Walker exaggerates effect of Trump drug order, Biden freeze

A Republican running for U.S. Senate in North Carolina says Joe Biden is already raising drug prices for some of the most vulnerable Americans.

Former Congressman Mark Walker hopes to replace U.S. Sen. Richard Burr, who won’t seek reelection next year.

Two days after Biden’s inauguration, Walker took aim at the new Democratic president.

"The disdain for President Trump and his accomplishments are so deep that President Biden is raising the prices of insulin and Epi-Pens on those with high costs and the uninsured," Walker tweeted.

He linked to this story by Modern Healthcare. Walker’s claim is similar to others that have been fact-checked by PolitiFact and other media.

Walker is referencing President Trump’s executive order requiring community health centers, specifically, to give the lowest price possible for insulin and injectable epinephrine to their low-income and uninsured patients. However, Walker’s tweet exaggerates the effect of Trump’s order, and the effects of Biden’s decision to freeze it.

Community Health Centers, sometimes referred to as Federally Qualified Health Centers, or FQHCs, are government-supported clinics that help people facing financial obstacles to care and prescription drugs. 

Before Trump left office, his administration signed-off on a rule requiring those centers to pass along discounts they’re receiving through the federal government’s 340B program. The idea was to prevent mark-ups.

Sayeh Nikpay, associate professor of health policy and management at the University of Minnesota School of Public Health, emailed PolitiFact for a separate story on the Trump order. Her email described the program this way:

"The program was designed to allow community health centers the opportunity to raise some funds from the sale of discounted drugs to patients.

What this means in practice is that when an insured patient goes to the clinic, the clinic bills insurance and gets to keep the difference between the mandated acquisition price (usually about half of the full cost) and the insurer reimbursement.

Lawmakers have been okay with this because safety net clinics are federally funded and don’t typically have that many insured patients, so this should be happening on the margins."

Indeed, experts told PolitiFact that any extra money is marginal at best. 

While it’s true that Biden froze all of Trump’s pending rules at once, it’s misleading to suggest Biden did it out of disdain. 

Adam Fein, a business consultant who runs a blog about pharmaceutical economics, wrote that he was surprised by Trump’s decision to target community health centers.

"I generally consider these covered entities to be the good guys of 340B," Fein wrote in July after Trump announced his plans. "Notably, the executive order doesn’t mention hospitals, which are the worst abusers of the 340B program."

As the health department noted in its December summary of Trump’s order, health centers are already required to reinvest any income from the 340B Program into patient services. Also in the summary, the U.S. Health Resources and Services Administration (HRSA) said it’s aware of the health centers’ "compliance with the 340B statute and strong track record of using the savings generated to benefit patients."

The National Association of Community Health Centers released a Jan. 25 statement saying Trump’s administration misunderstood the issues. The red tape created by his order would have hindered the centers’ ability to serve their patients, said Colleen Meiman, policy advisor for State Associations of Community Health Centers.

"All the Trump order did was say ‘If you can’t prove (you’re passing along the discounts), we’re going to punish you,’" Meiman told PolitiFact in a phone interview.

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The U.S. HRSA estimated that each health center would, on average, need to hire an additional worker at about $50,000 a year "to support necessary additional administrative processes."

Trump’s order was scheduled to take effect on Jan. 22.

However, on Jan. 20, Biden’s administration froze Trump’s order until March 22. 

Walker’s tweet implies that Trump’s order had already lowered the prices of those medicines. But it hasn’t become law yet.

Even if Trump’s order had taken effect on Jan. 22, those drug prices wouldn’t have gone down immediately, said Karyn Schwartz, a senior fellow at the Kaiser Family Foundation health advocacy group. The providers affected by Trump’s order would need to come into compliance by the time they apply for their annual grant, she told PolitiFact in a phone interview.

"It wasn’t like a switch was going to get flipped on the 22nd," Schwartz said.

The Biden administration hasn’t yet said whether Trump’s order will be scrapped altogether.

Walker said Biden "is raising the prices of insulin and Epi-Pens on those with high costs and the uninsured."

Biden froze a directive that would have ordered some health centers to provide insulin and epi-pens at the same price they purchased them through a government program. 

But experts say the health centers were already providing the discounts. Furthermore, Biden froze Trump’s order before it ever took effect, so it’s inaccurate to suggest prices are going up.

The program’s status quo will continue until a final decision is made. We rate this claim Mostly False.