The Wall Street Journal’s conservative editorial board has delivered a scathing critique of President Donald Trump’s latest proposal to cap prescription drug prices under Medicaid, calling it “his worst idea since tariffs” and warning that it could backfire dramatically for both patients and the Republican Party.
In a sharply worded editorial, the board, known for its traditional conservative views, argued that the plan would introduce dangerous price controls, jeopardize access to essential medications, and accomplish little in terms of meaningful budget savings.
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“President Trump and Republicans appear to be shrinking from reforming Medicaid, but that’s not the worst of it,” the board wrote. “To replace the spending slowdown, they won’t get into Medicaid, so they may expand drug price controls. For that trade, we could have elected Democrats.”
Trump’s plan would link Medicaid drug prices to those paid in other developed countries, typically much lower than U.S. prices. While the move may sound like a win for affordability, the Journal argues the economic consequences would be disastrous.
“Medicaid already receives hefty discounts for drugs under statutory formulas that require manufacturers to kick back a share of a medicine’s price to states in a rebate,” the editorial explained. “Medicaid rebates in 2023 amounted to 52% of the program’s drug spending. Because Democrats in 2021 removed a cap on these rebates, state Medicaid programs may pay nothing for some drugs.”
Moreover, the board pointed out that prescription drugs make up only a small slice of Medicaid spending. “Drugs accounted for less than 4% of Medicaid spending ($21.2 billion) in 2023. The feds spent 10 times more on hospital payments,” they wrote. “Even if Republicans required drug makers to give away medicines to Medicaid, savings wouldn’t come close to $880 billion.”
Beyond ineffective cost savings, the Journal warned that the proposal could hurt public health and increase long-term costs. “Drugs actually reduce Medicaid spending by preventing complications that require expensive hospital care,” the board wrote. “Take hepatitis C antiviral drugs, which have a 95% cure rate. A treatment course can cost upward of $24,000. But the Congressional Budget Office estimates that expanding Medicaid patient access to these drugs would save $7 billion over a decade.”
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Perhaps most alarmingly, the board suggested that pharmaceutical companies could opt out of Medicaid entirely rather than comply with the proposed pricing model. That could lead to reduced access to life-saving medications for low-income Americans.
“Drug price controls are a Democratic perennial,” the editorial concluded. “If Republicans go along with Mr. Trump’s most-favored-nation plan, Democrats will invariably extend it to Medicare and the commercial market next time they control Congress. If Republicans lack the courage to reform Medicaid, they should at least do no harm.”
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