Top Trump deputies say they can put the plan in place using
existing powers. But critics see it as a brazen election year ploy.
By RACHEL ROUBEIN and SUSANNAH LUTHI 09/25/2020 07:41 PM EDT
President Donald Trump’s surprise pledge to send
$200 drug discount cards to older Americans has left even his top deputies and
health officials scrambling to explain how it would all work — assuming it’s
even legal.
The administration says it can put the plan in
place using existing powers to test new ways of delivering health care. But
critics see it as a brazen election year ploy to buy votes that could exceed
presidential authority while sapping Medicare’s finances.
Skeptics seized on the way the administration
may rely on projected savings from a new drug pricing initiative still under
development to justify the more than $6 billion expense as a sign the plan is
built on flimsy promises.
Congress also hasn’t authorized spending money
on the cards. Administration officials at a briefing Friday morning did not
tell senior congressional staff about what pots of money would be tapped to
launch the effort, though one former administration official with knowledge
said the Medicare trust fund is a likely target.
Administration officials on Friday didn’t answer
questions about what the cards would look like — and if they would bear the
president’s name, like coronavirus stimulus checks the Treasury sent to tens of
millions of Americans this spring.
“The administration’s claim to be using
imaginary savings from non-existent drug price reforms means that Trump’s
coupons come at Medicare’s expense, and that seniors and taxpayers are paying
the price for this stunt,” House Speaker Nancy Pelosi said.
It’s not the first time that a president has
tested his power ahead of an election to make a sweeping health care change.
Barack Obama bypassed Congress to reward
top-performing private Medicare plans ahead of his re-election campaign. The
plan to provide bonus payments sparked Republican-led congressional
investigations, and watchdogs at the Government Accountability Office called on
the Obama administration to shut it down. The program ended in 2014.
With congressional action on drug prices
stalled, Trump has sought to wield executive power to deliver on his pledge to
lower costs ahead of Election Day. The drug coupon announcement was just one of
a series of recent executive actions on drug pricing that his administration
previously considered. Others included a plan to tie Medicare payments to
cheaper prices paid abroad and to provide drug discounts directly to seniors.
However, neither is expected to have an immediate impact on prices.
The Trump administration two years ago explored the idea
of allowing pharmaceutical companies to offer discount cards to help seniors
with their prescription drug costs, but noted that it would have to carve out a
safe harbor from federal anti-kickback statutes to make the plan work.
Officials this summer broached the possibility of drug companies paying for
$100 discount cards ahead of the election as part of broader efforts to control
drug expenses but were rebuffed by industry officials.
Then, Trump unexpectedly revived the idea during
a Thursday health care speech in Charlotte, N.C., catching the drug industry
and health care interest groups off guard and putting his aides on the hook to
answer legal and logistical questions.
On a call with reporters Friday, federal health
officials repeatedly said that more details would be forthcoming, and that the
cards would “go out as soon as mechanically possible,” while noting they
wouldn’t all be distributed by Election Day.
Much of the focus is on a Medicare program
called the 402 demonstration that’s used to test innovations that could save
money or improve the quality of care. But health policy experts say a move on
this scale is unprecedented and may exceed the scope of Medicare law.
“What’s the rationale for considering a cash
payment to Medicare beneficiaries a demonstration? What are they testing?”
asked Juliette Cubanski, a deputy director at the Kaiser Family Foundation.
Election-year politics make the legal questions
of the administration’s claim to Medicare authority even dicier, said Eliot
Fishman of the Washington advocacy group Families USA.
“Politics impact the legality of this, when it’s
used for such a transparently electioneering purpose as this,” Fishman said.
Administration officials still were working out
key details Friday, leaving congressional staff baffled after a morning
briefing.
“They would tell us zero,” said one Democratic
congressional staffer on the call. “I got dumber from participating in the
call.”
After Trump’s Thursday speech, two White House
officials told POLITICO that the cost of the cards would be offset by a plan
tie the price Medicare pays for certain drugs to lower prices paid in other
countries. But on a Friday press call, a senior HHS official said details of
how to pay for the plan “are still yet to come,” and promised more out of the
White House “in the near future.”
The confusion has left congressional Democrats
unsure what legal grounds they can use to stop the move. It’s not clear who
would sue over potential misuse of an obscure Medicare law, Fishman said.
Zachary Brennan contributed to this report.
https://www.politico.com/news/2020/09/25/trump-prescription-drug-card-plan-421993
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