|THIS WEEK IN HEALTHCARE
What happened in healthcare this week—and what we think about it.
President Trump releases his budget and suffers a loss in court
This week, the Trump administration unveiled its $4.8T federal budget for the upcoming fiscal year, including major cuts to spending on healthcare programs. Rather than proposing specific spending cuts, however, the President’s budget calls for Congress to put forward plans to “advance the President’s health reform vision”—which presumably includes the administration’s recent proposal to allow states to partially convert Medicaid to a block-grant structure—with promised savings of $844B over the coming decade. Coupled with additional proposals targeting specific changes to Medicaid reimbursement (including further implementation of work requirements for Medicaid enrollees) and reductions in subsidies for Affordable Care Act (ACA) marketplace consumers, the budget envisions a total of $1T in healthcare cuts over the next 10 years. Complicating the administration’s vision for Medicaid transformation, however, a federal appeals court on Friday unanimously ruled that the version of Medicaid work requirements proposed by Arkansas is unlawful, because it does not further the statutory purpose of the Medicaid program. Although the ruling does not impact work requirements programs elsewhere, it does cast a shadow over the administration’s larger attempt to encourage states to implement such policies. Like the broader fate of the ACA, the future of Medicaid work requirements will ultimately lie in the hands of the US Supreme Court. The President’s budget, however, will face immediate opposition in Congress, where House Speaker Nancy Pelosi (D-CA) called it “a complete reversal of the promises [President Trump] made in the campaign and a contradiction of the statements he made in the State of the Union.” As the general election approaches, voters will eventually have to choose between the conservative vision for healthcare underpinning the President’s budget, and progressive proposals being advanced by Democratic candidates. With healthcare being the number one issue on the mind of the electorate, that choice could not be more stark.
The Sanders campaign faces worrisome criticism on M4A
Newly minted Democratic frontrunner Sen. Bernie Sanders found himself crossways with a key constituency—organized labor—as the contest for the party’s nomination continued to evolve this week. The head of the influential Nevada Culinary Workers Union, a pivotal player in the upcoming Nevada caucuses and a major force in Democratic politics in the tourism-focused state, expressed concern that Sanders’ proposal for Medicare for All (M4A) could jeopardize the hard-won private health benefits that are a key component of the union’s value proposition to its members. The union sent out flyers to its 60,000 members this week claiming that the M4A proposal would “end culinary healthcare”, earning the swift approval of Sanders’ moderate rivals—particularly Minnesota Sen. Amy Klobuchar and former South Bend, IN mayor Pete Buttigieg, who have surged into the lead in the campaign’s “moderate lane” in the wake of this week’s New Hampshire primary. Meanwhile, a top Sanders surrogate admitted in an interview that his signature M4A proposal is unlikely to be implemented, given the political makeup of Congress. Rep. Alexandria Ocasio-Cortez (D-NY) told HuffPost that the “worst-case scenario” is that “we compromise deeply and we end up getting a public option. Is that a nightmare? I don’t think so.” That nod toward political reality was likely intended to broaden Sanders’ appeal with voters, who have turned increasingly negative on the idea of M4A, worried (like Nevada’s culinary workers) that it could mean losing their private insurance. But it could wind up alienating Sanders’ base; establishing a government-run “public option” as a fallback position was not a successful strategy for Sanders’ progressive rival Sen. Elizabeth Warren, who saw her poll numbers drop after attempting to pivot to the more moderate approach. The public option is supported by the rest of the Democratic field, however, and is increasingly popular among voters. It will be worth watching the results of next Saturday’s Nevada caucus, to see what the future holds for Sanders, and for the idea of Medicare for All.
Google’s plan to acquire Fitbit draws scrutiny of regulators
Antitrust officials across the globe are scrutinizing Google’s planned acquisition of Fitibit, Inc., with Bloomberg reporting that regulators in the US, Europe and Australia are concerned about the trove of consumer data the company is stockpiling, and the implications for consumer privacy. Google announced last November that it would acquire the fitness tracking company for $2.1B, which would put Google in direct competition with Apple, which controls over half of the smartphone market. Concerns center around the potential for Google to use Fitbit data for other business applications even though consumers have only consented to providing their data to Fitbit, as well as the possibility that Google will loosen Fitbit’s strong privacy protections over time in order to access more data—something that the company has done in previous acquisitions. According to antitrust experts, the deal could be a landmark test case of how regulators view Google’s use of acquired data to fortify their dominance in other market segments. Google has continued to move into the information layer of healthcare, striking partnerships with health system giants, including a relationship with Mayo Clinic to create artificial intelligence tools. Federal regulators are already investigating data privacy concerns in its work with Ascension Health. Google’s move into “healthcare-adjacent” businesses like Fitbit will augment their ability to establish a more complete health profile of individual patients beyond the clinical medical record. We are long overdue for a public discussion of how the technology and healthcare sectors intersect, how health information is used, and what patients are comfortable sharing with whom and for what purposes.