AP Photo/Mark Schiefelbein
At long last, President Trump is poised to slash government spending and aggressive regulations — and advance his first-term health-spending policies that were obstructed by Congress or overturned by the Biden administration.
That’s a big reason why Trump created the now-famous Department of Government Efficiency. The goal: identify and weed out inefficient and counterproductive government spending.
Reform could not come soon enough. Health-care costs, in particular, are ballooning the federal deficit and hindering economic growth.
DOGE won’t make much progress without lowering the rampant costs of the US health-care system, because an astounding 48% of federal expenditures are devoted to health-care outlays.
And it’s going to get worse: Federal health spending is projected to surge from 2023’s $2.2 trillion to $3.8 trillion in 2032, making up a staggering 20% of the nation’s GDP.
Yet much of this spending is avoidable.
Some experts estimate that 30% or more of it amounts to waste, overcharging and in some cases fraud. This stunts economic growth and destroys incentives for health-care competition and high-quality, low-cost care.
The huge discrepancies in charged costs for medical procedures, consultations and treatments, combined with convoluted insurance claims and invoices, leave patients confused and unable to make well-informed health-care decisions.
Additionally, lack of price transparency allows hospitals and health-care providers to institute massive markups on medical services — on average, up to 7 times the actual cost of care.
These concerns can be mitigated through fostering a culture of transparency, efficiency and competition in the health-care sphere.
To do this, the new administration must emphasize disclosure of actual health-care prices — a basic prerequisite for any competitive marketplace that will inevitably put downward pressure on costs and eliminate inefficiency.
Increased transparency in health-care prices, bills and claims would reduce federal spending by nearly $1 trillion a year, according to some estimates.
It’s a staggering amount, but it’s in line with multiple peer-reviewed studies that have found massive amounts of “administrative waste, errors, overcharging, and fraud” in the system.
Because health-care price transparency would incentivize accountability, efficiency and competition among hospitals and care providers, that $1 trillion in reckless overspending could be saved and injected back into the economy each year.
That would bring our costs down to near what the Europeans spend — without reducing health access, as we’d experience in a Europe-style socialized medicine system.
At a higher level, price transparency will bolster free enterprise in the United States, redirecting spending away from the bloated medical-industrial complex, cutting out inflationary middlemen and increasing innovation and competition.
This philosophy of transparency as a lever to push lower prices and higher-quality care is one that Trump prioritized during his first term.
In addition to signing executive orders on health-care price transparency and improved quality and efficiency of care, Trump laid the groundwork via congressional and agency policies, including the 2019 Hospital Price Transparency Rule.
Unfortunately, the Biden administration repealed many of Trump’s regulations, including the requirement that hospitals publish all actual prices — and refused to enforce the transparency rules.
But now, with a united Congress behind him and DOGE committed to bringing more efficiency to our government, Trump has the rare opportunity to restore and advance his first-term transparency policies.
Now he can take action to encourage health-care establishments to both decrease prices and increase quality through healthy competition and consumer choice.
We hope, too, that Trump will make consumers more health-cost-conscious by expanding health savings accounts and high-deductible insurance policies so that patients have an incentive to shop around and find the lowest-cost alternatives.
Trump’s mission must include putting American patients first and draining extraneous costs from the health care complex.
Demanding price transparency is an essential step in reforming the American health-care behemoth, stimulating the economy and cultivating an efficient, responsible government.
Steve Forbes is chairman and CEO of Forbes Media. Steve Moore is co-founder of the Committee to Unleash Prosperity.