Bad Policies Are Being Proposed by HHS Secretary Nominee Xavier Becerra | Citizens Against Government Waste

Bad Policies Are Being Proposed by HHS Secretary Nominee Xavier Becerra

The WasteWatcher

The first clue that Joe Biden, the presumptive 46th President of the United States, was choosing someone he did not know well, California Attorney General Xavier Bercerra, as the nominee for secretary of the Department of Health and Human Services (HHS) was when he mispronounced his name as Bacheria and incorrectly named the agency he would direct by saying “Secretary of Health and Education Services.”  He should know him because Mr. Becerra had served in the House from 1993 to 2017 and as AG since 2017, following Kamala Harris after she won her election to the Senate.  Perhaps the former vice president was thinking of the old Department of Health, Education, and Welfare, which was changed to HHS when a separate Department of Education was created and signed into law by President Jimmy Carter in 1979.  The President-elect was a senator at that time and had been since 1973.

AG Becerra is a controversial nominee.  Republicans have roundly criticized him for his lack of healthcare experience (although other HHS secretaries have similarly lacked that background) and called him a radical choice, especially social conservatives, and a methodical partisan.  As AG, he filed about 100 lawsuits against the Trump administration concerning a variety of issues from the Patient Protection and Affordable Care Act (ACA), or Obamacare, to climate change.  A December 8, 2020 Kaiser Health News article noted, “although he would bring years of health politics and policy work to the role, none of it comes from front-line experience as an executive or administrator running public health programs, managing patient care or controlling the spread of disease.”  Essentially, he could lead the way to overturn and undermine everything that was done to encourage the free market that drove down healthcare costs and helped patients by HHS under the Trump administration.

AG Becerra is certainly not a limited government advocate, earning a lifetime rating of 8 percent in the Council for Citizens Against Government Waste 2016 Congressional Ratings.  In October 2017, he told “Fox News Sunday” that he would absolutely support Sen. Bernie Sanders’ “Medicare for All” legislation and had been supportive of such an idea “for the 24 years that I was in Congress.”  Implementing Sen. Sanders’ plan would mean everyone would lose their private health insurance, something that President-elect Biden supposedly does not want, preferring a public option in the ACA, instead.

Current Centers for Medicare and Medicaid Administrator Seema Verma has been successful in making substantial changes to improve healthcare delivery and provide more choices in how the ACA operates by creatively using State Innovation Waivers.  These waivers have helped states successfully implement reinsurance programs and as a result, the healthcare market in these states were stabilized, premiums went down, and those with preexisting conditions were protected.  It would be a shame if as HHS secretary Mr. Becerra (or anyone else who serves in that capacity) withdrew these effective plans from the states.

According to the December 10 New York Times, Mr. Becerra could use the waivers to “reflect his long track record of supporting single-payer health care” and provide states the funding to do so without having to go through Congress.  In other words, Medicare for All state by state.

One troubling article from the December 9 Inside Health Policy stated that Mr. Becerra could decide to use “march-in rights” to lower the costs of the COVID-19 treatment remdesivir, as well as other COVID-19 drugs and vaccines.  The Trump administration did not use the march-in policy, but it is plausible that AG Becerra could.  He led the charge with 33 other states attorneys general, demanding in an August 4, 2020 letter, that HHS use march-in rights under the Bayh-Dole Act to take Gilead’s remdesivir patent should they not be able to produce enough of the drug and license the patent to a third party to manufacturer.

CAGW opposes march-in rights and discussed the reasons why in an August 4 WasteWatcher, days after HHS told AG Becerra and the 33 other states “no” to their demands.  The Bayh-Dole Act was signed into law in 1990 to encourage government-funded research to be developed and marketed.  At the time only 5 percent of this research was being successfully commercialized and thus it could be legitimately called a waste of federal tax dollars.  Bayh-Dole law allows the ownership of an invention that has used government funds to be awarded to the inventor and march-in rights can only be used if the titleholder has not taken action to commercialize the invention.  In other words, it is a precise, limited remedy.  Indeed, it has never been used since the law was enacted.

It is true that taxpayers have contributed millions of dollars under Operation Warp Speed (OWS) to expedite the research and development of the COVID-19 vaccines and medicines that are coming to fruition today and will soon be distributed to millions of Americans and citizens around the world.  It was an exceptional action during an unprecedented pandemic.

There are varying contracts with the companies involved in OWS.  Some allow march-in rights in different instances, like if the company cannot make enough of the medication to meet supply.  But the pharmaceutical companies, which pay taxes too, have also contributed millions of dollars at enormous risk to produce them.  If AG Becerra or any other future HHS secretary decides to use march-in rights and take control of a pharmaceutical company’s patent, there will be fewer private research entities or manufacturers that will take the risk to commercialize any invention that was funded with government funds and as a result the American people will be deprived of valuable, and in many cases, life-saving products.

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