Critics of President Trump’s response to the coronavirus crisis characterize it as knee-jerk, spur-of-the-moment, and grasping at any straw within reach. In fact, many of the executive actions we have seen in the past few days reflect a new approach to health policy that has been underway almost since the day Donald Trump was sworn into office.
These include the ability to be diagnosed and treated without ever leaving your own home; the ability to talk to doctors 24/7 by means of phone, email and Skype; and the ability of the chronically ill to have access to free diagnoses and treatments without losing their access to Health Savings Accounts.
In each of these areas, the Trump administration has already pushed the limits of executive authority. The “emergency” created by the coronavirus has given the administration the freedom to do much more.
Take telemedicine. In the private sector, the ability to deliver medical care remotely, say, by means of phone, email and Skype, is growing by leaps and bounds. It promises to lower costs, increase quality and lower the time and travel cost of patient care. Yet until recently Medicare rarely paid for any of this. Congress is the culprit.
Federal law (the Social Security Act) allows Medicare to pay for telemedicine only under strictly limited circumstances. For the most part, the law allows doctors to examine, consult with and treat patients remotely only in rural areas and even there, the patients can’t be treated in their own homes.
The Centers for Medicare and Medicare Services has been acting aggressively to change that. Under one rule change, Medicare Advantage plans and Accountable Care Organizations (ACOs) can bill Medicare if they consult with patients remotely to determine if they need an in-office visit. Patients can be anywhere, including their own homes.
How did Seema Verma (who administers Medicare and Medicaid) get away with these changes? By reclassifying these activities as “virtual medicine” instead of “telemedicine.” The communications are labeled “virtual check ins.”
Still, these are baby steps. The coronavirus created an opportunity for bolder action under the rubric of emergency authority. Medicare Advantage plans can now use telemedical devices to diagnose and treat anyone even suspected of having the virus, regardless of where they live.
The Trump administration is also suspending federal licensing regulations so that doctors who are licensed in any one state can deliver services to patients who reside in some other state. For the reform to be fully operational, governors need to use their emergency powers to suspend state-level restrictions as well.
A closely related set of reforms concern concierge care, or what is now more commonly called “direct primary care.” Coronavirus symptoms don’t occur just during working hours. But the ability to talk to a doctor by phone at any time – including nights and weekends – used to be a privilege available only to the very rich.
A model first developed by Atlas MD in Wichita, Kansas, has made round-the-clock care available to almost everyone. A mother, for example, can have full access to all primary care 24/7 for only $50 a month. A child costs an additional $10. With the spread of the coronavirus, demand for this kind of service is soaring and the administration has signaled the federal government will not stand in the way.
The administration has made two regulatory changes to facilitate the opportunity. First, enrollees can now get direct primary care services under Medicare. Second, employees can now use their Health Savings Accounts to pay the monthly fee for direct primary care. Neither option was allowed under the Obama administration.
A third development relates to Health Savings Accounts (HSA) regulations. More than 26 million people have an HSA and these accounts contain almost $62 billion in assets. Employees and their employers can make tax-free deposits to them and the balances grow tax-free. However, these tax advantages are only possible if the account is combined with a catastrophic health insurance plan that has an across-the-board deductible (currently $1,400 for individuals and $2,800 for families).
Say an employer with a diabetic employee encourages compliance with needed treatment by making certain drugs and monitoring devices free without charge. This makes good medical sense and good economic sense. But it would disqualify the HSA plan, since patients must spend up to their deductibles before getting services for free.
Last year, the administration relaxed the HSA rules to allow some chronic care to be provided without violating the high deductible requirement. A new IRS ruling solves the same problem for coronavirus detection and treatment. Considering that HSAs were created by an act of Congress, these executive actions are very aggressive.
A fourth development applies to health insurance generally.
In the Obamacare exchanges there appears to be a race to the bottom, as insurers try to attract the healthy and avoid the sick. They attract the healthy by keeping their premiums as low as possible. They repel the sick with high deductibles and very narrow provider networks. (Employers face these same perverse incentives but the response has not been quite as bad.)
President Trump has persuaded the major insurance company executives to orally agree to waive deductibles and copayments to encourage potential coronavirus victims to get tested and treated. The administration has also stretched its regulatory authority by defining coronavirus treatment as an “essential health benefit,” whose coverage is required by law. This is a salutary development. But going forward, public policy needs to address all the perverse incentives embedded in current law.
The final change concerns the kind of health insurance people have. In a dynamic economy people change jobs frequently and that is generally not a bad thing. But job changes typically mean changing your health insurance and that often means changing your doctor as well. For the chronically ill, continuity of care achieved by a continuing relationship with the doctors is usually better care.
Under a Trump administration reform, employers are now allowed to provide pre-tax dollars to employees who can buy their own health insurance. This ability of employees — to have personal and portable health insurance — is another huge change from the Obama years.
The public is not generally aware of how radically the Trump administration has been reforming health care because the mainstream media and even the health care media have not reported on it. That is unfortunate. Research by the Job Creators Network shows that these kinds of reforms are highly popular with voters.
If only they knew about them.