President Trump is throwing a preelection curveball aimed at seniors with a surprise announcement on Thursday that his administration will send $200 coupons to 33 million seniors on Medicare to use to pay for prescription drugs.
The move raises legal questions, given that Congress has not authorized the roughly $7 billion in spending, and Democrats and some health experts said it would be an unprecedented use of the Medicare program for political gain ahead of the election.
Trump made no effort to disguise the fact that he sees the move as a political benefit with seniors, a key voting bloc, ahead of the election.
“These cards are incredible,” Trump said during a health care speech in North Carolina. “The cards will be mailed out in coming weeks. I will always take care of our wonderful senior citizens. Joe Biden won’t be doing this.”
The White House did not provide a clear explanation for where the money for the program would come from. A White House official said Thursday evening that the spending would be offset by a program to lower drug prices by tying them to lower prices in other countries, a plan called “most-favored nation.” But that plan, while it has been proposed, has not gone into effect yet, meaning that there currently are no savings from it.
The Wall Street Journal then reported on Friday that the money would be coming from the Medicare Trust Fund, which appears to be a more realistic source of funds.
That idea drew a rebuke from Speaker Nancy Pelosi (D-Calif.).
“After failing to take real action to lower seniors’ prescription drug prices, President Trump wants to steal from the Medicare Trust Fund for a desperately transparent political gimmick,” she said in a statement. “The Administration’s claim to be using imaginary savings from non-existent drug price reforms means that Trump’s coupons come at Medicare’s expense, and that seniors and taxpayers are paying the price for this stunt.”
On a call with reporters about actions to lower drug prices on Friday, Department of Health and Human Services officials did not provide details when asked about the funding for the program, saying the White House would provide more information in the future.
Trump has made lowering drug prices a key part of his messaging for years, dating back to the 2016 campaign, but while his administration has made a range of proposals on the issue, from the “most-favored nation” program to allowing imports of cheaper drugs from Canada, it has not followed through to have any of its major initiatives go into effect yet.
“Very few of them, almost none of them have taken effect,” Juliette Cubanski, a Medicare expert at the Kaiser Family Foundation, said of the administration’s drug pricing proposals.
“So I think the administration is looking for a talking point as we run up to Nov. 3 to say that we’ve done something to bring prescription drug costs down,” she added.
For several months in 2019, White House staff was in talks with Pelosi’s staff about a possible deal on drug pricing legislation, but the talks eventually fell apart, and the White House ended up threatening to veto the legislation House Democrats passed to allow the secretary of Health and Human Services to negotiate lower drug prices.
An analysis from FiveThirtyEight this month found that Biden was up in polls among voters 65 and older by about 4 percentage points, a reversal from 2016, when Trump won that age group by 13.3 percentage points.
“He has to make sure he wins seniors in Florida,” GOP strategist Ford O’Connell said of Trump. “Florida and Arizona is where seniors are a big part of the vote.”
It is unclear when exactly the discount cards will actually begin going out, or whether logistical challenges could delay the move. HHS officials said on the call with reporters Friday that not all of the cards would be delivered before Election Day, and they will go out “as soon as it’s mechanically possible” over “the course of the next several months.”
The officials did not answer a question on the call about whether Trump’s name will be printed on the cards.
Drug pricing advocates also noted that one-time discount cards to be used for drug copays will not do anything to lower drug prices in the long term.
“Americans need systemic, enduring reforms to our rigged drug pricing system, not election year gimmicks,” said David Mitchell, founder of the advocacy group Patients for Affordable Drugs Now.
Democratic strategist Jesse Ferguson expressed some skepticism the discount cards would ever actually materialize. “Just because Donald Trump says he’s going to do something, it’s been pretty clear that doesn’t mean it will actually happen,” he said.
But even if they are mailed, he argued Trump’s failure to act on drug prices earlier, and his handling of the coronavirus pandemic, had already badly damaged his standing with seniors.
“It’s like an arsonist burning down a neighborhood who shows up with a bucket of water and tosses it on the last house,” he said.