The Trump Administration announced today that it intends to nominate Alex Azar as the next Secretary of Health and Human Services (HHS). Azar served at HHS under the George W. Bush Administration from 2001 to 2007, first as general counsel and deputy secretary. He served in senior leadership roles at Lilly USA between 2007 and late 2016.
The first HHS Secretary in the Trump Administration, Tom Price, resigned earlier this fall due to the fallout over his use of chartered flights.
A Washington Post/“60 Minutes” investigation, which aired this weekend, examined Rep. Tom Marino (R-PA) efforts to guide legislation that weakened the Drug Enforcement Administration’s ability to go after drug distributors, even as opioid-related deaths continue to rise.
Marino was the Administration’s nominee for the position of Drug Czar. He has withdrawn his name from consideration.
President Trump has also promised a major announcement about opioids next week.
Late Thursday, President Trump announced the Administration will no longer pay subsidies to health insurance companies that help pay out-of-pocket costs of low-income people. These plans were disclosed hours after the President issued an executive action yesterday to change the nation’s insurance system, including sales of cheaper policies with fewer benefits and fewer protections for consumers.
The Department of Health and Human Services said it will immediately end these monthly payments, a move that could push premiums as much as 15 to 20 percent higher and prompt more insurers to withdraw from the marketplaces altogether. It would cut approximately $7 billion in annual payments, which reimburse insurers for discounting deductibles and co-payments for the lowest-income enrollees, is grounds for insurers to back out of their federal contracts to even sell plans next year. Already, the Administration had been making the payments on a month-to-month basis, prompting complaints by insurers about a lack of certainty as they tried to plan ahead for 2018 and beyond.
The marketplaces are set to open for 2018 enrollment in two-and-a-half weeks and insurers are finalizing their offerings for 2018 now.
The Administration’s ability to actually make these payments, known as cost-sharing reductions (CSRs) was has already been in question due to a lawsuit filed by House Republicans filed back in 2014 against the Obama Administration.
In the suit, Republicans charged the Administration does not have the authority to make the CSR payments because Congress needed to appropriate the funding, and late last year, a federal judge sided with House Republicans. The ruling stated that the CSRs funding needs to be disbursed by Congress. Technically, this means that the Trump administration would have had to challenge that ruling in order to keep making the payments indefinitely.
Which is what Senators Lamar Alexander (R-TN.) and Patty Murray (D-WA) had been in talks to do for two months. They have been trying to work out a deal to appropriating the funding for 2018 and possibly 2019 to ensure stabilization in the marketplaces, but negotiations have been hampered over disagreements about how much state flexibility to inject into such a bargain. Conservative Republicans have been unwilling to pay CSRs without rolling back ACA regulations, and Democrats will not rollback any of the law’s consumer protections.
Today, President Donald Trump issued a presidential directive to broaden the development of business association health plans, ease restrictions on short-term medical insurance and expand employer health care reimbursement accounts. The memorandum starts the rulemaking process, which will forge the details of the plans’ requirements. The White House is attempting to expand access to health insurance policies that face fewer regulations after several defeats of ACA repeal this year.
The new regulatory push on adjusting health insurance offerings was signaled by the White House earlier this year but deferred by ongoing and eventually stalled legislative action on repealing and replacing the 2010 health care law.
The order does two important things.
First, it asks cabinet officials to look for ways to expand short-term, limited-duration insurance. These plans generally come with less coverage than health plans sold through the ACA’s individual market, but they have grown in popularity since the ACA’s passage — even though people who buy them face federal penalties because their coverage does not meet the ACA’s standards.
The Presidential memo urges regulators to reverse an Obama administration policy that capped the duration of short-term policies at three months. If that’s enacted, those policies could return to lasting up to almost a year in many states.
Secondly, the order directs agencies to ease rules that allow small businesses, and possibly individuals, to band together in arrangements called “association health plans.” Such arrangements do exist today in some capacity, but expanding them could cause legal headaches for the Administration.
Eric Hargan was officially confirmed by the Senate on a 57-38 vote yesterday afternoon.
Hargan’s confirmation comes at a crucial time for HHS, which has relied on career staffer Don Wright to lead the agency since Tom Price resigned as secretary on Friday. Secretary Price’s recent exit helped accelerate the consideration of HHS nominees. Hargan will likely serve as acting secretary until Price’s replacement is confirmed. No word on who will take that position.
Hargan has served in several roles at HHS before between 2003 and 2007, including Acting Deputy Secretary, before leaving government work to serve as a lawyer in Chicago. Hargan also served on the Trump transition team for HHS.