November 22, 2019
President Trump signed a four-week Continuing Resolution spending bill into law yesterday putting a potential government shutdown off until Dec. 20th with a number of healthcare extenders. The continuing resolution would delay a scheduled $4 billion reduction in fiscal 2020 Medicaid funding for disproportionate share hospitals (DSH) until Dec. 20, extend a 100% federal Medicaid match rate for Puerto Rico and other U.S. territories for the duration of the continuing resolution, extend funding for a number of Medicaid programs until Dec. 20th, increases funds for the Ebola outbreak response, extend for a number of community health programs at current levels until Dec. 20th, and reduce funds available to the Medicaid Improvement Fund for fiscal 2025 and thereafter to $1.96 billion, from $2.39 billion currently.
It appears that President Trump has had a reversal on his proposed flavored e-cigarette ban. It was expected that the proposed guidance would be released after the Office of Management and Budget finished reviewing the guidance, but President Trump never signed-off on the proposed guidance and the banned flavored e-cigarette guidance is no longer on the Department of Health & Human Services agency list for the coming year. We are hearing that an aggressive push by the vaping industry and polling numbers in battleground states impacted President Trump’s decision making. President Trump will be meeting with vaping critics and supporters today at the White House as they continue to decide how to move forward on e-cigarette regulations. Among those meeting with President Trump include representatives from Altria, Howard Willard and Reynolds, the Campaign for Tobacco-Free Kids, the Campaign for Tobacco-Free Kids, the Vapor Technology Association, and Americans for Tax Reform. This week, the House Energy and Commerce Committee passed Energy and Commerce Chairman Frank Pallone’s (D-NJ) and Rep. Donna Shalala’s (D-FL) bill that seeks to end the youth tobacco epidemic. The bill passed on a 28-24 vote mostly along party lines. The bill would ban flavored tobacco products, raise the purchasing age to 21 nationwide, and ban online sales in a bid to curb teen tobacco use, particularly of vaping products.
The Senate Health, Education, Labor, and Pensions (HELP) Committee held its confirmation hearing for Stephen Hahn, the Trump administration’s nominee to head the Food and Drug Administration (FDA). Both Democrats and Republicans pushed Hahn on the Trump administration’s backtracking of the flavored e-cigarette ban with Hahn promising bold action on vaping but failing to give an answer on a flavor ban. Hahn continued to seek support for his nomination and met with Senate Majority Leader Mitch McConnell (R-KY) on his legislation to raise the nationwide tobacco purchasing age to 21 as well as the significance of hemp production in Kentucky. HELP Chairman Alexander (R-TN) hopes to have a committee vote on his nomination on Dec. 3rd with the goal of getting Hahn confirmed by the end of the year.
This week, the House Energy and Commerce Committee also approved two maternal health bills through the committee. Rep. Eliot Engel’s (D-NY) bill (H.R. 4995), the Maternal Health Quality Improvement Act of 2019, was favorably reported to the House. It seeks to create and improve existing federal health programs to address the ongoing maternal health crisis in the United States. Rep. Robin Kelly’s (D-IL) bill (H.R. 4996), Helping Medicaid Offer Maternity Services (MOMS) Act of 2019, was also favorably reported to the House. It seeks to reduce and end America’s growing maternal mortality crisis by incentivizing states to extend Medicaid coverage for new moms through the entire postpartum period by providing a 5% enhanced Federal Medicaid Assistance Percentages (FMAP) to incentivize an extension.
The Centers for Medicare & Medicaid Services (CMS) raised its estimate of Medicaid’s improper payments from $36 billion (9.8 percent of federal Medicaid expenditures) to $57 billion (14.9 percent of federal Medicaid expenditures). CMS is working to stop these improper payments and issued a new rule in September that they designed to catch providers before they engage in fraudulent activity Medicaid.
Healthcare Today is going to take a break for the holiday, so we wanted to wish everyone a Happy Thanksgiving!
November 15, 2019
Energy and Commerce Chairman Frank Pallone’s and Rep. Donna Shalala’s (D-FL) bill that seeks to end the youth tobacco epidemic was approved through the House Energy and Commerce Committee’s Health Subcommittee this week by voice vote. The bill would ban some flavored tobacco products including mint and menthol and raise the minimum age to buy tobacco products to 21. Republicans on the Subcommittee didn’t support the legislation believing the bill fails to solve the crisis and that it could lead to a black market for products. On the Senate side, the Senate Health, Education, Labor and Pensions (HELP) Committee held a hearing on the response to lung illnesses and the youth epidemic of e-cigarette use. During the hearing the Food and Drug Administration (FDA) Director of the FDA’s Center for Tobacco products Mitch Zeller said that he couldn’t provide a timeline for when the potential e-cigarette restrictions would be unveiled. President Trump announced this week that he will be meeting with representatives of the vaping industry and medical professionals as the White House considers new limits on e-cigarette sales. It is unclear when the meeting will take place, but many in the vaping industry believe this could be a step in the right direction in avoiding tough restrictions.
The Trump administration announced two rules to boost transparency in the healthcare marketplace. One of the rules would force hospitals and health insurers to disclose the reimbursement rates that are negotiated and force health plans to give members an upfront estimate of cost-sharing or the amount members would be responsible for. A second rule would force hospitals to publish information about the sticker prices that are set before negotiating with insurance companies. These regulations will likely face a challenge from the hospital industry in court.
This week the House Energy and Commerce Committee’s Health Subcommittee also approved a number of public health bills including legislation that would create and improve existing federal health programs to address the ongoing maternal health crisis in the United States, and legislation that seeks to stop drug companies from misusing the Food and Drug Administration’s (FDA) “citizen petition” tool, and a bill that would hope to reduce and end America’s growing maternal mortality crisis by incentivizing states to extend Medicaid coverage for new moms through the entire postpartum period by providing a 5% enhanced Federal Medicaid Assistance Percentages (FMAP) to incentivize an extension.
Google’s partnership with health care system Ascension has led to a federal investigation. Google and Ascension have worked on a project to collect detailed personal-health information from millions of patients over 21 states. The Health and Human Services Office for Civil Rights is seeking to learn more information about the mass collection of individuals’ medical records to ensure the Health insurance Portability and Accountability Act protections were fully implemented.
The Drug Enforcement Administration is suing the Colorado State Board of Pharmacy attempting to force Colorado to comply with a pair of administrative subpoenas to share patient information from its prescription drug monitoring program (PDMP) data. Colorado joins New Hampshire in using Fourth Amendment protections for PDMP data to resist federal government subpoenas after an important Supreme Court case, Carpenter vs. United States, placed guardrails on the government’s use of administrative subpoenas for some data contained in third-party databases. If the court sides with Colorado it would have a big impact as law enforcement would need to seek warrants before investigating PDMP data.
We hope you support the best local charity in your community on National Philanthropy Day.
November 8, 2019
We are hearing that the Senate Finance Committee Chairman Chuck Grassley (R-IA) and Ranking Member Ron Wyden (D-OR) will introduce a new version of their bipartisan drug pricing bill. The pair hopes to garner more Republican support for this new version of the bill. In other drug pricing news, the House vote on Speaker Nancy Pelosi’s drug plan (H.R. 3) will be delayed until the first week of December at the earliest. A full score of the bill from the Congressional Budget Office (CBO) isn’t expected to be released for at least another two weeks.
Dr. Stephen Hahn, a radiation oncologist and chief medical executive at M.D. Anderson Cancer Center in Houston was formally nominated by President Trump as the next Food and Drug Administration (FDA) Commissioner this week. Hahn is a Washington outsider that has never worked for the federal government but has experience as COO of M.D. Anderson and is a highly respected oncologist and researcher. Hahn’s confirmation hearing with the Senate Health, Education, Labor, and Pensions Committee will take place on November 20th and will center around a wide variety of issues including the vaping crisis, opioid crisis, and his position on drug pricing. Brett P. Giroir, Assistant Secretary for Health at the Department of Health and Human Services (HHS), has been named Acting Commissioner, with the current acting head Ned Sharpless going back to the National Cancer Institute.
This week, the Office of Management and Budget concluded its review of the Trump’s administrations vaping rule. This indicates that an announcement of the FDA guidance on the ban of flavored vaping products will be released soon. The final rule is expected to restrict or place a ban on all flavors besides tobacco and menthol, raise the age limit, and seek to end counterfeit products. Vape shops are rumored to be exempt from the final rule as they have pushed back against the administrations ban warning the administration of both the political and policy importance of the vape shop industry.
HHS filed a patent infringement lawsuit against Gilead in Federal District Court this week. HHS is seeking damages for Gilead’s alleged infringement of HHS patents related to prophylaxis (or PrEP) drugs for HIV prevention. HHS states that Gilead has refused to license its patents and has deliberatively induced infringement while making billions off these PrEP drugs without paying royalties.
A new report from the Centers for Disease Control (CDC) shows that people that live in rural counties are dying from preventable diseases at a higher rate than patients in urban counties. The CDC has recommended routine tracking of potentially excess deaths by urban-rural county classification to help public health departments and decision-makers identify and monitor public health problems and find ways to reduce potentially excess deaths in these areas.
A big thank you to all who have served our country in times of conflict and in peace on this Veterans Day weekend.
November 1, 2019
The Senate HELP committee passed a number of health bills this week. The committee passed a bipartisan bill from Sen. Johnny Isakson (R-GA) and Sen. Bob Casey (D-PA) that would bring the first changes to the federal oversight of over-the-counter drug market in forty years. The bill would authorize a five-year, multimillion-dollar user fee program at the Food and Drug Administration (FDA) allowing the agency to more effectively oversee the industry. Other bills reported out include a bill providing assistance to combat the escalating burden of Lyme disease and other tick and vector-borne diseases and disorders, a bill reauthorizing the Healthy Start program, a bill that revises and extends nursing workforce development programs, a bill to reauthorize the Lifespan Respite Care program, a bill seeking to improve the health of children and help better understand and enhance awareness about unexpected sudden death in early life, a bill promoting physical activity for all Americans, and a bill that would establish a Ready Reserve Corps within the United States Public Health Service (USPHS) Commissioned Corps .
This week Democratic Senators forced a vote on resolution via the Congressional Review Act (CRA) that would reverse a Trump administration guidance that allowed states to make changes to their insurance markets under the Affordable Care Act (ACA) through waivers. Senate Democrats believe that this guidance could allow Republican states to undermine protections for patients with pre-existing conditions granted by the ACA. The Senate rejected the resolution with Sen. Susan Collins (R-ME) being the sole Republican to vote for the resolution. In a related note, Georgia Governor Brian Kemp, mere hours after the CRA vote failed, unveiled one of these very waivers, making dramatic changes to Georgia’s individual health insurance market.
The Centers for Medicare and Medicaid Services (CMS) finalized changes to the Medicare rules for Durable Medical Equipment Prosthetics, Orthotics, and Supplies (DMEPOS), the End-Stage Renal Disease (ESRD) Prospective Payment System (PPS), and the ESRD Quality Incentive Program. CMS makes changes to encourage ESRD facilities to use the latest therapies and adds an add-on payment adjustment to promote the use of innovative renal dialysis equipment. CMS will also increase the pay for dialysis facilities that use new equipment raising the PPS base rate from $235.27 to $239.33 and modernize the pricing of DMEPOS items and services.
The Department of Health and Human Services (HHS) released a Request for Information (RFI) this week seeking input on chronic diseases. The RFI is concerned with the prevention and better treatment of chronic health conditions including but not limited to hypertension, high cholesterol, type 2 diabetes and prediabetes, obesity, and chronic kidney disease. HHS hopes to use information gathered from the RFI to inform the department how they can catalyze the scaling and deployment of effective prevention strategies into today’s social and economic environment to improve health care for non-communicable diseases.
The ACA market enrollment begins today. On average, prices for consumers shopping on Healthcare.gov will drop 4 percent for the most popular plans with six states reporting double-digit declines. Despite this growth the future of the ACA is murky as a federal appeals court will soon rule on whether to uphold a federal judge’s decision that the entire law was unconstitutional.
Rep. Rosa DeLauro’s (D-CT) bill (H.R. 3942) that would prevent online sales of e-cigarettes to children passed the House of Representatives by voice vote. The bill would require online age verification for the purchase of e-cigarettes and vapor products, require age verification at delivery of the above products and make e-cigarette products comply with all state and local tobacco tax requirements. The Centers for Disease Control reported that the most recent cases of lung disease linked to vaping rose just 8% over the most recent week of reporting compared to the most recent weeks which included a 50% increase. This could be a sign that vaping illnesses could be tapering off.
We are sad to see our friend Congressman Greg Walden (R-OR) announce his retirement from Congress. Greg has been a great legislator on many important healthcare issues.
October 25, 2019
House Speaker Nancy Pelosi’s drug package (H.R. 3) passed through the House Ways and Means Committee this week after a 12 hour mark-up. The bill passed on party lines with Ways and Means Health Subcommittee Chairman Lloyd Doggett voting present after his amendments to increase the minimum number of drugs eligible for price negotiation and include uninsured in the definition of “For Price Eligible Individuals” both failed. The Ways and Means version of the bill must now be reconciled with versions of the bill passed in the House Energy and Commerce Committee and House Education and Labor committee. The bill was initially anticipated to be brought up on the House floor next week, but it is now expected to be delayed until mid-November at the earliest after a full score of the bill is released from the Congressional Budget Office. Progressive Democrats, who played a role in the delay of the bill, will continue to push to broaden the scope of the bill allowing for an expansion of the medicines subject to negotiation with the federal government.
The House Ways and Means committee also approved legislation that would tax e-cigarettes the same as tobacco products. The bill would place an excise tax equivalent to the $1.01 federal levy per pack of cigarettes on tobacco alternatives. The bill passed on a partisan vote and the revenue raised from the tax will be used for three additional health care bills that the Ways and Means committee also passed that would make it easier for people to afford inhalers, over-the-counter medications, and menstrual care products. On the vaping front, we are hearing that the Trump administration is reconsidering the ban of mint and menthol vaping flavors. The vaping rules are still being drafted by the Food and Drug Administration (FDA) but they are expected to focus on keeping young children from vaping and ending counterfeit products. The nation’s top doctors and scientists are struggling with how to treat youth addicted to e-cigarettes as therapies have yet to be released to help teenagers to stop using e-cigarettes. In response to these concerns the FDA held a public hearing in January, a workshop in May on youth tobacco cessation, and has announced new funding opportunities for researchers to study effective ways to treat nicotine addiction in youth and explore the development of drug therapies for youth cessation.
The Centers for Medicare and Medicaid Services (CMS) released a request for information from technology companies and healthcare providers on its plan to incorporate advanced technologies such as artificial intelligence into efforts to combat medical fraud and improper payments. CMS hopes to use artificial intelligence to achieve greater savings for taxpayers and allow the agency to review more claims.
The Wall Street Journal reported that Dr. Stephen Hahn, a radiation oncologist and chief medical executive at M.D. Anderson Cancer Center in Houston, is expected to be nominated by President Trump as the next Food and Drug Administration Commissioner in the next week. Acting FDA Commissioner Ned Sharpless acting term expires on November 1st. Sharpless can continue in his position as Acting Commissioner while Hahn is going through the Senate confirmation process, but if the Trump administration fails to nominate someone for the position by November 1st a new Acting Commissioner will need to be put in place.
Let’s hope our Washington Nationals can continue their eight-game winning streak tonight and clinch a World Series victory over the Houston Astros this weekend!
October 18, 2019
House of Representatives Speaker Nancy Pelosi (D-CA) drug pricing bill (H.R. 3) was passed in both the House Education and Labor Committee and the House Energy and Commerce Committee along party lines. The Education and Labor Committee approved four amendments by House Democrats that would require the co-payment for a drug not to exceed the negotiated price of it with a health plan, require the GAO to study the negotiation program by the end of 2025, ensure that any coordination of data collection required by bill be coordinated with other data collection efforts, and require a study and regulation to give group insurance plans rebates for any increase of drug prices above inflation. The Energy and Commerce Committee approved one amendment by Rep. Kurt Schrader that would increase the Medicare Part B reimbursement for biosimilars for five years. Four additional bills were also favorably reported in the Energy and Commerce Committee that seek to strengthen Medicare Coverage by providing new vision, hearing and dental benefits to seniors through Medicare Part B as well increasing eligibility levels for the Medicare Savings Program. We anticipate these bills will be included in H.R. 3 when it comes to a floor vote. A mark up of H.R. 3 is expected to take place in the House Ways and Means Committee next week.
On the surprise medical billing front, Ways and Means Ranking Member Kevin Brady (R-TX) has come out in opposition of Ways and Means Chairman Richard Neal’s plan to stop surprise medical bills. Chairman Neal supports a negotiated rulemaking (Neg Reg) model for resolving surprise medical bills that the HHS has history of using for implementing some new Medicare payment systems. Neal wants HHS to work with the Departments of Labor and Treasury to identify standards for rates associated with surprise medical bills. Stakeholders would be convening to react to the rates under the Neg Reg process. Ranking Member Brady favors a federal benchmark approach with a way for doctors to appeal the payments.
CMS Administrator Seema Verma will testify for the House Energy and Commerce Committee’s Oversight and Investigations Subcommittee hearing on October 23rd. This will be her first hearing since the Democrats won back the House. The hearing will likely be confrontational with Energy and Commerce Democrats accusing Verma of “sabotaging” health care.
The Kaiser Family Foundation released a report on Medicaid enrollment and spending that predicts spending on Medicaid will be growing by more than 6% in 2019. The report states that increasing costs for prescription drugs, rate increases in managed care organizations, hospitals and nursing facilities, and an aging population are all factors in the predicted increase in Medicaid spending.
We are sad to see the passing of House Oversight and Reform Committee Chairman Elijah Cummings. Chairman Cummings was a longtime champion for lowering drug prices and served his Baltimore district well for twelve terms.
October 11, 2019
The House of Representatives is poised to take quick action on Speaker Pelosi’s (D-CA) drug pricing bill (H.R. 3). The House Ways and Means and Energy and Commerce Committees are preparing to hold mark ups of the bill the week after next, with consideration on the House floor likely the last week of October. House Democratic Leadership is considering ideas for using the savings generated from the bill to improve the Medicare program. One of the ideas floated this week was including new coverage for hearing aids, eye glasses, and a new dental benefit. Republicans in the House are working to coalesce behind an alternative proposal but have been happy to just be critical of the Speaker’s bill, trying to put it in line with the Medicare for All proposal. Meanwhile, Senator Grassley (R-IA) continues to press Republicans and Democrats alike to build support for the bill reported out of the Senate Finance Committee.
The Trump administration released proposed rules to revise and create new safe harbors under the federal anti-kickback statute and the physician self-referral statute also known as the Stark law, named after its author former Congressman Pete Stark (D-CA). These rules are part of the initiative known as the Regulatory Sprint to Coordinated Care, where agencies are reviewing regulations to reduce the regulatory burden and encourage more coordination of care. The physician self-referral regulation was issued by the Centers for Medicare and Medicaid Services (CMS) while the anti-kickback regulation was issued by the Department of Health and Human Services Office of Inspector General (OIG). Under the physician self-referral proposed rule, providers would be eligible for three new safe harbors to promote value-based care arrangements. The anti-kickback proposed rule also creates three new safe harbors and revises other safe harbors.
The Centers for Disease Control (CDC) issued new warnings about e-cigarette use and vaping. The CDC has found lung injury cases from e-cigarette use or vaping have been found in 49 states, the District of Columbia, and one territory. There have been 26 deaths from lung injury in 21 states confirmed. Most of the patients are young males under the age of 35. No single product has been associated with these illnesses and deaths. CDC is advising at this time that individuals refrain from using e-cigarettes or vaping, particularly with those containing tetrahydrocannabinol (THC). However, if you are using e-cigarettes to quit smoking CDC advises those individuals to not return to smoking. Pregnant women and children are specifically discouraged from using e-cigarettes or vaping.
Four former Surgeons General penned an op-ed in the Orlando Sentinel warning that dementia is the largest public health risk. The number of patients with dementia over the age of 65 doubles every five years. This crisis is hitting communities of color the hardest. By 2030, forty percent of those individuals suffering from dementia will be Latino or African American. Around 35 percent of dementia cases are attributable to these nine risk factors: low education; midlife hypertension; hearing loss; mid-life obesity; late-life depression; diabetes; physical inactivity; smoking; and social isolation. The National Institutes of Health issued a study in 2016 suggesting a well-balanced diet can help with cognitive decline. These health care leaders are urging the country to take brain health as seriously as we are taking heart health, cancer, and smoking cessation.
For those of us sleep deprived Nationals fans, we have plenty of exciting baseball coming up this week. Go Nats!
October 4, 2019
President Trump issued an Executive Order on Thursday to promote Medicare Advantage plans. The Executive Order was signed at a Florida retirement community at an event that had the feeling of a campaign event with the president lashing out at the Medicare for all proposal and the politicians supporting the proposal who are running for President. Secretary of Health and Human Services (HHS) Alex Azar is directed to draft regulations to expand Medicare Advantage plan providers to offer more flexible plans and increase the use of telehealth services. The Executive Order also expands the use of health savings accounts (HSAs) by directing the Social Security Administrator to allow seniors who sign up for Social Security benefits to not have to enroll in Medicare Part A. The requirement to enroll in Medicare Part A as you enroll in your Social Security benefits has prohibited seniors from continuing to contribute to their HSAs.
Adam Boehler had his last day at the Centers for Medicare and Medicaid Innovation (CMMI) this week. Adam gathered all of the staff of CMMI for an all-hands meeting before he departs for the International Development Finance Corporation. CMMI rolled out sixteen new payment models under Adam’s leadership. Amy Bassano will step in as the Acting Director while the search for a permanent replacement for Adam is conducted. The leading candidate appears to be Brad Smith who founded a palliative care company, Aspire Health, with former Senate Majority Leader Bill Frist (R-TN).
Speaking of new payment models from CMMI, this week Centers for Medicare and Medicaid Services (CMS) Administrator Seema Verma touted the savings achieved by accountable care organizations (ACOs). Administrator Verma claimed ACOs saved $750 million last year and 11 million seniors are now receiving care from ACOs in an op-ed she penned for the Health Affairs Blog. Aledade and Privia Health also touted the success of the ACOs their companies run.
The surprise medical billing journey took another twist with Ways and Means Committee Chairman Richie Neal (D-MA) announcing his committee is pursuing a negotiated rulemaking (Neg Reg) model for resolving surprise medical bills. Neg Reg is used extensively to implement regulations for the Higher Education Act. However, HHS has also used Neg Reg for implementing some new Medicare payment systems. Under the draft legislation from Ways and Means, HHS will work with the Departments of Labor and Treasury to identify standards for rates associated with surprise medical bills. Stakeholders would be convening to react to the rates under the Neg Reg process.
Let’s hope our Washington Nationals fare better as the series with the Dodgers rolls on with a Sunday night game at Nationals Park.
September 27, 2019
The efforts for Congress to tackle prescription drug prices continues to dominate the healthcare agenda. Republicans in the House are expressing frustration that the committees are focused on Speaker Pelosi’s (D-CA) bill, H.R. 3, to empower the department of Health and Human Services (HHS) to negotiate certain drug prices rather than crafting a drug pricing bill with committee Republicans. Energy and Commerce Committee’s Ranking Member Greg Walden (R-OR) said he was “frustrated” about being left out of negotiations. Meanwhile Energy and Commerce Committee Chairman Frank Pallone (D-NJ) said he would welcome Republican participation in the negotiation bill. If the two sides are going to come together, they need to act fast as Wendell Primus who serves as Speaker Pelosi’s healthcare policy advisor predicted H.R. 3 will be on the House floor by the end of October. On the other side of the Capitol, Senate Finance Committee Chairman Chuck Grassley (R-IA) expressed some doubts about moving a drug bill this year saying the bill could wait until next year.
The Senate approved the continuing resolution (CR) by a vote of 82 to 15. The bill now goes to the President for his signature and assuming he signs it we will avoid another government shutdown. The CR extends a number of healthcare programs until the CR’s expiration of November 21st. The Medicaid Disproportionate Share Hospital (DSH) is extended as is funding for Community Health Centers, the National Health Service Corps, and the Graduate Medical Education (GME) program for teaching hospitals.
The National Institutes of Health (NIH) released nearly $1 billion in opioid research grants to 375 studies in 41 states. This amount is double the amount awarded last year for this purpose. This is part of the agency’s Helping to End Addiction Long-Term initiative. This initiative seeks to curb the tragic rate of 130 overdose deaths each day as part of this epidemic with opioids in our country. Even with this boost in funding, NIH is only able to award funding to 1 out of 5 applications.
The Food and Drug Administration (FDA) offered some clarity around their plans to tackle flavored e-cigarettes. The agency is not going to outright ban flavored e-cigarettes. Rather FDA plans to establish a process where manufacturers will be able to demonstrate to the agency that their product leads to healthy outcomes from smoking cessation. This was learned from testimony delivered by FDA Acting Administrator Ned Sharpless before the House Energy and Commerce Committee. Meanwhile, the House Oversight Committee is launching an investigation into the nicotine levels contained in e-cigarettes. The nicotine levels in JUUL’s products are double those of older e-cigarettes.
We hope you enjoy your liverwurst sandwich today on this National German Sandwich Day.
September 20, 2019
Speaker Pelosi’s (D-CA) drug pricing bill, H.R. 3, was introduced this week by Energy and Commerce Committee Chairman Frank Pallone (D-NJ), with Ways and Means Committee Chairman Richie Neal (D-MA) and Education and Labor Committee Chairman Bobby Scott (D-VA) on the bill as original cosponsors. The bill would authorize the Secretary of Health and Human Services (HHS) to negotiate the price of at least 25, and as many as 250, drugs that have little or no competition. The bill also caps the expenses of seniors in the Medicare Part D program at $2,000. H.R. 3 also imposes an excise tax on manufacturers gross sales. Senate Majority Leader Mitch McConnell (R-KY) was very critical of the plan, making it highly unlikely it would be brought up in the Senate after it passes the House.
Meanwhile, Senator Chuck Grassley (R-IA) was working Republican Members of the House and Senate to build support for the drug pricing bill the Senate Finance Committee reported out in July. We are told there have been small meetings with select Senators and Members of the House of Representatives to try and build support. Senator Grassley is pointing to Speaker Pelosi’s bill as motivation to get behind the bill he and Senator Wyden (D-OR) drafted but have not yet introduced. We are expecting H.R. 3 to pass the House largely in its current form even after the committees of jurisdiction mark the measure up. All eyes will likely fall on the Grassley-Wyden bill after the House acts.
President Trump issued an Executive Order this week directing HHS to encourage the production of more and better flu vaccines by moving away from the older egg-based production and to convince more Americans to get vaccinated against the flu. The president’s Council of Economic Advisers also issued a report this week laying out the economic arguments behind the Executive Order. The report finds that the flu costs the economy $50 billion each year in direct costs and lost productivity. It also warns of the risk of a pandemic outbreak that could cost the economy between $1.8 and $3.8 trillion in lost revenues.
In an interesting twist in the surprise medical billing drama on Capitol Hill, the House Energy and Commerce Committee sent letters to the leaders of three private equity firms after it was learned that two companies owned by private equity firms were behind the massive ad campaign run by Doctor Patient Unity conducted against the Energy and Commerce Committee’s bill and the Senate Health, Education, Labor, and Pension Committee’s bill. We know the Ways and Means Committee and the Education and Labor Committee are in interested in reporting bills in this space as well, but have not yet been able to hold those markups.
We hope you all have a restful weekend as we brace for the havoc that is coming to Washington’s streets from the Extinction Rebellion protest on Monday morning.
September 13, 2019
President Trump was joined in the Oval Office by First Lady Melania Trump along with Health and Human Services (HHS) Secretary Azar and Food and Drug Administration (FDA) Acting-Commissioner Ned Sharpless where the president declared vaping has become an urgent public health concern particularly with respect to children. He also said his administration would need to do something “very, very strong” about it. Secretary Azar announced at the meeting that FDA will be releasing guidance in the coming weeks to ban the sale of almost all flavored vaping products. The announcement was met with strong support from Members of Congress who have been working on this issue. Senators Richard Durbin (D-IL) and Mitt Romney (R-UT) along with Congresswoman Diana DeGette (D-CO) issued favorable statements, but all three Members believe Congress must act as well.
A summary of Speaker Pelosi’s (D-CA) bill to curb drug prices was leaked this week. As we expected, the bill (H.R. 3) will have HHS negotiate the price of 250 therapies that are most expensive and have no competition. The bill will also cap the price of the drugs at 1.2 times the average price of those same drugs in Australia, Canada, France, Germany, Japan, and the U.K. The plan was embraced by many Members from her party who long have pushed for Medicare to negotiate the price of drugs in the Medicare Part D program. Congressman Peter Welch (D-VT) stated the proposal will have a great benefit to the economy by lowering drug prices across the board. However, there remains many questions about how this process will unfold, and it is still unclear what the road ahead looks like – with members expecting to be included and consulted going forward.
The Census Bureau released its annual report on Tuesday showing that the number of uninsured rose for the first time since passage of the Affordable Care Act. In 2018 8.5 percent of Americans, about 27.5 million people, lacked health insurance as compared to 2017 when only 7.9 percent of Americans lacked insurance. The annual report also showed that median household income rose by 0.9 percent. The rise in income likely made a number of people no longer eligible for Medicaid as evidenced by the survey showing Medicaid enrollment down 0.7 percent.
Conventional wisdom suggests the effort to address surprise medical bills is slowing in Congress. The mysterious group Doctor Patient Unity has spent $27.5 million on advertising critical of bills produced by the Senate Committee on Health, Education, Labor, and Pensions (HELP) and the House Committee on Energy and Commerce. In related news, the Secretary of Transportation announced the membership of her Air Ambulance and Patient Billing Advisory Committee, a group that the FAA reauthorization bill required her to stand up to review ways to protect consumers from expensive air ambulance bills. Gregory Cote who serves as the Associate General Counsel at the Department of Transportation will serve as the Chairman of the committee.
It is Friday the 13th and we are expecting a harvest moon tonight. The last time we had a harvest moon on Friday the 13th was in 2000 and the next this event will occur is 2049.
September 6, 2019
Speaker Pelosi (D-CA) is preparing to release her legislation to address the high cost of prescription drugs. The bill will be a targeted Medicare negotiation bill that will focus on therapies that have been on the market without competition. Former Obama Administration Health and Human Services (HHS) official Richard Frank, now a professor at Harvard Medical School, and Len Nichols a former Clinton Administration official at the Office of Management and Budget (OMB) co-authored an op-ed in the New England Journal of Medicine supporting the policy behind the Speaker’s bill. Progressives are still pushing the Speaker to back a stronger bill that would have HHS directly negotiate the prices of drugs in the Medicare Part D program. The bill is expected to be designated as H.R. 3 which is significant as the Speaker reserves the bill numbers H.R. 1-10 for the highest priority pieces of legislation.
We are expecting the president to name Dr. Stephen Hahn as the next Commissioner of the Food and Drug Administration (FDA) following a meeting the two had at the White House that reportedly went well. Dr. Hahn is currently the chief medical executive at MD Anderson in Houston. A prominent radiation oncologist Dr. Hahn was the only candidate for the position to meet with President Trump. Meanwhile Brad Smith is the leading candidate to head the Centers for Medicare and Medicaid Innovation (CMMI). Smith co-founded the palliative care company Aspire Health with former Senate Majority Leader Bill Frist (R-TN). Adam Boehler remains in the position pending his confirmation to lead the International Development Finance Corporation.
Surprise medical bills continue to be in focus in Washington. Thirty-two state insurance commissioners wrote to the Senate Health, Education, Labor, and Pensions (HELP) Committee Chairman Lamar Alexander (R-TN) and Ranking Member Patty Murray (D-WA) encouraging them to maintain the section, Section 105, of their bill (S. 1895) that addresses surprise medical bills from air ambulance providers. Ways and Means Committee Democratic Members are schedule to meet on this issue next week to try and find consensus on a policy path forward in their committee’s jurisdiction. Rumor has it the committee is poised to take a different tack than the Energy and Commerce Committee and the Senate HELP Committee and is considering an arbitration model favored by physician and other healthcare providers.
Michigan Governor Gretchen Whitmer (D) took executive action to have Michigan be the first state to ban flavored e-cigarettes. Governor Whitmer directed her Department of Health and Human Services to draft a regulation to ban on-line and retail sales of the products for six months. The ban can be renewed for an additional six months. The state legislature is not expected to try and overturn the regulation as it would face a veto from the governor. The state agency had found youth vaping to be a public health emergency which served as the motivation for the governor’s order.
This week HHS announced more than $1.8 billion in funding to states to continue the administration’s efforts to combat the opioid crisis by expanding access to treatment and supporting near real-time data on the drug overdose crisis. Efforts to expand treatment are succeeding: Data suggests approximately 1.27 million Americans are now receiving medication-assisted treatment, out of approximately 2 million Americans with opioid use disorder. Since the beginning of the new administration, the number of naltrexone prescriptions per month has increased 55 percent.
HHS’ Office of the National Coordinator for Health Information Technology (ONC) awarded a contract to a non-profit, the Sequoia Project, to develop a common set of standards for healthcare organizations that share electronic health information. The Sequoia Project will rewrite what is known as the Common Agreement which dictates the standards for healthcare providers to exchange data. The Common Agreement is required for providers to access a health information exchange (HIE). The hope is by updating and modernizing the Common Agreement HIE use will expand greatly as HIEs are currently used by a narrow scope of providers.
We hope your office hosted a lunch party for you on this National Cheese Pizza Day.
August 23, 2019
The Department of Health and Human Services (HHS) issued a proposed rule on Thursday to update the federal regulations governing the privacy of patient records around treatment for substance abuse disorders known as 42 CFR Part 2. The current rule does not allow healthcare providers to see the records of substance abuse treatment for patients when they are there for other disorders. This allowed physicians to prescribe opioids to a patient not knowing that the patient had previously struggled with opioid use disorder. The fairly modest changes would allow – with patient consent – the inclusion of a patient’s substance abuse treatment into their electronic health record (EHR). HHS Secretary Azar acknowledged their proposed changes do not get around the consent requirement of 42 CFR Part 2. In the last Congress, legislation (H.R. 3545) advanced but did not get signed into law to reform 42 CFR Part 2 to allow substance abuse treatment records to be shared without patient consent.
It is surprising to see the recent release of a confidential memo from 2006 warning of the coming opioid epidemic. National Institute on Drug Abuse (NIDA) Director Nora Volkow and then-Director of the National Institutes of Health (NIH) Elias Zerhouni warned then-Surgeon General Richard Carmona of a disturbing trend in opioid addiction and urged a public health warning be issued. According to Carmona, a number of meetings were held on the topic with officials working for HHS Secretary Leavitt and the White House, but the matter arose at the end of Dr. Carmona’s term and nothing came of it. Of course, there were other issues the agencies were dealing with at the time including the meth epidemic that was hitting rural states and preparations for a possible bioterrorism attack. But one must wonder about the trajectory of the opioid crisis had a warning been issued in 2006.
The ambitious project to link the Department of Veterans Affairs (VA) health records with the Department of Defense (DoD) may be hitting some snags according to reports this week. The VA issued a $16 billion contract to the EHR company Cerner to integrate the records. The VA had planned to roll this project out at three VA facilities in Washington state in March of 2020. However, it appears the rollout will be delayed. The ranking Republican Member on the House Veterans Affairs Committee Congressman Phil Roe (R-TN) acknowledged the VA is considering delaying the “go-live” date at some of these facilities. Congresswoman Susie Lee (D-NV) who chairs the House Veterans Affairs Committee’s Subcommittee on Technology Modernization has stated she would prefer to see a delay if it means the implementation is done right.
Planned Parenthood decided this week to withdraw from the federal Title X family planning and preventive health services program for low income individuals rather than comply with a new Trump administration regulation that prohibits abortion referrals by Title X providers. The final regulations were issued this winter and are being challenged in court. However, the 9th Circuit Court of Appeals ruled in July that the regulations should stand while be challenged in the courts rather than issue a stay on the regulation.
Healthcare Today is going to take a much-needed summer vacation next week. Publication of Healthcare Today will resume on Friday, September 6th. We hope you enjoy your Labor Day weekend and the return of kids to school if they are not already back.
August 16, 2019
The Trump Administration released a final rule this week to redefine “public charge” in our immigration law to allow the federal government to deny green cards to individuals who would qualify for Medicaid and other federal benefits. Previously, public charge was defined as someone who primarily relied upon the federal government for subsistence. The Kaiser Family Foundation has warned that the rule could lead to millions of legal immigrants disenrolling in Medicaid. Thirteen states, the city of San Francisco, and Santa Clara County have all filed lawsuits to halt the rule from taking effect.
Speaking of Medicaid, former White House healthcare policy advisor Brian Blase co-authored an op-ed in the Wall Street Journal with Aaron Yelowitz, a University of Kentucky economist, claiming that there is a large number of individuals enrolled in Medicaid with incomes far above the thresholds for qualifying for the program. The authors relied upon a study from the National Bureau of Economic Research released this week. There are some limitations to the study’s data, which the authors acknowledge, in terms of how the individual qualified for Medicaid. In some states, Medicaid benefits can be bestowed based upon a medical condition and not income.
Attention to surprise medical bills continues with the release this week of a study published in the Journal of American Medical Association (JAMA). JAMA is one of the most respected medical publications in the country. The study found that the rate of surprise medical bills for emergency room visits rose between 2010 and 2016 by ten percent and the mean amount of surprise bills increased from $220 to $628. We are expecting Congress to return its attention to this issue in the fall.
The American Medical Association (AMA) is dropping out of an alliance, the Partnership for America’s Health Care Future, formed to try and stop Medicare for All. The alliance still counts large members from the American Hospital Association (AHA), America’s Health Insurance Plans (AHIP), and the Pharmaceutical Research and Manufacturers of America (PhRMA). Younger physician members of AMA did not appreciate the alliance working against proposals to expand coverage like promoting a public option in the Affordable Care Act’s (ACA) exchanges, as has been proposed by former Vice President Joe Biden, and urged the association to pull out.
Yesterday, the Food and Drug Administration (FDA) released a proposed rule, Required Warnings for Cigarette Packages and Advertisements, which lays out thirteen proposed warnings that would be included on all cigarette packs and advertisements. After a back and forth in the courts, the FDA was required to issue the rule which includes graphic images “depicting some of the lesser-known health risks of cigarette smoking,” per the FDA. The rule, the first major update to cigarette packaging in a generation, would require the images to cover half of the front and back of a cigarette package and the top twenty percent of the top of any advertisements.
If you are in Washington next week and do not have plans, consider checking out the Office of National Coordinator for Health Information Technology’s (ONC) interoperability forum being held on Wednesday at the Renaissance Hotel. There are five tracks for their afternoon sessions.
August 9, 2019
The issue of surprise medical bills continues to be a big focus in Washington and around the country. Physicians for Fair Coverage is planning a communications and grassroots blitz in the home states and districts of members of Congress. The organization backs an arbitration model that conflicts with the model of the bill reported from the Senate Committee on Health, Education, Labor, and Pensions (HELP). Meanwhile, members of Congress received a letter in support of the HELP Committee signed by over fifty trade associations, of which the majority are business-related. The House Ways and Means Committee leadership has also weighed in, stating they are planning to write their own bipartisan bill, to be drafted by Chairman Richie Neal (D-MA) and Ranking Member Kevin Brady (R-TX). The two members also wrote to the Secretary of Transportation Elaine Chao urging her to quickly convene the Air Ambulance and Patient Billing (AAPB) Advisory Committee as Congress instructed her to do as part of the Federal Aviation Administration (FAA) reauthorization bill signed into law last year.
The Centers for Medicare and Medicaid Services (CMS) finalized a regulation this week that will allow for coverage of the Chimeric Antigen Receptor T-cell (CAR-T) therapy for the treatment of cancers. CAR-T therapy reinfuses patients with boosted versions of their own immune cells. Coverage of this therapy was previously not covered by Medicare. Under this new policy, coverage will be provided for administration of this treatment in facilities that follow the Food and Drug Administration’s (FDA’s) safety guidelines. This announcement was cheered by the cancer patient advocacy organizations. This treatment is very expensive – CMS has not announced their reimbursement rates at this time.
President Trump plans to make a major healthcare speech in September outlining his plan for overhauling the nation’s healthcare system. The President plans to talk about protections for pre-existing conditions, lower drug prices, and ending surprise medical bills. The President is hoping to contrast his plan with the Democratic presidential candidates plan for Medicare for All. It is not clear at this point whether the White House will send to Capitol Hill legislative language to implement the plan he outlines in his speech.
The University of Washington is conducting a controversial new study to determine the health effects of pregnant women who consume cannabis. Cannabis is known to help with nausea which many pregnant women experience during their early months of their pregnancy. The study will examine the effects of tetrahydrocannabinol (THC) on the infants’ brains. The FDA has approved of the use of a synthetic THC for treating AIDS-related appetite loss but has not approved it for treating morning sickness. The study is being funded by the National Institute on Drug Abuse.
Tomorrow is National Lazy Day so we hope you enjoy some time on your front porch, in a hammock or maybe on a floatee on the water.
August 2, 2019
The Trump Administration announced another initiative aimed at lowering prescription drug prices. On Wednesday, the White House announced that the Department of Health and Human Services (HHS) and the Food and Drug Administration (FDA) were releasing the Safe Importation Action Plan to allow two pathways forward to import drugs from Canada. Under the first pathway, states, wholesalers, or pharmacists could submit plans to HHS for demonstration projects to allow for the importation of Canadian approved drugs so long as they were compliant with the Federal Food, Drug, and Cosmetic Act. The second pathway would be to allow manufacturers of FDA approved drugs to import the version of those drugs they are selling in other countries. This announcement was met with stiff resistance from the trade association (PhRMA) representing the name brand drug manufacturers. PhRMA’s CEO Steve Ubl issued a statement stating we should not be importing failed policies of single-payer countries but rather focusing on how to lower prices paid at the prescription counter in our country.
The administration also released three big Medicare payment rules this week. The Physician Fee Schedule, the Hospital Outpatient Prospective Payment System (OPPS), the End-Stage Renal Disease (ESRD) Prospective Payment System and the Durable Medical Equipment Prosthetics, Orthotics and Supplies (DMEPOS) rules were all released on Monday night. Each rule contains a significant amount of new policies as each rule is nearly 2000 pages in length. One of the new policies gaining a lot of attention is the requirement for hospitals to publish the negotiated rates they charge. Hospitals that do not comply will face stiff monetary penalties under the proposed rule.
The two big pharmaceutical companies Pfizer and Mylan are looking to join forces. Under the proposed transaction, Pfizer would move long-standing treatments that no longer have patent protections like Lipitor and Viagra to Mylan while Pfizer focuses on developing new therapies. Michael Goettler who is Pfizer’s top executive in its off-patent division would become CEO of the new company while Mylan’s CEO, Heather Bresch, and CFO, Ken Parks, would both depart after the deal is consummated.
The Federal Communications Commission (FCC) has advanced a rural health care plan over objections of some Senators and FCC Board members. The FCC runs a program to provide subsidies to rural health care providers to help defray the cost of broadband. The program has come under criticism for its inefficiency with the rise of applications in recent years. FCC Commissioner Ajit Pai put together revisions to the program to make it more efficient and transparent. However, a bipartisan group of 13 Senators wrote a letter to Commissioner Pai urging him to delay action on his proposal as they are concerned his proposal does not give sufficient guidance nor addresses what they believe to be problems with the program. There were also objections from Democratic Commissioners on the FCC.
On this International Beer Day we hope you enjoy responsibly as we toast the beginning of the August recess for Congress.
July 26, 2019
The Senate Finance Committee approved sweeping legislation aimed at lowering prescription drug costs. The measure would penalize drug manufacturers if their products’ prices rise faster than the rate of inflation. The bill also reshapes the Medicare Part D program requiring pharmaceutical companies to contribute to the cost of catastrophic coverage. There is also a requirement for the Department of Health and Human Services (HHS) to disclose information provided by pharmacy benefit managers (PBMs) for drug coverage provided in the Medicaid program. The Congressional Budget Office (CBO) is estimating that these policies will lower the budget deficit by $100 billion over the next ten years. The committee voted to report the bill by a vote of 19 to 9 with all of the dissenting vote coming from Republican Senators. Even some Republican Senators who voted to report the bill are hoping to make changes to the bill before it reaches the Senate floor. Senator Grassley (R-IA) who chairs the committee warned his Republican colleagues to support what he terms a modest proposal or face the prospect of President Trump reaching agreement with Speaker Nancy Pelosi (D-CA) on a set of drug policies that Republican Senators would find to be worse policies such as allowing HHS to negotiate the prices of drugs in the Part D program. It is interesting to note that HHS Secretary Azar and the Director of the White House Domestic Policy Council Joe Grogan helped shape the Senate Finance Committee’s proposal.
With the House passing on an overwhelming basis legislation to repeal the so-called “Cadillac tax” on the most generous health insurance plans, there is a lot of speculation about the possibility of repealing other taxes put in place by the Affordable Care Act (ACA) along with it. Medical device manufacturers are pushing for the repeal of the device tax which also enjoys bipartisan support. The implementation of the device tax has been delayed for two years twice by Congress. Health insurance companies are also seeking to repeal the tax on health policy premiums. The Cadillac tax and health insurance taxes are expected to bring in $193 and $145 billion in revenue over the next decade while the device tax is only expected to return $20 billion to the federal Treasury.
The Food and Drug Administration (FDA) sent a letter to the marijuana company Curaleaf Holdings Inc. warning about the claims the company is making about its products containing Cannabidiol (CBD). FDA claims that the products need to be considered as drugs and thus requiring the FDA’s approval because the company claims the products can treat pain, ADHD, and anxiety. This week FDA Principal Deputy Commissioner Dr. Amy Abernethy testified before Congress about CBD. Dr. Abernethy warned Congress that there is some risk associated with CBD including liver damage and exhaustion symptoms. However, she did state that FDA does see a path forward for products with CBD. Industry supporters are anxious to know that path specifically is and how quickly FDA will make that clear.
HHS Secretary Azar outlined the Trump administration’s health care agenda this week. Secretary Azar stated that the three priorities are: 1. changing healthcare financing; 2. improving value; and 3. boosting public health. The Secretary pointed to initiatives already rolled out by the administration such as their kidney care and HIV Executive Orders and drug pricing initiatives as evidence of President Trump moving forward with this agenda. Azar demurred about the pending ACA lawsuit when asked.
July 19, 2019
This week the Food and Drug Administration (FDA) closed the comment period following the hearing the agency held on May 31st on cannabis and cannabis-derived products including cannabidiol (CBD). There were 100 presenters at the hearing and FDA received well over 3,000 comment letters on the issues. Many were encouraged by a series of Tweets from Deputy Commissioner Dr. Amy Abernathy who is leading the internal Cannabis Working Group. Dr. Abernathy said she is enthusiastic about the therapeutic benefits of CBD products, but they also need to balance safety. She also said FDA will report on its progress at the end of summer or early fall. That is welcome news as many advocates like the National Association of Chain Drug Stores and the National Community Pharmacists Association are urging the agency to quickly come up with safety and labeling standards.
The House on a near unanimous vote of 419-6 approved a bill, H.R. 748, to repeal the so-called “Cadillac tax” put in place by the Affordable Care Act to levy a 40% excise tax on the most generous health plans offered by employers. The tax was scheduled to take effect in 2018 but Congress has repeatedly pushed out the effective date. The intention behind the tax was to help bend the cost curve of private health insurance. However, many lawmakers have had a change of heart about the policy as evidenced by the overwhelming vote. Senate leadership has not expressed their intentions with respect to the legislation, but we believe this is certainly in the mix with other priority tax issues pending before Congress.
Efforts to stop surprise medical bills took a step forward this week with the Energy and Commerce Committee passing on voice vote their No Surprises Act (H.R. 3630). The committee did have to make a compromise and accepted an amendment authored by Congressmen Ruiz (D-CA) and Bucshon (R-IN), both of whom are physicians, to add an arbitration process where healthcare providers can appeal the benchmark payment rate in certain circumstances. The Congressional Budget Office (CBO) also released its cost estimate of the bill, S.1895 – Lower Health Care Costs Act, approved by the Senate Committee on Health, Education, Labor, and Pensions (HELP). CBO estimates S. 1895 will lower the budget deficit by $7.578 billion over the next ten years. The score estimates that insurance premiums will be lower under this legislation and also anticipates taxpayers taking fewer deductions for large healthcare expenses. Currently, taxpayers are allowed to deduct healthcare expenses that exceed 7.5% of their adjusted gross income.
Senator Alexander (R-TN) who chairs the HELP Committee has indicated that he believes his surprise medical bills legislation is now ready for the Senate floor and no longer appears to be waiting on the Senate Finance Committee to report a package of bills on drug pricing to be included with his measure. Senate Finance members met with CBO on Wednesday to better understand how changes in the Medicare Part B and Part D programs would impact federal government spending and spending by seniors. CBO has not yet provided full cost estimates for proposals being considered by the committee, so it is hard to get an agreement on the policy. Senator Grassley (R-IA) who is Chairman of the Finance Committee still hopes to be able to mark a bill up next week.
We hope you will consume responsibly on this National Daiquiri Day (what a way to start the weekend!).
July 12, 2019
There is a lot happening in the ongoing efforts by President Trump and Congress to tackle prescription drug prices. The United States District Court for the District of Columbia threw out the administration’s regulation requiring drug manufacturers to include the therapy’s list price in broadcast advertisements. Three of the largest pharmaceutical companies (Merck, Amgen, and Eli Lilly) joined with the Association of National Advertisers to challenge the rule in court. The administration also abandoned their proposed rule to eliminate the safe harbor from Anti-Kickback statutes for discounts offered by drug manufacturers to pharmacy benefit managers (PBMs) and replace it with a safe harbor for offering discounts directly to consumers. There was a lot of palace intrigue around where players in the administration stood on the proposal. It appears as though the administration is shifting the focus to Congress in its efforts to lower drug prices as Health and Human Services (HHS) Secretary Azar and the Director of the White House Domestic Policy Council Joe Grogan met with Republicans on the Senate Finance Committee this week to discuss proposals under the committee’s consideration. We are expecting Senate Finance to markup a package of drug pricing bills as early as next week. Meanwhile the House Energy and Commerce Committee’s Health Subcommittee reported a bill – H.R. 2296, the FAIR Drug Pricing Act – to require prescription drug companies to justify their price hikes to HHS.
June 28, 2019
President Trump issued an Executive Order (EO) on Monday to address the issue of the lack of transparency in health care prices. The EO directs the Secretary of Health and Human Services (HHS) to develop a proposed regulation within 60 days to require hospitals to post standard charge information. It further directs HHS working with the Departments of Treasury (Treasury) and Labor (Labor) to develop a regulation that will compel health insurers and self-insured group health plans to notify consumers of their expected out-of-pocket expenses with healthcare services. It also directs HHS to prepare a report on steps the administration can take to tackle the issue of surprise medical bills. The EO was met with some stiff criticism from the healthcare industry interests. The trade association of insurance companies America’s Health Insurance Plans (AHIP) warned that publishing negotiated rates will lead to higher not lower prices for consumers claiming that the disclosed rates will become a price floor not a ceiling.Speaking of healthcare prices, the Senate Committee on Health, Education, Labor, and Pensions (HELP) reported a sweeping bill to attempt to tackle healthcare costs, transparency and other issues. The main focus of the bill is on surprise medical bills. The HELP bill establishes a benchmark payment amount to protect consumers and prohibits providers from billing for the balance of their charges. As part of a manager’s amendment, the bill also includes the so-called CREATES Act to promote generic drugs. Under the CREATES Act, generic drug companies can request through the Food and Drug Administration (FDA) samples of name brand drugs and sue those companies for samples as well. It also allows generic drug manufacturers to use different comparable safety protocols for the drug rather than using single shared protocol with the named drug. The managers amendment also included Senate Majority Leader McConnell’s (R-KY) bill to raise the minimum age to buy tobacco products to 21 years old.
The HELP bill also prohibits pharmacy benefit managers (PBMs) from charging more to health plans or enrollees for prescription drugs than the price they paid the pharmacy for it. The bill also directs HHS in consultation with Labor to develop a claims data base to improve transparency of healthcare costs. The bill also reauthorizes and provides funding for Community Health Centers, the National Health Service Corps, the Graduate Medical Education program, and the Special Diabetes program.
The House Problem Solvers Caucus, the group of 46 Members evenly split between Democrats and Republicans, released a plan this week to tackle prescription drug prices. Similar to much of the bipartisan legislation that has already passed out of committees of jurisdiction, the Problem Solvers plan would establish price transparency standards for prescription drugs to give the federal government, healthcare providers and consumers more information about drug prices.
The lawsuit against the Affordable Care Act (Texas v. United States) took some interesting twists and turns this week. The U.S. Court of Appeals in New Orleans where the case is pending is asking the defendants of the law, a group of Democratic attorneys general and the Democratic controlled House of Representatives, to submit a 15-page brief to the court explaining why they have standing in this case. The House Oversight and Reform Chairman Elijah Cummings (D-MD) is seeking to have Acting Director of the Office of Management and Budget Russ Vought testify before his committee on why the administration changed its position on this case. At issue is a March memo the Department of Justice sent to the court stating that lower court had correctly ruled and the entire law should be thrown out. Previously, the administration had advocated for portions of the law being overturned. It is believe that Russ was one of the forces in the administration who helped drive change in position.
With the Congress out of session next week for the 4th of July holiday, we will suspend publication of Health Care Today next week and our next edition will be out on July 12th. We hope you all enjoy your holiday week next week.
June 21, 2019
The President’s plan to put the Medicare Part B drugs, those administered by a physician, on an international price index took a step back with a key Republican Senator coming out in opposition to the plan. Senator Grassley (R-IA) who chairs the Senate Finance Committee said he is concerned about the impact of the proposal on innovation. In other prescription drug news, Speaker Pelosi (D-CA) is coming under fire from some progressives in her party over her plan to have the government negotiate prices in the Medicare Part D program on the 250 most expensive medications. Under her proposal, the Secretary of Health and Human Services (HHS) would set the parameters for the negotiations on those drugs. Progressives want the federal government to negotiate prices on all of the drugs offered under the Medicare Part D program.
The Senate Committee on Health, Education, Labor, and Pensions (HELP) is planning on moving forward on legislation favored by the insurance industry to tackle surprise medical bills. The HELP Committee’s bill establishes a benchmark rate for compensating health care providers in disputes with insurance companies. Air ambulance interests are warning about access issues if the HELP Committee proposal moves forward. The bill would limit patients transported by air ambulances exposure to the amount insurance companies set as cost-sharing for those services. The committee is scheduled to mark the bill up on June 26th. We are also expecting the House Energy and Commerce Committee to act quickly on this issue as well.
The Federal Trade Commission (FTC) has given its approval to the acquisition of the second largest dialysis provider DaVita’s physician group practice by UnitedHealth Group. Optum, the health services platform of UnitedHealth Group, will need to sell off DaVita’s primary health group in Las Vegas to resolve competition problems. The FTC had maintained that the acquisition would drive up costs in the Medicare Advantage program in the Las Vegas market.
We find it interesting that there are a number of companies now offering devices that are supposed to connect to your brain to relieve stress, help with weight loss, and help with the conditions of disorders like ADHD and PTSD. The Food and Drug Administration (FDA) is charged with approving medical devices but sometimes the market can get ahead of the agency. It is not clear whether FDA will take any actions with the companies offering these products.
Today officially begins our summer season. We hope you enjoy this longest day of the year with your favorite outdoor activity whether it is playing golf, lounging at the pool, or sipping your favorite beverage on your porch. Enjoy!
June 14, 2019
The Departments of Treasury and Health and Human Services released a final rule to expand the use of health reimbursement arrangements (HRAs) so they can be used for more healthcare expenses. Under the proposed rule, funds in these accounts which receive a tax benefit can be used to purchase Affordable Care Act (ACA) plans on the exchanges reversing an Obama Administration policy prohibiting HRAs from being used to purchase plans on the exchanges. Opponents of the rule fear that sicker individuals will be forced into the exchanges and will face higher costs. The Trump administration believes it will offer small employers more options for providing coverage for their employees.
The House Ways and Means Committee convened a hearing this week, titled “Pathways to Universal Health Coverage,” to debate the House’s Medicare for All bill (H.R. 1384), a bill (H.R. 1346) to allow anyone over the age of 50 to buy into Medicare, and a bill (H.R. 2452) to allow the uninsured to buy into Medicare coverage. Representative Pramila Jayapal (D-WA), the sponsor of H.R. 1384 was elated about the hearing and said that each hearing helps build support for her Medicare for All bill. She also indicated she is going to seek a hearing in the Energy and Commerce Committee which shares jurisdiction over Medicare with the Ways and Means Committee. Republican Members were also pleased with the hearing welcoming the debate over universal health coverage and the prospect of eliminating private insurance and the high expected costs associated with Medicare for All. The American Medical Association has also come out in opposition to Medicare for All with its House of Delegates voting to oppose a move to a single payer health system. The vote was much closer than expected with 53% of delegates voting to oppose and 47% voting to support.
The issue of surprise medical bills continues to be in the spotlight. The Energy and Commerce Committee held another hearing on this issue where insurance interests and health care providers sparred over the policy options Congress is mulling. Insurance interests are urging this matter be settled by imposing rates on the health care system while health care providers favor arbitration. We also learned the Congressional Budget Office (CBO) is warning that the proposals developed by the Senate Committee on Health, Education, Labor, and Pensions (HELP) could lead to greater consolidation among hospitals.
The House Oversight and Reform Committee’s Subcommittee on Economic and Consumer Policy sent a letter to Juul Labs Inc. as part of an investigation into e-cigarette use by teenagers. Representative Raja Krishnamoorthi (D-IL) sent a letter to Juul’s CEO Kevin Burns asking for information around marketing strategy and advertising campaigns to determine if the company was improperly targeting younger customers. The letter uses comments made by former Food and Drug Administration Commissioner Scott Gottlieb to suggest Juul is primarily responsible for the epidemic of youth vaping.
Today is both Flag Day and National Bourbon Day. Whether you’re celebrating the Stars and Stripes or the country’s only native spirit – or both, for that matter – do it responsibly.
June 7, 2019
The debate over prescription drug prices was front and center again this week. Axios hosted an event where Senator Grassley (R-IA) who is Chairman of the Senate Finance Committee announced that he wants pharmaceutical companies to pay more for consumers who pass through the so-called “donut hole” in the Medicare Part D program and are receiving catastrophic coverage from Medicare. Senator Stabenow (D-MI) made an impassioned push for having the federal government negotiate drug prices in the Part D program at the same forum. And former Food and Drug Administration (FDA) Commissioner Scott Gottlieb reflected on his days at the Center for Medicare and Medicaid Services (CMS) when the Part D program was implemented, stating that he thought the outcomes that resulted from the creation of the program have been very good. Senator Cassidy (R-LA) announced he will be introducing five bills in the coming weeks on drug pricing issues, including one to allow for the payment over a period of years for the most expensive therapies. That idea was also floated by Senator Grassley at the Axios event. We are expecting the Finance Committee to have a bill on drug pricing out by June 19th.
The House Appropriations Committee reported the Agriculture Appropriations bill which funds the FDA and drew some interesting amendments. The committee adopted on a voice vote an amendment from Representative Robert Aderholt (R-AL), who chaired the subcommittee in the last Congress, to prevent federal funds from being used to review research on genetically modifying human embryos. Such a prohibition was carried in last year’s bill. The committee defeated an amendment offered by Aderholt to raise the minimum age for purchasing tobacco products from 18 to 21 and to limit online sales of e-cigarettes.
Good news came out this week on the Affordable Care Act’s (ACA’s) marketplaces. The rate filings indicate that there will only be modest price increases for plans sold in 2020. This marks the second year in a row with slight price increases indicating the marketplaces seem to be stabilizing. Meanwhile House Energy and Commerce Chairman Frank Pallone (D-NJ) and Ways and Means Committee Chairman Richie Neal (D-MA) wrote to CMS Administrator Seema Verma questioning the administration’s actions to make it easier for consumers to purchase plans from health insurance brokers rather than going through the healthcare.gov portal. CMS finalized a regulation in April making direct enrollment into ACA plans easier.
On Monday the Supreme Court ruled CMS must conduct notice-and-comment rulemaking or their policies could be invalidated. The Supreme Court struck down a CMS payment policy from fiscal 2012 that cut Medicare reimbursements to hospitals serving large numbers of low-income patients. The court ruled 7-to-1 that the CMS policy was invalid because the agency put it in place without conducting notice-and-comment rulemaking rejecting CMS’ argument that they have broad authority to interpret the Medicare statute.
Hospitals had another win in the courts this week when a federal district court ruled, for a second time, in favor of hospitals challenging the legality of Medicare payment cuts targeting certain hospitals in the 340B drug pricing program. The U.S. District Court for the District of Columbia found the 2019 payment rate to certain 340B hospitals under the Outpatient Prospective Payment System (OPPS) to be unlawful. At issue were payment cuts of nearly 30 percent implemented by the Department of Health and Human Services (HHS) in the 2019 OPPS final rule that went into effect January 1, 2019.
The drumbeat continues on the surprise medical bills issue. The Congressional Budget Office (CBO) released preliminary scores of some of the Senate proposals to address the issue. The proposal to set a benchmark payment rate floated by the Health, Education, Labor, and Pensions (HELP) Committee would save $25 billion over ten years, the committee’s arbitration model would save $20 billion over ten years, the network matching proposal from the committee would save $9 billion over ten years, and the bipartisan bill drafted by Senators Cassidy (R-LA) and Hassan (D-NH) among others would save $17 billion over ten years. The House Energy and Commerce announced another hearing on surprise medical bills next Wednesday. And some Democratic Senators on the HELP Committee are expressing reservations about addressing this issue absent efforts to strengthen the ACA. Senator Murphy (D-CT) expressed concerns about moving ahead on this issue without addressing what he views as destructive measures the administration has taken around the law. Senator Baldwin (D-WI) also expressed concern with moving forward with health legislation that does not fund more ACA outreach efforts, address the pending lawsuit against the law, and restore the cost-sharing reduction payments the administration terminated.
We cannot let this week commemorating the 75th anniversary of D-Day pass without a strong thank you to the brave soldiers who stormed the beaches on June 6, 1944.
May 31, 2019
The Food and Drug Administration (FDA) holds a much anticipated public meeting today on the benefits and risks associated with products from cannabis or cannabis derived products such as cannabidiol (CBD). Stakeholders are being permitted to make either a two-minute or a five-minute presentation to the FDA. Deputy Commissioner Amy Abernethy is leading a working group at the agency on this issue and has already been in dialogue with trade associations and other interests. The agency needs to asses the safety of allowing CBD to be added to foods and drinks and health claims manufacturers may make about their products. We don’t expect regulations or guidance to be produced quickly. However, Congress may jump in and direct FDA to do so.
Speaking of the FDA, Senator Durbin (D-IL) had some harsh words for acting Commissioner Ned Sharpless this week. Following a meeting the two had on e-cigarettes, Senator Durbin remarked that it was “one of the most alarming and disappointing” meetings he had in service in Congress. The FDA moved up their review of e-cigarettes a year to 2021 this past March but Senator Durbin wants the agency to move more quickly. Dr. Sharpless responded by saying FDA is committed to address the epidemic with youth vaping by restricting their access to flavored products.
The issue of surprise medical bills continues to gain attention. The Blue Cross Blue Shield Association weighed in urging Congress to direct out-of-network charges to be based on Medicare charges. AARP also weighed in on the discussion draft released by the Energy and Commerce Committee urging the committee to include office-based physician visits in its legislation. AARP also wants clarity about whether third party labs and imaging centers are included in the legislation. Meanwhile Senator Cassidy’s bill has grown its support in the Senate with nine additional Senators (5 Republicans and 4 Democrats) being added as cosponsors. Eleven Senators had joined the bill as original cosponsors.
The Centers for Disease Control (CDC) recently released new data on patients diagnosed with diabetes. The rate has dropped by more than one-third since 2009. There were 1.3 million new cases in 2017 down from 1.7 million in 2008. The rates of diagnosis of type 2 diabetes grew steadily at over four percent from 1990 until 2009. Researchers are not certain for the exact reasons for the decline but it is probably safe to say public awareness campaigns about diet and exercise have had a positive impact.
Let’s give a shout out to our audiologist friends on National Save Your Hearing Day.
May 24, 2019
Surprise medical bills continue to dominate the healthcare landscape in Washington. This week the Ways and Means Committee held a hearing on the subject featuring witnesses from the insurance industry perspective and the healthcare provider perspective. Two models have been put forward to solve the problem: establishing parameters for payment rates or establishing an arbitration system. Both models have faced criticism from insurers and providers alike with providers preferring arbitration and insurers favoring rate setting. The Senate Committee on Health, Education, Labor, and Pensions (HELP) released the outline of a bipartisan bill to address surprise medical bills, lower the cost of prescription drugs and overall healthcare costs, and improve the sharing of information among healthcare providers. The HELP Committee is expected to mark up their legislation in June. HELP Committee Chairman Alexander (R-TN) has stated he wants a bill on the President’s desk in July.
The other big issue – Medicare for All – received more attention this week as well with the House Budget Committee holding a hearing with three witnesses from the Congressional Budget Office (CBO). The hearing’s focus was not on a particular bill but rather to hear from the CBO officials about how the country can design a single payer healthcare system and the issues that policy makers would have to confront. CBO issued a report on moving to a single payer system earlier this month. CBO testified that a single payer system could reduce overall healthcare expenditures, but it also may reduce the amount and quality of care provided. Both sides seemed to find positive nuggets from the CBO testimony with Congressman Chris Stewart (R-UT) saying he loves talking about the issue of Medicare for All and the sponsor of one of the leading Medicare for All bills Congresswoman Jayapal (D-WA) stating that her bill addresses many of the issues raised in the CBO report.
On Thursday, the Democratic chairs and ranking Republicans of the Ways and Means and Energy and Commerce Committees released a discussion draft to Modernize the Medicare Part D Prescription Drug Program. Specifically, the bill would cap what seniors have to pay out-of-pocket for medications under Medicare Part D. The bill would also lower the government’s share of catastrophic coverage from 80% to 20% over four years. The committees are soliciting feedback on the proposal with comments due on June 6.
Senators McConnell (R-KY) and Kaine (D-VA) introduced a bill this week to raise the age for buying tobacco products to 21. The bill allows states to set even more stringent requirements for purchasing tobacco. The bill also covers e-cigarettes as there has been great concern over youth vaping with many health officials including Surgeon General Jerome Adams believing youth usage has become a health epidemic. Many of the health associations such as the American Cancer Society, the American Lung Association, and the American Academy of Pediatrics have offered praise of the bill.
The National Center for Health Statistics released some interesting findings from a survey about prescription drugs. Five percent of respondents stated they are not taking their medications as prescribed in order to reduce their costs while another nearly eighteen percent asked their doctor for a lower priced medication. And women were more likely than men to not take their therapies as prescribed to lower costs. Those who are near poor were the most likely to employ such tactics to reduce their costs.
This Memorial Day weekend we honor all the brave soldiers who made the ultimate sacrifice to protect our freedoms.
May 17, 2019
There was a lot of activity in the space of surprise medical bills this week. House Energy and Commerce Committee Chairman Pallone (D-NJ) and Ranking Member Walden (R-OR) circulated a discussion draft to stakeholders specifically seeking input on: increasing transparency for consumers; ensuring network adequacy; encouraging the development of state all-payer claims databases; surprise bills from air and ground ambulances (the discussion draft did not include ambulances in the prohibition on balance billing); and establishing a market-based benchmark to resolve out-of-network payment disputes between providers and insurers. Senators Cassidy (R-LA) and Hassan (D-NH) led a bipartisan group of nine Senators in introducing a bill that takes a different approach than the Energy and Commerce Committee draft bill. The Senators favor an arbitration model to settle payment disputes similar to the one used by Major League Baseball. And House Ways and Means Committee’s Health Subcommittee Chairman Lloyd Doggett (D-TX) announced a hearing on surprise medical bills for next week. The hearing is balanced between healthcare providers and insurance interests.
The House passed a bill, H.R. 987, largely on a party line vote to address drug costs. Republicans objected strongly to the bill because it also included a provision to block the Trump Administration’s short-term insurance plan rule which redefined those to be plans of one-year duration and eligible for three renewals. The drug pricing provisions of the bill enjoyed broad bipartisan support but only a five Republicans voted for the bill. The popular provisions include allowing generic drug manufacturers to sue brand name drug companies for failing to provide sufficient samples of their drug for testing. Another popular provision is one banning “pay-for-delay” arrangements where name brand drug companies pay generic drug makers to delay the market entry of their products. Finally, there was a provision to prohibit generic drug manufacturers of delaying entry of other generic drugs into the market which enjoyed bipartisan support.
The Centers for Medicare and Medicaid Services (CMS) issued a final rule for the Medicare Part D program. The final rule did not include the controversial provision in the proposed rule for plans in the Medicare Part D program to exclude drugs in the so-called protected classes if the drug prices rose too much. When Congress created the Medicare Part D program, it required plans to cover all drugs in the following classes: antidepressants, anti-psychotics, anticonvulsants, immunosupressants for transplant rejection, antiretrovirals and cancer drugs. The final rule also backed down from the proposal to require prior authorizations for certain drugs and only require them in limited circumstances. The final rule does move forward with the plans for more price transparency for patients. Under the final rule, plans will have to provide drug pricing data through the physician’s electronic medical records or e-prescribing software by 2021. This will allow prescribers to identify lower cost treatment options that may be available under the patient’s coverage.
After enjoying lots of praise last week over the announcement of their donation of pre-exposure prophylaxis (PrEP) used to reduce the risk of HIV infection, Gilead Sciences was back in the spotlight this week but this time facing criticism. A lawsuit was filed by competitor drug companies accusing Gilead of using anti-competitive practices to inflate the price of their HIV drug Truvada. The House Oversight and Reform Committee also held a hearing to examine the company’s profits from Truvada.
It is National Pizza Party Day so we hope your employer buys you lunch today!
May 10, 2019
Health and Human Services (HHS) Secretary Alex Azar made a big announcement that Gilead Sciences will be donating pre-exposure prophylaxis (PrEP) used to reduce the risk of HIV infection for up to 200,000 individuals each year for 11 years. This announcement is considered a major step forward for the administration’s goal of effectively eliminating the HIV epidemic by 2030. President Trump in his State of the Union address called for reducing HIV infections by 75 percent over the next five years and by 90 over the next ten years. There have been donations made globally in the past but nothing of this magnitude has been done in the United States.
The House passed several healthcare bills this week. Two bills, H.R. 1503 and H.R. 1520, passed unanimously. H.R. 1503, the Orange Book Transparency Act, requires name brand manufacturers to submit to the Food and Drug Administration (FDA) complete and timely information about their products’ intellectual property for inclusion in the “Orange Book” the FDA maintains for all approved medications. Generic manufacturers rely upon the Orange Book for making investment decisions. FDA also maintains a similar “Purple Book” for biologics. H.R. 1520, the Purple Book Continuity Act, codifies the requirements to maintain information on biologics in a similar fashion as is done in the Orange Book. The House also approved H.R. 986, Protecting Americans with Pre-Existing Conditions Act, on a largely party line vote. H.R. 986 pulls back the guidance the Trump Administration issued over Affordable Care Act (ACA) waivers.
The President got in the game of surprise medical bills this week with an announcement about principles he wants Congress to consider in crafting legislation to solve this problem. Notably, the President said Congress should outright ban balance billing. The administration also released the final rule to require manufactures of drugs covered by the Medicare or Medicaid program to include the list price or the Wholesale Acquisition Cost of medications that cost more than $35 for a month’s supply in any direct-to-consumer television advertisements.
It is with a heavy heart we note the passing of long-time New York Times healthcare reporter Robert Pear. Robert always had the inside scoop on pending healthcare issues and had a wealth of knowledge about health policy issues – probably more so than most of the people he covered on his beat.
On a lighter note, we wish all of the moms in our lives a very happy Mothers Day this weekend.
May 3, 2019
Medicare for All had its big week this week with the first ever congressional hearing over the proposal. The House Rules Committee held the hearing. The featured witness for the Majority was Ady Barkan, who suffers from ALS, and is the founder of the Center for Popular Democracy. Mr. Barkan made a passionate plea for a single payer system citing the difficulties he has had with his insurance company on coverage for necessary treatments for his condition. The Minority lead witness, Grace Marie Turner President of the Galen Institute, warned a single payer system could exacerbate some of the problems of our current system such as physician shortages. The Congressional Budget Office (CBO) also released a report this week on the policy considerations for establishing a single payer health system. The report did not analyze any specific bill, but rather identifies issues for consideration in creating such a system. Proponents of Medicare for All touted the report as progress in moving to a single payer system while opponents latched on to CBO’s warnings that moving to such a system would be disruptive and significantly increase government spending. Budget Committee Chairman John Yarmuth is planning a hearing later this month to discuss the CBO’s findings. We also understand that Ways and Means is considering their own Medicare for All hearing as well.
The House Judiciary jumped into the fray on prescription drug pricing and reported out four bills seeking to curb costs. The first bill, H.R. 965 – the CREATES Act, would ensure generic drug manufacturers would have sufficient access to enough samples of brand name medications. It also allows the Food and Drug Administration (FDA) to approve alternative Risk Evaluation and Mitigation Strategy (REMS) if generic and name brand manufacturers cannot agree on a shared one. The second bill, H.R. 2375, would make it harder for named brand manufacturers to enter into pay-for-delay agreements with generic manufacturers. This bill takes a slightly different approach to pay-for-delay agreements than a bill previously reported out of the Energy and Commerce Committee. The third bill allows the Federal Trade Commission to investigate pharmacy benefit managers. Finally, the committee reported a bill to prohibit named brand manufacturers from generating citizen petitions to the FDA aimed to slow down approval of generic drugs.
The House Appropriations Committee Subcommittee on Labor, Health and Human Services, and Education (Labor-HHS) reported out its appropriations bill this week. The bill provides $11.7 billion more than last year’s bill. The National Institutes of Health (NIH) received a $2 billion increase and the Centers for Disease Control (CDC) received a $900 million increase. The bill provides the Substances Abuse and Mental Health Services Administration (SAMHSA) $3.8 billion including funding for opioid treatment and prevention. For the first time in 20 years, the bill provides funding for gun violence research with NIH and CDC each receiving $25 million to conduct the research. The prohibition against agencies lobbying against gun violence – the so-called Dickey Amendment – remains in place in the bill.
The National Youth Tobacco Survey had to adjust the language they are using to better capture the rates of teen nicotine usage. The vaping devices sold by Juul Labs are so popular that “juuling” is considered a verb. Some teens also did not realize juuling is the same as using an e-cigarette. Teen vaping has been considered a health epidemic by our health officials including Surgeon General Jerome Adams. And we have seen Senate Majority Leader Mitch McConell announce he is going to introduce a bill to raise the minimum age to 21 for purchasing tobacco products including e-cigarettes.
May the force be with you this weekend!
April 12, 2019
In this week’s Affordable Care Act news, the Trump Administration requested to expedite oral arguments in the Fifth Circuit’s Texas v. Azar case, just a few days after announcing that the administration would be arguing to have the entire law thrown out should Judge Reed O’Connor’s decision hold up. A federal appellate court granted that request to expedite the case. Oral arguments are expected the week of July 8.
Those oral arguments will include one fewer state as Wisconsin has dropped out of the case. Originally siding with Texas and other, predominantly-Republican attorneys general, Wisconsin chose to withdraw from the case following the election of Democratic governor Tony Evers in November.
The oral arguments will also not include top DOJ lawyer Brett Shumate, who announced he was leaving the Department. Shumate was a top political appointee who had argued several high-profile cases during his two-year stint in the Trump Administration, including leading the oral arguments in the Texas case last fall. His departure is one of a handful of big-name departures from the administration’s health and legal teams. This week also saw the departures of two career CMS employees, Michael Nardone and Jim Golden, who both worked in the CMS office overseeing Medicaid and the Children’s Health Insurance Program.
It was a short week on Capitol Hill this week leading up to a two-week district work period, but that doesn’t mean it was without action. With drug pricing being a major point of emphasis in both parties, there was quite a bit of activity. Pharmacy Benefit Managers (PBMs) had their turn in the spotlight this week as some of the country’s largest PBMs were called before the House Energy and Commerce and Senate Finance Committees this week. The focus in the House hearing dealt with their role in the recent spike of insulin prices, whereas the Senate hearing dealt with the PBM’s role in the increasing costs of pharmaceutical drugs writ large.
Not to be left out, the House Ways and Means Committee passed a package of drug pricing bills this week. The Prescription Drug Sunshine, Transparency, Accountability, and Reporting (STAR) Act would, among other things, bring greater transparency to the rather opaque world of drug pricing. The bill was passed unanimously, mirroring other bipartisan action on the issue in the House Energy and Commerce Committee. It is expected that these bipartisan bills will be packaged together and likely see action on the House floor later this spring. Senate Finance Chairman Chuck Grassley remains cautiously optimistic that a bipartisan, bicameral bill will emerge, but is concerned that if Congress doesn’t pass something by June, it may not see action until next year – right in the throes of the Presidential elections.
With Congress out of session the next two weeks, we will return with a new edition of Healthcare Today on May 3. In the meantime, take a moment to knock out some spring cleaning, enjoy the blooming flowers, and enjoy the start of the NHL’s Stanley Cup playoffs.
April 5, 2019
The House Energy and Commerce Committee approved two bills to improve access to generic therapies as part of the ongoing efforts in Congress to try and tackle drug costs. H.R. 1499 prohibits the “pay for delay” agreements between brand manufacturers and their generic competitors. H.R. 965 (CREATES Act) limits the ability of brand drug makers from withholding samples from generic companies. The Ways and Means Committee is also scheduled to report a series of bipartisan bills aimed at controlling pharmaceutical prices. The bills are designed to bring more transparency to the pricing process.
The Energy and Commerce Committee also held a more spirited markup of legislation to improve the Affordable Care Act (ACA). The bills included less controversial measures such as a bill to provide additional resources for states to establish their own exchanges. But there was also a lot of vigorous debate over a bill to create reinsurance programs in states to help lower costs. Republicans attempted to include the so-called “Hyde” language in the bill to prohibit the use of federal resources to pay for abortions. Democrats objected stating this is a significant expansion of the Hyde language. Other bills aimed at halting the Trump administration’s regulatory actions around short-term health plans and guidance for ACA waivers also were reported.
President Trump took some steps back on his renewed attention on repealing and replacing the ACA stating that Republicans will wait until after the 2020 elections before putting forward proposals to replace the law. This news was welcomed by Republicans in the Senate who did not have much interest in attempting to move a controversial health care bill that would never get through the Democratic House. The President is now only expected to put forward principles for a comprehensive health care bill.
Chairman Alexander (R-TN) of the Senate Health, Education, Labor and Pensions (HELP) Committee announced his committee is working on a bill to address prescription drug prices, overall health care costs and the issue of the surprise medical bills. We understand that Chairman Grassley (R-IA) of the Senate Finance Committee is looking to move legislation in those areas in his committee’s jurisdiction. We are told the two chairmen are looking to use the model of the opioid legislation from the last Congress to blend policies from both committees. We are expecting committee action coming as early as May or June of this year.
On this National Walk to Work Day, we expect that everyone in the Washington area is still likely to get home earlier tonight than having to fight through the cherry blossom traffic on the roads!
March 29, 2019
The Trump administration is doubling down on its criticism of the Affordable Care Act (ACA) with three lawyers from the Justice Department writing the 5th Circuit of Appeals stating that the district court’s decision that the ACA is unconstitutional and should be stricken down should be affirmed. This is a bit of a shift as the Justice Department previously stated that some parts of the ACA should be stricken down but not the entire law. This sparked a strong reaction from Democratic Members of Congress. President Trump has also asked Senators Barrasso (R-WY), Cassidy (R-LA), and Scott (R-FL) to write a law to replace the ACA assuming it is stricken down in the courts. Two of the Senators (Barrasso and Cassidy) are physicians and Senator Scott is a former insurance company executive.
It was a bad week in the courts for the Trump administration with rulings coming down on the association health plan regulation and the work requirements Kentucky and Arkansas imposed in their Medicaid programs. The U.S. District Court in Washington halted the association health plan regulations from taking effect, finding the regulation was an “end-run” around the ACA. Another judge in the U.S. District Court in Washington found that the Department of Health and Human Services exceeded its legal authority to approve the work requirements in those two states. The individuals dropped from the rolls of the Arkansas Medicaid program will not automatically be reinstated under this ruling but are eligible to reapply in 2019.
The House Energy and Commerce Committee passed a series of bills to strengthen the ACA this week. Some of the bills add to the ACA by establishing a program to pay insurers to cover sicker individuals and providing resources for states to create their own health insurance bills. While other bills halt administrative actions by the Trump administration that Democratic Members of Congress believe undermine the ACA like the short-term health insurance rule. Some of the bills enjoyed bipartisan support while others were approved along party lines.
The Food and Drug Administration (FDA) is feeling the heat with a flood of products containing cannabidiol (CBD) hitting the markets. Products from lattes to shampoos to ointments have come online and are store shelves around the country. CVS health has announced it will be selling products in 800 store locations. The FDA approved last year the first CBD-based drug Epidiolex to treat epilepsy. But many have taken the passage of the farm bill last year authorizing the growing of hemp from which CBD is derived to be a signal to move forward with new products. FDA Commissioner Scott Gottlieb has opined about possibly setting a threshold where products with higher concentrations of CBD would have to go through the drug approval process while those products with lower levels would be considered a dietary supplement where FDA would just monitor the health claims made by the manufacturers of the products.
March 22, 2019
There was some good news coming out of the Centers for Medicare and Medicaid Services (CMS) with the initial report on the new quality program. In 2017 CMS launched the Quality Payment Program which is a value-based care program consisting of the Merit-based Incentive Payment System (MIPS) and Advanced Alternative Payment Models (APMs). The report indicated that a higher percentage of doctors participated in the program – 95 percent while CMS’ goal was to have 90 percent participation. The program is designed for healthcare providers to improve patient outcomes rather than increasing the number of healthcare services they provide. Physicians also saw their payments increase under this new program. More than 99,000 physicians received incentive payments under the APMs.
Attention to surprise medical bills continues to persist. BlueCross BlueShield Association and their trade association (America’s Health Insurance Plans) along with a coalition of business trade associations (National Retail Federation, Food Marketing Institute, etc.) sent a letter to Congress with their recommendations on how to proceed on the issue with warnings of the unintended consequences that could lead to higher costs of health insurance for employers. The letter was met with a sharp response from the two largest hospital associations – American Hospital Association and the Federation of American Hospitals. Brookings Institution is hosting a panel discussion on this issue today as well.
The Medicaid program was also in the news quite a bit this week. Legislation to advance Medicaid expansion moved forward in the states of Kansas and Idaho. Governor Laura Kelly (D-KS) campaigned on this issue and was able to lead all of the Democrats and 29 Republicans in the state House to advance the legislation. Idaho was a bit of a different story with the legislature responding to a ballot initiative to expand Medicaid that passed overwhelmingly. The Idaho House advanced a bill to expand Medicaid more narrowly than the ballot initiative had called for as was done earlier in the year in Utah. CMS approved a waiver from the state of Ohio at the end of last week to impose a work requirement in the state’s Medicaid program. This is all in the shadow of a new lawsuit in New Hampshire challenging work requirements in the Medicaid program, as well as a court decision soon coming on the fate of similar work requirements in Kentucky and Arkansas.
Food and Drug Administration (FDA) Commissioner Scott Gottlieb is continuing to make some noise as he heads out the door. Gottlieb threatened to pull all pod-based nicotine products from the market if the youth vaping usage numbers do not ebb. This follows a testy meeting the commissioner held with executives from Altria and Juul Labs. Gottlieb also said he will not be able to finish his work on cannabidiol (CBD) regulations before departing the agency on April 5th. FDA is expected to announce a working group to look at this issue led by Principal Deputy Commissioner Amy Abernathy and Acting Associate Commissioner for Policy Lowell Schiller. Abernathy is a possible candidate to succeed Gottlieb as commissioner. Gottlieb also made some waves when he said electronic health records (EHRs) need an appropriate level of oversight when they are doing things that “create risks for patients.” It is not clear what FDA could do in this area as the 21st Century Cures Act prohibited the agency from regulating EHRs.
As we kick off March Madness, we are reminded of the excitement and emotions of this time of year. Dreams will be made, and hearts will be broke. Blood, sweat, and tears will be shed – and that’s just among us fans. We wish you luck with your bracket and hope it’s still intact.
March 15, 2019
Ned Sharpless who is the director of the National Cancer Institute was named as the Acting Commissioner of the Food and Drug Administration (FDA). Reportedly Commissioner Scott Gottlieb has recommended Sharpless as his permanent successor. However, there are some other names in the mix to serve as the next Commissioner including Dr. Amy Abernethy, who is serving as the Principal Deputy Commissioner, and Health and Human Services (HHS) Assistant Secretary for Health Brett Giroir. Sharpless is an oncologist who served as the director of the University of North Carolina’s Lineberger Comprehensive Cancer Center.
The first parts of the President’s Budget hit Capitol Hill this week with the more detailed volumes scheduled to come out on Monday. The President’s budget would reduce the HHS budget overall by $14 billion next year. However, the President has also proposed to increase some priorities including $25 million in additional resources for combatting the opioid epidemic and $291 million for the Centers for Disease Control and Prevention (CDC) to take steps to fulfill the President’s commitment to dramatically reduce HIV infection over the next decade. The President’s budget also includes controversial proposals such as repealing the Affordable Care Act (ACA) and converting the Medicaid program to a block grant to states.
The Centers for Medicare and Medicaid Services (CMS) issued new guidance for states seeking to impose work requirements in their Medicaid programs. HHS Secretary Azar was pressed on this issue at hearings before the Senate Finance Committee and House Energy and Commerce Committee where Senators and Members inquired about the 18,000 individuals who fell off the Arkansas Medicaid rolls after the state-imposed work requirements took effect. These hearings took place as challenges to the Arkansas and Kentucky work requirements were heard before the DC District Court this week.
The Energy and Commerce Committee has launched an investigation into the short-term health insurance plans that do not need to be ACA compliant. The committee has sent letters to nine health insurance companies seeking details about the short-term plans that are being sold and how they are marketed. Chairman Pallone (D-NJ) is concerned about consumers being misled about these plans and thinking the plans include all of the protections of the ACA. The Chairman’s concerns are backed by a study from Georgetown University researchers who claim insurers and brokers are marketing these plans in a deceptive way.
Those of us from Irish descent hope everyone can celebrate and enjoy St. Patrick’s Day this weekend.
March 8, 2019
Food and Drug Administration (FDA) Commissioner Scott Gottlieb announced a sudden departure from the agency this week. The Commissioner is leaving next month and cited the grind of commuting from his home in Connecticut as one of the main reasons for his departure. Gottlieb has earned high marks for his aggressive actions around tobacco and e-cigarettes as well as his efforts around eHealth. In his resignation letter, Gottlieb cited the advancements the agency had made for “digital health tools and personal genetic tests.” A public meeting and a high-level working group to examine the issues with cannabidiol (CBD) was promised by the Commissioner to the House Appropriations Committee, but it is unclear whether he will convene that before his departure or leave it to his successor.
The drum keeps beating for the pharmaceutical industry in Washington. The House Ways and Means Committee’s Health Subcommittee Chairman Lloyd Doggett (D-TX) announced he was going to explore the tax implications for pharmaceutical companies that make contributions to non-profits that run patient assistance programs. A 2016 paper written by Austin Frerick questioned the value of the cost of the forgone revenue from the tax deduction compared to the benefit of the programs. Senate Aging Committee Chairwoman Susan Collins (R-ME) convened a series of hearings on drug prices this week. Senator Collins also rolled out a bill to require drug companies to disclose all of their patents. Finally, Senator Lindsey Graham (R-SC), who serves as Chairman of the Senate Judiciary Committee, announced that the Committee will be holding a hearing this year to examine the abuses of patents by drug makers.
Health and Human Services (HHS) Secretary Alex Azar made a big announcement this week about kidney care. Azar announced to the National Kidney Foundation’s patient summit that the Centers for Medicare and Medicaid Innovation (CMMI) is going to devise new innovative payment models for patients with end-stage renal disease (ESRD) and stage 4 and 5 kidney disease. The new payment model is expected to create incentives for home dialysis. The agency is also looking at incentives for transplantations. The Medicare program spends $113 billion annually on treating ESRD and kidney disease patients.
An impressive bipartisan group of Senators wrote a letter to HHS Secretary Azar urging him to initiate rulemaking around the confidentiality of alcohol and drug abuse records. The regulation governing these records, known as 42 CFR Part 2, was put in place in the 1970’s long before the passage of the Health Insurance Portability and Accountability Act (HIPAA) that put in place privacy and security provisions to safeguard patients’ medical records. The letter was led by Senators Joe Manchin (D-WV) and Shelly Moore Capito (R-WV) who were joined by 11 of their colleagues. Congress has attempted to legislate an update to the regulation but has not been successful in accomplishing the goal. The Senators are hopeful a rulemaking process can bring together all of the voices and perspectives to accomplish a sustainable compromise.
The Centers for Medicare and Medicaid Services (CMS) is examining how it adjusts payments to physicians and hospitals based upon their geographic location. The Medicare wage index sets payments based upon where they are delivered in an attempt to capture the labor costs in the market. There have been many problems with the wage index over the years when health providers in rural areas need to pull in workers from more populated areas. Speaking at the annual meeting of the Federation of American Hospitals, CMS Administrator Seema Verma expressed concerns about rural hospitals and said that she wants to address the disparity in payments to urban and rural hospitals. No specifics have emerged in terms of changes to the wage index, but those changes can be controversial from the shift in payments that come as a result.
March 1, 2019
The “Medicare for All” legislation was introduced this week with much fanfare and attention. Congresswoman Pramila Jayapal (D-WA) unveiled the legislation at a press conference on Wednesday announcing the bill has 107 original cosponsors, which is 17 less than the 115th Congress. The bill would phase in over a two-year period universal coverage under a federal government program consolidating the Medicare, Medicaid, TRICARE, and the Affordable Care Act (ACA) Exchanges but the Veterans Administration health care system and the Indian Health Service would be preserved. Participants in the program would not have to pay premiums, copays, deductibles or any out-of-pocket expenses. A coalition of large employers, the American Medical Association, and health insurers all came out in opposition. Wall Street also reacted with a decline in health sector stocks of 0.8 percent.
Drug prices remain in the headlines with the Senate Finance Committee hauling the Chief Executive Officers (CEOs) of seven leading pharmaceutical companies before the committee for a terse discussion of drug pricing and actions taken by the companies to protect their intellectual property. Speaking at an Atlantic Live event, Senator Alexander (R-TN) who is Chairman of the Senate Committee on Health, Education, Labor, and Pensions (HELP) said he is “very interested” in possibly eliminating or modifying the drug rebate system where pharmaceutical manufacturers offer discounts to the plans covering the drugs. HHS issued a proposed rule in January to eliminate rebates in the federal programs. The House Energy and Commerce Committee and Senate Finance Committee have both announced their intentions to specifically drill down on insulin pricing.
The Food and Drug Administration (FDA) Commissioner Scott Gottlieb announced on Tuesday at a speech before the National Association of State Departments of Agriculture that he is interested in exploring alternative approaches for overseeing the use of cannabidiol (CBD). Last year’s farm bill authorized the growing of hemp but there is a lot of uncertainty about the regulation of CBD which is believed to have many therapeutic benefits. Because there is not FDA approval for using CBD in consumable products those products cannot be sold across state lines. Commissioner Gottlieb was pressed on the issue before the House Appropriations Committee Agriculture Subcommittee and he told the subcommittee he would convene a meeting on the issue in April. Gottlieb also suggested he may need more guidance from Congress on the issue.
Opioids continues to be a big focus in the Congress. Energy and Commerce Committee Pallone (D-NJ) stated that combatting the crisis is a top priority for Democrats. House Appropriations Committee Labor, Health and Human Services, and Education (Labor-HHS) Subcommittee Chairwoman Rosa DeLauro (D-CT) announced that she will hold hearings to review how monies already appropriated for the epidemic are being spent and how effective those efforts have been. The Senate Labor-HHS Subcommittee heard from state health officials on the progress being made in this fight. The opioid epidemic continues to be a major focus this Congress.
February 22, 2019
The Centers for Medicare and Medicaid Services (CMS) released their projections of health care expenditures this week. As if things were not bad enough right now for drug manufacturers, the projections indicate spending on prescription drugs will grow faster than any other sector of our healthcare delivery system over the next decade. However, the report indicates that the projected growth is largely due to more Americans taking prescription drugs. The growth rate for prescription drugs is estimated around 6 percent and spending on physicians and hospitals are close behind at a little over 5 percent.
A big issue in Congress right now is surprise medical bills but states are also taking a close look at this issue. Nine states have already enacted comprehensive measures to address the issue. Those states include: California, Connecticut, Florida, Illinois, Maryland, New Hampshire, New Jersey, New York, and Oregon. Another sixteen states have partial measures on the books on surprise medical bills. States can only go so far though because self-insured plans are exempt from state regulation. That will only likely put more pressure on Congress for a federal solution. Speaking of a federal solution, the American Hospital Association (AHA) led a letter signed by four other hospital trade associations and the Association of American Medical Colleges to Congress outlining eight principles for Congress to consider in developing legislation. Also, the Brookings Institute was planning on convening a panel discussion on the issue of surprise medical billings but the event had to be cancelled with our snow storm on Wednesday.
The Food and Drug Administration (FDA) is planning on holding a meeting this spring to discuss ways to update the Dietary Supplement Health and Education Act of 1994 (DSHEA). FDA Commissioner Scott Gottlieb had stated the agency had planned to increase its oversight of the industry, but there is only so much FDA can do without updating the 25-year old law. The industry has seen tremendous growth and is projected to be a nearly $300 billion market over the next five years. Three out of four Americans are currently taking dietary supplements.
There is a new study out from Navigant Consulting showing a growing crisis facing rural hospitals. There are three main factors contributing to the hospitals vulnerability according to the report. A decline in private insurance in their payer mix, a decline in in-patient treatments, and an inability to keep pace with the latest technology developments. These hospitals are also facing a scheduled reduction in their Medicaid disproportionate share hospital (DSH) payments starting on October 1st. The Affordable Care Act (ACA) had set in motion reductions in DSH payments but the scheduled cuts have been pushed back multiple times by Congress. Coverage levels have not achieved the estimates made at the time the ACA was written making these payments more critical.
Facebook was the subject of a complaint filed this week with the Federal Trade Commission (FTC) about their privacy policies for critical health information. Facebook had offered platforms to where people with rare diseases could connect and share information. But the complaints allege Facebook did not have sufficient protections to the personal information contained in those platforms. Congress has taken note too with Energy and Commerce Chairman Frank Pallone (D-NJ) and Consumer Protection and Commerce Subcommittee Chairwoman Jan Shakowsky (D-IL) writing to Facebook Chief Executive Officer Mark Zukerberg asking for a staff briefing on the issues raised in the FTC complaint by March 1st.
On this National Margarita Day, we hope you can enjoy one to kick off your weekend. It is also National Sweet Potato Day so hopefully a healthy dinner will follow.
February 15, 2019
The Centers for Medicare and Medicaid Innovation (CMMI) rolled out at Station 13 in Southwest Washington a new payment model that will test new ways Medicare will pay for emergency treatment after someone calls 911. Health and Human Services (HHS) Secretary Azar, the Center for Medicare and Medicaid Services (CMS) Administrator Verma, and CMMI Director Boehler were all in attendance. Currently Medicare only reimburses ambulances for transports to hospital emergency rooms. Under this voluntary demonstration model, known as the Emergency Triage, Treat and Transport (ET3), ambulances could be reimbursed for taking patients to other care settings like doctors’ offices, urgent care or even treating the patient and releasing them. Administrator Verma noted that while 19 percent of Medicare beneficiaries are transported to hospitals by ambulance, many of them can be treated in lower cost settings. The model will be phased in with CMS accepting applications from ambulance providers starting this summer.
Issues around vaccinations have become a hot topic again with the Centers for Disease Control (CDC) reporting 101 cases of measles in 10 states. Three congressional committees are looking at the issue as well. The House Energy and Commerce Committee and the Senate Committee on Health, Education, Labor, and Pensions (HELP) are holding hearings on vaccine preventable diseases on February 27th and March 5th respectively. House Intelligence Committee Chairman Adam Schiff (D-CA) sent letters to the Chief Executive Officers (CEOs) of Google and Facebook to express concern that their platforms are an avenue for information discouraging parents from vaccinating their children and asking the CEOs about their efforts to provide medically accurate information on vaccines.
Ways and Means Committee Chairman Richie Neal (D-MA) and Ranking Member Kevin Brady (R-TX) announced this week that they are going to work together to lower drug prices. The committee held a hearing on drug prices on Tuesday where they expressed their commitment to bipartisan efforts to curb drug prices. Health Subcommittee Chairman Lloyd Doggett (D-TX) expressed his desire to keep government-negotiated pricing in the Medicare Part D program on the table. However, that policy will not receive bipartisan support. Senate Finance Committee Chairman Grassley (R-IA) has also made drug pricing a priority for his committee.
Medicare for All continues to be a contentious issue with Republicans calling for hearings on the proposal. But Medicare for More got more attention with bills introduced in the House and Senate to allow individuals over the age of 50 to buy into Medicare. The Senate bill is being led by Senators Stabenow (D-MI) and Baldwin (D-WI) and the House bill is being led by Congressmen Higgins (D-NY) and Courtney (D-CT). Congressman Higgins conditioned his vote for Speaker Pelosi on her commitment to allow his bill to receive a vote on the House floor.
CMS and the HHS Office of National Coordinator (ONC) put out two big rules this week on healthcare data. The ONC rule would require healthcare providers to give patients free electronic access to their health records. The CMS rule would require providers participating in the federal health programs to share the electronic medical records with their patients. The rules also require electronic health record (EHR) providers to use web-based technologies to allow for easier interfaces with apps that patients can download. The proposals were met enthusiastically from the tech community, but hospitals expressed some concern with the proposals.
Finally, both chambers of Congress passed a funding bill to keep the government operating through the fiscal year. President Trump has signed the legislation into law. For health care the bill includes $3.08 billion in discretionary funding for the FDA, $5.8 billion in funding for the Indian Health Service, $5.7 billion in funding for the President’s Emergency plan for AIDS Relief, and $3.1 billion for global health programs.
February 8, 2019
Things are gearing up in Congress on healthcare. Next week the Energy and Commerce Committee will hold its first legislative hearing on three bills seeking to bolster the Affordable Care Act (ACA). The first bill, H.R. 986 – the Protecting Americans with Preexisting Conditions Act, would prohibit the Secretaries of Treasury and Health and Human Services (HHS) from implementing and enforcing guidance the Trump administration issued to states for Section 1332 waivers for states to not have to comply with all of the provisions of the ACA. Many critics of the guidance thought it allowed states to remove patient protections from the law. The second bill, H.R. 987, directs the Secretary of HHS to promote the availability of insurance on the Exchanges and financial assistance for coverage. The bill also prohibits the use of funds for promoting non-ACA compliant plans such as the short-term plans allowed under the new Trump administration regulation allowing for those plans to have a one-year duration and are eligible to be renewed three times. The third bill, H.R. 1010, prohibits the Secretary of HHS from enforcing the short-term health plan regulation.
The President’s Council of Economic Advisers (CEA) issued a report today on the ACA. The CEA report finds that the “reforms” the administration helped put in place – the repeal of the penalty for the individual mandate; the short-term health plan regulation; and the association health plan regulation – do not sabotage the ACA but rather provide for “a more efficient focus of tax-funded care to those in need.”
The American Medical Association (AMA) led a letter to Congress on the issue of surprise medical bills. The letter puts forward seven goals for Congress to consider in crafting legislation around this issue. Specifically, the letter takes issues with narrow insurance networks and encourages more protections for patients including creating an alternative dispute resolution system. The letter was signed by over 60 national physician and other healthcare association and over 40 state associations.
The President touted several initiatives in the healthcare space in his State of the Union Address. The President called for Congress to pass legislation to lower drug prices including putting a cap on out-of-pocket expenses for seniors. The President also announced a plan to lower HIV infections by 75 percent over the next five years and by 90 over the next ten years. The last healthcare issue the President raised was he plans to request Congress to provide $500 million over the next ten years for childhood cancer research. The first two items received some bipartisan praise but the final item drew criticism from Democratic leaders as not being ambitious enough.
We are sad to see the passing of the former Chairman of the Energy and Commerce Committee John Dingell. Chairman Dingell served nearly 60 years in the Congress and 16 years as chairman casting a very large shadow in Congress.
February 1, 2019
Health and Human Services (HHS) Secretary Alex Azar along with HHS Inspector General Daniel Levinson announced a proposed rule to make significant changes in drug pricing under the Medicare Part D program and the Medicare Advantage plans. Under the proposed rule, rebates offered by drug manufacturers to pharmacy benefit managers (PBMs) would be excluded from the safe harbor protection from the Anti-Kickback statutes. It would also create a safe harbor for discounts offered directly to patients. The criticism of the current system is that it encourages drug manufacturers to keep their list prices high and offer larger discounts to the plans for covering the therapies. Congress would need to take action to put in place a similar system for private insurance companies. Senate Finance Committee Chairman Chuck Grassley (R-IA) reacted favorably to the proposal while the House Ways and Means Committee Chairman Richie Neal (D-MA) and House Energy and Commerce Committee Frank Pallone (D-NJ) criticized the plan stating it will increase Medicare spending overall and raise the cost of Medicare to seniors.
Speaking of Senator Grassley (R-IA), he plans to meet in the next two weeks with Chairman Richie Neal (D-MA) and House Oversight and Reform Committee Chairman Elijah Cummings (D-MD) about finding common ground on drug pricing legislation. President Trump reached out to his friend Congressman Mark Meadows (R-NC) who serves on the Oversight and Reform Committee to tell him to tell Chairman Cummings the President is serious about working together on lowering drug prices. Perhaps this will a bright spot for bipartisan legislative action this year.
HHS Deputy Secretary Eric Hargan told an audience at the Brookings Institution that HHS plans to release two rules later this year focused on the Anti-Kickback statutes. Many have criticized those laws for inhibiting better coordinated care. The law prohibits referral of Medicare patients to entities with which the physician has a financial relationship.
The House Energy and Commerce and Education and Labor Committees are both holding hearings the morning after the State of the Union Address on the issue of the Texas lawsuit (Texas v. United States) and its impact on individuals with pre-existing medical conditions. This was a winning issue for Democrats in the elections last year and they certainly want to keep this issue alive.
We hope everyone enjoys the big weekend coming up with Punxsutawney Phil emerging at Gobbler’s Knob and the Patriots and Rams meeting in the Super Bowl. We won’t ask you to pick sides in the big game but we do hope you will join us in rooting for Phil to not see his shadow!
January 25, 2019
The federal government shutdown hits day 35 today, but there are rumors starting to spark about a possible deal coming together. At time of writing, the President is scheduled to make remarks in the Rose Garden today that appear to suggest that he will endorse a continuing resolution to temporarily fund the government for three weeks. The Food and Drug Administration (FDA) is going to run out of user fees next month sometime between February 17th and 28th. The agency assesses user fees on drug and device companies but the agency needs an appropriation to collect those fees. A lot of outside voices, ranging from patient groups to providers to the trade association for medical devices, are strongly urging a reopening of FDA. The Energy and Commerce Committee is holding a hearing next week on the impact of the shutdown on agencies under its jurisdiction including the FDA.
The issue around surprise medical bills got more attention this week with the White House convening a roundtable on Wednesday about the issue. The President convened a number of people who were hit with surprise medical bills and tasked Health and Human Services (HHS) Secretary Azar and Labor Secretary Azar with coming up to a solution for the problem. Capitol Hill is also very engaged on the issue with the leaders of the Senate Finance and Health, Education, Labor, and Pensions (HELP) Committee’s meeting on the subject. HELP Committee Chairman Alexander (R-TN) suggested that insurance companies and hospitals should take matters into their own hands to fix the problem and warned that if they don’t do so, Congress will do it for them. A bipartisan group of senators led by Senator Cassidy (R-LA) released a draft bill last September to put limitations on providers’ abilities to balance bill patients.
We are now seeing some action in Congress on the issue of drug prices. The House Oversight and Reform Committee has scheduled a hearing for Tuesday featuring patients and drug pricing researchers. The committee had previously sent letters to 12 drug companies about pricing for their specific products, but it does appear as though witnesses from those companies will appear next week. Not to be outdone, the Senate Finance Committee has scheduled their own hearing on the same day. The panel will hear from patient advocates, economists, and other witnesses on ways to lower drug prices.
We are also seeing the new House majority working on what was a major campaign promise last year. On Tuesday, the House Ways and Means Committee is holding a hearing titled “Protecting Americans with Pre-Existing Conditions.” Now that many of the House committees have gotten through their early-session organizational meetings and their rosters are being set, there is likely to be more committee action on the priorities of House Democrats.
NORC at the University of Chicago released some new survey data this week on the Medicare-for-All policy proposal. NORC found that a majority of Americans (56%) have not heard about the proposal and similarly a majority (55%) believe it would be a voluntary system where individuals could choose between private insurance and government offered insurance. Lead sponsor Congresswoman Jayapal (D-WA) said that they are still working out details for the bill. She plans to release a more detailed version of the legislation that offers more specifics around reimbursements for physicians and hospitals and benefits available to patients. Interestingly, the bill number this Congress will not be H.R. 676, which has historically has been used for the Medicare-for-All vehicle. This will be the first time in 16 years it has a different number. For the opposition, the Partnership for America’s Health Care Future, a broad coalition of insurance, hospital, physician, and business organizations, launched a campaign featuring an anti-single payer video that talks about the importance of choice in an affordable health system.
January 18, 2019
Drug pricing continues to be a dominant issue in the healthcare world in Washington. Health and Human Services (HHS) Secretary Alex Azar had several significant meetings this week on this topic. The Secretary met with Chairman Cummings (D-MD) of the House Oversight and Reform Committee about legislation the congressman introduced to peg drug prices in the U.S. to the median price paid by other countries. The Chairman described the meeting as “a good start” and believes the Secretary wants to get things done. The Centers for Medicare and Medicaid Services (CMS) has proposed a similar pricing structure for Medicare Part B drugs.
The Secretary also met with the Republican Senators on the Senate Finance Committee as well as Senate Health, Education, Labor, and Pensions (HELP) Committee Chairman Lamar Alexander (R-TN) as some Republican Senators have expressed concern about the proposal for Part B drugs. Finally, House Energy and Commerce Committee Oversight Subcommittee Chairwoman Diana DeGette (D-CO) outlined her oversight agenda for the subcommittee including drug pricing with a focus on insulin. Executives of drug companies should be prepared to come before her subcommittee this year. Ironically, drug prices fell 0.6 percent in December making it the lowest year-over-year monthly rate since 1973.
The House Ways and Means and Energy and Commerce Committees continue to organize this week. Congressman Lloyd Doggett (D-TX) was named the Health Subcommittee Chairman on Ways and Means and Congresswoman Anna Eshoo (D-CA) was named the Health Subcommittee Chairwoman on Energy and Commerce. Traditionally, Doggett has had an aggressive stance on Rx prices. In the past, Doggett has challenged Big Pharma and called on President Trump to lower prescription drug prices. Their Ranking Republican Members will be Congressman Devin Nunes (R-CA) and Congressman Michael Burgess (R-TX) respectively.
The partial federal government shutdown continues with no end in sight and an interesting back and forth between President Trump and Speaker Pelosi. The Speaker sent the President a letter rescinding the offer for the House to host the State of the Union address on January 29th. The President followed by sending a letter to the Speaker cancelling a planned codel minutes before the Speaker and other Members were expected to depart. The Food and Drug Administration (FDA) Commissioner Scott Gottlieb warned on Tuesday that the agency’s program for new drug reviews, the so-called PDUFA, will run out of resources in a few weeks. FDA has also furloughed a number of employees and has halted some discretionary activities in an attempt to stretch their very limited resources. The shutdown is also affecting agencies, even those with an appropriation, from moving forward on their rulemaking. Click here to read the Prime Policy Group report on that aspect of the shutdown.
The confirmation hearing for William Barr to be the next Attorney General revealed some interesting views from the nominee. Mr. Barr stated that while he disagrees with states legalizing marijuana for medicinal or recreational purposes, he will not have the Justice Department go after any marijuana companies operating in those states. That position is similar to the Justice Department position under President Obama but in contrast to the position of former Attorney General Jeff Sessions.
On this National Peking Duck Day, we hope our Northern Virginia readers get a chance to enjoy some at our favorite spot for the dish – Peking Gourmet in Falls Church.
January 11, 2019
There was a lot of action this week on the drug pricing front. Senators Sanders (I-VT) and Booker (D-NJ) along with Congressman Cummings (D-MD) unveiled a package of three bills aimed at curbing drug prices. The three bills included one to allow for the importation of drugs from other countries, one to allow for negotiated pricing in the Medicare Part D program, and one to peg the prices the federal government and private insurance plans pay to the costs of those drugs in other countries. The third bill tracks closely with the Trump Administration’s proposal for changing the pricing of drugs covered under Part B of Medicare. Senator Grassley (R-IA) also outlined a three-bill package to curb drug prices. Grassley teamed with Senator Klobuchar (D-MN) on a bill to allow for the importation of drugs from Canada. The other two bills include a measure to stop the so-called “pay-for-delay” pharmaceutical deals and a bill to block brand name pharmaceutical companies from blocking generic versions of their drugs.
It was announced that Congressman Cummings will be meeting with Health and Human Services (HHS) Secretary Azar, at the Secretary’s invitation, to discuss drug pricing. Congressman Cummins will also be interviewed on 60 Minutes on Sunday night on his committee’s investigative agenda including oversight of the pharmaceutical industry.
The House approved the third title of the resolution implementing the Rules for the House of Representative. This title specifically authorizes the Speaker and the House General Counsel to engage in the lawsuit challenging the constitutionality of the Affordable Care Act (Texas v. the United States). The House Rules package enjoyed bipartisan support including three Republican members voting in favor of this title. Click here for Prime Policy Group’s summary of the new House Rules.
The oversight of the process to write the administration’s short-term healthcare plan regulation began this week with Democratic healthcare leaders sending a letter requesting responses to two previous letters sent last spring and additional information. The Members also asked for a staff briefing on the rulemaking. The letter was signed by Congressmen Neal (D-MA), Pallone (D-NJ), Scott (D-VA) along with Senators Wyden (D-OR) and Murray (D-WA).
There has also been a lot of activity around single-payer healthcare systems. Congressman Yarmuth (D-KY) who Chairs the House Budget Committee issued a letter asking the Congressional Budget Office (CBO) to prepare a report on the issues Congress would face with a single-payer healthcare system in terms of enrollment, administration, coverage, and cost-sharing. The Budget Committee along with the Rules Committee are expected to hold hearings on issues involved with the House considering legislation to create a single-payer health system. Governor Polis (D-CO) in his State of the State address called upon members of the legislature to create a universal healthcare system for residents of the state. On the other side, the Chamber of Commerce has announced blocking a single-payer healthcare system will one of its priorities and the American Hospital Association is warning about the dangers of moving to such a system.
For our readers in the Washington, D.C. area, we hope you remain safe in our first snow storm expected this weekend.
January 4, 2019
The 116th Congress convened this week with the historic re-election of Nancy Pelosi as Speaker of the House. The Democratic Majority released this week their package of new rules for the House of Representatives. The resolution making these rules changes was divided into three titles. On the opening day of Congress, the House voted to approve the first title of the rules package which authorized the Speaker and the General Counsel of the House to engage in the lawsuit (Texas v. United States) challenging the constitutionality of the Affordable Care Act. The House today approved the second title creating the Select Committee on Modernizing Congress which is charged with looking at ways to make the House more transparent and accountable and looking at issues such as leadership development, scheduling, and staff diversity and retention. Congressman Derek Killmer (D-WA) was named the Chair of the select committee by Speaker Pelosi. The third title of the rules package formally authorizes the Speaker and General Counsel to intervene in Texas v. United States and will be voted on next week.
We are now on day 14 of the partial government shut-down as a result of the inability of Congress to pass another continuing resolution (CR) when the last one expired at midnight on December 21st. The Department of Health and Human Services (HHS) and key agencies in HHS such as the Centers for Medicare and Medicaid Services (CMS) remain open because their appropriation was signed into law in September. However, the ability for HHS and its agencies to advance rulemakings has been stymied as the Office of Management and Budget (OMB) does not have an appropriation and many OMB employees are furloughed. Outlook for a resolution of the shut-down is not very clear.
We now know the new Senators on the key healthcare committees. Senators Lankford (R-OK), Young (R-IN), Daine (R-MT), Hassan (D-NH), and Cortez Masto (D-NV) are all joining the Senate Finance Committee and Senators Romney (R-UT), Braun (R-IN), and Rosen (D-NV) are joining the Senate committee on Health, Education, Labor, and Pensions (HELP). We also saw the departure of Senators Young and Bennet (D-CO) from the Senate HELP Committee.
December 21, 2018
Editors Note: Healthcare Today is going to take a much needed break for the holidays. We will publish our next edition on January 4th. We hope you are all able to enjoy the holidays with your family, friends and loved ones.
Late in the day last Friday Judge Reed O’Connor of the Federal District Court in Fort Worth, Texas issued a partial summary judgement in the case Texas v. the United States. This is the case brought by a number of Republican governors and attorneys general challenging the constitutionality of the Affordable Care Act (ACA) now that the penalty for non-compliance with the individual mandate has been removed from the law. The plaintiffs argued that since the Supreme Court upheld the law in its ruling over NFIB v. Sebelius that Congress based upon Congress’ taxing authority the individual mandate is no longer constitutional under the Commerce Clause of the Constitution. The plaintiffs further argued that since the individual mandate is not severable from the rest of the law, the entire law must be stricken down.
While Judge O’Conner agreed with the plaintiffs that the law is unconstitutional, he refused to grant the plaintiffs the injunctive relief they requested and instead only issued a partial summary judgement which will allow the law to stand pending further appeal. White House Press Secretary Sarah Sanders said after the case was handed down that the law stands pending further appeal. And we saw that Centers for Medicare and Medicaid Services (CMS) Administrator Seema Verma tweeted on Friday night that the ruling had no bearing on enrollment or coverage under the ACA.
The new Democratic majority in the House will likely vote early on to join the case and appeal the judgement to the 5th Circuit Court of Appeals. The House will likely be joined by a number of Democratic governors and attorney generals. The expectation is that appellate court decision will be appealed to the Supreme Court. The House will also likely vote early in the session on legislation containing the ACA protections for individuals with pre-existing conditions.
Everyone in Washington is on pins and needles as we are on the verge of a possible partial shut-down of the federal government with the current continuing resolution (CR) expiring at midnight tonight. Negotiations are on-going as the White House and Congress seek a path forward for the next CR. About 75 percent of the federal government is already funded by regular appropriations bills passed by Congress and signed into law. If there is a government shut-down, the Department of Health and Human Services and all of its agencies will remain open but the Food and Drug Administration (FDA) would not be funded without another CR. There is some discretion in terms of how the federal government actually shuts down, so we don’t yet know whether all functions of FDA will be shuttered or if some operations can continue in some fashion.
U.S. Surgeon General Jerome Adams declared the use of e-cigarettes by children a health epidemic in the country. This is a very significant step taken by the Surgeon General as there have been very few health epidemics declared by Surgeon Generals over the years. Dr. Adams called upon parents, teachers, health professionals, and state and local governments to take actions to curb the use of these products by children. For example, including e-cigarettes as part of smoke-free indoor air policies, placing greater restrictions to teen access to these products at the retail level, and adopting smoke-free policies for homes and vehicles are all steps that can be taken to curb use of e-cigarettes by teens.
The President signed the Farm Bill into law this week which means the production of hemp is now legal. FDA will begin their work to establish regulations for hemp and its main component cannabidiol (CBD). It is believed that there are many health benefits associated with CBD in terms of reducing swelling, pain relief, and helping with anxiety. FDA will be assessing how products containing CBD should be marketed and what kinds of health claims can be made about these products.
December 14, 2018
Things are heating up over the issue of fetal tissue research. The House Oversight and Government Reform Committee’s Subcommittee on Healthcare, Benefits, and Administrative Rules Chaired by Congressman Jim Jordan (R-OH) and Subcommittee on Government Operations chaired by Congressman Mark Meadows (R-NC) held a hearing this week on exploring alternatives to fetal tissue research. Republicans at the hearing cited a study exploring the benefits of using discarded thymus tissue from newborn babies. The Democrats on the committee pointed out that the study’s author wrote a letter clearly stating that his paper does not support the claim that fetal tissue research is no longer needed. Also, Congresswoman Dianne DeGette (D-CO) who is the likely Chair of the Energy and Commerce Committee’s Subcommittee on Oversight and Investigations announced her intentions to hold a hearing on this issue with the likely focus on the Department of Health and Human Services (HHS) audit on any contract involving fetal tissue. The HHS audit has suspended many research projects.
The House approved a bipartisan package of Medicaid bills known as the IMPROVE Act (H.R. 7217). The bill exempts complex rehab technology (CRT) manual wheelchairs from the competitive bidding program and provides an 18-month pause on the application of bidding derived pricing on CRT wheelchair accessories. The bill also provides some short-term extension to two Medicaid programs. The spousal impoverishment rules which allow more flexibility to couples while seeking home and community-based services is extended for three months. The Money Follows the Person demonstration program which assists transitions of older adults with chronic conditions back to their community was also extended for three months. These provisions were offset by imposing new penalties for drug companies that misclassify therapies as generic to lower rebate payments. The offset policy is one supported by the Senators Grassley (R-IA) and Wyden (D-OR) who will serve as the Chairman and Ranking Member respectively of the Senate Finance Committee in the next Congress.
A coalition has been formed to advance legislation to address the issue of surprise billing when patients receive significant medical bills despite having health insurance stemming from the provider networks of the insurance plans. Members of the coalition include the America’s Health Insurance Plans (AHIP), American Benefits Council, Blue Cross Blue Shield Association, Consumers Union, The ERISA Industry Committee, Families USA, National Association of Health Underwriters, National Business Group on Health, and the National Retail Federation. The American Hospital Association and the Federation of American Hospitals fired back at the coalition and issued a statement critical of the insurance companies networks of providers.
The pharmaceutical industry’s efforts to roll back the policies put in place by the Bipartisan Budget Act to close the so-called donut hole in the Medicare Part D program are facing opposition from incoming House Speaker Nancy Pelosi (D-CA). This week Leader Pelosi expressed concerns with changing the policy from the Bipartisan Budget Act and believes she is supported by many in her caucus.
December 7, 2018
Health care spending was down across the board last year and in fact dipped below the overall growth of our economy. That is the first time since 2013 that health care did not outpace the economy and so healthcare represents a slightly smaller share of the economy as a result. The economy grew at a robust 4.2 percent and healthcare spending only grew at 3.9 percent. The slowdown was across the board covering private insurance and providers and government programs such as Medicare and Medicaid. Most notably Medicaid spending growth slowed to 2.9 percent.
We saw an improvement in the enrollment in the Affordable Care Act (ACA) exchanges during the last week in November. Enrollment is now down 6 percent from last year as opposed to the 9 percent it was down a week ago. It is possible that Medicaid expansion is part of the story here. For example, in Virginia 55,000 fewer residents signed up for plans in the exchanges but 117,000 Virginians enrolled in the Medicaid program. There are obviously other factors including this being the first enrollment period in which the individual mandate is not in effect.
Senators Grassley (R-IA) and Wyden (D-OR) appear to be getting focused on drug pricing. The two Senators introduced a bill (S. 3702) to prevent drug companies from overcharging in the Medicaid program. The bill would authorize the Department of Health and Human Services (HHS) to fine drug companies that knowingly misclassify products in the Medicaid program to recover rebate payments. Mylan had misclassified EpiPen as a generic drug in the Medicaid program to pay lower rebates to the program than if EpiPen had been classified as a branded product. This bill introduction may be the first in a serious of steps the two will take together in their leadership of the Finance Committee around drug pricing.
HHS released a report this week about improving our healthcare system through choice and competition. Secretary Azar and Brian Blase of the National Economic Council previewed the report at an event at the American Enterprise Institute . The report makes 50 recommendations to Congress, state governments and the executive branch on steps that can be taken to increase choice for consumers and competition in our health care system. Included in the report are specific recommendations to loosen the restrictions on physician ownership of hospitals put in place by the ACA as well as state certificate of need requirements for physicians and hospitals.
On this day of infamy, we remember the brave soldiers who tragically lost their lives on this morning 77 years ago today and the brave men and women who fought in the ensuing war. After watching the incredibly moving tribute from former Senator Dole (R-KS) to President Bush this week, this memory of our greatest generation is even more heartfelt.
November 30, 2018
The Centers for Medicare and Medicaid Services (CMS) released a proposed rule on Monday as part of the ongoing efforts of the Trump administration to try and lower the cost of prescription drugs. The proposed rule would grant more flexibility around the so-called “protected classes” of medications in the Medicare Part D program. The protected classes of drugs are antidepressants; antineoplastics; antipsychotics; antiretrovirals; and immunosuppressants. Medicare Part D plans currently must offer substantially all therapies in those classes. The proposed rule would allow plans to impose a prior authorization for drugs in those classes. It also allows plans to exclude drugs if it is only a new formulation of an existing drug or if the price has increased beyond certain thresholds. Patient groups and Democratic Members of Congress have protested this proposed rule. CMS Administrator Seema Verma has defended the proposal by saying that consumers can choose plans that do not take advantage of this addition flexibility.
CMS rolled out this week models for states to apply for waivers from the requirements of the Affordable Care Act (ACA). Section 1332 of the ACA allows states to apply for waivers from the coverage requirements of the ACA so long as the coverage offered in the state is as robust and affordable as those plans offered under the ACA. CMS put forward four models for waiver applications that they believe will be compliant with Section 1332. One of the models would allow states to direct subsidies to a defined-contribution account that the consumer can use to cover the cost of premiums or out-of-pocket expenses.
We also saw ACA enrollment numbers this week. Halfway through the enrollment season there are only about 100,000 sign-ups per day which marks a 9.2 decline from last year. This is the first enrollment period where the individual mandate is no longer in place. Premiums in net are projected to decline and in the areas of the country where premiums are increasing they are generally modest increases.
The Centers for Disease Control and Prevention released a rather dark report this week on mortality in the United States. Life expectancy declined from 78.7 years to 78.6 years. This marks the third year in a row where life expectancy has declined or stayed flat a phenomenon we have not seen since the Spanish flu outbreak a century ago. Two of the biggest drivers behind the decline in life expectancy are due the rise in deaths from opioids overdose and suicides. Seventy thousand people died from a drug overdose last year making in the highest number ever and an increase of nearly ten percent from last year. The suicide rate went up as well by nearly 4 percent.
“The market for Obamacare plans is shrinking but not collapsing, two years after President Donald Trump said not repealing the program would “destroy American health care forever.” More than halfway through the 45-day enrollment period, fewer people have selected plans for 2019 on healthcare.gov than in the same period a year ago, new government data show. The website handles enrollment in Affordable Care Act plans for 39 states. The decline in signups follows an effort by the Trump administration to promote cheaper coverage with fewer consumer protections, which critics called an attempt to undermine Obamacare. Congress also lifted the individual-mandate penalty for going without health insurance — a fee of 2.5 percent of income that was intended to discourage healthy people from waiting until they got sick to purchase coverage. That change takes effect in 2019. The number of people signing up for ACA plans is “surprisingly robust, given all the headwinds,” said Larry Levitt, senior vice president for health reform at the Kaiser Family Foundation, a research group.”
“The Trump administration on Thursday told states it will allow them to use ObamaCare insurance subsidies to help people pay for plans that don’t meet the law’s coverage requirements. The new use of subsidies is part of a larger push toward giving states more flexibility to waive ObamaCare requirements and pursue conservative health care policies that were previously not allowed under the Obama administration. Currently, states can apply for waivers from certain ObamaCare policies in order to help shore up individual insurance markets. The waivers were designed with specific “guardrails” meant to ensure that the waivers met at least the same coverage level as under ObamaCare. Trump administration officials emphasized on Thursday that the pre-existing protections written into the Affordable Care Act (ACA) will not be changed. “Critics of state flexibility will always assume the worst,” Centers for Medicare and Medicaid Services (CMS) Administrator Seema Verma said on a call with reporters. “The ACA’s pre-existing condition protections cannot and will not be changed.” Yet the new guidance loosens those guardrails and could allow states to subsidize health plans that exist outside the traditional ObamaCare insurance market, while also reducing subsidies for more comprehensive plans.”
“The Trump administration on Monday proposed changes to Medicare’s prescription drug benefit that would affect patients’ costs over the next few years, creating winners and losers. Medicare’s administrator, Seema Verma, said the goal is to lower costs for beneficiaries and modernize the government’s flagship health insurance program for seniors and the disabled, covering about 60 million people. The proposals apply to two popular parts of Medicare: private Medicare Advantage plans that offer comprehensive healthcare coverage, and prescription drug plans also offered by private insurers. Changes would take place in 2020 at the earliest. “For beneficiaries there are trade-offs,” said Tricia Neuman, a Medicare expert with the nonpartisan Kaiser Family Foundation. “Some could see cost-sharing for their drugs go down, but premiums are expected to rise.” Verma said the changes, if finalized, would ultimately save money for beneficiaries by sharpening competition among the insurers who deliver Medicare Advantage and prescription coverage.”
November 21, 2018
The Centers for Medicare and Medicaid Services (CMS) approved another waiver for the state of Kentucky to allow the state to impose work requirements on some Medicaid recipients. The state’s first attempt to impose work requirements was successfully challenged in the courts. The incoming governors in Wisconsin and Michigan will have a difficult time unwinding Medicaid changes imposed by their Republican predecessors. While both governors-elect support Medicaid expansion, they also both face Republican controlled legislatures.
The Kaiser Family Foundation has a new study out that shows insurance plans purchased on the Affordable Care Act (ACA) exchanges are expected to decrease on a national basis in 2019. This is a stark contrast to what we have seen with ACA plans in the past. While there is variation from market to market and some markets may see some price increases, overall there will be a net reduction in premiums. Gold plans are expected to dip by 2 percent, silver plans by 1 percent, and bronze plans by 0.3 percent.
The Senate Permanent Subcommittee on Investigations released a report this week critical of the maker of the opioid-overdose antidote Evzio for raising the price of the product by 600 percent since 2014. The report authors, Senators Rob Portman (R-OH) and Tom Carper (D-DE), found that the manufacturer encouraged doctors to sign paperwork indicating the drug was medically necessary making it eligible for reimbursement from Medicare and Medicaid. Government programs spent $142 million on the drug in the last four years even though there were cheaper alternatives for administering naloxone.
The Centers for Disease Control (CDC) issued a sweeping warning on romaine lettuce after 32 people in 11 states became sick in in E. coli outbreak. CDC took the unusual step of a broad warning as they were not able to accurately trace the source or region. We advise sticking to turkey, stuffing, potatoes and other vegetables and leave the salad to the side at your Thanksgiving dinner table.
“The Trump administration has reinstated permission for Kentucky to compel many of its low-income residents on Medicaid to work or prepare for a job, after a federal court had blocked the state’s ability to begin the requirements. Federal health officials announced Tuesday night that they had, for a second time, approved Kentucky’s plan to impose “community engagement” requirements as part of Medicaid, saying they could start in April, nine months after they originally were to have taken effect. In late June, days before the requirements were to have begun, Judge James E. Boasberg, of the U.S. District Court for the District of Columbia, essentially agreed with the critics. He ruled that Kentucky could not move ahead with its plan because federal health officials had not adequately considered the requirement’s impact on the program’s central purpose — providing medical assistance to a state’s citizens. In a statement Tuesday night, CMS spokesman Johnathan Monroe said that the agency “worked diligently to analyze and consider the comments received,” reaching the conclusion that Kentucky’s plan “is likely to promote the objectives of Medicaid.” A lengthy approval letter, dated Tuesday, to Kentucky officials makes clear that the version CMS just approved is substantially the same as the original with a few different nuances, such as a more explicit monitoring requirement about its effects.”
“Sen. Bernie Sanders (I-Vt.) and Rep. Ro Khanna (D-Calif.) on Tuesday unveiled a bill aimed at aggressively lowering drug prices by stripping monopolies from drug companies if their prices are deemed excessive. Sanders has long railed against drug companies for their prices, and this bill is one of the most far-reaching proposals aimed at lowering them. The bill would strip the monopoly from a company, regardless of any patents, and allow other companies to create cheaper generic versions of a drug if the price for that drug is higher than the median price in Canada, the United Kingdom, Germany, France and Japan. “No other country allows pharmaceutical companies to charge any price they want for any reason they want,” Sanders, who could run for president again in 2020, said in a statement. “The greed of the prescription drug industry is literally killing Americans and it has got to stop,” he added. Drug companies argue that other countries, with price controls, lack the innovation that happens in the United States. The bill does not have a clear path forward in the next two years, given that Republicans will still control the Senate.”
November 16, 2018
Things got a bit more interesting in the effort by the pharmaceutical industry to lower the industry’s contribution to closing the donut hole by $4 billion. That is a top priority for the industry to accomplish by the end of the year. However, we just learned that AARP and Patients for Affordable Drugs has launched a campaign to urge Congress not to change this policy. The campaign will have radio, television, digital and print ads running in congressional districts across the country.
There will also be a push from industry to seek a permanent repeal of the medical device tax imposed by the Affordable Care Act. A two-year delay of the tax was included in a continuing resolution (CR) that was passed in January. The House has already passed a permanent repeal of the tax, but the Senate has not yet taken up the bill. The medical device industry is seeking to have the Senate take action on the measure or have this included in whatever final agreement is reached on the outstanding tax issues such as passing the so-called tax extenders.
There are only three must-pass pieces of legislation during the lame duck session: 1. Completing the appropriations process for fiscal year (FY) 2019/passing another CR; 2. Completing the farm bill/passing an extension of the programs; and 3. Reauthorizing the National Flood Insurance Program/passing another extension. The list of additional legislation Congress is asked to pass is lengthy including the two issues mentioned previously. Lame duck sessions can take many twists and turns so it will be interesting to see how productive the session will be.
Representative Pramila Jayapal (D-WA) plans to introduce the House version of the Medicare for All legislation. This banner was previously carried by Representative Keith Ellison (D-MN) and Representative John Conyers (D-MI) before that. Representative Jayapal is seeking to better align the House version of the bill with the Senate version which has been introduced by Senator Bernie Sanders (D-VT).
“Rep. Frank Pallone Jr. (D-N.J.), who is slated to be the next chairman of a House committee overseeing drug prices, said Wednesday that his top priorities on the issue are allowing Medicare to negotiate prices and speeding the approval of cheaper generic drugs. Pallone, who is set to become chairman of the House Energy and Commerce Committee in January, pointed to President Trump’s support for those two policies in expressing hope for a bipartisan deal.I’ve always been an advocate for negotiated prices under Medicare, and as you know, President Trump says that he’s for that, so I think that’s an area where we can get agreement with the president,” Pallone told reporters. Trump has previously expressed support for allowing Medicare to negotiate drug prices, a top Democratic priority, but has since backed off the idea. Democrats are hoping to get him back on board, and they see drug prices as an area of possible bipartisan cooperation.”
“The Food and Drug Administration will restrict sales of most flavored e-cigarettes to age-restricted stores and pursue bans on menthol cigarettes and flavored cigars as it tries to control what Commissioner Scott Gottlieb describes as an “astonishing” surge in teen e-cigarette use that is reversing years of progress in fighting youth tobacco addiction. Gottlieb in a statement Thursday outlined a slew of policies and essentially threatened to pull products from the market if manufacturers do not follow them. He cited data from the Centers of Disease Control and Prevention’s National Youth Tobacco Survey, expected to be released in its entirety later Thursday, showing that 3.6 million middle and high school students currently use e-cigarettes.It could take weeks, if not months, for retailers to fully adjust to the flavored e-cigarette changes, Gottlieb told reporters Thursday. The FDA plans to advance rules on menthol cigarettes and flavored cigars next year, he added. He declined to give a time frame for when it could finalize a menthol ban but said the agency “should be able to move with some added efficiency.” In proposing new restrictions and regulations, Gottlieb breaks with President Donald Trump, who has repeatedly said his administration would work to rollback government oversight. Health and Human Services Secretary Alex Azar, in a statement, supported Gottlieb’s efforts.”
“Arkansas removed more than 12,000 people from its expanded Medicaid program over the past three months for not complying with a new work requirement, the state said Thursday. Another 6,000 are at risk of losing coverage by December if they don’t find work. The state Department of Human Services said more than 3,800 people lost their Medicaid coverage for not complying last month with the rule, which requires them to work 80 hours a month. Beneficiaries lose coverage if they don’t meet the requirement three months in a calendar year, and they can’t re-enroll until January. Nearly 8,500 people had lost coverage over the previous two months. The agency said another 6,000 people will lose coverage if they don’t meet the work requirement by the end of this month. Arkansas was the first state to enforce the requirement after the Trump administration allowed states to tie Medicaid coverage to work.”
November 9, 2018
The Food and Drug Administration (FDA) is expected to ban the sale of most flavored e-cigarettes in convenience stores and gas stations throughout the country. FDA is also looking to impose stricter age verification requirements for online sales. These actions are sparked by the alarming number of teens who are using e-cigarettes and may become smokers. Significant advertising of these products has made awareness of the products availability is high among teenagers.
You can read our complete election analysis of the election returns here, but one of the big winners coming out of election night was Medicaid expansion. Voters in three red states (Idaho, Utah, and Nebraska) approved ballot initiatives to expand Medicaid in their states. Also, candidates who support Medicaid expansion won in the states of Wisconsin, Kansas, and Maine. Maine is a bit complicated in that the voters in the state approved a ballot initiative in favor of Medicaid expansion but the outgoing governor had been fighting its implementation.
The incoming chairman of the House Ways and Means Committee Congressman Richie Neal (D-MA) was talking about bringing up a bill early in the session to better protect individuals with pre-existing health conditions. There is also speculation that drug pricing will also be an early focus of Chairman Neal and incoming Energy and Commerce Committee Chairman Frank Pallone (D-NJ). We are also expecting early action on further steps to address the opioid epidemic.
With Senator Hatch departing the Senate, there will be a new Chairman of the Senate Finance Committee. Speculation is that Senator Grassley (R-IA) will claim the gavel for the remaining two years of eligibility he has. However, no announcement has been made on Senator Grassley’s intention to Chair the Finance Committee or remain as Chairman of the Judiciary Committee.
With Veterans Day falling this weekend, we want to thank all who have served and are serving our country. Your service, sacrifices and commitment to our freedoms are greatly appreciated.
“Senate Majority Leader Mitch McConnell on Wednesday conceded that Democrat’s seizure of the House slams the door on Obamacare repeal efforts in Congress but held out the possibility of unspecified bipartisan fixes to shore up the law’s insurance markets. McConnell told reporters “there are serious problems with Obamacare, serious problems, that need to get fixed. … I think we are going to have to address that, now, on a bipartisan basis.” Democrats rode a wave of health care concerns to win back control of the House Tuesday night while Republicans tightened their grip on the Senate, a recipe for legislative gridlock unless lawmakers from both parties find a way to work together. President Donald Trump listed lowering drug prices as among the areas on which he believes he can work with Democrats next year. “Lowering the cost of prescription drugs, these are some of the things that the Democrats do want to work on,” Trump said. “I really do believe we’re going to be able to do that.” House Democratic Leader Nancy Pelosi, the presumptive next speaker, told reporters Wednesday that passing drug cost legislation is a “caffeinating issue” for her caucus and that she will push for a bill enabling direct government negotiations over drug prices.”
Medicaid is expanding in 3 red states- CNN November 7
“Voters in three deep-red states went around their elected representatives to approve Medicaid expansion at the ballot box Tuesday. Idaho, Nebraska and Utah residents all supported measures that extend Medicaid to residents with incomes up to 138% of the federal poverty line. The grassroots efforts will provide coverage to hundreds of thousands of people and could take effect as early as the spring. Democratic victories in several gubernatorial races also raise the likelihood of Medicaid expansion in additional states. Maine’s newly elected Democratic governor Janet Mills is expected to push through Medicaid expansion that was approved last year by voters in a first-of-its-kind ballot measure that was blocked by outgoing Republican Gov. Paul LePage. Mills will have the support of both state houses since Democrats also won control of Maine’s Senate. Voters in Kansas, meanwhile, elected Democratic candidate Laura Kelly, who has promised to support and sign an expansion bill next year. The Republican-controlled legislature approved broadening Medicaid there last year, but the bill was vetoed by then-Gov. Sam Brownback. And in Wisconsin, newly elected Democratic Governor Tony Evers may try to fully expand Medicaid, though he would face a tough battle with the Republican-controlled state legislature. The Badger State partially broadened Medicaid to cover those up to the poverty line and also recently received federal approval to impose work requirements and premiums on enrollees.”
“The Food and Drug Administration, alarmed by a huge increase in vaping among minors, is expected to impose severe restrictions on the sale of e-cigarette products throughout the United States — actions that will probably have a significant impact on an industry that has grown exponentially in recent years with little government oversight. As soon as next week, FDA Commissioner Scott Gottlieb is expected to announce a ban on the sale of most flavored e-cigarettes in tens of thousands of convenience stores and gas stations across the country, according to senior agency officials. The agency will also impose such rules as age-verification requirements for online sales, the officials say. Gottlieb also is expected to propose banning menthol in regular cigarettes. The agency has been collecting public comments on such a prohibition, which is a major goal of the public health community but is likely to be strongly opposed by the cigarette industry.”
November 2, 2018
It was a big week for Medicare payment systems with the Centers for Medicare and Medicaid Services (CMS) releasing three final payment rules. The physician fee schedule rule delivered a big win for telemedicine supporters by allowing reimbursement for physicians who virtually check in with patients and for remotely evaluating recorded images. The rule also opened up the Merit-based Incentive Payment System (MIPS) to audiologists, physical therapists, occupational therapists, qualified speech-language pathologists; psychologists, and dieticians. CMS also finalized changes for the next round of competitive bidding for durable medical equipment, as well as reimbursement rates for suppliers once the current round of competitive bidding ends Dec. 31 until the next round kicks in. The agency expects the gap between rounds of bidding will last until 2021. The rule also allows for new dialysis drugs to be reimbursed outside the end-stage renal disease (ESRD) bundled payment for their first two years on the market. CMS hopes this will spur innovation for new therapies. The home health payment rule is making it easier to monitor patients remotely which is another big win for telemedicine.
The judge in the case being brought against the Trump administration rule on short-term health plans that do not need to comply with the Affordable Care Act (ACA) had tough words for the plaintiffs in the suit. U.S. District Court Judge Richard Leon told the counsel for Association for Community Affiliated Plans that they are asking for “extraordinary relief” in their efforts to have the court stay the regulation. Meanwhile, the Washington state Insurance Commissioner, former Congressman Mike Kreidler, that the state will limit short-term plans sold in the state to three-months and not allow for renewals. The Kaiser Family Foundation also released a report this week showing that these ACA non-compliant plans could have premiums 54% lower than ACA complaint plans.
The Department of Health and Human Services (HHS) rolled out a rebranded Healthcare Cybersecurity and Communications Center to serve as a clearinghouse for cyber threat information. The new center replaces the much-criticized Healthcare Cybersecurity and Communications Integration Center (HCCIC). The announcement from HHS was met with criticism from Senate Committee on Health, Education, Labor and Pensions (HELP) Ranking Member Patty Murray (D-WA). Senator Murray believes HHS has dragged their feet in addressing cybersecurity threats.
CMS approved the waiver application from the state of Wisconsin to impose work requirements in its Medicaid program. The waiver also allows the state to impose new copays and premiums and will require beneficiaries to complete a health risk assessment about their behaviors. The waiver, however, stopped short of allowing the sate to test for drug use. Governor Scott Walker was touting the waiver as a big win for the state on the campaign trail.
“The Republican governor of Idaho gave advocates of expanding Medicaid a significant lift Tuesday, coming out in favor of the Obamacare policy just a week before voters in the state decide on its fate. The question of whether to grow the low-income health-care program to cover more people is on ballots in three deep-red states — Idaho, Utah and Nebraska — where conservative legislatures didn’t choose expansion. Outgoing Gov. C.L. “Butch” Otter, a conservative with an independent streak, announced his support and cut an ad for Idahoans for Healthcare, an organization advocating for expansion. “We cannot continue to let hardworking Idahoans go without healthcare. I’m proud that the citizens of Idaho have come up with a solution to solve this long-standing problem,” Otter said in a release. The ballot measure, Proposition 2, would cover up to 62,000 people and bring up to $400 million from federal coffers to the state. Otter also said it would keep rural hospitals and clinics open.”
“The Trump administration Wednesday granted Wisconsin’s request to impose work requirements in its Medicaid program — the first such approval for a state that has not fully expanded Medicaid. Wisconsin Gov. Scott Walker, a Republican who is battling to keep his job, hailed the move. Health care has become a central focus of the race, with Walker promising to protect those with pre-existing conditions even as he pushed for work requirements and supported a lawsuit that seeks to invalidate Obamacare. “We’re removing barriers to work to help Wisconsinites transition from government dependence to true independence!” he tweeted. The move also comes as the administration is defending two other waiver approvals in court. A US district judge voided federal approval of work requirements in Kentucky in June, just days before the mandate was set to begin. And three consumer groups filed suit in August to halt the requirement that’s already gone into effect in Arkansas, where more than 8,000 low-income residents lost their coverage in the first few months.”
“A bipartisan group of more than 290 lawmakers is throwing its support behind some of the drug industry’s least favorite proposals for bringing down the cost of insulin. Parts of the report — released Thursday by the Congressional Diabetes Caucus — read like a laundry list of the drug industry’s worst fears: It pitches everything from legislation requiring drug companies to disclose how they set their prices to legislation that dings drug makers who can’t prove that a new version of insulin is more effective than an older one. That effort was led by Rep. Diana DeGette (D-Colo.), a potential contender for the powerful chairmanship of the Energy and Commerce health subcommittee, should Democrats take over the House. But DeGette, who heads the caucus with Rep. Tom Reed (R-N.Y.), insists the report was a bipartisan effort. “This isn’t a red or blue, Republican or Democratic issue, it’s [a] life or death issue for millions of Americans,” DeGette told STAT in a statement. “We’re excited to work with our colleagues on both sides of the aisle to tackle this issue in the next Congress.” There’s a reason for that interest. The average list price for insulin nearly tripled between 2002 and 2013, according to the American Diabetes Association. More than 30 million Americans have some form of diabetes.”
October 26, 2018
The day after signing the opioids bill into law, President Trump headed over to the Humphrey Building to announce a new initiative in his efforts to tackle the cost of prescription drugs. The announcement was an advance notice of proposed rulemaking (ANPRM) issued by the Centers for Medicare and Medicaid Services (CMS) about launching an International Pricing Index (IPI) model for pricing Medicare Part B drugs biologicals. The ANPRM seeks comments on this new model for pricing drugs where hospitals and physicians in certain geographic areas would receive their drugs from vendors who would negotiate the price of the drugs. CMS would base reimbursements on the cost of the drugs on international markets. This new payment model would be evaluated over a 5-year period. CMS expects to issue a proposed rule to implement this new program in the spring of 2019 with the program beginning in 2020.
The Trump administration also announced another proposed rule to expand the use of health reimbursement accounts to buy individual health plans on the Affordable Care Act (ACA) individual health insurance market. Allowing these plans to reimburse the cost of health insurance gives these plans the same tax advantage of employer provided coverage. The Obama administration had disallowed this use of these plans to avoid adverse selection. The rule was issued jointly from the Departments of Treasury and Health and Human Services. The Trump administration claims there are protections in the rule to avoid adverse selection and this rule.
A senior Trump Administration official, Joe Grogan who is the Program Associate Director for healthcare at the Office of Management and Budget OMB), made news this week when he called on Congress to change the policy around the so-called donut hole in the Part D program. The Bipartisan Budget Act signed into law earlier this year changed the requirement that drug manufactures have to offer of discount of 70 percent to seniors who are in the donut hole. The previous requirement was to discount the prices by 50 percent. This change in policy has come under great scrutiny because the Congressional Budget Office (CBO) initial scored this policy change as saving $7.7 billion over 10 years. However, CBO learned that they missed some data when preparing this score and now estimate the provision would save $11.7 over the ten-year period. The pharmaceutical industry has been pushing Congress to get the $4 billion back. Grogan did not specify how Congress should change the program but stated “violence was done” to the Medicare Part D program by the Bipartisan Budget Act.
Patient advocacy groups today will ask a judge in the D.C. District Court to suspend the final rule the Trump administration issued on short-term health plans. The petitioners believe this rule will siphon healthy individuals out of the ACA-compliant plans making those plans more costly.
Ways and Means Health Subcommittee Staff Director Emily Murry has departed Capitol Hill after a distinguished ten-year Hill career to pursue other opportunities. We want to wish Emily the best as she transitions in her career.
Cold and flu season starts now – to protect yourself and others, make sure to get your flu shot and keep your hands extra clean!
“The Trump administration is throwing open the door to states to make major changes to their Obamacare markets. States can now apply for newly broadened waivers to create alternatives to the Affordable Care Act program, the Centers for Medicare and Medicaid Services said Monday. They could use this enhanced power to determine who gets financial assistance to pay premiums and to change what types of coverage are prioritized in the individual market. The announcement comes just two weeks ahead of the midterm elections. Health care ranks as one of Americans’ top priorities, prompting candidates to attack each other on who would do more to reduce costs and protect those with pre-existing conditions. The move will increase affordable insurance options, while retaining protections for those with pre-existing conditions, said CMS Administrator Seema Verma. “The guidance that was in place before was really too restrictive and was thwarting innovation,” Verma said. “We feel like this version provides that level of flexibility.” She added that the administration’s goal was “to get states out from under Obamacare’s onerous rules.” Health policy experts, however, immediately countered that it could leave low-income, older or sicker residents with fewer choices and higher costs while favoring the young and healthy.”
“Medical treatment will be more widely available to opioid abusers while mailing illicit drugs will be more difficult under a measure to fight drug addiction that was signed into law on Wednesday by U.S. President Donald Trump. Trump signed the rare bipartisan package passed by Congress earlier this month to tackle a problem that led to a record 72,000 drug overdose deaths in 2017. The legislation expands access to substance abuse treatment in Medicaid, the government health insurance program for the poor and disabled; cracks down on mailed shipments of illicit drugs such as fentanyl, a synthetic opioid far more powerful than heroin; and provides a host of new federal grants to address the crisis.”
“President Donald Trump outlined a plan Thursday he said would allow Medicare to lower drug prices for its Part B coverage and end this “rigged system” that allows other countries to pay less than the U.S. for the same drugs. Under the administration’s proposal, the Department of Health and Human Services would permit Medicare to create a new payment model that would bring drug prices in line with what other nations pay. HHS estimates $17 billion in program savings over five years, it said in a press release. The agency is trying to issue a formal rule early next year with the new payment model taking effect in 2020, HHS said.”
“Altria Group, responding to federal regulators’ worries about rising rates of teen vaping and the possible health implications, said Thursday it would stop selling its pod-based e-cigarettes, at least temporarily. The tobacco manufacturer, which also makes Marlboro cigarettes, said it would not put the vaping products back on the market until they get federal clearance or “the youth issue is otherwise addressed.” That means a halt in sales of MarkTen Elite and MarkTen pod-based products. Those pods are essentially cartridges that hold liquids that are turned into vapor before being inhaled. Such pods have become increasingly popular because of their portability and ease of use. The vaping products currently do not need a Food and Drug Administration sign-off if they were on the market before August 2016. Altria’s move comes at a pivotal moment as the FDA struggles to rein in what Commissioner Scott Gottlieb has declared “an epidemic” of underage use of e-cigarettes.”
October 19, 2018
The Centers for Medicare and Medicaid Services (CMS) released a proposed rule that will require drug companies to disclose the list price of the drug in any direct-to-consumer television advertising. The rule would apply to all therapies with a list price greater than $35 for a month’s supply of the drug which should cover virtually all drugs that are marketed on television. The announcement of the proposed rule came on the heels of an announcement by PhRMA, the trade association of drug companies, of a voluntary initiative where drug companies would steer consumers to a website to learn more about drug pricing. PhRMA has suggested it will challenge the proposed rule in the courts around First Amendment issues.
CMS also announced the hiring of Mary Mayhew as the new Deputy Administrator and Director of the Center for Medicaid and CHIP. Mayhew previously served as Commissioner of the state Department of Health and Human Services in Maine. Maine has submitted a waiver application to CMS to institute a work requirement in the state’s Medicaid program. Mayhew has stated that she will recuse herself from any Maine-related issues at CMS.
Kaiser Family Foundation released a study on Tuesday about the growth in Medicare Advantage plans. There will be 417 more plans available next year putting the total number of plans available to over 2,700 plans. There have not been that number of plans available since 2009. The Affordable Care Act pulled back significantly on reimbursements to Medicare Advantage plans so plans dropped starting in 2010. Devoted Health, a startup health insurance company, announced it has raised $300 million from investors. Devoted offers Medicare Advantage plans in 8 Florida counties and has plans to expand its coverage. Devoted has ties to Todd Park and Bob Kocher who were both senior officials in the Obama Administration.
We are hearing the President will sign the opioids bill passed by Congress very soon. There were lots of provisions in the bill Members of Congress are touting after its passage, so the signing ceremony will be welcome news.
“The Trump administration on Monday moved to require drug makers to disclose prices in consumer ads, just hours after branding a pharmaceutical industry transparency plan as inadequate. HHS said its proposed rule fulfilled another prong of the president’s blueprint to address pharmaceutical costs and would help Americans make more informed decisions that could lower out-of-pocket costs and those of government health programs like Medicare and Medicaid. The move came with polls showing significant voter outrage about drug costs, which also are comprising an ever larger share of the federal budget. The agency said research shows added price transparency will discourage manufacturers from raising prices. The proposed rule would require manufacturers to list a product’s monthly wholesale price or the cost for a typical course of treatment if it is greater than $35 for 30 days. The information would have to appear in text large enough for people to read. The ads also would have to include a statement that patients with health insurance may pay a different sum. The idea is meeting strong resistance from the drug lobby PhRMA, which argues disclosure of list prices without additional context is misleading to consumers, since most have insurance that negotiates lower costs and charges the consumer just a fraction of a drug’s list price. The industry worries disclosure of the higher list prices could discourage patients from seeking needed medical care.”
“Senate Majority Leader Mitch McConnell (R-Ky.) said Wednesday that Republicans may try again to repeal the Affordable Care Act after the November midterm elections, reviving an issue that polls show has swung sharply in the Democrats’ favor. In an interview with Reuters, McConnell said that his party’s failure last year to repeal the health-care law, also known as Obamacare, was “the one disappointment of this Congress from a Republican point of view.” “If we had the votes to completely start over, we’d do it. But that depends on what happens in a couple weeks. . . We’re not satisfied with the way Obamacare is working,” McConnell said. Republicans are optimistic about their chances of maintaining control of the Senate next month, while polls suggest that a Democratic takeover of the House is increasingly likely. Polls show that health care is a top issue for voters, and many GOP candidates have begun campaigning on a longtime Democratic theme — protecting people with preexisting medical conditions — despite the fact that congressional Republicans have voted time and again to repeal the Affordable Care Act, which provides those protections.”
“Virginia is set to start accepting enrollment applications from the roughly 400,000 low-income adults newly eligible for Medicaid. Gov. Ralph Northam announced Thursday that the state would begin accepting applications on Nov. 1 for new coverage that will begin at the start of 2019. State lawmakers voted to expand Medicaid earlier this year, joining a majority of other states that have already expanded publicly funded health care to low-income adults. Medicaid expansion is a key part of former President Barack Obama’s signature health care law. Northam said the federal government has recently signed off on Virginia’s request to expand its Medicaid program.”
“New York state officials are considering blocking parts of the $68 billion merger of drugstore store chain CVS Health Corp. and Aetna Inc., jeopardizing billions of dollars in insurance premiums for Aetna. CVS and Aetna won approval from the U.S. Justice Department on Oct. 10, contingent on Aetna divesting its Medicare Part D business, which covers prescription drugs for seniors. But the deal still needs to pass through state regulatory bodies. At a public hearing in Manhattan on Thursday, Maria Vullo, superintendent of the state Department of Financial Services, said her agency might block CVS’s merger with Aetna’s New York unit. She called U.S. approval of the overall deal “myopic” and repeatedly asked CVS and Aetna representatives for written evidence that they would deliver on promises to lower prices.”
October 12, 2018
The Trump Administration is considering taking bolder actions against e-cigarettes. Health and Human Services Secretary (HHS) Alex Azar and Food and Drug Administration (FDA) Commissioner Scott Gottlieb penned an op-ed in the Washington Post stating that they are “actively reconsidering our policy” on which devices can be on the market without submitting a new pre-market application to the FDA. This follows a visit by FDA inspectors to the headquarters of Juul Labs a leading manufacturer of e-cigarettes and took over 1,000 pages of documents about their sales and marketing. Juul offers e-cigarettes in flavors such as mango and cucumber which are appealing to underage users. Youth vaping jumped 75 percent last year. There is speculation that FDA may ban flavored e-cigarettes.
Even though the language seeking to overturn the privacy protections afforded from 42 CFR Part 2 did not make it into the final opioid package passed by Congress, there is speculation that Congress will revisit that issue soon. Congressman Markwayne Mullin (R-OK) has stated that he wants the House to pass his bill overturning the restriction on including addiction from a patient’s medical records. Senator Alexander (R-TN) who Chairs the Health, Education, Labor and Pensions (HELP) Committee has also expressed an interest in revisiting the issue.
FDA approved a new hearing aid from Bose that patients can fit, program and control on their own. Last year Congress approved a measure allowing FDA to approve over-the-counter hearing aids to be sold. FDA has not yet issued regulations implementing the law so this approval comes with the condition that the device must comply with federal and state laws regarding the sale of hearing aids, including state laws that require hearing aids be acquired from a licensed hearing aid dispenser.
The Senate rejected a Congressional Review Act (CRA) resolution that sought to overturn the Trump administration regulation on short-term health plans. The resolution failed on a vote of 50-50 with all Democratic Senators voting in favor as did Senator Collins (R-ME). The final regulation issued by the Trump administration defined short-term health plans that do not need to comply with the Affordable Care Act as being one year in duration and eligible for three renewals.
The merger between CVS and Aetna was cleared by the Justice Department this week. The approval comes with a condition that Aetna must sell off its Medicare Part D plans. Last month the Justice Department approved the sale of one of CVS’ biggest rivals Express Scripts to Cigna.
We hope our friends and family in the Green Mountain state enjoy their National Vermont Day today. After all, Vermont was the first state to join the country after the 13 original colonies.
“A long-shot bid to derail the Trump administration’s expansion of short-term health plans died in the Senate on Wednesday, even with Sen. Susan Collins providing the lone Republican vote for the resolution. The Senate vote ended in a 50-50 tie, falling short of the majority needed to pass the measure reversing new regulations allowing insurers to sell skimpy health plans outside the Obamacare markets for up to a year, rather than the previous limit of three months. The Trump administration has touted the expanded plans as a cheaper alternative to Obamacare, but Democrats and health groups have warned it would undermine the Obamacare market. In recent weeks, Democrats have tried to tie the short-term health plans to broader warnings about GOP efforts to gut protections for pre-existing conditions.”
“The Justice Department’s approval of the $69 billion merger between CVS Health and Aetna on Wednesday caps a wave of consolidation among giant health care players that could leave American consumers with less control over their medical care and prescription drugs. The approval marks the close of an era, during which powerful pharmacy benefit managers brokered drug prices among pharmaceutical companies, insurers and employers. But a combined CVS-Aetna may be even more formidable. As the last major free-standing pharmacy manager, CVS Health had revenues of about $185 billion last year, and provided prescription plans to roughly 94 million customers. Aetna, one of the nation’s largest insurers with about $60 billion in revenue last year, covers 22 million people in its health plans. The two companies say that they will be better able to coordinate care for consumers as the mergers help tighten cost controls. Larry J. Merlo, the chief executive of CVS Health, said in a statement that the approval “is an important step toward bringing together the strengths and capabilities of our two companies to improve the consumer health care experience.” But critics worry that consumers could end up with far fewer options and higher expenses. “This type of consolidation in a market already dominated by a few, powerful players present the very real possibility of reduced competition that harms consumer choice and quality,” George Slover, senior policy counsel for Consumers Union, an advocacy group, said in a statement. The consumer organization had opposed the Aetna-CVS merger, arguing that people enrolled in Aetna health plans could be forced to seek care at CVS retail clinics, and that those who were not insured by Aetna could pay higher prices for drugs than those who were.”
“President Donald Trump signed two bills at the White House on Wednesday aimed at lowering pharmaceutical drug prices by promoting greater disclosure in drug pricing. The two bills the president signed — the Know the Lowest Price Act and the Patients’ Right to Know Drug Prices Act — are meant to prevent “gag clauses” in agreements between pharmacies and pharmacy benefit managers, the middlemen who administer prescription drug programs for insurance companies, which pharmacists say kept them from disclosing cheaper drug options to consumers. Under the new legislation, pharmacists will be allowed, though not required, to tell patients about lower-cost options.”
“The average price tag for the most popular level of insurance sold in the Affordable Care Act’s federal marketplaces is dropping slightly, the first time the rates have stopped going up since the health plans were created a half-dozen years ago. In the 39 states that rely on HealthCare.gov, the monthly premium is dipping by 1.5 percent for 2019 in a tier of coverage that forms the basis for the ACA’s federal insurance subsidies, according to federal figures released Tuesday. The figures also show that, after several years of defections, some insurers are returning to sell ACA health plans, and fewer consumers around the country will have only one insurance company in their marketplace. In issuing this new portrait of the marketplaces on the cusp of the Nov. 1 yearly sign-up period, administration officials did an about-face from President Trump’s declarations since his campaign that the ACA was “dead” and its insurance exchanges were collapsing — a refrain popular among Republicans. Seema Verma, administrator of the Department of Health and Human Service’s Centers for Medicare and Medicaid Services, credited the administration for improving the affordability and supply of ACA coverage. She said the Trump administration’s recent policies have stabilized the marketplaces, and she focused on a rule change to make it easier to rely on short-term health plans with relatively low prices that lack popular consumer protections.”
October 5, 2018
We heard lots of cheers around the Capitol as the Senate passed the comprehensive opioid bill, H.R. 6, by an overwhelming vote of 99 to 1. The bill includes provisions from many individual bills introduced by Senators and Members of the House. Senator Portman (R-OH) touted a provision based upon a bill (S. 3057) he introduced to require the Postal Service to inspect international shipments to prevent the illegal importation of fentanyl. Another provision authored by Senators Klobuchar (D-MN) and Rubio (R-FL) creates an anti-kickback statute to prevent patient brokering where individuals receive compensation for referring patients to treatment facilities. We expect the President to sign this bill into law quickly.
The Substance Abuse and Mental Health Services Administration (SAMHSA) is seeing a shake-up in its leadership. Paolo del Vecchio who has run SAMHSA’s mental health center since 2012 is being reassigned to lead the office of management, technology and operations. Greg Goldstein who currently leads the office is departing the agency.
The Administrator of the Centers for Medicare and Medicaid Services (CMS) Seema Verma touted the fact that the insurance marketplaces under the Affordable Care Act (ACA) are looking healthier. Administrator Verma stated that many of the markets are seeing more choices of insurance providers and the prices of the policies sold in the exchanges are only expected to rise by less than 5 percent on average.
Memorial Sloan Kettering Cancer Center has come under scrutiny over some potential conflicts of interest of its executives. The Chief Executive, Dr. Craig Thompson, announced he was stepping down from two corporate boards of healthcare companies for which he received significant compensation. A Vice President, Dr. Gregory Raskin, is turning over $1.4 million in compensation he earned while serving on a board of a biotech company.
“The Senate passed the final version of a sweeping opioids package Wednesday afternoon and will send it to the White House just in time for lawmakers to campaign on the issue before the November midterm elections. The vote was 98 to 1, with only Utah Sen. Mike Lee (R) opposing it. The bill unites dozens of smaller proposals sponsored by hundreds of lawmakers, many of whom face tough reelection fights. It creates, expands and reauthorizes programs and policies across almost every federal agency, aiming to address different aspects of the opioid epidemic, including prevention, treatment and recovery. It is one of Congress’s most significant legislative achievements this year, a rare bipartisan response to a growing public health crisis that resulted in 72,000 drug-overdose deaths last year. It marks a moment of bipartisan accomplishment at an especially rancorous time on Capitol Hill as senators debate Brett M. Kavanaugh’s nomination to the Supreme Court.”
“If your employer is sticking you with a bigger share of the medical bill before health insurance kicks in, you may have to get used to it. More companies are making workers pay an annual deductible or increasing the amount they must spend before insurance starts covering most care, according to a survey released Wednesday by the Kaiser Family Foundation. Annual deductibles for single coverage have now climbed about eight times as fast as wages over the last decade. That means that those who use the health care system are pouring more of their take-home pay into medical bills even though they have coverage. Health benefits experts say they see few signs that these rising deductibles will level off anytime soon for employer-sponsored benefits. “At some point they have to come down to Earth, we just don’t know what point that is,” said Matthew Rae, a Kaiser senior health policy analyst. Employer-sponsored coverage is the most common form of health insurance in the United States, covering about 152 million people, according to Kaiser. The nonprofit found that the annual cost or premium for family coverage rose 5 percent this year to $19,616, on average, while single coverage premiums climbed 3 percent to $6,896. That continued a trend toward moderate increases over the past several years.”
“The Food and Drug Administration conducted a surprise inspection of the headquarters of the e-cigarette maker Juul Labs last Friday, carting away more than a thousand documents it said were related to the company’s sales and marketing practices. The move, announced on Tuesday, was seen as an attempt to ratchet up pressure on the company, which controls 72 percent of the e-cigarette market in the United States and whose products have become popular in high schools. The F.D.A. said it was particularly interested in whether Juul deliberately targeted minors as consumers. “The new and highly disturbing data we have on youth use demonstrates plainly that e-cigarettes are creating an epidemic of regular nicotine use among teens,” the F.D.A. said in a statement. “It is vital that we take action to understand and address the particular appeal of, and ease of access to, these products among kids.” F.D.A. officials described the surprise inspection as a follow-up to a request the agency made for Juul’s research and marketing data in April. Kevin Burns, Juul’s chief executive officer, said the company had already handed over more than 50,000 pages of internal documents to the F.D.A. in response to that request.”
“Rep. Pete Sessions (R-Texas) on Tuesday introduced a resolution intended to protect people with pre-existing conditions, illustrating the lengths vulnerable Republicans are going to try to show they favor those protections. The resolution from Sessions, who is facing a close reelection race against Democrat Colin Allred, is nonbinding, but expresses the opinion of the House that pre-existing conditions should be protected. In a statement, Sessions said that “Obamacare has failed the American people,” but he added that he does want to preserve pre-existing condition protections. “To cement these protections, I proudly introduced this resolution to ensure that patients with pre-existing conditions are protected from the erroneously high costs and the limited options they are experiencing now,” Sessions said. The resolution does not spell out the details of how pre-existing conditions would be protected in the absence of ObamaCare.”
House and Senate negotiators concluded a brisk negotiation over the final version of a legislative package to help in the fight against the opioid epidemic. On Tuesday night, the House filed an amendment to the Senate-passed version of H.R. 6 – the SUPPORT for Patients and Communities Act. The final version of the bill did not include the House-passed language that would have allowed health care providers to include information about addiction treatment in the patient’s health records without their consent. Nevertheless, the bill did include language directing the Secretary of Health and Human Services (HHS) to develop best practices for including information about a patient’s opioid use disorder in their medical record with their consent. The measure includes many consensus measures to improve Medicaid and Medicare coverage for opioid treatment services. The bill also allows the Food and Drug Administration (FDA) to require better safety protocols for packaging of opioids and to create expedited pathways for the creation of non-addictive pain treatment medications. State Targeted Response Grants are authorized at $500 million per year through 2021. The House passed the bill earlier today, and we expect the Senate to pass it next week.
The House passed two bills aimed at the so-called “gag clauses” in pharmacy contracts that prohibit pharmacists of informing patients about the cheapest available drugs. One bill, S. 2553, would prohibit Medicare Part D and Medicare Advantage plans from including provisions in their contracts prohibiting pharmacists from telling patients that the retail cost of the drug is lower than their copayment. The second bill, S. 2554, would include similar prohibitions in employer provided and individual market plans. The President is expected to sign both bills as he has called for these policies in his efforts to lower prescription drug costs.
The House also passed the reauthorization of the Pandemic and All-Hazards Preparedness and Advancing Innovation Act. The measure authorizes $7.1 billion for Project Bioshield which is a fund used to buy medical countermeasures to respond to the outbreak of diseases such as Zika and Ebola. The Senate Committee on Health, Education, Labor and Pensions (HELP) reported a version of this legislation earlier this year. Given that the House bill passed on a voice vote, it is possible the Senate may call up the House-passed bill to move quickly on this reauthorization.
California Governor Jerry Brown signed legislation that bans the sale of short-term health insurance policies in the state. California is the first state to take such an action. This legislation is in reaction to the regulation finalized by the Trump Administration defining these short-term plans that do not need to comply with the Affordable Care Act (ACA) as being a year in duration and are eligible for three renewals. The Trump Administration has been touting this rule as a way to help lower healthcare costs. It will be interesting to see if more states follow California’s lead on these non-ACA compliant plans.
Today marks both the Hug a Vegetarian Day and the Drink Beer Day. We hope you enjoy your hugs and beers responsibly.
AP investigation: Drug prices going up despite Trump promise- Associated Press (September 24)
“President Donald Trump made reducing drug prices a key promise during his election campaign, repeatedly accusing drugmakers of “getting away with murder.” At the end of May, he promised that drug companies would be announcing “massive” voluntary drug price cuts within two weeks. That hasn’t happened, and an Associated Press analysis of brand-name prescription drug prices shows it’s been business as usual for drugmakers, with far more price hikes than cuts. The number of increases slowed somewhat and were not quite as steep as in past years, the AP found.”
Lawmakers unveil massive bipartisan bill aimed at fighting opioid crisis- The Hill (September 25)
“Bipartisan congressional leaders in both chambers on Tuesday night unveiled a massive bill aimed at fighting the epidemic of opioid abuse in the United States, capping months of work. Fighting the crisis has been an area of bipartisan cooperation this year amid many fierce partisan battles raging with more publicity. The 660-page bill takes a wide variety of actions aimed at fighting the crisis. It lifts some limits on Medicaid paying for care at treatment facilities, undoing part of a decades-old restriction that many lawmakers called outdated. It cracks down on illicit opioids being imported through the mail from other countries, fueling the epidemic. It encourages the development of nonaddictive painkillers as an alternative to opioids. “Once signed into law, this legislation sends help to our communities fighting on the front lines of the crisis and to the millions of families affected by opioid use disorders,” the chairs and ranking members in both chambers who worked on the measure said in a joint statement after unveiling the text late Tuesday night.”
Trump administration defends Medicaid work requirements- The Hill (September 27)
“A top health official in the Trump administration defended Medicaid work requirements Thursday, arguing that its intent isn’t to expel people from the program.”Community engagement requirements are not some subversive attempt to just kick people off of Medicaid,” Seema Verma, head of the Centers for Medicare and Medicaid Services, said in a speech in Washington, D.C. “Instead, their aim is to put beneficiaries in control with the right incentives to live healthier, independent lives.” More than 4,300 people lost their Medicaid coverage in Arkansas this month for not adhering to the new rules. Verma’s comments come as the administration defends itself against a lawsuit targeting its approval of the Arkansas work requirements. Hearings for the case, filed by the National Health Law Program, have not yet been scheduled. Verma referenced the Arkansas program in her remarks, repeating an assertion from the state’s governor that it helped 1,000 people gain employment. “Imagine the impact that this has had on the lives of those individuals and their families,” Verma said. Arkansas became the first state, in Medicaid’s 53-year history, to strip coverage from beneficiaries for not meeting work requirements. The Trump administration has also approved work requirements in Indiana and New Hampshire that are slated to take effect next year. A similar program in Kentucky was struck down this summer by a federal judge.”
Obamacare is about to get a bit cheaper for lots of people- CNN (September 28)
“It will likely cost a little less to buy the benchmark Obamacare plan next year. The rate could drop for the first time since the Affordable Care Act exchanges opened in 2014. The premium for the benchmark silver policy on the federal exchange is expected to decline by 2% for 2019, Health Secretary Alex Azar said Thursday. The predicted decline for next year comes after a 37% spike for this year’s benchmark silver plan, upon which premium subsidies are based. The number of insurers on the federal exchange also will grow for the first time since 2015, Azar said. Over the past two years, 44% of carriers have dropped out of the program. The Centers for Medicare & Medicaid Services, which administers Obamacare, typically releases a more detailed look at the upcoming year’s premiums and insurer participation in late October. Open enrollment begins November 1 and runs through December 15 in most states. Obamacare’s fortunes have taken a notable turn for the better this year. In 2017, insurers were fleeing the marketplace or hiking rates to combat the GOP-fueled uncertainty surrounding the Affordable Care Act. The new stability isn’t that surprising to those who watch the industry closely. Many insurers are breaking even or have started making a profit in the individual market, and the threat of Congress repealing the law has waned.”
This was a big week in fight against the opioid epidemic. The Senate passed their version of comprehensive legislation in the fight against opioid abuse by a vote of 99 to 1. If you drew a Venn diagram of the House and Senate passed bills there would be a fair amount of overlap. Nevertheless, there are some policy divides the two chambers will need to resolve. Perhaps the most significant is one that deals with privacy as the House tackles the prohibition in 42 USC Part 2 to allow substance abuse records to be part of a patient’s medical records. The rationale for lifting the ban is that medical records are now protected by the Health Insurance Portability and Accountability Act (HIPAA) which was not in place when 42 USC Part 2 was put in place. Privacy and other advocates are concerned about the vulnerability of patients if the protections in 42 USC Part 2 are lifted. We are expecting House and Senate negotiators to resolve their differences quickly and possibly file a conference report next week.
Another development this week was the announcement by the Trump Administration that they were awarding nearly $1.5 billion in funding to combat the opioid crisis. The Substance Abuse and Mental Health Services Administration (SAMHSA) announced the awarding of $930 million in State Opioid Response (SOR) grants. The Centers for Disease Control (CDC) announced the awarding of $194 million to support states and territories to assist with the collection of data. The Health Resources and Services Administration (HRSA) awarded $396 million which will be used to fund community health centers in their fight against opioid abuse. $50 million of those funds is being reserved for rural organizations that can assist in this fight.
The Senate passed the second “minibus” appropriations bill which includes the Labor, Health and Human Services, and Education (Labor-HHS) appropriations bill by a vote of 93 to 7. This bill also includes the Department of Defense appropriations bill and a continuing resolution (CR). While President Trump has made some noise on social media about the appropriations bill and the lack of funding for the border wall, we still expect the House to pass the bill next week and the President to sign it into law. It is interesting to note that this bill includes the rescission of $7 billion in unspent Children’s Health Insurance Program (CHIP) funding that the White House proposed in its rescission package this spring.
The Senate also passed this week a bill that would ban the so-called “gag clauses” placed on pharmacists that prohibit them from informing consumers when it is cheaper to buy a drug without their insurance coverage. This bill also passed on an overwhelming majority of 98 to 2. If the House is also able to pass this bill next week, it will mark a big victory for President Trump who has been pushing this policy in his fight against prescription drug costs.
The Justice Department cleared the merger of Cigna and Express Scripts this week. The expectation is the deal will be finalized before the end of the year even though there are still some state approvals necessary before the deal can be finalized.
The Chief Actuary for the Center for Medicare and Medicaid Services (CMS) released their report on Medicaid spending this week projecting total Medicaid spending to be close to $600 billion in 2017. The report projects Medicaid spending to top $1 trillion by 2026 with the growth in spending exceeding the rate of economic growth. This program has roughly doubled in size since 2008.
Senate passes bipartisan opioid package- CNN September 17
“In a rare bipartisan move, the Senate on Monday passed legislation aimed at combating the opioid epidemic that had overwhelming support from both sides of the aisle. The package is made up of provisions from five Senate committees and more than 70 lawmakers, and comes after the House passed a similar bill in June. This legislation was sponsored by Tennessee Republican Sen. Lamar Alexander, chairman of the Senate Health Committee, and includes several initiatives that work to curb the opioid crisis. In a statement Monday, Alexander said he is “already working to combine the Senate and House-passed bills into an even stronger law to fight the nation’s worst public health crisis, and there is a bipartisan sense of urgency to send the bill to the President quickly.” The package has provisions that would give the US Food and Drug Administration the authority to require specific packaging for opioids, as well as a push for research on non-addictive pain killers, according to a previous statement from Alexander. In 2016, more than 63,600 people died from an overdose in the United States — and 42,249 of those deaths involved an opioid, according to the Centers for Disease Control and Prevention. The legislation also includes the “STOP Act,” which would attempt to help stop the flow of illegal drugs coming into the United States.”
“Federal regulators on Monday have approved health insurer Cigna’s $52 billion acquisition of drug benefits manager Express Scripts, a mega deal that’s the latest evidence of health care giants bulking up, the companies said in an announcement Monday. The combination represents a major reshuffling of the health care industry as companies try to constrain costs and gird for the long-expected entrance of Amazon into the sector. The Justice Department reportedly is also close to approving CVS Health’s blockbuster acquisition of Aetna, which would create one of the country’s biggest health care companies. The looming approval of the deals comes two years after Obama administration regulators blocked a major proposed consolidation in the health insurance industry over concerns about diminished competition. DOJ successfully sued in 2016 to halt Anthem’s proposed acquisition of Cigna and Aetna’s merger with Humana”
“A bipartisan group of senators is unveiling a draft measure to crack down on surprise medical bills, which they say have plagued patients with massive unexpected charges for care. The measure would prevent a health care provider that is outside of a patient’s insurance network from charging additional costs for emergency services to patients beyond the amount usually allowed under their insurance plan. The insurer, not the patient, would have to pay additional charges, which are limited under the proposal. The bill targets situations like one that received a flood of national attention last month, when NPR and Kaiser Health News reported on a high school teacher who was charged $109,000 by the hospital that cared for his heart attack, even after his insurance had already paid $56,000.”
“The Trump administration is awarding more than $1 billion in grants to help states confront the opioid epidemic, with most of the money going to expand access to treatment and recovery services. Officials say more than $900 million comes from a grant program Congress approved this spring as part of a budget bill. Lawmakers are working on another bipartisan bill to address the opioid problem and hope to have final legislation to President Donald Trump by year’s end.”
“Lawmakers are considering adding a provision easing costs on drug companies to an opioid package currently being negotiated. The powerful pharmaceutical industry has been pushing for months to roll back a provision from February’s budget deal that shifted more costs onto drug companies, and they sense they have a chance to attach the change to the bipartisan opioid package currently moving through Congress. Democratic aides said Republicans are pushing to add the change at the behest of drug companies. Senate Democrats have not taken a clear position. Henry Connelly, a spokesman for House Democratic Leader Nancy Pelosi (Calif.) said Thursday evening, though, that Pelosi opposes the move. “The way Republicans are writing this, Big Pharma will get two or three times more money than the opioids crisis,” Connelly said. “Leader Pelosi opposes this Republican attempt to hijack a bipartisan effort on opioids funding to ram through a multi-billion dollar handout to Big Pharma.” Drug pricing advocates are up in arms at the possibility of a change favorable to pharmaceutical companies making it into a package aimed at fighting the opioid epidemic.”
September 14, 2018
The Labor-Health and Human Services-Education (Labor-HHS) appropriations bill conference report was filed last night. The bill also includes the Defense Appropriations bill and a continuing resolution (CR) that funds the portions of the federal government not covered by a regular appropriations bill until December 7th. Some healthcare highlights in the bill include: $2 billion increase for the National Institutes of Health (NIH); $3.8 billion to combat the opioid crisis including $1.5 in funding for states; and a $584 million increase for the Substance Abuse and Mental Health Services Administration (SAMHSA). Of note the bill does not include the bipartisan amendment offered by Senators Grassley (R-IA) and Durbin (D-IL) to provide funding for the Secretary of HHS to develop regulations to require pharmaceutical companies to disclose their price in direct-to-consumer advertising. The amendment had passed the Senate on a voice vote. With the passage of this bill, 75% of the government will be funded by regular appropriations bill and only 25% will be funded by the CR.
The Census Bureau released their community survey this week. The survey revealed that the number of uninsured in the country remained static in 2017 at 8.8% or 28.5 million individuals. Those numbers are not statistically different from the figures for 2016. The uninsured rate dipped in three states and rose in fourteen states but overall the numbers remained static on a national basis.
The House took the first step towards taking another swipe at the Affordable Care Act (ACA). The House passed a rule on Thursday to provide for consideration of a bill that will increase the definition of “full-time employee” from 30 to 40 hours, suspend the penalty for the employer mandate from 2015-2018, repeal the tanning tax, and delay the so-called Cadillac tax for an additional year. The House did not begin debate on the measure before departing for the week and is expected to consider it during the last week in September.
Apple announced this week that its new Apple Watch 4 includes an App that monitors your heart rhythm and notify you if you have an irregular heartbeat. This App is the first ever over-the-counter electrocardiogram (ECG). There are other products in the market, but this is the first one that consumers can use with a doctor’s review.
Former Veterans Affairs (VA) Secretary Shulkin has landed at Sanford Health the largest non-profit rural health system in the country. Shulkin will be serving as Sanford’s Chief Innovation Officer but he will not be relocating to the company’s headquarters in Sioux Falls, SD.
The Senate delayed consideration of the House passed opioid bill (H.R. 6) until Monday. We are hearing that House and Senate negotiators have already begun to try and iron out the differences between the House-passed version and Senator Alexander’s (R-TN) substitute amendment with hopes of sending something to the President before the election.
“America’s uninsured rate held essentially steady from 2016 to 2017, according to U.S. Census Bureau figures published on Wednesday, the first year this decade that the nation did not make progress in reducing the ranks of those without health insurance. The finding suggests America’s recent success in lowering its uninsured population has plateaued, with potential implications for policymaking and the fate of the U.S. health care system. “There has been a stall in the progress of reducing the number of uninsured Americans,” said Laura Skopec, a health care expert at the Urban Institute, a centrist think-tank. In 2016, 8.8 percent of the American population — or 28.1 million people — did not have health insurance. In 2017, the number of those without health care rose by about 400,000 people to 28.5 million while the rate of the uninsured did not change, according to Census Bureau figures. The increase was not statistically significant. The reversal comes after nearly a decade of progress in bolstering the number of Americans with health care. The number of uninsured Americans fell steadily from 2010 until 2016, decreasing by at least 0.3 percentage points every year over that period. From 2010 to 2016, the uninsured rate fell dramatically — nearly in half — as tens of millions of more people were signed up for health insurance under the Affordable Care Act signed by President Obama in 2010.”
“House Republicans on Thursday blocked a drug pricing amendment supported by President Trump from inclusion in a health-care spending bill. The provision, which passed the Senate on a bipartisan basis last month, would require drug prices to be disclosed in television advertisements for drugs in an effort to increase transparency and bring down prices. Lawmakers and aides said that House Republicans objected to including the provision in the final version of the funding bill, which was finished by House and Senate negotiators on Thursday. Sen. Dick Durbin (D-Ill.), one of the sponsors of the provision, blamed pharmaceutical companies for exercising their influence to block the measure. “When are we going to stand up to Big Pharma?” Durbin asked. He noted that Trump supported the measure, reading aloud a tweet from the president last month praising the measure as a move “to end the secrecy around ridiculously high drug prices.” The proposal is part of Trump’s plan to lower drug prices, something the president has been vocal about. Republican Sen. Chuck Grassley (Iowa), who co-sponsored the measure with Durbin, tweeted Thursday that it is “EMBARRASSING to bow to BIG PHARMA at expense of consumers” and not include the provision. Asked about the objections, Rep. Tom Cole (R-Okla.), the top health appropriator in the House, said he did not want to get into the details, but said that some House Republicans opposed the provision.”
“The thousands of people who lost Medicaid coverage this month in Arkansas for not following newly implemented work requirements may be a sign of what’s to come in other GOP-led states. Indiana and New Hampshire are slated to implement their Medicaid work requirements next year, and a slew of other states are awaiting approval from the Trump administration. Arkansas has served as a test case of sorts since it was the first state to implement work requirements, and this month it became the first state to kick off beneficiaries for not following them. The state removed more than 4,000 people from the Medicaid rolls, with some estimates saying that number could climb to 50,000 when the requirements are fully implemented in 2019.”
“Opening yet another legal battle over the Affordable Care Act, a coalition of patient advocates and other healthcare groups is going to court to try to block the Trump administration from expanding the availability of short-term health plans that don’t offer a full set of benefits. The lawsuit, filed Friday in federal court in Washington, seeks to blunt one of the signature moves by the administration to weaken patient protections enacted through the 2010 healthcare law, often called Obamacare. It accuses Trump’s Treasury, Labor and Health and Human Services secretaries of jeopardizing access to life-saving medical care for millions of Americans with serious medical conditions, including mental illness, cancer and HIV/AIDS. “It will be more expensive, and perhaps impossible, for some individuals with preexisting conditions to obtain healthcare and health insurance coverage — undermining the purpose of, and congressional plan embodied in, the ACA,” the lawsuit argues. The administration finalized new regulations last month designed to allow insurance companies to sell more short-term plans. That fulfilled a pledge by the president to loosen insurance rules that Republicans say have driven up premiums for consumers who don’t get health coverage through an employer or a government health program such as Medicare or Medicaid. The controversial move — which came on the heels of the unsuccessful campaign last year by congressional Republicans to repeal the healthcare law — will allow people who buy skimpier short-term plans to keep them for as long as three years, up from the previous limit of three months.”
September 7, 2018
The Senate was able to reach an agreement to proceed to the House passed opioid bill (H.R. 6) and consider a substitute amendment offered by Senator Alexander (R-TN). Amendments to the Alexander amendment will not be made in order. The amendment includes additional funding for states to combat the opioid crisis. The bill also gives more authority to the National Institutes of Health to develop non-opioid pain therapies. The amendment does not address the issues in 42 CFR Part 2 regarding sharing substance abuse patients’ records as the House bill does. We are expecting the House and Senate will need to convene a conference committee to resolve the differences between the two bills.
Oral arguments began this week on Texas v. Azar which is the challenge to the Affordable Care Act (ACA) brought by 20 conservative states. The states are arguing that since Congress repealed the individual mandate of the ACA as part of the tax bill last year that the rest of the law must be scrapped as well. Many legal scholars think the states may have a high hurdle to climb with their case, but many of us have been surprised before with ACA cases. While ACA cases have delivered surprising outcomes in the past, many legal scholars believe the states have a high hurdle to climb – and, notably, during his confirmation hearing in front of the Senate Judiciary Committee this week, Supreme Court nominee Brett Kavanaugh also appeared to cast some doubt on the states’ challenge.
Telemedicine got a boost this week with the American Medical Association (AMA) releasing new billing codes that include codes for reimbursement for remote patient monitoring and internet consultations. AMA is urging the Centers for Medicare and Medicaid Services (CMS) to adopt these codes as part of next year’s physician fee schedule rule. Reimbursement has long been seen as a barrier for expanding telemedicine and these codes certainly seem to help lower that barrier.
The Department of Justice appears to be moving closer to the approval of the two big health care mergers with CVS Health acquiring Aetna and Cigna acquiring Express Scripts. Justice has expressed some competition concerns with the CVS-Aetna deal which may mean the disposition of some Medicare Part D related assets.
The New York Times reviewed Bose’s Sleepbuds this week. The Centers for Disease Control (CDC) has identified sleep deprivation as a health epidemic. And we all know too well how our devices can keep us up at night responding to texts and emails, checking scores or standings in fantasy leagues, or how many likes your cute kid pictures are getting on Instagram. But now we have a device to help with your sleep by blocking out distracting noises and replacing them with calming sounds like ocean waves or breezes. Brian Chen gave the device a mixed review so you will have to check them out for yourselves (although it will not be a cheap exploration at $250 per pair).
“Senate Majority Leader Mitch McConnell (R-Ky.) signaled to reporters on Wednesday that he doesn’t have any plans to move again this year to repeal ObamaCare, even though Republicans might now have a better chance of success after Sen. Jon Kyl (R-Ariz.) was sworn in. Senate Republicans view Kyl as someone more likely to vote with GOP leaders on health care reform legislation than was late Sen. John McCain(R-Ariz.), the maverick whom Kyl replaced after his death. McCain’s vote ultimately axed the 2017 GOP effort to repeal ObamaCare. Moderate Republican Sens. Susan Collins (Maine) and Lisa Murkowski(Alaska) also voted no. But taking another stab at an ObamaCare repeal before the end of the year would be a herculean task as Senate Republicans would have to first pass a budget to set up a special process allowing such a bill to pass with a simple majority. “The agenda for the month is already set. We have our plate full through the end of the fiscal year,” McConnell told reporters Wednesday when asked about moving legislation in the next few months to repeal ObamaCare.”
“The Department of Justice is close to approving CVS Health’s acquisition of Aetna and Cigna’s acquisition of Express Scripts, The Wall Street Journal reported Wednesday, citing people familiar with the matter. Both deals could receive formal antitrust approval as soon as the next few weeks, the people told the Journal. Regulators will require CVS and Aetna to sell off assets related to its Medicare drug coverage in order to appease competitive concerns surrounding the nearly $70 billion deal, people familiar with the deliberations told The Wall Street Journal. One potential buyer in talks for the assets is WellCare Health Plans, though discussions between CVS, Aetna and the Justice Department are still ongoing, people told the paper.”
“Lawyers from 20 mostly conservative states on Wednesday demanded a federal judge scrap the “hollow shell” of Obamacare. The judge didn’t immediately rule on their request for an injunction but at times sounded sympathetic to their argument. The oral arguments opened the latest legal bid to kill the 2010 health care law, which has survived two major Supreme Court rulings and months of repeal efforts in Congress. While numerous legal experts have deemed the argument outlined in this case a stretch, Attorney General Jeff Sessions has thrown the Trump administration’s weight behind key parts of the legal assault, notably calling on the court to toss out the law’s popular protection for people with pre-existing conditions. The red states’ lawsuit has already become grist for campaign attacks ahead of the midterm elections, with Democrats pillorying Republicans for putting at risk protections for sick individuals. More than 7 in 10 Americans – including a majority of Republicans – said maintaining that protection is “very important,” according to the latest survey from the Kaiser Family Foundation. Two of the attorneys general pressing the lawsuit – Josh Hawley in Missouri and Patrick Morrisey in West Virginia – are running for Senate, challenging incumbent Democrats in states that Trump carried. U.S. District Court Judge Reed O’Connor, a George W. Bush appointee, vigorously questioned attorneys during the three-hour hearing but gave no indication of when he would rule. “
“The Senate has reached an agreement on an opioids package aimed at addressing the national epidemic that killed 72,000 Americans last year. The deal was first announced in a tweet Thursday night by Majority Leader Mitch McConnell’s (R-Ky.) spokesman, Don Stewart, who wrote that Democrats lifted a hold placed on the bill and that a floor vote was likely next week. Soon after, Sen. Rob Portman (R-Ohio) — who has several bills that are part of the package including an effort to combat synthetic drugs like fentanyl — released a statement saying that the bill would be voted on next week. The House passed another package of opioid measures in June, and the two sets of bills would need to be reconciled before becoming law. President Trump has declared the opioid crisis a public health emergency and on Aug. 20 urged the Senate to pass legislation that tackled the fentanyl problem specifically. The Senate bill had stalled over Democratic objections to a grant program they said was written too narrowly to benefit only one addiction advocacy group, the Addiction Policy Forum. The organization was closely connected to PhRMA and Democrats wanted the language broadened to cover more groups. This hold up was first reported Wednesday by Politico. Senators had been working all summer to reach a deal on opioid legislation, which has emerged as a rare bipartisan priority ahead of November’s midterm elections. Trump increased the pressure by tweeting that they must pass the Portman-sponsored bill on shipments of illicit fentanyl through the international postal system.”
“Millions of people covered under the Affordable Care Act will see only modest premium increases next year, and some will get price cuts. That’s the conclusion from an exclusive analysis of the besieged but resilient program, which still sparks deep divisions heading into this year’s midterm elections. The Associated Press and the consulting firm Avalere Health crunched available state data and found that “Obamacare’s” health insurance marketplaces seem to be stabilizing after two years of sharp premium hikes. And the exodus of insurers from the program has halted, even reversed somewhat, with more consumer choices for 2019.The analysis found a 3.6 percent average increase in proposed or approved premiums across 47 states and Washington, D.C., for next year. This year the average increase nationally was about 30 percent. The average total premium for an individual covered under the health law is now close to $600 a month before subsidies. For next year, premiums are expected either to drop or increase by less than 10 percent in 41 states with about 9 million customers. Eleven of those states are expected to see a drop in average premiums. In six other states, plus Washington, D.C., premiums are projected to rise between 10 percent and 18 percent. Insurers also are starting to come back. Nineteen states will either see new insurers enter or current ones expand into more areas. There are no bare counties lacking a willing insurer.”
August 24, 2018
*Healthcare Today is taking a small summer vacation. There will be no Healthcare Today update next week. Healthcare Today will return on September 7th. Have a good Labor Day weekend! *
The Senate passed the Labor-Health and Human Services-Education (Labor-HHS) Appropriations bill combined with the Defense Appropriations bill this week on a strong vote of 85 to 7. The Senate has not considered and passed a Labor-HHS appropriations bill since 2003. In 2003 Arnold Schwarzenegger was elected Governor of California and Finding Nemo was a hit at the box office to put things in perspective.
The bill includes a $2 billion increase in funding for the National Institutes of Health (NIH) matching a similar increase in funding. NIH faced flat funding for 12 years, but its budget has jumped from $30 billion to $39 billion in four years. The bill also includes significant resources to fight the opioid crisis. $3.7 billion is included for treatment and prevention measures. And $10 billion is included to fund research at the Department of Defense for non-addictive treatments for chronic pain. Also, of note the Senate included an amendment from Senators Grassley (R-IA) and Durbin (D-IL) to include funding for the Secretary of HHS to develop regulations to require pharmaceutical companies to disclose their price in direct-to-consumer advertising.
Speaking of the Senate, we are hearing the upper chamber is poised to consider a package of legislation in response to the opioid epidemic. We are hearing it will likely be on the floor after Labor Day. Insurance companies are lobbying hard to make sure the provision in the House passed bill (H.R. 6) to extend insurance coverage for people with end-stage renal disease (ESRD) to 33 months from 30 months in current law is kept out of the Senate package.
The Centers for Medicare and Medicaid Services (CMS) approved a waiver this week for the state of Maryland to implement a reinsurance program to help lower the cost of insurance plans sold on the Affordable Care Act (ACA) exchanges. The Maryland legislature approved two bills to create a reinsurance program for the individual market in the state. A tax is being imposed on insurance companies to subsidize the insurance plans with the most expensive patient population.
Tuesday marked the 100th day since the President rolled out his plan to combat the high cost of prescription drugs. HHS touted the fact that 15 drug companies have either “reduced list prices, rolled back planned price increases, or committed to price freezes for the rest of 2018.” Keep in mind that some of these pricing decisions came before the President made his announcement, but many companies have also reacted to the President’s messaging around drug pricing.
Google is exploring new fitness goals beyond the 10,000 steps a day goal as they are finding many people are intimidated by that goal. For us shoe-leather lobbyists, we often exceed that goal in just the morning of a client’s fly-in, but we understand the need to do more to encourage healthy lifestyles across the board. Google is looking at giving credit for activities like taking the stairs over using an elevator and creating rings on the Apple Watch for other goals beside 10,000 steps.
“U.S. Health and Human Services Secretary Alex Azar said it was within his agency’s power to eliminate rebates on prescription drug purchases, a key element of the Trump administration’s plan to lower prescription medicine costs. Such rebates are negotiated in the United States by pharmacy benefits managers (PBMs) to lower the cost of medicines for their clients, including large employers and health plans that cover tens of millions of Americans. Drugmakers say they are under pressure to provide rebates to the few PBMs that dominate the market, which include CVS (CVS.N), Express Scripts (ESRX.O) and UnitedHealth’s Optum (UNH.N), and that those payers do not pass on enough of those savings to patients – a contention the PBMs dispute. The drugmakers say the rebates force them to raise the price of their therapies over time to preserve their business. The Trump administration has been receptive to that argument. Azar, in an interview with Reuters on Friday, said rebates created a perverse incentive to continuously raise drug prices. Azar, a former top executive at drugmaker Eli Lilly & Co, is trying to deliver on President Donald Trump’s promises to lower the cost of prescription drugs for Americans, which Trump made a major priority during his 2016 presidential campaign.”
“The Justice Department has arrested one of the biggest sellers of drugs on the dark web and moved to bar two Ohio doctors from prescribing medications, part of a sprawling effort to prosecute drug cases amid the nation’s opioid epidemic. It is one of several arrests, charges and guilty pleas involving illicit and prescription drugs announced in Cleveland on Wednesday, as Attorney General Jeff Sessions is moving aggressively against those who distribute illicit drugs and illegally prescribe legal ones.“ Today’s announcements are a warning to every trafficker, every crooked doctor or pharmacist, and every drug company, every chairman and foreign national and company that puts greed before the lives and health of the American people: this Justice Department will use civil and criminal penalties alike, and we will find you, put you in jail, or make you pay,” Sessions said. Federal prosecutors allege that Matthew and Holly Roberts of San Antonio were two of the biggest drug dealers on the dark web, completing nearly 3,000 verified transactions on various underground marketplaces between 2011 and 2018 — including the largest number of verified fentanyl transactions on the dark web. Prosecutors said they operated under the name “MH4Life.” They could not be reached for comment Wednesday. In addition to the powerful synthetic opioid fentanyl, which has caused the number of overdose deaths nationwide to skyrocket, authorities allege the couple possessed and distributed fentanyl analogues, heroin, cocaine, methamphetamine, Xanax and other drugs.”
“The Senate on Thursday overwhelmingly passed an $857 billion spending package that Republican leaders are counting on to convince President Donald Trump to back down from threats of a government shutdown in September. The package, an uncommon bipartisan truce to fund two-thirds of government operations, was strategically crafted to ward off a presidential veto. But the odds remain long that the legislation will even make it to the White House, with just 11 working days left for House and Senate lawmakers to merge opposing versions of the bills — and get Trump’s approval — before funding runs out on Sept. 30. The Senate passed the fiscal 2019 package 85-7 during its rare mid-August session, after spending leaders brokered a temporary detente on including partisan policy language that has traditionally hindered the chamber’s ability to pass funding bills. The two bills in the package, which Senate Majority Leader Mitch McConnell called “hugely important,” would fund the departments of Defense, Labor, Education and HHS. The legislation includes victories for both parties, like the largest military pay raise in nearly a decade and an expansion of programs to counter opioid addiction. At the same time, McConnell and Minority Leader Chuck Schumer sidestepped political flash points like efforts to include provisions on abortion funding and the Trump administration’s policies for separating families that cross the border illegally.”
“The Senate on Thursday passed a measure to provide funding to require drug advertisements to disclose the price of the drug after a last-minute push. The passage came as part of the massive health-care spending bill that the Senate passed on Thursday, which included the amendment from Sens. Chuck Grassley (R-Iowa) and Dick Durbin (D-Ill.). The move marks a rare moment where Congress took some action aimed at high drug prices, a contentious issue that has been a recent target of Democrats and the Trump administration. “More information gives transparency to the transaction and will help give American consumers a break and start to slow down the skyrocketing cost of prescription drugs,” Durbin said in a statement. The Senate’s health spending bill still needs to be reconciled with the House’s before it goes to the president’s desk. Grassley and Durbin worked up until Thursday to get their amendment included, warning that powerful pharmaceutical companies were working against them.”
“The Trump administration needs to take more steps to better manage ObamaCare after enrollment dropped by 5 percent in 2018, the nonpartisan Government Accountability Office (GAO) said in a critical report released Thursday. The GAO recommended that the Department of Health and Human Services (HHS) set enrollment targets for 2019, a practice taken by the Obama administration but abandoned by the Trump administration, and better manage local groups responsible for signing people up for ObamaCare. Congressional Democrats who requested the report said its conclusions are proof the administration purposely set the Affordable Care Act (ACA) up for failure. “This independent and nonpartisan GAO report confirms that the Trump Administration’s sabotage of our health care system is driving up costs for consumers and leaving more Americans without health insurance,” Rep. Frank Pallone Jr. (D-N.J.) and Sens. Patty Murray (D-Wash.), Ron Wyden (D-Ore.) and Bob Casey (D-Pa.) said in a statement. “It’s not surprising that consumers were confused about the status of the ACA at the end of last year, which made the extreme cuts to consumer outreach and advertising that much more egregious.” Most of the stakeholders interviewed by the GAO said consumer confusion about ObamaCare likely played a major role in the decline in enrollment. While 9.2 million people signed up for ObamaCare plans in 2017, 8.7 million people enrolled in 2018. Stakeholders also blamed the administration’s decision to cut funds for outreach and advertising.”
The House Ways and Means Committee released its report on their red tape initiative aimed at seeking to remove regulatory barriers to improved health care outcomes. The report summarizes the efforts by the committee to work with stakeholders to identify these regulatory burdens. The report states the committee work is not done in this area and highlights the committee’s efforts to work with the administration on rulemaking but it is not clear from the report whether there will be further legislative action taken in this Congress on this issue.
The Senate Republican leadership released the text of a new opioid bill that combines the work of the Senate Finance; Health, Education, Labor and Pensions (HELP); and Judiciary Committees. The text was filed as a substitute amendment to the House passed opioid bill H.R. 6. The Senate is expected to turn to this bill after the passage of its next minibus comprised of the Defense and Labor, Health and Human Services, and Education appropriations bills.
Speaking of which, the Senate is expected to sort through numerous amendments that will be filed to the next minibus starting next week. Given the breadth of the bills, there is expected to be numerous controversial amendments ranging from abortion to migrant children to Department of Defense policies filed to the bill. The Senate Appropriations Committee is hoping the Senate can pass the bill without any so-called poison pill amendments included.
The Food and Drug Administration (FDA) announced on Thursday the approval of the first generic version of Mylan’s EpiPen. FDA touted this approval as another way the administration is helping to lower the cost of prescription medications. Similarly, Senate Judiciary Committee Chairman Chuck Grassley (R-IA) praised the approval as “great news for millions of Americans who depend on life-saving anti-allergy devices.” Mylan had widely criticized over price increases for their EpiPen. It is yet to be seen, however, how the new generic version will be priced.
Senator Grassley also made news this week when he called for anti-trust reviews of the two pending large healthcare mergers between CVS Health and Aetna and Cigna and Express Scripts. Grassley wrote a letter to the Assistant Attorney General for Antitrust to urge a careful examination of the pending mergers to ensure that these transactions do not lead to less competition and consumer access in the pharmaceutical supply chain.
“Google parent Alphabet has invested $375 million in next-gen health insurance company, Oscar Health. Google has been a longtime supporter of the six-year-old New York company, having previously invested in Oscar through its Capital G investment wing and Verily health and life sciences research wing. “Alphabethas invested in Oscar over many years and has seen the company and its team up close. We’re thrilled to invest further to help Oscar in its next phase of growth,” an Alphabet spokesperson told TechCrunch. That $165 million round raised back in March valued the health startup at around $3 billion. The new round maintains a similar valuation, while giving Alphabet a 10 percent share in Oscar. The deal also has longtime Google employee and former CEO Salar Kamangar joining Oscar’s board.”
“Three consumer groups are suing the Trump administration in an effort to halt the implementation of work requirements in Arkansas’ Medicaid program. The administration earlier this year approved Arkansas’ request to require certain Medicaid recipients to work 80 hours a month or lose their benefits. The mandate went into effect on June 1 for enrolleeswho are between the ages of 30 and 49, not disabled and don’t have dependent children at home. It will expand to those age 19 to 29 next year. The National Health Law Program, along with Legal Aid of Arkansas and the Southern Poverty Law Center, filed the suit in U.S. District Court in Washington D.C. on Tuesday. The suit charges that approval of Arkansas’ waiver runs counter to Medicaid’s objective of providing the poor with access to health care. It comes about six weeks after consumer groups successfully stopped the implementation of work requirements in Kentucky. A district court judge slammed the Department of Health and Human Services for not considering the waiver’s detrimental impact on enrollees. The administration is seeking to address the court’s concerns andhas reopened the application for evaluation. In Arkansas, thousands are already having trouble meeting the new rules. Nearly 30% of eligible enrollees did not satisfy the requirement in June. They have two more months to get back on track or get kicked out of the program. The rest worked, went to school, volunteered, searched for jobs or qualified for exemptions.”
“Drug overdose deaths surpassed 72,000 in 2017, according to provisional estimates recently released by the Centers for Disease Control and Prevention. That represents an increase of more than 6,000 deaths, or 9.5 percent, over the estimate for the previous 12-month period. That staggering sum works out to about 200 drug overdose deaths every single day, or one every eight minutes. The increase was driven primarily by a continued surge in deaths involving synthetic opioids, a category that includes fentanyl. There were nearly 30,000 deaths involving those drugs in 2017, according to the preliminary data, an increase of more than 9,000 over the prior year. Deaths involving cocaine also shot up significantly, putting the stimulant on par with drugs such as heroin and the category of natural opiates that includes painkillers such as oxycodone and hydrocodone. One potential spot of good news is that deaths involving those latter two drug categories appear to have flattened out, suggesting the possibility that opiate mortality may be at or nearing its peak.”
“President Donald Trump said Thursday he wants the U.S. government to sue pharmaceutical companies that manufacture opioids as part of his efforts to halt an epidemic of drug addiction. Trump said he’d like to bring a federal lawsuit, rather than just join existing litigation against the drugmakers. “Some states have done it,” Trump said during a Cabinet meeting at the White House. “But I’d like a lawsuit to be brought against these companies that are really sending opioids at a level — it shouldn’t be happening. So highly addictive. People go into a hospital with a broken arm, they come out, they’re a drug addict.” Drugmakers such as Purdue Pharma LP and Johnson & Johnson that sell opioid painkillers face hundreds of lawsuits filed by states, cities, counties, Native American tribes and labor unions as the epidemic of addiction continues to rage in the U.S. The Centers for Disease Control and Prevention said preliminary estimates indicate that almost 72,000 Americans died from opioid overdoses last year, a figure that has been rising for years.”
The Trump administration continued with its push to help lower prescription drug prices. On Tuesday, August 7th, the Centers for Medicare and Medicaid Services (CMS) announced that Medicare Advantage plans can now begin to use step therapy for physician-administered drugs. That means patients have to start with the least costly therapies and insurance companies would have to give prior approval before more costly drugs can be used. Physician-administered drugs are covered under Medicare Part B currently and represent about $12 billion in spending under Medicare Advantage plans. The Department of Health and Human Services (HHS) estimates that this policy will save between 15 to 20 percent.
The Office of the National Coordinator of Health Information Technology (ONC) held a three-day conference on interoperability this week. CMS Administrator Seema Verma vowed to make health-care providers “fax-free” by 2020. ONC’s Steve Posnack declared that there will be a new holiday coming up. October 12, 2018 will be “No Fax Friday.” Pretty amazing that with all of the technical advances we are still discussing fax machines. There were many other important issues discussed at the forum in terms of patient matching, interoperability infrastructure, and many more.
CMS released a proposed rule on Thursday to revamp the Medicare Shared Savings Program where Accountable Care Organizations (ACOs) are eligible for shared savings payments if they are able to deliver savings in Medicare Part A and Part B using coordinated care models. Under the current Shared Savings Program, ACOs can opt for different tracks with different levels of risks and possible rewards. CMS Administrator Verma stated that she wants to see ACOs taking on more risk as most of the ACOs are participating in track 1 of the Medicare Shared Savings program where there is no risk of losing money if they do not meet key goals and the cost of care is greater than in a traditional care setting. The trade association for ACOs expressed some disappointment with this proposal.
Many states are reacting to the short-term plans regulation issued by the Trump administration last week. Sixteen states have vowed to regulate these plans more rigorously than the federal government will under this rule. Since insurance is still regulated at the state level, there is not much the federal government can do about those reactions. The White House has been touting the savings that individuals can achieve by buying a short-term plan versus buying a Silver plan (one of the least expensive) on the Affordable Care Act exchanges.
The Food and Drug Administration on Monday announced a shift in the way it evaluates drugs to treat opioid addiction that the agency says will give it more flexibility to approve new treatments. Now, rather than merely examining whether a potential treatment reduces opioid use, the agency will consider factors like whether a drug could reduce overdose rates or the transmission of infectious diseases. “We must consider new ways to gauge success beyond simply whether a patient in recovery has stopped using opioids, such as reducing relapse overdoses and infectious disease transmission,” FDA Commissioner Scott Gottlieb said in a statement. The announcement is the latest in a string of efforts to improve the federal government’s response to the growing opioid crisis, which also includes legislation on Capitol Hill that aims to ensure treatment is evidence-based and, separately, to ensure more federal programs will pay for methadone treatment. MAT, coupled with psychosocial counseling, is widely acknowledged to be the standard of care in treating opioid addiction. Currently, just three drugs exist to treat opioid use disorder: buprenorphine, methadone, and naltrexone. Adherence to the drugs is typically low, and addiction treatment experts have long said MAT is vastly underutilized, calling for expanded access to existing options and the development of more drugs beyond the existing three.”
“Pharmaceutical companies will soon have to negotiate prices for more drugs. The Centers for Medicare & Medicaid Services will allow Medicare Advantage plans to negotiate prices of medicines covered under Medicare Part B, which covers drugs typically administered by a physician. These tend to be more expensive treatments like rheumatoid arthritis drugs and some cancer drugs. Medicare Advantageplans, which are offered by private companies, will also be able to use step therapy, or starting patients on less expensive options before moving them up to more expensive drugs. CMS Administrator Seema Verma told reporters Tuesday this practice is already “widely used” across the private sector. Verma said she expects lower drug prices to come from insurers and pharmacy benefit managers negotiating better discounts and passing those savings on to patients. They’ll be required to pass on more than half of these savings. “For too long, Medicare Advantage plans have not had the tools to negotiate a better deal for patients,” Verma said in a statement. “Today we begin lifting those barriers so plans can use private-sector tools to drive down the cost of expensive drugs while also offering new care coordination and drug adherence programs, to ensure that patients are getting high quality care at lower cost.” Plans can implement the changes starting Jan. 1, 2019. In a statement, Health and Human Services Secretary Alex Azar said drug prices “can start coming down for many of the 20 million seniors” enrolled in Medicare Advantage plans “as soon as next year.” Spending on drugs covered under Part B totaled $27.5 billion in 2015, according to a report from The Medicare Payment Advisory Commission. A handful of treatments covered under Medicare Part B cost more than $1 billion in one year alone, according to government data from 2016.”
U.S. President Donald Trump said he would make an announcement next week that would bring down prescription drug prices “really, really substantially.” Trump didn’t further explain the action he would take in comments to reporters at the beginning of a dinner Tuesday with corporate leaders at his golf club in Bedminster, New Jersey. Trump said the prices of prescription drugs made by Pfizer, Novartis and other pharmaceutical companies were “too high.” He added, “We are announcing something next week which is going to get them down really, really substantially.”
“Two top Republicans are urging the White House to complete a thorough economic analysis before releasing a new policy that could completely upend the way prescription drugs are purchased. In a letter to Office of Management and Budget (OMB) Director Mick Mulvaney, House Energy and Commerce Committee Chairman Greg Walden (R-Ore.) and Senate Finance Committee Chairman Orrin Hatch (R-Utah) said they want a full analysis of a pending proposed rule regarding prescription drug rebates. “The publicly available title of the rule indicates that the action contemplated could be significant in scope, with the potential to dramatically change the process by which prescription drugs are purchased within the supply chain,” Walden and Hatch wrote. Even without knowing the full details of the proposal, the chairmen said the changes “could ripple across the health care sector.” The proposed rule is part of the administration’s efforts to bring down the costs of prescription drugs. The rule, which is currently under review by the OMB, could remove the legal protection of rebates paid by drug companies to insurers and pharmacy benefit managers. Generally, a pharmaceutical company pays a rebate so a pharmacy benefit manager – the third-party administrators of prescription drug programs – will make its product the only one of its kind on the list approved for reimbursement or so that the co-pay for its product is less than the co-pay of competing products.”
“Health and Human Services Secretary Alex Azar on Thursday urged states to cooperate with the Trump administration’s expansion of “short-term” health plans outside of ObamaCare. Several state regulators have moved to restrict the sales of these plans in their states, arguing that, despite being less expensive than ObamaCare plans, they’re bad for consumers and aren’t an adequate substitute for comprehensive insurance. Unlike plans sold under ObamaCare, the administration’s short-term health plans do not have to cover services like maternity care or prescription services, and they can deny coverage to people with pre-existing conditions. Speaking at the American Legislative Exchange Council in Louisiana, Azar said the short-term plans are a viable option for people who can’t afford ObamaCare, arguing that states should not restrict access to them. “This affordable option will only be as available as state legislators and insurance commissioners allow it to be,” Azar said. The administration issued a rule last week extending the maximum duration of short-term plans from three months to up to three years.”
August 3, 2018
The Departments of Health and Human Services (HHS), Labor, and Treasury released a final rule on Wednesday defining short-term healthcare plans that do not need to comply with the Essential Health Benefits requirements of the Affordable Care Act (ACA). These plans also do not have to comply with the requirement that 80 percent of the plans revenues be spent on medical care or quality improvement. Nor do these plans have to comply with the pre-existing condition ban in the ACA.
Under the Obama Administration, these plans were limited to 3 months to be used for sudden and unforeseen circumstances such as a disruption in work. Under the Trump Administration’s rule, these plans are 12 months in duration and may be renewed by the insurer providing coverage three times (for a total of three years). The Trump Administration is touting this rule as a way to help drive down the cost of health insurance. Critics of this rule believe this will further undermine the ACA marketplaces. This rule is likely to be challenged in the courts and Congress. Senate Democrats are planning to introduce a Congressional Review Act resolution to repeal this regulation.
The Federal Communications Commission voted unanimously to advance the $100 million telehealth pilot program. The program would fund broadband deployment to connect Medicaid beneficiaries and veterans to at-home telehealth services such as monitoring for chronic conditions. FCC has previously supported broadband deployment to connect healthcare facilities but this is the first time they will be connecting with patients.
The Centers for Medicare and Medicaid Services (CMS) released a trove of Medicare Advantage (MA) data to CareSet, the health data NGO. CareSet will aggregate the data and release it for studies and analysis. This is the first time MA data has been released from CMS which is significant as about one third of seniors are enrolled in MA plans.
The Senate Committee on Health, Education, Labor, and Pensions held their third hearing in a series on healthcare costs. The focus of this hearing was on administrative costs. Each of the three witnesses, of course, pointed to different drivers of administrative costs. This was also the hearing where a Senator made a quip about dropping acid.
We are expecting the Senate to consider the Labor-HHS appropriations bill when it returns on August 15th. This bill will be paired with the Department of Defense appropriations bill to create another minibus. If the Senate can manage to get 60 votes to cut off debate and amendments to the bill, they will likely push the House to pass it as written by the Senate.
“Hoping to head off a full expansion of Medicaid under the Affordable Care Act, some senior officials in the Trump administration and Republican governors have been pushing hard for a smaller expansion to satisfy a growing political demand in their states. But President Trump decided on Friday to shut down the debate until after the midterm elections, administration officials said. The debate has divided the Trump administration between top officials at the Department of Health and Human Services and hard-liners, mainly at the White House, more determined to snuff out the Affordable Care Act. And it gained steam as states pressed forward with Medicaid expansions that could leave more people with health coverage under the Affordable Care Act next year than when Mr. Trump took office. This year, Virginia expanded Medicaid through the Affordable Care Act. Maine voters approved an expansion that is likely to begin after the current governor, Paul R. LePage, leaves office next year. And ballot measures in Utah, Idaho and Nebraska could expand Medicaid in deep red states.”
“Enrollment in the individual health insurance market — the market for people who don’t get coverage through work — has declined 12 percent in the first quarter of 2018, compared to the same period last year, according to a new analysis released Tuesday. The analysis from the Kaiser Family Foundation showed enrollment in the individual market grew substantially after the implementation of the Affordable Care Act (ACA) and remained steady in 2016, before dropping by 12 percent in 2017. There were 17.4 million people enrolled in the individual market in 2015, compared to 15.2 million in 2017 and 14.4 million in the first quarter of 2018. The study notes that much of the decline is concentrated in the off-exchange market, where a number of enrollees are not eligible for ObamaCare subsidies and therefore not protected from significant premium increases in 2017 and 2018. In this market, enrollment numbers dropped by 38 percent from the first quarter of 2017 to the first quarter of 2018. The Trump administration last year canceled key ObamaCare subsidies for insurers, leading insurers to increase premiums substantially.”
“Pfizer Chief Executive Ian Read said on Tuesday he believes the Trump administration intends to stop the practice of allowing rebates on prescription drug purchases, suggesting that U.S. drug pricing reforms may focus on middlemen rather than drugmakers. “I believe the administration does want to remove rebates, and they consider it a priority,” he said in an interview, following similar comments made on Pfizer’s conference call to discuss second quarter earnings. The administration has already proposed a rule that would scale back protections currently in place that allow rebates between drug manufacturers and insurers and pharmacy benefits managers (PBMs). Read said he believes the administration wants to get rid of them entirely.”
“The Trump administration took another whack at the Affordable Care Act on Wednesday. Officials unveiled a final rule that will make it easier to obtain coverage through short-term health insurance plans, which don’t have to adhere to the law’s consumer protections. The move would reverse an Obama administration decision to limit the duration of short-term plans to no more than 90 days in order to make them less attractive. Insurers will soon be allowed to sell these policies for just under a year. They can be renewed for up to 36 months, though that renewal isn’t guaranteed. Administration officials say the short-term plans will provide a cheaper health insurance alternative for those who can’t afford to buy coverage on the Obamacare exchanges. “We fully recognize that these products are not necessarily for everyone, but we do think they will provide an affordable option to many, many people who’ve been priced out of the current market under the Obamacare regulations,” said Randy Pate, a deputy administrator at the Centers for Medicare & Medicaid Services. But patient advocates and health policy experts argue that these policies provide only skimpy coverage and will undermine the Affordable Care Act. Other actions the administration has taken this year include making it easier for small businesses to band together to buy coverage and slashing support for a program that helps people sign up for Obamacare.”
“Top Senate Democrats said they are planning to force a vote on a measure that would overturn the Trump administration’s rule expanding access to cheap, controversial insurance plans. The resolution of disapproval will be introduced by Sen. Tammy Baldwin(D-Wis.). During a call with reporters Thursday, Senate Minority Leader Charles Schumer (D-N.Y.) said he thinks there will be unanimous support among Democrats once the resolution is introduced. The measure will only require 51 votes to pass, which would mean that in Sen. John McCain’s (R-Ariz.) absence the backers need to recruit one Republican to their cause. “All it takes is one or two Republicans who claim to support preexisting condition protections,” Schumer said. The resolution aims to overturn the Trump administration’s new rule that expands access to non-ObamaCare insurance plans. The administration touts these plans because they offer lower premiums for healthy people, but the plans don’t need to follow ObamaCare rules, meaning they can charge people with preexisting conditions higher premiums and leave out coverage of certain health services. Democrats attack the plans as “junk” insurance and say the move is part of the administration’s efforts to “sabotage” ObamaCare.”
July 27, 2018
The House had three healthcare bills on the floor this week. Two of the bills (H.R. 6199 and H.R. 6311) expanded the use of health savings accounts (HSAs) to allow more uses for HSAs for preventive care and over-the-counter medications and to increase contributions respectively. The third bill (H.R. 184) permanently repeals the medical device tax imposed by the Affordable Care Act (ACA). Earlier this year Congress approved and the President signed into law a two-year delay of the tax as part of a continuing resolution.
The Centers for Medicare and Medicaid Services (CMS) released the hospital outpatient prospective payment system (OPPS) proposed rule this week. The rule contains a controversial site-neutral payment proposal where hospital reimbursements are lowered to the levels provided for similar treatments in a physician office. The rule also expands the number of services that can be preformed in ambulatory surgical centers. CMS is touting these provisions as increasing competition in healthcare. However, hospitals will likely strongly oppose these proposals and the proposed reductions in reimbursements for drugs purchased under the 340B program.
CMS also released a rule this week to authorize the risk adjustment program under the ACA. This is the program that allows insurance companies with low-risk patient populations to compensate the insurance companies that have high-risk patient populations. The Trump administration had previously suspended these payments, but this final rule re-establishes the program.
Attorney generals from 11 states and the District of Columbia filed suit against the Trump administration over their association health plan final rule. The lawsuit claims that the Department of Labor did not follow the Administrative Procedures Act in crafting the rule to redefine “employer” to allow for businesses to pool together to offer health insurance that does not need to comply with the essential health benefits requirement of the ACA.
It seems like we are always hearing “there is an app for that?” these days. But this one caught our attention. The California medical board developed an app to allow patients to check on the licensure status of their physician to see if they have moved, added a new specialty, or have been subject to disciplinary actions for transgressions.
“Robert Wilkie, a Pentagon under secretary, was confirmed Monday by the Senate as secretary of the Department of Veterans Affairs, giving the sprawling agency its first permanent leader in months. The vote, which was 86-9, came the day before the President will address the Veterans of Foreign Wars national convention in Kansas City. Nominees to lead the VA are typically confirmed unanimously by the Senate. While Wilkie was confirmed overwhelmingly, the vote was the first time since the VA secretary became a Cabinet position that any senators voted against confirmation. In a statement, President Donald Trump praised Wilkie as someone who has “dedicated his life to serving his country with honor and pride,” and said Wilkie has displayed “great patriotism and a commitment to supporting and empowering America’s armed forces and veterans.” The nine lawmakers who voted against Wilkie’s nomination were mostly Democrats, joined by Bernie Sanders, a Vermont independent, who cast the lone dissenting vote against advancing Wilkie’s nomination in committee. Sanders said then that he voted no because he was concerned that the Trump administration would privatize the VA’s health care.”
“The House on Tuesday voted to repeal ObamaCare’s medical device tax, a provision that members of both parties have criticized as harming innovation. The House voted 283 to 132 to repeal the 2.3 percent tax on sales of medical devices, with some Democrats joining Republicans to approve the measure. 57 Democrats voted for the measure. The vote comes during a week of health-care measures put forward by the GOP as they try to blunt Democratic attacks over rising premiums, a key midterm message. The vote could help Rep. Erik Paulsen (R-Minn.), the sponsor of the bill, who faces a tough reelection fight this year. “This bill reverses a harmful tax that is hurting job growth and innovation across the country,” Paulsen said. There is no clear path forward for the measure in the Senate this year, however.”
“The Centers for Medicare and Medicaid Services is proposing to move toward site neutral payments for clinic visits and to close a loophole through which providers are billing patients more for visits in hospital outpatient departments when they create new service lines. In a proposed rule for the 2019 Medicare hospital outpatient prospective payment system and ambulatory surgical center payment system, CMS has proposed site neutral payments for clinic visits, the most common service billed under the OPPS. Currently, CMS often pays more for the same type of clinic visit in the hospital outpatient setting than in the physician office setting. If finalized, the proposal is projected to save patients about $150 million in lower copayments for clinic visits provided at an off-campus hospital outpatient department, CMS said. The proposed rule aims to address other payment differences between sites of service. For 2019, CMS is proposing to expand the number of procedures payable at ambulatory surgical centers to ensure the payment for procedures involving certain high-cost devices parallels the amount provided to hospital outpatient departments.”
“The House on Wednesday passed a measure to delay ObamaCare’s health insurance tax for two years and expand Health Savings Accounts, part of a GOP effort to try to lower premiums. The bill, which passed 242-176, is part of a Republican effort to blunt Democratic attacks on the GOP for rising premiums – a key argument in the midterm elections this year. The health insurance tax has been criticized by Republicans and some Democrats for driving up premiums. “This is a flawed tax that gets passed onto American families,” Rep. Peter Roskam (R-Ill.) said on the House floor. Democrats, though, said the measures would have no substantial impact on premiums, and instead pointed to Republican efforts to protect themselves in the midterms.”
“Department of Health and Human Services Secretary Alex Azar said the agency is “undeterred” by a judge’s ruling overturning work requirements in Kentucky. Addressing the Heritage Foundation on Thursday morning, Azar said the agency’s goal is to make “sensible reforms” that address the Medicaid program’s growth and changing demographics, as Medicaid expansion led to far more single, “able-bodied” enrollees. “I’ve told the team as we work on this that the mantra should be common sense,” Azar said. “Anything a state does here, people should look at it, ‘Oh yeah. That’s not some unreasonable, crazy thing.” A judge in the U.S. District Court for the District of Columbia ruled that HHS did not consider whether adding the work requirements would allow Kentucky’s Medicaid program to provide medical assistance to people in the state. In approving Kentucky’s work requirements waiver, HHS failed to note that the changes could lead to 95,000 people losing coverage—a “glaring” oversight, the judge ruled.”
July 20, 2018
Despite the challenging environment of a charged election year, Congress did approve two bipartisan health bills this week. The Energy and Commerce Committee approved H.R. 6378 to reauthorize the programs in the Pandemic and All-Hazards Preparedness Act. The bill authorizes additional funding to respond to pandemic influenza and emerging infectious diseases. The Energy and Commerce Committee also approved H.R. 5333 to revamp the approval process for over-the-counter drugs. The bill creates a $134 million Food and Drug Administration (FDA) user fee program to approve these medications.
A federal appeals court upheld a decision from a lower court to allow the Trump Administration to move forward on their plan to cut $1.6 billion in reimbursements under the 340B program. In a unanimous decision, the court found that the hospital associations lawsuit was premature because the cuts had not yet taken effect. The American Hospital Association has already stated it plans to refile their suit in district court.
FDA Commissioner Scott Gottlieb outlined an 11-point biosimilar action plan at speech before the Brookings Institution as part of the administration’s efforts to tackle high drug prices. The plan is seeking to spark competition in the biosimilar market. While only 2 percent of patients use biosimilar treatments, they account for 40 percent of total spending on drugs.
FDA is also tackling the controversial issue of drug importation. FDA is convening a working group to explore the issue of importing single source drugs with no patents or exclusivities associated with it for instances when there is a price spike or there are patient access issues.
During the last week, we saw our country celebrate national daiquiri day, national hot dog day and national ice cream day. Let’s hope our fruit and vegetables get national recognition in the coming weeks to get our diets back on track.
“House Ways and Means Committee Chairman Kevin Brady (R-Texas) said Monday that he is in talks with the Trump administration about ways to restart key ObamaCare payments that the administration abruptly suspended this month. The administration’s surprise suspension of $10.4 billion in payments to insurers this month set off a round of warnings of rising premiums and condemnation from Democrats who said it was further GOP “sabotage” of the health-care law. Brady, a key congressional Republican on health-care issues, told reporters Monday that he is talking with Health and Human Services Secretary Alex Azar and others about how to restart the payments. “The administration wants to restore those payments, so we’re looking at ways that we can help them do that,” Brady said. He left open the possibility of legislative action to help address the situation. The House is planning to vote next week on a range of health-care bills, including expanding health savings accounts and delaying or repealing certain ObamaCare taxes, Brady said.”
“An appeals court on Tuesday rejected an attempt by hospitals to challenge the Trump administration’s changes to the controversial federal drug discount program known as 340B, sticking them with a $1.6 billion cut in federal payments. The decision is the latest in a series of blows to hospitals trying to preserve the program, which increasingly pits them against the drug makers who must offer steep discounts on medicines under its rules. Participating hospitals get higher reimbursement for the drugs from the federal government, and use the difference to cover charity care and other costs. Last July, the Trump administration proposed slashing its higher reimbursement for the drugs by about 27 percent — amounting to a roughly $1.6 billion cut for the industry in 2019. Hospitals, led by the American Hospital Association, America’s Essential Hospitals, and the Association of American Medical Colleges along with three of their individual members, lost their initial lawsuit over the cuts when a federal judge ruled they had contested the change prematurely, before any of the cuts had actually taken effect. The appellate judges, from the U.S. Court of Appeals for the District of Columbia Circuit, affirmed that decision Tuesday.”
“Novartis, the Swiss drugmaker, said Wednesday that it would not raise prices on its products in the United States for the rest of 2018, joining Pfizer, which delayed its increases last week after President Trump singled out the company for criticism. Novartis’s chief executive, Vas Narasimhan, said during an earnings call with investors that the company had made the decision in June, amid escalating outrage over high drug prices. “We thought that was prudent, given the dynamic environment we’re currently in,” he said. A spokesman for Novartis said the company notified the state of California, which has a new drug-price transparency law, of its decision in June, but the news was not widely known. Pharmaceutical companies are scrambling to stem the groundswell of criticism over steep drug pricing, as elected officials and the Trump administration have taken up the issue.”
“The health department has quietly dipped into tens of millions of dollars to pay for the consequences of President Donald Trump’s border policy, angering advocates who want the money spent on medical research, rural health programs and other priorities. The Department of Health and Human Services has burned through at least $40 million in the past two months for the care and reunification of migrant children separated from their families at the border — withhousing costs recently estimated at about $1.5 million per day. The ballooning costs have also prompted officials to prepare to shift more than $200 million from other HHSaccounts, even as the White House weighs a request for additional funding for the Department of Homeland Security — a politically explosive move almost certain to antagonize fiscal hawks in the run-up to the midterm elections.”
“CVS Health Corp.’s proposed acquisition of insurer Aetna Inc. could attract the attention of the Justice Department because it appears likely to reduce competition in at least some of the Medicare prescription drug plan markets in which the two companies currently compete. It would not only be a merger between the nation’s largest health insurer and its second largest pharmacy benefit manager and pharmacy chain, it would also be a merger between two major Medicare prescription drug plan administrators. As the Justice Department weighs the deal, antitrust enforcers could be concerned that both companies sell Medicare Part D prescription drug plans to seniors. According to Bloomberg Intelligence analysts, a merged CVS-Aetna would account for 33 percent of the Medicare Part D market. The accompanying graphics show the merger could have a big impact on Middle America. In many counties, a merger would mean that more than half of the Medicare beneficiaries enrolled in a Part D plan would be the conglomerate’s customers. In McPherson County, Neb., 100 percent of people enrolled in Medicare prescription plans would have coverage through CVS-Aetna.”
July 13, 2018
Two big much anticipated Medicare payment regulations were released this week by the Centers for Medicare and Medicaid Services (CMS). The physician fee schedule proposed rule is attempting to scale back the amount of documentation physicians need to provide for payment in an effort to streamline the Medicare program to allow doctors to spend less time on compliance and more time with patients. The proposal was met by cautious optimism from physician stakeholders. The End-Stage Renal Disease (ESRD) proposed rule contained some changes for reimbursement for durable medical equipment. The competitive bidding for durable medical equipment was put on hold for 2019 while CMS contemplates reforms to the program.
The Ways and Means Committee reported out four bills this week to expand the use of health savings accounts (HSAs). The measures allow Medicare beneficiaries to continue to contribute to their accounts. Other provisions of these bills allow more services, treatments and over-the-counter drugs to be covered by HSAs. These proposals met sharp criticism from committee Democratic Members who charge that these policies will encourage the sale of more high-deductible low-value plans and create incentives for insurance companies to pull back from the Affordable Care Act (ACA) marketplaces. The committee also approved bills to postpone the ACA employer mandate and delay the so-called Cadillac tax the ACA imposed on high cost plans.
One of the Federal Communications Commission (FCC) Commissioners floated the idea of creating a $100 million pilot program to fund telehealth services for low-income Americans after they are discharged from hospitals or clinics. The FCC will consider this proposal at their next meeting in early August.
The House Appropriations Committee approved the Labor-HHS appropriations bill this week. The committee approved several amendments aimed at how HHS is handling the situation with the migrant children separated from their parents. Republicans on the committee were successful in defeating amendments offered by Democratic Members seeking to restore funding for the Title X program and to authorize the Centers for Disease Control (CDC) to study gun violence. Earlier this year the committee had clarified that CDC is permitted to conduct this kind of research but there currently lacks any funding or authorization for them to conduct those studies.
There is new attention around the so-called Stark law which is the anti-kickback law enacted by Congress in 1989. Critics of the law believe it is serving as an impediment to innovative ways to better coordinate care. CMS is convening an inter-agency panel to review the law to see if it is presenting unnecessary regulatory barriers to better more coordinated care. The Ways and Means Committee’s Health Subcommittee also announced a hearing next week to review the laws as well.
We are sure there will continue to be scrutiny over the healthcare cases that came before President Trump’s nominee for Associate Justice on the Supreme Court Brett Kavanaugh. Judge Kavanaugh has had cases involving abortion, contraception and the ACA’s individual mandate come before him on the D.C. Circuit Court of Appeals.
“The Trump administration’s latest blow to Obamacare is rattling health insurers as they draw up rate proposals, sparking new worries about huge premium increases just before midterm elections. The administration’s decision to freeze a $10 billion program designed to protect insurers from big losses in Obamacare injected more volatility into insurance marketplaces, which President Donald Trump’s health department has sought to undermine. And the move swiftly drew new warnings from insurers that higher premium increases could soon follow when enrollment reopens in November. This decision really does add uncertainty in the marketplace and could impact rates,” said Kris Haltmeyer, vice president of legislative and regulatory policy at the Blue Cross Blue Shield Association, who urged the administration to quickly reinstate the program. Obamacare insurers again have already proposed double-digit rates hikes on average for the 2019 enrollment season starting in November. Many insurers have said the administration’s attacks on the law, from killing the individual mandate to boosting skimpier health plan alternatives, are contributing to higher prices.”
“Spooking House conservatives and risking a presidential veto, Senate spending leaders are proposing to blow past budget limits to fund a popular private health care program for military veterans. Minutes before they were to meet on Thursday, congressional appropriators canceled their first public conference talk that had been intended to settle differences in three of the 12 annual spending bills President Donald Trump must sign by Sept. 30 to avert a government shutdown. One of the three provides for spending on veterans. The 11th-hour cancellation came amid a cross-Congress showdown over how to pay for a program that allows some veterans to spend taxpayer money on private doctors and hospitals. The question is whether to break budget limits, known as caps, to come up with the cash.”
“The liberal base is fired up about abortion rights, but Senate Democratic Leader Charles Schumer (N.Y.) will seek to emphasize access to affordable health care as much as Roe v. Wade in the battle over the Supreme Court. In sharp contrast to the Obama era, Schumer thinks health care is the Democrats’ best weapon. By putting the charged issue of women’s reproductive rights within the broader framework of access to health care, the matter is likely to be less polarizing in red states. Ten Democrats face reelection this year in states that President Trump won in 2016, and four of those battlegrounds lean against abortion rights, according to a state-by-state survey by the Pew Research Center. Another Democratic senator, who is not up for reelection until 2020, Sen. Doug Jones (Ala.), also hails from a majority anti-abortion state. Trump announced Monday night that he would nominate Brett Kavanaugh, a judge on the influential U.S. Court of Appeals for the District of Columbia Circuit, to the nation’s highest court. By emphasizing access to affordable health care, Schumer is also making a bid for two Republican swing votes, Sens. Susan Collins (Maine) and Lisa Murkowski (Alaska), who voted against the Republican plan to repeal ObamaCare in 2017.”
“Pfizer announced on Tuesday it would postpone drug price hikes after an “extensive” conversation between the company’s CEO and President Donald Trump. “Pfizer shares the President’s concern for patients and commitment to providing affordable access to the medicines they need,” Pfizer CEO Ian Read said in a statement. The company said it would defer price increases, effective July 1, to give Trump “an opportunity to work on his blueprint to strengthen the healthcare system and provide more access for patients.” Drug prices will return to the levels they were prior to July 1 as soon as possible, according to Pfizer. The prices will remain at those lower levels until the end of the year, or until Trump’s health-care plan goes into effect — whichever comes sooner.”
“The Trump administration is once again slashing funding for a program that helps Americans sign up for Obamacare. The Centers for Medicare & Medicaid Services announced Tuesday that it would provide only $10 million for the navigator program for this fall’s open enrollment season. The move is the latest effort by the Trump administration to undermine the Affordable Care Act. This past year, navigators only received $36 million in funding, down from $63 million in 2016. The reduction was paired with a 90% cut in Obamacare’s advertising budget. The agency once again defended the decrease by saying that navigators, which usually hail from non-profit and community organizations, are not effective. They enrolled less than 1% of consumers who signed up for 2018 coverage in 34 states using the federal exchange, according to CMS. Navigators say they don’t get credit for all the consumers they help guide through the process but don’t actually sign up. Also, navigators assist people with enrolling in Medicaid, which is not reflected in the numbers. The Trump administration broadened the opportunity for private sector agents and brokers to assist consumers in signing up last fall. They assisted 42% of enrollees, the agency said.”
“The Centers for Medicare and Medicaid Services on Wednesday released proposed payment changes for durable medical equipment prosthetics, orthotics and supplies and the end-stage renal disease programs. Payments for 2019 to end-stage renal disease facilities are expected to increase by 1.7 percent compared to this year. For hospital-based ESRD facilities, CMS projects an increase in total payments of 1.8 percent, while for freestanding facilities, the projected increase in total payments is 1.7 percent. For 2019, Medicare expects to pay approximately $10.6 billion to approximately 7,000 ESRD facilities for the cost associated with furnishing chronic maintenance dialysis services.”
July 6, 2018
The Inspector General (IG) of the Department of Health and Human Services (HHS) released a report this week on opioid use in the Medicare Part D program. The study finds that nearly one third of Medicare Part D beneficiaries – 14.1 million out of 45.2 million enrolled in the program – received an opioid prescription last year. Of particular concern, 4.9 million beneficiaries received opioid prescriptions for three or more months. The IG is concerned about these numbers and whether opioids are being properly prescribed and used. Alabama, Mississippi, Arkansas and Oklahoma were the states with the highest opioid usage. The study did find examples of patients who appear to be “doctor shopping” where they received multiple prescriptions for many different providers and were having their prescriptions filled at different pharmacies. The study concludes that multiple efforts by the federal and state governments must be taken to curb overuse of opioids and mentioned that the Centers for Medicare and Medicaid Services (CMS) will be putting in place new policies next year to address overutilization in Part D.
Everyone is anxiously awaiting the release of several Medicare payment proposed rules this week. While there is no hard deadline for their release, CMS typically tries to have the rules published no later than early July to allow enough time for a 60-day comment period and their ability to respond to the comments and finalize the rule in time for the new payment systems to take effect in January. The physician fee schedule is expected to contain new quality pay provisions and the end stage renal disease rule is expected to include medical equipment bidding provisions.
The Senate Committee on Veterans Affairs announced this week it will hold a confirmation vote for Robert Wilkie on July 10th. Wilkie’s confirmation is expected to sail through the Senate as he has the backing of the Chairman and Ranking Member of the committee.
Next week, the House Energy and Commerce Health Subcommittee will be holding a hearing on the 340B Drug Pricing Program. The Health Subcommittee will learn more about a recent report by the nonpartisan Government Accountability Office (GAO) regarding lax oversight of contract pharmacies within the 340B Drug Pricing Program. The subcommittee will also get feedback on several bills and discussion drafts that would strengthen the 340B Program.
Apple is picking up its entry into the electronic health records (EHR) space. Several big health networks are signing up for a feature that allows patients to download their health records directly onto their Apple product. The Cleveland Clinic has its own health records app known as MyChart. MyChart allows patients to see upcoming and past appointments, physician notes, schedule appointments and request prescription renewals.
“As health insurers across the country begin filing their proposed rates for 2019, one thing is clear: The market created by the Affordable Care Act shows no signs of imminent collapse in spite of the continuing threats by Republicans to destroy it. In fact, while President Trump may insist that the law has been “essentially gutted,” the A.C.A. market appears to be more robust than ever, according to insurance executives and analysts. A few states are likely to see a steep spike in prices next year, but many are reporting much more modest increases. Insurers don’t appear to be abandoning markets altogether. In contrast to last year, regulators are not grappling with the prospect of so-called “bare” counties, where no carrier is willing to sell A.C.A. policies in a given area. “The market is in a better position now than it has ever been since the exchanges have opened,” said Deep Banerjee, who follows insurers for S & P Global Ratings. The companies first began selling policies in the state exchanges, or marketplaces, five years ago. After years of losses, the insurers are now generally making money.”
“Supporters of Medicaid expansion in Nebraska say they have reached their goal to become the third Republican-leaning state this year to put an initiative on the November general election ballot. The group Insure The Good Life said Thursday that more than 133,000 signatures – shattering the required 85,000 needed — will be submitted Thursday to the Nebraska Secretary of State’s office to bring healthcare to 90,000 Nebraskans via ballot measure. The Secretary of State and county clerks then have 40 days to certify the signatures, supporters said Thursday. “Nebraska has left more than $1 billion of Nebraskans’ tax dollars on the table – dollars that we send to Washington D.C. and don’t see again.” former Nebraska Senator Kathy Campbell said Thursday. “Let’s bring that money home – money that is already going to states like Arkansas, Iowa, and California.” Nebraska, Utah and Idaho could follow the lead of voters in Maine who last November voted to expand Medicaid under the Affordable Care Act via ballot initiative. These states are seeking ballot initiatives because their Republican-leaning legislatures or governors have been roadblocks to the idea.”
“Gov. Matt Bevin’s administration is cutting dental and vision coverage for nearly a half-million Kentuckians after his Medicaid overhaul plan was rejected in court. The state Cabinet for Health and Family Services calls the cuts an “unfortunate consequence” of Friday’s ruling by a federal judge who said Kentucky can’t require poor people to get jobs to keep their Medicaid benefits. U.S. District Judge James E. Boasberg’s rejection of the Republican governor’s plan to overhaul the state’s Medicaid program is a setback for President Donald Trump’s administration, which has been encouraging states to impose work requirements and other changes on the joint state and federal health insurance program for the poor and disabled. Cabinet spokesman Doug Hogan sought in a weekend statement to place the blame squarely on the judge. The ruling means there is no longer a “legal mechanism” in place to pay for dental and vision coverage for about 460,000 Medicaid beneficiaries, his statement said.”
June 29, 2018
The Senate Appropriations Committee reported out the Labor-HHS appropriations bill this week. The committee has been moving at a brisk pace and has reported out all of the appropriations bills before the July 4th recess. There is talk of pairing the Labor-HHS bill with the Defense Appropriations bill to create the next “minibus” appropriations vehicle. The House Appropriations Committee had to postpone its full committee markup of the Labor-HHS over a scheduling conflict and will consider the bill in committee after the July 4th recess.
Robert Wilkie had a smooth confirmation hearing in the Senate Veterans Affairs (VA) Committee this week. Senator Tester (D MT) who serves as the ranking Member on the committee stated that he thought Wilkie will be confirmed and that he has the “tools to do the job.” Not that there are not challenges waiting for him at the VA, but we expect his confirmation to sail through the Senate.
Senate Democrats will emphasize healthcare as they talk about the upcoming Supreme Court vacancy with the retirement of Justice Anthony Kennedy. Look for them to focus on the impact of another conservative justice on issues such as pre-existing conditions and abortion rights.
The Centers for Medicare and Medicaid Services (CMS) denied a waiver application from the state of Massachusetts to limit drug coverage in its Medicaid program. Drug manufacturers had protested the waiver application and cheered the CMS rejection of the waiver.
The newly named CEO Atul Gawande of the new healthcare joint venture between Amazon, Berkshire Hathaway, and JP Morgan Chase spoke at the Aspen Institute over last weekend and share some insights into the approach the new company will take. Gawande stated that the three biggest drivers of healthcare costs are the “middlemen”, inflated pricing and misallocated care. There is still a lot of anticipation about how this company takes shape and what new innovations it will bring.
“Online retail giant Amazon is entering the pharmacy business after months of speculation that the company could disrupt how prescription drugs are sold the same way it upended bricks-and-mortar retail. Amazon announced Thursday that it would acquire PillPack, an online pharmacy that seeks to simplify medication for people who take multiple drugs, by delivering packets with presorted doses. A person who takes five different medications each morning, for example, could receive a packet with all the pills in a single pouch, instead of having to manually sort the doses into pill boxes for each day. “I think this is a fundamental step for Amazon, to begin to attack the pharmacy industry,” said Adam Fein, president of Pembroke Consulting and an expert on the drug supply chain. “This is the beginning of the pharmacy industry shakeout. I think everyone right now is scrambling to figure out what this means for their business model.” Stock prices for major pharmacies and other companies that help deliver drugs to consumers tumbled. CVS Health, Walgreens and Express Scripts Holding opened down on the news.”
“The Trump administration on Wednesday rejected a request from Massachusetts that state officials argued would have given them more flexibility over its Medicaid program and greater negotiating power over drug companies. The state’s Health and Human Services department asked the administration to approve a plan that would have allowed the state to limit what drugs would be covered in its Medicaid program. Currently, states are required to cover almost all drugs approved by the Food and Drug Administration, but states are looking for new ways to cut down drug prices as Medicaid costs continue to eat up state budgets. While drug manufacturers provide deep discounts to states and the federal government in exchange for having their drugs covered by Medicaid, states argue these rebates, which are a set percentage of a drug’s list price, are no longer enough sufficient as drug costs keep rising. In an effort to reduce what the state is spending on prescription drugs through Medicaid, the state asked the administration if it could exclude coverage of drugs that aren’t cost effective and have little evidence of actually working. But the administration ruled that the proposal goes against federal law. The Trump administration told the state that if it wanted to pick and choose what drugs its Medicaid program covered, it would have to forgo those rebates and negotiate directly with drug companies.”
“Health insurers are finding success in ObamaCare this year and are planning to expand their offerings in many states, defying expert’s predictions. Insurance startup Oscar Health filed to sell ObamaCare plans in Florida, Arizona and Michigan for the first time, and will enter new markets in Ohio, Tennessee and Texas. Smaller insurers are also making moves, such as Bright Health in Tennessee and Presbyterian Healthcare in New Mexico. It will be the first time Bright Health is selling plans in Tennessee, while Presbyterian is returning to the state exchange after leaving in 2016. Experts have been hailing these developments, saying that insurers have finally figured out how to become profitable in the ObamaCare marketplace. But the success is also coming in the face of persistent GOP hostility toward the health-care law and brings the risk of double-digit premium hikes for customers.”
FDA approves first cannabis-based drug- CNN (June 25th)
“The US Food and Drug Administration approved a cannabis-based drug for the first time, the agency said Monday. Epidiolex was recommended for approval by an advisory committee in April, and the agency had until this week to make a decision. The twice-daily oral solution is approved for use in patients 2 and older to treat two types of epileptic syndromes: Dravet syndrome, a rare genetic dysfunction of the brain that begins in the first year of life, and Lennox-Gastaut syndrome, a form of epilepsy with multiple types of seizures that begin in early childhood, usually between 3 and 5. “This is an important medical advance,” FDA Commissioner Dr. Scott Gottlieb said in a statement Monday. “Because of the adequate and well-controlled clinical studies that supported this approval, prescribers can have confidence in the drug’s uniform strength and consistent delivery.” The drug is the “first pharmaceutical formulation of highly-purified, plant-based cannabidiol (CBD), a cannabinoid lacking the high associated with marijuana, and the first in a new category of anti-epileptic drugs,” according to a statement Monday from GW Pharmaceuticals, the UK-based biopharmaceutical company that makes Epidiolex.”
June 22, 2018
On Tuesday the Department of Labor (DOL) issued the final rule for association health plans. President Trump issued an executive order on October calling on his administration to make it easier to form association health plans to help lower health care costs. Under previous guidance from DOL small businesses had to demonstrate a much greater “commonality of interest” to pool together to offer their employees group health plans. The new regulation makes it much easier for small businesses and sole proprietors to come together to form a group health insurance plan. For example, the rule allows for small businesses can join together to form a group health plan if they are located in the same metropolitan area. The rule allows plans formed under the previous the guidance to continue to operate under that guidance and not comply with the new regulation.
Under the regulation, small businesses can either purchase group health plans or self-insure their group health plan. Since these plans are group plans they do not have to comply with the essential health benefits requirement of the Affordable Care Act (ACA). At least two state Attorney Generals have stated they plan to challenge the new rule in court as they are concerned about healthier individuals being drawn out of the ACA marketplaces for lower cost non-ACA compliant plans. Avalere Health projected that 3 million people would leave the ACA exchanges based upon the proposed rule.
Dr. Atul Gawande was named as the new chief executive of the new healthcare venture being formed by Amazon, Berkshire Hathaway, and JP Morgan Chase. It is an interesting choice as Dr. Gawande is an accomplished Harvard surgeon and prolific writer on healthcare but has no experience managing a large organization. The new organization will be based in Boston and Dr. Gawande has no plans to leave Harvard or stop writing for the New Yorker magazine.
The House continues its push on the opioid epidemic. The House approved more than 15 bills this week including H.R. 6 which is a more comprehensive bill made up of a number of other outstanding House bills. The rule the House passed for H.R. 6 also instructs the Clerk of the House to add the legislative text of three previously passed House bills to the text of H.R. 6.
The Office of Management and Budget (OMB) released a plan to reorganize the federal government. As we speculated earlier, the OMB plan calls for consolidating the Supplemental Nutrition Assistance Program (SNAP) and the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) into the Department of Health and Human Services and renaming the agency the Department of Health and Public Welfare. Other notable reforms include merging the Departments of Education and Labor into a new agency entitled the Department of Education and the Workforce. These proposed changes will require congressional approval. Given the limited amount of time on the legislative calendar before the election, we are not anticipating congressional action on this plan in the immediate future.
“The Trump administrationtook the final step Tuesday in its plan aimed at making health insurance policies cheaper for some small businesses. The administration released its final rule governing association health plans, which allow small businessesand the self-employed to band together based on their industry or location and buy health insurance. The rule stems from an executive order that Trump signed in October aimed at providing alternatives to the Affordable Care Act, which it is bent on dismantling. But the move is expected to weaken some of the Affordable Care Act’s consumer protections for those buying these plans and make coverage more expensive for those who remain on the Obamacare exchanges. The rule allows association health plans to be regulated in the same way as large employer policies. That would free them from having to adhere to some of Obamacare’s rules, particularly the one requiring insurers to offer comprehensive coverage. Plans can start being offered as soon as September 1.”
“Republicans on Capitol Hill are giving up on what might be their last best chance to overhaul Medicare, just as they’re losing their leading champion on the issue, House Speaker Paul Ryan. The quiet surrender on a subject that’s energized GOP fiscal hawks for the better part of a decade comes as new projections show Medicare’s trust fund in its worst shape since the recession, partly because of Republicans’ other chief obsession: their sweeping tax cuts. That’s left conservatives unsure how to agitate for a politically unpopular Medicare overhaul — one that President Donald Trump detests — and raises new questions about who will take up the entitlement reform mantle as Ryan heads for the exits.”
“Amazon, Berkshire Hathaway and JPMorgan Chase announced the leader of their new health care company. Dr. Atul Gawande, a renowned surgeon and writer, has been named CEO of the new health care venture. Gawande practices general and endocrine surgery at Brigham and Women’s Hospital in Boston and is a professor at Harvard Medical School. He’s a staff writer for The New Yorker and has written four New York Times bestsellers. The companies’ executives, Amazon’s (AMZN) Jeff Bezos, Berkshire’s (BERK) Warren Buffett and JPMorgan’s (JPM) Jamie Dimon said in January that their companies would work together to give their combined 840,000 employees better health care choices. The CEOs hope to bring down costs, both for their workers and their companies.”
“The White House on Thursday unveiled a sweeping plan to reorganize how the federal government is structured, including controversial proposals to impose work requirements on assistance programs. “Businesses change all the time,” said White House Office of Management and Budget Director Mick Mulvaney. “Government doesn’t, and one of the things you get when you hire a businessman to become president is you bring this attitude from the private sector.” The plan touches a wide range of agencies, but one of its main proposals is to move the food stamp program, officially known as SNAP, out of the Department of Agriculture and into the Department of Health and Human Services. That department would then be renamed the Department of Health and Public Welfare. A new Council on Public Assistance would then oversee programs gathered in one place, including food stamps and Medicaid, and have the power to impose uniform work requirements in those programs, a move strongly opposed by Democrats. The reorganization plan faces tough odds in Congress, where even aside from the dispute over work requirements, any reorganization faces opposition from congressional committees that could lose power if their jurisdictions change.”
“A key Republican is touting efforts by the House to combat the national opioid epidemic, calling recent actions “rifle shots” at tackling targeted problems associated with the growing crisis. Rep. Tom MacArthur (R-N.J.), a co-chair of the House Bipartisan Heroin Task Force, said Wednesday that the more than 50 bills passed by the House in the past two weeks are key to helping stem the epidemic. “These are not funding bills,” MacArthur said at an event hosted by The Hill and sponsored by the Pharmaceutical Care Management Association. “They are policy changes, for the most part, and they deal with a range of things that all point to that prevention, treatment and recovery––there’s a number of focus just on the fentanyl crisis, which is growing.” The effort has largely been bipartisan and comes after Congress passed $6 billion over two years for mental health and to combat the opioid crisis. Democrats have sponsored and cosponsored opioid legislation, and only opposed a handful of the bills. Rep. Tim Ryan (D-Ohio) said that he’s worked with Republican Rep. Evan Jenkins (W.Va.) on legislation to tackle opioids. The crisis is hitting both red and blue areas of the country hard and has led to bipartisan work in a hyperpartisan Congress.”
The nation’s largest doctors group and an influential science paneltoday called on the Trump administration to halt its policy of separating migrant children from their families, saying it exacerbates emotional and physical stress and could create long-lasting health effects on children. The American Medical Association became the latest medical professional group to weigh in on the family separation controversy. The American Academy of Pediatrics, American Psychological Association and American College of Physicians have urged the administration to back away from its “zero-tolerance” policy, citing long-term consequences. “It is well known that childhood trauma and adverse childhood experiences created by inhumane treatment often create negative health impacts that can last an individual’s entire lifespan,” James Madara, the CEO of the physicians group, said in a letter to Attorney General Jeff Sessions, Homeland Security Secretary Kirstjen Nielsen and HHS Secretary Alex Azar. “The AMA believes strongly that, in the absence of immediate physical or emotional threats to the child’s well-being, migrating children should not be separated from their parents or caregivers.”
June 15, 2018
The opioid epidemic continues to be front and center for Congress. The House passed over 30 bills on the suspension calendar and 3 more that were a bit more contentious. The more contentious included a measure to create a demonstration program in the Section 8 housing program to set aside vouchers for people with substance abuse disorders. Another more contentious bill – the Stop the Importation and Trafficking of Synthetic Analogues Act (SITSA) – empowers the Department of Justice for setting penalties for synthetic drugs like fentanyl. While SITSA had support from the bipartisan Problem Solvers Caucus, it also had some critics on both the right and left. We are hearing that the House Leadership was planning to enroll all of these opioid bills into a single House bill before sending it to the Senate. It is possible that the Leadership will have more than one legislative vehicle to separate out the more controversial bills from the ones that easily passed the House.
A federal judge approved the acquisition of Time-Warner by AT&T this week and the expectation is this could have ripple effects in the healthcare world. The current thinking is that the approval makes it more likely the CVS’s acquisition of Aetna and Cigna’s acquisition of Express Scripts will also be approved.
The Centers for Medicare and Medicaid Services (CMS) had decided not to update the hospital quality star ratings system. Concerns were raised when a preview of the ratings had shown a big shift since December. The star ratings programs have also been rolled out to health plans in Medicare Advantage and Part D plans as well as for care settings including nursing homes and dialysis clinics.
There are some interesting developments at the intersection of technology and healthcare. Apple Watch plans to release a software update that can track tremors associated with Parkinson’s Disease. Researchers believe this can provide better insights into the disease’s progression as well as alerts about when medications have worn off. Additionally, CMS is now providing reimbursement for continuous glucose monitoring (CGMs) devices that interface with smart phones.
We are hearing the release of the final rule on association health plans is imminent. The Office of Management and Budget finished their review this week, so it should be published in the Federal Register any day now.
“Kentucky has sued Walgreens for its role in the state’s opioid epidemic. Attorney General Andy Beshear filed the suit against Walgreens for its dual role as a distributor and a pharmacy, saying it allegedly failed to monitor its own operations and shipped and dispensed large amounts of opioids. Beshear said Walgreens flooded Kentucky with opioid prescriptions at its more than 70 locations across the state, “directly contributing to the state’s drug epidemic.” The lawsuit alleges “unfair, misleading and deceptive business practices by Walgreens for excessively distributing and dispensing opioids in Kentucky and for failing to legally report to state and federal authorities the suspiciously large orders it received for prescription opioids.” A spokesman for Walgreens Boots Alliance declined to comment on pending litigation.”
“Increases in health-care costs and policy changes are driving ObamaCare premium increases for the 2019 plan year, according to a new report released Wednesday. The American Academy of Actuaries says that the elimination of the individual mandate penalty and the expansion of cheaper health plans with fewer benefits will contribute to premium increases next year. “The individual market, which had shown signs of stabilizing, now faces a potential deterioration of the risk pool due to policy changes that reduce incentives for healthy individuals to enroll in [ObamaCare] marketplace plans. This deterioration and other factors could drive premiums higher for 2019,” said senior health fellow Cori Uccello. Several insurers seeking rate increases for next year have cited the repeal of the mandate penalty as a primary reason for the request. “Eliminating the penalty is expected to increase premiums as unsubsidized lower-cost healthy individuals will be more likely to forgo coverage,” the brief says. The Trump administration is expected to roll out changes this summer that would expand access to short-term, limited-duration plans and association health plans.”
“New York doctors who received payments from pharmaceutical companies that make opioids were more likely to prescribe the drugs to their patients, according to a new report from the New York State Health Foundation. The findings — similar to the results of a national investigation done by CNN in March — increase concern that money from pharmaceutical companies influences doctors’ prescribing habits. “It’s a systemic issue that is troubling and needs to be addressed,” said David Sandman, chief executive of the New York State Health Foundation, which issued the report. “It’s financial relationships that really raise eyebrows.” Doctors’ groups have denied that payments from pharmaceutical companies — which are legal — influence their prescribing habits.”
“President Donald Trump’s top health care official is lowering expectations that drug companies will soon announce huge price cuts, undercutting Trump’s recent claims that his drug pricing plan would produce immediate results. Trump on May 30 said some of the largest pharmaceutical companies would announce “voluntary massive drops in prices” within two weeks in response to his drug pricing plan released in mid-May. Wednesday will mark two weeks since Trump’s remarks, which drugmakers at the time said caught them by surprise. HHS Secretary Alex Azar told the Senate HELP Committee Tuesday morning that there are “several drug companies that are looking at substantial, material decreases in drug prices,” but he indicated it could take time for the cuts to happen. Azar did not say which companies were considering cuts or how deeply they would slash prices.”
“Health plans intent on driving down costs are zeroing in on emergency room visits – one of the biggest drivers of medical inflation but a category of care that’s seldom been subject to denials. Anthem, the country’s largest Blue Cross Blue Shield plan, shook the market last year by refusing to pay for some ER visits it deemed unnecessary, triggering heated battles with hospitals and doctors and fueling a broader debate over whether patients can find less expensive settings without putting their health at risk. Since then, Blue Cross Blue Shield of Texas has adopted a similar policy limited to patients with HMO plans at out-of-network hospitals. And UnitedHealth Group, the country’s largest insurer, is using its own methodology to scrutinize if hospitals are charging too much for emergency care. If it concludes they are, UnitedHealth won’t cover the full amount of the claim.”
June 8, 2018
The Department of Justice (DOJ) filed a brief in the lawsuit being brought by the state of Texas and 19 other Republican led states to challenge the constitutionality of the Affordable Care Act (ACA) now that the tax penalty for the individual mandate has been repealed. The brief argues that when the tax penalty is taken off the books on January 1, 2019 the individual mandate will be unconstitutional. Further, DOJ believes the guaranteed issue and community rating are inseverable from the mandate and should also be ruled unconstitutional. California and 16 other states have sought to intervene in the case and protect the law. It is not clear how far this court case will advance at this point.
Congress continues to make fighting the opioid epidemic a big priority. The House is scheduled to take up more than 20 bills on the floor next week. Some of these bills will easily pass the House and will likely be placed on the suspension calendar while a few others will require a Rule for consideration. And the Senate Finance Committee will be marking up a package of 22 bills.
The Trump Administration is considering changing the name of the Department of Health and Human Services (HHS). They are also considering consolidating some other income support programs in the agency like the Supplemental Nutrition Assistance Program (formerly known as Food Stamps). HHS had previously had the word “welfare” in its title when it was the Department of Health, Education, and Welfare. It is not clear at this point what the new name will be. Many of us remember the shock waves that were sent when Tom Scully changed the name of the Health Care Financing Administration to the Centers for Medicare and Medicaid Services (CMS).
Accountable Care Organizations (ACOs) are under scrutiny from the Trump Administration. In rare public comments, a senior official from the Office of Management and Budget (OMB) Joe Grogan stated that ACOs need to take more risk sooner. There is a pending regulation altering the Medicare ACOs under review at OMB.
CMS rolled out a new scorecard for the Medicaid and CHIP programs. The scorecard will rate each state based upon their performance on a series of quality measures. The National Association of Medicaid Directors (NAMD) has concerns about the comparability, timeliness and accuracy of the data that is being reported. NAMD wants to work with CMS to refine the measures.
- House set to vote on more than 20 bills to combat opioid addiction- CNN (June 8)
“House is set to vote on more than two dozen bills next week aimed at fighting the opioid crisis, including policy changes to educate pharmacists, coordinate a national response and empowering the federal government to create a program to test alternative treatments. The House will vote individually on dozens of bills over the weeks of June 11 and June 18, a Republican aide on the House committee on Energy and Commerce told CNN. It’s the latest effort to tackle the crisis following the Comprehensive Addiction and Recovery Act and the 21st Century Cures Act, as well as the $4 billion appropriated in the omnibus this year. While the final details are still being worked out, the House will combine most of the bills into a more streamlined package before sending it over to the Senate for consideration, the aide said.”
- Trump admin tells court it won’t defend key provisions of the Affordable Care Act – CNN (June 8)
“The Trump administration won’t defend central provisions of the Affordable Care Act, saying in a legal filing Thursday night that key parts of the Affordable Care Act should be invalidated and that the individual mandate is unconstitutional. The filing came in a lawsuit brought by the state of Texas and a coalition of other Republican-led states who have filed suit in the United States District Court for the Northern District of Texas challenging the constitutionally of the Affordable Care Act. The states argue that after Congress eliminated the penalty for the individual mandate last year, effective in 2019, it destabilized other sections of the law. “In its filing the DOJ said that it agrees with Texas that the individual mandate is now unconstitutional and therefore it will not defend key provisions of the law in the suit,” said Timothy Jost, of Washington and Lee University School of Law. The provisions DOJ says should be invalidated are central to the ACA and would gut protections for those with pre-existing conditions.”
- Poll: Health care a top issue for voters ahead of midterms – The Hill (June 7)
“More than 1 in 5 voters, 22 percent, said in a new NBC News–Wall Street Journal poll that health care is their top issue in the November midterm elections. The economy and jobs followed at 19 percent, with guns at 13 percent, taxes, and spending at 11 percent and immigration at 10 percent. The poll found Democrats are more likely to consider health care a top issue. Thirty-two percent of Democrats said health care was a top issue for them, while 17 percent said guns. Twenty-six percent of Republicans said the economy and jobs are top issues for them in November, while 15 percent pointed to taxes and spending.”
June 1, 2018
The state of New Jersey also acted on a big health initiative with the Governor signing into law an individual mandate for health insurance coverage. The tax bill signed into law last year repealed the tax penalty to enforce the individual mandate from the Affordable Care Act so states are looking to state law for ways to continue or boost insurance coverage levels.
- Virginia General Assembly approves Medicaid expansion to 400,000 low-income residents- Washington Post (May 30)
“The Virginia legislature voted Wednesday to make government health insurance available to 400,000 low-income residents, overcoming five years of GOP resistance. The decision marks a leftward shift in the legislature and an enormous win for Gov. Ralph Northam (D), the pediatrician who ran on expanding access to health care.”
- Healthcare price transparency in U.S. not improved in recent years- Reuters(May 31)
“Although government measures and healthcare industry initiatives have tried to make prices more accessible to U.S. patients recently, researchers say there has been little improvement. In a follow-up to a 2011 study, researchers canvassed hospitals and surgeons trying to get price quotes for a full hip-replacement surgery. In less than half of cases, they got a complete or partial price for the procedure – and the number of hospitals that could provide any price information dropped from 48 percent to 21 percent from the first study to the second one.”
- Trump signs ‘Right to Try Act’ aimed at helping terminally ill patients seek drug treatments- CNN (May 30)
“President Donald Trump signed the “Right to Try Act” Wednesday, a measure aimed at helping terminally ill patients access drug treatments that are yet to be fully approved by the Food and Drug Administration. Trump, at a White House ceremony surrounded by patients and families who will be affected by the legislation, said his administration ‘worked hard on this’ but said repeatedly he didn’t understand why it hadn’t been done before.”
- Trump taps O’Rourke as acting VA secretary ahead of Wilkie confirmation – Politico (May 30)
“President Donald Trump has tapped longtime Veterans Affairs official Peter O’Rourke as the agency’s acting secretary, the White House announced Wednesday, a move that comes ahead of the confirmation hearing of VA secretary-designate Robert Wilkie.”
- New Jersey governor signs health-care mandate into law after federal repeal- The Hill (May 31)
“New Jersey Gov. Phil Murphy (D) on Wednesday night signed into law a bill imposing an individual mandate for health insurance to replace a federal requirement that Congress repealed. The move makes New Jersey the second state to require health-care coverage and impose a penalty on residents without it. Massachusetts imposed the requirement as part of its health reform law in 2006.”
- Democratic governors threaten to sue over Trump abortion rule- NBC News(May 31)
“Democratic governors are threatening to sue the Trump administration over a proposed rule that would force Planned Parenthood to give up its federal grants or keep family-planning and abortion-related services under different roofs. ‘If this reckless policy is finalized as written, we will have no choice but to explore all possible avenues, including legal options, to block it from harming the women in our states,’ Washington Gov. Jay Inslee and 13 fellow members of the Democratic Governors Association wrote in a letter to Health and Human Services Secretary Alex Azar. ‘Our voices will be heard on this damaging proposal, and we are prepared to match our words with action.'”
- Number of opioid prescriptions falls for fifth year in a row (May 31)
“The number of opioid prescriptions issued nationwide has dropped by 22 percent between 2013 and 2017, which a doctors group touted as progress in fighting the epidemic of opioid addiction. The report from the American Medical Association (AMA) finds there were 55 million fewer prescriptions over that time period and the number of prescriptions has dropped for five years in a row.”
May 25, 2018
This week the Senate passed the VA Maintaining Internal Systems and Strengthening Integrated Outside Networks (VA MISSION Act) and sent the bill to the President for his signature. This legislation provides the funding necessary to continue to fund the Choice Program to continue until the new community care program authorized by the MISSION Act is put in place. The bill also creates a presidential commission to review underperforming VA facilities for closure. It also expands the VA caregivers program so veterans from all eras can benefit from the program not just those from the post 9-11 era.
The House passed and sent to the President the so-called “Right to Try” legislation that will allow patients with terminal diseases the right to try experimental drugs not yet approved by the Food and Drug Administration. The President is expected to sign the bill next week and given how much he has promoted this policy we will likely see a significant signing ceremony event at the White House.
Congress continues its diligent work on the opioid epidemic with additional committees taking action. The Senate Judiciary Committee approved five bills to address the problem with solutions ranging from granting greater authority to the Drug Enforcement Administration (DEA), to reauthorizing the Office of Drug Control Policy, to closing a legal loophole around synthetic drugs. The Senate Finance Committee also announced plans to take action soon on 22 opioid related bills.
The Congressional Budget Office (CBO) released a report on Wednesday review the federal programs that provide subsidies for health insurance for individuals below the age of 65. One finding popped out is that CBO lowered its estimate for the number of uninsured because of the repeal of the individual mandate in last year’s tax bill. CBO lowered their projection by about 5 million people however also projects the number of uninsured will raise by about 5 million by the year 2027.
The House Energy and Commerce Committee’s Health Subcommittee held a hearing on legislation to reauthorize the Children’s Hospital Graduate Medical Education program. Former Energy and Commerce Committee Fred Upton noted at the hearing that only a few years ago there was bicameral and bipartisan support to scale back graduate medical education programs as this was one of the areas of agreement the on which the so-called Super Committee found agreement. However, we expect this reauthorization to be approved by Congress this year.
“HHS 340B rule delay would put hospitals at risk for high drug prices” – Modern Healthcare (May 24)
“Safety-net hospitals urged HHS not to postpone a rule setting new ceiling prices for the 340B drug discount program, saying the delay would leave them defenseless against rising costs. Although HHS was supposed to set ceiling prices starting July 1, the agency wants to hold off on the rule for a year. The request is the fifth time the rule has been postponed, and providers had until Tuesday to comment on the proposal. Hospitals that provide a significant amount of care to low-income patients or serve rural communities are eligible for 340B drug discounts. These hospitals also tend to have high amounts of uncompensated care and an increased chance of negative operating margins, according to Michael Rodgers, senior vice president at the Catholic Health Association.”
HHS Sec. Azar will testify at the June 12 Senate HELP Committee hearing” – The Hill (May 24)
“President Trump’s top health official will testify at a Senate hearing next month about the president’s proposal to reduce prescription drug costs. Health and Human Services Secretary Alex Azar will testify at the June 12 Senate Health, Education, Labor and Pensions Committee hearing, the first time lawmakers will publicly examine Trump’s plan, which was unveiled earlier this month. Committee Chairman Lamar Alexander (R-Tenn.) did not indicate whether the hearing will result in legislation.”
“House passes Trump-backed drug bill, letting sick patients bypass FDA” – Politico (May 22)
“House lawmakers on Wednesday overwhelmingly passed legislation expanding veterans’ access to private care at taxpayer expense, a campaign promise of President Donald Trump, and adding more money to the “Choice program” weeks before VA officials said it could run out of money. The $51 billion plan that passed 347-70 Wednesday includes $5.2 billion for the VA Choice program that funds private care. VA officials have warned that the program could run out of money as early as the end of the month, disrupting care for patients.”
May 18, 2018
The House Ways and Means Committee reported 7 bills in the continued legislative effort to address the opioid epidemic. While some of the Members expressed frustration that the committee was not doing enough to really tackle the crisis, all the measures were reported out on voice votes. Six of the measures sought to make improvements in the Medicare program to better handle the problem with solutions ranging from better coverage of opioid treatment programs, to requiring electronic prior authorizations for opioid subscriptions covered under Medicare Part D, to requiring the Department of Health and Human Services (HHS) to develop guidance for pain management and opioid abuse prevention.
The Energy and Commerce Committee reported 33 additional opioid bills. Most of the bills were reported unanimously but two bills proved to be more contentious. There was some division on the committee over the bills to allow Medicaid reimbursement for inpatient drug treatment and the bill to ease the current restrictions on sharing substance abuse records among physicians and hospitals.
The House is expected to consider all the reported opioid bills in early June. It is not yet clear whether some of these bills will be packaged before consideration on the House floor.
The Trump administration was busy this week moving forward with the plans the President laid out last Friday to help lower prescription drug prices. The Centers for Medicare and Medicaid Services (CMS) updated its drug pricing dashboard to include year-over-year pricing data on pharmaceuticals. CMS Administrator Seema Verma also issued a letter to all Part D plans stating that the administration finds any “gag orders” that some insurance plans and pharmacy benefit managers include in their contracts with pharmacies to be unacceptable.
HHS Secretary Azar announced during a speech on Monday morning that the agency will be issuing a request for proposals on a new pricing mechanism for drugs covered under Medicare Part B known as a Competitive Acquisition Program. Secretary Azar also revealed plans to review drugs they will seek to cover under Medicare Part D rather than Part B and eventually merging the two programs.
The House is also expected to consider next week the so-called “Right to Try” legislation that passed the Senate last year. The bill sponsored by Senator Johnson (R WI) allows patients to use medications not yet approved by the Food and Drug Administration. The House had try to narrow the scope of the bill by passing a measure to allow for unapproved drugs to be used by terminal patients but that bill did not gain any traction in the Senate. The President strongly supports the Johnson bill including a shout out during his State of the Union address and during his press conference on drug pricing last week.
- “Trump nominates Robert Wilkie as VA secretary” – CNN (May 18)
“President Donald Trump announced Friday that he is nominating Robert Wilkie to lead the Department of Veterans Affairs, three weeks after his previous nominee withdrew from the confirmation process amid controversy. Wilkie is currently the undersecretary of defense for personnel and readiness but has been serving as the VA’s acting secretary since the President fired VA Secretary David Shulkin in late March. But Trump said the announcement came as a surprise even to Wilkie.”
- “Trump to target Planned Parenthood with new abortion curbs” – Politico (May 18)
“The Trump administration is expected to announce as soon as Friday that it will dramatically change the federal family planning program to prohibit health care providers who accept the funds from making referrals for abortion — a step that could effectively cut off millions of dollars to Planned Parenthood. The changes to the Title X program, which are expected to be announced in new regulations, would mark the Trump administration’s latest win for social conservatives who are looking to prohibit access to abortion.”
- “House votes to expand veterans’ access to private care” – CNN (May 17)
“House lawmakers on Wednesday overwhelmingly passed legislation expanding veterans’ access to private care at taxpayer expense, a campaign promise of President Donald Trump, and adding more money to the “Choice program” weeks before VA officials said it could run out of money. The $51 billion plan that passed 347-70 Wednesday includes $5.2 billion for the VA Choice program that funds private care. VA officials have warned that the program could run out of money as early as the end of the month, disrupting care for patients.”
- “House to vote to send ‘right to try’ bill to Trump’s desk next week” – The Hill (May 17)
“The House will vote next week on Senate-passed legislation aimed at making it easier for sick patients to access experimental drugs — a big priority for President Trump, Vice President Pence and groups backed by conservative mega-donors Charles and David Koch. ‘This will not only offer a chance for the patient to possibly find treatment but could open possibilities to help others do the same,’ House Majority Leader Kevin McCarthy (R-Calif.) said in a statement. In August, the Senate passed Right to Try by unanimous consent. The bill, which Sen. Ron Johnson (R-Wis.) championed, lets sick patients request access to treatments the Food and Drug Administration (FDA) hasn’t yet approved.”
- “Stack of opioid bills advance out of key panel” – Washington Examiner (May 17)
“The House Energy and Commerce Committee on Thursday advanced 32 bills targeting the opioid crisis to the full House for a vote. The bills advanced after a marathon markup that lasted seven hours. Another package of 25 bills advanced out of committee earlier this month. ‘We have a unique opportunity to save lives, and we can’t lose sight of the real-world impact of our actions throughout this process,” said committee Chairman Greg Walden, R-Ore. “We owe it to the families of the more than 115 Americans who die from opioids every single day to come together and advance legislation that can help stem this tide.’”
May 11, 2018
President Trump just delivered his much anticipated speech on drug prices. Joined by Health and Human Services Secretary Alex Azar, the President talked about more negotiation, more competition and eliminating the middle men. Secretary Azar said there would be 50 actions HHS will take as part of their blueprint for lowering drug prices (for the full text of the blueprint click here). One action Azar mentioned was having the Food and Drug Administration (FDA) require pharmaceutical companies to include prices in their direct to consumer advertising.
The House Energy and Commerce Committee reported out 25 bipartisan opioid bills on Wednesday. Each bill cleared the committee on a voice vote. The committee plans to mark up more opioid bills next week as the Health Subcommittee had reported 63 bills during the last week in April. The expectation is these bills will be voted on in the House in early June.
Senator Alexander (R-TN) has stated that the Senate will wait for the House to act before calling up their opioid bill. While the Senate bill had broad bipartisan support in the Senate Health, Education, Labor, and Pensions (HELP) Committee, the committee did not take up some of the more contentious issues such as assessing fees to the manufacturers of opioids. It is not yet clear whether the Senate will reach an agreement on limitations for debate and amendments on the Senate floor to pass a bill.
The largest distributors of prescription drugs faced a difficult hearing this week as well. Representatives from McKesson, Cardinal Health, and AmerisourceBergen faced some difficult questions and statements from Members on the Energy and Commerce Committee.
The President sent to Capitol Hill the largest rescission package ever totaling $15.4 billion. Prime Policy Group published their analysis of the package on Tuesday which you can read here. There are a few notable rescissions in healthcare. The President proposed rescinded unspent monies from the Childrens’ Health Insurance Program (CHIP). What is interesting to note is that CHIP is a mandatory spending program. Rescission authority written into the Congressional Budget and Impoundment Control Act was intended for Presidents to be able to rescind discretionary funding appropriated by the Congress.
However, our reading of the law suggests that the letter of the law is silent on whether the funds are mandatory of discretionary. Senators will likely appeal to the Senate Parliamentarian arguing that the mandatory spending rescissions are not privileged and she will be listening to Senators on both sides. Also of note the President proposed rescinding funding from the Centers for Medicare and Medicaid Innovation (CMMI). While created by the Affordable Care Act, CMMI was exploring payment options supported by both parties.
The Centers for Medicare and Medicaid Services (CMS) released an interim final rule on Wednesday providing some targeted additional payments for suppliers of durable medical equipment such as oxygen for a six-month period. The rule had been pending at the Office of Management and Budget since September of last year. Secretary Azar testifying before the Senate Appropriations Committee was pressed about what the administration will do about reimbursement beyond the six months.
“Health care stocks whipsawed on Friday as President Trump unveiled his long-awaited plan to lower prescription drug prices, dubbed “American Patients First.” The sector briefly turned negative before trading 1.6 percent higher. Shares of Express Scripts and CVS both hit session lows before rising 3.7 percent and 3.8 percent. Dow Jones industrial average components Merck and UnitedHealth also dipped before trading higher upon the announcement. The proposal seeks to boost competition, improve negotiation and create incentives to lower list prices of prescription drugs and lower out-of-pocket costs for consumers. It stopped short of allowing Medicare to directly work with manufacturers on prices.”
“President Donald Trump wants Americans to get lower prices for medicines — and the rest of the world may pay for it. His “America First” message on drugs at home, coupled with pro-pharmaceutical industry policies abroad, could lead to higher costs for patients around the world — without making drugs more affordable for those in the U.S. Trump on Friday plans to deliver his long-promised speech on how to lower drug costs, addressing an industry he has in the past accused of “getting away with murder.” Global health officials worry he will also target practices that keep medicines affordable in other countries. Amid rising trade tensions between the U.S. and key trading partners, Trump and top administration officials have repeatedly blamed high U.S. prices in part on foreign countries that take advantage of the significant U.S. investment in medical research without paying their fair share. Many nations, including wealthy European ones, negotiate or regulate drug prices to keep them lower than what Americans typically pay.”
“President Donald Trump is looking to cut $15.4 billion out of the $1.3 trillion federal spending bill approved in March, using a process called rescission. Rescission withdraws spending authority for funds appropriated but not spent. Appropriated funds to the Centers for Medicare and Medicaid Innovation, or CMMI, and the Children’s Health Insurance Program would be cut. The Department of Health and Human ServicesCHIP program is targeted to lose $7 billion and the proposal would rescind $800 million to the innovation center.”
May 4, 2018
The President is going to give his much anticipated speech on drug pricing on Tuesday. Food and Drug Administration (FDA) Commissioner Scott Gottlieb may have given an indication of where the President will go on Tuesday when he remarked at a speech this week that it may be worth examining the safe harbor drug rebates have under anti-kickback laws. Drug makers have long pushed for having pharmacy benefit managers and insurance companies to pass along more of the negotiated rebates to consumers.
The three federal agencies declined to make significant changes in the rule for health insurance coverage of out-of-network emergency services. The final rule states that the plan satisfies the Affordable Care Act’s (ACA’s) copayment and coinsurance limitations if it pays the provider the greater of three amounts – 1. the same as the negotiated price for in-network providers; 2. the Medicare payment amount; or 3. the same amount as calculated for other out-of-network providers. This “greatest of three” or “GOT” method was originally put in place in 2015.
Centers for Medicare and Medicaid Services (CMS) Administrator Seema Verma defended the actions of the Trump administration around the ACA. In a speech before the World Health Care Congress, Administrator Verma claimed the law was broken before he took office. Verma also pointed to the administration’s proposed rule on short-term insurance plans that are not ACA-compliant saying extending the plans duration to one year will help to lower the cost of plans available to consumers.
“U.S. Food and Drug Administration chief Scott Gottlieb on Thursday questioned whether rebates that drugmakers provide to health insurers should remain protected by federal law, sparking new concerns on Wall Street over efforts to curb drug pricing. Gottlieb was referring to the common practice of pharmaceutical companies setting a high “list price” for a drug, and then lowering the cost for health plans through hefty rebates in exchange for the broadest access to patients. In recent weeks, he has criticized these practices for keeping drug prices high and locking out competitors. “What if we took on this system directly, by having the federal government reexamine the current safe harbor for drug rebates under the Anti-Kickback Statute?” Gottlieb said in remarks prepared for a Food and Drug Law Institute conference and posted on the FDA’s website.”
“President Trump on Thursday promised he would “immediately” sign revamped legislation expanding veterans’ access to private medical care at taxpayer expense, if Congress passes a new plan being considered just weeks before the “Choice Program” runs out of money. In a tweet Thursday, the president noted that it has been four years since the wait-times scandal at a Veterans Affairs hospital in Phoenix. That controversy showed that hospital employees were lying about the amount of time veterans waited for urgent health care, including cancer treatment and mental-health counseling.”
“President Donald Trump says he’ll quickly sign legislation expanding veterans’ access to private medical care if Congress clears the plan by Memorial Day. Trump noted in a tweet Thursday that it’s been four years since a scandal at a VA hospital in Phoenix, in which some veterans died while waiting for appointments. Congress has been working on overhauling the existing “choice” program, which is running out of money. Proposals have stalled over disagreements about cost and how much access veterans should have to private doctors.”
April 27, 2018
It was a busy week for healthcare in Washington with lots of new developments and a cancelled event – the President’s postponement of his speech on drug pricing.
The opioid epidemic is clearly the largest public health threat facing the country with 42,000 lives lost in 2016 alone. The Senate Health, Education, Labor, and Pensions (HELP) Committee reported S. 2680 – the Opioid Crisis Response Act by voice vote. The bill is comprised of over 40 initiatives largely from HELP Committee Senators. Although this bill sailed through committee, there was discussion of more controversial amendments being offered on the Senate floor should Leader McConnell allocate floor time. One notable proposal is from Senator Sanders (I-VT) to impose significant fines on drug manufacturers for their role in the opioid crisis.
The Energy and Commerce Committee’s Health Subcommittee also reported 63 opioid-related bills to the full committee. While some of these proposals were non-controversial and passed with bipartisan support, Ranking Member Frank Pallone (D-NJ) expressed his frustration about the committee acting too quickly without sufficient input from the federal agencies the bills are charging with new tasks to fight the epidemic. Pallone is fearful the quick actions could end up doing more harm than good. Democrats on the committee tried to block a few of the bills but did not have the votes to stop them from moving forward.
The Centers for Medicare and Medicaid Innovation (CMMI) released a Request for Information (RFI) about a possible new payment model. The new payment model, known as direct provider contracting, would attempt to put the patient at the center of this new care model. Unlike an accountable care organization or medical home where health care providers are coordinating the care, this would rely on the patient to determine the best providers and services needed for their own care. Interested parties have until May 25 to submit responses to the questions posed in the RFI.
The President’s nominee for Secretary of Veteran Affairs (VA) Real Admiral Ronny Jackson withdrew his name from consideration. Reports surfaced about alleged activities conducted while serving as the White House Attending Physician that were giving Senators on both sides of the aisle pause about Dr. Jackson’s candidacy. There is speculation that the President will look at other healthcare leaders for the next nominee to lead the VA.
Centers for Medicare and Medicaid Services (CMS) Administrator Seema Verma made a big splash at the Health Datapalooza conference this week. Administrator Verma announced that CMS will make public data from Medicare Advantage (MA) plans. The agency will release preliminary data from 2015 plans this year. Next year CMS will also release data from the Childrens’ Health Insurance Program (CHIP) and Medicaid. It is a big day for more data transparency and health research opportunities.
- HHS proposes Medicare payment rules to encourage hospitals to be clearer about prices – Washington Post (Apr 27)
“The Trump administration is proposing to rewrite rules on federal payments to hospitals treating older Americans on Medicare, making it easier for patients to see the prices of procedures and care. As part of annual updates to Medicare payment rules, federal health officials also want to add $1.5 billion for the coming year to the funds for so-called disproportionate share payments that help buffer hospitals from the expense of treating patients who cannot pay their bills.”
- Medicare may require hospitals to share electronic records – Axios (Apr 25)
“Even though electronic health records have become ubiquitous, hospitals and doctors still have not been able to easily share medical information with each other or with patients. Tying Medicare payments to an open exchange of medical records could force the industry to solve the practice known as information blocking.”
- Drug Pricing Proposal Should Revamp Medicare, GOP Experts Say – Roll Call (Apr 25)
“The administration’s proposal is a request for comment on strategies to lower drug prices and out-of-pocket costs. It was originally expected to be released in tandem with a speech by President Donald Trump on Thursday, but the speech was delayed as Health and Human Services Secretary Alex Azar recovers from an infection.”
- Frustration grows in health care industry over costs – Axios (Apr 27)
“The next big battle in health care will almost certainly be about costs, and right now it’s largely confined to industry infighting and finger-pointing. But mounting frustration from employers and employees could put cost controls on the table faster than you might think. Frustration over health care costs is one thing. But the greater threat to the health care industry is one that’s just starting to percolate — concern that we’ve already maxed out the existing tools to control those costs.”
April 20, 2018
Next week is shaping up to be a big week for healthcare in Washington. The Senate Committee on Health, Education, Labor, and Pensions (HELP) is scheduled to markup S. 2680, the Opioid Crisis Response Act of 2018, next Wednesday. This bill is comprised of 40 different proposals mostly from Senators serving on the HELP Committee. The legislation will make changes at 5 federal health agencies: Food and Drug Administration (FDA); Centers for Disease Control (CDC); Health Resources and Services Administration (HRSA); the National Institutes of Health (NIH); and the Substance Abuse and Mental Health Services Administration (SAMHSA). However, it does not propose any changes to the Medicare and Medicaid programs which both lie in the Senate Finance Committee’s jurisdiction.
The House Energy and Commerce Committee is also marking up a legislative package of proposals next Thursday. The committee is looking to package 34 separate proposals from Members of Congress serving on the panel. The bill which has not yet been introduced is expected to – at least – temporarily repeal the restriction on using Medicaid funds for inpatient treatment of addiction. The bill is also expected to make it easier to treat opioid abuse with telehealth under the Medicare program.
The President is planning to make a speech on drug pricing next Thursday. It is also expected that we will see the release of a Notice from the Department of Health and Human Services (HHS) on a strategy to lower drug prices and reduce out-of-pocket costs. HHS submitted the draft Notice to the Office of Management and Budget this past Tuesday. The Notice is expected to be a Request for Information on how to lower drug prices and the administration is expected to take more specific actions on drug pricing this summer.
HHS Secretary Azar announced this week that James Parker will serve as his Senior Advisor for transforming our health care system to a value-based system rather than a fee-for-service system. Parker most recently served as the Chief Executive Officer of an Indiana based managed care organization MDwise, Inc.
- Trump plans first major speech on drug prices next week – Politico (Apr 16)
“President Donald Trump is set to deliver his first major speech on drug prices on April 26, revisiting an issue he campaigned on but that is unlikely to yield major legislative changes. The strategy is unlikely to call for actions of the sort Trump touted on the campaign trail like allowing the government to negotiate the cost of drugs for Medicare, but based on the president’s fiscal 2019 budget request could advocate for Medicare and Medicaid demonstrations to test new ways of paying for drugs on a smaller scale, like allowing some states to try negotiating drug costs in Medicaid.”
- NIH abruptly changes course on industry opioids partnership after ethics flags raised – Stat (April 19)
“Dozens of drug companies were on the verge of teaming up with [NIH], which researchers hope will lead to the discovery of new medicines to treat addiction or serve as alternatives to opioids. But in an abrupt shift, the agency announced late last week that it won’t accept funds from drug makers after all. Citing recommendationsissued earlier this month by an NIH advisory panel, Collins said the agency will exclusively use taxpayer money to fund a comprehensive research initiative on pain and substance use disorder treatment.
- GOP in retreat on ObamaCare – The Hill (Apr 20)
Republicans are retreating from calls to repeal ObamaCare ahead of this year’s midterm elections. Less than a year after the GOP gave up on its legislative effort to repeal the law, Democrats are going on offense on this issue, attacking Republicans for their votes as they hope to retake the House majority.
April 13, 2018
A big focus this past week was the opioid epidemic. The Energy and Commerce Committee’s Health Subcommittee held a hearing examining 34 bills that the committee hopes will shape a comprehensive legislative package the Majority is hoping to bring to the floor before the Memorial Day recess. Democratic members on the committee are concerned about the committee moving too quickly and the possibility of a partisan opioid bill if they are not earnestly engaged in the drafting of the legislation. There are a number of issues on the table including allowing Medicaid to pay for inpatient addiction treatments and tracking prescriptions electronically in the Medicare program to help prevent abuse.
The Senate Committee on Health, Education, Labor, and Pensions (HELP) released a bipartisan draft bill to address the crisis. The bill is a product of 29 proposals put forward by nearly every member of the HELP Committee. The bill seeks to give the National Institutes of Health the flexibility necessary to develop non-addictive pain killers a move that Chairman Alexander (R-TN) dubbed the “Holy Grail” of tackling the opioid epidemic. Other provisions would give the Food and Drug Administration (FDA) greater authority to require drug manufacturers to package opioids in packaging for a set duration of time like a 3 or 7-day packet and to give consumers safe ways to dispose of unused opioids.
FDA Commissioner Scott Gottlieb had some strong words about drug pricing at the Community Oncology Alliance’s meeting held in Maryland. Commissioner Gottlieb took issue with raising co-pays and co-insurance requirements that are putting patients in precarious financial situations as they are seeking treatment for their lethal diseases. The cost of pharmaceuticals is one of the top priorities for Health and Human Services (HHS) Secretary Azar and we are likely to see administrative actions to address pricing.
We are also hearing the final rule on Association Health Plans may emerge from the Department of Labor in the next month or two. It will be interesting to see how aggressive the Department of Labor will be with the final rule. It is likely that the final rule will be challenged in the courts.
- Top House, Senate Dems warn administration on short-term insurance – The Hill (April 13)
“The ranking Democrats of five House and Senate committees are calling on the Trump administration to withdraw a proposal that would expand access to plans that don’t meet ObamaCare’s consumer protection rules. Led by House Energy and Commerce Committee ranking member Frank Pallone Jr.(N.J.), the Democrats warned Health and Human Services Secretary Alex Azar and other administration officials in a Thursday letter that the rule would “encourage the sale of junk health plans that will undermine consumer protections, sabotage the Affordable Care Act (ACA) marketplaces, and expose consumers to great financial risk.””
- NIH director: Agency is looking at alcohol industry influence ‘in a very aggressive way’ – STAT (April 11)
“The controversy over research conducted by the National Institutes of Health on the health impacts of moderate drinking has reached Capitol Hill, where a lawmaker on Wednesday stridently questioned the agency’s director, Francis Collins, over the NIH’s reportedly cozy relationship with the alcohol industry. In response to a question about reports that the NIH had allowed industry partnerships to influence research into alcohol use and the impact of alcohol marketing, Collins told Rep. Lucille Roybal-Allard (D-Calif.) that the NIH is “looking into this in a very aggressive way.””
- About half of Americans support single-payer health care – Washington Post (April 12)
“As President Trump’s administration tries to chip away at the Affordable Care Act by giving more authority to states to regulate private insurance, a new poll finds a slight majority of Americans support a move in the opposite direction, with everyone getting health insurance from a national government-run program. A Washington Post-Kaiser Family Foundation poll finds a 51 percent majority of Americans support a national health plan, also known as a single-payer plan, while 43 percent oppose it.”
April 6, 2018
This week an internal memo issued by the Secretary of Health and Human Services (HHS) Alex Azar surfaced outlining how the Secretary plans to run the department. The main takeaway from this appears to be that power and influence is being consolidated under Azar’s Deputy Secretary and close confidant Eric Hargan. The two served together at HHS during President George W. Bush’s administration and are known to have a strong rapport. Under this reorganization, Deputy Secretary Hargan will be the lead on all regulatory matters and will be the primary liaison between the Office of Management and Budget (OMB) and the White House. The memo also addresses the consolidation of staff and the removal of up to 40 percent of policy staff to streamline decision making.
Secretary Azar identified his top four priorities for the department: combating the opioid crisis; bringing down the cost of prescription drugs; addressing the cost and availability of health insurance; and transforming our health care system to a value-based system. Azar is creating several “Senior Advisors” – a new position – to help guide action on each of these priorities. Two of those advisors were named (Daniel Best for drug pricing and Dr. Brett Giroir for opioids); the other two will be named soon.
If you would like a copy of the memo, please email email@example.com.
Elsewhere in healthcare, Surgeon General Jerome Adams issued a rare public health advisory this week urging friends and family of people who are at risk of opioid overdose to carry with them naloxone which is used to treat overdoses. While first responders and many police officers carry naloxone, they often arrive too late in cases of overdoses. The last public health advisory from the Surgeon General’s office came in 2005 to warn against the dangers of drinking during pregnancy. This action by the Surgeon General indicates how severe the opioid epidemic has become.
- Senate Panel Unveils Draft Bill to Combat Opioid Addiction – Roll Call (Apr 5)
“The Senate health panel on Wednesday released a discussion draft intended to curb opioid addiction. The development comes as other House and Senate committees also prepare legislation. The Senate Health, Education, Labor and Pensions Committee plans to discuss this legislation at an upcoming hearing on April 11. The panel has already held six hearings on the opioid crisis so far this Congress featuring representatives from agencies including the Food and Drug Administration, the National Institutes of Health, and the Centers for Disease Control and Prevention, as well as governors from states affected by the crisis.”
- Heller promised Obamacare repeal in Las Vegas speech to GOP club – Las Vegas Review Journal (Apr 5)
“…Heller predicted that Republicans will pick up a handful of Senate seats in the midterm elections, and that would be the path to fulfilling that long-held promise of a repeal. “I think at the end of the day we end up with 53, 54 seats,” Heller said. “If we can do that, then we can repeal and replace and change the ACA as we know it today.” Heller was not among the original supporters of Trump, and was especially critical of then-candidate Trump during the 2016 campaign season.”
- In rare advisory, surgeon general urges public to carry overdose-reversal medication – STAT (Apr 5)
“Surgeon General Jerome Adamsis issuing a rare public health advisory on Thursday, calling for friends and family of people at risk for opioid overdoses to carry the OD-reversal medication naloxone. He likened the treatment to other livesaving interventions, such as knowing how to perform CPR or use an EpiPen.”
Rich Meade, a Vice Chairman at Prime Policy Group and Chair of the firm’s Healthcare Practice has over 25 years of experience in legislative, regulatory, political and public relations strategy. He previously served as Chief of Staff to the House Budget Committee. Rich has helped his clients navigate many complex regulatory and legislative landscapes to achieve many public policy successes including transitioning to a new Medicare payment and quality system, and developing, with the Centers for Medicare and Medicaid Services (CMS) and Office of the National Coordinator for Health Information Technology (ONC), a health information exchange (HIE) on the Nationwide Health Information Network (NwHIN).
Elizabeth Hart Thompson has nearly two decades of experience as a senior staff member on Capitol Hill and a lobbyist. She joined Prime from Crossroads Strategies, where she focused on health care, financial services and technology. Building on her extensive knowledge of the political and legislative processes, as well as, her dedication to team work, Elizabeth is particularly adept at developing and executing advocacy strategies that deliver meaningful results to clients.
Mitchell has been delivering trusted counsel across a diverse practice of legislative, policy and political issues for more than a decade. During his long-standing tenure both in Congress and throughout the political and policy sphere of Washington, he has tackled some of the largest healthcare, energy and regulatory issues presented before the federal government. He has a massive range of relationships and strategic congressional partnerships has paid dividends for consecutive congressional sessions. Mitch is a member of Prime Policy Group’s healthcare practice.