On Thursday, President Donald Trump introduced his plan to tackle skyrocketing healthcare costs, a mishmash of ideas he calls “The Great Healthcare Plan.” The raft of proposals ranges from mandating lower prescription drug prices to “holding big insurance companies accountable” for soaring healthcare premiums.
What’s missing, however, are specifics on how the ideas would be implemented. It also has no plan to extend the tax subsidies millions of people depend on to buy Affordable Care Act insurance policies — including millions of Black Americans who otherwise wouldn’t have healthcare coverage.
The House of Representatives last week voted to extend the ACA tax credits, and the bill is still waiting for the Senate’s approval, which looked unlikely as of Thursday. At the same time, key members of Congress, along with the pharmaceutical and health insurance industries, don’t seem to think The Great Healthcare Plan is all that great.
“Today’s announcement is more of the same bluster, with zero substance, that Republicans have been peddling since the inception of the ACA,” Rep. Richard E. Neal, a Massachusetts Democrat, said in a statement. Neal is the ranking Democrat on the House committee that has a key role in bills involving Social Security, Medicare, and social service programs.
Since Trump returned to power last year, “hospitals are shuttering, premiums are soaring, everything from insulin to medical supplies costs more, yet CEOs are getting sweetheart deals,” Neal said. Republicans, he said, have ignored Democratic plans that tackled costs, and instead, “they resort to flooding the zone with empty promises while the people are forced to pay more and get less.”
Planning to Make HSAs Mainstream
On its face, Trump’s plan does nothing to keep Medicaid accessible or make employer-based health insurance plans less expensive. Instead, the plan relies on a scheme to give Americans money for health savings accounts — a way for people with certain high-deductible health insurance plans to set aside money for doctor visits, medicine, and other health care costs.
The money gets special tax breaks, and the savings can be used now or accumulated for later. But since the accounts are funded through payroll deductions, holders need to be employed to set them up.
Analysts say Trump’s HSA plan emphasizes consumer control, but requires consumers to budget in advance for anticipated healthcare needs. The accounts also carry some risk: invested funds could lose value, and catastrophic health issues could upend household budgets.
Hospitals and Doctors Would Still Set Prices
The Trump plan would also force pharmaceutical companies to lower prescription drug prices by charging Americans the lowest price paid by other countries. The plan also calls for increasing the number of prescription drugs available over the counter. But most, if not all, of these plans require action from Congress.
For its part, the pharmaceutical industry wants hospitals to become more transparent about the drug discounts they get through the 340B Drug Pricing Program — which requires drug manufacturers to give steep discounts to eligible safety-net hospitals and federally funded health clinics — and an overhaul of health insurers’ pharmacy benefit manager system.
In a statement, Alex Schriver, senior vice president for PhRMA, an industry association, said that the government imposing price controls on drug manufacturers “does nothing to address insurance barriers and would instead threaten access to breakthrough treatments and undermine critical investments that strengthen the U.S. economy.”
‘Affordability’ is Absent
PhRMA also argues that the 340B program has gotten out of hand and that hospitals aren’t passing their savings on to patients.
“Voters are right to be angry about the affordability of health care. Skyrocketing premiums and increasing insurance denials are making it harder for patients to access the care they need,” Shriver said. “Holding insurance companies and PBMs accountable and letting patients buy medicines directly will significantly lower what patients pay.”
There’s no indication that congressional Republicans intend to take up the president’s plan, much less pass it into law. But they are under pressure to address rising health costs, as ACA subsidies expired at the end of December.