Biden’s Health Care Agenda Will Make a Broken System Worse | Opinion
But unfortunately, the proposals being floated by the Biden administration double down on policies that have already been proven to make a broken system worse. The Biden agenda is characterized by increased government intervention that will further handicap transparency, free-market competition, and patient choice within the U.S. health care system.
Republican 2024 candidates have a big opportunity to carry a counter reform blueprint that will actually improve the experience and health outcomes of patients.
Chief among Biden’s health care priorities is to expand drug price controls that were initially implemented as part of the misnamed Inflation Reduction Act (IRA). The statute compels drugmakers to provide certain products at a fraction of the market price through Medicare. It’s an experiment in government price manipulation that is already backfiring.
The plan is compromising health care innovation—slowing the pipeline of new lifesaving treatments, therapies, and vaccines coming to market.
The University of Chicago finds the resulting upside-down incentives and shrinking R&D budgets are specifically affecting the development of medicines commonly taken in pill form. The analysis estimates there will be nearly 200 fewer treatment advances in this area, known as small-molecule drugs, because of the IRA. Expanding government price controls will exacerbate this alarming trend.
Moreover, the White House is considering making temporary enhanced Obamacare subsidies permanent. The larger payouts—which originated during the pandemic era and are set to expire after 2025—are a clever trick to mask part of the health care cost crisis with taxpayer dollars. The strategy uses smoke and mirrors to hoodwink some Americans into believing health care costs are under control.
In reality, the money-moving scheme amounts to a temporary Band-Aid that does nothing to quell long-term inflationary pressures within health care. And extending the policy indefinitely will mean middle-class families who don’t qualify for subsidies will continue to be financially squeezed while others are blindfolded to the real problem.
Rather than pursuing this harmful cocktail of policies, the administration should root health care reform in transparency, free market competition, and patient choice.
To tackle high medicine costs, for example, policymakers should address the middlemen of the drug supply chain. These entities—called pharmacy benefit managers—take advantage of an opaque, anti-competitive market to profit at the expense of patients. Nationally, just three of them are responsible for managing 80 percent of drug prescriptions.
A recent economic analysis finds these middlemen use their dominant position to influence the way doctors prescribe medicine—often steering patients towards more expensive pharmaceuticals to increase profits. Additionally, pharmacy benefit managers absorb billions of dollars annually from the pharmaceutical market that are intended to be passed on to patients at the pharmacy counter as financial savings.
Policy platforms for next year should also include thinning the government regulations associated with Obamacare that restrict patient choice. Americans should be free to access a wide variety of health care coverage options—ranging from catastrophic care to platinum plans—that best fit their unique circumstances. After all, the needs of a healthy 20-something are very different from the needs of someone on the verge of retirement.
Expanding health savings accounts while also elevating the innovative direct primary care business model are other policies to pursue. The combo will provide patients further control over their health care dollars while presenting medical care options outside of the traditional insurance-based model.
As health care policy takes a more prominent position in the spotlight for the upcoming general election, candidates have an opportunity to win over voters. A smart, substantive health care agenda that prioritizes choice, competition, and transparency is the winning ticket.
Dr. Tom Price served as the 23rd U.S. Secretary of Health and Human Services and is a senior health care policy fellow at the Job Creators Network. Elaine Parker is the president of the Job Creators Network Foundation, which manages the HealthcareForYou.com