J&J CEO is advocating that Trump and Republicans maintain some ACA provisions

Alex Gorsky
J&J CEO Alex Gorsky is advocating that President Trump and Congressional Republicans maintain some provision of the Affordable Care Act.

The president and Republicans are moving quickly to dismantle the Affordable Care Act, but some in Big Pharma believe parts of it should be preserved, including the head of the biggest of the big. Johnson & Johnson CEO Alex Gorsky said there are aspects of the ACA that can help patients and lower costs for the country.

Gorsky, who was among business leaders to meet Monday with Trump, said he will push for two of the well-liked provisions, insurance coverage of preexisting conditions and allowing children to remain on their parents’ health plans until they are 26. He also will advocate for retaining a competitive market for individual health insurance, and continuing the move toward value-based care and payment for improved patient outcomes.

“Finally, we support reforms and emphasize wellness and intercepting disease before it happens, preventive care, more latitude for employer wellness programs and incentives for healthy,” Gorsky said during the Q4 earnings call this week in which the company reported weaker numbers.  

The CEO said “as a U.S.-based multinational company, we also are advocating for the modernization of the U.S. tax codes,” according to a Seeking Alpha transcript of the call. 

Asked about his views on President Trump’s tweets that he will go after pharma on pricing, Gorsky offered diplomatic responses.

“I think it’s incumbent upon us as an industry to price responsibly.... We believe that that has in fact been our practice,” Gorsky said.

He also pointed the company’s planned “transparency report” to be released later in the year, which he said will expand disclosures on U.S. pricing and value, as well as R&D and sales and marketing expenses. “We recognize that this is one step towards demonstrating how serious we are about responsible pricing. In the long-term, we know it will take all parts of the healthcare system working together to address the challenges we are facing,” the CEO explained.

The industry cannot let a few bad actors in the industry color the “incredibly important contribution the pharmaceutical industry makes to overall healthcare,” Gorsky said. He cited figures which he said shows that while pharma accounts for between 10% and 14% of overall healthcare costs, it accounts for maybe 75% of the improvements in things like mortality, coming from improvements in things like cardiovascular disease, cancer and HIV.

Whether any of the items Gorsky believes are important enough to be included in a replacement plan for the ACA won’t be known until Republicans divulge their thoughts. There are lots of discussions, and the administration is taking the steps it can to erase evidence of the law. It canceled ads that traditionally run this time of year reminding people of the signup deadline for inclusion in the program, The New York Times reports.

There also is talk of eliminating some of the taxes created to fund the act, including ditching the tax on prescription drugs, The Hill reports. But there is an expectation that some of the taxes will have to be retained to fund a replacement plan. Since there was never a big movement to overturn the tax on drugs, as there was against the tax on medical devices, it might remain. It is estimated to generate $27 billion over 10 years.

Lori Robbins, managing director of the healthcare tax group in KPMG’s Washington National Tax practice told The Hill that he thinks other fees in the legislation are probably bigger targets. “I would consider [the branded prescription drug tax] as middle of the road in terms of the appetite for getting rid of it,” Robbins said.