A Presidential Call for Transparency in Healthcare

J0399828 Recently the President has been calling for more transparency in healthcare pricing.  Initially he is talking about how hospitals and healthcare plans operate.  But as the realities of Medicare Part D begin showing themselves, that call may broaden to the pharmaceutical industry, with the focus on pricing.

There are milestones in the Part D implementation that could cause this.  Apart from the train wreck of sign-up, there is also the dreaded "donut hole".   The Part D benefit pays for coverage up until the time that a senior hits a certain level, at which point, they are on their own until they reach a higher spending level.  That means that for many there will be the ugly realization that drugs that were covered in the beginning of a year, suddenly are not as the year progresses.  That will evoke a reaction.

The second milestone is connected with the Plan’s price tag that will inevitably, in a time of growing budget constraints, cause policy makers to question what exactly they are paying for – a drug or marketing expenses and the call for transparency in pricing my resonate and expand.  As government becomes a bigger and bigger payer for prescription drugs, pharmaceutical companies need to prepare now for serious questions about what part of pricing is attributable to marketing.  It is not at all certain that the traditional industry statements in response to this inquiry may fall on deaf ears as policy makers scramble to bring the federal budget under some semblance of control.   

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