Biden’s health care agenda will make a broken system worse

With President Joe Biden languishing in the polls, the White House is looking for a strategy to stabilize itself ahead of the 2024 election. According to recent reports, the administration is betting on elevating health care reform into a key campaign platform underpinning support and enthusiasm.

But unfortunately, the Biden administration’s proposals double down on policies that have been proven to make a broken system worse. Biden’s agenda is characterized by increased government intervention that will further impede transparency, free market competition, and patient choice within the U.S. health care system.

Republican 2024 candidates have a great opportunity to propose a counter-reform blueprint that will actually improve patient experiences and health outcomes.

Top of Biden’s health care priorities is expanding drug price controls that were originally enacted as part of the misnamed Inflation Reduction Act (IRA). The regulation forces drugmakers to offer certain products through Medicare at a fraction of the market price. It was a government experiment in manipulating prices that has backfired.

The plan is harming health care innovation and slowing the speed at which new life-saving therapies, therapies and vaccines come to market.

The University of Chicago found that the resulting topsy-turvy incentives and shrinking R&D budgets particularly affected the development of drugs typically taken in pill form. The analysis estimates that there will be nearly 200 fewer therapeutic advances in this area (i.e., small molecule drugs) due to IRA. Expanding government price controls will exacerbate this worrying trend.

In addition, the White House is considering making temporary enhancements to Obamacare subsidies permanent. The bigger payouts — which originated during the pandemic and are set to expire after 2025 — are a clever ploy to mask part of the health care cost crisis with taxpayer money. The strategy uses smoke and mirrors to deceive some Americans into believing health care costs are under control.

U.S. President Joe Biden speaks at the 2023 White House Tribal Nations Summit at the U.S. Department of the Interior on December 6, 2023 in Washington, DC.
Mandelyan/AFP/Getty Images

In effect, the funds transfer program amounts to a temporary Band-Aid that will do nothing to calm long-term inflationary pressures in health care. And extending the policy indefinitely would mean that middle-class families who don’t qualify for subsidies will continue to be squeezed financially, while everyone else turns a blind eye to the real problem.

Instead of pursuing this harmful mix of policies, the government should root health care reform in transparency, free market competition, and patient choice.

For example, to address high drug costs, policymakers should address drug supply chain intermediaries. These entities, known as pharmacy benefit managers, take advantage of opaque, anticompetitive markets to profit at the expense of patients. Nationwide, just three people are responsible for managing 80% of drug prescriptions.

A recent economic analysis found that these middlemen use their dominant position to influence how doctors prescribe drugs, often steering patients toward more expensive drugs to increase profits. Additionally, pharmacy benefit managers absorb billions of dollars each year from the drug market, funds that are intended to be passed on to patients at the pharmacy counter as financial savings.

Next year’s policy platform should also include loosening government regulations related to Obamacare that limit patient choice. Americans should have free access to a variety of health care coverage options—from catastrophic care to platinum plans—that best fit their unique situation. After all, the needs of a healthy 20-something are very different from those of someone approaching retirement.

Other policies that need to be pursued are the expansion of health savings accounts and the promotion of innovative direct primary care business models. The combination will give patients further control over their healthcare costs while providing healthcare options beyond the traditional insurance model.

As health care policy takes on a more prominent role in the upcoming election, candidates have a chance to win over voters. A smart, substantive health care agenda that prioritizes choice, competition, and transparency is the winning ticket.

Dr. Tom Price served as the 23rd U.S. Secretary of Health and Human Services and is a senior health care policy fellow at the Job Creators Network.Elaine Parker is president of the Job Creators Network Foundation, which manages Policy reform framework.

The views expressed in this article are the author’s own.