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Takeaway: A decisive turning point in the Trump campaign; health care jobs remain weak and the tragic end to public health

Editor's Note: This is a complimentary research note published by Healthcare Policy analyst Emily Evans. CLICK HERE to get daily COVID-19 analysis and alerts from our research team and access our related webcasts.

WHAT A LONG YEAR, LAST WEEK WAS.

A Very Bad Week in America | Politics, Policy & Power - 6 7 2020 10 04 31 PM

Politics 

Donald Trump, with his love of chaos, has single handedly turned days into weeks and weeks into months.

His way of making American politics move at a speed that leaves little time for lunch at Cafe Milano has left official Washington, its press and this former resident with a bad case of vertigo.

Until last week, President's Trump style was appealing to voters in that it allowed him to accomplish many things he set out to do; disrupt trade relationships, challenge the pet projects of globalists like WHO, restore some confidence in the remaining shreds of middle America; and enforce border control.

Over the last few years - a decade maybe - competence in government has been an underappreciated skill. Is that because poor decisions have been papered over with leverage?

Or that government actions and initiatives have become less and less consequential for most Americans?

Or maybe being socially acceptable became more important to the local and national press than a rational understanding of current events, ceding knowledge leadership to the ridiculously named, Facebook?

America's decision to elect a reality television star who presided over bankruptcy of his hotel and casino businesses six times can only be interpreted as a "yes" to all those questions. 

In times of chaos, a chaotic management style is wanting. Protests around the White House and across the street at Lafayette Square reached such an emotional pitch last week that the president was ushered to the bunker in the basement. That move was followed by a disastrous photo-op across the street at St. John's meant, we assume, to change the subject. The sequence of events left anyone watching to wonder if the president actually had a plan to quell violence in the Capitol, preferably using peaceful methods.

The problem of competence in American politics is not confined to 1600 Pennsylvania Avenue, nor is it a partisan problem. The New York City area death toll from COVID-19 and subsequent destruction of property and lives by looters and rioters can be laid at the feet of Mayor DeBlasio's administrative skills and his blind devotion to political talking points.

The untethering of the Minneapolis police force from the executive branch can only mean the Mayor so poorly managed his city that officers assigned to serve and protect were murdering the citizenry.

Here in Nashville, the police arrived at protests unprepared and stood by while the courthouse was burned, and the Lower Broad entertainment district was looted and vandalized; all because leadership thought the city would be immune from violence spreading across the nation.

If the public wants nothing else from its elected leaders it is the ability to protect life and property, preferably peacefully and compassionately.

The failure to do so around the White House and in many American cities brings competence and managerial skill racing back to the fore, just in time for election day. 

Former Vice President Biden's long tenure in government now becomes an asset in attracting moderate voters which in turn makes resisting the demands of the far left for Medicare for All and other superficially appealing policy efforts easier.

Five months until election day and a lot can change but last week was no doubt a turning point for the outcome.

Policy

Despite the desperately cheerful press conference held at the White House on Friday to laud an employment number that was better than expected, the news for health care was mixed.

Dentists' offices which had seen employment reduced by half from February to April, recovered 300k of the 542k lost, leaving about a third of dentists' office employees still without jobs. Physicians' offices regained 51k of the 290k jobs lost between February and April. For hospitals and nursing homes/residential care facilities the recovery is not evident.

They continued to lose jobs, 26k and 36k, respectively, in May.

A Very Bad Week in America | Politics, Policy & Power - 20200607P3

The stunning job losses sustained by dental and physicians’ offices suggests they opted to lay off employees, who were then eligible for unemployment insurance, rather than enroll in PPP. The return of these employees to work probably represents bona fide demand from patients, which is mildly encouraging. Hospitals, and to a much lesser extent, nursing homes received their aid in the form of an advance on Medicare payments, enhanced reimbursement for COVID-19 patients and in the form of grant money from the CARES Act. 

None of these programs have a requirement to maintain payrolls. The further declines in employment in these two subsectors reflects diminished demand for services.

The increase in employment by physicians, however, suggests the referral pathway of physician-to-hospital has reopened and activity at hospitals should pick-up. Anecdotally, we are hearing that revenue recovery at hospitals is happening more quickly than administrators thought, although most admit that isn't saying too much. 

Dental offices are more concerning. Dental services are relatively discretionary and less tied to insurance-sponsored reimbursement. Dental services are not a Medicare benefit. When they are a Medicaid benefit it is usually limited to pediatric care.

The fact that a third of pre-COVID employees have not returned to work reflects deferred care in the face of economic realities.

The tricky policy problem is health care has been a big driver of employment over the last decade. Twelve percent of jobs added since 2010 were in the health care sector and that data does not include employment in ancillary activities like IT, consulting, architecture, device and supply manufacturing and distribution, etc.

Counter to the macro narrative that most of the job losses during COVID-19 were in low wage, low skill jobs (read: not major drivers of demand), health care provides solid middle class jobs and a slow recovery in the sector spells trouble for the economy as a whole.

Worse for the macro tourist, how would the White House ever support more stimulus while driving home a narrative that recovery is robust and well underway?

Power

Hypocrisy and power are old friends and last week they got the band back together.

On the one hand, political and public health officials had been demanding an unprecedented suspension of civil rights be extended almost indefinitely.

In most cases, social distancing restrictions limited large gatherings and, without much scientific basis, frequently visits to parks and beaches. On the other hand, public horror at the alleged murder of a black Minneapolis resident by a white police officer, drove people out into the streets in protest.

Lost in the outrage was six feet of distance and face masks.

Public health relies almost completely on trust to be effective. Public health officials need to provide the proper balance between alarm and confidence. For their part, the public must be willing to accept certain restrictions on their behavior. They do so because they believe and trust the public health leaders have their best interests in mind.

There is no way to compel compliance on a scale a country as big as the US would demand. If public health requirements are too alarmist - and thus overly restrictive - the public will balk. 

And they have.

We were surprised that most Americans went along for so long. We had put mid-April as the date we would start to feel comfortable about containment of the disease (highest daily cases occurred on April 8).

Adding a couple weeks, We expected by April 30, most activity would start to return to normal, and it did in many places like Colorado and Florida. I never anticipated that a number of mayors and governors would feel no urgency to restore economic, academic and social activity; that the damage being done, especially to the young, would not outweigh any concerns about a disease, which continue to diminish in a country that performs almost half a million tests a day.

Here we are, over a month later, many leaders still feeling no alarm over the prospect that businesses and people are and will continue to be harmed by onerous policies applied differently across the community.

The public rightful smells a rat. Most people want peaceful protests to occur.

Even if they didn’t, they don't have much cause. Freedom of assembly is constitutionally guaranteed.

But so too is visiting a lawful business or listening to musicians perform in concert. It has not helped the image of the public health that the Governor of North Carolina suggested social distancing requirements were too important to allow accommodation of the Republican National Convention in August. The Mayor of Nashville, worried his empty Music City Center would provide a nice alternative, delayed moving to the next reopening phase, despite improving data; thus, providing his own justification for giving the RNC the Heisman. 

The reopening plans now exist largely on paper. Businesses can violate the standards without fear of enforcement, though we expect most to be very supportive of their employees' concerns.

After last week, police have enough reputational damage to repair, arresting restaurant owners would be an absurdity not even these times could justify. Even if the police enforce, district attorneys won't prosecute.

The law requires public health be protected with the least restrictive methods possible. Any district attorney that wants prosecuting bar owners as his legacy, won't get a conviction. Judges know imposing public health restrictions for political purposes has a long history in this country and usual concludes on the side of the aggrieved.

The fallout from this bit of anarchy has significant consequences. Public health officials like former CDC director Tom Frieden have rightly pointed out that protesting outside poses little risk to public health, while others like Anthony Fauci express concern about a spike in cases caused by contact during protests.

You can forgive the public for being skeptical of all of it. The trust so vital to a public health response now and in the future is probably damaged beyond repair.

I had hoped COVID-19 would mark a return of the trust we must have in experts. It will not be so.