FiercePharmaPolitics—Trump plans $200 cash cards for seniors, but the source of funding is unclear

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The White House plans to send out $200 cash cards to seniors ahead of the Nov. 3 election. (Getty Images/alexialex)

Welcome to the FiercePharma political roundup, where each Monday we’ll highlight developments in Washington, D.C., and elsewhere that could affect drug pricing and how drugmakers operate. 

After drug pricing talks between the White House and the pharmaceutical industry reportedly fell apart over a demand for “Trump Cards,” the administration is moving forward with a new plan.

Officials said last week that the administration will soon send out cash cards to seniors to help Medicare patients with drug copays. 

The administration plans to distribute $200 cards to about 33 million seniors using money from a Medicare trust fund, the Wall Street Journal reported. It’s an unprecedented, $6.6 billion move right before the election and won’t address the long-term need for reform, critics said. 

Money from Medicare’s trust funds almost always pays directly for health care for seniors and people who are disabled, WSJ reports. But the administration appears to be using a waiver program to that allows the government to try new initiatives. 

Typically, the government must prove new initiatives won’t increase spending under such waivers, which are usually small-scale trials. Officials didn’t explain exactly how the plan would be funded on a Friday call, WSJ reports. 

RELATED: White House, pharma pricing talks fell apart over demand for 'Trump Cards': NYT 

In response, critics questioned the administration's motive and legality of the program. 

“If the president had kept his commitment to lower prescription drug prices, he wouldn’t need to promise some Medicare beneficiaries a dubious discount card days before an election,” Patients For Affordable Drugs founder David Mitchell said in a statement. Further, "it’s not at all clear if this is legal or how the president will pay for his scheme,” Mitchell said. 

“Americans need systemic, enduring reforms to our rigged drug pricing system, not election year gimmicks,” he added. 

In a statement, Sen. Ron Wyden called the cards a “taxpayer-funded bribe.” 

“Trump is resorting to gimmicky coupons that hide the fact that he has totally failed to lower drug prices and that Big Pharma is thriving under his watch,” Wyden said. 

RELATED: Trump unveils favored-nation drug pricing executive order, and pharma hits back 

The plan comes after talks between the White House and the pharmaceutical industry reportedly fell apart over a demand for cash cards. The sides had been negotiating a potential $150 billion deal to help lower Medicare patients' out-of-pocket costs, but the industry balked when White House chief of staff Mark Meadows demanded cash cards for seniors, according to the New York Times. Some people within the industry had begun calling them “Trump Cards," the report said.

PhRMA's board concluded that the cards would be inappropriate so close to the November 3 election. A spokeswoman for the drug industry's trade group told the NYT the organization “could not agree to the administration’s plan to issue one-time savings cards right before a presidential election.”