The Rx Cost Hot Potato

One of the little-known components of the Trump administration’s efforts to reform healthcare is the rollback or elimination of various subsidies to various pharmaceutical purchasers.

The most recent example, discussed in this Wall Street Journal article, is the proposal to eliminate a deep discount on pharmaceutical products to hospitals with a high indigent care population. One of the concerns regarding this program is that some commercial pharmacy providers have accessed this program as a contract pharmacy for purposes other than originally intended.

While this proposal has no direct impact on private sector plan sponsors, it -- and other proposals -- could have significant long-term effects. For instance, the administration has indicated its desire to negotiate for lower drug prices for Medicare. While this could lower costs in the public sector, reduced revenue and margin for pharma companies could result in cost-shifting to the private sector.   

As with many aspects of pharmacy benefits, pushing costs down in one area often leads to increased costs in another. 

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David Dross
by David Dross

National Practice Leader for Managed Pharmacy Consulting

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