Trump’s ‘Pinky Promise’ on Health Care

By Yuval Rosenberg

Trump’s ‘Pinky Promise’ on Health Care

The White House and President Trump made some big promises
about his speech on health care Thursday afternoon in Charlotte,
North Carolina. The White House said Trump would be laying out “his
comprehensive health care vision.” The president himself, early in
his speech, said his plan “expands affordable insurance options,
reduces the cost of prescription drugs, will end surprise medical
billing, increases fairness through price transparency, streamlines
bureaucracy, accelerates innovation, strongly protects Medicare,
and always protects patients with preexisting
conditions.”

If you’re reading this or have paid any attention to
health policy over the last four years, you know what’s coming next
(but keep reading because some of the details might still surprise
you and the responses to Trump are worth it). There was, of course,
no comprehensive plan. As for vision, to the extent that there was
one undergirding Trump’s announcements, seemed to be more about
cynical political maneuvering than genuine health care
reform.

Trump has long promised to unveil a health care plan that
would be less expensive than Obamacare while offering superior
coverage. On Thursday, he suggested he had already accomplished
those goals, touting an assortment of actions taken or proposed by
his administration as his vision, billed as the “America First
Healthcare Plan.” (Trump has, for example, pushed for lower drug
and hospital prices, increased price transparency and expanded the
use of less expensive, short-term plans that critics call “junk
insurance” because of their limitations. See this
overview of his record for more.)

“Obamacare is no longer Obamacare, as we worked on it and
managed it very well,” Trump said. “What we have now is a much
better plan. It is no longer Obamacare because we got rid of the
worse part of it — the individual mandate.”

But health care experts found Trump’s “plan” sorely lacking in
details. “It's not a plan, it's a mirage. It's a series of
aspirations with no specific policy proposals to back them up,”

tweeted Larry Levitt, executive vice president for
health policy at the Kaiser Family Foundation, a non-partisan
non-profit focused on health.

“The actual policies they announced,” STAT News’s Lev Facher and
Nicholas Florko
wrote, “are simple, superficial, and non-binding
executive orders. Neither will improve the quality of Americans’
health care or lower its cost.”

What Trump did: The president signed executive orders
that appear designed to win over voters — but that experts say are
likely to have little impact on American’s actual health care.

Trump’s executive orders pledge to protect Americans with
preexisting conditions; promote new rules allowing states to import
lower-cost prescription drugs from Canada; and direct the Health
and Human Services secretary to push for legislation banning
surprise medical bills by the end of the year and pursue
administrative action if that effort fails.

Trump also promised to send $200 discount cards to 33 million
Medicare beneficiaries, though it’s unclear whether he has the
legal authority or the funding to do so.

Here’s a look at some problems and questions surrounding Trump’s
orders.

Preexisting conditions: Trump’s pledge on preexisting
conditions carries no legal weight — unlike the protections
provided under the Affordable Care Act, which Trump is seeking to
invalidate. White House officials
reportedly acknowledged that Trump’s protections
would not bear the weight of law but were a "defined statement of
U.S. policy.” That doesn’t mean much.

“It’s as if I was walking around with a memo that was titled
‘Executive Order,’ and claimed that the policy of the United States
is that everybody gets a cheeseburger on Tuesdays,” Nicholas
Bagley, a professor at University of Michigan’s law school and
Obamacare supporter, told
Reuters. Levitt of the Kaiser Family Foundation
compared it to a “pinky promise.”

That promise, as ineffectual as it may be, was made necessary by
the Trump administration’s support for the ongoing lawsuit seeking
to wipe out Obamacare in its entirety.

The executive order “is yet another example of Trump's political
gaslighting on the subject,”
writes Axios’s Caitlin Owens. “Republicans have
never come up with another way to offer the same level of
protection the ACA does. If Trump succeeds in stripping the ACA's
protections away, people with preexisting conditions would have
every reason to worry about their coverage.”

The $200 prescription drug coupons:  STAT’s Facher
and Florko calls this a "political ploy to curry favor with seniors
who view drug prices as a priority."

Trump said the discount cards “will be mailed out in coming
weeks” but there are plenty of questions that make it unclear
whether that will happen, including whether Trump has the authority
to do it and where the money might come from.

The White House reportedly said it is getting its authority to
send the coupons from a

Medicare demonstration program, with the $6.6 billion cost of
the plan covered by savings from Trump’s plan to lower drug prices
— a plan that has not yet been implemented. But The Wall Street
Journal’s Stephanie Armour
reported Friday that, according to an
administration official, the proposed funding would come from a
Medicare trust fund under the waiver program for testing new
initiatives. “These waiver programs have generally been required to
show they won’t increase federal spending beyond what would have
occurred without the test,” Armour notes.

The bottom line: Trump’s big health care rollout likely
served to highlight what Trump hasn’t done more than what he has.
“The speech and executive order stood as a tacit admission that
Trump had failed to keep his 2016 promise to replace his
predecessor’s signature achievement with a conservative
alternative,” The Washington Post’s Toluse Olorunnipa writes.
“Unable to repeal the law, Trump appeared open to simply rebranding
it.”

Court OKs Lawsuit Over Trump’s Emergency Border Wall
Spending

A federal court cleared the way Friday for a lawsuit by House
Democrats challenging President Trump’s use of emergency powers to
redirect billions in public funds toward border wall
construction.

Democrats have accused the White House of violating the
Constitution by redirecting more than $6 billion toward the wall
following Trump’s declaration of an emergency at the border in
early 2019. In a unanimous decision, a three-judge panel on the
Court of Appeals for the District of Columbia Circuit partially
overturned a lower court’s ruling that found that the House did not
have standing to challenge Trump on the issue.

“To put it simply, the Appropriations Clause requires two keys
to unlock the Treasury, and the House holds one of those keys,” the
senior judge wrote in the
24-page decision. “The Executive Branch has, in a
word, snatched the House’s key out of its hands.”

The judges rejected the legal theory put forward by White
House lawyers, who argued that Congress needs veto-proof majorities
in both houses to challenge the president’s use of public funds.
“That turns the constitutional order upside down,” the judge wrote.
“The whole purpose of the appropriations clause’s structural
protection is to deny the executive ‘an unbounded power over the
public purse of the nation,’ and the power to ‘apply all its
moneyed resources at his pleasure.’”

Economy Would Do Better Under Biden Than Trump: Moody’s

The economy is widely seen to be a
relative
strength for President Trump, with voters giving
him much higher approval ratings for his handling of economic
issues than other areas. But a new analysis from economists Mark
Zandi and Bernard Yaros of Moody’s Analytics says that Joe Biden’s
economic agenda would spur more growth than Trump’s.

Using an economic model the authors say is similar to those
deployed by the Federal Reserve and the Congressional Budget
Office, Zandi and Yaros estimated the impact of the candidate’s
proposed policies, including changes to the tax code,
infrastructure spending and health care access. The strongest
growth occurs in a scenario in which Biden is able to pass his
agenda through a Congress controlled by his party:

“Largely because of Biden’s substantially more expansive
fiscal policies, the economy would return to full employment more
quickly coming out of the pandemic than under Trump—in the second
half of 2022 under Biden compared with the first half of 2024 under
Trump. Biden’s reversal of Trump’s policies on foreign trade and
immigration would also contribute to stronger economic growth, so
that by the end of their terms in 2024, real GDP would be $960
billion, or 4.5%, larger under Biden than Trump. This translates
into 7.4 million more jobs under Biden than Trump.”

However, much depends on whether the election results in divided
control of Congress. Zandi and Yaros considered four possible
election outcomes, including clean sweeps (full control of the
White House and both chambers of Congress by either party) and
scenarios that involve divided government (Biden wins but the
Senate stays in Republican hands, Trump wins but the House stays in
Democratic hands). The strongest economic results are seen in the
Democratic clean sweep scenario, which the authors give a 20%
chance of occurring.

The other election scenarios result in weaker growth
trajectories, and only modest differences overall (see the chart
below). The election outcome the authors say is most likely — a
Biden win with Republicans maintaining control of the Senate, which
they give a 40% chance of happening — produces the second-best
economic results over the next decade. Divided control with Trump
keeping the White House is the third-best result, while the worst
occurs with a Republican clean sweep.

Other notable findings from the analysis:

Biden’s policies favor the middle class: “Lower-
and middle-income households benefit more from Biden’s policies
than Trump’s. Biden ramps up government spending on education,
healthcare and other social programs, the benefits of which largely
go to those in the bottom half of the income distribution.
Meanwhile, he meaningfully increases taxes on the well-to-do,
financial institutions and businesses to help pay for
it.”

While Trump’s favor the rich: “Trump largely does
the reverse. He makes permanent the temporary tax cuts he
implemented in his first term. The benefits largely go to
higher-income households and businesses, while government spending
is scaled back on healthcare and a range of social programs, the
benefits of which go mainly to those with lesser incomes and
wealth.”

Bigger deficits under Biden: “Biden’s policies will
result in substantially larger federal budget deficits than
Trump’s, particularly during their terms as president. Biden’s
policies cost $2.5 trillion during his time as president on a
static basis, while Trump’s add only a few hundred billion
dollars.”

But the economic cost will be low: “Negative
economic fallout from Biden’s larger near-term deficits is
mitigated significantly. The reason: With the economy far from full
employment and inflation moribund when Biden takes office, the
Federal Reserve’s vows on employment and inflation mean it will
keep interest rates very low for much of the next presidential
term.”

And the debt-to-GDP ratio would be similar after 10
years: "[T]he stronger economic growth supported by Biden’s
policies generates more tax revenue and less government spending.
The results are dynamic budget costs of closer to $2 trillion
during his term. The stronger growth and increase in GDP also mean
that by the end of the decade, Biden’s and Trump’s policies result
in a similar 130% publicly traded federal government debt-to-GDP
ratio. This compares with 108% when they take office."


Read the report at Moody’s.

Quote of the Week

“The president figured out how to take an overwhelmingly good
week and change the subject? Shocking. I don’t know what to
say.”

– An unnamed senior Republican senator, as quoted at

The Hill, “referring to the dismay Republicans
felt over what they see as Trump’s latest unforced error,” namely
the president’s refusal to promise a peaceful transition of power
if he loses the election in November.

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