White House not totally sure how it's going to pay for these new $200 gift cards for senior citizens

White House not totally sure how it's going to pay for these new $200 gift cards for senior citizens

In fairness to Trump, America is many decades deep into its “do stuff and worry about how to pay for it later” stage of decline.

If anything, this $6 billion bribe he’s offering to seniors to try to buy them off on Election Day seems charmingly modest in its magnitude. America’s looming entitlement crisis is really just a mega-trillion-dollar version of this gift-card thing, no?

It made me laugh to think how the idea must have come about, though. If you read this story last weekend, you know that the White House recently spent weeks negotiating with drug companies on a deal that would lower prescription drug costs before the election. That would have been worth $150 billion, a coup for a president who’s scrambling for ways to woo retirees back into his column. They got close to an agreement but then the deal collapsed — allegedly because the White House insisted that it include $100 gift cards funded by the pharmaceutical industry to be sent out to seniors before Election Day. It was, essentially, an out-and-out cash bribe to be paid by a third party in hopes of getting Trump elected.

The drug companies balked, fearing how it would look to have them paying off voters on Trump’s behalf so soon before polls opened. White House sources told the Times that, yes, okay, a request involving gift cards was made, but that wasn’t the real reason the deal fell through. But the fact that the White House is now trying to revive the gift-card idea — this time using your and my money to fund the cards, which will be twice as lucrative as under the pharma deal — suggests that yes, the cards really were a sticking point in that negotiation. And how could it be otherwise? It’s very “Manhattan real-estate mogul” to consider bribery as a solution to a problem, and the insistence on conveying the bribe in a physical form lends it a showman’s flair. Anyone can pass an abstract $150 billion program, but how many pols will mail you something so that you know where your money’s coming from?

White House aides told the Times last week that they weren’t planning to emblazon the Trump name on the gift cards funded by drug companies before that deal collapsed. We’ll see what happens with these new cards. As for funding, one would think that an outlay of $6 billion for health care might require an appropriation from Congress, but again, at this stage of decline we don’t sweat the niceties. The important thing was to announce this political stunt. Figuring out how to fund it — and letting major players know what you were planning to do — was mere fine print:

At one major drug firm, the company’s government relations staff watched the speech on television and attempted to figure out what the president was talking about. At another major health-care company the scene was similar — they had no idea what the program was, how it would work, if it was legal, or where the money would come from.

Spokespeople for the industry’s two largest trade organizations, Pharmaceutical Research and Manufacturers of America and the Biotechnology Innovation Organization, said the groups haven’t been given any additional information on the plan.

Pharmacy benefit managers, which administer Medicare drug plans, also have questions about the drug cards, said Greg Lopes, a spokesman for the Pharmaceutical Care Management Association, in an email.

According to Lopes, these questions include: When will the cards be mailed? Which Medicare beneficiaries will get them? What authority will they be issued under? And how are drug manufacturers paying for them, given that the program cited as off-setting the cost is “years away from implementation.”

An administration source told the Wall Street Journal this afternoon that they’re going to use one of the two trusts that funds Medicare to pay for the gift cards. (One of those trusts is already under financial strain due to extra hospitalization costs incurred due to the pandemic.) As for legal authority, apparently existing rules allow HHS to dip into the trusts when they want to test new Medicare initiatives, such as measures that might improve the program’s efficiency. But those are “fairly uncommon and small-scale,” the Journal claims, and normally HHS is required to show that they won’t increase federal spending overall. An exec at the Kaiser Health Foundation says “it’s just unprecedented” for the feds to use that exception for something like gift cards instead. But the White House knew there was no chance they’d get the money from Congress, so it seems they simply twisted the existing regs to make it happen.

Worst/funniest of all, the big proponent of this idea inside the White House is reportedly Mark Meadows. A thousand years and many lifetimes ago, Meadows was such a hard-ass fiscal conservative that he was leader of the Freedom Caucus. Now he’s raiding the Treasury to bribe voters and calling it “efficiency.” The White House told Stat yesterday that they do have a way of making this revenue-neutral, namely, that the executive order Trump signed a few weeks ago pegging U.S. drug prices to European ones will create savings offsetting the $6 billion for the cards. But as Stat pointed out, “That regulation has not yet been implemented — meaning the Trump administration is effectively pledging to spend $6.6 billion in savings that do not currently exist.”

This story is a reminder that while Trump is often accused (rightly) of being mercurial and unpredictable, there’s one thing he’s strikingly consistent about. “Everything, every decision, was made based on his re-election as opposed to what’s good for the country,” said one former senior official to Time magazine recently. That was the core criticism John Bolton leveled at him too, that every aspect of foreign policy — including the “perfect” phone call with Ukraine’s president — was geared towards his electoral benefit. Olivia Troye said the same thing recently about how Trump approached the pandemic. If it wasn’t clear enough from his early push to reopen because he wanted to get the Dow ticking upward again, it’s abundantly clear lately from his insistence on pre-election approval of a COVID vaccine. Sending gift cards to seniors is another glaring example. All presidents factor reelection into their policy decisions, but there’s barely even a pretext of a serious policy reason for today’s move. It’s just a straight-up election bribe.

Which brings us to an exit question: If he wants to bribe voters, why isn’t he bludgeoning Senate Republicans until they make a deal with Pelosi on the coronavirus stimulus? Dems want to send a new round of $1,200 checks to voters to help keep them afloat. Republicans, having recently resumed pretending that they’re fiscally conservative, have balked. I can’t understand why Trump would go all-in on the gift cards but not raise holy hell about the stimulus checks so that he can take credit for them on the stump. Why is he letting a bunch of phony deficit hawks in the Senate undermine his election chances? Go big with the bribery and help yourself win!

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