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President Donald Trump recently announced his \u201cGreat Healthcare Plan,\u201d which promises to lower drug prices, lower insurance premiums and maximize price transparency.<\/p>\n
Find Out: Would Trump\u2019s Australian-Style Retirement Be Better or Worse Than the U.S. Plan?\u00a0<\/strong><\/p>\n Read Next: How Middle-Class Earners Are Quietly Becoming Millionaires \u2014 and How You Can, Too\u00a0<\/strong><\/p>\n The announcement comes at a time when many Americans are worried about the rising cost of healthcare. A January KFF survey found that healthcare costs are the top financial worry for many Americans, with two-thirds (66%) saying they are at least somewhat worried about affording the cost of healthcare \u2014 that\u2019s more than the percent that are worried about affording food and groceries, utilities, housing costs and transportation expenses.<\/p>\n But will Trump\u2019s plan actually make healthcare more affordable? Here\u2019s what one expert thinks.<\/p>\n Trump\u2019s plan focuses on several strategies: reducing prescription drug prices through Pharmacy Benefit Manager (PBM) reforms, applying \u201cMost Favored Nation\u201d (MFN) pricing to certain medications, providing insurance premium relief and expanding healthcare price transparency.<\/p>\n While each of these measures could generate savings, Peter Basica, founder of 360 Smarter Care \u2014 a company focused on reducing healthcare costs \u2014 said the overall impact would be modest when spread across the population.<\/p>\n \u201cFor the sake of discussion, let\u2019s say the PBM reforms and MFN reforms perform well above projections at 20% \u2014 the savings amount to $51 billion,\u201d he said. \u201cSpread that over the U.S. population, and it breaks down to $150 per American. While welcome, it doesn\u2019t begin to move the needle.\u201d<\/p>\n Check Out: I\u2019m a Financial Planner: Cut These 7 Hidden Expenses To Save Hundreds a Month\u00a0<\/strong><\/p>\n One proposal would move certain prescription drugs to over-the-counter (OTC) status. On paper, this could lower drug prices and reduce visits to physicians\u2019 offices, urgent care centers and emergency departments. In practice, Basica warned, the change could backfire.<\/p>\n \u201cThis is a terrible idea,\u201d he said. \u201cHospital care is the largest driver of the $5.1 trillion healthcare expense, and 25% of hospital visits could have been avoided if the patient had simply taken their prescription drugs as prescribed.\u201d<\/p>\n Basica said medication adherence is closely tied to the relationship between patients and their primary care physicians.<\/p>\n \u201cThe lack of that personal relationship, the lack of trust in their physician, is directly related to the lack of Basica is skeptical of Trump\u2019s healthcare plan, but he noted that it isn\u2019t a unique issue with this specific plan.<\/p>\n \u201cHow often do government programs deliver what they promise?\u201d he said, pointing to past reforms, like the Affordable Care Act, that were expected to lower costs but fell short.<\/p>\n That said, some elements of the proposal are more feasible than others.<\/p>\n Recent legislation has already codified PBM reforms, making them the most likely to take effect. MFN pricing could also generate real savings \u2014 but only for a small number of the most expensive prescription drugs. By contrast, moving drugs to OTC status may simply shift costs from insurers to consumers.<\/p>\n \u201cMost prescription drugs are covered by some form of insurance with a copay,\u201d Basica said. \u201cMoving a prescription drug to OTC means there will be no insurance coverage, so the cost shifts to the medical consumer.\u201d<\/p>\n Another proposal would attempt to lower insurance premiums by sending funds directly to consumers rather than insurers. While the idea sounds appealing, Basica said the real-world impact would likely be limited.<\/p>\n \u201cIn practice, the healthcare consumer is most likely going to use the subsidy to pay their health insurance premium to an insurance company,\u201d he said. \u201cIn the real world, nothing changes.\u201d<\/p>\n Expanded price transparency is also unlikely to deliver major savings, he added.<\/p>\n \u201cEven a [basic medical] procedure will rarely cost the price posted because of the way the medical billing system is constructed,\u201d he said. \u201cThink of it as the base price for a car with a long list of options. The price on the wall is $100, but the patient is diabetic, hypertensive and overweight. Each one of these conditions is actually a multiplier of the bill.\u201d<\/p>\n Posting prices may be better than posting nothing at all, he said \u2014 but it\u2019s unlikely to transform what patients ultimately pay.<\/p>\n While Trump\u2019s healthcare proposal includes ideas that sound promising, the overall savings for most Americans may be limited. Without bigger structural changes to how care is delivered, paid for and managed, Basica believes the plan is more likely to reshuffle costs than significantly reduce them.<\/p>\n Editor\u2019s note on political coverage: GOBankingRates is nonpartisan and strives to cover all aspects of the economy objectively and present balanced reports on politically focused finance stories. You can find more coverage of this topic on GOBankingRates.com.<\/em><\/p>\n
adherence,\u201d he said. \u201cMoving some of the most common prescription drugs to OTC further erodes the concept of a trusted primary care physician-patient relationship.\u201d<\/p>\n<\/p><\/div>\n