HEALTH CARE BRIEFING: GOP Faces Identity Crisis on Entitlements

Republican lawmakers spent much of the last four years rebranding as a working-class party, following then-President Donald Trump’s lead on things like immigration and tariffs and setting aside their push to cut spending on Social Security, Medicare and Medicaid.

But Trump’s campaign pledge to “save” safety-net programs has left conservatives with an identity crisis. With their party now in the minority, key GOP leaders want to bring back the push for entitlement changes that was a top priority under former House Speaker Paul Ryan (R-Wis.), but a younger generation of lawmakers is keen to follow through on Trump’s lead and to all but ignore budget deficits.

“He made it impossible for Republicans to discuss policies that involved slowing the growth of entitlement spending,” said Douglas Holtz-Eakin, president of the GOP-aligned American Action Forum, and a former Congressional Budget Office director and adviser on John McCain’s 2008 presidential campaign. “That was just not OK. And that had been one of their core principles of restoring budgetary sustainability.”

The path Republicans take could be pivotal on the campaign trail, where many conservatives hope to recast the party as friendlier to the working class. It may also alter the country’s long-term fiscal trajectory, as Social Security and health care spending are projected to rise as revenues are expected to stay flat, according to the Congressional Budget Office.

Social Security and major health care program spending totaled 53.2% of federal outlays in fiscal 2019, a figure that’s projected to increase to 77.9% by 2051, according to the CBO. Far sooner than that, Republicans will have to navigate negotiations over automatic cuts to Medicare set to take place in 2022.

“The House has been remade in Trump’s image,” Holtz-Eakin said. Senate Republicans, meanwhile, are led by Minority Leader Mitch McConnell (R-Ky.), who in October 2018 said entitlement spending is responsible for the rising federal deficit and debt. More importantly, Republicans broadly have recently stopped prioritizing spending reductions, regardless of their specific views, Holtz-Eakin said.

In 2017, Republicans proactively pushed for a Medicaid overhaul in their effort to repeal and replace the Affordable Care Act, including a measure that would institute a per-capita system that would reduce federal funding for Medicaid. But the tide turned against the proposal when Trump criticized it, Holtz-Eakin said. Trump publicly said the Republican plan may need more funding to be “generous.”

The health-care measure’s ultimate failure in the Senate, combined with Trump’s campaign promises to protect entitlements, forced fiscal conservatives to put their plans on the back burner, Holtz-Eakin said. Read more from Jack Fitzpatrick.

Happening on the Hill

Medicare Sequestration: The House plans to delay scheduled cuts to Medicare for another nine months with a Senate amendment to H.R. 1868 it is slated to vote on today under suspension of the rules, which bars amendments and limits debate. The bill would suspend, through Dec. 31, Medicare sequestration required under the 2011 Budget Control Act that reduces payments by a maximum of 2% annually.

The Senate amendment doesn’t include provisions from the House-passed version of the bill that would have averted another 4% Medicare cut under PAYGO rules automatically triggered by President Joe Biden’s $1.9 trillion American Rescue Plan Act. Senators amended and passed the bill 90-2 on March 25. For more, see the BGOV Bill Summary by Danielle Parnass.

Panel to Weigh Mental Health Care Access: The House Education and Labor Committee’s health panel will hold a hearing on expanding access to behavioral and mental health care on Thursday, according to a statement. The pandemic “has intensified challenges for the mental health care system and exposed existing inequities to accessing care,” the statement says. It credits the Affordable Care Act for expanding access to mental health-care services, but says participants in employer-sponsored coverage “still face obstacles.”

Biden Tells Lawmakers He’s ‘Open to Negotiate’ on Infrastructure: Biden said he is “prepared to negotiate” on his new infrastructure-focused economic plan, at the start of a meeting with a bipartisan group of lawmakers to discuss the $2.25 trillion proposal. “I think everyone acknowledges we need a significant increase in infrastructure; it’s going to get down to what we call infrastructure,” Biden said in the Oval Office yesterday. Republicans are favoring a much narrower plan focused on the more traditional elements of an infrastructure package, such as bridges, rather than elements such as strengthening the elderly care sector as Biden wants. Read more from Josh Wingrove.

  • Sen. Roger Wicker (R-Miss.), one of four GOP lawmakers in the Oval Office session along with four Democrats, said he was willing to broaden his definition of infrastructure for the bill, but drew the line at “home health care and things of that nature,” Bloomberg News reports.

The Coronavirus Pandemic

Whitmer Plea for More Shots Gets CDC Cold Shoulder: The Biden administration yesterday put Michigan Gov. Gretchen Whitmer (D) on notice that her plea for more Covid-19 vaccine to be sent to the state isn’t going to happen despite a surging Covid-19 outbreak there. Shutdowns are needed to control the spike in cases, not more vaccines, said Rochelle Walensky, the head of the Centers for Disease Control and Prevention in a briefing yesterday. White House Press Secretary Jen Psaki said separately the administration is “not in a place, nor will we be, where we take supply from one state to give them to another.” Read more from Fiona Rutherford.

  • The weekly death toll from Covid-19 in the U.S. rose for the first time since February, topping 7,000 for the period ending on Sunday. Fatalities are again averaging about 1,000 per day, data compiled by Johns Hopkins University and Bloomberg show. And infections have climbed for four straight weeks—the longest streak since November. Read more.

Low Efficacy of Chinese Vaccine Sows Concern: Concern is mounting that China’s Covid-19 vaccines are less effective at quelling the disease, raising questions about nations from Brazil to Hungary that are depending on the shots and the country’s own massive inoculation drive. While vaccines developed by Pfizer, Moderna, and even Russia’s Sputnik shot have delivered protection rates of more than 90%, Chinese candidates have generally reported much lower efficacy results. Research released Sunday showed the rate for Sinovac Biotech’s shot being deployed in Indonesia and Brazil was just above 50%. Read more from Bloomberg News.

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What Else to Know Today

Ending Cancer Deaths in Young Seen ‘Doable’: Cancer won’t be a death sentence for most young and otherwise healthy people if a new health research program proposed by Biden becomes reality. “I don’t expect to end all cancer deaths, but I think that eradicating a vast majority, especially in young and otherwise healthy people, I think that is doable,” said Ned Sharpless, director of the National Cancer Institute, said at the American Association for Cancer Research’s annual meeting. Read more from Jeannie Baumann.

U.S. Opposes Top Court Review of ACA Case: Health insurers who increased their premiums to make up for losses they incurred when the federal government stopped reimbursing them for decreasing insured individuals’ out-of-pocket costs may not recover the entire amount of the unpaid payments, the U.S. told the Supreme Court. This is the latest chapter in a dispute between the federal government and insurers who claimed they didn’t get everything they were promised when they agreed to go along with Obamacare’s plan to make coverage cheaper. Read more from Mary Anne Pazanowski.

Microsoft to Acquire Nuance for $19.6 Billion in Health-Care Bet: Microsoft is buying speech-recognition pioneer Nuance Communications in an all-cash deal valued at $19.6 billion, gaining artificial-intelligence technology aimed at helping doctors predict patients’ needs and upgrading hospitals’ digital record-keeping. Read more from Dina Bass and Liana Baker.

Former Lawmaker Joins Lobby Firm: Former Rep. John Fleming (R-La.) has joined the McKeon Group, a lobbying firm founded by former Rep. Howard “Buck” McKeon (R-Calif.), Megan Wilson reports. Fleming, a medical doctor who served in Congress from 2009 to 2017, most recently served as assistant to the president for planning and implementation in the Trump administration’s White House, functioning as the deputy chief of staff. In that role, his duties included managing a portfolio of military and national security issues and representing the chief of staff’s office in coronavirus task force matters.

Flemming’s “expertise in the medical, business, and defense sectors — combined with his insider perspective from decades of public service — make him an ideal addition,” the firm said in a release. He served in other roles in the Trump administration, including the deputy assistant secretary of health IT at the Department of Health and Human Services.

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With assistance from Megan R. Wilson

To contact the reporter on this story: Brandon Lee in Washington at blee@bgov.com

To contact the editors responsible for this story: Zachary Sherwood at zsherwood@bgov.com; Giuseppe Macri at gmacri@bgov.com; Michaela Ross at mross@bgov.com

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