COA Commends Trump’s Executive Order to Lower Prescription Drug Prices
The President’s Executive Order on Lowering Drug Prices by Once Again Putting Americans First is a step in the right direction to stop the out-of-control costs of health care at the hands of hospital systems and pharmacy benefit managers (PBMs).
Consolidating Hospital Systems and Pharmacy Benefit Managers Are Profiting off of the Backs of Americans
Statement from Ted Okon, Executive Director, COA
The President’s Executive Order on Lowering Drug Prices by Once Again Putting Americans First is a step in the right direction to stop the out-of-control costs of health care at the hands of hospital systems and pharmacy benefit managers (PBMs). Additionally, the Community Oncology Alliance (COA) commends the Executive Order for expediting the approval of biosimilars and eliminating the Inflation Reduction Act (IRA) “pill penalty” that reduces the incentive to invest in certain non-biologic drugs that are critical in the treatment of cancer and other serious diseases. As the Department of Health & Human Services (HHS) is ordered to improve the IRA drug negotiating processes, we implore the agency to make a “technical fix” to remove physicians from the negotiations between HHS and pharmaceutical manufacturers because, currently, physicians face a devastating $25 billion loss in payments.
Consolidating hospital systems, which are supposedly “non-profit” entities, are excessively profiting off of prescription drugs by buying low through the 340B Drug Purchasing Program and then exorbitantly marking them up. A study by COA shows that hospitals charge patients an average of 3.8 times the cost for already expensive cancer treatments. Another study by researchers at the University of California Berkeley found that hospital outpatient department prices were double those paid in physician offices for cancer drugs, and that patient out-of-pocket costs are substantially higher for hospital-based cancer care. The Congressional Budget Office published analyses that Medicare excessively overpays hospitals for 340B drugs and so-called “site-neutral” service payment upcharges of close to a quarter of a trillion dollars.
It is now common knowledge that PBMs operate in an opaque market that allows them to literally extort drug price concessions from pharmaceutical companies that end up in their pockets rather than Americans. Although Congress has introduced numerous bills to stop PBM abuses, it has been unable to pass these into law. This inaction has simply emboldened PBMs to further fuel drug costs and delay and deny treatment for cancer patients and other Americans with serious diseases.
As COA described in its recently-released COA Prescription for Health Care Reform, the problem with runaway health care costs in this country starts with consolidating hospital systems and PBMs. Mega hospital systems are forcing out lower-cost independent physician practices and creating medical “deserts” in rural areas as smaller independent hospitals struggle. Likewise, PBMs and their corporate insurers are doing the same with prior authorization hurdles for physicians and low-ball reimbursements to independent pharmacies, creating and expanding pharmacy “deserts” across the country. The COA Prescription lays out specific treatment plans for Congress to implement, which are all extensively documented by published research.
Hopefully, the President’s Executive Order will not only result in regulatory action by HHS and their Centers for Medicare & Medicaid Services (CMS) but will also motivate Congress to stop hospital and PBM profiteering off of the backs of Americans.
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About the Community Oncology Alliance: The Community Oncology Alliance (COA) is a non-profit organization dedicated to advocating for community oncology practices and, most importantly, the patients they serve. COA is the only organization dedicated solely to community oncology where the majority of Americans with cancer are treated. The mission of COA is to ensure that patients with cancer receive quality, affordable, and accessible cancer care in their own communities. More than 1.5 million people in the United States are diagnosed with cancer each year and deaths from the disease have been steadily declining due to earlier detection, diagnosis, and treatment. Learn more about COA at communityoncology.org.
