Articles

Trump's Drug-Pricing Ideas Would Cost Taxpayers a Bundle

Meanwhile, pharmaceutical companies would stand to make a lot more money.
Originally published on 09/29/2020 in Bloomberg Opinion

Early in President Trump's term, he said pharmaceutical companies' prices were so high they were 'getting away with murder.'

However, drug prices rose anyway. The Associated Press reported that in 2018, for every one drug price that fell, 96 other drug prices went up. President Trump's administration proposed a wave of new federal policies in a last-ditch effort to deliver on his campaign promises. Dr. Bach lays out the proposals and describes how the strategies in these proposals would only enrich the pharmaceutical industry, and raise costs for taxpayers. 

  1. In June, the Trump administration proposed a loophole that would let drug companies give bigger discounts to their preferred customers than Medicaid. By revoking price protections, it would raise costs for the vital program.  
  1. When it came time to negotiate the price of Remdesivir in June, HHS committed US hospitals to pay about $3200 per treatment – 33% more than the price the company announced it would charge other developed countries. 
  1. The president signed an executive order meant to block insurance companies from collecting rebates from drug companies after beneficiaries fill their prescriptions. In effect, insurance premiums for everyone would increase, regardless of whether they buy Part D insurance or get insurance through their employer or an insurance-exchange plan. 
  1. Trump announced he will let people import lower-priced drugs from Canada, however he has not outlined a formal plan. 
  1. The president announced that Medicare would pay no more for drugs than other high income countries do. In reality, drug companies can still charge doctors and hospitals high prices, but the government and taxpayers will have to compensate.  
  1. Trump promised to send Medicare beneficiaries $200 cards to help pay for their medicines. However, giving them money to help defray the cost would only encourage drug makers to raise their prices more.  

Read the full piece here.

Share

Research & Insights

We conduct non-partisan, independent research, and make our work accessible and informative to policymakers and the general audience alike. Browse our featured research or explore our work by article type.

Production Plus Profit Pricing (P-quad) FAQ
08/17/2021
What A Waste! The National Academy Of Medicine’s Report On…
Why Congress should not follow the National Academy of Science, Engineering, and Medicine’s recommendation to remove the JW modifier.
Health Affairs Blog 07/09/2021
Medicare Must Study Unproven, Expensive Alzheimer’s Drug
Medicare cannot indiscriminately cover the cost of Aduhelm for the treatment of Alzheimer's disease without first evaluating whether it truly works.
Bloomberg Opinion 06/15/2021
Value-Based Management of Specialty Drugs: Practical Considerations and Implications for…
Not all approaches are suited to meeting policy makers and health plans’ goals of managing specialty drugs based on their value. Researchers conducted a qualitative study with Blue Cross Blue Shield plans interested in implementing value-based specialty pharmacy management to observe the plans’ objectives, strategies, and factors influencing their ability to execute on these strategies.
AJMC 05/13/2021
The Drugs at the Heart of Our Pricing Crisis
The US drug pricing system is broken, but not irreparable. For large-molecule biologic drugs, enter: Production Plus Profit Pricing (P-quad, pronounced like Ahab's seagoing vessel).
NYTimes 03/15/2021
Biosimilars: Market Changes do not equal policy success
Numerous articles and reports have trumpeted biosimilar market growth, but it's critical we do not lose sight of the sole objective for creating the biosimilar market: to reduce the cost of older biologic drugs for society and taxpayers.
Drug Pricing Lab 03/15/2021
Instead of debating 'first-shot' vs 'set-aside' vaccine approaches, hospitals' study…
Hospitals could start studies of their own employees to answer important questions, including whether the first-shot approach has downsides when compared to the set-aside strategy.
STAT 01/04/2021
After 4 Years of Trump, Medicare and Medicaid Badly Need…
Many promising ideas won't work as expected, and that's all the more reason for CMS to evaluate how medical care is delivered to its patients.
NYTimes 12/01/2020
Trump's Drug-Pricing Ideas Would Cost Taxpayers a Bundle
Meanwhile, pharmaceutical companies would stand to make a lot more money.
Bloomberg Opinion 09/29/2020
We can't tackle the pandemic without figuring out which Covid-19…
There may be several Covid-19 vaccines by winter, but there will also need to be a study comparing the viruses to one another as part of rolling out widespread vaccination.
STAT 09/24/2020
CMS's Proposed Medicaid Best Price Loophole for Value-Based Purchasing of…
The administration has proposed a loophole in the Medicaid Best Price rules that would dismiss linking the drug's effectiveness to its price.
HA Blog 07/06/2020
The Science on Coronavirus is Topsy-Turvy. That's Fine.
Urgency demands patience, because advancement is always a product of missteps.
NYTimes 04/30/2020
Newsletter

Stay up to date on our work and news