Prescription drug prices fell 3.1% over the past year, the sharpest annual decline in more than six decades, according to new data from the federal Bureau of Labor Statistics. Hospital prices, meanwhile, rose 5.2%.
Yet the vast majority of Washington policymakers focus their time and attention on reducing drug prices, not hospital costs.
It’s easy to see why. Just like “Big Tobacco” in the 90s, “Big Pharma” has become a boogeyman in both parties. As research has shown, tobacco kills and drugs save lives. By contrast, voters tend to look favorably on their local hospitals.
But if lawmakers want to actually bring down healthcare costs, they’ll need to take on the hospital conglomerates that are disproportionately driving medical inflation. That won’t require statist price controls. But it will require redoubling efforts to cut red tape, boost transparency and promote the market competition that leads to lower prices.
