Trump proposes “revolutionary” Medicare model

Oct. 25, 2018

In today’s speech at the Department of Health and Human Services, President Trump proposed an "international pricing index" that would be used as a reference point for helping set prices for drugs paid for through Medicare Part B — a change the President calls “revolutionary.”

According to Trump, his administration is taking action to stop “global freeloading” by foreign nations when it comes to the prices American patients pay  for prescription drugs, allowing Medicare to directly negotiate prices with drug companies who Trump says have “rigged” the system, causing U.S. patients to pay more for meds.

In advance of the speech, HHS released a report that found U.S. prices for the top drugs administered in doctor's offices are nearly twice as high as in foreign countries. Medicare’s Part B program covers all doctor’s visits for seniors and the drugs prescribed to them during their visits.

Pharma industry groups expressed their disapproval with Trump’s proposed plans. According to a statement from Pharmaceutical Research and Manufacturers of America's (PhRMA) president and CEO Stephen J. Ubl:

“The administration is imposing foreign price controls from countries with socialized health care systems that deny their citizens access and discourage innovation. These proposals are to the detriment of American patients. The United States has a competitive marketplace that controls costs and provides patients with access to innovative medicines far earlier than in countries with price controls, and it’s why we lead the world in drug discovery and development.”

“We oppose changes to Medicare that threaten patient access to innovative, lifesaving medicines and are disappointed the administration put the needs of patients aside with these proposals.”

Trump's drug proposal plan would go into effect in late 2019 or early 2020, at the earliest.

Read the NY Times coverage