Of the myriad policy priorities established by the current administration and congressional leadership, the tackling of skyrocketing prescription drug prices may have the best chance of moving through the legislative process over the next two years. Bipartisan proposals to address rising prescription drug prices have been introduced in both the House and the Senate; President Trump identified the issue in his State of the Union address as his next major priority; and Speaker Pelosi’s first speech to the 116th Congress listed it as a top issue for the new Democratic majority.
Rising prescription drug prices have major budgetary implications for Medicare in particular. Can the program single-handedly place downward pressure on prices without having a negative effect on the rest of the health care system? Join us on Monday, April 1, to hear Cato policy experts Michael F. Cannon and Peter Van Doren discuss the underlying causes of ever-rising prescription drug prices and appropriate policy solutions.
A quarter century ago, the Cato Institute released a revolutionary book, Patient Power: Solving America’s Health Care Crisis, by John C. Goodman and Gerald L. Musgrave. Patient Power introduced the United States to a bold and radical way of thinking about health care.
When third parties pay medical bills, Goodman and Musgrave wrote, providers come to view third-party payers as their customers, not the patients. As a result, instead of maximizing patient satisfaction, providers deliver care to maximize their revenue given third-party payment formulas. Instead of falling, costs rise. Third-party payment is the reason patients can’t talk to their doctors by phone, email, or Skype. It is why patients don’t have Uber-type doctor house calls at night and on weekends. Patient Power showed that if people controlled and managed their own health care dollars, the medical marketplace would change radically—almost overnight.
Indeed, Patient Power changed the world. Thanks largely to Goodman and Musgrave’s work, more than 20 million people are managing their own health care dollars in health savings accounts. A roughly equal number are managing their medical spending through health reimbursement arrangements. And employers are experimenting with giving individuals complete financial control over everything from hip and knee replacements to blood tests.
Come hear the authors of Patient Power and other leading scholars discuss the book’s impact on health reform and how its insights can still inform the debate.