Vice President Pick Vance’s views on healthcare dissent from GOP orthodoxy

Senator J.D. Vance’s positions on health care run counter to traditional views of the Republican Party, which typically views government interference in the marketplace as a problem, not a solution. The vice presidential candidate has expressed support for several interventionist federal government policies. In key areas, Vance’s position on health care policy mirrors that of former President Trump, suggesting that subtle shifts are underway within the Republican Party toward a less purist free-market ideology.

Former President Donald Trump this week appointed JD Vance as his running mate and vice presidential nominee.

Vance has been actively involved in a number of issues related to health and healthcare. For example, as venture capitalist Vance invested in life sciences companies exploring gene therapies and precision medicine. He has been vocal about the opioid crisis. Vance’s memoirs, Hillbilly elegy, depicts his own family’s struggle with opioids in rural Ohio. And like many Republicans, Vance opposes gender-affirming care for minors and abortion. At the same time he supports accessibility against the abortion pill mifepristone, despite many conservatives wanting the drug to be banned.

And on health care policy, while it’s difficult for a senator to learn much from Vance’s voting record, given that he has only been in the Senate for 18 months, statements and interviews show that he holds certain positions that “work against his party,” he said The hill.

What’s particularly notable is that Vance has not been supportive of the Republican Party’s efforts to repeal the Affordable Care Act, known as Obamacare. Politics notes that, for example, he has cited the importance of the ACA’s legal protections for people with pre-existing conditions. The law states that health insurers may not deny coverage or charge someone more because of pre-existing health conditions.

In key areas, Vance and Trump are aligned on health care. Notably, Vance doesn’t believe in full-throated laissez-faire approach to healthcare will solve all the problems in the system. He embraces an important role for government, as does Trump, which is consistent with the kind of economic populism favored by both men.

In a interview With AARP in 2022, Vance said he is in favor of allowing Medicare to negotiate drug prices, which is a key provision in the Inflation Reduction Act, which was signed into law by President Biden in 2022. Remarkably, in the run-up to the 2016 elections, Trump advocated Medicare drug price negotiations during the campaign. And while president, he issued executive orders that would have instituted a “most favored nation” drug pricing policy. This would have required pharmaceutical companies to sell certain drugs to Medicare at the lowest price they offer to a number of comparable countries in terms of gross domestic product per capita. The use of international price references was firmly against by many fellow Republicans.

During former President Trump’s first term, his administration offered a “blueprint.” to suggest the “most dramatic action in history to lower the price of prescription drugs for the American people.” The Department of Health and Human Services wanted to improve the way the market functioned by greater transparency, hoping to provide consumers with more and better information. Importantly, HHS has also proposed explicit government-led measures aimed at lowering the prices patients pay for prescription drugs at the pharmacy counter.

Trump signed the executive order orders designed to, in his words, “completely restructure the prescription drug market.” These include the aforementioned most favored nation proposal, as well as a possible overhaul of the pharmacy benefit discount system in Medicare’s Part D outpatient program.

Rebates are payments from drug manufacturers to PBMs in exchange for shifting market share to preferred products on the formulary. Decades ago, federal regulations established a so-called safe harbor for PBM rebates, which prevents them from being treated as kickbacks. Trump’s executive order would have done that narrowed the safe harbor for rebates significantly under the Anti-Kickback Statute.

Effectively eliminating the Safe Harbor exemption would have forced PBMs to either forego rebates entirely or pass them on directly to Medicare beneficiaries.

Although these executive orders were ultimately not implemented, one of Biden’s signature laws, the Inflation Reduction Act, for the first time authorized Medicare to negotiate the prices of a limited subset of prescription drugs. In addition, PBM rebates, administrative fees, and spread pricing (PBMs charge health plans and employers a higher price for drugs than what they pay to pharmacies, keeping the difference as profit) are now under intense scrutiny by the Federal Trade Commission and Congress. The FTC is currently involved in a lengthy investigation into PBMs and their alleged anti-competitive business practices.

Vance has praised Lina Khanchairman of the FTC, for her antitrust enforcement work and “building a more competitive marketplace.”

This fits with the populist message that Vance and Trump want to convey, in which there is more supervision of pharmaceutical companies, PBMs and other major companies and the government ensures that voters are not disadvantaged by the health care system.