The assassination of UnitedHealthcare CEO Brian Thompson thrust health care into the national spotlight with remarks ranging from condemnation, to cheers, to jokes, to Sen. Elizabeth Warren’s seeming tacit resignation to violence.
Despite the heat of the rhetoric, President-elect Donald Trump is suddenly situated as the only man who can lower the temperature of the national conversation by expanding on a popular, bipartisan policy from his first term: Health Care Price Transparency.
In 2019 the Trump administration launched a sweeping policy making the price of medical procedures transparent for all consumers. And after roadblocks from hospitals and the Biden-Harris administration, it has become clear that incoming administration has the opportunity to reinvigorate medical transparency and expand it to prescription drug prices as well.
The 340B program was created to make expensive prescription drugs more affordable for low-income Americans. Through the program, pharmaceutical innovators and manufacturers would work with government to offer discounts on certain drugs prescribed to in-need populations.
Unfortunately, hospitals have figured out how to game the system and get a special discount on the drugs they sell to almost anyone, without passing along the savings to patients and their insurers.
Participation in the 340B program has soared by 4,228 percent as big hospitals consolidated their power and market share by buying up low-income providers. They then shifted savings and resources from poor, often minority communities into health systems in affluent suburbs, buying drugs at a bulk discount but selling them at full retail to privately insured and uninsured patients.
American taxpayers and drug manufactures have been left holding the bag as hospitals enrich themselves without passing along cost savings to consumers who truly need the savings to make ends meet.
As an alternative to continuing this charade, one of the participating companies, Johnson & Johnson, proposed to offer after-the-fact rebates instead of up-front discounts in the 340B program. This would ensure discounts are being used as intended by requiring hospitals to offer transparency in exchange for the rebates, curbing the hospitals’ perverse incentive to balloon their profits in the retail health care industry while stiffing health care innovators. It was a true win-win for taxpayers and consumers.
But the Biden-Harris Health Resources and Services Administration (HRSA) responded with massive government overreach, threatening Johnson & Johnson with shocking and unlawful penalties, such as removing their ability to participate in the program and initiating a witch-hunt style investigation into the company. For daring to suggest a policy approach that would make 340B work as Congress intended, Johnson & Johnson faced the total weaponization of federal regulators.
In his first term, President Trump signed legislation requiring hospitals to disclose the cost of various services to consumers. With voters rejecting the Biden-Harris legacy, a second Trump term could see the president-elect cement his legacy as the most pro-health care consumer president in history by bringing that same transparency to drug prices.
After ending the proposed questionable and draconian penalties of the Biden era, the Trump administration could adopt a far more reasonable and defensible approach. One that puts consumers first, rewards innovation, and curbs the abuse of power exercised by career bureaucrats committed to a broken status quo.
Through 340B, we know how much hospitals pay drug companies, and we know how much consumers pay hospitals for those same drugs, but we don’t know what rich hospital systems do with the profits. That’s an astounding lack of transparency for a federal program originally intended to serve the poor.
The federal government should require health systems to make these numbers publicly available. The public deserves to know how much of the 340B savings is being passed along to them, how much of it is being reinvested in improvements to patient care, and how much is going to pad the profits of health care provider systems. This last part is frightening to big hospitals and it will require courage to implement.
Additionally, uninsured and underinsured patients should be able to buy their prescriptions from 340B providers at the same discount the providers receive from pharmaceutical companies, or at least close to it. It’s not unreasonable to require a federal program designed to help patients provide real cost relief to patients.
Transparency, more accountability, and more efficiency are powerful antidotes to what ails our nation. And the Trump administration can deliver that medicine with a populist spoonful of sugar.
Ending opaque middle-man markups of drug prices, empowering stakeholders to propose solutions, and limiting the ability of bureaucrats to stifle those solutions and protect the failed status quo are all achievable policy goals that benefit health care consumers and help Make America—and the national conversation—Healthy Again.
Brian Sikma is the executive director of American Resolve Action, a national organization that champions opportunity, enterprise, and freedom in the marketplace of ideas and commerce.
