The Department of Justice today announced criminal charges against 36 defendants in 13 federal districts across the United States for more than $1.2 billion in alleged fraudulent telemedicine, cardiovascular and cancer genetic testing, and durable medical equipment (DME) schemes.
The nationwide coordinated law enforcement action includes criminal charges against a telemedicine company executive, owners and executives of clinical laboratories, durable medical equipment companies, marketing organizations, and medical professionals.
US Department of Justice, above; Wikimedia Commons
Additionally, the Centers for Medicare & Medicaid Services (CMS), Center for Program Integrity (CPI) announced today that it took adverse administrative actions against 52 providers involved in similar schemes. In connection with the enforcement action, the department seized over $8 million in cash, luxury vehicles, and other fraud proceeds.
“The Department of Justice is committed to prosecuting people who abuse our health care system and exploit telemedicine technologies in fraud and bribery schemes,” said Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division. “This enforcement action demonstrates that the department will do everything in its power to protect the health care systems our communities rely on from people looking to defraud them for their own personal gain.”
The coordinated federal investigations announced today primarily targeted alleged schemes involving the payment of illegal kickbacks and bribes by laboratory owners and operators in exchange for the referral of patients by medical professionals working with fraudulent telemedicine and digital medical technology companies. Telemedicine schemes account for more than $1 billion of the total alleged intended losses associated with today’s enforcement action. These charges include some of the first prosecutions in the nation related to fraudulent cardiovascular genetic testing, a burgeoning scheme. As alleged in court documents, medical professionals made referrals for expensive and medically unnecessary cardiovascular and cancer genetic tests, as well as durable medical equipment. For example, cardiovascular genetic testing was not a method of diagnosing whether an individual presently had a cardiac condition and was not approved by Medicare for use as a general screening test for indicating an increased risk of developing cardiovascular conditions in the future.
“Protecting the American people is at the forefront of the FBI’s mission,” said Assistant Director Luis Quesada of the FBI’s Criminal Investigative Division. “Fraudsters and scammers take advantage of telemedicine and use it as a platform to orchestrate their criminal schemes. This collaborative law enforcement action shows our dedication to investigating and bringing to justice those who look to exploit our U.S. health care system at the expense of patients.”
“Today’s enforcement action highlights our dedication to fighting health care fraud and investigating individuals who target Medicare beneficiaries and steal from taxpayers for personal gain,” said Inspector General Christi A. Grimm of the U.S. Department of Health and Human Services. “HHS-OIG is proud to work alongside our law enforcement partners to disrupt fraud schemes that use the guise of telehealth to expand the reach of kickback schemes designed to cheat federally funded health care programs.”
One particular case charged involved the operator of several clinical laboratories, who was charged in connection with a scheme to pay over $16 million in kickbacks to marketers who, in turn, paid kickbacks to telemedicine companies and call centers in exchange for doctors’ orders. As alleged in court documents, orders for cardiovascular and cancer genetic testing were used by the defendant and others to submit over $174 million in false and fraudulent claims to Medicare—but the results of the testing were not used in treatment of patients. The defendant allegedly laundered the proceeds of the fraudulent scheme through a complex network of bank accounts and entities, including to purchase luxury vehicles, a yacht, and real estate. The indictment seeks forfeiture of over $7 million in United States currency, three properties, the yacht, and a Tesla and other vehicles.
Some of the defendants charged in this enforcement action allegedly controlled a telemarketing network, based both domestically and overseas, that lured thousands of elderly and/or disabled patients into a criminal scheme. The owners of marketing organizations allegedly had telemarketers use deceptive techniques to induce Medicare beneficiaries to agree to cardiovascular genetic testing, and other genetic testing and equipment.
Kaiser Health News: In Some States, Voters Will Get to Decide the Future of Abortion Rights
As states grapple with the future of abortion in the U.S., Michigan, California, and Vermont could become the first states to let voters decide whether the right to abortion should be written into the state constitution.
Wikimedia Commons, right
In Michigan, a proposed constitutional amendment would override a 90-year-old state law that makes abortion a felony even in cases of rape or incest. The U.S. Supreme Court’s overturning of Roe v. Wade last month could revive that abortion ban — and has galvanized abortion-rights advocates to secure new protections.
Some of the momentum is coming from activists getting involved for the first time.
“I wanted to do something, but I had no political experience or really any experience in activism,” said Amanda Mazur, who lives in rural northwestern Michigan. “But I thought, ‘Maybe I can volunteer and just offer something tangible to the movement.’”
Michigan organizers like Mazur submitted more than 750,000 signatures — a record number, they said — to state election officials in hopes of having the amendment appear on the November ballot.
If just over half those signatures are validated, Michigan voters will decide whether to amend the state’s constitution to guarantee broad individual rights to “reproductive freedom” that would cover abortion, contraception, and fertility treatments. It would also prevent the state from regulating abortions later in pregnancy if the patient’s “physical or mental health” is at risk.
The ballot initiative has the backing of medical groups like the American College of Obstetricians and Gynecologists, while conservative groups have called it radical and dangerous, claiming it would “allow late-term abortions for practically any reason.”
In California, the push to expand abortion access starts from a very different vantage point: The right to abortion is protected in state statute. And voters will be asked whether they want to enshrine it in the constitution. Proposition 1, which will be on the ballot in November, would prohibit the state from interfering with Californians’ reproductive health decisions, including those related to abortion or contraception.
“I want to know for sure that that right is protected,” state Sen. Toni Atkins (D-San Diego), the Democratic leader in the Senate and lead author of the amendment, said at a legislative hearing in June. “We are protecting ourselves from future courts and future politicians.”
The amendment is one strategy that several California lawmakers are pursuing to protect abortion access in the state. Gov. Gavin Newsom, a Democrat, has signed legislation to eliminate out-of-pocket expenses for abortion for most Californians and to protect California providers that offer abortion services from lawsuits in other states. The recent state budget deal also includes $200 million for reproductive and abortion care.
Earlier this month, Vermont Gov. Phil Scott, a Republican, announced that Proposal 5 will be on the November ballot. He said in a statement: “In Vermont, we solidified the right to choose in law, and now Vermonters have the opportunity to further protect that right in our constitution.”
For Mazur, the desire to “do something” started in 2017, when she and her husband gave their daughter, then 2 years old, some happy news: She was going to be a big sister. The family was thrilled.
But then doctors told Mazur something was wrong.
“I found out halfway through the pregnancy that the baby my husband and I hoped for suffered from a rare and life-limiting genetic condition,” Mazur said. “We ultimately made the compassionate choice to end the pregnancy for my well-being, and for the well-being of our family, and the life of what we thought would be our child.”
Devastated, Mazur turned to a national online support group and met people having similar experiences. But many group members said they were having a tough time finding a way to terminate their pregnancies.
“It really broke my heart that you’re going through this already devastating experience but have to travel far away from your home across the country … [and] advocate for yourself like crazy just to get care that you have decided with your doctor is best for you,” Mazur said.
At the time, abortion rights in Michigan seemed pretty stable, but Mazur’s political awakening found an outlet this year.
Reproductive Freedom for All, a petition group backed by the American Civil Liberties Union of Michigan and Planned Parenthood Advocates of Michigan, was gathering signatures for the constitutional amendment to enshrine abortion protections in state law. The effort took on new urgency in May after a draft of the Supreme Court’s decision in Dobbs v. Jackson Women’s Health Organization was leaked and then published.
“Folks realized that this big, scary thing that they did not think would happen might actually happen,” said Jessica Ayoub, a field organizer with the ACLU of Michigan.
Some Michiganders were registering to vote just to be eligible to sign the petition. Jaynie Hoerauf, a 62-year-old attorney in Farwell, drove 40 miles to attend a rally where she knew she could sign it.
“A bunch of us were so ticked off [about Roe being overturned], and we were talking about it. And I was like, ‘I’m just going to go on and find where I can sign the stupid petition,’” Hoerauf said.
Activists on both sides of the abortion-rights debate expect to spend millions of dollars. They predict that donations will pour in from outside Michigan and that voters in other states will be watching.
“This is just the start of our fight,” Ayoub said. “We know that it is a long road to November.”
KHN correspondent Rachel Bluth contributed to this report.
This story is part of a partnership that includes Michigan Radio, NPR, and KHN.
KHN (Kaiser Health News) is a national newsroom that produces in-depth journalism about health issues. Together with Policy Analysis and Polling, KHN is one of the three major operating programs at KFF (Kaiser Family Foundation). KFF is an endowed nonprofit organization providing information on health issues to the nation.
Jo Freeman Writes: The Lost Promise, American Universities in the 1960s by Ellen Schrecker
By Jo Freeman
The Lost Promise: American Universities In The 1960s
Librarian of Congress Names Ada Limón the Nation’s 24th US Poet Laureate
Librarian of Congress Carla Hayden announced the appointment of Ada Limón as the nation’s 24th Poet Laureate Consultant in Poetry for 2022-2023. Limón will take up her duties in the fall, opening the Library’s annual literary season on Sept. 29 with a reading of her work in the Coolidge Auditorium.
Ada Limón, right
“Ada Limón is a poet who connects,” Hayden said. “Her accessible, engaging poems ground us in where we are and who we share our world with. They speak of intimate truths, of the beauty and heartbreak that is living, in ways that help us move forward.”
Limón joins a long line of distinguished poets who have served in the position, including Joy Harjo who served three terms in the position (2019-2022), Juan Felipe Herrera, Charles Wright, Natasha Trethewey, Philip Levine, W.S. Merwin, Kay Ryan, Charles Simic, Donald Hall, Ted Kooser, Louise Glück, Billy Collins, Stanley Kunitz, Robert Pinsky, Robert Hass and Rita Dove.
“What an incredible honor to be named the 24th Poet Laureate of the United States. Again and again, I have been witness to poetry’s immense power to reconnect us to the world, to allow us to heal, to love, to grieve, to remind us of the full spectrum of human emotion,” Limón said. “This recognition belongs to the teachers, poets, librarians and ancestors from all over the world that have been lifting up poetry for years. I am humbled by this opportunity to work in the service of poetry and to amplify poetry’s ability to restore our humanity and our relationship to the world around us.”
Ada Limón was born in Sonoma, California, in 1976 and is of Mexican ancestry. She is the author of six poetry collections, including “The Carrying” (Milkweed Editions, 2018), which won the National Book Critics Circle Award for Poetry; “Bright Dead Things” (2015), a finalist for the National Book Award and the National Books Critics Circle Award; “Sharks in the Rivers” (2010); “Lucky Wreck” (Autumn House, 2006); and “This Big Fake World” (Pearl Editions, 2006). She earned a Master of Fine Arts degree from New York University and is the recipient of fellowships from the Guggenheim Foundation, the New York Foundation for the Arts, the Provincetown Fine Arts Work Center, and the Kentucky Foundation for Women.
CDC*: US Monkeypox Outbreak 2022, Situation Summary
Overview
Everyone should take steps to protect themselves from monkeypox.
- Avoid close, skin-to-skin contact with people who have a rash that looks like monkeypox. Do not touch the rash or scabs of a person with monkeypox.
- Do not kiss, hug, cuddle, or have sex with someone with monkeypox.
- Do not share eating utensils or cups with a person with monkeypox.
- Do not handle or touch the bedding, towels, or clothing of a person with monkeypox.
- Wash your hands often with soap and water or use an alcohol-based hand sanitizer.
Anyone with a rash that looks like monkeypox should talk to their healthcare provider, even if they don’t think they had contact with someone who has monkeypox.
A person who is sick with monkeypox should isolate at home. If they have an active rash or other symptoms, they should be in a separate room or area from other family members and pets when possible.
CDC is tracking an outbreak of monkeypox that has spread across several countries that don’t normally report monkeypox, including the United States.
People with monkeypox in the current outbreak generally report having close, sustained physical contact with other people who have monkeypox. While many of those affected in the current global outbreaks are gay, bisexual, or other men who have sex with men, anyone who has been in close contact with someone who has monkeypox can get the illness.
To learn more about recommendations for those who may have had contact with someone who has monkeypox, visit Exposure Risk Assessment and Public Health Recommendations.
CDC is urging healthcare providers in the United States to be alert for patients who have rash illnesses consistent with monkeypox, regardless of whether they have travel or specific risk factors for monkeypox and regardless of gender or sexual orientation.
CDC is working with state and local health officials to identify people who may have been in contact with people who have tested positive for monkeypox, so they can monitor their health.
CDC recommends vaccination for people who have been exposed to monkeypox and people who are at higher risk of being exposed to monkeypox.
Learn more about what CDC is doing to respond to the outbreak.
What You Should Do
Everyone should take steps to protect themselves from monkeypox.
- Avoid close, skin-to-skin contact with people who have a rash that looks like monkeypox. Do not touch the rash or scabs of a person with monkeypox.
- Do not kiss, hug, cuddle, or have sex with someone with monkeypox.
- Do not share eating utensils or cups with a person with monkeypox.
- Do not handle or touch the bedding, towels, or clothing of a person with monkeypox.
- Wash your hands often with soap and water or use an alcohol-based hand sanitizer.
Anyone with a rash that looks like monkeypox should talk to their healthcare provider, even if they don’t think they had contact with someone who has monkeypox.
A person who is sick with monkeypox should isolate at home. If they have an active rash or other symptoms, they should be in a separate room or area from other family members and pets when possible.
*CDC stands for Centers for Disease Control and Prevention
NASA’s James Webb Space Telescope Delivers Deepest Infrared Image of Universe Yet
- President Joe Biden unveiled this image of galaxy cluster SMACS 0723, known as Webb’s First Deep Field, during a White House event Monday, July 11
- Webb’s image covers a patch of sky approximately the size of a grain of sand held at arm’s length by someone on the ground – and reveals thousands of galaxies in a tiny sliver of vast universe
- Webb’s sharp near-infrared view brought out faint structures in extremely distant galaxies, offering the most detailed view of the early universe to date
- NASA and its partners will release the full series of Webb’s first full-color images and data, known as spectra, Tuesday, July 12, during a live NASA TV broadcast
NASA’s James Webb Space Telescope has produced the deepest and sharpest infrared image of the distant universe to date. Known as Webb’s First Deep Field, this image of galaxy cluster SMACS 0723 is overflowing with detail.
Thousands of galaxies – including the faintest objects ever observed in the infrared – have appeared in Webb’s view for the first time. This slice of the vast universe covers a patch of sky approximately the size of a grain of sand held at arm’s length by someone on the ground.
This deep field, taken by Webb’s Near-Infrared Camera (NIRCam), is a composite made from images at different wavelengths, totaling 12.5 hours – achieving depths at infrared wavelengths beyond the Hubble Space Telescope’s deepest fields, which took weeks.
The image shows the galaxy cluster SMACS 0723 as it appeared 4.6 billion years ago. The combined mass of this galaxy cluster acts as a gravitational lens, magnifying much more distant galaxies behind it. Webb’s NIRCam has brought those distant galaxies into sharp focus – they have tiny, faint structures that have never been seen before, including star clusters and diffuse features. Researchers will soon begin to learn more about the galaxies’ masses, ages, histories, and compositions, as Webb seeks the earliest galaxies in the universe.
This image is among the telescope’s first-full color images. The full suite will be released Tuesday, July 12, beginning at 10:30 a.m. EDT, during a live NASA TV broadcast. Learn more about how to watch.
Image credit: NASA, ESA, CSA, and STScI
The James Webb Space Telescope is the world’s premier space science observatory. Webb will solve mysteries in our solar system, look beyond to distant worlds around other stars, and probe the mysterious structures and origins of our universe and our place in it. Webb is an international program led by NASA with its partners, ESA (European Space Agency) and CSA (Canadian Space Agency).
NASA Headquarters oversees the mission for the agency’s Science Mission Directorate. NASA’s Goddard Space Flight Center in Greenbelt, Maryland, manages Webb for the agency and oversees work on the mission performed by the Space Telescope Science Institute, Northrop Grumman, and other mission partners. In addition to Goddard, several NASA centers contributed to the project, including the agency’s Johnson Space Center in Houston; Jet Propulsion Laboratory (JPL) in Southern California; Marshall Space Flight Center in Huntsville, Alabama; Ames Research Center in California’s Silicon Valley; and others.
NIRCam was built by a team at the University of Arizona and Lockheed Martin’s Advanced Technology Center.
Download full-resolution, uncompressed versions at https://webbtelescope.org/contents/news-releases/2022/news-2022-038.
GAO Report: Contact Tracing for Air Travel: CDC’s Data System Needs Substantial Improvement
The U.S. Centers for Disease Control and Prevention collects information on air passengers to help local public health authorities trace the potential spread of communicable diseases (e.g., COVID-19).
But some of the ways in which CDC collects and manages passengers’ information make it harder to effectively facilitate contact tracing. For example, the outdated data management system CDC uses doesn’t allow it to connect related cases or easily report the number of passengers exposed to a single infected person on a flight.
We recommended ways to improve CDC’s air passenger data system.
What GAO Found
The Centers for Disease Control and Prevention (CDC) plays a key role in contact tracing for air travel — the process of identifying and notifying passengers who may have come into contact with a person infected with a communicable disease during a flight. However, several factors affect CDC’s ability to collect timely, accurate, and complete air passenger information to support contact tracing by local public health authorities. For example, airlines may not have accurate and complete information about passengers to share with CDC because the contact information provided to book a ticket may be for a third party, like a travel agent, not for passengers. Further, because no single, complete, and reliable source of passenger information exists, CDC often conducts research to fill in gaps, extending the time it takes to share information with local public health authorities.
Overview of Process for Collecting Air Passengers’ Contact Information
Since the start of the COVID-19 pandemic, CDC has taken some actions to improve the quality of information it collects. For example, since November 2021, CDC has required airlines to collect certain information—including name, phone number, email, and physical address—no more than 72 hours before departure from passengers traveling on flights into the United States and to transmit the information to CDC in a defined format.
However, limitations in how CDC collects and manages air passengers’ contact information — including CDC’s use of an outdated data management system—hinder the agency’s ability to monitor public health risks and facilitate contact tracing. The data management system—developed in the mid-2000s—was not designed for rapid assessment or aggregation of public health data across individual cases. For example, CDC is unable to quickly and accurately identify the number of passengers exposed to a specific infected passenger on a flight. Nor does the system contain the necessary data fields to assess the quality of air passenger information CDC receives, such as a field to determine the timeliness of airlines’ responses to CDC’s request. Consequently, CDC is not positioned to efficiently analyze and disseminate data to inform public health policies and respond to disease threats. Nor is it positioned to evaluate its performance in collecting and sharing quality passenger information.
Why GAO Did This Study
The COVID-19 pandemic has underscored the importance of public health measures aimed at controlling the transmission of communicable diseases. Air travel can play a role in quickly spreading communicable diseases across the world and throughout communities. Given this potential, contact tracing for air passengers is an important measure for protecting public health.
GAO was asked to examine CDC’s process for collecting and managing air passengers’ contact information to facilitate contact tracing. This report addresses: (1) the factors that affect CDC’s ability to collect this information, (2) recent actions CDC has taken to improve the quality of the information it collects, and (3) how effectively it collects and manages this information.
GAO reviewed relevant federal documentation, including regulations, orders, technical guidance, and public comments, as well as available CDC data. GAO also interviewed officials from CDC, U.S. Customs and Border Protection, and the Federal Aviation Administration, and selected representatives from the aviation, travel, and public health industries.
Recommendations
GAO is making three recommendations, including that CDC redesign its data management system for air passenger information or deploy a new one. CDC concurred with the recommendations.
Recommendations for Executive Action
| Agency Affected | Recommendation | Status |
|---|---|---|
| Centers for Disease Control and Prevention | The Director of CDC should implement controls for the entry of data into its Quarantine Activity Reporting System (QARS), including by providing adequate training and standard operating procedures that are documented and institutionalized for system users and by conducting consistent validation checks. (Recommendation 1) |
When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
|
| Centers for Disease Control and Prevention | The Director of CDC should assess additional opportunities to improve the quality of air passenger information it collects and manages— including opportunities to increase automation by adopting or establishing data exchange standards—and take action, as appropriate, based on this assessment. (Recommendation 2) |
When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
|
| Centers for Disease Control and Prevention | The Director of CDC should re-design QARS or deploy a new data system that would allow CDC to more effectively facilitate contact tracing for air passengers and conduct disease surveillance for air travel. (Recommendation 3) |
When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
|
Full Report
Mississippi Author Jesmyn Ward: Winner of the 2022 Library of Congress Prize for American Fiction
Jesmyn Ward. Photo: Beowulf Sheehan.
Librarian of Congress Carla Hayden announced that the 2022 Library of Congress Prize for American Fiction is awarded to Jesmyn Ward, whose lyrical works set in her native Mississippi feature the lives of Black people finding a way to endure and prevail over a world of harsh racism and violence. At 45, Ward is the youngest person to receive the Library’s fiction award for her lifetime of work.
“Jesmyn Ward’s literary vision continues to become more expansive and piercing, addressing urgent questions about racism and social injustice being voiced by Americans,” said Hayden. “Jesmyn’s writing is precise yet magical, and I am pleased to recognize her contributions to literature with this prize.”
One of the Library’s most prestigious awards, the annual Prize for American Fiction honors an American literary writer whose body of work is distinguished not only for its mastery of the art but also for its originality of thought and imagination. The award seeks to commend strong, unique, enduring voices that — throughout consistently accomplished careers — have told us something essential about the American experience.
“I am deeply honored to receive this award, not only because it aligns my work with legendary company, but because it also recognizes the difficulty and rigour of meeting America on the page, of appraising her as a lover would: clear-eyed, open-hearted, keen to empathize and connect,” Ward said. “This is our calling, and I am grateful for it.”
Hayden selected Ward as this year’s winner based on nominations from more than 60 distinguished literary figures, including former winners of the prize, acclaimed authors and literary critics from around the world. The virtual prize ceremony will take place at the Library’s 2022 National Book Festival on Sept. 3.
The fiction prize was inaugurated in 2008, recognizing Herman Wouk. Last year’s winner was Joy Williams. Other winners have included Toni Morrison, Philip Roth, Isabel Allende and E.L. Doctorow.
Ward is the acclaimed author of the novels “Where the Line Bleeds” and then two books that each won the National Book Award: “Salvage the Bones” in 2011 and “Sing, Unburied, Sing” in 2017. Her nonfiction work includes the memoir “Men We Reaped,” a finalist for the National Book Critics Circle Award, and the 2020 work “Navigate Your Stars.” Ward is also the editor of the anthology “The Fire This Time: A New Generation Speaks About Race.”
Ward is one of only six writers to receive the National Book Award more than once and the only woman and Black American to do so. Ward was the recipient of a MacArthur Fellowship in 2017 and was the John and Renée Grisham Writer in Residence at the University of Mississippi for the 2010-2011 academic year. In 2018, she was named to Time Magazine’s list of 100 most influential people in the world.
Ward lives in Mississippi and is a professor of creative writing at Tulane University.
The National Book Festival will take place Sept. 3 from 9 a.m. to 8 p.m. at the Walter E. Washington Convention Center in Washington. This will be the first time the festival has been in person since 2019. A selection of programs will be livestreamed, and recordings of all presentations can be viewed online following the festival.
A Reminder From the White House: Prepare for New Variants As We Work to Keep Ourselves Protected Against COVID-19
Prepare for New Variants
The White House
As we work to keep ourselves protected against COVID-19, America must remain prepared for any new variant that may come our way. To do so, the Administration has developed a comprehensive plan for how we monitor this virus to stay ahead of it, adapt our tools swiftly to combat a new variant, and deploy emergency resources to help communities.
Before January 2021, the federal government had insufficient data and sequencing capabilities and was ill-equipped to respond to new variants. Electronic case reporting was in place for only a handful of states in 2020 and the country could sequence only 3,000 viral isolates per week. America had no plan for responding to a new variant or standing up comprehensive efforts to respond to a surge in COVID-19 cases.
The Administration has enhanced our collection, production, and analysis of data, and expanded electronic case reporting to all 50 states, Washington D.C., Puerto Rico, and thousands of health care facilities. The CDC now tracks a range of key COVID-19 response metrics including cases, tests, vaccinations, and hospital admissions in real-time. Additionally, the CDC launched – and is continually enhancing – the National Wastewater Surveillance System (NWSS) to track the presence of SARS-COV-2 in wastewater samples collected across the country. And America has established a world-class sequencing operation, sequencing up to 90,000 isolates a week. The CDC’s sequencing efforts can now reliably detect variants that account for as little as 0.1% of all COVID-19 cases circulating in the United States. And when new variants are identified, the federal government has a network of researchers – federal, academic, and commercial – who are able to study the sequence and assess mutations rapidly, allowing the government to respond quickly to concerning variants.
The Administration has also successfully built a robust emergency response infrastructure. Our surge response – led by the Federal Emergency Management Agency (FEMA) and HHS – developed capabilities to stand up over 100 federal mass vaccination sites and federal surge testing sites; distribute millions of critical supplies; and deploy thousands of federal clinical and non-clinical personnel to support states, Tribes, and territories. Since July 2021, the federal government has deployed over 4,000 military and non-military personnel including doctors, nurses, and paramedics; sent over 3,400 ventilators, ambulances, and other critical supplies; and shipped over 115 million pieces of PPE. And over the last year, FEMA has invested $300 million in state hospital preparedness to expand hospital capacity in 38 states.
Moving forward, the Administration will maintain our proven data, sequencing, variant response, and surge response capabilities. The CDC will continue to improve COVID-19 data collection, reporting, and analysis so America is better informed and ready to respond to new variants. And if new variants emerge, the federal government will leverage established playbooks to assess a new variant’s impact on our vaccines, treatments, and tests, and rapidly deploy the tools, personnel, and resources Americans need. America will also retain a significant stockpile of tools to combat COVID-19 that remain ready for deployment.
Board of Governors: Minutes of the Federal Open Market Committee June 14–15, 2022; Consumer Price Inflation Remained Elevated
Monetary policy in the United States comprises the Federal Reserve’s actions and communications to promote maximum employment, stable prices, and moderate long-term interest rates — the economic goals the Congress has instructed the Federal Reserve to pursue. Board of Governors, June 14 – 15, 2022
Staff Review of the Economic Situation
The information available at the time of the June 14 – 15 meeting suggested that U.S. real gross domestic product (GDP) was rebounding to a moderate rate of increase in the second quarter after having declined in the first quarter. The labor market remained very tight, but there were some signs that momentum was slowing. Consumer price inflation — as measured by the 12‑month percentage change in the price index for personal consumption expenditures (PCE) — remained elevated in April, and available information suggested that inflation was still elevated in May.
Total nonfarm payroll employment rose solidly in April and May, though the pace of increase was slower than in the first quarter, and the unemployment rate remained unchanged at 3.6 percent. The unemployment rates for African Americans and for Hispanics were little changed, on net, though both rates remained noticeably higher than the national average. On net, the labor force participation rate edged down between March and May, while the employment-to-population ratio was unchanged. The private-sector job openings rate, as measured by the Job Openings and Labor Turnover Survey, edged lower in April but remained at a high level. Nominal wage growth remained elevated, with average hourly earnings having risen 5.2 percent over the 12 months ending in May, and the increases were widespread across industries.
Consumer price inflation remained elevated. Total PCE price inflation was 6.3 percent over the 12 months ending in April, and core PCE price inflation, which excludes changes in consumer energy prices and many consumer food prices, was 4.9 percent over the same period. The trimmed mean measure of 12‑month PCE price inflation constructed by the Federal Reserve Bank of Dallas was 3.8 percent in April, nearly 2 percentage points higher than its year-earlier rate of increase. In May, the 12-month change in the CPI was 8.6 percent, while core CPI inflation was 6.0 percent over the same period. Measures of inflation expectations derived from surveys of professional forecasters and of consumers generally suggested that inflation was expected to remain high in the short run but then fall back toward levels consistent with a longer-run rate of 2 percent.
Production and spending indicators were mixed but generally remained strong. Consumer spending and industrial production posted sizable gains in April. However, retail sales declined in May, data on home sales and single-family housing starts moved down in April, some indicators of manufacturing activity weakened in May, and the University of Michigan Surveys of Consumers measure of consumer sentiment decreased noticeably in the preliminary June reading. Supply disruptions appeared to have improved in some sectors (such as general merchandise retailers) but to have deteriorated in others (such as materials for home construction). On balance, the available indicators suggested that private domestic final purchases were increasing at a slower pace in the second quarter than in the first quarter. And with the available trade data for April pointing to a rebound in exports and a moderation in import growth in the second quarter, GDP growth appeared to be rebounding after having declined in the first quarter.
Regarding trade, real imports of goods stepped back in April from their exceptional strength in March, driven by a decline in consumer goods imports. By contrast, real goods exports grew in both March and April after declining in the previous two months, following some normalization in categories such as soybeans and pharmaceuticals, which can exhibit large and idiosyncratic changes. Exports and imports of services continued to be held back by an incomplete recovery of international travel. The nominal U.S. international trade deficit widened to a record size in March and then reversed that widening in April.
Incoming data suggested that the global reverberations from lockdown measures to deal with the spread of the COVID-19 virus in China and the Russian invasion of Ukraine slowed foreign economic growth. In China, activity indicators pointed to a sizable restraint on economic activity. The Russian invasion of Ukraine continued to have an imprint on foreign activity, with persistent stresses in global commodity markets and declining consumer and business confidence, especially in Europe. Inflation abroad moved higher, driven by further increases in consumer energy and food prices as well as some additional broadening of price pressures to core goods and services. Central banks around the world further tightened their monetary policy stances to curb high inflation.
Staff Review of the Financial Situation
Over the intermeeting period, U.S. Treasury yields and the market-implied federal funds rate path moved substantially higher on net. Broad domestic equity price indexes declined considerably, on balance, amid elevated market volatility. In most advanced foreign economies (AFEs), sovereign yields also increased further, and foreign equity price indexes moved lower. Despite further increases in borrowing costs, financing conditions in domestic credit markets remained generally accommodative. The credit quality of firms, municipalities, and households remained largely stable, although the outlook for credit quality had begun to deteriorate somewhat.
Since the previous FOMC meeting, 2-, 5-, and 10-year nominal Treasury yields increased considerably on net. Early in the intermeeting period, Treasury yields moved lower amid rising concerns about a weakening U.S. growth outlook and Federal Reserve communications perceived as lowering the chances of large policy rate hikes at upcoming meetings. However, yields increased late in the period, with economic data releases largely being interpreted as highlighting the possibility of a more aggressive tightening of monetary policy. The expected federal funds rate path—implied by a straight read of overnight index swap quotes—also increased notably on balance. Real yields increased more than their nominal counterparts, while inflation compensation implied by Treasury Inflation-Protected Securities declined.
Broad equity price indexes fell sharply over the intermeeting period on net. The stock price declines were largely associated with mixed corporate earnings news early in the period and increasing concerns about the economic outlook amid global policy tightening. One-month option-implied volatility on the S&P 500 index—the VIX—increased moderately, on balance, remaining elevated relative to its historical distribution and significantly above average pre-pandemic levels. Spreads on investment-grade and, to a greater extent, speculative-grade corporate bonds widened notably, on net, reaching levels comparable with those at the end of 2018. This widening of spreads was associated with increased concerns about the outlook for corporate credit amid monetary policy tightening. Since the previous FOMC meeting, spreads on municipal bonds narrowed substantially, on net, moving near levels observed for several years before the pandemic, as investor demand exhibited some recovery over much of the period from earlier weak levels.
Conditions in short-term funding markets remained stable over the intermeeting period, with the May increase in the Federal Reserve’s administered rates passing through promptly to overnight money market rates. Spreads on longer-tenor commercial paper (CP) and negotiable certificates of deposit narrowed moderately, with no signs of spillovers beyond the stablecoin market following the collapse of a large algorithmic stablecoin. Indeed, CP outstanding increased slightly over the period. Money market fund (MMF) net yields across all fund types rose notably, as increases in administered rates passed through to money market instruments. Secured overnight rates softened significantly relative to the ON RRP offering rate since the May FOMC meeting, with the downward pressure on rates attributed to continuing declines in net Treasury bill issuance, elevated demand for collateral in the form of Treasury securities, and MMFs maintaining very short portfolio maturities amid uncertainty about the pace of anticipated policy rate increases. Consistent with the downward pressure on repo rates, daily take-up in the ON RRP facility increased further.
Sovereign yields in most AFEs rose over the intermeeting period amid investors’ concerns about further inflationary pressures and major central banks’ policy communications suggesting a firmer stance of policy. Interest rate volatility in AFEs increased, consistent with increased uncertainty about the path of policy rates. Concerns about the global growth outlook weighed on equity prices, and the broad dollar edged up. Implied equity price volatility remained at elevated levels. Japanese yields and equity prices, however, ended the period about unchanged, as the BOJ reaffirmed its accommodative monetary policy stance. Sovereign bond spreads over German bund yields for euro-area peripheral countries widened further. These moves were partially retraced following an unscheduled meeting of the ECB on June 15, at which the ECB indicated that it would take action to address potential fragmentation risk in euro-area sovereign bond markets. Outflows from emerging market-dedicated funds intensified in early May, especially from local currency bond funds, and credit spreads in emerging market economies widened moderately.
In domestic credit markets, financing conditions for most businesses and households remained generally accommodative over the intermeeting period. Credit remained widely available, particularly to higher-rated firms and consumers with higher credit scores. Gross nonfinancial corporate bond issuance slowed in May, especially among speculative-grade issuers, amid elevated market volatility and high yields. Gross institutional leveraged loan issuance decelerated and initial public offering volumes remained extremely slow in May, while gross issuance of municipal bonds remained robust.