American Action Forum: The Donald has Spoken

American Action Forum: The Donald has Spoken

The reality is that the president cannot use government negotiations to lower drug prices. Despite the repeated assertions to the contrary, there are tons of negotiations in the Medicare drug program. They are private negotiations between and among prescription drug plans, pharmacy benefit managers, and drug manufacturers — and they produce substantial price reductions. The government doesn’t add anything to this mix because it doesn’t have a formulary that would allow it to favor one drug over another, and negotiate a discount in exchange. The reality is that the federal government has no such mechanism to discriminate, and thus no real ability to more effectively negotiate.