Americans Don't Love Their Private Insurance After All

Plus, how Trump's new tax law is working

Despite Pressure from Trump and Lawmakers, Drug Prices Keep Rising

Prescription drug prices are surging in 2019, despite pressure from the Trump administration and lawmakers on pharmaceutical companies and public anger about the cost of medications.

CBS News’s Aimee Picchi reports: “So far in 2019, more than 3,400 drugs have boosted their prices, a 17% increase compared with the roughly 2,900 drug price increases at the same time in 2018, according to a new analysis by Rx Savings Solutions, a consultant to health plans and employers.” The data is preliminary, and the pricing picture could still change when more information is available.

The average price hike for those drugs over the past six months has been 10.5%, smaller than the 15% for the same period last year but still about five times the rate of inflation.

Drugmakers have typically pushed through price hikes at the beginning of January and July. On Monday, for example, 20 companies raised the list prices of more than 40 drugs by an average of 13.1%, according to data from Rx Savings Solutions cites by The Wall Street Journal. A year earlier, 16 companies raised the list prices of dozens of drugs by an average 7.8%.

But the dynamics of drug pricing have changed somewhat, perhaps as the result of manufacturers growing wary of public and political scrutiny they face. “Many pharmaceutical companies have pledged to raise their drugs’ list prices by less than 10% each year,” the Journal’s Jared S. Hopkins writes.



He adds that, over the first quarter of 2019, list prices for branded drugs in the United States increased 3.3%, compared with 6.3% a year earlier, according to SSR Health LLC pharmaceutical analysts. And over the past six months, the top 100 U.S. drug brands and 30 smaller brand-name medications saw prices increase by a more modest average of 3.1%, according to industry analysts cited by Politico.

Many large drugmakers skipped the July 1 round of price increases, and some products did see prices decrease.

At the same time, drug companies have begun to stagger their price increases to avoid drawing attention, RX Savings Solutions CEO Michael Rea told Politico.

The bottom line: "The data has something for everyone in it," one industry analyst told Politico. "That said, it’s hard to imagine what [drugmakers] are thinking. Keeping your head down would seem to be a much better strategy." But those pharmaceutical companies also face pressure from shareholders to grow their profits — and the prescription drug market is inelastic, as Rea told CBS. "It's a good that people need, in many cases in order to stay alive," he said. "You have a lot of flexibility to drive prices higher and higher." Some companies that didn’t raise prices Monday may still do so soon.

Most Americans Back Eliminating Private Insurance — if They Can Keep Their Doctor: Poll

As Democrats debate Medicare for All and their presidential contenders navigate the politically treacherous question of whether to call for the elimination of private insurance, a new poll from Politico and Morning Consult finds that American voters are mostly concerned about maintaining access to their preferred health care providers rather than specific coverage plans.

The survey, conducted from June 29 through July 1, after the first Democratic presidential primary debates, finds that support for Medicare for All falls from 53% to 46% when voters are told that the role of private insurers would be diminished. But it jumps back up to 55% when voters are told that such a plan would still let them keep their doctors and hospitals.

“These numbers only affirm what the senator has said many times: people don’t like insurance companies, they like their doctors and their hospitals,” Sanders’ campaign said in an email to Morning Consult.

The poll surveyed 1,472 voters and has a margin of error of 3 percentage points.

A related new poll, conducted for CNN and released Monday, found that 56% of respondents said the government should provide a national health insurance program for all Americans. But 32% said that such a program should not completely replace private insurance compared to 21% who said it should. Half of Democrats and Democratic-leaning independents said that a government health program shouldn’t replace private coverage.

Even so, Vermont Sen. Bernie Sanders, whose Medicare for All proposal calls for eliminating most private insurance, came out on top when those Democrats and Democratic-leaning independents were asked which presidential contender can best handle health care. Sanders (26%) was followed by former Vice President Joe Biden (18%) and Massachusetts Sen. Elizabeth Warren (16%).

The CNN poll was conducted by SSRS from June 28 through June 30. It involved 1,613 adults and has a margin of error of 3 percentage points or larger.

How the Tax Cuts and Jobs Act Performed in Its First Year

In some respects, the 2018 tax year wasn’t that different from the year before, says Richard Rubin of The Wall Street Journal. According to new data from the IRS, 79% of taxpayers received refunds averaging $2,879 on their 2018 returns, Rubin reports, not far off from the 80% of taxpayers receiving refunds worth an average $2,908 for 2017.

But in other ways, the tax overhaul changed how important components of the tax system performed.  Here’s are some highlights from Rubin’s analysis:

Tax liability fell for all income groups. “Overall, with 0.5% more returns filed through May 23, adjusted gross income rose 5%, reflecting the strong economy, wage growth and changes to what deductions are allowed,” Rubin says. “Tax liability dropped 6%.”

Tax penalties increased. Fewer people owed penalties for the 2018 tax year, thanks in part to a temporary easing of the rules, but those who did owe penalties paid more — 24% more compared to 2017, and that number will likely rise after late filings are processed in the fall.

More taxpayers claimed the standard deduction. The tax law nearly doubled the standard deduction and placed a cap on state and local tax deductions, reducing the benefit of using itemized deductions for many filers. About 90% of filers used the standard deduction for 2018, compared to 70% the year before.

AMT was much less prominent. Many upper-income households used to pay the alternative minimum income tax, but the AMT “is virtually gone for households making under $1 million,” Rubin says. “For every 62 AMT payers in 2018, there is one in 2019.”

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One game to go. The U.S. women's national soccer team will play for the World Cup title on Sunday after defeating England 2-1 in a tight, tense match. They'll next face the winner of Wednesday's game between Netherlands and Sweden.

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Number of the Day: $203,500

The Wall Street Journal’s Catherine Lucey reports that acting White House Chief of Staff Mick Mulvaney is making a bit more than his predecessors: “The latest annual report to Congress on White House personnel shows that President Trump’s third chief of staff is getting an annual salary of $203,500, compared with Reince Priebus and John Kelly, each of whom earned $179,700.” The difference is the result of Mulvaney still technically occupying the role of director of the White House Office of Management and Budget, where his salary level is set by law.

The White House told the Journal that if Mulvaney is made permanent chief of staff his salary would be adjusted to the current salary for an assistant to the president, $183,000.

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