Why the Covid-19 Emergency Won’t Expire, Again

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Speaker 1: From the opinion pages of The Wall Street Journal, this is Potomac Watch.

Kyle Peterson: The Biden administration plans to extend the coronavirus public health emergency, as rumors circulate that President Trump might make an early announcement of a 2024 campaign. Welcome, I’m Kyle Peterson with The Wall Street Journal. We’re joined today by my colleagues, columnist Kim Strassel, and editorial board member Allysia Finley. Welcome to you both.
The federal government’s COVID emergency was originally declared in January of 2020, and it has been repeatedly extended ever since. The latest expiration date was supposed to be on July 15th, which is this Friday, but news outlets are now reporting that the Biden administration intends to renew it again, at least probably for another 60 days, maybe 90, maybe more. And Allysia, this sounds like a dry mechanical piece of government bureaucracy, but can you give us a sense of what the importance of this is and why people should be paying attention to it?

Allysia Finley: Okay, so there’s several different public health emergency laws. This one actually is somewhat narrow and doesn’t provide all that much discretion to President Biden or HHS. What Congress did in March 2020 though, is it allowed or actually required the suspension of food stamp work requirements and training requirements so long as this public health emergency declaration was in effect. It also mandated or barred states from removing from their Medicaid rolls anyone who is deemed ineligible if they want to receive an extra 6.2 percentage point bump in their Medicaid funding. So the result of this has been just a huge increase in the welfare rolls, both for food stamps and Medicaid. And you’ve seen almost a 24 million increase in people on Medicaid. Most of these are young, able-bodied people. And for the food stamp you’ve seen about a 4.4 million increase. Even as the economy has improved, it’s still there are about 4.4 more million people on food stamps than before the pandemic.
So this also raises concerns about, well, are these providing disincentives for people to return to work? I’m not so sure that’s the case in the Medicaid, but I do think that could be the case in the food stamps. But it also raises questions about executive discretion. This public health emergency was only actually intended, Congress never thought it would go past maybe December, 2020. This was intended to be very a discrete authority. And now the Biden administration keeps on extending it. And I think it may be to some extent, it provides a lesson to Congress that you don’t give the executive emergency authorities because they get abused and then they get extended.

Kyle Peterson: But to underline the point on Medicaid. So just to repeat kind of what Allysia said, that Congress passed a bill, one of these COVID aid bills in 2020, gave states a bump in Medicaid funding if they agreed to not dis-enroll people who become ineligible for the duration of the emergency. And the thought process was we’re in a public health coronavirus pandemic and we want people to continue to have access to the tests, the treatments, whatever they need so we’ll increase the federal funding. And as a condition on that, we’ll keep everybody enrolled through the end of the pandemic. And it is interesting now, Kim, that we’re two years away and I’m wondering whether there are any governors that are going to think twice about taking that deal now or decide to turn the deal down. Because as the fixed amount, the fixed percentage, that they got in the bump in the Medicaid funding is the same and yet the longer that this emergency, this public health emergency goes on, the more and more people that get built up on the Medicaid rolls who are actually no longer eligible to be receiving the program. And at some point, those costs and increased flow of federal funds get out of balance and it might be costing the states more than they think in their budgets.

Kimberley Strassel: Especially when you look at the numbers. Because, let’s be clear, this emergency is essentially being used to dramatically expand the welfare state. And you guys have just explained how the process whole works and how this emergency authorization and this legislation passed by Congress has tied the hands of states. But you’ve seen in the end enrollment, for instance, in Medicaid has ballooned to 95 million people. That’s up from 71 million people in December of 2019. 30% of America is now on Medicaid and most of these states can’t do anything about it because the only way to now take someone off the Medicaid rolls is if they die or they leave the state or they purposely opt out, which doesn’t happen very much. Similarly food stamps. Right now, we have 41 million people getting food stamps. That’s 4.4 million more than before the pandemic. And you look down at these states, some of them they’ve got these really hot economies. They are working at record unemployment levels, low unemployment levels. They’re adding new jobs. We’ve got a worker shortage out there of 11 million job openings, but only half as many people available to work. Part of the reason for that is because of all of this expanded welfare and entitlement giving.
And so, yeah, I think you are right, Kyle. There would be a growing incentive for some of these states to begin refusing to take that federal money simply so that they can get some ineligible people off of their rolls. By some estimates, there was a foundation for government accountability survey, assume that there are something like 23 million ineligible people on Medicaid at the moment. That’s a lot of bottom line costs for the states, even if they are getting that little bump.

Kyle Peterson: And I will underline that with some of the unemployment numbers. So in May, the national unemployment rate is 3.6% in the United States. But some states with remarkably low numbers, Nebraska, 1.9% unemployment rate, Indiana 2.2, Idaho 2.5, Virginia 3.0, I mean, these are historically low unemployment rates, Allysia. And I understand that whenever you end a sort of a program like this, it’s the same thing with the eviction moratorium that we discussed at the time. There’s going to be some hardship cases that come out, but you also can’t run a country with emergency policies forever. And it seems like if you are going to end a policy like this, you would want to do it at a time where there is 3.6% national unemployment rate and employers that are really hurting and looking for workers to come help them. And so the other thing I would point out, Allysia, is it seems like the Biden administration is picking and choosing where it wants to say that there continues to be a COVID emergency, because if I recall, they wanted to end the COVID emergency at the border and now they’re trying to keep the public health emergency here for the purposes of Medicaid.

Allysia Finley: Yeah. Good points on both. And on the first point, I would just add that most people become or have become ineligible, those 23 million that Kim has pointed out, because they’ve actually are earning income. Before, during the pandemic, they likely lost jobs, which would’ve put them underneath 100% or 133% of the poverty line in those expansion of Obamacare expansion states. But many of them now actually have returned to work. And that’s why they are now ineligible is because under their incomes, they are no longer eligible. So they could actually potentially get employer insurance and actually pay for it themselves. But why, when you can get it free from Medicaid? Or many of them would also be eligible for the ACA, the Obamacare subsidies on the exchanges. And this is what I suspect is really going to be the issue and why the administration keeps on extending them is, because these ACA subsidies are likely to end at the end of the year. And what happens then? Well, many of them, something people might otherwise be able to qualify for Medicaid. So I think indirectly that this public health emergency could become a public option.
To your second point, that they want to treat this as an emergency in some context, but not others. Obviously they ended the Title 42, which was also promulgated under emergency authority. The Title 42 was the authority that the CDC claimed to expel people across the border without providing some due process. They obviously ended that. A federal court has reinstated that, but they continue to argue that there is no public health emergency to justify that. The other place where you really haven’t seen a lot of urgency is this Novavax vaccine that was actually funded by the Operation Warp Speed. And there were some hiccups in their trial, but it’s actually been shown to be just nearly as effective as the Moderna and Pfizer vaccines, at least initially.
The World Health Organization authorized it in December and then the FDA kind of has dragged its heels. In June the FDA held an advisory committee meeting to actually consider granting approval or granting emergency use authorization to this Novavax vaccine. And they nearly unanimously endorsed it because they actually felt that, well, maybe people who were hesitant get a mRNA shot because the technology is kind of novel, maybe they’d be more inclined to get this Novavax shot, which relies on more traditional technology, more like traditional vaccine, like flu shot. But the FDA still hasn’t, a month later, it still hasn’t authorized it. There may be some hangups in ensuring the manufacturing process, all of that, is up to snuff, but there clearly isn’t the same kind of urgency that you would consider if the Biden administration thought that this was an emergency situation.

Kyle Peterson: Hang tight. We’ll be right back. You’re listening to Potomac Watch from The Wall Street Journal.

Speaker 1: From the opinion pages of The Wall Street Journal, this is Potomac Watch.

Kyle Peterson: Welcome back. A couple of final questions on this public health emergency issue. One is I think there might be a broader lesson here about how the federal government runs its business. And, Kim, I would point to another editorial we had from January looking at the improper payment rates in the Medicaid program. And nationally it is about a fifth of all payments. And there’s a study looking at some specific states. Ohio, bad payment rate is 44%, in Illinois 37%. And to be clear, again, most of this is around eligibility of people who are on the program. And so some of that might be people who are actually eligible for the program, but the records are missing, or there’s no evidence in the files that the person’s income was verified, or the files were not maintained.
And so, Kim, I mean, we’re talking about like billions and billions and billions of dollars, and we can’t keep track of the records to make sure that a lot of that is clear, that it’s supposed to be spent, and the money’s supposed to be going where it’s going. And it’s hard for me when you have numbers like that, improper payment rate of 22% nationally, it’s hard for me to get on board with the argument that President Biden is making that we need to build back better and we need to expand the federal government’s role in all sorts of places where it is not already playing a role, including childcare subsidies and homeowner subsidies and so forth.

Kimberley Strassel: These are just simply shocking numbers. But I think for many Americans, maybe not shocking because it is unfortunately how we have come to believe that the federal government works, sometimes state governments as well too. And they’re all the more believable because when you look around and see Inspector General reports for other programs like this, for instance, what happened with all that enhanced unemployment money that went out the door during the pandemic, the number of ineligible people who are estimated to be receiving food stamps, the list goes on and on. You also get these huge numbers of errors. The number of people who are incorrectly getting certain tax credits, it’s just stunning. And the argument from the federal government and the big government types is, “Well, you need to let us hire more people.” Well, the government has expanded dramatically in recent years, and that has not necessarily helped in any way to get on top of the waste and the fraud and the abuse. And I think the thing that’s even more shocking about these numbers that you are quoting, those ones from the individual states about improper payments rates, those are for 2019. That is pre-pandemic. And there are some estimates that those numbers are much higher. And there’s some evidence that a lot of these improper payment rates have gone up as programs have expanded, so since the expansion of Medicaid that came through Obamacare. Some estimates are bad payments have quadrupled. So bigger government just means more waste, fraud, and abuse. And it would seem that if government and Biden and Democrats want to make the argument that they should be allowed to continue to expand these, by the way, without Congressional approval, which is another problem that they should have to show a lot more diligence in figuring out who was supposed to be getting the money here, especially because when we don’t do that, bear in mind, there’s always a cost to this. And the argument from them is always just give more to more people, but there are not infinite resources and it means we’re not actually giving resources we could be giving to those who are most needy.

Kyle Peterson: Last thought on this, Allysia. Are there other policy issues that are playing into this public health emergency decision? So if I recall right, under the old rules, Medicare had very strict rules on telehealth. And so to get telehealth services as a Medicare patient, you had to live in a rural area. You had to be dialing from a healthcare provider to another healthcare provider. And so if I recall right, one of the flexibilities of this public health emergency allowed Medicare to let seniors essentially call their doctors on FaceTime. And I get why during the middle of a coronavirus pandemic that would be an incredibly useful thing to do. And so are there other policy issues like this that are playing into the Biden administration’s thinking, do you believe, as they’re extending this emergency?

Allysia Finley: I actually don’t think so. In terms of this telehealth coverage, I think that’s a little bit of a smoke screen. In November CMS put out a rule that actually expanded Medicare coverage for telehealth for mental health issues and behavioral health issues. So it clearly believes that and does have the authority to do so to actually write a regulation and rule to do so, but it actually hasn’t initiated it for more broadly than mental health. One question, I guess, you could be a cynic in saying, “Well, maybe it doesn’t want to do that or doesn’t want to ask Congress for explicit authorization to do that because it wants to maintain this pretext that we need this public health emergency declaration to provide telehealth coverage for seniors.” Again, that’s being a cynic, but you can never lose money like a cynic with this administration.

Kyle Peterson: Finally, rumors are continuing to swirl that President Trump intends shortly to announce potentially a 2024 Presidential campaign, which would be a very early announcement, historically early. I don’t know another Presidential candidate who has announced he’s running before the midterms. Perhaps that has something to do with the investigations into him as we’ve discussed. if he’s worried that there may be a criminal case that is brought against him, he would probably rather face that as a running Presidential candidate, but here’s a clip we’ll start with. Kellyanne Conway, former Trump advisor, talking to our colleague Gerry Baker on his Free Expression podcast about what a Trump 2024 run should look like.

Kellyanne Conway: ASCO’s Trump 2024. I have had those direct conversations with President Trump and my advice to him privately and publicly is the same. If he wishes to be President in the United States again, he should have a cage match rematch against Joe Biden and offer a binary policy and accomplishments contrast from the Trump White House to the Biden White house. No more of this talking about the past, look toward the future, develop a vision. But, look, that has to be weighed against any number of countervailing factors. The biggest one in my view is whether the people who want to constantly investigate him and his family and the people around him are ever going to let up on the gas. It looks like they won’t.

Kyle Peterson: Kim, what do you make of this? And particularly the whether a Trump announcement for 2024 here in the months leading up to the November midterms might scramble some of those races. I mean, it does seem to me that if you’re Mehmet Oz, if you’re Dr. Oz running in that Senate race in Pennsylvania, you would rather run as a contrast to Joe Biden and not have to face questions about a referendum on President Trump.

Kimberley Strassel: This is a terrible idea. And as you note, it’s unheard of. I’ve certainly never come across a candidate getting in prior to the midterms, at least not one of any consequence. And it’s a terrible idea, I say that, completely unrelated to the question of a Donald Trump run in the future. Just the timing is terrible because right now this should be a historic election for the GOP. Everything is working in their favor. The administration is under fire for inflation, for gas prices, for a baby formula crisis, for people’s sinking 401ks. 75% of the public says we’re going in the wrong direction. Biden’s at 38% approval rating in the RealClearPolitics average. A recent Siena/New York Times poll had him at only 33%. This is a referendum on the administration. And as such, it should be very good for conservatives and win them both the House and the Senate. If Donald Trump gets in here, it’s going to instead be all about him. The only group that would love that absolutely would be the Democrats because they want to focus on Donald Trump. They could put the attention on him rather than all of their economic and foreign policy travails. It could be much harder for certain swing district Republicans to win House races, given suburban voters and the way that they left Donald Trump in the last election. You could end up with basically a repeat of Georgia and those Senate races where because the president continued to talk about the election of the past rather than going future, it turned off the voting public. So let’s have a debate after the midterms about where the Republican Party field stands, but doing this, he’s clearly hoping to clear the decks and freeze donors and preempt the field. I can see that, but Donald Trump might think that’s good for him, but it’s not good for the party he claims to lead.

Kyle Peterson: But notable also that Siena/New York Times survey that gives President Biden a 33% approval rating, also has him beating President Trump in a head-to-head theoretical matchup, 44% for Joe Biden and 41% for President Trump. The other poll I would point to, Allysia, is a new Political Morning Consult one, and 61% of Americans say they don’t think it’s a good idea for President Trump to run in 2024, and 64% say they don’t want President Biden to run in 2024. And I don’t know that I’ve ever seen a result like that where you have a really strong majority of the public looking at both of the top contenders for the Democrats and the Republicans and saying, “Why don’t we turn the page?” And so, I don’t know, we’ll give you the last word, Allysia, if you want to comment on that.

Allysia Finley: Yeah, I think what was also kind of interesting or bizarre about that poll was it actually also showed that Trump was leading the GOP field with nearly 50%. So if nearly two-thirds of Republican voters don’t want him to run again, yet half of them list him as their preferred candidate or favorite candidate right now, what does that say about the field? I’d argue that Republican voters don’t know enough about some other potential rival candidates, including Ron DeSantis in Florida. He comes in second around 20, 21% to Trump, but we talk about him a lot and a lot of political pundits do, but maybe he just hasn’t gotten his name out there.
And similarly on the Democratic side, I think a lot of Democrats don’t want Joe Biden to run again, but they don’t know who the alternative is right now. There isn’t really a strong candidate who could take his place in beat Trump or a Republican like Ron DeSantis. Kamala Harris, Gavin Newsom’s appearing to be trying to make a bid. There doesn’t seem to be any real contender on the Democratic side who could actually make a credible run in 2024, whether it be against Trump or whether it be against another Republican candidate. And so I think both parties are just really frustrated right now with their options or apparent options.

Kyle Peterson: Thank you, Allysia and Kim. Thank you all for listening. You can email us at pwpodcast@wsj.com. If you like the show, please hit that subscribe button on your favorite podcast app. And we’ll be back tomorrow for another edition of Potomac Watch.