Monday, June 17, 2013

Immunization Taxes / Risk and Tort Mgmt

To keep things seperate, here is another from Mac.

"BTW, another bill scheduled to be voted on is H.R. 475, do you support or oppose it ?

H.R. 475, which would add a new excise tax on flu vaccines … a meager 75 cents a shot but with the potential of 135 million doses of flu shots distributed in a year, the revenue generated would be $100 million. The monies go into the National Vaccine Injury Compensation Trust Fund … which was created by the National Childhood Vaccine Injury Act of 1986. The law was passed at the specific request of pharmaceutical companies who threatened to stop making vaccines without product liability protection, as well as organizations representing pediatricians who were reluctant to give childhood vaccines without liability protection.

It is a matter of public record that the Departments of Health and Human Services and Justice were strongly opposed to the legislation. Currently, a $.75 excise tax is imposed on each dose of specific vaccines based on the number of diseases that is prevented by the vaccine. Trivalent influenza vaccine for example, is taxed $0.75 because it prevents one disease; measles-mumps-rubella vaccine, which prevents three diseases, is taxed $2.25.

Now, Representative Jim Gerlach wants a Flu Tax to go to the VITF. While it may be well-intended, the fund currently is over-funded … as its current balance is higher than what it has paid out in over 25 years. Congress has known about this situation for years but has ignored it … Because the trust fund has spent less than what it has collected, the remaining $1 billion was loaned to the Treasury and used for other federal programs and activities. In exchange, the trust fund received Treasury securities to be redeemed if needed to pay future claims.

Why the claims are so low is the nature of the system … To file a claim, the vaccine must have caused an injury that lasted for more than six months after vaccination, OR resulted in a hospital stay and surgery (both), OR resulted in death. Not all vaccines are covered, although most vaccines recommended for children are covered, including MMR, polio, tetanus, pertussis and others. It may take two to three years to work through the claim process. And the success rate is low … the most recent report (April 1, 2013) indicates that 3,217 claims were compensated while 9,454 were dismissed.

Now, Congressman Gerlach wants to add the flu vaccine to the vaccines that an excise tax is collected … no outrage about the cost to consumers nor the concern to make health care more affordable."  Mac Hall (aka Minnesota Central)

Thoughts?

14 comments:

John said...

I guess my question is can the "Government" trust fund be sued by a class action lawsuit like a normal drug company can?

If not, that likely explains the low pay out rate. There may not be enough low hanging fruit to make the lawyers start salivating... Maybe it is a tax well spent?

Imagine if the Autism / Innoculations crowd attained a class action settlement. I am assuming the billion dollars would be used up pretty quick.

How about we drop the tax and limit the tort liability significantly??? G2A Healthcare Cost Control 5

John said...

Wiki Drug Settlements

So do you really expect companies to make low margin generics with this kind of potential liability staring them in the face... Would you volunteer to produce them?

John said...

Another zinger... PRWEB Yaz Case

And we wonder why drugs are so expensive here...

Minnesota Central said...

Don't miss the point how high the hurdles are to file a claim ... and the current funding levels.

The question that must be answered is :
Why 75 cents ?
Why not a dollar ?
Why not a penny ?
Why not nothing ?

It is obvious to me that Congress is creating a funding program ... by charging a small amount that will produce big revenues for the Treasury that then provide an offset for other spending/tax cuts.

John said...

Sounds like a good fund raiser then, just like taxes on tobacco, alcohol, medical devices, etc. What's your point?

Anonymous said...

I always wondered why these things aren't covered by insurance. Causation, I would think, must be terribly difficult to prove, and whatever the cause, we still have a child in need of care that must be paid for.

--Hiram

John said...

Which insurance?

Typically even if insurance pays out, they will seek to recover whatever they can from who ever they can. Usually from those with the deepest pockets...

And Lord knows the class action lawyers are often advertising to attract suit participants. Imagine the temptation of a billion dollar settlement where they get to keep half... They are highly motivated to get the case in front of a sympathetic journey.

John said...

Mac,
Are the hurdles higher than normal tort law? If so, why in your opinion?

John said...

I think this belongs here... G2A

Just because someone has a bad outcome from a vaccination, that doesn't mean that any negligence has occurred. Sometimes, most of the time even, stuff just happens. Risk is part of any medical treatment, and I don't think negligence is a routine part of any drug company's model. I suspect people sue drug companies when they have damages they can't pay for, and need to find someone with deep pockets. The theories of negligence come later. If people have adequate insurance, there just isn't a reason to go through the very difficult process of suing drug companies who probably haven't done anything wrong. If they have, in fact, done something wrong, a whole different set of contingencies and consequences comes into play.

--Hiram

John said...

Actually, they don't necessarily have to do anything wrong. A lawyer just needs to convince jurors that people were harmed and it was unfair. And that this wealthy company can afford to help compensate them for their misfortune...

That is the problem with using lay people as jurors instead of technical experts...

Anonymous said...

A lawyer just needs to convince jurors that people were harmed and it was unfair.

But why would a lawyer want to do it if his client has been compensated for his damages? The problem a typical malpractice lawyer has isn't pursuing bad cases, it's identifying which good cases can be profitably pursued.

--Hiram

John said...

Because often people feel they deserve more than what insurance pays out or covers. They want really low premiums and really high payouts... Kind of like SS and Medicare...

Anonymous said...

Because often people feel they deserve more than what insurance pays out or covers.

Tort law isn't there to give people what they deserve, it's there to compensate people for damages they suffer from a wrong. But the problem comes when there is no insurance or insurance is inadequate. Then, it's very definitely in the interest of the victims and their attorneys to bring malpractice cases. This is why most of the famous malpractice cases you hear about come in jurisdictions where large portions of the population are either inadequately insured, or not insured at all.

--Hiram

John said...

Do you a source for your theory regarding where cases occur?