Election 2024: Trump vs. Harris: How Their Healthcare Policies Could Reshape the United States

In this timely episode, Dr. Anthony Paravati and Dr. Amar Rewari break down the healthcare implications of a Trump or Harris presidency. From prescription drug pricing and Medicare reforms to Medicaid block grants and the Affordable Care Act, this episode provides a nonpartisan, in-depth analysis of each candidate's position on healthcare. Discover what the future could hold for U.S. healthcare policies, costs, and patient access depending on the election's outcome. This is a can't miss episode before heading to the polls.

Introduction to the Election Episode

All right, Amar, I can't believe you've talked me into an election episode. There you go. Well, three weeks from now, it's a big deal. And I think our listeners need to hear what's going on with Harris, Trump, and healthcare. Let's get into it.

All right, Amar, which of the laundry list do you want to tackle first?

You know, Anthony, I think we have some good topics to talk about with Trump and Harris. We'll try to be nonpartisan. I don't know who you're voting for. I don't think you know who I'm voting for. But I think we'll just try to be objective and just talk about their policies. But I think what would be good is we talk about prescription drug pricing, Medicare, the Affordable Care Act, and just other policy proposals of them and go from there.

Prescription Drug Pricing and Comparisons

All right, let's do it. So where do you want to start first? How about drug pricing? It seems like that's really a major issue with the cost of drugs skyrocketing in this country.

Yeah, it's an interesting issue. Seems like it's an issue where maybe out of all of these things, at least directionally, the candidates have something in common. Yeah. I think both Trump and Harris are both looking at ways to curtail out-of-control costs for our senior population with prescription drugs. And a 2024 RAND study pretty much found that the United States pays triple what other developed countries pay for prescription drugs.

That's triple. Yeah. And it's bizarre to me that we got to whatever year it was when people finally started to talk about, and then when Trump first and Harris now are talking about negotiating the prices that Medicare pays for drugs.

Right. And what's another interesting little tidbit is that while prescription drugs are so expensive in the US, generics are actually about a third cheaper in the US than other developed countries. So there's definitely some potential opportunities here for savings.

Trump's Executive Orders on Drug Imports

I think maybe we could talk a little bit about what happened under Trump and what he did to help kind of rein in some of this out-of-control prescription pricing. So he had issued a few executive orders. Right, Anthony, and one of them was to allow drugs to come in from Canada and other countries where it's much cheaper.

Yes. And I seem to remember always hearing this sort of line again and again, the so-called most favored nations rule. Right. Is that under Trump or am I...

No, that's exactly it. So pretty much he was trying to say that some of these other countries where the drugs are much cheaper, why are we paying so much? So we should match our pricing to these other countries and the pharma companies should match it.

But you would think there would be some kind of criticism and downside with that, right?

Yeah. It's always the retort from the manufacturers and really from that whole industry in general—not only the manufacturers, but other sort of aligned parts of the value chain—that you're going to undermine innovation, undermine the speed of new drug development. And also you're giving potentially other countries more power in the negotiation. If the US is setting our prices based on another country, so they would have the leverage to negotiate with the pharma companies and not us.

It's an interesting kind of inversion of what we see in basically every other sector of the economy where, because the US Dollar is the reserve currency and other countries sort of tie what things cost, they're expressed in dollar terms, we have a great deal of power—those who earn in US Dollars and then by extension, obviously, the US Government because of that. So it's sort of a direct inversion. We're chaining our prices to the price that's being paid elsewhere.

Pharmacy Benefit Managers (PBMs)

Right. And some of the other things Trump did with his executive orders was trying to prevent these drug companies from negotiating discounts, and then they're keeping those discounts or rebates. So it was to prevent them from keeping that, allowing transparency so people could see what the drug companies are keeping. Because I know you've done a lot with PBMs in your career, and they've just gained so much more power over the last few years.

Yeah, exactly. Basically dictating the flow of funds from the acquisition of the medicine from the manufacturer and then the flow from there through the specialty pharmacies. You have unbelievable power there. And patients end up, unfortunately, paying quite a lot more for drugs that in reality cost less on the economy.

Oh, yeah. And the drug companies come out ahead. So under the Harris administration, the FTC actually sued the three big PBMs precisely because of this pricing difference.

Exactly. The ability to dictate prices and the ability to make it so that the end user, the patient, effectively is overpaying. Overpaying in a big way. 2000% or higher in many cases.

Insulin Costs and the Inflation Reduction Act

Right. And with typical campaigning, both Harris and Trump are both trying to take the win for insulin pricing. So Harris claims that with the Inflation Reduction Act that she signed as the tiebreaker as vice president, that it capped it at $35. But Trump says that actually it started with his administration with a voluntary model for reduced pricing for insulin. So they both have some claim to that, I think.

Yeah, that's right. And that's why in the spirit of bipartisanship, in the spirit of being positive, I'm glad we started with prescription drugs. It seems to be one aspect of the entire healthcare system where there is some bipartisan, as I say, commonality or shared directionality about how they want to take things that is lower cost to the patient. I mean, that's a crowd pleaser, obviously.

So some of the other things the Inflation Reduction Act did is exactly what you were saying earlier, that it allowed for the government to negotiate drug prices with these pharma companies, which up until then Medicare couldn't do. And so coming in 2025, there's going to be an additional 10 drugs that are now going to be allowed to be negotiated beyond insulin. And then every year thereafter, it's going to be an additional 10 to 20 drugs going for the next five years.

And so Harris wants to expand that to even more drugs and then she also wants to put a cap of $2,000. So like an elderly person in Medicare for drugs, the out-of-pocket costs shouldn't exceed $2,000.

And what's the estimate on that? So if the out-of-pocket cost is 2000 and the overall cost to produce in general the drugs consumed by your average Medicare beneficiary in the US and you take that across all of them, we're talking about it would... Now I'm going to guess that it's north of 200 billion.

Oh, keep going, keep going. Is it 400?

Yeah, it's close to almost $500 billion over 10 years, right? Yeah, the CBO, that's what they're estimating. And so we'll see a common theme. I think that a lot of these proposals of Harris, while they would expand coverage and make things more affordable, it comes at a cost. Nothing's free, there's no free lunch. Some of this stuff, she's really swinging for the fences.

And I mean if they were to come to pass, they would be obviously very positive for the senior on a budget. The lower-income beneficiary, it would be a huge upgrade for them.

Promoting Generic Drugs

Yep. And one of the things Trump had proposed in his presidency and going forward is, like we were talking about that the generics are so much cheaper, he really wants to make a push for more generics, which he thinks would also allow for about $22 billion in savings.

Yeah, to me, this speaks of an idea that's practical, and we have the infrastructure set up to actually do that. I think that is a bet that actually makes a lot of sense given our distribution channels, given the fairly rigorous quality assurance that we have in the United States to make sure that these generics as well as so-called biosimilars are in fact safe. And that's just an opportunity I think that we have to continue to pursue where the US has had great success. You mentioned that earlier relative to other countries, we already do bring generics to market substantially faster than some of those other economies.

The Stark Law and Administrative Interpretations

Exactly, exactly. And one of the criticisms in the Harris administration from people like us, other oncologists, is her interpretation of the Stark Law.

So the Stark Law... Yes, I'm glad you brought this up. I forgot about that.

Yeah, so the Stark Law pretty much prevents self-referral. So if a surgeon owns a radiation machine, they can't just refer the patients for radiation treatments and pocket the money. Right. That's what it's meant to prevent. But they interpreted it to also include caregivers being able to pick up medicines for individuals from the pharmacy and mailing out prescriptions and not allowing for that.

I have to admit that this has to be some kind of confusion, some kind of bizarre... When you brought this up to me earlier, it piqued my interest greatly and I honestly have to research, get to the head of the snake, as it were, as to how we could get to that point with Stark Law.

Yeah, I think a lot of it's just bureaucracy interpretation of the law. And so there is legislation to hopefully amend some of that, and the Community Oncology Alliance, amongst other organizations, are trying to push for some of that. So anything else you want to talk about with drugs right now? Do you think we hit it all?

The Affordable Care Act (ACA)

I'm looking at my notes here and I'm dying to get your thoughts on the different approaches to healthcare access. And by that I'm really talking about, we got this baseline situation now, which is the Affordable Care Act as it exists in 2024 and everything it does. Right, which used to be known as Obamacare. So yes. And before that, Romneycare. And before that the Swiss approach. Right, exactly.

So to go really far back on this one. So this is where the commonalities end. Essentially the candidates are diametrically opposed. You've got Trump. I mean, this is not going to be a surprise to anybody, Trump who seeks to roll back... I mean, how many times did he try already to repeal Obamacare in his first term? Right. So he's going to probably pick up right where he left off as he is saying on the campaign trail.

And it's interesting that you brought up how it's switched back and forth this concept of the Affordable Care Act. So I'm dating myself, but when I was in college I did a thesis on the Swiss model. And back then it was the Republicans and a lot of the conservative think tanks that picked it up because the idea of requiring somebody to have coverage prevents freeloading in the system, so charges individual responsibility. These are all very strong Republican themes, and which is why it was picked up by Romney and major insurers like Aetna and everything at the time because it penalized young people who were just freeloading off the system. And so by bringing those young people in who are generally healthier, everybody else's premiums would be reduced, lowered the risk of the entire pool of insured people.

So it's interesting that once it got passed, Trump and the Republicans actually voted to repeal the individual mandate, which is the penalty, the tax penalty for individuals who don't opt in, which are usually the healthier 20-somethings.

Right. That aspect you remind me. And you're a D.C. guy, you live in D.C. and you're well versed in all this. And so for someone in D.C. it's a higher probability you'll remember it correctly than me. Did the individual mandate piece make it all the way to the Supreme Court? And the Supreme Court said we're upholding the law, but the individual mandate...

Exactly. You're 100% right. John Roberts, and he was the tie-breaking. So it was a 5-4 ruling with John Roberts writing the opinion saying that it can be upheld because it's a tax. And so it was upheld through a tax law, but it wasn't popular.

You remember this dynamic. I mean, because so much stuff has happened since. Yeah. But it wasn't popular. And so even though it helped reduce premiums overall in the program, it was repealed. So that was one of the things he repealed. And just to put perspective for our viewers, the program right now funds about 20% of insured patients, 90 million patients, about $800 billion program is the Affordable Care Act. So this is not a small... this is a huge program we're talking about.

And yes, and she, Ms. Harris, she wishes to increase the subsidies on the framework of the ACA. Right. Take that framework, increase the amount of subsidies that are paid for insurance purchases. And she wishes to also—I think I have this percentage remembered correctly for the premium payments—cap them at 8.5% of household income. Is that right?

Yep, exactly. So pretty much once again, expanding coverage, which supposedly the estimates are, would increase the enrollees by almost 20 million, 20 to 23 million new enrollees, but would come at another cost of 200 billion over 10 years. You're seeing a pattern.

Okay, since you brought out the numbers... And I love that because it makes it real. So the previous initiative, 450 billion, was her prescription drug plan. Right?

Right.

The estimate is 450 billion in 10 years. The increase in the subsidies for purchasing of insurance for let's say low and middle-income individuals, that's another 200 billion. Right. So we're at a 650 billion price tag at the moment. Let's say. Yeah, this is good. Let's keep with this as we're going. I like it.

So some of the other things that Trump did because he couldn't repeal the ACA... so he dropped the individual mandate, he also allowed for these skinny plans. So people don't have to have such expensive premiums, but then they don't get the full coverage; they don't have mental health, they don't have maternal coverages, and they can have some of those policies for up to a year under him. So he expanded some of these subpar insurance plans for consumers.

Yes. And are these the same plans when people refer to catastrophic coverage, these so-called short-term health plans? I think, but I have to admit, I'm not sure. I'm not 100% sure of that either.

Yeah, so something was loose with the jargon there. Check. But yeah, I mean, he's making attempts to pretty much save the government money, repeal some of the things from Obamacare. But the one thing nobody's going to touch and not willing to touch because it's so popular is the coverage for pre-existing conditions. That was one of the most popular things that came out of the ACA is that if you had a pre-existing condition prior to that, an insurance company could choose not to cover you or you may not have health insurance.

Isn't that unbelievable? Like if you think back to the way that was, and I remember in the period of let's say 2008, 2009, as we were ramping up to these various versions of the ACA, how that was normal then. That if you had, I don't know, an autoimmune condition that was expensive to care for...

Oh yep.

Yeah, you're not getting insurance, or cancer. Right. In our world. Right.

Medicaid Expansion and Block Grants

So yeah, that was probably one of the best things to come of it and obviously increasing coverage. But one of the other interesting things about the ACA was his expanded Medicaid. And it expanded Medicaid across many states because it allowed for the government to match up to 90% of funds for states who opted into the Medicaid expansion, which allowed pretty much that if you were up to 138% of the poverty level, more of those individuals can now be part of Medicaid. And so a lot of states saw a potential way to get money into the state to cover their vulnerable citizens. And so it expanded to about 41 states now, expansion Medicaid.

And now, we're sort of lurching towards my main policy interests and that is the functioning of Medicare, the functioning of Medicaid, how these programs actually work. And what you're talking about here is that the way that Medicaid functions in this country is it is a state-run program. It varies by US state, ultimately backed by the federal government where the federal government pays a percentage of the overall Medicaid spend that occurs in the states.

Right.

And on Ms. Harris's side, she wishes to keep the program going in its current form and I believe increase the share that she is backing. Whereas Mr. Trump, on the other hand, wishes to actually go all the way to the other side, which is block grants. Right? Yeah. Talk a little bit more about block grants I think for some of the viewers.

So for the block grant approach, the federal government would pay a dollar amount, there would be essentially a ceiling, and that dollar amount would be paid to each state. And if those funds became exhausted by the expenditures in the year, that's it. There's no more. Right. And the crazy thing is we were talking about adding up some of the new costs for some of the plans on the Harris side—we talked about 200 billion for one thing, 450 billion for another. The CBO estimate for Mr. Trump's approach to Medicaid is a $900 billion savings over 10 years.

Correct. At a cost, though, of about 17 million individuals losing their insurance. That's right. And I'm glad you brought that up because a lot of times with finance, the cost that you see and feel drives the argument here. But there would be enormous unseen costs. To make another parallel, forgetting healthcare for a second, but Mr. Trump has a certain obsession with tariffs, and tariffs is a massive unseen tax, potentially more than any kind of tax cut that Kamala Harris would propose. So we have to be transparent.

And going back to what you were saying about how expensive these are for the states, it's actually, on average, the second highest expense for states after education programs. It represents 29% of states' expenditures on Medicaid.

I'm impressed how well versed you are on the Medicaid program. Very impressed.

Proposed Changes to Medicare

But let's talk a little bit about Medicare. So one of the things Harris wants to do is to potentially reduce the age on Medicare from 65 to 60. I'm already thinking about the price once again. Let's take a guess again how much that would cost. I'm going to guess in the neighborhood of 200, 250 billion for that one also.

Yeah. Ding, ding, ding. 200 billion over 10 years again. So that's another 200 billion. But it would expand coverage to another 23 million Americans who are likely uninsured in that age bracket and who aren't meeting the income thresholds for Medicaid. Yes.

And by the way, just for the benefit of anybody listening to this episode, this is not something Matthew and I are doing here in real time. These estimates come from the CBO, and the estimate on the Medicare age change from 65 down to 60, and the 200 billion there, actually comes from the Committee for a Responsible Federal Budget.

Right. And some other numbers of ours have come from the Kaiser Family Foundation as well. So these aren't stuff we're spitballing off the top of our head. No, these are fairly trusted, high-quality outfits that analyze these programs right across. And so one of the ways that Harris explains how she's going to pay for a lot of this is by rolling back some of the tax cuts that were in Trump's 2017 legislation, which allowed for tax cuts to higher-income individuals and corporations. So by rolling some of that back, she says higher-income earners and corporations should be funding healthcare in this country. That's kind of what she's proposing here.

Yes. And I'll readily admit I do not know what is the size of that nut, as it were. What are the funds available by reversing that? And that's something we'll have to add into the show notes.

Right, exactly. And some of the other things that she's proposing is home health care, which is also apparently the estimate is about $40 billion per year.

40 billion per year.

Per year. But would allow seniors in the Medicare program to have access to home health care without having to have other coexisting conditions to require it.

Risk Stratification and Preventative Care

You know what I haven't seen any talk about by either candidate—but certainly there's the subject matter experts and the advisors to the campaigns and associated entities that the government seeks counsel from—is rather than blanket, across-the-board new programs, why don't we get sophisticated about risk-stratifying the patients? So coming up with validated national metrics to say, okay, who is a patient who is likely to injure themselves, to need repeated ED presentations, to get admitted to the hospital in a high-frequency way? And who are the patients who have conditions that are so-called rising risk? Focus our care navigation and care management efforts nationally on those individuals, and money spent there—like educating children—produces substantial dividends down the line. I haven't seen it talked about anywhere.

No, but interesting. What's interesting about what you mentioned... So J.D. Vance has spoken a little bit about readjusting risk, which would potentially mean healthier people would pay less premiums with the risk adjustment and sicker people would pay more. So he has talked about some of that in his last debate. So that's interesting.

Yeah. From my perspective, it's a little bit hard to imagine that a federal program like Medicare is going to cost one beneficiary who maybe is sicker more money than, I don't know, someone who's out there. But reasonable people could disagree on that, I suppose.

Patent Reform and March-In Rights

Yeah. And some other things where it just made me think when you were talking about this that we didn't mention, where they both kind of agree on Harris and Trump is in relations to patents, which kind of goes back to the drug discussion a little bit. But they both feel strongly that there has to be some restrictions and limits on patents, whether it's through the Hatch-Waxman Act or Harris is talking about a march-in. So in other words, if drug companies are funding some of their R&D and their drugs by some money from the federal government, that the federal government can claim that they can take that patent sooner rather than the normal length of time. Right.

Yeah. And the time acceleration is pretty substantial. I don't have it at my fingertips, but I think it's something like a third faster.

Oh, wow. Okay.

Yeah, and once again, that would allow things to go to generic sooner. Right. Which would save big time money, huge savings.

Medical Debt Forgiveness

And for adding up costs, another thing that Harris... Yes, let's keep going. Proposed in one of her media interviews was waiving $7 billion in medical debt for Americans.

So this would be medical debt that exists already.

Exactly, yes.

Okay, got it. Sort of in the vein of the student debt plans that have had mixed success because some of them have been deemed unconstitutional. Interesting. So you said 7 billion for that one. So we basically got about three things that are about 200 billion a pop. Another plan that's about 450, and then that 7 is just a rounding error essentially.

Yeah, somewhere in that realm. But like she claims, it's going to come from revisions to the tax code. So to be determined. And then I think shifting to one of our other topics is maternal health.

Maternal Health Policies

Yes. Trump under his presidency did expand maternal benefits, maternal leave, paternal leave for federal employees for up to 12 weeks during his time. He wasn't able to drive it into the private market, but just for federal employees. And it doesn't include caregivers or other people.

Right. So Harris is looking to expand that.

Yes. I was just going to say I think some people might be surprised to know that he did that, and he did it by executive order.

Exactly. Because it's easy to do. It involves federal entities. He has that purview. So what Harris is looking to do is expand that further to also include individuals who are taking care of people who are sick. And because one of the interesting things I learned when I was doing research for this episode is maternal mortality in this country is number one out of 14 high-income countries in the world. And particularly for black women is much higher, three times as high compared to white women.

So that's gotta be the group of the so-called OECD, the Organization for Economically Developed Countries. And we're the worst. That's sad to say the least.

And yes. So for the folks who may go and have a look at her platform, I believe this would be listed under the Maternal CARE Act, which is a part of her platform which seeks to reduce maternal mortality rates. Right. And her track record with that is under Medicaid since 2022, the expansion of postpartum coverage under Medicaid went from three states to 47 states offering coverage. So there's a track record behind her there.

So it's interesting. One thing I think that close political observers will mention about a question that she gets asked a lot is about accomplishments in her time as vice president. And sometimes it's a question she has difficulty answering. But I mean, what could be more important than that? I mean, I think that should be at the front of the answer every time. Maybe clips from this will be played on both campaigns. We can only hope. Could you imagine? But so I think that's a great accomplishment.

Summary of Candidate Approaches

Yeah. We probably want to wrap up. What do you think? How do you summarize all this?

I would summarize this as on the Harris side, it's certainly a wish list, a very predictable wish list of programs and expansions of programs that I do think would enhance the quality of life for those Americans who would qualify them, at a very high cost. At a high cost that I don't know if a plurality of Americans are willing to pay. That's the question. On the Trump side, similarly predictable, a kind of deconstructionist view on a lot of these programs that have achieved a certain level of popularity. So even Mr. Trump is on what I would consider some shaky ground with some of the stuff he wants to do, but attractive if you are on the side of fiscal conservativeness because there's big savings to be had through some of the things that he seeks to do.

And I think one of the other things is that Harris, whether these are going to be fundable or not, she does have a list of proposals. While Trump, as we remember in his last debate, has concepts of a plan.

That's a great way to put it. In fact, I meant to bring that up earlier, is that he is not a details guy. He's not the COO. Right. He's a CEO through and through. And he leaves it to his... He claims potentially Kennedy may play a role in his administration on the healthcare side.

Wow. Okay. I mean, the times that we're in, no one would have predicted it, that we would have a Kennedy on the Trump side and that we would have the Cheneys. Right, exactly. It's a bizarro world. Weird times we're living in.

So, all right, this has been exciting. This has been fun. Hopefully I didn't drag you too much into the weeds in politics. And next time we can stick to more economic topics.

This is great. And certainly, as you say, extremely, extremely timely. And I wonder, I think you may have said at the beginning, could anyone predict what side either of us is on? And after this conversation, I don't know. We'll see. We'll see what people say in the comments. Predict who you vote for.

Well, we look forward to reading that. All right, well, thank you. And we'll see you all in a couple weeks. See you next time.