|Price controls prevent drug companies from even having a chance to profit, thus destroying the incentive to invest. Developing a new prescription drug is an extremely risky endeavor, typically taking up to 15 years and $2.6 billion. The failure rate is extremely high; about 9-in-10 experimental drugs that enter clinical trials never receive regulatory approval. Investors are only willing to fund this risky research because they might profit if a drug is successful. Artificially capping drug prices would also discourage research and the development of tomorrow’s miracle drugs.|
Short-term plans are temporary insurance plans that provide health coverage for individuals and families for a limited period—and can be renewed for up to three years. Short-term plans can be purchased at any time, unlike other plans available on the individual market which restrict enrollment to open enrollment periods or following a life-changing event. Coverage usually begins within a few days compared to other medical coverage that can take several weeks to begin. Because short-term plans are not subject to all of the same federal regulations as plans in the individual market, premiums are far more affordable and insurers can offer more customized choices. So why would nearly a dozen states ban them?
The CMS issued a proposed rule on Thursday that would cut Affordable Care Act user fees and laid the groundwork to eliminate “silver-loading.”
In its proposed notice of benefit and payment parameters for ACA exchanges in 2020, the agency proposed reducing the exchange user fee that is charged to health insurers to fund the health insurance exchanges. That would help lower premiums in 2020, the agency said.
In October, the Trump administration proposed a new rule that would expand the ways employers can use health reimbursement arrangements (HRAs) to provide their employees with high-quality, low-cost health coverage. The United States Department of the Treasury estimates that once the new rules go into effect, 800,000 employers will take advantage of HRAs, which could affect coverage for more than 10 million employees.
The Trump administration is readying guidance that could let states remodel their Medicaid programs to more closely resemble block grant proposals favored by Republicans during their failed effort to repeal the Affordable Care Act, according to people familiar with the discussions.
States would still have to adhere to certain requirements but could get far more leeway in how they design their programs, likely in exchange for some type of cap on federal funding, the people said. The guidance would lay out how states could satisfy federal requirements to get waivers to pursue the changes, they said.
The primary concerns with this model include:
Restricted access to existing medicines: The 14 countries that the Centers for Medicare & Medicaid Services (CMS) has proposed referencing in this IPI model, on average, have access to only 48 percent of the new drugs developed in the past eight years, and it took an average of 16 months after their initial global launch for those drugs to become available in those 14 countries. If the United States adopts the prices of those countries, American patients may very well face the same access restrictions as exist in those countries and lose access to existing treatment options.
Give Working Families A Break
The Trump administration is using its regulatory authority to provide Americans more flexibility and choices of affordable health coverage, but it should take additional steps to help working families struggling with the cost of health coverage.
The administration has proposed allowing employers to establish defined contribution arrangements that enable their employees to purchase health insurance plans available outside the workplace.
But an important new option would be for an employee to use an HRA contribution to buy into their spouse’s plan at work.
Most of the real action on health reform is likely to happen in the regulatory space over the next two years, and the Trump administration can build on the opportunities it already has created with a regulatory fix that would increase access to health insurance for working families.
We submitted a comment letter on Friday recommending a change to the administration’s proposed rule that adds flexibility to Health Reimbursement Arrangements. We recommend the administration also allow funds from one spouse to be used to buy into group health coverage offered by the employer of the other working spouse.
About one-fourth of employees offered health insurance at work do not participate, generally because of cost. This change would increase uptake by allowing spouses to use funds deposited into an HRA account by one employer to obtain a family insurance policy offered by the other spouse’s employer.
President Trump was elected on his promise to stop other nations from taking advantage of the United States. Our allies let us pay for most of their own national defense needs. Treaties allowed once poor countries to hit American products with tariffs and trade barriers. The Paris agreement on climate change burdened our manufacturers and workers, while letting China and India build and expand without such onerous restrictions.
FDA Commissioner Scott Gottlieb blasted insulin makers Tuesday for what he called unacceptably high prices for a decades-old drug. And he rolled out a slate of new guidances for the industry he says will spur competition in the insulin market and bring down the drug’s cost when they take effect in 2020.
But in a speech at this week’s FDA/CMS Summit, Gottlieb stopped short of endorsing policies gaining steam on Capitol Hill that would dramatically change how insulin makers do business.