As legislatures ramp up across America, states are seeing new attempts to help expand access and decrease the cost of health care for Americans.
Lowering the actual cost of health care — specifically prescription drug costs — requires an overarching look at the system patients use to obtain medicine. Waving a simple magic wand and enacting price controls won't solve the problem. In fact, it creates new problems for patients whose cures still need to arrive on the market.
As the nation's oldest taxpayer advocacy organization, National Taxpayers Union stands firmly on the side of taxpayers and patients as we look at reducing the costs taxpayers and patients pay for health care.
State legislators have already introduced a bill in North Dakota that creates a pilot program seeking to lower the prices of high-cost drugs in state-regulated health plans. NTU has voiced concerns about previous versions of this bill because the general enforcement mechanism of price setting will, unfortunately, backfire and create unintended consequences of lower access and reduced innovation in the prescription drug market. As a September 2019 study by the Information Technology & Innovation Foundation finds, "it is simply not true that government can impose significant price controls without damaging the chances for future cures."
North Dakota Senate Bill 2031 will further endanger access to lifesaving treatment for North Dakotans who need newly innovated pharmaceutical solutions to their health care problems. The cost of bringing a prescription drug to market is expensive. North Dakota patients shouldn’t let the Canadian government’s drug pricing system become their own and hinder the availability of the latest medications they need.
The current version of this bill also attempts to penalize companies that might pull their drugs from the state because of the proposed price-control schedule based on Canadian drug prices. Beyond the question of enforceability, the inclusion of this provision itself acknowledges that prescription drug access will diminish under a system where the government sets prices.
A recent December 2022 report from North Dakota State University’s Dr. Raymond March concludes, “Thousands of examples and a large body of research consistently find price controls fail to deliver while causing considerable harm. Implementing them in North Dakota would be a disastrous misdiagnosis.” He’s right.
National Taxpayers Union stands ready to assist state lawmakers as they pursue a holistic and thorough look at how to find cost-saving measures for patients and increase competition for health care. However, the unintended consequences of this North Dakota bill need to be considered, and it should not pass.