On Thursday, President Trump rolled out a plan to dramatically reduce the cost of Medicare drugs and out-of-pocket costs to patients, a move which could save taxpayers over $17 billion over the next five years.
Announcing the new rule at an event at the Department of Health and Human Services (HHS), Trump vowed to end a “rigged” system in which Medicare enrollees often pay much higher prices than in other developed countries.
“For decades other countries have rigged the system so that American patients are charged much more — and in some cases much, much more — for the exact same drug. In other words Americans pay more so other countries can play less,” Trump told an audience at a Centers for Medicare & Medicaid Services (CMS) event.
Under Mr. Trump’s proposal, Medicare would adopt a benchmark for specific drugs administered by physicians against an index of prices in advanced countries, like the U.K., France, Germany and Canada, which HHS called out in May for “freeloading.”
Similarly, Trump’s proposal calls for negotiations between pharmaceutical firms and vendors and payment modifications to cut costs.
The proposal of an “international pricing index,” Trump says, will drive down U.S. drug costs without having the federal government intervene and impose massive regulation over the health care industry.
Despite the proposal’s relative modesty, the pharmaceutical lobby was quick to denounce the plan.
“The administration is imposing foreign price controls from countries with socialized health care systems that deny their citizens access and discourage innovation,” said PhRMA CEO Steve Ubl in a statement.
A step taken just weeks before 2018 midterm elections, Trump’s plan comes in response to revelations Medicare fee-for-service spending increased 9.8 percent annually between 2011 and 2016.
Trump’s plan also aims to discourage physicians from prescribing more-costly drugs used to treat cancer, arthritis, multiple sclerosis patients covered by the Medicare Part B plan.
According to CMS, the administration would issue the proposed rule sometime in the spring 2019, and the benchmark model, the price index, would be introduced in 2020 and exist until 2025.
[Politico] [Business Insider] [Photo courtesy AP/Carolyn Kaster via Washington Times]