Trump calls Medicare Part B proposal 'revolutionary,' but experts see limited benefits

Polls show voters are worries about healthcare costs

Polls show voters are worries about healthcare costs

Stephen Ubl, president of the industry trade group Pharmaceutical Research and Manufacturers of America, or PhRMA, said imposing foreign price controls from countries with socialized health care systems would harm patients and hinder drug discovery and development.

Pharmaceutical manufacturers charge 1.8 times more in the U.S. than in other countries for drugs that fall under Medicare Part B, which are also used to treat conditions such as multiple sclerosis and autoimmune disorders, according to a Health and Human Services Department report released earlier Thursday.

Trump's remarks were the first as president at HHS and come at a time when health care is playing a defining role in the campaign as Democrats slam Republicans over whether they support protecting access to health care for people with preexisting conditions.

All countries in Europe look to other countries on drug pricing to some degree.

Foreign countries, he said, even threaten to disrespect USA patents if they are not given cheaper prices on drugs.

The Trump administration is focused on prices paid for drugs that are covered under a portion of the Medicare program known as Part B. Those are typically drugs that are given in an doctor's office and include drugs used in cancer treatment, as well as eye medications like Eylea and Lucentis, used to treat age-related macular degeneration.

The timing - two weeks before an election where health care remains a prominent issue - may be political.

And drug companies are not going to "walk away" from the world's largest payer for prescription drugs, Azar argued.

HHS today released a study of 27 drugs that are usually paid for by Medicare Part B that showed that on average the USA pays 80 percent more than the average prices in other countries.

But the administration has in fact been supportive or actively engaged in efforts that could affect people with pre-existing conditions - from repeated attempts to roll back Obamacare to efforts at the agency level to loosen regulations that provide ironclad protections for consumers who are or have been sick.

"Medicare was found to be paying the highest price for 19 out of the 27 drugs studied compared to these other countries", Azar tweeted.

The proposal was met with hope and skepticism, with several experts saying they were happy the administration was taking on Medicare Part B's rising drug prices but questioning its approach. Nothing special, just the prices that other countries pay.

"The United States will finally begin to confront one of the most unfair practices. that drives up the cost of medicine in the United States", Trump said.

But instead of an add-on payment tied to the cost of the drug, providers will receive a fixed payment instead, therefore eliminating the incentive to prescribe a more costly drug. The new prices would be pegged to an "international pricing index" based on the average sales price in other countries with economies comparable to that of the United States.

Trump, in his speech introducing the plan Thursday, called out several drugs specifically for the savings that could be generated from bringing prices more in line with the mooted worldwide index. "We're fixing it. That's called real-life experience, I guess", Trump added. In contrast, Part D spending on drugs has risen much more slowly.

The report "provides troubling insight into how the current global drug pricing system has put America in last place, " Azar tweeted.

HHS intends for the IPI payment model to reduce Medicare spending on Part B, which increased from $17.6 billion in 2011 to approximately $26 billion by 2016. But his populist proposal didn't appear likely to budge the national debate around health care, just days ahead of the midterm elections. In a March Kaiser Family Foundation poll, eight in 10 respondents said drug costs are unreasonable and 92 percent said passing legislation to bring down the cost of prescription drugs should be a top or important priority.

Why it matters: This is the Trump administration's most aggressive move yet to lower drug prices.

While Medicare is barred from explicitly negotiating prices with drug companies, Trump's proposed changes are all created to use the collective power of the growing Medicare market to force drugmakers to bring down their prices or lose access to a potentially lucrative market. The IPI model instead would engage private sector vendors to offer certain drugs to participating physicians and hospitals at a rate based on a Target Price derived from an global price index. Trump can complain about high drug prices all he wants.