Price's Ouster Leaves Void in White House's Health-Care Struggle

(Bloomberg) -- Tom Price's resignation as secretary of the U.S. Department of Health and Human Services has cost President Donald Trump his first Cabinet member, left a hole in health policy leadership amid the ongoing fight over Obamacare and has the White House reassessing its travel policies.

Price, who quit late Friday after seven months on the job, was grounded by Politico's reports that he took more than two dozen private flights at taxpayer expense as well as trips to Europe, Africa and Asia on military aircraft, at a total cost of more than $1 million.

Already bruised by the loss of several top staff, Trump hasn't said yet who will take over one of the U.S.'s largest government agencies. One thing is certain: the job description will include pushing harder to help the GOP in its so-far fruitless efforts to repeal Obamacare.

The disruption from Price's departure could have an effect on how the administration moves forward on Obamacare, including a proposal Trump has promised to allow people to shop across state lines for health insurance and whether the individual mandate for everyone to have health coverage under the law is enforced, said Kim Monk, an analyst with Capital Alpha Partners in Washington. It could also affect emergency responses to hurricanes and other health-related disasters, Monk said.

“Price's ouster is certainly disruptive to an agency that has a broad agenda and a big ‘to do' list,” Monk wrote in a note.

Distraction Issue

Price's exit also could distract from other administration priorities like tax reform. It's likely to raise more questions about other agency heads who have taken taxpayer-funded trips on private aircraft, including Treasury Secretary Steven Mnuchin; Environmental Protection Agency Administrator Scott Pruitt, as reported by CBS; and Interior Secretary Ryan Zinke, according to the Washington Post.

During the administration's monthslong attempt to get Congress to repeal the Affordable Care Act, Price wasn't an obvious force in the Senate, where the effort is indefinitely stalled. He did, however, let the law wither under his administrative tenure. His agency slashed advertising funding meant to get people to sign up for insurance plans sold under the law and cut budgets for local groups of “navigators” who helped people find the right plan. HHS also shortened the time when people could sign up for coverage and took other steps that critics decried as “sabotage.”

“The mission of the Health and Human Services secretary should be to support Americans' health care, not take it away,” Senate Minority Leader Chuck Schumer said in a statement. “The next HHS secretary must follow the law when it comes to the Affordable Care Act instead of trying to sabotage it.”

Successor List

Obvious candidates to succeed Price, 62, are those who have already made it through the vetting process and Senate confirmation. One is Seema Verma, who leads the Centers for Medicare and Medicaid Services and who is directly responsible for running much of the Affordable Care Act. Another is Scott Gottlieb, the Food and Drug Administration commissioner, who has implemented several programs on drug prices and on modernizing the agency.

Verma is seen as close to the White House. She worked with Vice President Mike Pence to implement the then-governor's Healthy Indiana Plan, and has regularly visited Capitol Hill to help push Obamacare-repeal efforts. Gottlieb wrote opinion pieces prior to becoming FDA commissioner on how the Affordable Care Act reduces competition among insurers and how its payment reforms were forcing doctors to sell out to hospitals.

After Price's resignation on Friday, the White House moved to contain a metastasizing scandal over the travel of senior officials, clamping down on private-jet use.

Budget Director Mick Mulvaney issued a memo ordering government agencies to seek approval from Chief of Staff John Kelly before most travel on government-owned or chartered planes.

Flying Commercial

“Just because something is legal doesn't make it right,” Mulvaney said. “Accordingly, with few exceptions, the commercial air system used by millions of Americans every day is appropriate, even for very senior officials.”

Don J. Wright, of Virginia, will serve as acting secretary. Wright was acting assistant secretary for health, overseeing the department's health policy recommendations, a position he has held since February. He has a medical degree from the University of Texas and a master's degree in public health from the Medical College of Wisconsin.

Price's seven-month round trip in and out of the health agency was bracketed by questions about his conduct, starting with trading of stock in health-care companies and ending with the jet trips. Price said he would pay $51,887.31 to reimburse the government for his chartered-jet trips. 

Price, an orthopedic surgeon, joined Congress in 2005 as a representative from Georgia and was one of the original members of the Tea Party, which promotes small government. In the House, he introduced several bills to replace Obamacare. While his nomination to head HHS was backed by the American Medical Association, the largest U.S. doctors lobby, that group and almost every other health-care trade organization issued strong statements opposing the administration's Obamacare-repeal attempts.

Stock Trading

During his swearing-in, Price was asked about whether, as a congressman, he improperly traded shares in medical companies while at the same time dealing with health-care legislation that could have affected them.

In one instance, he received a discount on shares of Innate Immunotherapeutics Ltd., an Australian biotechhnology company. He also invested in a medical-supply distributor before introducing legislation that could have benefited the company.

Price defended the trades at the time, saying a broker directed the trades independently, except for his purchase of Innate shares. He said he learned of Innate and the special stock offering through Innate board member and fellow Representative Chris Collins of New York.

Then, this month, Politico reported that he had taken more than two dozen private flights at a cost to taxpayers of hundreds of thousands of dollars, including trips to Nashville, Tennessee, where his son lives and where he owns a condominium. 

Price's office defended the travel decisions, calling the trips more convenient than cheaper, commercial travel. Cabinet members typically fly on commercial airlines unless there's a specific reason to take a private plane.

To contact the reporter on this story: Anna Edney in Washington at aedney@bloomberg.net.

To contact the editors responsible for this story: Drew Armstrong at darmstrong17@bloomberg.net, Cecile Daurat, C. Thompson