Trump Could Win on Obamacare — and Still Lose

Wednesday, July 10, 2019

Plus, a brewing fiscal fiasco?

How Trump and the GOP Could Win on Obamacare — and Still Lose

A federal appeals court in New Orleans heard oral arguments on Tuesday in the lawsuit challenging the constitutionality of the Affordable Care Act now that Congress has zeroed out the law’s penalty for individuals who fail to buy insurance.

Legal experts, including those who oppose the health care law, have been skeptical about the merits of the suit, but two Republican-appointed judges on the three-member appeals court panel questioned whether Obamacare should be allowed to stand. If they uphold a lower court ruling invalidating the law in its entirety, the decision would almost certainly bring the ACA back before the Supreme Court — but it could push the messy U.S. health care system into even greater chaos, creating widespread uncertainty for millions of Americans who stand to lose coverage.

“It’s not just that 21 million people would probably lose health insurance, or that 133 million Americans with pre-existing conditions would lose their protection. Those effects would be the major focus of attention if the Affordable Care Act were to be struck down,” writes Margot Sanger-Katz at The New York Times. “But the law was much, much broader, affecting a wide range of health programs, even some areas you might not think of as related to health. Overturning the entire law would mean all of its parts, in theory, would go away at once.”

In other words, President Trump and the GOP should be careful what they wish for. “If Trump gets what he’s hoping for in New Orleans, there’s a strong argument to be made that the president will be like the proverbial dog that catches up with the truck,” The Washington Post’s James Hohmann writes. “Health care – the issue that dogged Republican candidates in the 2018 midterms more than any other – would almost certainly take a starring role in the 2020 campaign. The Supreme Court would probably then hear an appeal, in which [Chief Justice John] Roberts would probably again cast a deciding vote – one way or another – in June of an election year.”

Republicans are already squirming uncomfortably about the prospect of having the health care issue thrown back in their laps. Hohmann and others pointed out that Senate Majority Leader Mitch McConnell refused to say Tuesday whether he supports the legal challenge against the ACA, instead emphasizing that, if the law is struck down, GOP lawmakers would act quickly to restore protections for patients with pre-existing medical conditions. But as Bloomberg’s Sahil Kapur points out in a tweet, “This sounds fairly starry-eyed when 1) there’s no plan, 2) ACA battle is rooted in a partisan dispute over how to handle preex conditions.”

Number of the Day: 27%

A new Wells Fargo analysis of Wolters Kluwer PriceRx data found that drugmakers are once again aggressively raising prices, with increases last month averaging 27%, Bloomberg reports.

“To us it appears now that the criticism from politicians and the President has quieted down, companies are more aggressively and broadly pursuing drug price increases again,” Wells Fargo analyst David Maris said in a research note cited by Bloomberg. “We are not so confident that the lull in criticism will continue and could foresee more negative headlines in the coming months.”

White House Might Be Open to Progressive Drug Price Proposal: Report

Three top White House advisers suggested for the first time Tuesday that they might be open to a proposal favored by liberals to cap drug price increases. STAT’s Lev Facher and Nicholas Florko report on a closed-door briefing of GOP senators:

“Health secretary Alex Azar joined Joe Grogan, the president’s top policy adviser, to encourage senators to pursue bipartisan legislation on drug pricing and potentially to include one idea from Sen. Ron Wyden (D-Ore.) that would cap some drug price hikes at the rate of inflation, according to senators who attended. Multiple lobbyists and an administration spokeswoman told STAT the White House also deployed Eric Ueland, its top congressional liaison, to the meeting.”

The officials’ apparent openness to the inflation indexing is further evidence that the Trump administration has become increasingly reliant on Capitol Hill for a victory on drug costs, Kaiser Health News says — especially after its proposed rule to have drugmakers include prescription prices in TV ads was blocked this week by a federal judge.

GOP Disagreements Could Make It Harder to Tackle Surprise Medical Bills

Lawmakers had hoped they could agree this summer on a plan that would curb surprise medical bills, but intense lobbying by interested groups and disagreements among Republicans are making it difficult to move forward, The Wall Street Journal’s Stephanie Armour and Kristina Peterson report.

While there is broad agreement that patients need protection from large and unexpected charges that sometimes appear on hospital bills, especially as a result of emergency care, differences have emerged over how to settle billing disputes and who should be forced to absorb any financial hits.

A bill from Sens. Lamar Alexander (R-TN) and Patty Murray (D-WA) would allow insurers to pay out-of-network doctors, who are often the source of unexpected charges, at a benchmark rate determined by the cost of other doctors in the same area. But this approach, which is supported by insurers and employers, is opposed by some hospital and doctor groups, who are calling for an arbitration system to settle disputes.

On top of that, some conservative Republicans, including Sens. Mike Lee (R-UT) and Ted Cruz (R-TX), have expressed concerns that the benchmark approach amounts to rate-setting by the government, which would violate their allegiance to free markets and could raise constitutional issues.

Together, these complications suggest the bill has a difficult road ahead of it. Senate Majority Leader Mitch McConnell (R-KY) has signaled that he supports the Alexander-Murray bill, but there’s no guarantee it will pass if he does bring it to the floor, especially if Democrats use the opportunity to take a stand on a variety of health care-related issues, including the status of the Affordable Care Act, Armour and Peterson said.

Can Lawmakers Avoid a Fiscal Fiasco?

Congress has until the end of September to fund the government for the next fiscal year and avoid another shutdown. It might have even less time to raise the government’s borrowing limit and avoid a market-rattling crisis.

So far, though, there have been few public signs of progress in ending the current stalemate.

Trump administration officials and congressional leaders are reportedly working to revive their stalled budget talks. The Trump administration’s negotiators, including Treasury Secretary Steven Mnuchin and acting White House chief of staff Mick Mulvaney, reportedly met with top congressional Republicans on Wednesday afternoon. And Mnuchin was set to talk by phone for the second straight day with House Speaker Nancy Pelosi (D-CA) after Pelosi shot down the idea of more meetings with administration negotiators.

Lawmakers are reportedly looking to increase spending caps as part of a two-year deal and also raise the debt ceiling before August. White House officials, meanwhile, have pushed for a year-long spending freeze and a separate increase in the debt ceiling — options that even GOP lawmakers find problematic.

"The best way is to get a caps deal with Democrats and let the debt ceiling ride on it," Senate Majority Whip John Thune (R-SD) said on Wednesday morning, according to Politico. "It would be great to get it done before August."

Trump’s Fourth of July Celebration Cost the Pentagon at Least $1.2 Million

The Department of Defense said Tuesday that President Trump’s “Salute to America” event on July 4th cost the military $1.2 million. However, there is still some uncertainty about the total cost for the Pentagon. Oriana Pawlyk of Military.com said it is “unclear how the cost for the parade, which has come under scrutiny, was calculated.”

The $1.2 million figure appears to include the cost of moving military equipment to the National Mall, notably a pair of M1 Abrams tanks and the Bradley infantry fighting vehicles that sat in front of the president during the event.

Overall, though, the “figure cited by the Pentagon does not equal the total cost to taxpayers and covers only those expenses that were paid by the military’s budget specifically,” The Hill’s Jordain Carney says. In particular, it’s not clear how the cost of the flyovers by aircraft from each of the military services is being accounted for; the Associated Press reported that those as yet undefined costs are coming out of the service’s training budgets.

The cost of the flyovers — which included MV-22 Osprey aircraft based in Virginia; F-35C Lightning II stealth jets based in California; F/A-18 Hornets based in Virginia and Florida; a B-2 Spirit bomber based in Missouri; and a Boeing 747 frequently used as Air Force One based in Maryland — was likely significant, given the high hourly operating costs of the aircraft. The B-2 bomber, for example, costs about $122,000 per hour to fly, according to Pawlyk.

The total parade cost is higher: In addition to the direct and indirect military costs, the Department of the Interior is reportedly shifting $2.5 million from funds meant to maintain national parks to cover costs related to the event. And on Wednesday the mayor of Washington, Muriel E. Bowser, said that Trump’s celebration and the protests it sparked cost the city government $1.7 million, bankrupting a fund that is used to provide security at special events.

Lawmakers call for investigation: Earlier this week, Senate Democrats asked the Government Accountability Office to investigate the total cost of the event, as well as whether it violated any legal restrictions on political activity by the Trump administration.

“Congress did not specifically provide funds to cover the costs of the President’s expanded Fourth of July events, and we are very concerned by the impacts and the precedent of diverting limited Federal resources—including the use of military personnel, equipment and aircraft as well as other appropriations or visitor fees paid to improve national parks—to organize and execute unbudgeted events,” the senators said.