Remarks at a Roundtable Discussion on Health Care Costs and an Exchange With Reporters

The President. Thank you all for being here. I especially want to thank Secretary Azar and Secretary Acosta—they're doing a fantastic job—for everything they're doing with respect to health care and more affordable health care at that, for the American people. It's incredible some of the things we've come up with that are much less expensive than Obamacare and, in many respects, are much, much better. People have to know about the options. We have a lot of options, and people have to know that.

We're here today, though, to discuss how the health care system too often harms people with unfair surprises. They have some really—surprises in a very negative sense: medical bills and the like. The pricing is hurting patients, and we've stopped a lot of it, and we're going to stop all of it. And it's very important to me.

My administration is committed to delivering a health care system that takes care of American people—of the American people and like they haven't been taken care of before. And we can do that. It's a very difficult subject, it's a very complex subject, but we've all gotten to understand it very well. And the strides we've made are rather amazing.

We want to take advantage of those strides now, and we want to let them be known to the American people, as we make additional headway. We've already made that progress. In certain way, we're lowering, and we will continue to lower, health care costs. We approved a record number of generic drugs over the past 2 years. If you look at what we've done—and we're going to be putting out a list at the end of the week—the number of generic drugs, which brings down the pricing. They're just as good as the name drug. In fact, one of things that amazed me—I was asking a few of the people, including Scott—I was saying that, "What's the difference between the generic and a big-name drug where you pay much more money?" And they said, "Absolutely no difference." Do you still agree with that? I mean, Secretary, do you still, I mean——

Secretary of Health and Human Services Alex M. Azar II. Absolutely.

The President. So somebody is going to have to explain, why are they paying for the brand? Will somebody explain that please? Because they literally say there's absolutely no difference. Identical. And you'll pay four, five, six times more money for something that comes in a container that you're more familiar with. So we've expanded that greatly, a lot of generic drugs.

Through the association health plans—thank you, Secretary Acosta—we've expanded access to affordable, high-quality health care, particularly for employees of small businesses and self-employed individuals. And we reduced average premiums on the Federal Obamacare exchanges for the first time in the history of the horrible Obamacare. Okay? It's the first time it's ever happened.

We're working very hard to get those—the pricing down, as we really do things that are going to make it much better, and ultimately, it will result probably in a court case termination, and then we'll all get together, and we'll come up with real health care. As the result of our efforts, prescription drug prices have declined in 2018 for the first time in over 50 years. So prescription drug pricing has been very important to me. Think of that statement: For the first time in over 50 years, it's gone down in pricing. Is that a correct statement?

Secretary Azar. That's correct.

The President. Because if it's not, you know, they're going to get us. Okay? [Laughter] We'll be looking very strongly, so we have to realize that that's a very powerful statement. First time in over 50 years that prescription drug prices have declined, that's in 2018.

But the seen and unseen costs of health care are still taking an enormous toll on millions of American families. And this is something that I inherited; unfortunately, you inherited it also; the people inherited it. And we're doing a lot about it.

Half of all unpaid bills on consumer credit reports in America are for medical bills. One-fifth of credit reports include a past-due medical bill. And you think of so many other bills, but one-fifth—a big portion of what people are having trouble with right now—are medical bills, and we're doing a lot about that.

Nearly 40 percent of insured adults report receiving a surprise medical bill in the last year. Patients should know that the real price—and what's going on with the real prices of procedures, because they don't know. They go in, they have a procedure, and then all of a sudden, they can't afford it. They had no idea it was so bad—of procedures, treatments, and medicines before they receive them. And this is a big shock to a lot of people, patients and others.

When you go to a grocery store, or you go to see a mechanic, you know the prices up front, and you get a receipt that shows the cost of every item. Every single item. You know exactly what you're paying. You go and get your car fixed, and you say, "How much?" But people don't do that with the medical to the same extent, and they get some very unpleasant surprises.

And one of the things that happens is, when you don't make a deal up front, then the doctor, or whoever it may it be, all of a sudden doubles and triples the price, because they figure you don't care or you're rich—you have plenty of money; you don't have to worry about it. And we don't want that happening.

That's what we want to do with health care so that patients will know exactly what the cost is, what the quality is. And just think of it as a consumer. You're really a consumer at a very high level, and you can get some great health care. We have some plans that are great. But you have to go in and price them.

So I'd like to hear about some of the experiences of the people around the table. We've had some incredible experiences, some really eye-opening experiences, and we're going to hear that. But before we begin, maybe I'll ask Secretary Acosta to say a few words and follow it up.

Mr. Secretary, please. Okay? Thank you.

Secretary of Labor R. Alexander Acosta. Mr. President, thank you. You mentioned association health plans, and I wanted to take this opportunity to update you on some of the preliminary results.

The President. Okay. Secretary Acosta. You asked us, you ordered us, to look at these, to make them available or possible. And so far, we've had about 30 association health plans across the Nation. We've had two that have gone across multiple States. And I wanted to highlight one in particular. An early adopter was the Las Vegas Metro Chamber of Commerce. And so they had had an association health plan in the past, and so far—they're still processing—but they've had more than 500 employers and 100 sole proprietors sign up for this plan.

The President. That's great.

Secretary Acosta. The plan provides quality. It's providing substantial cost savings. For example, a small business that—where employees used to be paying about $400, $450 per month for health care are now on average paying $230 per month. So a 40-percent reduction. And it's quality. It provides a 2-year rate lock. It provides and covers preexisting conditions. Dental and vision are available. Health savings accounts are available. And this is the kind of quality that we're seeing in these plans across the Nation.

The President. And enough people don't know about it.

Secretary Acosta. And people do not know about it, but you're seeing chambers of commerce from Massachusetts to Vermont to Nevada. You've seen the American Veterinary Association that just started a nationwide association health plan; Land of Lakes that is starting a multi-State health plan for farmers. And so as these are commencing, you're seeing incredible cost savings, and you're going to see many, many more of these.

The President. And better health care.

Secretary Acosta. And better health care.

The President. So you get better health care, much better health care at a lesser cost. So, you know, people just have to know about it. And it's available now. And are you doing the 401? Or what are you doing with that?

Secretary Acosta. So we're also taking the concept of an association health plan and extending it to an association retirement plan where, right now, 14 percent of small businesses—and only 14 percent—offer retirement savings to their employees. We wrote a rule—it's been out for notice and comment—that would extend the association concept so that these same organizations, whether a chamber of commerce or the American Veterinary Association, can offer 401(k) plans.

So instead of every small business having a separate 401(k), you can have large, centralized 401(k) plans. And not only does this eliminate paperwork, not only does it allow more employees to access retirement savings, but a small 401(k)'s fees are much larger than a large 401(k). And so you're looking at about a 1-percent fee saving per year with these association retirement plans.

The President. Right.

Secretary Acosta. One percent over a lifetime is incredibly meaningful to all of these employees.

The President. Right.

Secretary Acosta. And then, finally, we're working on the reimbursement accounts—the health reimbursement arrangements—where employers can give their employees cash. So those employees can go out and they can buy their own health care. It provides more options. It provides more flexibility. And that's one project that I'm working with Secretary Azar on. It's out for notice and comment as well. And we're very excited about the possibilities.

The President. When will you have all of your various plans out, would you say?

Secretary Acosta. And so they're both out for notice and comment. And I would expect certainly the association retirement plans by spring.

The President. Good. Okay, great. Thank you. Great job.

Mr. Secretary.

Secretary Azar. Well, thank you, Mr. President, for welcoming us here today to discuss this really, very important topic. Like all of the Trump administration, HHS knows the right way to bring down costs while improving quality in any area is to empower consumers and to employ market forces.

This can't be accomplished without transparent pricing information. It's got to be meaningful price signals. But in health care, prices are often hidden, far out of line with what many patients will owe, or both.

Making prices more transparent can protect patients from the kinds of awful stories that we're going to hear about today and bring down costs for everybody in both health care services and prescription drugs. People should have the right to know what a service or a drug will cost them before they have to buy that service or drug.

One key area is health care services. We've already started bringing transparency to hospital prices. Starting on January the 1st, hospitals are now required for the first time to post their list of sticker prices online in a machine-readable format, which is a historic first step in much bigger efforts around transparency. The data has to be machine readable so that patients can use private sector solutions, like apps, that can help them understand this data.

Ultimately, patients should know a service's price and the price that they're going to really pay—the out-of-pocket—before they agree to that service. Delivering that is a complex challenge, which we—and we put out multiple requests for information on how to make that a reality.

And this is a problem not just for the folks who are visiting us from around the table. None of us are immune, myself included. Several years ago, my doctor wanted me to get a relatively routine diagnostic test. He then sent me within his complex, from his office, over to the hospital unit of this facility, where—because I had a high-deductible plan—I asked how much it would cost. Do you know what I was told? "We can't tell you." Well, because I was a former Deputy Secretary of HHS—[laughter]—I pushed and pushed, and I didn't—and I said, "You're going to tell me what this is going to cost." And eventually, they told me: $5,500.

Well, I went on my phone, and I quickly checked a very reliable health care site run by an insurance plan and said, "If this very basic diagnostic were done in a doctor's office—in the doctor's office, not in the hospital—it should cost $550." And I said: "Okay, so $5,500. How much with my insurance company is the negotiated discount? What will I pay given my insurance company." "We can't tell you." "What do you mean you can't tell me?" And I fought and fought and fought. And eventually, they told me. "$3,500." So, armed with that information, I took the plastic wristband off and walked out of the facility and didn't get the test done. [Laughter] But we have a right to know this information. We have a right to be demanding customers, because if that happens, we have a right to take that plastic wristband off and walk out of that facility and not get a surprise bill when we get home, months later. Many individuals, like the horrific stories we're going to hear today, who cannot afford those types of bills.

And we know that employers and insurers who pair price transparency with incentives have driven costs down. This works. In one study, costs for imaging—like what I was going to have—were driven down almost 20 percent while price disparities across providers also narrowed.

Another key area that the President mentioned for transparency is around prescription drugs. And the President has put forth the first-ever proposal to require disclosing the list prices of drugs in TV ads. Many patients pay based on their prices in deductibles or coinsurance, based off of the list price of these drugs. And they've got a right to know that information.

And earlier this year, the President put out a regulation and then signed legislation banning gag clauses that prevent your pharmacist from telling you if you can get a drug at a lower cost by simply paying out of pocket for that drug than by using your insurance.

One study suggested that 23 percent of patients are paying more in copays than—at the pharmacy than they would if they simply paid in cash. And the President and Congress delivered that relief and transparency to America's patients.

We also are concerned about the issue of rebates. And, Mr. President, you asked about the issue of "Why would anyone ever take a branded drug when there is a generic available?" One of the most common reasons is because a pharmacy benefit manager is getting a rebate payment from that branded company to steer you to use the branded drug, rather than the much, much, much lower cost generic.

We're concerned that patients and payers are left in the dark about the hundreds of billions of dollars in rebates being paid from drug manufacturers to pharmacy benefit managers or so-called middlemen. These payments are nontransparent, and they distort these prices and create bad incentives in our system.

Marty Makary, whom we have here today, has done remarkable work showing how neither patients nor employers who pay for insurance know what's going on with these rebates and prices. Bringing down prices in health care, as this President has promised to do, ultimately has to involve in making sure everybody knows and understands these prices, they're transparent, and they're available.

Thank you very much, Mr. President.

The President. Well, thank you very much. And thanks for the great job. And remember, as we get ready to leave the media, prescription drug prices in 2018 went down for the first time in over 50 years. And that's not by accident; that's because we did a lot of hard work, and it's going to continue to go down. And we're finally getting drug prices down for the American people.

And this was a one-way street up. And now, for the first time in over 50 years, prescription drug prices have gone down. So we're very proud of that. Thank you very much. I appreciate it.

Venezuela Q. Mr. President, you made an announcement about Venezuela today. Some administration officials told reporters in a conference call that all options are on the table. Are you considering a military option for Venezuela?

The President. We're not considering anything, but all options are on the table.

Q. Does that mean you're considering a military——

The President. We're just—all options, always. All options are on the table.

State of the Union Address/Democratic Party/Border Security

Q. Mr. President, Nancy Pelosi just responded, and she said she will not consider a concurrent resolution to have you come to the House on January 29 to deliver your State of the Union. Your response to the House Speaker?

The President. I'm not surprised. It's really a shame what's happening with the Democrats. They've become radicalized. They don't want to see crime stopped, which we can very easily do on the southern border. And it really is a shame what's happening with the Democrats.

This will go on for a while. Ultimately, the American people will have their way, because they want to see no crime, they want to see what we're doing, like today we lowered prescription drug prices, the first time in 50 years. They want to see that. The Democrats would never have been able to do that.

So we're all working very hard. We'll have to respond to it. We'll respond to it in a timely manner.

Thank you very much, everybody. Thank you.

China-U.S. Trade

Q. How likely are you to get a deal with the Chinese next week? How likely are you to get a deal with the Chinese next week?

The President. China very much wants to make a deal. We'll see what happens. I like where we are right now. We're doing great as an economy. They're not doing very well, because of the tariffs.

But as you know, fairly soon, that—the deal that I made with them will come off. The tariffs will be substantially increased on China. They're paying billions of dollars to the United States Treasury. First time we've ever done that. First time we've ever had money coming the other way from China. It's always been a one-way street. But I have a very good relationship with President Xi, and we'll see what happens. But we're doing very well in our negotiation with China.

One way or the other, it doesn't matter—one way or the other, we're going to do well.

Former Personal Attorney to the President Michael D. Cohen

Q. The story from Michael Cohen delaying his testimony—he says he's been threatened by you and Mr. Giuliani. He and his family have been threatened. What's your——

The President. No, I would say he's been threatened by the truth. He's only been threatened by the truth. And he doesn't want to do that probably for me or other of his clients. He has other clients also, I assume. And he doesn't want to tell the truth for me or other of his clients. Okay, thank you very much, everybody.