by James Cowell
As a campus ambassador at the University of Tennessee for two prominent non-profit conservative political organizations, the Leadership Institute and Turning Point USA, I’ve come to understand the complexities of health care, both as a public policy issue and as an industry. One critical aspect of health care policy that demands our attention nationwide is the protection of pharmacy benefits, a lifeline for many Americans when it comes to accessing essential prescription medications. As a student, I want to ensure we are preserving free market principles in our health care system for years to come.
Health care costs in the United States are notorious for being exorbitant, rendering many necessary medical treatments and medications financially out of reach for a significant portion of the population. As we navigate the landscape of health care policy, we should recognize the central role pharmacy benefit companies play in helping to alleviate the fallout that everyday Americans experience due to the drug pricing crisis. As a matter of fact, they help save payers and patients $1,040 per person annually, which is no small sum.
Unfortunately, recent trends at the federal level indicate a shift away from free market-based solutions, with “delinking” policies and other proposals targeting our critical pharmacy benefits to gain traction in Congress. These policies specifically target pharmacy benefit companies, eliminating performance-based incentives when they negotiate rebates or secure savings on behalf of employers or patients, among other government mandates with the focus of undermining free market forces in health care.
The core issue lies in the fact that these ‘delinking’ policies fail to address the root cause of the drug pricing crisis. Rather than facilitating genuine solutions, they hinder pharmacy benefit companies from applying the necessary downward market pressure within the pharmaceutical supply chain. To truly make strides in combating rising drug prices, we must encourage healthy competition and empower these companies to enhance affordability for patients and businesses that sponsor their employees’ health plans. Breaking down barriers to competition among pharmaceutical companies can also drive innovation and efficiency, ultimately leading to a more sustainable and affordable health care system.
University of Chicago economics professor Dr. Casey Mulligan recently published a detailed National Bureau of Economic Research (NBER) paper, highlighting the detrimental impact of ‘delinking’ policies on the American healthcare system. The projected consequences of these policies would include a noteworthy surge in annual federal spending on Medicare Part D premiums, escalating them from $3 billion to $10 billion. This potential increase would further strain the financial resources of the federal government and amplify the financial burden on patients and taxpayers.
Furthermore, health care economist and American Enterprise Institute (AEI) senior fellow Alex Brill found that in the Medicare Part D and commercial markets, these policies would result in a massive $32 billion in new profits for Big Pharma each year. In essence, the projected outcomes of ‘delinking’ policies paint a concerning picture of a health care system that prioritizes the interests of drug manufacturers over the well-being and affordability of patients and taxpayers.
It is imperative that our legislators prioritize policies that support the free market principles our nation is built on. Instead of stifling pharmacy benefit companies with counterproductive measures that encourage the federal government to impose stringent regulations, we should empower them to effectively negotiate with Big Pharma to produce real savings for patients, taxpayers, and small business owners. By doing so, we can foster an environment where the pharmaceutical industry is incentivized to prioritize the well-being of patients over profit margins.
As proud Tennesseans, we must actively engage with our elected representatives in Washington to champion policies that protect pharmacy benefits and promote a competitive marketplace for prescription drugs. Our collective voice can ensure that health care policies align with the needs of the people, fostering a system that prioritizes affordability, accessibility and patient-oriented results.
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James Cowell is a political activist and student at the University of Tennessee.
