Tag Archives: CARES Act

Reformed Covid Reporting Might Quell the Omicron Panic

31 Friday Dec 2021

Posted by in Coronavirus, Data Integrity

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That’s our Commander and Chief this week, posing in a mask on the beach in what is a phenomenal display of stupidity. More importantly, that kind of messaging contributes to the wholly unwarranted panic surrounding the Omicron variant of Covid-19. Panic, you say? Take a look at this admission from a New York health official. She says a recent alert on pediatric hospitalizations was driven by a desire to “motivate” parents to vaccinate their children. Yet Covid has never posed a significant risk to children. And take a look at what this insane physician posted. It’s fair to say he’s “catastrophizing”, an all too common psychological coping mechanism for alarmists.

The Omicrommon Cold

Given Omicron’s low apparent severity, it might be the variant that allows a return to normalcy. It’s perhaps the forefront of a more benign but endemic Covid, as it seems to be out-competing and displacing the far more dangerous Delta variant. In fact, Omicron infections are protective against Delta, probably for much longer than vaccines. The mild severity we’ve seen thus far is due in part to protection from vaccines and acquired immunity against breakthrough infections, but there’s more: there are plenty of non-breakthrough cases of Omicron, and most hospitalizations are among the unvaccinated. Yet we see this drastic decline in Florida’s ratio of ICU to hospital admissions (as well as a reduction in length of stay — not shown on chart). Similar patterns appear elsewhere. Omicron’s more rapid onset and course make it less likely that these patterns are caused by lags in the data.

Panic Begets Lockdowns

The frantic Omicron lunacy is driven partly by data on the number of new cases, which can be highly misleading as a guide to the real state of affairs. Testing is obviously necessary for diagnosis, but case totals as an emphasis of reporting have a way of feeding back to panic and destructive public policy: every wave brings surges in cases and the positivity rate prompting authoritarian measures with dubious benefits and significant harms (see here and here).

Flawed Case Data

In many respects, the data on Covid case totals have been flawed from the beginning, owing largely to regulators. At the outset in early 2020, there was a severe shortage in testing capacity due to the CDC’s delays in approving tests, as well as restrictions on testing by private labs. Many cases went undiagnosed, including a great many asymptomatic cases. The undercount of cases inflated the early case fatality rate (CFR). Subsequently, the FDA dithered in its reviews of low-cost, rapid, at-home tests. The latest revelation was the Administration’s decision in October to nix a large rollout of at-home tests. While the results of those tests are often unreported, they would have been helpful to individual decisions about seeking care and quarantining.

The PCR test finally distributed in March 2020 was often too sensitive, which the CDC has finally acknowledged, This is a flaw I’ve noted several times in the past. It led to false positives. Hospitals began testing all admitted patients, which was practical, and the hospitals were happy to do so given the financial rewards attendant to treating Covid patients under the CARES Act. However, it resulted in the counting of “incidental” Covid-positives: patients admitted with Covid, but not for Covid. That inflates apparent severity gleaned through measures like hospitalized cases, and it can distort counts of Covid fatalities and the CFR.

On balance, the bias caused by the test shortage at the start of the pandemic likely constrained total case counts, but the subsequent impact of testing practices is uncertain except for incidental hospitalized cases and the impact on counts of deaths.

Omicron Enlightenment

Omicron spreads rapidly, so the clamoring for tests by panicked consumers has resulted in another testing shortage, both for PCR tests and at-home tests at pharmacies. The shortage might not be relieved until the Omicron wave has crested, which could occur within a matter of a few weeks if the experience of South Africa and London are guides. In the meantime, another deleterious effect of the “case panic” is the crush of nervous individuals at emergency rooms presenting with relatively minor symptoms. Now more than ever, many of the cases identified at hospitals are incidental, particularly pediatric cases.

A thread by Monica Gandhi, and her recent article in the New York Times, makes the case that hospitalizations should be the primary focus of Covid reporting, rather than new cases. Quite apart from the inaccuracies of case counting and the mild symptoms experienced by most of those infected, Gandhi reasons that breakthrough infections so common with Omicron render case counts less relevant. That’s because high rates of vaccination (not to mention natural immunity from prior infections) reduce severity. Even Jennifer Rubin has taken this position, a complete reversal of her earlier case-count sanctimony.

Incidental Infections

Phil Kerpen’s reaction to Gandhi’s article was on point, however:

“Unless HHS Protect adds a primary [diagnosis] column, hospital census isn’t much more useful than cases.”

HHS Protect refers to the Health and Human Services public data hub. Without knowing whether Covid is the primary diagnosis at admission, we have no way of knowing whether the case is incidental. If Covid is the primary reason for admission, the infection is likely to be fairly severe. It is more useful to know both the number of patients hospitalized for Covid and tge number hospitalized for other conditions (incidentally with Covid). The distinction has been extremely important to those interpreting data from South Africa, where a high proportion of incidental admissions was a tip-off that Omicron is less severe than earlier variants.

The absence of such coding is similar to the confusion caused by the CDC’s decision early in pandemic to issue new guidance on the completion of death certificates when Covid is present or even suspected. A special exception was created at that time requiring all deaths involving primary or incidental Covid infections to be ruled as Covid deaths. This represented another terrible corruption of the data.

Summary

Earlier variants of Covid were extremely dangerous to the elderly, obese, and the immune-compromised. Yet public health authorities seemed to take every opportunity to mismanage the pandemic, including contradictory messaging and decisions that compromised the usefulness of data on the pandemic. But here we are with Omicron, which might well be the variant that spells the end of the deadly Covid waves, and the focus is still squarely on case counts, vaccine mandates, useless masking requirements, and President Brandon wearing a mask on the beach!

Case counts should certainly be available, as Gandhi goes to great lengths to emphasize. However, other metrics like hospitalizations are more reliable indicators of the current wave’s severity, especially if paired with information on primary diagnoses. Fortunately, there has been a very recent shift of interest to that kind of focus because the superior information content of reports from countries like South Africa and Denmark is too obvious. As Don Wolt marvels:

“Behold the sudden interest by the public health establishment in the “With/From” COVID distinction. While long an important & troubling issue for many who sought to understand the true impact of the virus, it was, until very recently, actively ignored by Fauci & crew.”

That change in emphasis would reduce the current sense of panic, partly by making it more difficult for the media to purvey scare stories and for authorities to justify draconian non-pharmaceutical interventions. It’s no exaggeration to say that anything that might keep the authoritarians at bay should be a public health priority.

Joe Biden’s Fat Cooked-Goose Tax Plan

03 Saturday Apr 2021

Posted by in Fiscal policy, Taxes

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I recently wrote on this blog about the damaging impact of corporate taxes on workers, consumers, and U.S. competitiveness. Phil Kerpen tweeted the chart above showing the dramatic reduction in the distribution of corporate tax rates across the world from 1980 through 2020. Yes, yes, Joe Biden’s posture as a fair and sensible leader aside, most countries place great emphasis on their treatment of business income and their standing relative to trading partners.

Kerpen’s tweet was a response to this tweet by economist Justin Wolfers:

Apparently, Wolfers wishes to emphasize that Biden’s plan, which raises the statutory corporate rate from 21% to 28%, does not take the rate up to the level of the pre-Trump era. Fair enough, but compare Wolfers’ chart with Kerpen’s (from the Tax Foundation) and note that it would still put the U.S. in the upper part of the international distribution without even considering the increment from state corporate tax rates. Also note that the U.S. was near the top of the distribution in 1980, 2000, and 2010. In fact, the U.S. had the fourth highest corporate tax rate in the world in 2017, before Trump’s tax package took effect. Perhaps Biden’s proposed rate won’t be the fourth highest in the world, but it will certainly worsen incentives for domestic U.S. investment, the outlook for wage growth, and consumer prices.

And in the same thread, Wolfers said this:

That’s certainly true, but let’s talk about those “loopholes”. First, much of U.S. corporate income is “passed though” to the returns of individual owners, so corporate taxes understate the true rate of tax paid on corporate income. Let’s also remember that the corporate tax represents a double taxation of income, and as a matter of tax efficiency it would be beneficial to consolidate these taxes on individual returns.

Beyond those consideration, the repeal of any corporate tax deduction or credit would have its own set of pros and cons. As long as there is a separate tax on corporate income, there is an economic rationale for most so-called “loopholes”. Does Wolfers refer to research and development tax credits? Maybe he means deductions on certain forms of compensation, though it’s hard to rationalize treating any form of employee compensation as income taxable to the business. Then there are the massive tax subsidies extended for investments in renewable energy. Well, good for Wolfers if that last one is his gripe! The CARES Act of 2020 allowed publicly-traded companies to use losses in 2020( presumably induced by the pandemic) to offset income in prior years, rather than carrying them forward. Did Wolfers believe that to be inappropriate? I might object to that too, to the extent that the measure allows declining firms to use COVID to cloak inefficiencies. Does he mean the offshoring of income to avoid U.S. corporate taxes? Might that be related to relative tax rates?

In any case, Wolfers can’t possibly imagine that the U.S. is the only country allowing a variety of expenses to be deducted against corporate income, or credits against tax bills for various activities. So, a comparison of statutory tax rates is probably a good place to start in assessing the competitive thrust of tax policy. But effective tax rates can reveal much more about the full impact of tax policy. In 2011, a study showed that the U.S. had the second highest effective corporate tax rate in the world. Today, among developed countries, the OECD puts the U.S. roughly in the middle of the pack, close to Germany but higher than Canada, Mexico and Japan, and lower than the UK. This article from 2019 reaches the same conclusion, though the rankings and rates differ from the OECD’s calculations. So it’s not as if the U.S. is the only country to offer tax incentives, or “loopholes” in Wolfers’ preferred terminology.

The corporate tax hikes proposed by the Biden Administration are intended to fund the massive outlays in the so-called infrastucture bill, which of course has very little to do with real infrastructure. Both the tax and spending proposals are bad policy. So far, however, passage of the bill is not a given. Let’s hope all of the Republicans and at least one Democrat senator have the sense to vote it down, but I’m not optimistic. The best hope for resistance among Democrats is Joe Manchin of West Virginia, but even he has signaled his support. Biden’s appointment of Gayle Manchin to a key administration post couldn’t have hurt.

Cash Flows and Hospital Woes

10 Sunday Jan 2021

Posted by in Coronavirus, Health Care

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Here’s one of the many entertaining videos made by people who want to convince you that hospitals are overrun with COVID patients (and here is another, and here, here, and here). That assertion has been made repeatedly since early in the pandemic, but as I’ve made clear on at least two occasions, the overall system has plenty of capacity. There are certainly a few hospitals at or very near capacity, but diverting patients is a long-standing practice, and other hospitals have spare capacity to handle those patients in every state. Those with short memories would do well to remember 2018 before claiming that this winter is unique in terms of available hospital beds.

An old friend with long experience as a hospital administrator claimed that I didn’t account for staffing shortfalls in my earlier posts on this topic, but in fact the statistics I presented were all based on staffed inpatient or ICU beds. Apparently, he didn’t read those posts too carefully. Moreover, it’s curious that a hospital administrator would complain so bitterly of staffing shortfalls in the wake of widespread hospital layoffs in the spring. And it’s curious that so many layoffs would accompany huge bailouts of hospital systems by the federal government, courtesy of the CARES Act.

In fairness, hospitals suffered huge declines in revenue in the spring of 2020 as elective procedures were cancelled and non-COVID patients stayed away in droves. Then hospitals faced the expense of covering their shortfalls in PPE. We know staffing was undercut when health care workers were diagnosed with COVID, but in an effort to stem the red ink, hospitals began laying-off staff anyway just as the the COVID crisis peaked in the spring. About 160,000 staffers were laid off in April and May, though more than half of those losses had been recovered as of December.

Did these layoffs lead to a noticeable shortfall in hospital capacity? It’s hard to say because bed capacity is a squishy metric. When patients are discharged, staffed beds can ratchet down because beds might be taken “off-line”. When patients are admitted, beds can be brought back on-line. ICU capacity is flexible as well, as parts of other units can be quickly modified for patients requiring intensive care. And patient ratios can be adjusted to accommodate layoffs or an influx of admissions. Since early in the fall, occupancy has been overstated for several reasons, including a new requirement that beds in use for observation of outpatients with COVID symptoms for 8 hours or more must be reported as beds occupied. However, there are hospitals claiming that COVID is stressing capacity limits, but nary a mention of the earlier layoffs.

So where are we now in terms of staffed hospital occupancy. The screen shot below is from the HHS website and represents staffed bed utilization nationwide. 29% of capacity is open, hardly a seasonal anomaly, and there are very few influenza admissions thus far this winter, which is rather unique. 37% of ICU beds are available, and COVID patients, those admitted either “for” or “with” COVID, account for less than 18% of inpatients, though again, that includes observational beds.

Next are the 25 states with the highest inpatient bed utilization as of January 7th. Rhode Island tops the list at just over 90%, and eight other states are over 80%. In terms of ICU utilization, Georgia and Alabama are very tight. California and Arizona are outliers with respect to proportions of COVID inpatients, 41% and 38%, respectively. Finally, CA, GA, AL and AZ are all near or above 50% of ICU beds occupied by COVID patients.

So some of the states reaching the peak of their fall waves are pretty tight, and there are states with large numbers of very serious cases. Nevertheless, in all states there is variation across local hospitals to serve in relief, and it is not unusual for hospitals to suffer wintertime strains on capacity.

Los Angeles County is receiving much attention for recent COViD stress placed on hospital capacity. But it is hard to square that narrative with certain statistics. For example, Don Wolt notes that the state of California reports available ICU capacity in Southern CA of zero, but LA County has reported 10% ~ 11% for weeks. And the following chart shows that LA County occupancy remains well below it’s July peak, especially after a recent downward revision from the higher level shown by the blue dashed line.

Interestingly, the friend I mentioned said I should talk with some health system CEOs about recent occupancies. He overlooked the fact that I quoted or linked to comments from some system CEOs in my earlier posts (linked above). It’s noteworthy that one of those CEOs, and this report from the KPI Institute, propose that an occupancy rate of 85% is optimal. This medical director prefers a 75% – 85% rate, depending on day of week. These authors write that there is no one “optimal” occupancy rate, but they seem to lean toward rates below 85%. This paper reports a literature search indicating ICU occupancy of 70% -75% is optimal, while noting a variety of conditions may dictate otherwise. Seasonal effects on occupancy are of course very important. In general, we can conclude that hospital utilization in most states is well within acceptable if not “optimal” levels, especially in the context of normal seasonal conditions. However, there are a few states in which some hospitals are facing tight capacity, both in total staffed beds and in their ICUs.

None of this is to minimize the challenges faced by administrators in managing hospital resources. No real crisis in hospital capacity exists currently, though hospital finances are certainly under stress. Yes, hospitals collect greater reimbursements on COVID patients via the CARES Act, but COVID patients carry high costs of care. Also, hospitals have faced steep declines in revenue from the fall-off in other care, high costs in terms of PPE, specialized equipment and medications, and probably high temporary staffing costs in light of earlier layoffs and short-term losses of staff to COVID infections. The obvious salve for many of these difficulties is cash, and the most promising source is public funding. So it’s unsurprising that executives are inclined to cry wolf about a capacity crisis. It’s a simple story and more appealing than pleading for cash, and it’s a scare story that media are eager to push.

Most Hospitals Have Ample Capacity

05 Saturday Dec 2020

Posted by in Coronavirus, Health Care

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Let’s get one thing straight: when you read that “hospitalizations have hit record highs”, as the Wall Street Journal headline blared Friday morning, they aren’t talking about total hospitalizations. They reference a far more limited set of patients: those admitted either “for” or “with” COVID. And yes, COVID admissions have increased this fall nationwide, and especially in certain hot spots (though some of those are now coming down). Admissions for respiratory illness tend to be highest in the winter months. However, overall hospital capacity utilization has been stable this fall. The same contrast holds for ICU utilization: more COVID patients, but overall occupancy rates have been fairly stable. Several factors account for these differing trends.

Admissions and Utilization

First, take a look at total staffed beds, beds occupied, and beds occupied by COVID patients (admitted “for” or “with” COVID), courtesy of Don Wolt. Notice that COVID patients occupied about 14% of all staffed beds over the past week or so, and total beds occupied are at about 70% of all staffed beds.

Is this unusual? Utilization is a little high based on the following annual averages of staffed-bed occupancy from Statista (which end in 2017, unfortunately). I don’t have a comparable utilization average for the November 30 date in recent years. However, the medical director interviewed at this link believes there is a consensus that the “optimal” capacity utilization rate for hospitals is as high as 85%! On that basis, we’re fine in the aggregate!

The chart below shows that about 21% of staffed Intensive Care Unit (ICU) beds are occupied by patients having COVID infections, and 74% of all ICU beds are occupied.

Here’s some information on the regional variation in ICU occupancy rates by COVID patients, which pretty much mirror the intensity of total beds occupied by COVID patients. Fortunately, new cases have declined recently in most of the states with high ICU occupancies.

Resolving an Apparent Contradiction

There are several factors that account for the upward trend in COVID admissions with stable total occupancy. Several links below are courtesy of AJ Kay:

  • The flu season has been remarkably light, though outpatients with symptoms of influenza-like illness (ILI) have ticked-up a bit in the past couple of weeks. Still, thus far, the light flu season has freed up hospital resources for COVID patients. Take a look at the low CDC numbers through the first nine weeks of the current flu season (from Phil Kerpen):
  • There is always flexibility in the number of staffed beds both in ICUs and otherwise. Hospitals adjust staffing levels, and beds are sometimes reassigned to ICUs or from outpatient use to inpatient use. More extreme adjustments are possible as well, as when hallways or tents are deployed for temporary beds. This tends to stabilize total bed utilization.
  • The panic about the fall wave of the virus sowed by media and public officials has no doubt “spooked” individuals into deferring care and elective procedures that might require hospitalization. This has been an unfortunate hallmark of the pandemic with terrible medical implications, but it has almost surely freed-up capacity.
  • COVID beds occupied are inflated by a failure to distinguish between patients admitted “for” COVID-like illness (CLI) and patients admitted for other reasons but who happen to test positive for COVID — patients “with” COVID (and all admissions are tested).
  • Case inflation from other kinds of admissions is amplified by false positives, which are rife. This leads to a direct reallocation of patients from “beds occupied” to “COVID beds occupied”.
  • In early October, the CDC changed its guidelines for bed counts. Out-patients presenting CLI symptoms or a positive test, and who are assigned to a bed for observation for more than eight hours, were henceforth to be included in COVID-occupied beds.
  • Also in October, the FDA approve an Emergency Use Authorization for Remdesivir as a first line treatment for COVID. That requires hospitalization, so it probably inflated COVID admissions.
  • The CDC also announced severe penalties in October for facilities which fail to meet its rather inclusive COVID reporting requirements, creating another incentive to capture any suspected COVID case in its reports.

In addition to the above, let’s not forget: early on, hospitals were given an incentive to diagnose patients with COVID, whether tested or merely “suspected”. The CARES Act authorized $175 billion dollars for hospitals for the care of COVID patients. In the spring and even now, hospitals have lost revenue due to the cancellation of many elective procedures, so the law helped replace those losses (though the distribution was highly uneven). The point is that incentives were and still are in place to diagnose COVID to the extent possible under the law (with a major assist from false-positive PCR tests).

Improved Treatment and Treatment

While more COVID patients are using beds, they are surviving their infections at a much higher rate than in the spring, according to data from FAIR Health. Moreover, the average length of their hospital stay has fallen by more than half, from 10.5 to 4.6 days. That means beds turn over more quickly, so more patients can be admitted over a week or month while maintaining a given level of hospital occupancy.

The CDC just published a report on “under-reported” hospitalization, but as AJ Kay notes, it can only be described as terrible research. Okay, propaganda is probably a better word! Biased research would be okay as well. The basic idea is to say that all non-hospitalized, symptomatic COVID patients should be counted as “under-counted” hospitalizations. We’ve entered the theater of the absurd! It’s certainly true that maxed-out hospitals must prioritize admissions based on the severity of cases. Some patients might be diverted to other facilities or sent home. Those decisions depend on professional judgement and sometimes on the basis of patient preference. But let’s not confuse beds that are unoccupied with beds that “should be occupied” if only every symptomatic COVID patient were admitted.

Regional Differences

Finally, here’s a little more information on regional variation in bed utilization from the HealthData.gov web site. The table below lists the top 25 states by staffed bed utilization at the end of November. A few states are highlighted based on my loose awareness of their status as “COVID “hot spots” this fall (and I’m sure I have overlooked a couple. Only two states were above 80% occupancy, however.

The next table shows the 25 states with the largest increase in staffed bed utilization during November. Only a handful would appear to be at all alarming based on these increases, but Missouri, for example, at the top of the list, still had 27% of beds unoccupied on November 30. Also, 21 states had decreases in bed utilization during November. Importantly, it is not unusual for hospitals to operate with this much headroom or less, which many administrators would actually prefer.

Of course, certain local markets and individual hospitals face greater capacity pressures at this point. Often, the most crimped situations are in small hospitals in underserved communities. This is exacerbated by more limited availability of staff members with school-age children at home due to school closures. Nevertheless, overall needs for beds look quite manageable, especially in view of some of the factors inflating COVID occupancy.

Conclusion

Marc Boom, President and CEO of Houston Methodist Hospital, had some enlightening comments in this article:

“Hospital capacity is incredibly fluid, as Boom explained on the call, with shifting beds and staffing adjustments an ongoing affair. He also noted that as a rule, hospitals actually try to operate as near to capacity as possible in order to maximize resources and minimize cost burdens. Boom said numbers from one year ago, June 25, 2019, show that capacity was at 95%.”

So there are ample beds available at most hospitals. A few are pinched, but resources can and should be devoted to diverting serious COVID cases to other facilities. But on the whole, the panic over hospital capacity for COVID patients is unwarranted.

Fall Coronavirus Season

16 Friday Oct 2020

Posted by in Coronavirus, Pandemic, Uncategorized

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We’ve known for some times that COVID-19 (C19) follows seasonal patterns typical of the flu, though without the flu’s frequent antigenic drift. Now that we’re moving well into autumn, we’ve seen a surge in new C19 case counts in Europe and in a number of U.S. states, especially along the northern tier of the country.

The new case surge began in early to mid-September, depending on the state, and it’s been coincident with another surge in tests. From late July through early October, we had a near doubling in the number of tests per positive in the U.S. An increase in tests also accompanied the previous surge during the summer, which claimed far fewer lives than the initial wave in the early spring. In the summer, infections were much more prevalent among younger people than in the spring. Vitamin D levels were almost certainly higher during the summer months, our ability to treat the virus had also improved, and immunities imparted by prior infections left fewer susceptible individuals in the population. We have many of those advantages now, but D levels will fade as the fall progresses.

As for the new surge in cases, another qualification is that false positives are still a major testing problem; they inflate both case counts and C19-attributed deaths. In the absence of any improvement in test specificity, of which there is no evidence, the exaggeration caused by false positives grows larger as testing increases and positivity rates fall. So take all the numbers with that as a caveat.

How deadly will the virus be this fall? So far in Europe, the trends look very promising. Kyle Lamb provided the following charts from WHO on Twitter yesterday. (We should all be grateful that Twitter hasn’t censored Kyle yet, because he’s been a force in exposing alarmism in the mainstream media and among the public health establishment.) Take a look at these charts, and note particularly the lag between the first wave of infections and deaths, as well as the low counts of deaths now:

If the lag between diagnosis and death is similar now to the spring, Europe should have seen a strong upward trend in deaths by now, yet it’s hardly discernible in most of those countries. The fatality rates are low as well:

As Lamb notes, the IFRs in the last column look about like the flu, though again, the reporting of deaths and their causes are often subject to lags.

What about the U.S.? Nationwide, C19 cases and attributed death reports declined after July. See the chart below. More recently, reported deaths have stabilized at under 700 per day. Note again the relatively short lags between turns in cases and deaths in both the spring and summer waves.

Clearly, there has been no acceleration in C19 deaths corresponding to the recent trend in new cases. Northeastern states that had elevated death rates in the spring saw no resurgence in the summer; southern states that experienced a surge in the summer have now enjoyed taperings of both cases and deaths. But with each season, the virus seems to roll to regions that have been relatively unscathed to that point. Now, cases are surging in the upper Midwest and upper mountain states, though some of these states are lightly populated and their data are thin.

A few state charts are shown below, but trends in deaths are very difficult to tease out in some cases. First, here are new cases and reported deaths in Michigan, Wisconsin, and Minnesota. There is a clear uptrend in cases in these states along with a very slight rise in deaths, but reported deaths are very low.

Next are Idaho, Montana, North Dakota, and South Dakota. A slight uptrend in cases began as early as August. Idaho and Montana have had few deaths, so they are not plotted in the second chart. The Dakotas have had days with higher reported deaths, and while the data are thin and volatile, the visual impression is definitely of an uptrend in deaths.

The following states are somewhat more central in latitude: Colorado, Illinois, and Ohio. There is a slight upward trend in new cases, but not deaths. Illinois is experiencing its own second wave in cases.

Out of curiosity, I also plotted Massachusetts, Pennsylvania, and New Jersey, all of which suffered in the first wave during the spring. They are now experiencing uptrends in cases, especially Massachusetts, but deaths have been restrained thus far.

The upshot is that states having little previous exposure to the virus are seeing an uptrend in deaths this fall. The same does not seem to be happening in states with significant prior exposure, at least not yet.

There are major questions about the reasons for the lingering death counts in the U.S.. But consider the following: first, the infection fatality rate (IFR) keeps falling, despite the stubborn level of daily reported deaths. Second, deaths reported have increasingly been pulled forward from deaths that actually occurred in the more distant past. This sort of “laundering” lends the appearance of greater persistence in deaths than is real. Third, again, false positives exaggerate not just cases, but also C19 deaths. Hospitals test everyone admitted, and patients who test positive for C19 are reimbursed at higher rates under the CARES Act; Medicare reimburses at a higher rates for C19 patients as well.

We’re definitely seeing a seasonal upswing in C19 infections in the US., now going on five weeks. In Europe, the surge in cases began slightly earlier. However, in both Europe and the U.S., these new cases have not yet been associated with a meaningful surge in deaths. The exceptions in the U.S. are the low-density upper mountain states, which have had little prior exposure to the virus. The lag between cases and deaths in the spring and summer was just two to three weeks, and while it’s too early to draw conclusions, the absence of a surge in deaths thus far bodes well for the IFR going forward. If we’re so fortunate, we can thank a combination of factors: a younger set of infecteds, earlier detection, better treatment and therapeutics, lower viral loads, and a subset of individuals who have already gained immunity.

Trump and Coronavirus

26 Tuesday May 2020

Posted by in Pandemic, Public Health, Risk Management, Stimulus, Trump Administration

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It’s a bit early to fully evaluate President Trump’s performance in dealing with the coronavirus pandemic, but there are a number of criteria on which I might assign marks. I’ll address some of those below, but in so doing I’m reminded of Jerry Garcia’s quip that he was “shopping around for something no one will like.” That might be how this goes. Of course, many of the sub-topics are worthy of lengthier treatment. The focus here is on the pandemic and not more general aspects of his performance in office, though there is some unavoidable overlap.

General “Readiness”

Many have criticized the Trump Administration for not being “ready” for a pandemic. I assign no grade on that basis because absolutely no one was ready, at least not in the West, so there is no sound premise for judgement. I also view the very general charge that Trump did not provide “leadership” as code for either “I don’t like him”, or “he refused to impose more authoritarian measures”, like a full-scale nationwide lockdown. Such is the over-prescriptive instinct of the Left.

Equally misleading is the allegation that Trump had “disbanded” the White House pandemic response team, and I have addressed that here. First, while the NSC would play a coordinating role, pandemic response is supposed to be the CDC’s job, when it isn’t too busy with diseases of social injustice to get it done. Second, it was John Bolton who executed a reorganization at the NSC. There were two high profile departures from the team in question at the time, and one one was a resignation. Most of the team’s staff remained with the NSC with the same duties as before the reirganization.

Finally, there was the matter of a distracting impeachment on false charges. This effort lasted through the first three years of Trump’s administration, finally culminating in January 2020. Perhaps the Administration would have had more time to focus on what was happening in China without the histrionics from the opposition party. So whatever else I might say below, these factors weigh toward leniency in my appraisal of Trump’s handing of the virus.

Messaging: C

As usual, Trump’s messaging during the pandemic was often boorish and inarticulate. His appearances at coronavirus briefings were no exception, often cringeworthy and sometimes featuring misinterpretations of what his team of experts was saying. He was inconsistent in signaling optimism and pessimism, as were many others such as New York Governor Andrew Cuomo and New York City Mayor Bill De Blasio. It shifted from “the virus is about like the flu” in February to a more sober assessment by mid-March. This was, however, quite consistent with the messaging from Dr. Anthony Fauci over the same time frame, as well as the World Health Organization (WHO). Again, no one really knew what to expect, so it’s understandable. A great deal of that can be ascribed to “the fog of war”.

Delegation and Deference: B

Trump cannot be accused of ignoring expert advice through the episode. He was obviously on-board with Fauci, Dr. Deborah Birx, Dr. Robert Redfield, and other health care advisors on the “15 Days to Slow the Spread” guidelines issued on March 16. His messaging wavered during those 15 days, expressing a desire to fully reopen the nation by Easter, which Vice President Michael Pence later described as “aspirational”. Before the end of March, however, Trump went along with a 30-day extension of the guidelines. Finally, by mid-April, the White House released guidelines for “Opening Up America Again“, which was a collaboration between Trump’s health care experts and the economic team. Trump agreed that the timeline for reopening should be governed by “the data”. There is no question, however, that Trump was chomping at the bit for reopening at several stages of this process. I see value in that positioning, as it conveys an intent to reopen asap and that people should have confidence in progress toward that goal.  

International Travel Bans: A

If anyone wonders why the world was so thoroughly blindsided by the coronavirus, look no further than China’s failure to deliver a proper warning as 2019 drew to a close. Wuhan, China was ground zero; the virus spread to the rest of the world with travelers out of Wuhan and other Chinese cities. The White House announced severe restrictions on flights from China on January 31, including a two-week quarantine for returning U.S. citizens. In retrospect, it wasn’t a minute too soon, yet for that precaution, Trump was attacked as a racist by the Left. In early February, WHO actually said travel bans were unnecessary, among other missteps. Other bans were instituted on entry from Iran and Brazil, as well as entry from Europe in early March, as countries around the globe closed their borders. Trump’s actions on incoming travelers were prescient, so I’ll score this one for Trump. Some of these travel restrictions can and should be eased now, and certainly that is expected in coming months, so we’ll see how well that process is managed.

Deference to States: A-

As a federalist, I was pleased that Trump and his team left most of the specifics on closures and bans on public gatherings up to state and local governments. That allowed more targeted mitigation efforts as dictated by local conditions and, to some extent, public opinion. This is a classic case of “laboratory federalism” whereby the most effective policies can be identified, though as we’ve seen, there’s no guarantee less successful states will emulate them. I grade Trump well on this one.

On reopening, too, Trump has been a consistent advocate of allowing flexility where local conditions permit, though he wrongly claimed he had “total authority” over ending social distancing rules. It’s hard to square that remark with his general stand on the issue of autonomy except as a tactic to strong-arm certain governors on other points.   

CDC/FDA Snafus: D

I applaud the Administration for its emphasis on the salutary effects of deregulation, but Trump went along with some major pieces of “expert advice” that were not only poor from regulatory perspective, but an affront to federalism. One was a directive issued by the CDC to delay “all elective surgeries, non-essential medical, surgical, and dental procedures during the 2019 Novel Coronavirus (COVID-19) outbreak“. (See my post “Suspending Medical Care in the Name of Public Health“.)

This is exactly the kind of “one size fits all” regulatory policy that has proven so costly, sacrificing not just economic activity but lives and care for the sick, creating avoidable illnesses and complications. The idea was to assure that adequate health care resources were available to treat an onslaught of coronavirus patients, but that was unneeded in most jurisdictions. And while the contagion was in it’s early “exponential” phase at the time, a more nuanced approach could have been adopted to allow different geographic areas and facilities more discretion, especially for different kinds of patients, or perhaps something less than a complete suspension of care. In any case, the extensions into May were excessive. I must grade Trump poorly for allowing this to happen, despite what must have been extreme pressure to follow “expert advice” on the point and the others discussed earlier.

That’s not the only point on which I blame Trump for caving to the CDC. In a case of massive regulatory failure, the CDC and FDA put the U.S. well over a month behind on testing when the first signs of the virus appeared here. Not only did they prohibit private labs and universities from getting testing underway, insisting on exclusive use of the CDC’s own tests, they also distributed faulty tests in early February that took over a month to replace. The FDA also enforced barriers to imported N95-type masks during the pandemic. Trump tends to have a visceral understanding of the calcifying dangers of regulation, but he let the so-called “experts” call the shots here. Big mistake, and Trump shares the blame with these agencies.  

Health Resources: B-

Managing the emergency distribution of PPE and ventilators to states did not go as smoothly as might have been hoped. The shortage itself left FEMA with the unenviable task of allocating quantities that could never satisfy all demands. A few states were thought to have especially acute needs, but there was also an obligation to hold stockpiles against potential requests from other states. In fact, a situation of this kind creates an incentive for states to overstate their real needs, and there are indications that such was the case. Trump sparred with a few governors over these allocations. There is certainly blame to be shared, but I won’t grade Trump down for this.

Vaccines and Treatments: C+

 

The push to develop vaccines might not achieve success soon, if ever, but a huge effort is underway. Trump gets some of the credit for that, as well as the investment in capacity now to produce future vaccine candidates in large quantities. As for treatments, he was very excited about the promise of hydroxychloraquine, going so far as to take it himself with zinc, a combination for which no fully randomized trial results have been reported (the recent study appearing in the Lancet on HCQ taken by itself has been called into question). Trump also committed an unfortunate gaffe when the DHS announced the results of a study showing that sunlight kills coronavirus in a matter of minutes, as do bleach and other disinfectants. Trump mused that perhaps sunlight or some form of disinfectant could be used as a treatment for coronavirus patients. He might have been thinking about an old and controversial practice whereby blood is exposed to UV light and then returned to the body. Later, he said he used the term “disinfectant” sarcastically, but he probably meant to say “euphemistically” …. I’m not sure he knows the difference. In any case, his habit of speculating on such matters is often unhelpful, and he loses points for that.

Fiscal Policy: B

The several phases of the economic stimulus program were a collaboration between the Trump Administration and Congress. A reasonably good summary appears here. The major parts were the $2.3 trillion CARES Act in late March and a nearly $500 billion supplemental package in late April. These packages were unprecedented in size. Major provisions were direct cash payments and the Paycheck Protection Program (PPP), which provides loans and grants to small businesses. The execution of both was a bit clunky, especially PPP, which placed a burden on private banks to extend the loans but was sketchy in terms of qualifications. The extension of unemployment compensation left some workers with more benefits than they earned in their former jobs, which could be an impediment to reopening. There were a number of other reasonable measures in these packages and the two smaller bills that preceded them in March. A number of these measures were well-targeted and inventive, such as waiving early withdrawal penalties from IRA and 401(k) balances. The Trump Administration deserves credit for helping to shape these efforts as well as others taken independently by the executive branch. 

Trump’s proposal to suspend payroll taxes did not fly, at least not yet. The idea is to reduce the cost of hiring and increase the return to work, if only temporarily. This is not a particularly appealing idea because so much of the benefits would flow to those who haven’t lost their jobs. It could be improved if targeted at new hires and rehires, however.

Trump’s proposal to grant liability waivers to reopened private businesses is extremely contentious, but one I support. Lockdowns are being eased under the weight of often heavy public and private regulation of conduct. As John Cochrane says in “Get Ready for the Careful Economy“: 

“One worry on regulation is that it will provide a recipe for a wave of lawsuits. That may have been a reason the Administration tried to hold back CDC guidance. A long, expensive, and impractical list of things you must do to reopen is catnip when someone gets sick and wants to blame a business. Show us the records that you wiped down the bathrooms every half hour. A legal system that can sue over talcum powder is not above this.”

Indeed, potential liability might represent a staggering cost to many businesses, one that might not be insurable. Accusations of negligence, true or false, can carry significant legal costs. Customers and employees, not just businesses, must accept some of the burden of risks of doing business. I give Trump good marks for this one, but we’ll see if it goes anywhere.

Some of the proposals for new stimulus legislation from democrats are much worse, including diversity initiatives, massive subsidies for “green” technologies, and bailouts for state and local government for unfunded pension liabilities. None of these has anything to do with the virus. The burden of pension shortfalls in some states should not fall on taxpayers nationwide, but on the states that incurred them. The Trump Administration and congressional Republicans should continue resisting these opportunistic proposals.

The Grade

Without assigning weights to the sub-topics covered above, I’d put the overall grade for Trump and his Administration’s handling of matters during the pandemic at about a B-, thus far. When it comes to politics, it’s often unfair to credit or blame one side for the promulgation of an overall set of policies. Nevertheless, I think it’s fair to say that Trump, could have done much better and could have done much worse. We will learn more with the passage of time, the continued evolution of the virus, the development of treatments or vaccines, and the course of the economy.