Health Care Checkup: February 2, 2024

Health Care Checkup

February 2, 2023

THE BIG PICTURE: KEY CONGRESSIONAL & EXECUTIVE BRANCH DEVELOPMENTS

On Thursday, the House passed a bipartisan $79 billion tax package, the Tax Relief for American Families and Workers Act of 2024, in a 357-70 vote that pairs the renewal of business tax breaks with a child tax credit expansion. Senate Finance Chair Ron Wyden (D-OR) is pushing for the Senate to move quickly on the bill, but Senate Republicans have stated reservations over the legislation and oppose speeding up the process of bringing it to a vote.

What to Expect Next Week:

In the Senate, Senate Majority Leader Chuck Schumer announced negotiators are closing in on a border and Ukraine aid deal and plans to release the legislation to the public no later than Sunday and hold the first procedural votes on the measure no later than February 7.

The Senate HELP Committee will hold a hearing on prescription drug prices on Thursday at 10 AM, and the Senate Finance Committee will hold a hearing on AI and healthcare on Thursday at 10 AM.

In the House, the Ways and Means Committee will hold a hearing on drug shortages on Tuesday at 10 AM.

DEEP DIVE

Congressional:

House Energy & Commerce Health Subcommittee Holds Hearing on Healthcare Spending

On Wednesday, the House Energy and Commerce Health Subcommittee held a hearing on healthcare spending. Much of the discussion at the hearing centered around bipartisan support for the Lower Costs More, Transparency Act, which passed the House in December 2023 and would bolster transparency requirements for healthcare providers and insurers, among other measures. Members discussed a wide range of policy initiatives, ranging from increasing transparency across the healthcare spectrum to creating a permanent extension of the Affordable Care Act (ACA) premium tax credits, increasing Medicare Advantage regulations and oversight, promoting physician-owned hospitals, and increasing employer access to claims data. In some cases, there were differences between the priority that Republicans and Democrats on the Subcommittee placed on various proposed reforms. Read Mehlman’s hearing summary here.

Pharmaceutical CEOs Agree to Testify in Senate HELP Hearing, Avoiding Subpoena

Late last week, Senate Health, Education, Labor, and Pensions (HELP) Committee Chairman Bernie Sanders (I-VT) announced the CEOs of Merck & Co. Inc. and Johnson & Johnson agreed to testify before the HELP Committee on drug prices. As a result, the Committee will no longer hold a subpoena vote on January 31. Johnson & Johnson CEO Joaquin Duato and Merck CEO Robert Davis will testify on February 8, at 10:00 AM, joining Bristol Myers Squibb Co. CEO Chris Boerner, who had already previously agreed to appear at the hearing. Read the press release here.

Senators Push for CMS to Protect and Strengthen Medicare Advantage Ahead of Annual Update

On Monday, Senators Catherine Cortez Masto (D-NV), Tim Scott (R-SC), Gary Peters (D-MI), and Shelley Moore Capito (R-WV) led a bipartisan group of 57 Senators in a letter expressing their continued support of the Medicare Advantage (MA) program. Each year, CMS releases payment and policy updates to the MA program. The Senators’ letter urges the administration to ensure stability for the MA program, move forward with ongoing reforms to address predatory marketing practices, and encourage plan performance transparency to help consumers better assess value in the MA program. They wrote that they also want more transparency on coverage options and hope to work with the agency to take on “predatory and deceptive marketing practices” and make provider directories more accurate. Read the press release and letter here.

Representatives Robin Kelly and Troy Balderson Announce the Congressional Digital Health Caucus

On Thursday, Reps. Robin Kelly (D-IL), Chair of the Congressional Black Caucus Health Braintrust, and Congressman Troy Balderson (R-OH) announced the establishment of a Congressional Digital Health Caucus. The Caucus aims to inform policymakers of the rapid advancements in digital health innovation, highlight the potential impacts on patients and the healthcare system, and ensure the access and benefit of digital health tools. The Digital Health Caucus, composed of a bipartisan group of lawmakers, will serve as a platform for dialogue and collaboration among experts from government, the private sector, and the healthcare industry. The Caucus seeks to shape policies that support the integration of cutting-edge digital health technologies into the healthcare landscape. The caucus held its first event Thursday focused on AI and health care, featuring representatives from Google, Microsoft, and others. It also plans to focus on regulatory issues, advancing research and development in digital health, and protecting patient privacy. Read the press release here.

MACPAC Advisers Back New Protections for Medicaid Patients Denied Care

Late last week, Congress’s Medicaid advisers, MACPAC, endorsed a series of steps policymakers could take to overhaul the appeal process for beneficiaries denied coverage by a managed care organization. The proposals include allowing impartial third-party doctors to review claims in the event a claims appeal is denied by a managed care organization (MCO), asking the Centers for Medicare & Medicaid Services to issue guidance advising MCOs to craft denial forms that can be received electronically or through the mail, are written in clear language, and contain information notifying patients of their right to continue receiving services while an appeal is pending. The commission also advised that states conduct a routine audit of denials and post all data relating to denials, continuation of benefits, and appeals outcomes online. Read the proposals here.

Notable Bills Introduced:

Senate 340B Working Group Releases Discussion Draft of SUSTAIN 340B Act

On Thursday, Senators John Thune (R-SD), Debbie Stabenow (D-MI), Shelley Moore Capito (R-WV), Tammy Baldwin (D-WI), Jerry Moran (R-KS), and Ben Cardin (D-MD), members of the Senate 340B bipartisan working group released a discussion draft floating a variety of policies aimed at boosting transparency in the 340B drug discount program, including a user fee scheme that aims to create a clearinghouse to “prevent duplicate discounts and ensure proper accounting.” It also attempts to define the role of contract pharmacies in the program. Senator Thune’s (R-SD) staff said the goal is to pass legislation this Congress. Read the discussion draft here.

Reps. Harshbarger, Vargas Introduce Bill to Strengthen and Secure Medical Supply Chains

On Thursday, Representatives Diana Harshbarger (R-TN) and Juan Vargas (D-CA) introduced the United States-Abraham Accords Cooperation and Security Act, bipartisan legislation that will establish a U.S. Food and Drug Administration (FDA) Abraham Accords bureau to provide guidance and technical assistance aimed at protecting our medical supply chains and ending reliance on adversarial nations like China. Read the press release here and the bill here.

Sens. Bennet, Capito, and Reps. Sánchez, Carey Introduce Bill to Support Family Caregivers

On Wednesday, Senators Michael Bennet (D-CO), Shelley Moore Capito (R-WV), Elizabeth Warren (D-MA), Susan Collins (R-ME), Maggie Hassan (D-NH), and Lisa Murkowski (R-AK) alongside U.S. Representatives Linda Sánchez (D-CA) and Mike Carey (R-OH) reintroduced the Credit for Caring Act. This bill would provide up to a $5,000 nonrefundable federal tax credit for eligible and working family caregivers. Read the press release here and the bill here.

Senators Casey, Cassidy Introduce Legislation to Increase Bone Marrow Donations, Reduce Barriers to Donation

On Tuesday, Senators Bob Casey (D-PA) and Bill Cassidy (R-LA) introduced legislation to remove obstacles to bone marrow donation and improve the chances of finding a match for patients in need of bone marrow. The Lifesaving Leave Act will ensure potential bone marrow donors can take leave from work to undergo marrow donation activities, which could vastly expand the pool of eligible donors. Read the press release here and the bill here.

Sens. Kaine, Young, and Reps. Kiggans, Wild, Carter & Dingell Introduce Bipartisan Bill to Support Health Care Provider Mental Health

On Tuesday, Senators Tim Kaine (D-VA) and Todd Young (R-IN) and Representatives Jen Kiggans (R-VA), Susan Wild (D-PA), Buddy Carter (R-GA), and Debbie Dingell (D-MI) introduced bipartisan, bicameral legislation to reauthorize the Dr. Lorna Breen Health Care Provider Protection Act, a law to reduce and prevent suicide, burnout, and mental and behavioral health conditions among health care professionals. The law has already provided $100 million in funding for mental health care for providers across the country, but the funding provisions of the law are set to expire at the end of this year. The Dr. Lorna Breen Health Care Provider Protection Reauthorization Act would reauthorize these grant programs for five years. Read the press release here and the bill here.

Senator Romney Introduces Bipartisan Bicameral Legislation to Protect American Genetic Data from Foreign Adversaries

Late last week, Senator Mitt Romney (R-UT), Ranking Member of the Senate Homeland Security & Governmental Affairs (HSGAC) Emerging Threats and Spending Oversight Subcommittee, joined HSGAC Chairman Gary Peters (D-MI), Senator Bill Hagerty (R-TN), and Representatives Mike Gallagher (R-WI) and Raja Krishnamoorthi (D-IL), in introducing bipartisan, bicameral legislation to help prevent foreign adversaries from stealing sensitive American genetic data and personal health information. The Prohibiting Foreign Access to American Genetic Information Act of 2024 would ban all biotechnology companies that are owned or controlled by a foreign adversary, such as the Chinese Communist Party (CCP), and whose business practices threaten national security, from receiving U.S. taxpayer dollars through federal contracts, grants, and loans. A fast-track ban would be applied to the BGI Group (BGI), MGI, Complete Genomics, WuXi AppTec, as well as their subsidiaries. Read the press release here and the bill here.

Senators Cruz, Scott, Ossoff Lead Bipartisan Effort Ensuring Veterans Receive Timely Access to Health Care

Late last week, Senators Ted Cruz (R-TX), Rick Scott (R-FL), and Jon Ossoff (D-GA) introduced the bipartisan and bicameral Scheduling for Community Health and Easy Data to Understand for Legislators to Evaluate Services (SCHEDULES) Act. The bill would require the Secretary of Veterans Affairs (VA) to establish a comprehensive standard for timing between referrals and appointments at VA facilities and to submit a report with respect to that standard. This legislation is based on reports from the Government Accountability Office that highlighted issues related to timeliness in accessing care for veterans. Read the press release here and the bill here.

Executive Branch:

CMS Releases Proposed Payment Updates for 2025 Medicare Advantage and Part D Programs

On Wednesday, the Centers for Medicare & Medicaid Services (CMS) released the Calendar Year (CY) 2025 Advance Notice for the Medicare Advantage (MA) and Medicare Part D Prescription Drug Programs that would update payment policies for these programs. MA payments from the government to MA plans are expected to increase on average by 3.70 percent, or over $16 billion, from 2024 to 2025, as proposed. CMS is also detailing improvements to the structure of the Medicare Part D drug benefit for CY 2025 through the concurrent release of the Draft CY 2025 Part D Redesign Program Instructions. Read the press release here.

Biden-Harris Administration Announces Action to Increase Access to Sickle Cell Disease Treatments

On Wednesday, the Biden-Harris Administration announced that sickle cell disease (SCD) will be the first focus of the Cell and Gene Therapy (CGT) Access Model. The CGT Access Model is part of the Administration’s broader effort to further drive down prescription drug costs and was developed in response to an executive order that President Biden issued in October 2022 directing the Department of Health and Human Services to consider developing models that increase access to novel therapies and lower the high cost of drugs. The model, led by the Centers for Medicare & Medicaid Services’ (CMS’) Innovation Center, will test outcomes-based agreements (OBAs) for groundbreaking CGTs. Successful OBAs will increase affordable access to potentially lifesaving and life-changing treatment. This model will begin in 2025 and may be expanded to other types of CGTs in the future. Read the press release here.

CMS Makes its First Offers to Drug Companies in Price Negotiation Process

On Thursday, the Centers for Medicare and Medicaid Services (CMS) sent its initial offers to drug companies for the first ten drugs subject to negotiation under the Inflation Reduction Act (IRA). CMS sent what it considers to be the maximum fair price that Medicare should pay for the drugs but did not make the offers public. Companies have 30 days to either accept the offer or propose a counteroffer. Negotiations will end on August 1, and new prices will take effect in 2026. Read more information on the Medicare Drug Price Negotiation here.

HHS Makes Virtual Buprenorphine Prescribing Permanent

On Wednesday, the Department of Health and Human Services (HHS) finalized the rule permanently allowing buprenorphine, a treatment for opioid use disorder, to be prescribed through audio-only telehealth without an in-person visit. The Substance Abuse and Mental Health Services Administration (SAMHSA) said the rule, which applies only to certified opioid treatment programs, makes drug therapy more accessible. The rules go into effect on April 2, and the compliance date is April 2, 2026. Read the rule here.

HHS Announces Department Actions to Slow Surging Syphilis Epidemic

On Tuesday, in response to the surging number of syphilis and congenital syphilis cases nationwide, the Department of Health and Human Services (HHS) announced it is taking action to slow the spread with a focus on those most significantly impacted. Through the establishment of the National Syphilis and Congenital Syphilis Syndemic (NSCSS) Federal Task Force, the Department is utilizing its agencies, its expertise, and its stakeholder network to respond to the U.S. syphilis and congenital syphilis epidemic. The actions of the Task Force leverage federal resources to reduce rates, promote health equity, engage impacted communities, and direct resources to support those most impacted. Read the press release here.

Legal & Other:

Judge Signals Doubt on AstraZeneca’s Harm in Drug Price Program

On Wednesday, AstraZeneca PLC and the US Department of Justice held oral arguments in the US District Court for the District of Delaware over the Medicare Drug Price Negotiation Program. AstraZeneca alleges that the CMS’s 2023 negotiation program guidance violated the Administrative Procedure Act (APA) by overriding the Medicare statute’s definition of “qualifying single source drug” will decrease the incentives to develop new drugs. During the oral arguments on Wednesday, Chief District Judge Colm F. Connolly for the US District Court for the District of Delaware repeatedly asked AstraZeneca what harm it will face from the US government’s Medicare drug price negotiation program. The Department of Justice, representing the CMS, argued the drugmaker can’t claim an injury on hypothetical future events. Connolly’s target decision date for the case is on or before March 1. Read more on the case here.

AI-Generated Clinical Summaries May Not be Subject to FDA Medical Device Regulations

On Monday, researchers from the University of Maryland published a new JAMA paper that found clinical applications of generative artificial intelligence and large language models (LLMs), specifically LLMs that summarize clinical notes, may not be considered a medical device under the FDA and would not be subjected to FDA rules. The FDA released guidance on artificial intelligence products two months before ChatGPT revolutionized AI, which suggested the agency did not consider note-taking AI within its purview because the technology does not make specific predictions or disease estimates. The authors of the JAMA article stated that even if the FDA were to seek to write rules for such AI products, it might fail without receiving explicit new authority from Congress. Read the FDA guidance here and the JAMA report here.