• Home
  • Latest
  • Fortune 500
  • Finance
  • Tech
  • Leadership
  • Lifestyle
  • Rankings
  • Multimedia

Trendingnow

1

He worked 100-hour weeks to save a nearly bankrupt boat company. At 83, he’s just turned down $400 million for it—and gave it all to charity instead

2

Costco's $14 million email settlement: Who qualifies for an up-to $500 payment and how to claim before the Aug. 24 deadline

3

Mamdani’s pied-à-terre tax was designed to hit the wealthy, but it’s sending most New Yorkers to their estate lawyers

1

He worked 100-hour weeks to save a nearly bankrupt boat company. At 83, he’s just turned down $400 million for it—and gave it all to charity instead

2

Costco's $14 million email settlement: Who qualifies for an up-to $500 payment and how to claim before the Aug. 24 deadline

3

Mamdani’s pied-à-terre tax was designed to hit the wealthy, but it’s sending most New Yorkers to their estate lawyers
Health

Why Trump’s Plan to Keep Drug Prices in Check Would Revive ‘Death Panel’ Politics

By
Sy Mukherjee
Sy Mukherjee
Down Arrow Button Icon
By
Sy Mukherjee
Sy Mukherjee
Down Arrow Button Icon
January 13, 2017, 4:21 PM ET
Donald Trump
President-elect Donald Trump speaks during a news conference in the lobby of Trump Tower in New York, Wednesday, Jan. 11, 2017. (AP Photo/Evan Vucci)Evan Vucci—AP
Add Fortune on Google for similar content.

President-elect Donald Trump sent biopharma stocks into a tailspin Wednesday after asserting that pharma is “getting away with murder” on drug prices during a closely-watched press conference. But Trump’s suggestions for keeping these high prices in check through a bidding process for Medicare could re-invigorate the nastiest political debates about “care rationing” that surrounded the Affordable Care Act, aka Obamacare.

For some context: Obamacare contained a pretty wonky (but significant) provision called the Independent Payment Advisory Board (IPAB). This, along with certain other parts of the law, eventually got heaped under the “death panels” slur that former half-term Alaska Governor Sarah Palin famously used to criticize the Affordable Care Act (and which was subsequently named PolitiFact’s Lie of the Year in 2009).

IPAB is supposed to be triggered once spending growth in the Medicare program for the elderly crosses a certain threshold. The 15-member panel – which has never actually been invoked since Medicare’s never hit the magic number – would then propose a variety of cuts in payments doled out to doctors, drug companies, and other health industry stakeholders in order to rein in spending. Palin and other critics decided to label this fairly innocuous cost-cutting mechanism as “care rationing” that would let government bureaucrats decide whether or not granny gets to live (again, this is not actually true).

Click here to subscribe to Brainstorm Health Daily, our brand new newsletter about health innovations.

The board, even in its current purely theoretical form, is likely not long for this world given that the Obamacare repeal train is chugging along. But Trump’s assertion that the federal government must start a bidding process for drugs in order to control prices and spending could very well invite similar criticisms from political opponents and the well-funded drug industry.

That’s because price-based bidding for market access only works if the programs that pay for drugs have the power to reject certain treatments, even if they’re clinically effective, as long as they’re found not to be cost-effective.

Bidding for drug prices means Medicare has to be able to decline to cover drugs with unsatisfactory bids. Expect death-panel-esque politics.

— Adrianna McIntyre (@adrianna.bsky.social) (@onceuponA) January 11, 2017

This is something that’s played out time and time again in other countries where government watchdogs determine which therapies are eligible for funding and which aren’t.

For instance, the U.K.’s National Institute for Health and Care Excellence (NICE) has locked horns with numerous pharma giants over drug pricing. Merck’s superstar cancer immunotherapy Keytruda, credited with clearing Jimmy Carter’s cancer, was originally rejected for routine National Health Service (NHS) funding before the drug maker held more extensive negotiations with the agency; at one point, AstraZeneca CEO Pascal Soriot warned that NICE’s aggressive attitude toward high-priced cancer drugs would sap pharmaceutical innovation and patient choice in the U.K.

Even when private insurers and benefits managers decide to leave a treatment off their formularies (i.e., their lists of covered products), it usually causes a stir. For example: Cigna’s decision this week to drop coverage of the EpiPen in favor of a cheaper competitor and pharmacy benefits manager Express Scripts’ original controversial decision to snub Gilead’s hep C cure Sovaldi in favor of a competitor from AbbVie.

So just imagine the backlash if the Secretary of Health and Human Services (HHS), who oversees Medicare, had the power to reject a rare disease treatment like Vertex’s pricey cystic fibrosis drug Orkambi (which still doesn’t receive NHS funding in the U.K.) over an inadequate bid. It’s not hard to see a scenario where the pharma lobby enlists an outraged parent of a cystic fibrosis patient to decry government overreach that restricts patient choice.

Competitive bidding could very well be an effective way of fighting sky-high drug prices that are taking a toll on patients and their families. But in a country like the U.S., where drug makers are used to getting their products covered and many patients are used to the option of accessing a wide array of medicines if they so choose, the policy would get some fierce political pushback from powerful stakeholders.

About the Author
By Sy Mukherjee
See full bioRight Arrow Button Icon
Add Fortune on Google for similar content.

Latest in Health

Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025

Most Popular

Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Fortune Secondary Logo
Rankings
  • 100 Best Companies
  • Fortune 500
  • Global 500
  • Fortune 500 Europe
  • Most Powerful Women
  • World's Most Admired Companies
  • See All Rankings
  • Lists Calendar
Sections
  • Finance
  • Fortune Crypto
  • Features
  • Leadership
  • Health
  • Commentary
  • Success
  • Retail
  • Mpw
  • Tech
  • Lifestyle
  • CEO Initiative
  • Asia
  • Politics
  • Conferences
  • Europe
  • Newsletters
  • Personal Finance
  • Environment
  • Magazine
  • Education
Customer Support
  • Frequently Asked Questions
  • Customer Service Portal
  • Privacy Policy
  • Terms Of Use
  • Single Issues For Purchase
  • International Print
Commercial Services
  • Advertising
  • Fortune Brand Studio
  • Fortune Analytics
  • Fortune Conferences
  • Business Development
  • Group Subscriptions
About Us
  • About Us
  • Press Center
  • Work At Fortune
  • Terms And Conditions
  • Site Map
  • About Us
  • Press Center
  • Work At Fortune
  • Terms And Conditions
  • Site Map
  • Facebook icon
  • Twitter icon
  • LinkedIn icon
  • Instagram icon
  • TikTok icon
  • YouTube icon

Latest in Health

tb
North AmericaRestaurants
Taco Bell’s quick action on removing lettuce, $1 Mexican Pizza special work to win over diners, investors
By Dee-Ann Durbin and The Associated PressJuly 30, 2026
1 hour ago
Photo of two polar bears
Environmentclimate change
Polar bears roll in beds of ice cubes at Prague Zoo as Europe battles record heat
By The Associated PressJuly 30, 2026
2 hours ago
mold
HealthCDC
‘Kind of the first time we’ve had an estimate like this’: first CDC study on mold finds it’s much deadlier than we thought
By Mike Stobbe and The Associated PressJuly 30, 2026
3 hours ago
f
CommentaryPandemic
Dr. Fauci, the Lockdown Czar, just won’t go away
By Steve H. HankeJuly 29, 2026
18 hours ago
f
North AmericaWhite House
Beyond the Covid origins: Fauci’s pandemic diary reveals a starstruck Julia Roberts and Trump gasping for oxygen
By The Associated PressJuly 29, 2026
18 hours ago
f
LawCongress
RFK says he found Fauci’s diary in government archives as Fauci invokes the Fifth Amendment over 100 times
By Lauran Neergaard, Ali Swenson and The Associated PressJuly 29, 2026
19 hours ago

Most Popular

He worked 100-hour weeks to save a nearly bankrupt boat company. At 83, he’s just turned down $400 million for it—and gave it all to charity instead
Success
He worked 100-hour weeks to save a nearly bankrupt boat company. At 83, he’s just turned down $400 million for it—and gave it all to charity instead
By Preston ForeJuly 29, 2026
1 day ago
Costco's $14 million email settlement: Who qualifies for an up-to $500 payment and how to claim before the Aug. 24 deadline
Retail
Costco's $14 million email settlement: Who qualifies for an up-to $500 payment and how to claim before the Aug. 24 deadline
By Sydney LakeJuly 29, 2026
1 day ago
Mamdani’s pied-à-terre tax was designed to hit the wealthy, but it’s sending most New Yorkers to their estate lawyers
Real Estate
Mamdani’s pied-à-terre tax was designed to hit the wealthy, but it’s sending most New Yorkers to their estate lawyers
By Catherina GioinoJuly 30, 2026
9 hours ago
Millionaires are leaving the U.K. in droves thanks to tax hikes—but the CEO of $1 billion tax platform says it’s their ‘social responsibility’ to stay
Success
Millionaires are leaving the U.K. in droves thanks to tax hikes—but the CEO of $1 billion tax platform says it’s their ‘social responsibility’ to stay
By Orianna Rosa RoyleJuly 29, 2026
1 day ago
Current price of oil as of July 29, 2026
Personal Finance
Current price of oil as of July 29, 2026
By Joseph HostetlerJuly 29, 2026
1 day ago
Foreign buyers seem to be following Zohran Mamdani's cue — and fleeing American real estate
Economy
Foreign buyers seem to be following Zohran Mamdani's cue — and fleeing American real estate
By Nick LichtenbergJuly 29, 2026
1 day ago

© 2026 Fortune Media IP Limited. All Rights Reserved. Use of this site constitutes acceptance of our Terms of Use and Privacy Policy | CA Notice at Collection and Privacy Notice | Do Not Sell/Share My Personal Information
FORTUNE is a trademark of Fortune Media IP Limited, registered in the U.S. and other countries. FORTUNE may receive compensation for some links to products and services on this website. Offers may be subject to change without notice.