Trump Unveils Plan to Slash Cost of Medicare Medication

President Donald Trump touted Thursday his “American patients first” approach, saying that he would limit federal payments for some Medicare drugs based on prices paid in other developed countries. At the same time, he also accused the world of “freeloading” off “American genius” in drug development and testing.

“We are taking aim at the global freeloading that forces American consumers to subsidize lower prices in foreign countries through higher prices in our country,” Trump said during a speech at the Department of Health and Human Services. “I have seen it for years and never understood. Same company, same box, same pill, made in the same location, and you will go to some countries and it will be 20 percent [of the cost of drugs in the United States] because of what we pay and, in some cases, much less than that. I say, ‘Why is this’?”

President Trump’s approach, however, was met with criticism from a coalition of drug makers, who say that it would eventually hurt American patients.

Under the plan, the government would limit what it pays for certain drugs administered by physicians, including cancer medication, ABC News writes. The changes will take place over a five-year period and would initially affect only half of the population, but people won’t feel the effects at least for some time.

The HHS predicts that the move would reduce Medicare payments for these medications by 30 percent. Officials further believe the initiative would discourage doctors from choosing more expensive drugs. Under the current system, doctors are reimbursed for drugs with an added percentage fee, but with the new approach, they would make the same amount of money regardless of the drug they choose.

The drug industry opposed the decision, saying that U.S. patients have access to more sophisticated medicines significantly earlier than in other developed countries as a result of innovation.

“The administration is imposing foreign price controls from countries with socialized health care systems that deny their citizens access and discourage innovation. These proposals are to the detriment of American patients,” said Stephen J. Ubl, president and CEO of the Pharmaceutical Research and Manufacturers of America.

The move would decrease the cost of some Medicare drugs making it much more likely that additional states would move to expand Medicaid coverage for low-income Americans.

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