilities are licensed as “community clinics and emergency centers,” a designation originally developed to help rural and underserved communities in Colorado that could not otherwise afford inpatient hospitals. But the report identifies only eight free-standing emergency departments in rural Colorado — all in affluent ski resort towns.

For Fischer, the negotiated rates under his health plan knocked the $12,460 bill down to $4,694. The plan paid $2,102. That left Fischer with a bill of $2,593, an amount he says he cannot afford to pay.

“That’s quite the expensive bachelor party,” Fischer says.

Kaiser Health News is a nonprofit, editorially independent program of the Kaiser Family Foundation and is not affiliated with Kaiser Permanente.

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In the first three months after getting his Dexcom continuous glucose monitor, Ric Peralta managed to reduce his average blood sugar level by three percentage points.

“It took me from not-very-well-managed blood sugar to something that was incredibly well managed,” says Peralta, a 46-year-old optician in Whittier, Calif., who was diagnosed with Type 1 diabetes in 2008.

Peralta was so enthused that he became a “Dexcom Warrior,” a sort of grassroots spokesman for the product. It became hard to imagine life without his new monitor, a device that lets him keep track the trends in his blood sugar 24 hours a day on his smart phone. And yet, he’s spent weeks at a time without the device over the past year because of problems with insurance restrictions. Physician groups and patients consider those rules overly burdensome, but insurance groups defend them as necessary.

Diabetes activists and legislators have started to focus attention on the surging price of insulin, leading to legislative pushes, lawsuits and congressional hearings. But insulin isn’t the only thing people with Type 1 diabetes are struggling to get. Managing the condition requires other essential, often life-saving medical supplies. And patients frequently face hurdles in getting access to those supplies — hurdles put in place by insurance companies.

A life changing device

Peralta learned about the Dexcom continuous glucose monitor from the mother of one of his patients. He visited the company’s website and, within two weeks, the device had been shipped to his front door.

“I still didn’t 100 percent appreciate exactly how it was going to change my life,” Peralta says. “It was amazing.”

Typically, people with Type 1 diabetes check their blood sugar by drawing a drop of blood from their finger and placing it on a disposable test strip that’s read by a blood glucose meter. Doctors suggest checking blood sugar this way between four and 10 times per day. These readings are crucial for helping people with diabetes manage their blood sugar — keeping it from getting too low, which can lead to sudden seizures and loss of consciousness, as well as from getting too high, which can cause vision loss, nerve damage and can even, over time, lead to amputations.

Instead, Peralta’s continuous glucose monitor gave accurate blood sugar readings every five minutes. That’s 288 readings per day, or about 278 more readings than even the most conscientious patients get the old-fashioned way.

“When I had to do the old-fashioned finger prick test, I was only doing that right before I ate, so I could see how much [insulin] I was supposed to take,” Peralta says. (People with Type 1 diabetes have to take multiple daily shots of insulin to keep their blood sugar within normal range because their bodies stop producing the naturally occurring hormone.)

“I didn’t realize that I had rather severe [blood sugar] peaks and valleys in between my meal times,” Peralta says.

Tighter control of blood sugar can reduce the risk of heart disease, kidney failure and nerve damage. For Peralta, it also offered peace of mind.

The monitor sounds an alarm when his blood sugar is getting dangerously low; Peralta says his coworkers have started bringing him sugary snacks when they hear the alarm, to help him raise his blood sugar back up to normal. When he takes his family on road trips — a favorite activity — he no longer has to worry about the possibility of passing out while he’s driving.

“It even syncs with my car so I can just say, ‘Siri, what’s my blood sugar?’ And it will come over the car stereo system,” Peralta says. “I’m safe for my family.”

Prior-authorization requirements

When common chronic conditions such as diabetes are well controlled, it prevents worsening disease and saves money for the health system and the patient.

But Peralta says his efforts to use this new tool consistently to manage his diabetes have been stymied by insurance problems that began about a year ago.

The newest Dexcom continuous glucose monitor has three parts: a sensor that measures glucose levels, a transmitter that sends out the sensor’s readings wirelessly, and a receiver that displays those readings on a screen.

For each of these parts, Peralta needs something called a “prior authorization” from his insurer — a requirement from his insurance company that necessitates his physician seeking approval from the insurance company before prescribing the device.

The Dexcom sensors last about 10 days each and Peralta’s insurance allows him to buy a three-month supply at a time. But he also has to get prior authorization for each supply, meaning every three months his doctor needs to reconfirm with his insurance company that the sensors are medically necessary. Same goes for the device’s transmitters — which last about six months each.

“I have to jump through hoops and they have to jump through hoops to get information from my insurance to get authorization,” Peralta says in frustration, adding, “for the last year, basically every time there’s been something that’s gone wrong.”

“Prior authorizations are in place to protect patients, to improve safety and to try to make sure that the care they receive is as safe as possible and also as affordable as possible,” says Kate Berry of the trade group America’s Health Insurance Programs.

But to Ric Peralta, the requirement is a burden.

The most recent snafu happened in March. Peralta ordered a new supply of sensors directly from Dexcom but says the company submitted a request for approval of a new transmitter, as well. And because his insurance approves the sensors and transmitters on different authorization timelines, the whole claim was denied. Peralta estimates he spent four hours on the phone with Dexcom and his insurer over the next month and a half to sort it all out. During that time he had to revert to finger stick tests.

“It’s maddening,” Peralta says. “If I do not have my proper management of this disease I’m going to die from it. And they’re making it as difficult as possible.”

A burden on doctors, too

Prior authorizations have become a major concern of physicians across the U.S. health care system, as evidenced by a December 2018 survey by the American Medical Association.

Of the 1,000 physicians surveyed, 91 percent said prior authorizations “have a negative impact on patient clinical outcomes;” 75 percent said the requirements “can at least sometimes lead to patients abandoning a recommended course of treatment;” and 28 percent said the prior authorization process had “led to serious or life-threatening events” for their patients.

“In my practice we have five individual physicians, and we hired five full-time employees whose primary duty is obtaining prior authorization and dealing with insurance companies,” says Dr. Bruce Scott, an otolaryngologist from Kentucky and Vice Speaker of the AMA House of Delegates.

“Prior authorization is a burden on providers and diverts valuable resources,” Scott says. “That’s a problem.”

The AMA has even created a website that catalogs stories of patients and providers who say they’ve struggled to gain access to important medical products and procedures because of problems getting prior authorizations from insurers — everything from pain medication for a cancer patient to X-rays in the ER. Scott says the AMA doesn’t expect insurers to completely do away with requirements for prior authorization, “but we believe that it should be focused and that it should be better planned.”

The American Association of Clinical Endocrinologists — an organization of the physicians whose specialty is often associated with diabetes treatment — goes even further.

“We feel that physicians that are specialists in endocrine disease should not be required to fill out prior authorizations for endocrine treatments,” says Dr. Scott Isaacs, an endocrinologist from Atlanta and member of the board of directors of AACE.

“It’s a huge burden for the patients trying to get this sorted out. Sometimes it’s red tape; sometimes it’s a true denial,” Isaacs says. “It’s a huge burden for the doctors as well, and the doctors resent it.”

Berry, of the insurance group AHIP, acknowledges that there’s room for improvement in the prior authorization process. In fact, in January 2018, the AMA and AHIP signed a consensus statement identifying five areas for improvement. It was cosigned by the American Hospital Association, the American Pharmacists Association, the Blue Cross Blue Shield Association and the Medical Group Management Association.

Who bears the greatest burden?

For Ric Peralta, the ultimate burden of getting all these prescriptions filled falls on him and patients like him.

After his latest mix-up with the sensors in March, he discovered the battery in his transmitter had died.

Peralta made another frustrated call to Dexcom, and recently got a complimentary transmitter to get him back on the system while his formal order goes through the approval process.

“I’m quite nervous about what’s going to happen again in two months when I am needing to call in orders again,” Peralta says.

“Am I going to have to go through this whole thing over again?”

This story is part of NPR’s reporting partnership with Kaiser Health News. Bram Sable-Smith is a freelance reporter based in Madison, Wisc., who often covers health care. Reach him on Twitter: @besables.

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Austin is about to become the first city in the U.S. to fund groups that help women who seek abortions pay for related logistical costs, such as a babysitter, a hotel room or transportation.

The move is an effort to push back against a new Texas law that went into effect Sept. 1. The state law bans local governments from giving money to groups that provide abortions — even if that money doesn’t pay for the actual procedure.

Last week, the Austin City Council approved a line item for the city’s latest budget that, as of Oct. 1, sets aside $150,000 to pass along to nonprofits led by abortion rights activists that provide “logistical support services” for low-income women in the city.

Supporters of the new city budget item describe it as a unique workaround to the state’s law, because none of these groups actually provide abortions.

“The city has to find creative ways to help vulnerable communities in our city, and I see this as just another way,” says Councilwoman Delia Garza, Austin’s mayor pro tem.

John Seago, the legislative director for Texas Right to Life, says that though Austin is not violating the letter of the state law, its leaders are clearly violating “the principle” behind it.

“The Legislature did not believe that it is ethical to use taxpayer dollars to benefit the abortion industry,” Seago says. “So whether it is the clinic itself, whether it is paying for the procedure itself, there is an industry built around that that we don’t want to use taxpayer dollars to benefit.”

Shortly after the city’s budget was passed last week, former Austin Councilman Don Zimmerman sued the city in an effort to block the funding. In his lawsuit, filed in a Travis County district court, Zimmerman claimed “this expenditure of taxpayer money violates the state’s abortion laws.”

Supporters of Austin’s effort say the budget item is on solid legal ground. They also say it’s an important step in ensuring that low-income women, at least locally, can obtain legal abortions in a state that has been steadily scaling back access to the procedure in the past decade.

Erika Galindo, an organizer with the Lilith Fund, told the Austin City Council during a meeting this summer that Austin should take a stand as some cities pass all-out bans on abortion. In fact, earlier in the summer, Waskom — a small city in East Texas — banned the procedure and declared itself the state’s first “sanctuary city for the unborn.”

“The city of Austin has an opportunity to set a new standard for creative and equitable solutions for communities at a time when state lawmakers and local governments like Waskom’s city council have turned their backs on low-wage workers and women of color,” Galindo said.

Austin’s city leaders say the makeup of their city council also likely played a small role in the decision to fund these programs. While Waskom’s ban was passed by an all-male council, Austin’s majority-female city council decided to take a different approach.

“I don’t think it’s any coincidence that you have a majority-female council making these kinds of issues a priority,” Garza says. “We have seen how this right has been chipped away at — all kinds of barriers being placed in front of women who are simply seeking an option that is still a constitutional right in this country.”

The city’s leaders and staff are still working out how women will qualify for the money and what groups to contract with, but it’s expected that some groups that are already doing this work across the state will be getting city support.

Among those groups is Fund Texas Choice, a statewide nonprofit group that provides travel arrangements for abortion appointments for women in Texas who can’t afford them. Sarah Lopez, an organizer with the group, says the group’s help can include providing women with gas money, bus tickets or ride-shares — and sometimes a hotel room to recuperate in.

More often than not, Lopez says, she’s helping women who are already parents and who can barely afford the procedure itself — let alone all the costs that come with actually making it to the appointment. For many of these women, she says, just a little help goes a long way.

“I was chatting with someone yesterday,” Lopez says. “She had just made her appointment but then rescheduled because she was like, ‘Oh, I didn’t realize I would have to be gone for three or four days — so I had to push my appointment another week and a half in order to find child care.’ ” (Texas law requires at least two office visits before a woman can get an abortion. And women living in rural parts of the state often have to travel 200 miles away, or more, to the closest abortion clinic.)

The groups that facilitate such support won’t be able to use Austin’s allocated funds for women who reside outside the city, though. And in Texas, travel barriers are even bigger outside major cities.

In 2013, Texas lawmakers passed a controversial law that imposed strict restrictions on abortion providers in the state. That law, known as House Bill 2, required clinics to be equipped and staffed like surgical centers, and it required doctors who provide abortions to have admitting privileges at a nearby hospital. Following that law’s passage, many clinics around the state shut their doors.

Even though the U.S. Supreme Court eventually struck down those restrictions, many of these clinics have yet to reopen – especially the clinics that closed in rural parts of Texas.

Despite Austin’s new plan, women living in parts of the state that don’t have a clinic will still have to rely on statewide programs such as the one run by Lopez’s group — and such programs have limited budgets. Still, Lopez says, Austin’s effort does take some of the pressure off such groups financially and frees up more money for women living in rural areas.

“I think it’s incredible,” Lopez says of the Austin decision. “I really hope to see that other cities in Texas kind of follow suit.”

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