The facts about Trump’s policy of separating families at the border

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“I hate the children being taken away. The Democrats have to change their law. That’s their law.”
— President Trump, in remarks to reporters at the White House, June 15

“We have the worst immigration laws in the entire world. Nobody has such sad, such bad and actually, in many cases, such horrible and tough — you see about child separation, you see what’s going on there.”
— Trump, in remarks at the White House, June 18

“Because of the Flores consent decree and a 9th Circuit Court decision, ICE can only keep families detained together for a very short period of time.”
— Attorney General Jeff Sessions, in a speech in Bozeman, Mont., June 7

“It’s the law, and that’s what the law states.”
— White House press secretary Sarah Huckabee Sanders, at a news briefing, June 14

“We do not have a policy of separating families at the border. Period.”
— Homeland Security Secretary Kirstjen Nielsen, on Twitter, June 17

The president and top administration officials say U.S. laws or court rulings are forcing them to separate families that are caught trying to cross the southern border.

These claims are false. Immigrant families are being separated primarily because the Trump administration in April began to prosecute as many border-crossing offenses as possible. This “zero-tolerance policy” applies to all adults, regardless of whether they cross alone or with their children.

The Justice Department can’t prosecute children along with their parents, so the natural result of the zero-tolerance policy has been a sharp rise in family separations. Nearly 2,000 immigrant children were separated from parents during six weeks in April and May, according to the Department of Homeland Security.

The Trump administration implemented this policy by choice and could end it by choice. No law or court ruling mandates family separations. In fact, during its first 15 months, the Trump administration released nearly 100,000 immigrants who were apprehended at the U.S.-Mexico border, a total that includes more than 37,500 unaccompanied minors and more than 61,000 family members.

Children continue to be released to their relatives or to shelters. But since the zero-tolerance policy took effect, parents as a rule are being prosecuted. Any conviction in those proceedings would be grounds for deportation.

We’ve published two fact-checks about family separations, but it turns out these Trumpian claims have a zombie quality and keep popping up in new ways.

In the latest iteration, Homeland Security Secretary Kirstjen Nielsen tweeted and then said at a White House briefing that the administration does not have “a policy of separating families at the border.” This is Orwellian stuff. Granted, the administration has not written regulations or policy documents that advertise, “Hey, we’re going to separate families.” But that’s the inevitable consequence, as Nielsen and other Trump administration officials acknowledge.

“Operationally what that means is we will have to separate your family,” Nielsen told NPR in May. “That’s no different than what we do every day in every part of the United States when an adult of a family commits a crime. If you as a parent break into a house, you will be incarcerated by police and thereby separated from your family. We’re doing the same thing at the border.”

Although we’ve fact-checked these family-separation claims twice, we hadn’t had the opportunity to assign a Pinocchio rating yet. We’ll do so now.

The Facts

Since 2014, hundreds of thousands of children and families have fled to the United States because of rampant violence and gang activity in El Salvador, Guatemala and Honduras. U.S. laws provide asylum or refugee status to qualified applicants, but the Trump administration says smugglers and bad actors are exploiting these same laws to gain entry. Nielsen says the government has detected hundreds of cases of fraud among migrants traveling with children who are not their own. President Trump says he wants to close what he describes as “loopholes” in these humanitarian-relief laws.

The Central American refugee crisis developed during President Barack Obama’s administration and continues under Trump. The two administrations have taken different approaches. The Justice Department under Obama prioritized the deportation of dangerous people. Once he took office, Trump issued an executive order rolling back much of the Obama-era framework.

Obama’s guidelines prioritized the deportation of gang members, those who posed a national security risk and those who had committed felonies. Trump’s January 2017 executive order does not include a priority list for deportations and refers only to “criminal offenses,” which is broad enough to encompass serious felonies as well as misdemeanors.

Then, in April 2018, Attorney General Jeff Sessions rolled out the zero-tolerance policy.

When families or individuals are apprehended by the Border Patrol, they’re taken into DHS custody. Under the zero-tolerance policy, DHS officials refer any adult “believed to have committed any crime, including illegal entry,” to the Justice Department for prosecution. If they’re convicted, that triggers deportation proceedings.

Illegal entry is a misdemeanor for first-time offenders, and a conviction is grounds for deportation. Because of Trump’s executive order, DHS can deport people for misdemeanors more easily, because the government no longer prioritizes the removal of dangerous criminals, gang members or national-security threats. (A DHS fact sheet says, “Any individual processed for removal, including those who are criminally prosecuted for illegal entry, may seek asylum or other protection available under law.”)

Families essentially are put on two different tracks. One track ends with deportation. The other doesn’t.

After a holding period, DHS transfers children to the custody of the Office of Refugee Resettlement (ORR) in the Department of Health and Human Services. They spend an average 51 days at an ORR shelter before they’re placed with a sponsor in the United States, according to HHS. The government is required to place these children with family members whenever possible, even if those family members might be undocumented immigrants. “Approximately 85 percent of sponsors are parents” who were already in the country “or close family members,” according to HHS. Some children have no relatives available and in those cases the government may keep them in shelters for longer periods of time while suitable sponsors are identified and vetted.

Adding it all up, this means the Trump administration is operating a system in which immigrant families that are apprehended at the border get split up, because children go into a process in which they eventually get placed with sponsors in the country while their parents are prosecuted and potentially deported.

ENOUGH of the misinformation. This Administration did not create a policy of separating families at the border. pic.twitter.com/y0uuYUkSEL

— The White House (@WhiteHouse) June 18, 2018

This is a question of Trump and his Cabinet choosing to enforce some laws over others. The legal landscape did not change between the time the Trump administration released nearly 100,000 immigrants during its first 15 months and the time the zero-tolerance policy took effect in April 2018.

What changed was the administration’s handling of these cases. Undocumented immigrant families seeking asylum previously were released and went into the civil court system, but now the parents are being detained and sent to criminal courts while their kids are resettled in the United States as though they were unaccompanied minors.

The government has limited resources and cannot prosecute every crime, so setting up a system that prioritizes the prosecution of some offenses over others is a policy choice. The Supreme Court has said, “In our criminal justice system, the government retains ‘broad discretion’ as to whom to prosecute.” To charge or not to charge someone “generally rests entirely” on the prosecutor, the court has said.

Katie Waldman, a spokeswoman for Nielsen, said the administration does not have a family-separation policy. But Waldman agreed that Trump officials are exercising their prosecutorial discretion to charge more illegal-entry offenses, which in turn causes more family separations. The Obama administration also separated immigrant families, she said.

“We’re increasing the rate of what we were already doing,” Waldman said. “Instead of letting some slip through, we’re saying we’re doing it for all.”

Waldman sent figures from fiscal 2010 through 2016 showing that, out of 2,362,966 adults apprehended at the southern border, 492,970, or 21 percent, were referred for prosecution. These figures include all adults, not just those who crossed with minor children, so they’re not a measure of how many families were separated under Obama.

“During the Obama administration there was no policy in place that resulted in the systematic separation of families at the border, like we are now seeing under the Trump administration,” said Sarah Pierce, a policy analyst at the Migration Policy Institute. “Our understanding is that generally parents were not prosecuted for illegal entry under President Obama. There may have been some separation if there was suspicion that the children were being trafficked or a claimed parent-child relationship did not actually exist. But nothing like the levels we are seeing today.”

Trump administration officials say they’re trying to keep parents informed about their kids.

But some families instead have wound up in wrenching scenarios.

“Some of the most intense outrage at the measures has followed instances of parents deported to Central America without their children or spending weeks unable to locate their sons and daughters,” The Washington Post’s Nick Miroff reported. “In other instances, pediatricians and child advocates have reported seeing toddlers crying inconsolably for their mothers at shelters where staff are prohibited from physically comforting them.”

Administration officials have pointed to a set of laws and court rulings that they said forced their hand:

  • A 1997 federal consent decree that requires the government to release all children apprehended crossing the border. The “Flores” consent decree began as a class-action lawsuit. The Justice Department negotiated a settlement during President Bill Clinton’s administration. According to a 2016 decision by the U.S. Court of Appeals for the 9th Circuit, the Flores settlement requires the federal government to release rather than detain all undocumented immigrant children, whether they crossed with parents or alone. The agreement doesn’t cover any parents who might be accompanying those minors, but it doesn’t mandate that parents be prosecuted or that families be separated. Moreover, Congress could pass a law that overrides the terms of the Flores settlement. Waldman said the Flores settlement requires the government to keep immigrant families together for only 20 days, but no part of the consent decree requires that families be separated after 20 days. Courts have ruled that children must be released from detention facilities within 20 days under the Flores consent decree, but none of these legal developments prevents the government from releasing parents along with children.
  • A 2008 law meant to curb human trafficking called the Trafficking Victims Protection Reauthorization Act (TVPRA). This law covers children of all nationalities except Canadians and Mexicans. Central American children who are apprehended trying to enter the United States must be released rather than detained under the terms of the TVPRA, and they’re exempt from prompt return to their home countries. The law passed with wide bipartisan support and was signed by a Republican president, George W. Bush. No part of the TVPRA requires family separations.
  • The Immigration and Nationality Act of 1952. This comprehensive law governs U.S. immigration and citizenship and makes a person’s first illegal entry into the United States a misdemeanor. Clinton, Bush and Obama — the presidents who were in office during the immigration boom of the past few decades — never enforced the INA’s illegal-entry provision with the Trump administration’s zeal. The INA says nothing about separating families. It was sponsored by Democrats and passed by a Democratic-held Congress. President Harry Truman, also a Democrat, tried to veto the bill, describing it as a reactionary and “un-American” measure meant to keep out immigrants from Eastern Europe. Congress overrode his veto.

“What has changed is that we no longer exempt entire classes of people who break the law,” Nielsen said at a White House briefing June 18. “Everyone is subject to prosecution.”

It’s unclear whether 100 percent of adults are being prosecuted. Experts on the ground say there are not enough resources on the border to process all these cases. Trump administration officials say immigrants should show up at a port of entry to request asylum if they want to avoid prosecution, but there’s usually a big crowd and people often get turned away at these entry points, according to reporting from Texas Monthly.

It’s strange to behold Trump distancing himself from the zero-tolerance policy (“the Democrats gave us that law”) while Nielsen claims it doesn’t exist (“it’s not a policy”) and Sessions defends it in speech after speech.

“We do have a policy of prosecuting adults who flout our laws to come here illegally instead of waiting their turn or claiming asylum at any port of entry,” Sessions said in a speech on June 18 in New Orleans. “We cannot and will not encourage people to bring children by giving them blanket immunity from our laws.”

In a June 7 speech, he said: “I hope that we don’t have to separate any more children from any more adults. But there’s only one way to ensure that is the case: it’s for people to stop smuggling children illegally. Stop crossing the border illegally with your children. Apply to enter lawfully. Wait your turn.”

The attorney general also suggested on June 7 that legal developments are forcing his hand. “Because of the Flores consent decree and a 9th Circuit Court decision, ICE can only keep families detained together for a very short period of time,” he said. But as we’ve explained, this is misleading. Neither the consent decree nor the court ruling forces the government to separate families. What they do provide is accommodations for children that the government could extend to parents if it wanted to.

For Trump, the family-separation policy is leverage as he seeks congressional funding for his promised border wall and other immigration priorities, according to reporting by The Washington Post. Top DHS officials have said that threatening adults with criminal charges and prison time would be the “most effective” way to reverse the rising number of illegal crossings.

The Pinocchio Test

The doublespeak coming from Trump and top administration officials on this issue is breathtaking, not only because of the sheer audacity of these claims but because they keep being repeated without evidence. Immigrant families are being separated at the border not because of Democrats and not because some law forces this result, as Trump insists. They’re being separated because the Trump administration, under its zero-tolerance policy, is choosing to prosecute border-crossing adults for any offenses.

This includes illegal-entry misdemeanors, which are being prosecuted at a rate not seen in previous administrations. Because the act of crossing itself is now being treated as an offense worthy of prosecution, any family that enters the United States illegally is likely to end up separated. Nielsen may choose not to call this a “family separation policy,” but that’s precisely the effect it has.

Sessions, who otherwise owns up to what’s happening, has suggested that the Flores settlement and a court ruling are forcing his hand. They’re not. At heart, this is an issue of prosecutorial discretion: his discretion.

The Trump administration owns this family-separation policy and its spin deserves Four Pinocchios.

Four Pinocchios

by Salvador Rizzo/WAPO
Posted by The NON-Conformist
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U.S. and China announce new tariffs in escalation of trade war

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President Trump followed through Friday on his threat to crack down on China for its “very unfair” trade practices, imposing a 25 percent tariff on $50 billion in Chinese imports.

Beijing quickly responded. In a late-night statement, China’s Ministry of Commerce said it would impose trade barriers of the “same scale and the same strength.”

The Chinese government said Trump’s tariffs were “damaging” relations and “undermining the world trade order.”

U.S. and Chinese officials in recent weeks had made progress on a deal that involved up to $70 billion in additional purchases of American products. But the Chinese offer was now “invalid,” the statement said.

Chinese officials, who had signaled their intention to retaliate if Trump went through with his tariff threats, are targeting the president’s supporters in farm states and the industrial Midwest.

Anticipating the Chinese response, the president said the United States would “pursue additional tariffs,” raising the specter of the tit-for-tat trade war that business leaders and many congressional Republicans fear.

In a short White House statement, the president said the import tax would apply to “goods from China that contain industrially significant technologies.”

Friday’s action follows an administration report in March that complained China had forced foreign companies to surrender their technology secrets in return for market access and had pilfered other advanced U.S. technologies through a campaign of cybertheft and investment in Silicon Valley start-ups.

“These practices . . . harm our economic and national security and deepen our already massive trade imbalance with China,” Trump said.

The United States last year ran up a $375 billion deficit in goods trade with China, a figure the president blames on Chinese trade barriers. Most economists say the gap is the result of broader forces such as Americans’ low savings rate.

On April 6, the administration published a proposed list of 1,333 products targeted for tariffs. After hearing objections from business groups, U.S. Trade Representative Robert E. Lighthizer dropped 515 items and added 284 new ones.

As a result, the tariffs will be imposed in two steps. On July 6, customs officers will begin collecting the tax on an initial basket of goods valued at $34 billion, which were on the initial list. The Office of the U.S. Trade Representative (USTR), meanwhile, will field comments on the new items on the list, valued at $16 billion.

“These tariffs are essential to preventing further unfair transfers of American technology and intellectual property to China, which will protect American jobs,” the president said.

USTR also plans to establish a process for U.S. companies to request permission to continue importing the targeted items on a duty-free basis, if no alternative suppliers exist.

The Chinese government is pursuing a $300 billion program of subsidies to enable its companies to dominate next-generation technologies such as artificial intelligence, robotics and quantum computing, upping the stakes for Trump’s efforts to preserve U.S. technological secrets.

China has a history of targeting industries such as steel or solar energy for growth, which results in excessive investment by its state-led firms. That, in turn, swamps global markets, driving prices to unsustainable levels and making it all but impossible for private companies to compete, a senior administration official said.

Unless the United States can somehow force China to change its industrial policies, American companies will lose out in a range of advanced technology markets, the official said.
“This is not market capitalism,” the official said, speaking anonymously to brief reporters. “These are state policies where they are targeting certain industries.”
Trump’s complaints about China’s trade practices are shared by many business leaders. But there is little support for using import taxes, which are paid by Americans, as a tool against the Chinese.
“Imposing tariffs places the cost of China’s unfair trade practices squarely on the shoulders of American consumers, manufacturers, farmers and ranchers. This is not the right approach,” said Tom Donohue, president and chief executive of the U.S. Chamber of Commerce.
The U.S. announcement comes at a complex juncture in U.S.-China relations.
Following a summit in Singapore between Trump and North Korean leader Kim Jong Un, Secretary of State Mike Pompeo stopped in Beijing for meetings with President Xi Jinping and other top Chinese leaders.

On Thursday, Pompeo thanked Xi for China’s help with North Korea and even wished the Chinese president a happy birthday.

But at a news conference with China’s foreign minister, Wang Yi, tension over trade was clear. Pompeo said the U.S. trade deficit with China is still too high, and Wang called for Washington to make a “wise choice” on tariffs.

After Trump’s statement Friday, Lu Xiang, a trade expert at the Chinese Academy of Sciences in Beijing, warned that relations between the two countries were heading to their lowest point since China began its economic reforms in the late 1970s.

“This is like holding up a pistol, putting the finger on the trigger,” he said of Trump’s actions. “It’s just one step away from pulling the trigger and firing the pistol. It’s a very dangerous and sensitive moment now.”

by David J. Lynch and Emily Rauhala/WAPO

Posted by The NON-Conformist

Obamacare Critics and Defenders Team Up Against the Trump Administration’s Refusal to Defend the Health Law in Court The DOJ’s argument for striking down the health law’s preexisting conditions rules is weak.

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Last week, in response to a legal challenge filed by Texas and a group of conservatives states, the Trump administration took an unusual step by announcing that it would not defend Obamacare in court. Instead, the Trump administration took the position that the health law’s was unconstitutional, and that its preexisting conditions regulations should be struck down.

The federal government’s suit has drawn rebuke from some unlikely quarters. An attorney with 20 years of experience at the Justice Department resigned this week as a result of the administration’s position. Sen. Lamar Alexander (R-Tenn.) said it was “as far-fetched a legal argument as I think I’ve ever heard.” Senate Majority Leader Mitch McConnell distanced his party from the argument, saying that “everyone” in the Senate favored maintaining coverage for people with preexisting conditions.

Even Health and Human Services (HHS) Sec. Alex Azar, who signed the brief in question, described it as a “constitutional and legal position, not a policy position.”

It doesn’t appear to be much of one.

Among the more unusual responses to the administration’s argument came today in the form a brief filed by five academic experts with wildly divergent views about Obamacare. The brief is signed by Jonathan Adler, Nicholas Bagley, Abbe Gluck, Ilya Somin, and Kevin Walsh. Bagley and Gluck have both defended the health law’s legality in the past. Walsh has published several analyses of the legal arguments surrounding Obamacare. But Adler and Somin, notably, are libertarian-leaning law professors who have been quite critical of the health law over the years. (Both are also contributors to the Volokh Conspiracy, which is published at Reason.com.)

The opening of the brief stresses that the signers have spent the last several years disagreeing with each other, in some cases quite forcefully, about the legal and constitutional merits of the health law. The brief takes no position on the mandate itself. But in this case, they all agree that the federal government’s argument for striking down the law’s preexisting rules is, legally speaking, pretty terrible.

Understanding the brief requires a little bit of background. In 2012, the Supreme Court ruled that although Obamacare’s mandate was unconstitutional when viewed as a purchase requirement or economic command, it could stand because it raised revenue and therefore functioned as a tax. But last year, as part of tax reform legislation, Congress eliminated the penalty for not complying with Obamacare’s individual mandate. The mandate remained on the books, but for all practical purposes it had been repealed. And it no longer raised any revenue.

As a result, a group of conservative states, led by Texas, challenged the legality of the (now unenforceable) mandate, and further argued that because it is the centerpiece of the health law, all of Obamacare should be struck down.

This is an argument about what’s known as “severability” — whether the remaining parts of a law should be struck down if a court finds one provision to be illegal.

The Trump administration’s argument does not go quite as far as the states. It agrees that the mandate is now unconstitutional, and takes the position that although much of the law, including the Medicaid expansion and private insurance subsidies, can stand, the preexisting conditions rules should be tossed along with the mandate, because the mandate and the preexisting conditions rules are not severable. To back up its argument, the administration cites findings associated with the statute of Obamacare (that were also cited by the Obama administration in court) declaring that the mandate and the preexisting conditions rules are a bundle that should not be separated.

For critics of Obamacare, there is something naturally appealing about this argument: It uses the text of the health law, and the Supreme Court’s decision to uphold it, to attempt to knock it down. I have been open to arguments along these lines under the Obama administration, and I think they made sense at the time.

The problem, as the new brief points out, is that determining severability is about determining congressional intent. And the current Congress has made its position on the matter quite apparent. Often, this requires some sort of guessing. But at this point, we know exactly what Congress thinks about the law it chose to amend, because it very clearly chose to eliminate the mandate penalty while leaving the preexisting conditions rules in place. That is about as clear a statement of intent as you can ever imagine from Congress.

The brief argues that the administration’s argument relies on “time shifting” to make its case, and that the administration’s case effectively gets severability backward by “[disregarding] the clearly expressed intent of Congress and seek judicial invalidation of statutory provisions that Congress chose to leave intact.”

The findings about severability that the administration cites to back up its arguments about the preexisting were made by a different Congress, prior to the elimination of the mandate penalty and other alterations to the law. They were made in the context of what is now, essentially, a different law. They don’t apply.

I have been a critic of Obamacare for years, and I continue to believe there are many problems with the law. The preexisting conditions rules, while popular, distort the individual market and have contributed to rising premiums in the exchanges. (The popularity of those rules, of course, is one reason why Republicans haven’t touched them, and why GOP officials are distancing themselves from the policy implications of their argument.) But critics of the health law do themselves no favors by signing on to a fundamentally weak legal challenge like this.

The bigger problem with this case is that it has the potential to serve as a substitute for a policy agenda. Republicans still need a broad health policy vision that goes beyond simply attacking Obamacare. But as long as they are basing their hopes on a legal manuever as poorly thought out as this one, that’s not something we’re likely to see.

By Peter Suderman/reason

Posted by The NON-Conformist

Sears To Close Another 72 Stores As Sales Continue To Plunge

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Sears will close another 72 stores as sales plunge and losses grow. The beleaguered retailer said that it has identified about 100 stores that are no longer turning a profit, and the majority of those locations will be shuttered soon. Sears lost $424 million, or $3.93 per share, for the period…

via Sears To Close Another 72 Stores As Sales Continue To Plunge — CBS Dallas / Fort Worth

Posted by Libergirl

Louisiana warns 37,000 Medicaid recipients they may face loss of care over budget cuts

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Louisiana lawmakers made deep cuts to the proposed budget to make up for a $650 million shortfall, which could end a temporary tax funding Medicaid benefits. The governor also warned that both of the state’s medical schools might have to close and that several big hospitals may have to lay off staffers.

For Jamie Duplechine, a quadriplegic who has spent more than half of her 38 years in a wheelchair, it’s an endless source of amusement that three of the caregivers who watch her around the clock in her Louisiana apartment just happen to be named Shonda, Shamanda and Sherry.

Image: Shonta Faulk uses a harness to get Jamie Duplechine into bed

Image: NBC News

Karen Scallan is also on a first name basis with the caregivers who come to her suburban New Orleans home to help her take care of her 17-year-old son, who has Down syndrome — and free her up so she can work and take care of her 63-year-old husband, who suffers from diabetes and Alzheimer’s disease.

So when the letter arrived this week warning them that they were at risk of losing their health care services starting on July 1 because of their state’s budget crisis, they reacted the same way — with dread.

“I have staff with me throughout the day and night,” Duplechine, who was paralyzed at age 15 in a car accident, told NBC News. “They do my hygiene, my catheter care, my bowel care. They cook my meals, they bathe me, they drive me everywhere. Without them, I’m in a devastating state.”

 

More sadness at NBC News

Posted by Libergirl

Seattle Passes Tax on Big Firms to Ease Housing Crisis

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amazonshutterstock 373709401

Image: OZY

They’re hitting Amazon close to home. The company, Seattle’s largest employer, had threatened to stop construction on a downtown tower if the city passed a planned $500-per-employee tax. Many point to the rise of huge international companies like Amazon and Starbucks as the cause of Seattle’s rising house prices and increased homelessness. In the end, the city council scaled back: Its new tax costs companies $275 per worker, and the anticipated $48 million a year in funding will go toward building affordable housing and battling homelessness

More@ OZY

Posted by Libergirl

Big Pharma Gets a Big Win From Trump The president campaigned on stinging criticisms of the pharmaceutical industry and promises to use Medicare to lower drug prices. But none of that materialized in his drug-pricing speech this week.

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President Trump shakes hands with Health and Human Services Secretary Alex Azar after delivering a speech on prescription-drug prices.President Trump shakes hands with Health and Human Services Secretary Alex Azar after delivering a speech on prescription-drug prices.

During the 2016 presidential campaign, one candidate famously claimed that drug companies were “getting away with murder”—using armies of lobbyists to influence Congress and artificially inflating drug prices.

But a lot can change in two years. That candidate was Donald Trump, who aggravated fellow Republicans on the trail with his forceful and blunt criticism of the pharmaceutical industry. Taking a page from the Democrats, he embraced a plan to allow Medicare to negotiate directly with drug manufacturers, promising that such a scheme could save hundreds of millions of dollars and reduce drug prices. When he was asked why the plan, which has circulated around Capitol Hill for about 15 years, hadn’t yet passed Congress, Trump said without reservation that it was all drug companies’ fault.

The industry is now having the last laugh. In a speech Friday on drug pricing, President Trump completed his 180-degree turn on Candidate Trump’s promises. The White House’s new plan, as outlined, does seek to address high prescription-drug costs. “We will not rest until this job of unfair pricing is a total victory,” Trump said. But it doesn’t directly challenge the pharmaceutical industry and the direct role it plays in setting prices. Indeed, the new policy largely meets the goals of big pharma, signaling an ever-tightening bond between Trump and drug manufacturers.

One of the major pieces of the plan that Trump outlined Friday is an ongoing effort to change the federal government’s 340B Drug Pricing Program, which provides rebates to hospitals that treat a high share of Medicaid and uninsured patients. Those rebates are intended to lower the cost of care by forcing drug manufacturers to provide medications—especially high-cost drugs for chronic conditions—at cheaper prices to the neediest populations. But the $18 billion 340B program has been the setting for a war between drug manufacturers, who claim hospitals are simply pocketing the savings and not passing them on to patients, and the hospitals themselves. They claim drug manufacturers aren’t actually lowering prices, and instead are using the rebates as an excuse to increase their list prices.

In a policy document released Friday, the White House described its commitment to requiring that safety-net hospitals “use their 340B drug discounts to provide care to more low-income and vulnerable patients.” But an earlier move from the administration undercuts that commitment. Late last year, the Centers for Medicare and Medicaid Services slashed the 340B program to the tune of somewhere between $900 million to $1.65 billion, effectively siding with drug manufacturers who say the rebates aren’t worthwhile.
Trump also seemed to take aim at a longtime industry foe in his speech: pharmacy benefits managers, or PBMs. PBMs function as industry middlemen, administering the prescription-drug programs for large insurance programs covering the majority of Americans. These companies handle negotiations between insurers and drug manufacturers on drug prices, including managing rebates from manufacturers that are designed to entice insurers into accepting certain medications on their plans. Drug manufacturers argue that PBMs have wrangled too-high rebates that they keep to themselves instead of passing on to consumers.
In its policy document, the White House vaguely committed to “requiring Pharmacy Benefit Managers to act in the best interests of patients.” Trump was much more forceful in his remarks. “We’re very much eliminating the middlemen,” Trump said, apparently referring to PBMs. “The middlemen became very, very rich.”

Drug companies argue that limiting the 340B discounts and PBM rebates will reduce the consumer costs, especially for elderly people receiving their health care through Medicare Part D. But on that front, Trump has also walked back a major campaign pledge: allowing Part D to negotiate directly with insurers to lower costs of the drugs it offers. Trump said in his speech Friday that “we will have tougher negotiation,” and the policy blueprint released by the White House pushes for “allowing greater flexibility in benefit design to encourage better price negotiation.” But that policy doesn’t seem likely to affect the baseline negotiating capacity of the program: Congress would probably need to pass legislation to allow the health and human-services secretary to make deals with drug companies. Without that legislation in place, Trump has little executive authority to change anything.

While Trump did outline support for a Medicare program that would limit out-of-pocket spending on drugs, that reform seems similarly toothless. That’s because it would have little to do with actual drug prices. Instead, it would increase the amount that Medicare would pay for some seniors’ drugs, in effect shifting more tax dollars toward hiding the true costs of care for consumers.

Perhaps the most impactful set of policies that Trump outlined—and that he actually has the power to pursue—involve what he calls “putting American patients first”: intervening in an escalating drug-price war and increasing research-and-development competition between domestic drug companies and international drug companies. International competition has long been a major focus of drug lobbying, as manufacturers in the United States claim they shoulder most of the burden of research, while price-setting in other countries means they don’t reap commensurate global profits. In response, Trump promised to release a comparison of global drug prices. He also pledged to change drug-patenting and Food and Drug Administration regulation to enhance domestic research and expand the ability of pharmaceutical companies to keep effective monopolies over their drugs.

In all, while the president promised “the most sweeping action in history to lower the costs of prescription drugs for the American people,” the policies described Friday seem somewhat marginal, and none address the actual prices pharmaceutical companies are charging.

Trump seemed to frame his remarks, as well as the new policy outline, as a continued rebuke of the industry, saying “the drug lobby is making an absolute fortune at the expense of American consumers.” But that rebuke falls especially flat this week, given the still-unfolding story that pharmaceutical giant Novartis paid his personal attorney Michael Cohen $1.2 million to gain a better understanding of the president’s health-care policy.

Trump’s policy seems to fall pretty much in line with what Novartis and other pharmaceutical companies have lobbied for years to get. With health secretary and former Eli Lilly president Alex Azar on board to fill in the details, the president outlined a plan that validated longtime drug-industry critiques of Part D payments, rebates, and PBMs. The plan shifts more government money toward obscuring the list prices of manufacturers’ drugs, and takes a protectionist stance on American companies. President Trump calls his plan “American patients first,” but the interests of American pharmaceuticals may be taking priority.

By Vann R. Newkirk II/TheAtlantic

Posted by The NON-Conformist

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