October 30, 2020
Election Day 2020 will mark the end of a divisive election season (or the beginning of the end, depending on how long vote counting takes). For many voters, healthcare has consistently been a top-of-mind issue this election cycle. Democratic and Republican political parties – at national, state and local levels – and presidential candidates have different and competing visions for healthcare policy in 2021 and beyond, which in some cases have driven Americans further apart.
Despite those differences, there is a consensus in healthcare policy that is growing increasingly clear: Price transparency for patients’ medical care and prescription drugs will continue to move forward no matter who claims victory in the 2020 elections.
Just this week, the Trump administration finalized a new healthcare price transparency regulation. It requires insurers to publicly disclose their negotiated prices for medical care and prescription drugs so that patients can understand their medical costs before they receive care or a prescription, instead of only finding out afterward how much their bill will be.
Under the new rule, insurers are required to: (1) create an online tool for patients to use to learn up front the price of prescription drugs and medical care, and (2) make price information public in a way that allows innovators to build tools to help patients control the cost of their medical care and prescriptions. For instance, the data made public under the new rule will let entrepreneurs create healthcare shopping apps that empower patients to shop for needed surgeries at different hospitals, and under competing insurance plans. The rule’s stated purpose is to “drive innovation, support informed, price-conscious decision-making, and promote competition in the health care industry.”
The new regulation faces opposition from national insurance industry advocates. Because of that, it is likely to have to overcome a lawsuit before it can be implemented.
Still, this federal price transparency regulation is just the latest in a series of federal and state price transparency policies to come down in recent years. Late last year, the Trump administration finalized a regulation requiring price transparency from hospitals, which is currently winding its way through the courts after a lawsuit by national hospital industry advocates. At the state level, Utah policymakers just this year enacted a new law creating new state financial transparency rules in the prescription drug market for most market players, including drug manufacturers, insurers and pharmacy benefit managers.
Additionally, there has been recent evidence and analysis suggesting that price transparency, when done right, can help patients lower their medical bills. In some circles, advocates are calling for healthcare price transparency as a new condition of substantial federal healthcare subsidies.
All of these developments point to real momentum behind the idea of creating additional price transparency that would move healthcare and prescription drugs closer to the free market. This new direction in healthcare policy is being noted – even encouraged – among some on the political left. Talking about the new price transparency rule for insurers, for example, a former healthcare policy adviser from the Obama administration said that “transparency is here to stay, even in a Biden administration.”
So despite significant differences in ideological vision, approach and policy ideas, don’t be fooled into thinking that there is no common ground on healthcare and prescription drugs among competing candidates and parties. Almost everyone agrees that informing patients about prices of medical care and prescription drugs before the bill comes due is a good idea. And that is not likely to change – no matter who wins next week.
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