It's not Trump who the Democrats have to fear in the 2020 fight over healthcare — it's big pharma

Even Donald Trump has taken aim at sky-high prescription medication costs -- so what is it about Medicare-for-all that has powerful pharmaceutical, hospital, and health insurance lobbies running scared?

Bernie Sanders was the one who introduced the Medicare for all bill in the Senate, with a number of Democratic co-sponsors (EPA)

For the second consecutive presidential election cycle, the question of whether to retain the Affordable Care Act (commonly known as Obamacare) or scrap it in favor of something else entirely threatens to take centre-stage.

Unlike in 2016, however, which pitted Hillary Clinton’s pro-Obamacare stance against Donald Trump’s “repeal and replace” campaign pledge, and prior to that saw Hillary and Bernie Sanders engage in heated debate over what a progressive vision for healthcare in America should look like in the future, the 2020 version of this debate will bring on insurers, hospitals, pharmaceutical companies, and other healthcare professionals as main participants.

In other words, on the horizon is not so much an ideological scrap between candidates looking to steer a political party in a particular direction but a battle between politicians and industry, between presidential hopefuls and the insurance and drug lobbies.

In September, Sanders introduced a Medicare-for-all bill in the Senate, pulling in a number of Democratic presidential aspirants as co-sponsors, including Elizabeth Warren, Cory Booker, Kirsten Gillibrand, and Kamala Harris. The House, now under Democratic control, is re-engineering an existing Medicare-for-all bill to be sponsored by Congressional Progressive Caucus co-chair Pramila Jayapal. These are by no means the only versions put out there—the term “Medicare-for-all,” like “Green New Deal,” evokes a legislative aspiration more than it does a single, concrete proposal—yet they are likely to be the packages the healthcare industry will most worry about.

The Partnership for America’s Health Care Future, an organisation comprising “the nation’s leading doctors, clinicians, community hospitals, health insurance providers, and biopharmaceutical companies,” formed last summer to combat rising openness to expanding Medicare. Sensing an existential threat to America’s current healthcare superstructure, the group has sought to counter-message the very proposals that most of the major 2020 hopefuls on the Democratic side have now embraced. A leaked strategy memo from last year revealed one of the group’s key interests is keeping Medicare-for-all from officially becoming a plank in the Democratic Party’s 2020 platform.

What is it about Medicare-for-all that has powerful pharmaceutical, hospital, and health insurance lobbies running scared? Well, for starters, big pharma is obviously troubled by a proposal that would eat into its profit margin—both the Sanders Senate bill and the prior iteration of the House bill that is set to be reintroduced would require the government to negotiate prices with drug manufacturers.

The hospital lobby, for its part, wants nothing to do with a public option policy; in fact, it only backed Obamacare when that option was safely removed from consideration during drafting. The American Hospital Association put out a press release just last month reporting that, in 2017, “66 per cent of hospitals received Medicare payments less than cost.” Health insurers also fear a dramatic upheaval to the industry, which would reduce and — if a true single-payer system is eventually embraced — all but eliminate the role of insurance companies within the American healthcare system.

During the 2016 Democratic primary debates, Sanders was widely interpreted as pushing for a system that would ultimately extricate healthcare from its reliance on market operations—even if the early phase of the vision kept a role for insurers, the full realisation of a single-payer system would seek to crowd out private insurance.

An interesting variable in all this is President Trump’s willingness to tackle the problem of “soaring drug prices.” Late last month, the administration unveiled a proposal that would reduce out-of-pocket drug costs by shifting rebate benefits from pharmacy managers to consumers directly. Think of it this way: instead of CVS or Walgreens getting the discount, you would.

Pharmacy benefit managers claim the discounts pass through to the consumers already, but Trump’s secretary of health and human services, Alex M Azar II, expects the White House’s initiative to dramatically lower drug costs for patients.

To illustrate the interesting moment we find ourselves in with all this, a few days ago Trump held a rally in which socialism was trotted out for particular ridicule, while just last month, Bernie Sanders, famously in favor of socialist policies, introduced The Prescription Drug Price Relief Act of 2019, a measure in many ways consistent with Trump’s rhetoric about irresponsibly high drug costs.

Trump and the GOP remain steadfastly opposed to Medicare-for-all, and in fact are chomping at the bit to use widespread Democratic embrace of it as an electoral argument against them. But the most significant battle on this front in 2020 is gearing up to be the Democratic candidates for president against an industry committed to keeping the status quo.

Berny Belvedere is the editor-in-chief of Arc Digital, as well as a contributor to the Washington Post, Buzzfeed and the National Review