The adventures of flawed national healthcare

[kscarbel2]

Obama administration confirms double-digit premium hikes

Associated Press  /  October 24, 2016

Premiums will go up sharply next year under President Barack Obama's health care law, and many consumers will be down to just one insurer, the administration confirmed Monday. That's sure to stoke another "Obamacare" controversy days before a presidential election.

Before taxpayer-provided subsidies, premiums for a midlevel benchmark plan will increase an average of 25 percent across the 39 states served by the federally run online market, according to a report from the Department of Health and Human Services. Some states will see much bigger jumps, others less.

Moreover, about 1 in 5 consumers will only have plans from a single insurer to pick from, after major national carriers such as UnitedHealth Group, Humana and Aetna scaled back their roles.

"Consumers will be faced this year with not only big premium increases but also with a declining number of insurers participating, and that will lead to a tumultuous open enrollment period," said Larry Levitt, who tracks the health care law for the nonpartisan Kaiser Family Foundation.

Republicans pounced on the numbers as a warning that insurance markets created by the 2010 health overhaul are teetering toward a "death spiral." Sign-up season starts Nov. 1, about a week before national elections in which the GOP remains committed to a full repeal.

"It's over for Obamacare," Republican presidential candidate Donald Trump said at a campaign rally Monday evening in Tampa, Florida.

Trump said his Democratic rival, Hillary Clinton, "wants to double down and make it more expensive and it's not gonna work. ... Our country can't afford it, you can't afford it." He promised his own plan would deliver "great health care at a fraction of the cost."

The new numbers aren't too surprising, said Sen. Orrin Hatch, R-Utah, who chairs a committee that oversees the law. It "does little to dispel the notion we are seeing the law implode at the expense of middle-class families."

HHS essentially confirmed state-by-state reports that have been coming in for months. Window shopping for plans and premiums is already available through HealthCare.gov.

Administration officials are stressing that subsidies provided under the law, which are designed to rise alongside premiums, will insulate most customers from sticker shock. They add that consumers who are willing to switch to cheaper plans will still be able to find bargains.

"Headline rates are generally rising faster than in previous years," acknowledged HHS spokesman Kevin Griffis. But he added that for most consumers, "headline rates are not what they pay."

The vast majority of the more than 10 million customers who purchase through HealthCare.gov and its state-run counterparts do receive generous financial assistance. "Enrollment is concentrated among very low-income individuals who receive significant government subsidies to reduce premiums and cost-sharing," said Caroline Pearson of the consulting firm Avalere Health

But an estimated 5 million to 7 million people are either not eligible for the income-based assistance, or they buy individual policies outside of the health law's markets, where the subsidies are not available. The administration is urging the latter group to check out HealthCare.gov. The spike in premiums generally does not affect the employer-provided plans that cover most workers and their families.

In some states, the premium increases are striking. In Arizona, unsubsidized premiums for a hypothetical 27-year-old buying a benchmark "second-lowest cost silver plan" will jump by 116 percent, from $196 to $422, according to the administration report.

But HHS said if that hypothetical consumer has a fairly modest income, making $25,000 a year, the subsidies would cover $280 of the new premium, and the consumer would pay $142. Caveat: if the consumer is making $30,000 or $40,000 his or her subsidy would be significantly lower.

Dwindling choice is another issue.

The total number of HealthCare.gov insurers will drop from 232 this year to 167 in 2017, a loss of 28 percent. (Insurers are counted multiple times if they offer coverage in more than one state. So Aetna, for example, would count once in each state that it participated in.)

Switching insurers may not be simple for patients with chronic conditions.

While many carriers are offering a choice of plan designs, most use a single prescription formulary and physician network across all their products, explained Pearson. "So, enrollees may need to change doctors or drugs when they switch insurers," she said.

Overall, it's shaping up to be the most difficult sign-up season since HealthCare.gov launched in 2013 and the computer system froze up.

Enrollment has been lower than initially projected, and insurers say patients turned out to be sicker than expected. Moreover, a complex internal system to help stabilize premiums has not worked as hoped for.

Nonetheless, Obama says the underlying structure of the law is sound, and current problems are only "growing pains." The president has called for a government-sponsored "public option" insurance plan to compete with private companies.

Republicans, including Trump, are united in calling for complete repeal, but they have not spelled out how they would address the problems of the uninsured.

Clinton has proposed an array of fixes, including sweetening the law's subsidies and allowing more people to qualify for financial assistance.

The law makes carrying health insurance a legal obligation for most people, and prohibits insurers for turning away the sick. It offers subsidized private plans to people who don't have coverage through their jobs, along with a state option to expand Medicaid for low-income people.

Largely as a result, the nation's uninsured rate has dropped below 9 percent, a historically low level. More than 21 million people have gained coverage since the Affordable Care Act passed in 2010.

[david wild]

Just now fact checked your 21 million number, 16.4 million on Obamacare,  which is still far less than the 30 million people who according to Obama did not have insurance, what happened to the other 14.6 million people, the whole thing was just another government scam to hurt hard working people.

[kscarbel2]

6 minutes ago, david wild said:

Just now fact checked your 21 million number, 16.4 million on Obamacare,  which is still far less than the 30 million people who according to Obama did not have insurance, what happened to the other 14.6 million people, the whole thing was just another government scam to hurt hard working people.

Not my number, David. Like you, I don't trust the news to be complete and fully accurate. But short of personally being there, it's all we have.

http://hosted.ap.org/dynamic/stories/U/US_HEALTH_OVERHAUL_PREMIUMS?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2016-10-24-19-50-10

[41chevy]

Now the number of people whom are classed as "insured" less than 5 million have actually paid premiums while the others have signed on and some what disappeared into the zone of A.C.A. "numbers".

[1958 F.W.D.]

I work for a small company- about 35 employees.

Got a 5% raise 2 weeks ago,

Now I know why. Anyone wanna take a bet that I get a letter from my employer come December sometime that he's going to have to start deducting more for my health care plan? 

[Keith Pommerening]

13 hours ago, 1958 F.W.D. said:

I work for a small company- about 35 employees.

Got a 5% raise 2 weeks ago,

Now I know why. Anyone wanna take a bet that I get a letter from my employer come December sometime that he's going to have to start deducting more for my health care plan? 

That is what happened to me last year.  Got a $1.00 per hour raise, my portion of health insurance cost went up $40.00 per week.  My portion now amounts to $6.07 per hour, or $240.28 per week.  And I thought insurance was out of control before Obummercare!  Feel bad for those who say they cant pay $350 per month.  Yea right. Keith

[1958 F.W.D.]

10 hours ago, Keith Pommerening said:

That is what happened to me last year.  Got a $1.00 per hour raise, my portion of health insurance cost went up $40.00 per week.  My portion now amounts to $6.07 per hour, or $240.28 per week.  And I thought insurance was out of control before Obummercare!  Feel bad for those who say they cant pay $350 per month.  Yea right. Keith

Just talked to my boss. My contribution will only go up $4.20 per paycheck, (8% of his 15% increase.) 

[kscarbel2]

The health care and pharmaceutical industries in the United States has been a blatant scam for decades. With multiple levels and angles, it may rank as the largest scam in existence.

In order to purchase medicine, why are you required to waste time and money seeing a doctor at a costs of some $100 in order to obtain a "prescription" for medicine that is sold over the counter in other countries? 

Why are you paying $50 for medicine sold in other countries for $5 ?

 

[kscarbel2]

Obamacare Is Dying. House Republicans Have the Fix.

Juliana Darrow, The National Interest  /  October 26, 2016

President Obama and his administration use every opportunity to boast about his flagship domestic legislation, the Affordable Care Act (ACA), also known as “Obamacare.” These near-weekly public relations efforts aim to convince the American public that the program has been a success. The administration frequently references the increased number of people with insurance in these efforts, despite the fact that enrollment numbers are not even half of the original projections, and still emanate primarily from the law’s Medicaid expansion. The number of people enrolled into a government program is not the right basis for judging success. Health care systems are intended to treat and heal people, so what fundamentally matters, and what the administration has said little about, is how the people who need health care are being treated. Access to care, medical outcomes, and cost are the metrics that matter, and on these fronts, although Obamacare is just a few years old, the administration has little to brag about.

The administration’s focus on insurance coverage is understandable, because this is essentially the only Obamacare metric that is improving. Yet, as coverage numbers rise, all major insurance companies have been forced to scale down participation in the individual market. As the relatively healthier young adult population fails to sign up for coverage at the rate the administration needs to help balance out costs, United Health Care, Humana, Aetna, and BlueCross BlueShield have had to pull out of many insurance markets due to heavy financial losses. Numbers released for the start of Open Enrollment next week, show an average of three insurers per county in 2017, down from five in 2016. HHS officials confirmed that one in five people living in states using HealthCare.gov will only have a single carrier to choose from next year. This is not what the president promised America.

The much touted ACA Co-Ops are also collapsing. Co-Ops were established as an alternative to traditional insurance companies—a consolation prize for those who wanted a public option. Now, 17 of the 23 established Co-Ops have gone out of business, wreaking havoc on state insurance markets in the process. The startup of these programs was funded with taxpayer sponsored loans that have not yet been paid back.

Premiums on the health exchanges are increasing by double digits across the country. Just this week, the administration admitted that premiums for benchmark plans that determine subsidy levels will increase by an average of 25 percent in 2017. However, many states will see much higher premiums, the second cheapest silver-level plan for a 27-year-old, will increase 116 percent in Arizona and 69 percent in Oklahoma. Seven other states will have premium increases of over forty percent.

Many on the left make light of the premium increase, because 82 percent of Americans with exchange coverage are on subsidized plans, according to the Kaiser Family Foundation. However, the amount of money paid out of pocket does not equal actual cost, because when costs go up, subsidies – and the taxes needed to pay them – go up as well. The government is simply redistributing money and further distorting the insurance market.

Employer sponsored insurance premiums are also increasing. Premiums for family coverage have increased 20 percent since 2011 and 58 percent since 2006 in the employer market. These plans are not subsidized by the government and the costs will be felt immediately by working families. As open enrollment begins on November 1, the administration will continue to push coverage numbers to help distract from the increased costs and lack of insurance choice for many customers.

There should be no celebration until we see improved access to care, better health outcomes and decreasing costs. This won’t happen with the increasing prices and the declining competition resulting from the bigger role government is playing in our health care market under the ACA. We have seen what Obamacare has done for America: as the government’s role in health care has expanded, the market has become distorted, costs have risen, competition has declined, and consumer options have become severely limited. It is time now to let the free market work. Enrolling people into an inefficient system that increases the costs of health care, and raising either taxes or the national debt to cover those costs is immoral and unsustainable. A free market-focused system that encourages competition is the only way to generate more choice and lower prices.

Americans are unhappy with Obamacare, and are increasingly likely to be open to market based reforms. More Americans view the law unfavorably than favorably and health care costs are a top concern for American families. Congress has the opportunity to lead on this issue and demonstrate a better way forward. So far they have focused on repealing the ACA, but no one wants to go back to the pre-ACA status quo. Congress should use this opportunity to communicate that better health outcomes and lower cost—not merely coverage—is what matters.

House Republicans have put forward a plan titled A Better Way. The plan’s objective is simply stated: everyone has access to quality, affordable health care. This plan sets up concrete ways to improve our health care system. Its goal is not to just enroll people into a government program but to also improve care. The plan advocates for choice, portability, innovation, and transparency instead of Obamacare’s overbearing regulations. Unnecessary coverage mandates are replaced with the opportunity for flexible plan design. This will increase competition and decrease price. Insurers will compete by creating plans that offer individuals specific benefits, allowing people to choose the type of coverage they want. Customers will not be forced to buy coverage they don’t need, like many must do currently with the standardized government mandated plan. With more options at competitive prices fewer people will likely elect to go without care. Democrats and Republicans should be able to agree that increased affordability is a worthwhile goal.

The Better Way proposal will also improve access to care. One of the main provisions of the ACA is to expand Medicaid coverage to people below 138% of the Federal Poverty Line. This actually decreases access for many Americans, because Medicaid plans pay doctors and hospitals less than private insurers, who then decline Medicaid patients, limiting access for those enrolled. In addition to an increase in their taxes, this also raises prices for people on private insurance plans, because doctors who do take Medicaid have to charge more to cover their costs. The Better Way Proposal advocates fixing the broken Medicaid system through state driven innovations. Allowing individual states to design plans that best fit their unique populations would mean eligibility and benefits standards that improve care and lower costs. Increased affordability would also mean Medicaid funds could be devoted only to those who truly need them.

Most importantly, the plan improves quality by returning the health care model to decisions between patients and providers, not a federal administrator. Individuals should be trusted to make their own decisions about their health care. Health outcomes will improve when patients have a choice in what doctors they see and what type of insurance they buy. The Better Way plan will also improve outcomes through health care innovation. It advocates for decreased bureaucracy that will spur innovation of new medications and treatments. The proposal builds off of popular reforms already in place: Health Savings Accounts, Medicare Advantage, the Medicare Prescription Drug Benefit and value based payments are popular across the political spectrum. Using this evidence-based practice to improve care, rather than continually tweaking the market with government rules, regulations and executive actions will provide better healthcare to millions of Americans.

The Better Way Proposal is a broad framework for improving health care, and the many pieces of legislation at its foundation provide a step-by-step guide to making them reality.  Straightforward legislation that can be implemented individually is a much better alternative to a large, overly complex mandate like the ACA. The Better Way Proposal includes individual bills that will increase access, lower costs and improve outcomes. If Congress can rally around this new patient centered plan, we may be able to get past only focusing on insurance rates, and instead get to a market based system that provides the greatest quality health care at the lowest possible cost.

Juliana Darrow serves as a health policy fellow at the American Action Forum, a think tank based in Washington, DC.

[GA_Dave]

The scariest words in the English language: "I'm from the government and I'm here to help!"

I received notice from my healthcare insurance provider the other day.  My premiums are increasing $240.00/month and they are covering less!  I am THRILLED!  Now, one-quarter of my income goes to health insurance premiums and I still have to pay several thousand in deductibles before they pay 60% (down from 80% for 2016).  TRUMP 2016!!!

[41chevy]

15 hours ago, kscarbel2 said:

Why are you paying $50 for medicine sold in other countries for $5 ?

 

To provide the Drug Companies and others with the money to retain lawyers on staff to fight frivolousness law suits, such as the on Bayer Aspirin had a number of years ago because the warning was not in the person dialect and they took to many. . . . sadly they won.

[kscarbel2]

Obamacare made it illegal to deny care to the sick. Insurance companies still do it

Ron Cohen, The Guardian  /  October 27, 2016

People with pre-existing conditions are still discriminated against. The government shouldn’t allow this to happen

For years, insurers dropped sick people from their plans or denied coverage due to preexisting conditions like cancer, keeping them from the care and medicines they needed. The Affordable Care Act (ACA) was supposed to make it unlawful for insurers to refuse coverage to such individuals or charge them more for health insurance. But it is still happening.

No longer able to keep patients off their plans outright, insurers have resorted to other ways to discriminate and avoid paying for necessary treatments. Specifically, they have imposed specialty tiers and high copays or coinsurance for prescription drugs that effectively force sick people to delay needed care or to find a different health plan. So much for the end of preexisting conditions.

Covering fewer sick patients translates to bigger profits for Big Insurance, but less healthcare for those who need it most.

A recent study from Harvard examined insurers’ use of these tactics. They found 12 plans on the ACA exchanges that discriminated against people with HIV by making them pay $3,000 more a year than those in other plans. This work highlights that such action “has the discriminatory effect of discouraging individuals in need of specific medications from enrolling in these plans or of shifting the burden of the cost back to these enrollees”.

Harvard’s Center for Health Law and Policy Innovation recently filed a landmark discrimination complaint with the Federal Office for Civil Rights against seven major insurers. The complaint noted that “Unaffordable cost sharing is just as much a barrier to care as outright refusal to cover medications … Left unchecked, these practices will drive individuals out of the health insurance market, leaving them once again without meaningful access to care.”

States from New York to Florida have attempted to take action against insurance companies found to be engaging in the practices. The federal government should also take a stand – both under the law and in the spirit of the ACA – to stop these unfair and discriminatory practices.

In June, the Centers for Medicare and Medicaid Services (CMS) announced $22m in funding to state insurance departments earmarked toward “implementing … consumer protections including: essential health benefits, preventive services, parity in mental health and substance use disorder benefits, appeals processes, and bringing down the cost of health care coverage (also known as medical loss ratio provision)”.

By any standard, “essential health benefits” must include access to needed medications. Yet the CMS language does not explicitly make this point. That should be corrected, as the federal government must make clear that discrimination against patient access to medicines will not be tolerated.

As a biotechnology CEO and chair of Bio, the world’s largest association of biotech companies, I spend most of my time working to develop innovative medications and to ensure that patients have access to them.

For years, the insurance industry and its allies have deflected attention from their responsibilities by pointing fingers at innovative biopharmaceutical companies, claiming that prescription drugs are the major driver of insurance premium increases. As study after study has shown, that’s simply false. For example, a recent independent study from Avalere showed that just 14% of 2017 premiums will be driven by pharmaceutical prices versus about 73% for inpatient, outpatient and professional services. And keep in mind that innovative prescription drugs actually save the healthcare system money over time through reduced surgeries and hospital stays and curbing of doctor visits.

The federal government needs to step up and take action against insurance companies that – while technically barred from dropping people with preexisting conditions – are nevertheless discriminating against them to achieve the same ends.

[kscarbel2]

Where Obamacare Is Really Headed: A 'Robust' Public Option

The National Interest  /  November 2, 2016

Democrats’ new strategy to control Obamacare costs will just make things worse.

An average 25 percent jump in health-insurance premiums sold on Obamacare exchanges has administration officials and their congressional allies scrambling to find some rapid remedy to control costs.

Emerging as the liberals’ leading policy prescription is a “robust public option”—an option roundly rejected during the 2010 debate. President Obama, presidential candidate Hillary Clinton, Health and Human Services Secretary Sylvia Burwell, Senate minority leader Harry Reid and thirty-two Democratic senators—the top political stars in America’s “progressive” constellation—all strongly endorse this proposal. They say it will enhance market competition and control costs. But . . . it’s got to be robust.

When progressives say they want to make the public option “robust,” what they really mean is they want to endow it with special advantages. To be blunt, they want to make sure that the “level playing field” between the public option and private plans is, well, tilted against private plans.

One way to do this, as congressional liberals proposed in 2009, is to base public-option payment rates for doctors, hospitals and other medical professionals at Medicare levels—well below the reimbursement rates that private health plans maintain in the provider contracts. Paying physicians less would enable the public option to offer lower premiums, undercutting the market share of private health plans.

The administration and its allies promise that this advantage will enhance competition. In fact, it would reduce competition. More and more private health plans would continue to exit the market, joining the major exodus that started during the first three years of Obamacare’s implementation.

A recent Heritage Foundation analysis of the exchanges found that, next year, one-third of all U.S. counties will have only one insurer (“mini single-payer plans”); another third will have just two insurers. Essentially, Obamacare has consolidated the exchange market to the point that only a few “big players” are left to administer the plans.

But advocates of more complete government control over the health care sector of the economy, think they have a surefire way to secure that control: raw coercion. Here, they have a couple of options. For example, government officials could change the Medicare law and make physicians’ participation in the new public option a legal condition of their right to practice in the giant Medicare program. In certain states, like Florida, giving up Medicare practice is financially prohibitive for physicians.

On the supply side, coercing physicians and medical professionals to follow government reimbursement rules is standard political practice. One need look no further than the 2,400-page regulation issued to enforce the Medicare “payment reform” enacted in Medicare Access and CHIP Reauthorization Act of 2015 (MACRA).

Alternatively, in the big blue states ruled by liberal governors and state legislators, policymakers could tie state medical licensure to their physicians’ participation in Washington’s new “robust public option.”

On the demand side, Obamacare’s penalty for individuals who refuse to buy a government-approved health plan can be “upgraded” and more rigorously enforced.

This year, the annual penalty for individuals going without coverage is $695 or 2.5 percent of family income, whichever is greater. For 2017, the penalty is indexed to inflation. Even so, just in terms of dollars and cents, paying the penalty is a lot cheaper than shelling out a bigger chunk of personal income to buy an expensive health plan with big deductibles. For 2017, deductibles in the lowest-cost “bronze” plans average over $6,000 for a single person and $12,393 for family coverage. Moreover, under current law established long before Obamacare, access to hospital emergency medical care is legally available regardless of one’s financial capacity to pay for it.

Not surprisingly, the biggest exchange enrollment challenge is capture younger, healthier customers—those annoying millennials who don’t think buying an Obamacare plan is worth their time, effort or money. Frustrated liberals may regard them as spoiled brats. But their truancy—not ponying up their “fair share” to subsidize older and sicker enrollees—is another reflection of Obamacare’s design flaws: the restrictive age-rating rules overprice coverage for the young, and the standardized-coverage insurance package just doesn’t offer them value for the money. This flight of the young and the healthy from the Obamacare exchanges is a contributing factor to sharply rising exchange premiums—a major embarrassment to the president who promised, repeatedly, to cut health insurance costs. Obamacare’s champions, in academia and elsewhere, have another simple statutory answer: just toughen up the individual mandate’s “tax penalty”; hit the scofflaws harder. That is indeed the latest prescription endorsed by none other than Professor Jonathan Gruber of MIT, the so-called “architect” of Obamacare.

A public option with artificially low payment rates, reinforced by increased government coercion and tougher mandates on doctors—that’s a stiff policy cocktail. Imagine the hangover. Private health plans would be unable to compete with the artificially low payment rates of the public option; more and more enrollees would migrate to the public option, leading more and more private plans to withdraw due to declining market share. Voila! A government monopoly.

But how to secure financial stability for the robust public option on the way to market domination and control? Another painful prescription: force taxpayers to assume financial risk for the public plan. That’s precisely what House Democrats proposed in their initial version of the Affordable Care Act unveiled in June of 2009.

Imagine. A “robust public option,” enrolling millions of Americans as commercial carriers dropped out of the market, would become, just like the great Wall Street banks, simply “too big to fail.” It is likely that, at least initially, the artificially underpriced public option premiums will encourage the migration of poorer and sicker enrollees, and would thus require more and more subsidies to remain viable. Today, a money pit; tomorrow, a well-entrenched debt generator.

For politicians, forcing taxpayers to assume the financial risk for their policy mistakes carries a political benefit: more and more Americans would become directly dependent on government for their health-care dollars and decisions. It’s about power. And that, at the end of the day, is doubtless the true objective of this latest proposal.

[kscarbel2]

On 10/27/2016 at 7:22 AM, kscarbel2 said:

The health care and pharmaceutical industries in the United States has been a blatant scam for decades. With multiple levels and angles, it may rank as the largest scam in existence.

In order to purchase medicine, why are you required to waste time and money seeing a doctor at a costs of some $100 in order to obtain a "prescription" for medicine that is sold over the counter in other countries? 

Why are you paying $50 for medicine sold in other countries for $5 ?

 

If you believe that the government is in bed with the health care and pharmaceutical industries, than you know that nuggets like this are probably thrown out every couple of years for appearance’s sake.

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Generic-Drug Firms Face Possible Collusion Charges

The Wall Street Journal  /  November 3, 2016

U.S. Justice Department has sent subpoenas to several drugmakers and to some individual executives

Federal prosecutors, after a lengthy probe, are nearing possible criminal charges for price-collusion in the generic-drug industry.

The U.S. Justice Department could begin to bring cases before year’s end, though the timing of any potential enforcement actions remains uncertain.

The specific companies that are a focus of the investigation weren’t immediately known. However, the Justice Department has sent subpoenas to several manufacturers of generic drugs and to some individual executives, seeking information about product pricing and “communications with competitors,” according to the companies’ filings with the Securities and Exchange Commission over the past two years.

Those companies include Teva Pharmaceutical Industries Ltd.; Mylan NV; Dr. Reddy’s Laboratories; Taro Pharmaceuticals; Endo International PLC; and Actavis, which Allergan PLC recently sold to Teva.

The developments sent shares of generic drug makers tumbling. Endo fell 20%, while Teva declined 9.5%, and Mylan dropped 6.9%.

In a separate probe, a group of state attorneys general are investigating generic-drug companies for price-fixing. That investigation, which is a civil matter, is being led by Connecticut Attorney General George Jepsen.

That probe began in 2014 and includes smaller drug companies as well as some of the largest U.S. drug manufacturers and the U.S.-based subsidiaries of foreign companies.

The pricing practices of pharmaceutical companies that make costly branded drugs have attracted significant public outcry over the past year, spurring congressional hearings and regulatory probes. But the pricing of generic drugs, which generally cost much less than brand-name drugs, has drawn much less scrutiny.

However, prices for some generic drugs have risen sharply in recent years. The Government Accountability Office in August issued a report finding that more than 300 of 1,441 established generic drugs analyzed had at least one extraordinary price increase of 100% or more between 2010 and 2015.

Price collusion, if proven, could undermine a key goal in the rules that fostered the creation of generic drugs: to reduce spending.

The exact nature of the federal investigation isn’t fully clear, but some companies have identified specific drugs of interest to the government. Endo disclosed in an SEC filing that the Justice Department sought information from its Par unit about at least two generic drugs: digoxin, a heart drug; and doxycycline, an antibiotic. Mylan said the subpoena it received sought information about its generic doxycycline product.

Many generic drugs are produced by more than one manufacturer. The GAO report said both digoxin and doxycycline had significant price increases since 2012, though it didn’t specify the manufacturers.

Some labor-union health-benefit funds and other drug purchasers have filed lawsuits in state and federal courts against some of the drugmakers, including Mylan and Endo, alleging that they conspired to fix the prices of digoxin and doxycycline. The plaintiffs allege that between 2012 and 2014, the average market price for digoxin and doxycycline increased by 884% and 8,281%, respectively, according to a court document. Mylan said in an SEC filing it intends to defend itself against the suits.

Agreements among companies to set prices or to divide up markets have long been illegal under federal antitrust law. Prosecutors have generally found it difficult to win price collusion cases, because of the high barrier that courts have established to prove a conspiracy among different companies, according to Herbert Hovenkamp, a University of Iowa Law School professor and author of the “Antitrust Law” textbook.

“Courts are clear” that there must be evidence of an agreement among companies to follow each other on prices, such as a written document or telephone conversation or a meeting, Mr. Hovenkamp said.

Most criminal price-fixing cases end up settling, rather than going to trial. In recent years, dozens of auto-parts makers have agreed to plead guilty to fixing prices on new car parts, and have paid nearly $2.9 billion in criminal fines.

Wells Fargo analyst David Maris said in a research note that the news of the investigation “could add a severe overhang to the sector that may last well past the presidential election and into the new year.”

[kscarbel2]