Could Trump finally tackle the middlemen driving up America’s healthcare costs? A new proposal from Americans for Limited Government urges the President to target Pharmacy Benefit Managers (PBMs) who control 80% of U.S. prescriptions and allegedly inflate prices at patients’ expense.
At a glance:
- President Trump recently signed an Executive Order enhancing healthcare price transparency
- PBMs control approximately 80% of U.S. prescriptions and are accused of manipulating drug prices
- Medicaid lost $50 billion to improper payments in 2023, highlighting systemic waste
- The 340B drug program is criticized for benefiting hospitals and PBMs rather than patients
- Economic analysis suggests potential savings of $80 billion by 2025 through transparency reforms
Trump Takes Aim at Healthcare Costs
President Donald J. Trump recently signed an Executive Order designed to enhance healthcare price transparency across the nation. The order mandates that the Departments of Treasury, Labor, and Health and Human Services strictly enforce healthcare price transparency regulations that require hospitals and insurers to disclose actual prices—not estimates—including those for prescription drugs.
The initiative aims to make healthcare costs comparable across hospitals and insurers, potentially saving Americans billions of dollars through informed choices.
“Our goal was to give patients the knowledge they need about the real price of healthcare services. They’ll be able to check them, compare them, go to different locations, so they can shop for the highest-quality care at the lowest cost,” explained President Trump.
Economic analysis suggests the nation could save approximately $80 billion by 2025 if these transparency rules are fully implemented. Employers could reduce healthcare costs by 27% on 500 common services through better price shopping, a significant benefit for working Americans.
PBMs: The Hidden Healthcare Powerbrokers
A new proposal from Americans for Limited Government urges the Trump administration to focus specifically on Pharmacy Benefit Managers (PBMs), describing them as manipulative intermediaries in the pharmaceutical supply chain. These middlemen currently control approximately 80% of U.S. prescriptions, wielding enormous influence over what medications Americans can access and at what price.
Critics argue that PBMs thrive on inefficiency, inflate drug costs, and reduce patient choice while claiming significant revenues for themselves. The system has resulted in complex pricing schemes that mask the true cost of medications from consumers and healthcare providers alike.
The Biden administration faced a lawsuit in 2023 for failing to enforce prescription drug transparency requirements. This lack of enforcement allowed PBMs to continue operating without proper oversight.
Reforming Broken Systems
The proposal also targets inefficiencies in existing healthcare programs that have become cash cows for middlemen rather than serving patients. Medicaid lost an astounding $50 billion to improper payments in 2023 alone, revealing the enormous waste present in the current system.
The 340B drug pricing program, originally designed to help vulnerable patients access medications, has become controversial as critics claim hospitals and PBMs pocket the savings rather than passing them to patients. Reform advocates argue that exposing and fixing these problems could both reduce healthcare spending and improve patient care.
