Trump's Surprise Plan for Coronavirus Coverage

White House Says Government Will Pay Hospitals for Coronavirus Care for Uninsured

The Trump administration sprung a couple of surprises last week: It said that it would not reopen the Obamacare exchanges for a special enrollment period that would allow more people to sign up for coverage in the midst of the coronavirus pandemic. Then, faced with mounting questions over coverage for those who were uninsured — or who might lose their employer-provided plans as job losses soar — the administration said late Friday that it will reimburse hospitals for the costs of treating uninsured patients suffering from Covid-19.

The administration’s plan: Speaking at the daily Coronavirus Task Force briefing, Health and Human Services Secretary Alex Azar said the payments would come out of the $100 billion allocated to hospitals as part of the $2 trillion coronavirus relief package. Hospitals will be paid at the Medicare rate for services provided to patients with Covid-19. In order to receive the funds, hospitals must agree not to bill patients or issue unexpected charges, Azar said.

‘Purely ideological’: Azar’s announcement came just a few days after Trump decided not to reopen the federally operated health care exchanges — which offer Obamacare plans in 32 states during the fall enrollment period — in response to the crisis caused by the pandemic. Politico reported late Friday that the decision came as a surprise to the health care industry, which supported reopening the exchanges.

The decision also surprised some members of Trump’s own administration and raised questions about playing politics in the middle of a terrifying pandemic. “It’s a bad decision opticswise,” one administration official told Politico. “It politicizes people’s access to health services during a serious national health emergency.” Another unnamed Republican questioned to logic behind the decision. “You have a perfectly good answer in front of you, and instead you’re going to make another one up,” the source close to the administration told Politico. “It’s purely ideological.”

Still, the administration portrayed the payment program as a superior option. “In many respects, it’s better for those uninsured individuals,” Azar said Friday. “What President Trump is doing here with this money is an unprecedented, disease-specific support of care for individuals to make sure that people get treatment.”

Big questions remain: Larry Levitt of the Kaiser Family Foundation said Monday that there is still a lot of uncertainty about the administration’s plan, which could leave some uninsured patients exposed to big charges. Doctors could issue their own bills, Levitt said, and anyone who receives treatments but tests negative for Covid-19 could be billed for the full cost of their care. “[T]he details of how it’s implemented will determine how protective it truly is,” Levitt said, adding that “it won’t be the same as comprehensive health insurance.”

Tweet of the Day

Matt McDonald of the Republican consulting firm Hamilton Place Strategies says that in response to the coronavirus, federal spending as a share of the economy will rise to levels not seen since World War II. (h/t Axios)

Another woeful milestone today: The U.S. death toll reached 10,000.

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Coronavirus Response Will Add $4 Trillion to US Debt, Goldman Sachs Says

Economists at Goldman Sachs say additional fiscal measures to support an economy battered by the coronavirus pandemic are likely to be necessary, and they expect those next steps could add another $500 billion (2.4% of GDP) to this year’s deficit and up to $1.5 trillion (7% of GDP) over the next couple of years.

“We assume additional fiscal easing because the measures enacted to date, while substantial, are not yet equal to the lost income due to COVID-19 that we expect,” Goldman economist Alec Phillips wrote in a note to clients Monday.

While the next phase of congressional coronavirus relief is still in its early stages — and there are already signs that reaching consensus on that package may be difficult — Phillips suggests that Congress might need to provide more funding for small business loans, unemployment benefits and aid to state and local governments, with additional direct payments to individuals also possible. But, he suggests, those programs may not be as large as they were in the CARES Act signed into law late last month.

Phillips also throws come cold water on the possibility of a large infrastructure package, though he suggests a more modest program on the order of $50 billion to $100 billion might be included. “While it is true that there is bipartisan interest in infrastructure, the debate over the long-term program has been over how to finance it over the long-term and on this, the two political parties have not come much closer to an agreement,” he writes.

The deficit and debt effects: In all, Phillips projects, the various phases of coronavirus relief will raise the deficit to about $3.6 trillion (nearly 18% of GDP) this year and $2.4 trillion (11% of GDP) next year — a total increase of about $4 trillion over the two years.

News

• Congress Reverts to Feuding, Imperiling New Steps on Economy Aid – Bloomberg
• Americans Hit by Economic Shocks as Confusion, Stumbles Undermine Trump’s Stimulus Effort – Washington Post
• Underfunded, Understaffed and Under Siege: Unemployment Offices Nationwide Are Struggling to Do Their Jobs – Washington Post
• Government Tech Struggles to Dole Out Coronavirus Stimulus Cash – Axios
• Health Experts Call for Roosevelt-Style Programs to Kill Virus, Revive Economy – The Hill
• U.S. Is Nowhere Close to Reopening the Economy, Experts Say – New York Times
• Top Democrats Press Treasury to Accelerate Airline Bailout – New York Times
• In Congress, Doctors Are Pressing for a More Aggressive Coronavirus Response – New York Times
• Janet Yellen Says Second-Quarter GDP Could Decline by 30% and Unemployment Is Already at 12%-13% – CNBC
• What Top CEOs Fear Telling America About the Coronavirus Shutdown – Axios
• End Lockdown for Young to Give Economy a Chance, Research Says – Bloomberg
• Health Insurance Industry Eyes Federal Aid Amid Coronavirus Pandemic – Yahoo Finance
• Overwhelmed Hospitals Face a New Crisis: Staffing Firms Are Cutting Their Doctors’ Hours and Pay – ProPublica
• This Tiny Federal Agency Was Built to Respond to a Crisis Like Coronavirus. Now That It’s Here, Is BARDA Ready? – STAT
• TurboTax Offers Free Tool to Help Americans Who Don’t File Taxes Get Stimulus Payments – CNBC

Views and Analysis

• Four Inevitable Results of This Pandemic – Peter R. Orszag, Bloomberg
• Three Things Will Determine If There’s an Economic Depression – Tim Duy, Bloomberg
• Let’s Avoid Another Great Depression – E.J. Dionne Jr., Washington Post
• Here Comes the Great Deflation Threat – Robert J. Samuelson, Washington Post
• How to Save the Economy – Brian Riedl, Washington Examiner
• Be Skeptical of Any Claim the US Economy Will Recover Quickly – Bart van Ark and Erik Lundh, CNN Business
• Why Trump Is So Reluctant to Put the Economy on a War Footing – Jeff Spross, The Week
• Trump Is Using the States as Scapegoats for His Coronavirus Calamity – Joel Mathis, The Week
• How Tea Party Budget Battles Left the National Emergency Medical Stockpile Unprepared for Coronavirus – Yeganeh Torbati and Isaac Arnsdorf, ProPublica
• Meet Rocco. He Owns a Dairy Queen. The Government’s Flawed Coronavirus Plan Might Not Save It – Jordan Weissmann, Slate
• How Economists Are Trying to Answer Coronavirus Questions – Eduardo Porter, New York Times
• Serological Coronavirus Testing Could Be Key to Economic Reopening – Dan Primack, Axios
• "Whatever It Takes." Getting into the Specifics of Fiscal Policy to Fight COVID-19 – Olivier Blanchard, Peterson Institute for International Economics
• A Tax Break for Coronavirus-Hit States – Tom Suozzi, Wall Street Journal (paywall)
• How Healthy is Your State’s Rainy Day Fund? – Janelle Cammenga, Tax Foundation
• The U.S. Tax Code Robs the Workforce of 20 Million Women – Rachel Rosenthal, Bloomberg