President Trump's New Executive Order: Deserves Praise and Raises Questions | Citizens Against Government Waste

President Trump's New Executive Order: Deserves Praise and Raises Questions

The WasteWatcher

On September 24, President Trump announced a new Executive Order (EO), the “America-First Healthcare Plan.”  Section 1 of the EO laid out many policies that have already been implemented through regulation, guidance, or action by Congress that have been successful in lowering healthcare costs for citizens and protected them from the heavy hand of government control, like signing the law that repealed Medicare’s Independent Payment Advisory Board that would have turned the power to decide how to cut spending in the program over to unelected and unaccountable bureaucrats.

Other examples of good policies included in the EO are the Trump administration’s expanded use of short-term, limited-duration health insurance plans in 2018.  These plans are exempt from the Patient Protection and Affordable Care Act’s (ACA), or Obamacare, expensive mandates, and provide more affordable options for healthcare coverage.

In 2019, the Trump administration issued new rules on the use of health reimbursement arrangements (HRA), which are similar to health savings accounts.  HRAs help small businesses provide employer-funded tax-free accounts that their employees can use to pay for health insurance premiums or other medical expenses.

For the states, the administration released new guidance in 2018 allowing them to take greater advantage of ACA’s Section 1332 State Innovation Waivers.  By loosening restrictions that limited choice and flexibility, states were able to increase access to affordable health insurance in the private market, encourage innovation, while protecting those with pre-existing conditions.  As a result, many states saw their premiums drop, like Maryland where rates have fallen three years in a row in the ACA health exchange.  Wisconsin saw rates drop by 4.2 percent in 2019 and 3.2 percent in 2020 thanks to their reinsurance plan that was created under the Sec. 1332 waiver to stabilize the insurance market.  Currently, 15 states have implemented innovation waivers.

There is no question that through deregulation, President Trump has been successful in providing more choice, increased competition, and lowered healthcare costs for millions of Americans.  This includes signing into law the “VA Maintaining Internal Systems and Strengthening Integrated Outside Networks (MISSION) Act,” which gave our nation’s veterans more choice by allowing them to seek medical care from private healthcare providers.  His new EO promises to expand on using similar actions to improve healthcare for veterans.

The EO also tells the Secretary of Health and Human Services (HHS) to work with the Food and Drug Administration to speed up generic and biosimilar approvals, a policy CAGW strongly supports, and promote innovation in other areas like Alzheimer’s Disease, sickle-cell disease, and pediatric cancer. 

Unfortunately, the president has been imposing more heavy-handed measures with biopharmaceuticals in other areas that will give patients and medical professionals fewer choices and decreased cost savings in the long run.  They will hurt efforts to address the complex diseases like Alzheimer’s.  These polices include the adoption of Most Favored Nation prices for Medicare Part B and D drugs and reimporting drugs from other countries, including Canada.  These actions simply adopt those nations’ price controls, essentially validating government-run healthcare and raises concerns over drug safety.  The EO vows to build on these faulty ideas. 

Surprise billing occurs when a patient goes to their in-network facility for care but get a surprise bill from an out-of-network provider.  The EO allows HHS to act by December 31, 2020 if Congress fails to provide a solution for surprise billing.  CAGW agrees with the President’s four principles to address surprise billing laid out in a July 2020 report, “HHS Secretary Report On: Addressing Surprise Medical Billing.”  It is good policy to prevent patients receiving emergency care from being required to pay for extra costs not covered by their insurer and they should not receive surprise bills from out-of-network providers they did not choose.

CAGW was pleased that the administration’s report pointed out the problems with two of the most popular solutions being discussed on Capitol Hill to resolve surprise billing; rate-setting and independent dispute resolution (IDR).  Both utilize price controls and will cause a shortage of vitally need doctors and other healthcare personnel.  The question is what would the administration implement to fix the problem, and would it be legal for this to be done through executive action?

If there must be a federal solution, CAGW prefers that truth-in advertising claims be enforced through applicable laws and regulations combined with penalties, but it is our understanding that even this solution would require congressional action.

Although not referenced in the president’s EO, President Trump stated that the, “America First Healthcare Plan includes another historic provision to benefit our great seniors.  Under my plan, 33 million Medicare beneficiaries will soon receive a card in the mail containing $200 that they can use to help pay for prescription drugs.  Nobody has seen this before.  These cards are incredible.  The cards will be mailed out in coming weeks.”

Exactly how this would be paid for or accomplished remains a mystery and CAGW has been told the administration is still working on the details.  According to an article in the September 25, 2020 Wall Street Journal (WSJ) the card will be “funded by a Medicare trust fund … using money rarely spent on such pilot programs” even though one of the two trust funds held by the U.S. Treasury that pays hospital care, is expected to be insolvent by 2024, while the other is in better financial shape.  One option is for the administration to disburse the money via prescription discounts “under a program that lets officials waive Medicare’s laws or standards to test new initiatives” and these types of waivers have “generally been required to show they won’t increase federal spending beyond what would have occurred without the test.”  Supposedly the card will be used to test whether it helps Medicare beneficiaries stay compliant with their prescription schedules, thus keeping them out of doctor’s offices and hospitals.

With so little known about the cost and details, CAGW looks forward to learning more about the program.

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