Capitol Correspondence - 06.24.19

Tensions with White House Contributing to Turbulent Times at HHS

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ANCOR is sharing this article by Politico Pro because it is important for our members to understand the political environment within which key health and disability policy-makers operate, particularly as the Department of Health and Human Services (HHS) reorganizes its staff. Note that towards the middle of the article, flexibility for states administering Medicaid is mentioned, a potential reference to upcoming Medicaid block grant guidance. The majority of disability supports such as those offered by our members are funded by Medicaid. Additionally, the article briefly touches on drug rebates, another Medicaid issue relevant to the disability community. Note that an update on this article came out in Politico Pulse on June 24 – that segment is copied at the end of the article for your convenience.

As shared by Politico Pro:

“White House officials have soured on HHS Secretary Alex Azar, a deepening quarrel that threatens to derail President Donald Trump’s health care agenda as he gears up for his 2020 reelection campaign.

The divide has led to stalled projects, disputes over Medicaid and fetal tissue research, duplicated work on Trump’s drug pricing priorities — and bitter personal attacks, say a dozen current and former White House and HHS officials as well as multiple other people familiar with the conversations.

The stakes are further heightened because health care is expected to play a crucial role in the 2020 election, and Trump has repeatedly pledged to soon unveil a plan that is higher quality and less expensive than Obamacare — an ambitious promise that his team of rivals is not ready to deliver on.

‘You have two teams with two visions,’ said an individual who’s been in heated meetings with HHS and the White House. ‘Alex is outnumbered and keeps losing.’


Despite the recent tensions, Azar is not perceived to be at risk of losing his job — although the president is famously fickle and, by some accounts, Trump’s trust in his health secretary has eroded. A former Jeb Bush fundraiser, Azar entered the Trump administration without ties to the president but he did have ties to Mike Pence from his time as a top executive at Eli Lilly in Indiana.


Azar has spent months battling White House domestic policy chief Joe Grogan, acting chief of staff Mick Mulvaney and other officials over proposals targeting high drug prices, Medicaid and Obamacare, individuals inside and outside the administration said. But Azar has been repeatedly overruled, including on Trump’s decision to reverse a Justice Department stance in a high-profile Texas lawsuit and urge courts to strike down the entire Affordable Care Act.


Meanwhile, White House officials have used their access to bypass Azar and directly lobby Trump — and have won nearly all of this year’s high-profile health policy battles, according to five current and former administration officials. More fights still loom on granting states additional Medicaid flexibility, boosting transparency of health care prices and other drug pricing issues. [Emphasis added by ANCOR.]

‘It’s Joe, Russ [Vought, acting OMB director], Mick, the whole cabal … they’re all fighting him,’ said one former official who’s been in tense meetings with Azar and his White House counterparts. ‘They’ve slowed his rules and made everything difficult.’

Azar retains support from Trump and his allies remain confident he can weather this current wave of attacks. The HHS secretary has cultivated a close relationship with Trump, who has hailed him repeatedly for his bid to slash drug prices.

Azar also has strong relationships in several other corners of the White House, three individuals say, including Jared Kushner — the president’s son-in-law and close adviser — and First Lady Melania Trump, who has traveled with Azar to the border and to tout the administration’s opioid response. […]

But the deep divide between Trump’s top health policy officials is causing staff confusion and repeated delays […]

Most of the tension, however, has been between HHS and the White House’s policymaking apparatus. While Azar bristled over Grogan’s leadership of the health division inside the Office of Management and Budget — an internal clearinghouse that frequently slow-walks Cabinet members’ initiatives due to budgetary concerns — their battles have intensified since Grogan was elevated to run the White House Domestic Policy Council, which has more authority to shape Trump’s agenda.

A recent flashpoint: HHS’ effort to lower drug prices through a controversial rule that would effectively eliminate rebates given to drug makers. Grogan had fought the so-called rebate rule over its approximately $177 billion cost to the government over a decade — even as Trump and Azar have touted it as a strategic piece of the president’s longstanding vow to lower drug prices. The rule is now on track to be finalized, sources on and off Capitol Hill said, though it’s yet to clear budget officials’ review. [Emphasis added by ANCOR.]


Azar is not expected to leave HHS before the 2020 election, according to four individuals. He announced an agency-wide leadership reorganization on Monday that strengthened his lieutenants. Trump’s second HHS secretary who received Senate confirmation in January 2018, Azar has prioritized good governance of the agency and is conscious of not appearing to bow to a particular side for political expediency.”


June 24 Update:

AZAR, WHITE HOUSE PUBLICLY MEND FENCES — HHS Secretary Alex Azar and senior administration officials have spent several days working to tamp down a POLITICO report on growing internal tensions. One visible example: Azar’s public lunch Friday at the White House with Domestic Policy Council chief Joe Grogan, POLITICO’s Adam Cancryn reports.

Azar made multiple stops on Fox News late last week, including an appearance Thursday night where he derided POLITICO’s report as “absolute nonsense.”

“The president is a great leader. He’s a great leader, and what do great leaders do? They get a team together to bring together different viewpoints and argue things out,” Azar said. “We’re here to serve him and implement his agenda.”

— President Donald Trump also name-checked Azar in Sunday’s “Meet the Press” interview. “We have a man named Azar, our secretary, he’s [a] fantastic man, Alex,” Trump told host Chuck Todd when discussing health care. “A total pro.”

How we got here: POLITICO last week reported on conflicts between Azar and the White House policy apparatus, led by Grogan and acting chief of staff Mick Mulvaney. A dozen current and former administration officials detailed heated policy battles, including when Azar was overruled by Trump on decisions involving Obamacare and fetal tissue.

Rep. Matt Gaetz (R-Fla.) also described a meeting last month when Azar appeared to frustrate Trump with his resistance to importing drugs from Canada.