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Bob Kocher and Peter R. Orszag

Doctors Hold the Key to Lower Drug Prices

A new model would reward physicians for delivering better care by making smarter prescriptions.

There is another way.

There is another way.

Craig F. Walker/The Boston Globe via Getty Images

The U.S. is grappling with how to rein in high drug prices. Unfortunately, most of the proposed solutions work better on a bumper sticker than in reality. The debate, however, tends to ignore a key player -- the prescribing doctor -- who could have a central role in a more sustainable approach to better value in drug pricing.

A major driver of high drug prices is the lack of value consciousness on the part of prescribing physicians. Fee-for-service medicine creates incentives for doctors to care only about effectiveness and patient convenience when prescribing. In most cases, they are not even aware of the price of a drug or how much it costs the patient. To combat physician insensitivity to price, health plans have evolved a series of strategies, but they work imperfectly and often alienate patients and physicians.