Trump Plans Executive Order To Help Lower Health-Care Costs

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While Democrats dither over the virtues of ‘Medicare for All’, the Trump administration is about to embark on an all-out offensive to lower health-care costs in the US.

According to WSJ, Trump is preparing an executive order that would force health-care providers – hospitals, internists, specialists etc. – to disclose the discounted and negotiated rates for various procedures that they negotiate with insurance companies. The order would force more transparency among health-care pricing, an industry that is accustomed to transacting in private.


The idea is that more price transparency would improve consumer choice and stoke more competition, which could exert downward pressure on prices. However, previous attempts to introduce more transparency to the industry have been vehemently resisted by special interests. President Trump is also working on an initiative to lower the cost of prescription drugs.

For example, patients would be able to see the price of a routine scan – like a CAT scan – in advance. If one clinic wants to charge $5,000 for the procedure, the patient can check with another clinic and shop around for the best price. The stunning lack of transparency in this market has allowed for immense cost disparities to persist between various providers – prices that are often completely divorced from the actual cost of the procedure.

The White House is planning a meeting on Friday to iron out the last details of the order.

A bipartisan plan introduced in the Senate is seeking to accomplish something similar by mandating that providers disclose the price of a given procedure within 48 hours of the request.

As WSJ revealed in a blockbuster report published last summer, the opacity surrounding medical-services pricing has sometimes led hospitals to wildly inflate the costs of some of the most common procedures. After receiving complaints about the price of a $50,000 knee surgery from Medicare, the hospital set out to determine how much the surgery actually cost.

The answer? Just $10,550, including the surgeons and the anesthesiologist.

The Trump administration is also weighing whether to use the DoJ’s anti-trust authority to break up regional hospital monopolies and encourage more competition.


For years now, health-care costs have dramatically outpaced consumer-price inflation. One researcher who monitored health-care costs over a five-year period from  the beginning of 2012 to the end of 2016 found average costs nationally rose by 16%, roughly three times the rate of inflation.

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