Health Care Checkup: January 12, 2024

Health Care Checkup

January 12, 2023

THE BIG PICTURE: KEY CONGRESSIONAL & EXECUTIVE BRANCH DEVELOPMENTS

Congress has until January 19 to avert a partial government shutdown. On Thursday, Senate Majority Leader Chuck Schumer (D-NY) filed cloture on a legislative vehicle that will become a short-term continuing resolution (CR) that would last until either March 1 or March 15. House Speaker Mike Johnson, who initially opposed an additional CR and committed to passing the first four appropriation bills by the Jan. 19 deadline, has softened his stance this week, stating he would not rule out a CR.

What to Expect Next Week:

Next week, the Senate is set to take an initial procedural step on a stopgap funding bill. The House would then need to act by January 19^th to avert a partial shutdown. At this point, it is unclear whether any policy riders will be part of the package.

In addition, the House Rules Committee has announced they will meet to consider a slew of bills next week.

On Thursday, the Senate Health, Education, Labor and Pensions (HELP) Committee will hold a hearing titled “Addressing Long COVID: Advancing Research and Improving Patient Care."

DEEP DIVE

Congressional:

House and Senate Return to Capitol Hill this Week with Much to Do

Congress has until January 19 to avert a partial government shutdown, which includes funding for the FDA and the VA, and until February 2 to pass the Labor-HHS package and the remaining seven appropriations bills. Last weekend, the House, Senate, and White House reached an agreement on FY24 topline funding levels for the 12 annual appropriations bills. The deal aims to fund the government in line with levels agreed to during the debate over the Fiscal Responsibility Act (FRA) levels, which should result in $886.3 billion for defense and $772.7 billion for non-defense. Despite this, Senate leadership has expressed concern there is not enough time to pass the first round of appropriations bills before the first deadline. On Thursday, Senate Majority Leader Chuck Schumer (D-NY) filed cloture on a legislative vehicle that will become a short-term CR and will last until either March 1 or March 15. House Speaker Mike Johnson, who has opposed an additional CR, initially stated he would pass the first four appropriation bills by the Jan. 19 deadline. The Speaker has softened his stance this week, stating he would not rule out a CR. However, there is still substantial opposition to another CR among a faction of House GOP conservatives.

Congress Grapples with Health Care Reauthorizations and Legislation in 2024

Early into the second session of the 118^th Congress, lawmakers are tackling imminent fiscal 2024 government funding deadlines, major program reauthorizations, and other potential legislation touching on healthcare sectors. Major healthcare issues on lawmakers’ radars this year include:

Expiring Programs, Reauthorizations, and extenders:
Key provisions in the President's Emergency Plan for AIDS Relief, known as PEPFAR, expired last year. Talks have stalled amid partisan fights over whether to include a rider restricting recipients from using their own funds for abortion-related services.

The 2018 opioid law, the SUPPORT ACT (PL 115-271), expired last year. The House passed its version of the reauthorization in December (H.R. 4531), and the Senate Health, Education, Labor and Pensions (HELP) Committee advanced a similar bill (S. 3393) last month, though funding level differences remain that need to be worked out.

Several workforce programs, temporarily extended under the last CR, are set to expire on Jan. 19, including funding for the Community Health Centers and the Teaching Health Centers Graduate Medical Education Program. The Senate HELP Committee passed the Bipartisan Primary Care and Health Workforce Act (S. 2840) that included a funding increase in September, while the House passed its version, the Lower Costs, More Transparency Act (H.R. 5378), in December.

A key 2013 pandemic preparedness law (PL 113-5) also needs to be reauthorized. Reauthorizations are split between three bills in the House and Senate (H.R. 4421, H.R. 4420, and S. 2333). The main difference between the House and Senate versions is the Senate's inclusion of language addressing prescription drug shortages.

Cuts to Medicaid Disproportionate Share Hospitals payments take effect Jan. 19 unless Congress acts. The Lower Costs, More Transparency Act (H.R. 5378), which passed the House on Dec. 11, delays the cuts through 2026, as does a bill (S. 3430) that the Senate Finance Committee advanced in November.

Incentives to participate in advanced alternative payment models expired Jan. 1. An extension passed the House Energy and Commerce health subcommittee on Nov. 15 and the Senate Finance Committee in November (S. 3430).

Insulin Price Caps: Efforts to cap the out-of-pocket cost of insulin to $35 per month for patients on private insurance could see floor votes. Competing bipartisan bills, S. 1269 and S. 954, take different approaches to capping insulin prices.

Medicare Payments: The Centers for Medicare & Medicaid Services (CMS) reduced physician reimbursement rates in Medicare by 3.4% for 2024. The Senate Finance members advanced S. 3430, and House Energy and Commerce members advanced H.R. 6545 to increase pay rate by 2.5%.

Price Transparency: In December, the House passed the Lower Costs, More Transparency Act (H.R. 5378), which would codify Trump-era regulations requiring hospitals to post prices online and require more transparency by pharmacy benefit managers, and require site-neutral payments for drug administration and require off-campus hospital outpatient departments to bill under separate provider identifiers. The Senate has a similar policy in the Bipartisan Primary Care and Health Workforce Act (S. 2840), which would require separate provider identifiers in the commercial market but would not require site-neutral payments for drug administration.

Pharmacy Benefit Managers (PBMs): In December, the Senate Finance Committee advanced the Modernizing and Ensuring PBM Accountability Act (S. 2973), which would delink PBM compensation from list prices in Medicare Part D, increase transparency and require Health and Human Services to establish standardized performance measures that pharmacies can be judged by. Legislation advanced by the HELP Committee in May, the Pharmacy Benefit Manager Reform Act (S. 1339), would require PBMs to submit annual reports to group health plans and health insurance issuers and prohibits spread pricing in the commercial market.

Other Things to Watch Out For: Prior authorization reform, the role of artificial intelligence in health care, expansion of telehealth services, and supply chain issues.

Bicameral Push to Avert Scheduled Physician Pay Cuts

On Wednesday, lawmakers in the House and Senate expressed support to reverse or mitigate scheduled pay cuts for doctors under Medicare. House Energy and Commerce Health Subcommittee Chairman Brett Guthrie (R-KY) said he was working with Senate HELP Committee ranking Republican Bill Cassidy (R-LA) on an extender package that could hopefully be attached to any spending bill. The House GOP Doctors Caucus also recently met with Speaker Mike Johnson (R-LA) to secure his support for including the rider in whatever spending bill hits the floor. Caucus co-Chair Greg Murphy (R-NC) stated Johonson was “absolutely open to it.”

House Committee on Education and the Workforce Holds Hearing on Lowering Healthcare Costs and Increasing Access to Healthcare

On Thursday, the House Education and Workforce Subcommittee on Health, Employment, Labor, and Pensions held a hearing to address lowering costs and increasing access to health care with employer-driven innovation. During the hearing, both Republicans and Democrats agreed that better guarantees for employers to access their healthcare data is critical to their ability to control costs. The witness panel featured health policy experts including Mrs. Michele Beehler, Senior Director of Health and Wellbeing at Schweitzer Engineering Laboratories (SEL); Ms. Laura Josh, General Manager of California Schools VEBA; and Dr. Christopher Whaley, Health Economist at RAND Corporation. Read the hearing recap here.

MedPAC Recommends Congress Reduce Medicare Payments to Nursing Homes in 2025

On Thursday, the Medicare Payment Advisory (MedPAC) voted to recommend that Congress reduce Medicare payments to nursing homes, home health agencies, and inpatient rehabilitation facilities in 2025. MedPAC voted to recommend base payment rate cuts of 7% for home health agencies, 5% for inpatient rehabilitation facilities, and 3% for nursing homes. The panel is calling on Congress to increase Medicare payments to hospitals, doctors, and dialysis centers in 2025. The proposals come amid a legal fight between the home health sector and the Health and Human Services Department over the methodology used to determine Medicare payments. The commission stated nursing home pay cuts would save Medicare between $2 billion and $6 billion over one year, and $10 billion to $25 billion over five years. The home health and inpatient rehabilitation facility pay cuts would each save $750 million to $2 billion in one year, and from $5 billion to $10 billion over five years. The recommendations will be included in the commission’s March report to Congress on Medicare payment policy. Read more information on the meeting here.

MedPAC Holds Meeting Discussing Policy Options for Medicare Advantage

On Friday, MedPAC held a meeting to discuss the status of the Medicare Advantage (MA) program. The commission noted 52% of eligible beneficiaries are enrolled in MA plans and the number of available plans are increasing. MedPAC also discussed local and national market concentration and ways to compare spending on MA to Medicare fee-for-service (FFS). MedPAC also discussed different policy options for standardizing MA parts A and B cost sharing and supplemental dental, vision, and hearing benefits. MedPAC commissioners discussed three different policy options and the pros and cons of each. Read more information on the meeting here.

Chairman Sanders, Baldwin, Luján, Markey Launch HELP Committee Investigation into Efforts by Pharmaceutical Companies to Manipulate the Price of Asthma Inhalers

On Monday, Senators Bernie Sanders (I-VT), Chairman of the Senate Committee on Health, Education, Labor, and Pensions (HELP), Tammy Baldwin (D-WI), Sen. Ben Ray Luján (D-NM), and Sen. Ed Markey (D-MA) sent letters to the CEOs of four pharmaceutical companies seeking information on the costs and pricing decisions of inhalers used to treat asthma and chronic obstructive pulmonary disease, or COPD. The Companies are the four biggest inhaler manufacturers in the United States and charge between $200 and $600 per device. In a press release, Sanders stated, "There is no rational reason, other than greed, as to why GlaxoSmithKline charges $319 for Advair HFA in the United States, but just $26 for the same inhaler in the United Kingdom.” The letter also asked for information on internal decisions that might increase the cost of inhalers, such as why the companies continually introduce new products with only small tweaks. The Senators have requested a response from the companies by Jan. 22. Read the press release here and the letter here.

Rep. Murphy Pushes for FDA for Information on Regulating AI in Healthcare

Last week, in a letter to Food and Drug Administration (FDA) Commissioner Robert Califf, Rep. Greg Murphy (R-NC), co-chair of the GOP Doctors Caucus, inquired about the development of AI regulations in healthcare. The FDA authorizes some AI products under its existing rules for medical devices and is considering whether it needs additional rules for new, mostly unregulated tools, such as chatbots. Murphy asked Califf in the letter: (1) how the FDA will handle the expected increase in AI-driven medical tools, (2) whether the agency plans to strengthen its third-party review program to free up its workforce, (3) whether the FDA supports alternative pathways for approving AI devices or liability-safe harbors for devices and doctors who use them, and (4) what role outside groups, such as medical or hospital credentialing boards, should play in creating standards for using the tech. Read the press release here and the letter here.

Notable Bills Introduced:

Sens. Grassley, Braun, Sanders, Smith, Hickenlooper Introduce Bill to Reveal Health Care Prices for Americans

On Wednesday, Senators Chuck Grassley (R-IA), Mike Braun (R-IN), Bernie Sanders (I-VT), John Hickenlooper (D-CO), and Tina Smith (D-MN) introduced bipartisan legislation to codify rules directing hospitals and insurers to disclose cash prices and negotiated rates to patients before they receive medical care. The Health Care PRICE Transparency Act 2.0, would require publication of machine-readable files of all negotiated rates and cash between plans and providers, expand price transparency requirements to include clinical diagnostic labs, imaging centers, and ambulatory surgical centers, and enhance enforcement mechanisms by increasing the maximum annual penalties for noncompliance to $10 million, with ceilings and floors determined by the number of hospital beds in a facility. Read the press release here and the bill here.

Sen. King Introduces Bipartisan Bill to Fast-Track Combat Veterans’ Access to Health Care Benefits

On Wednesday, Senator Angus King (I-ME), a member of the Senate Veterans Affairs Committee, introduced legislation to give combat veterans the option to enroll in their healthcare benefits program before officially transitioning out of active duty. The bipartisan Combat Veterans Pre-Enrollment Act would create an opt-in program allowing transitioning servicemembers to access VA healthcare services on their first day as a civilian. Read the press release here and the bill here.

Sens. Warner, Blackburn Introduce Legislation to Increase Transparency of Medicare Advantage Benefits for Seniors

On Wednesday, Senators Mark R. Warner (D-VA) and Marsha Blackburn (R-TN), members of the Senate Finance Committee, introduced the Medicare Advantage Supplemental Benefits Transparency Act of 2023, which would require Medicare Advantage plans to report enrollee-level data on supplemental benefits to the Centers for Medicare & Medicaid Services (CMS), as well as report eligibility for benefits, the types of benefit categories offered, and data on utilization of and payments for such benefits. Read the press release here and the bill here.

Reps. Emmer, Torres Lead Bipartisan Push to Expand Access to Mental Health Services

On Monday, Reps Tom Emmer (R-MN) and Ritchie Torres (D-NY) introduced a bipartisan bill, the Securing Facilities for Mental Health Services Act. The legislation would eliminate the prohibition in Section 242 of the National Housing Act that currently prohibits inpatient psychiatric hospitals from applying for mortgage assistance. Currently, these hospitals are the only type of healthcare facility prevented from accessing mortgage assistance through the Section 242 program. If passed, this bill will help alleviate the inpatient bed shortage across the country and eliminate further barriers to psychiatric inpatient hospital expansion. Read the press release here and the bill here.

Carter, Castor, Joyce, Schrier introduce Emergency Medical Services for Children Reauthorization Act of 2024

On Thursday, Representatives Buddy Carter (R-GA), Kathy Castor (D-FL), John Joyce (R-PA), and Kim Schrier (D-WA) introduced the Emergency Medical Services for Children (EMSC) Reauthorization Act of 2024. Established in 1984, EMSC is the only federal program focused on enhancing emergency care for children and adolescents. EMSC funding is used to ensure that hospitals and ambulances are properly equipped to treat pediatric emergencies, provide pediatric training to paramedics and first responders, and improve the systems that allow for efficient, effective pediatric emergency medical care. Read the press release here and the bill here.

Executive Branch:

FDA Issues First Approval for Mass Drug Imports to States from Canada

Late last week, the Food and Drug Administration (FDA) authorized Florida's plan to import certain prescription drugs from Canada, making it the first state to receive such approval. The plan is authorized for two years from the date of the first shipment, according to the FDA. The state must submit quarterly reports to the agency outlining cost savings and any safety issues. The approval comes after three years of delay and two lawsuits. But FDA Commissioner Robert Califf said he is committed to working with states and tribes looking to import drugs. The FDA must still approve requests from individual pharmacies and wholesalers before they can import specific drugs. Any importer must submit details of individual drugs they expect to purchase. The state says the program is ready to launch, with a foreign seller and domestic distributor on tap. The plan would apply to recipients in state programs, such as Medicaid and prisons, which Florida estimates could save up to $150 million. Read more information here.

HHS Finalizes Nondiscrimination Rule

On Tuesday, the Department of Health and Human Services (HHS) issued a final rule restoring a process for handling moral and religious discrimination complaints in healthcare settings. The HHS rule clarifies the enforcement of existing federal conscience laws and the tools available to the department's Office of Civil Rights to process and investigate complaints against healthcare entities. In 2019, the Trump administration issued a final rule that allowed healthcare providers to refuse care based on religious or moral grounds, including for abortion care. However, the rule never took effect because of legal challenges and three subsequent district court decisions. HHS said the rule issued Tuesday would protect the civil rights of people with disabilities, LGBTQ individuals, and people seeking reproductive care. The Biden administration said the new final rule would build on a separate 2011 conscience-protections rule and emphasized in its responses to comments that investigations of violations will be "prompt.” Read the rule here.

A Record High Number Selected Affordable Health Coverage in ACA Marketplace for 2024

On Wednesday, HHS announced that more than 20 million Americans have enrolled in the health exchanges as of Dec. 23, a record high. The new record comes as millions of Americans lost their Medicaid and Children's Health Insurance Program coverage at the end of the COVID-19 public health emergency. Total plan selection includes 3.7 new enrollees and 16.6 million who had active coverage in 2023 and re-enrolled in 2024. This data represents enrollment activity through Dec. 23 for the 32 states using HealthCare.gov and the 18 states and the District of Columbia that use state-based marketplaces. Read the CMS press release here.

Legal & Other:

Hospital Groups Seek Fast End to Online Tracking Enforcement

Late last week, healthcare industry groups urged a Texas federal judge to make an early ruling favoring their legal challenge against the US government’s enforcement of tracking tools to monitor users’ visits to public health websites. The American Hospital Association (AHA) is pushing for a December 2022 HHS guidance to be thrown out, which the group said has forced its members to stop tracking visitors to their websites. The group argued in a federal district court filing Friday that the guidance is unlawful since the agency didn’t go through the traditional rulemaking process. In a statement, HHS said it “supports the use of online tracking technology by health care providers, health plans, and other HIPAA-regulated entities when implemented in compliance with the HIPAA Rules.” Read the court brief here.