Trump Seeks Lower Prescription Drug Prices

There's Disagreement On How To Achieve That Goal

President Donald Trump
President Donald Trump speaks during his meeting with health insurance company executives in the Roosevelt Room of the White House in Washington, Monday, Feb. 27, 2017.

President Donald Trump has said prescription drugs should be affordable for all Americans. He recently met with Congressional Democrats who’ve long tried to pass legislation to allow Medicare to negotiate prices. Local insurance companies and pharmacy benefit managers have mixed views on the matter.

Mark Huth, CEO of Group Health Cooperative of South Central Wisconsin, said if the government were allowed to negotiate pharmaceuticals used in the Medicare program it could have both positive and negative effects.

“I like the idea of Medicare being able to negotiate but I also am worried if the same profit goals are there and Medicare is able to lower the price the only alternative for the pharmaceutical companies will be to pass that on to the commercial business,” he said.

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Huth said attempts to control costs need to go beyond Medicare.But far-reaching legislation could be problematic, Andy Pulvermacher, specialty services supervisor at UW Health, said at a Wisconsin Health News forum on March 7 in Madison.

“The (pharmaceutical) companies are so widely-held,” said Pulvermacher.”They are publicly traded. Any sort of limitation (on prices) would essentially bring significant changes related to the stock market and I’m not sure anyone wants to put us into another recession. So I don’t think you are going to see that. A lot of the (price) control is going to have come from the payer market.”

Before the presidential election there was a period when price increases stalled due to uncertainty and sensitivity to rhetoric, Pulvermacher said. As soon as the election happened, and the results were cast, he said there was an unprecedented number of price increases after Jan. 1.

“There 700 (drug) price increases and counting between the first of January and Jan. 15,” Pulvermacher said. “So that’s never happened before. When you look at that compared to January 2016, that’s more than three-fold higher than the year previous and more than four-fold higher than the year previous to that.So there needs to be something done related to how price inflation happens.”

Whether significant savings would occur if Medicare were able to negotiate drug prices is unclear. Under both Presidents Barack Obama and George W. Bush the nonpartisan Congressional Budget Office predicted repealing the ban would result in only minimal savings.