Health Care Checkup: March 8, 2024

Health Care Checkup

March 8, 2024

THE BIG PICTURE: KEY CONGRESSIONAL & EXECUTIVE BRANCH DEVELOPMENTS

This week, the House passed five noncontroversial health care bills under suspension of the rules that would reauthorize programs related to maternal mortality, pediatric research and cancer, oral care for underserved populations, and clarify current law related to primary care coverage and mental health.

What to Expect Next Week:

The next six-bill package for the remaining federal government spending bills is expected to be released as early as this weekend, with a deadline of March 22.

On Tuesday, the House Ways and Means Committee will hold a hearing on enhancing access to care at home in rural and underserved communities. On Thursday, the Senate Finance Committee will hold a hearing on the President’s proposed budget for FY2025 for the Department of Health and Human Services.

DEEP DIVE

Congressional:

First Minibus for 2024 Appropriations Bills Passes House

On Wednesday, the House passed a six-bill, $467.5 billion final fiscal 2024 appropriations package, in a 339-85 vote under suspension of the rules. The package includes the Military Construction-VA measure, which is the underlying vehicle, as well as the Agriculture, Commerce-Justice-Science, Energy-Water, Interior-Environment, and Transportation-HUD bills. House Speaker Mike Johnson (R-LA) won a majority of votes from his conference, despite opposition from his party’s right flank, with 132 Republicans voting in favor and 83 opposing the measure. The bill would give the FDA $3.52 billion in discretionary funding for fiscal 2024, around $70 million less than fiscal 2023. Additionally, the Department of Veterans Affairs would receive $134.8 billion, roughly $48 million above the fiscal 2023 level. Several health care provisions were added to the package, including:

Physician Payments: The legislation provides a 1.68% boost in Medicare pay for physicians, resulting in a 2.93% total adjustment to blunt the 3.4% pay cut that the Biden administration finalized last fall through a mandated formula.
Public Health: The legislation extends funding for several public health programs until Dec. 31, 2024, including funds for Community Health Centers, the National Health Services Corps, and the Teaching Health Center Graduate Medical Education program.
Substance use disorder: The legislation would permanently require state Medicaid plans to cover medication-assisted treatment. The bill also includes a provision to mandate a state Medicaid option for Institutions for Mental Diseases or IMD exclusion.
Disproportionate Share Hospital payment: Eliminates certain Disproportionate Share Hospital (DSH) payment cuts through December 31, 2024.
The bill does not reauthorize an expired pandemic and emergency preparedness (PAHPA) law but includes extensions of seven smaller provisions in the broader law and extended in previous stopgap funding bills. It also did not include legislation on pharmacy benefit managers (PBMs), site-neutrality legislation, or reauthorization of the SUPPORT Act.
Read the full list of health provisions here.

The Senate must now clear the bill ahead of the midnight Friday deadline to head off a partial government shutdown this weekend. Senate Majority Leader Charles Schumer (D-NY) said he would put the bill on the floor immediately after House passage with the goal of passing it “with time to spare” before the deadline. The next six-bill package for the rest of the federal government is expected to be released as early as this weekend. Read the bill text and summaries of all six bills here.

House Passes Five Health Bills

On Tuesday and Thursday, the House passed five non-controversial health care bills under suspension of the rules that would reauthorize programs related to maternal mortality, pediatric research and cancer, oral care for underserved populations, and clarify current law related to primary care coverage and mental health.

9–8–8 Lifeline Cybersecurity Responsibility Act (H.R. 498), passed by voice vote, would tighten the cybersecurity of the 988 Suicide and Crisis Lifeline by requiring the lifeline’s network administrator and local call centers to report cybersecurity issues to the Substance Abuse and Mental Health Services Administration.
The Preventing Maternal Deaths Reauthorization Act of 2023 (H.R. 3838), which passed 382-12, the legislation would reauthorize federal support for Maternal Mortality Review Committees through fiscal 2028. It would also require the Centers for Disease Control and Prevention to create and distribute best practices to prevent maternal deaths.
The Gabriella Miller Kids First Research Act 2.0 (H.R. 3391), which passed 384-4, would reauthorize the National Institutes of Health’s Pediatric Research Initiative through fiscal 2028 and require the Department of Health and Human Services to issue a report to Congress documenting details about the grants and their progress.
The Medicaid Primary Care Improvement Act (H.R. 3836), passed by voice vote, would clarify current law so state Medicaid programs can provide primary care through a model that would allow beneficiaries to get primary care services via a regular flat fee.
The Action for Dental Health Act of 2023 (H.R. 3843), which passed 391-32, would direct federal support to groups that provide oral care to underserved populations.

House Ways and Means Committee Advances Three Health Bills Out of Committee

On Wednesday, the House Ways and Means Committee held a markup and advanced three healthcare bills out of committee, including a controversial bill which would prohibit the Biden administration from implementing a first-of-its-kind staffing requirement for nursing homes. The Protecting America’s Seniors’ Access to Care Act (H.R. 7513) was passed in a 26-17 vote along party lines, with the exception of Rep. Terri Sewell (D-AK), who called the rule “rushed” in the midst of workforce shortages. The committee also advanced the Kidney PATIENT Act of 2023 (H.R. 5074) in a 41-1 vote, which would delay until 2027 a Centers for Medicare and Medicaid Services plan to move payments for phosphate binders into a Medicare payment model for end-stage renal disease. Finally, the committee advanced the Real-Time Benefit Tool Implementation Act (H.R. 7512) in a 42-0 vote, which would require CMS to implement a law passed in 2020 (PL 116-260) requiring Medicare Part D have tools that tell patients what they may have to pay out of pocket for drugs. Under the bill, CMS would have to implement the tool no later than Jan. 1, 2027.

Senate Budget Committee Holds Hearing on Primary Care and Health Care Efficiency

On Wednesday, the Senate Budget Committee held a hearing entitled “How Primary Care Improves Health Care Efficiency.” The five witnesses included a mix of professors, a Chief Medical Officer for Clover Health, and an American Academy of Family Physicians official. Members focused on the expansion of value-based primary care, particularly in Medicare Advantage plans and moving away from fee-for-service (FFS), scaling successful primary care models such as Accountable Care Organizations (ACOs), having CMS expand hybrid payment systems and the need for site-neutral legislation to increase competition and lower costs. Read Mehlman’s hearing summary here.

Senate HELP Committee Holds Hearing on the Older Americans Act

On Thursday, the Senate Health, Education, Labor and Pensions (HELP) Committee held a hearing Thursday on the Older Americans Act, which is up for reauthorization at the end of fiscal 2024. The act, initially passed in 1965 under former President Lyndon B. Johnson’s Great Society programs aimed to bolster health care and long-term care for older Americans. HELP Chair Bernie Sanders (I-VT) called for the program’s funding to be doubled to more than $4.6 billion. Ranking member Bill Cassidy (R-LA) stated he’s seeking a “thoughtful and bipartisan reauthorization” through a working group with Sanders and Sens. Susan Collins (R-ME), Mike Braun (R-IN), Markwayne Mullin (R-OK), Bob Casey (D-PA), Tim Kaine (D-VA) and Ed Markey (D-MA). Read more on the hearing here.

Senate HELP Chairman Sanders, Ranking Member Cassidy, and Bipartisan Group of Colleagues Seek Information from Stakeholders on Older Americans Act Reauthorization

On Thursday, in coordination with the hearing, Senators Bernie Sanders (I-VT), Chairman of the Senate Health, Education, Labor, and Pensions (HELP) Committee, and Ranking Member Bill Cassidy (R-LA), with Sens. Susan Collins (R-ME), Mike Braun (R-IN), Markwayne Mullin (R-OK), Bob Casey (D-PA), Tim Kaine (D-VA) and Ed Markey (D-MA) requested input from stakeholders on policies the Committee should consider during the reauthorization of the Older Americans Act (OAA). Specifically, the senators asked for feedback on the effectiveness of pandemic-era flexibilities, as well as policies enacted by the 2020 reauthorization, in responding to the needs of older adults across the United States. The OAA was last reauthorized in 2020 and will expire on September 30, 2024. Responses to the request for information are due March 21, 2024. Read the press release and full request here.

Senator Sanders Applauds Boehringer Ingelheim for Reducing Inhaler Costs to $35

On Thursday, Senate HELP Committee Chair Bernie Sanders (I-VT) praised Boehringer Ingelheim after the company announced that it would cap patient copays for all of its inhalers at $35 starting on June 1, 2024. The company also announced that it will lower the list price of some of its inhalers. Sen. Sanders stated, “These are very positive steps in the right direction,” and called on three other major manufacturers of inhalers, AstraZeneca, GlaxoSmithKline, and Teva, to take similar action. Read the press release here.

Democratic Senators Urge CMS to Take Harder Line on Medicare Advantage Plans

On Monday, ten Democratic senators led by Senator Elizabeth Warren (D-MA), urged top Biden health officials to take a harder line on private Medicare Advantage (MA) health plans, arguing that insurance companies annually overcharge the government by tens of billions of dollars. In the letter sent to the leaders of the Department of Health and Human Services (HHS) and Centers for Medicare and Medicaid Services (CMS), the senators asked the administration to ensure “funds that are incorrectly going to” Medicare Advantage firms go instead to patients and medical providers. The senators also urged agency leaders to scrutinize industry practices that limit patients’ access to care, including the use of artificial intelligence (AI) in medical decisions. They also pointed to longstanding concerns about potentially misleading marketing for MA plans and transparency about costs to patients. Read the letter here.

Notable Bills Introduced:

Sens. Blumenthal, Marshall, Murphy, & Reps. Landsman, Lawler Introduce Bicameral, Bipartisan Legislation to Encourage Infant Screening for Virus that Causes Birth Defects

On Tuesday, Senators Richard Blumenthal (D-CT), Roger Marshall (R-KS), and Chris Murphy (D-CT), and Reps. Greg Landsman (D-OH) and Mike Lawler (R-NY) introduced the bipartisan, bicameral STOP CMV Act to raise awareness of congenital Cytomegalovirus (CMV). The legislation would authorize new funding to incentivize hospitals and other health care entities that care for children to screen babies for CMV within the first 21 days after birth. The bill also authorizes funding to collect data on CMV and to assist in the education and training of health care providers, patients, and the general public. Finally, the legislation directs the National Institutes of Health (NIH) to conduct research into congenital CMV. Read the press release here and the bill here.

Reps. Matsui, Kiggans, Sen. Merkley Introduce Bipartisan Legislation to Keep America's Nurses, Patients Safe

On Tuesday, Reps. Doris Matsui (D-CA), Jen Kiggans (R-VA), and Senator Jeff Merkley (D-OR) introduced a bicameral, bipartisan bill, the Nurse Overtime and Patient Safety Act, to provide nurses with stronger federal workplace safeguards. The legislation would provide strong protections at the federal level for registered nurses and licensed practice nurses, through limiting mandatory overtime, prohibiting health care facilities from requiring nurses to work with certain exceptions, adopt whistleblower and nondiscrimination protections to protect nurses against retaliation, and impose civil penalties for each known violation. Read the press release here and the bill here.

Executive Branch:

President Biden Addresses Healthcare Priorities in State of the Union Address

On Thursday night, Biden delivered his State of the Union Address, touching on a wide range of health issues, from abortion rights and IVF to lowering prescription drug costs. Biden asked Congress to expand on the Inflation Reduction Act by extending the insulin price cap to private insurance at $35 a month and expanding the number of drugs open to negotiation. He also called on Congress to pass legislation to protect in vitro fertilization, warning of further fallout from the Supreme Court’s decision overturning Roe v. Wade. Biden requested Congress fund $12 billion in the budget for women’s health research, pointing to the first White House Initiative on Women’s Health Research, spearheaded by First Lady Jill Biden. Read the full remarks here.

HHS, FTC, & DOJ, Issues Joint Request for Information as Part of Inquiry into Impacts of Corporate Ownership Trend in Health Care

On Tuesday, the Justice Department’s Antitrust Division, Federal Trade Commission (FTC) and Department of Health and Human Services (HHS) jointly launched a cross-government public inquiry into private-equity and other corporations’ control over health care. The agencies issued a Request for Information (RFI) requesting public comment on deals conducted by health systems, private payers, private equity funds, and other alternative asset managers that involve health care providers, facilities, or ancillary products or services. The RFI also requests information on transactions that would not be reported to the Justice Department or FTC for antitrust review under the Hart-Scott-Rodino Antitrust Improvements Act. Comments must be submitted by May 6, 2024. Please see the press release here for more information.

President Biden Announces New Steps to Lower Prescription Drug and Health Care Costs, Expand Access to Health Care, and Protect Consumers

On Wednesday, the Biden-Harris Administration released a fact sheet ahead of the State of the Union and the President’s Budget. The announcement included Biden’s specific request to Congress to allow Medicare to negotiate at least 50 drugs annually, up from the up to 20 allowed per year under current law. It also pointed to the $2,000 out-of-pocket cap that will apply to Medicare Part D beneficiaries in 2025 as a model cap for private insurers. It additionally included Biden’s request to Congress to expand the inflation-related drug rebates under the 2022 law to include commercial drug sales and cap cost-sharing for what are called high-value generic drugs at $2 under all Medicare plans. Read the White House press release here.

President Biden Announces New Strike Force on Unfair and Illegal Pricing

On Tuesday, President Biden announced the Administration is set to launch a new Strike Force on Unfair and Illegal Pricing, which will be co-chaired by the Department of Justice (DOJ) and the Federal Trade Commission (FTC). The Strike Force will aim to strengthen interagency efforts to thwart anti-competitive, unfair, deceptive, or fraudulent business practices particularly related to prescription drugs and health care, food and grocery, housing, and financial services. Recall the President’s Competition Council has undertaken the following in health care markets since its last meeting:

Making health care markets more affordable and competitive. In December, the Department of Commerce released a proposed framework providing guidance that agencies can consider price as a factor when determining whether to exercise march-in rights for federally funded inventions connected to prescription drugs. In addition, HHS rejected more than 1,000 Medicare Advantage TV marketing ads in one year that were misleading to consumers and proposed a rule that if finalized will prohibit insurance companies from paying brokers to steer patients towards certain plans based on compensation, rather than options that meet best patient health needs. Additionally, HHS proposed to protect Medicare consumers from third parties selling their information without their consent. HHS also took historic steps to break up the Organ Procurement and Transplantation Network vendor monopoly. Finally, FTC and HHS launched a probe into anti-competitive behavior by group purchasing organizations (GPOs) and drug wholesalers that may contribute to generic drug shortages and HHS is seeking input on how the agency can increase transparency and promote competition in Medicare Advantage markets.

Read the White House press release here.

HHS Says CMS to Take Steps to Assist Providers After UHG Hack

On Tuesday, the Department of Health and Human Services (HHS), stated that the Centers for Medicare & Medicaid Services (CMS) will take steps to assist medical providers after the cybersecurity incident at UnitedHealth Group’s Change Healthcare sparked potential cash flow concerns. The unit runs crucial networks that move data and payments throughout the health care system, and the attack has meant growing backlogs throughout the industry, including delays at pharmacies and late payments for doctors. In an email statement, HHS stated, “Numerous hospitals, doctors, pharmacies, and other stakeholders have highlighted potential cash flow concerns to HHS stemming from an inability to submit claims and receive payments.” The agency will take steps, including issuing guidance to Medicare Advantage organizations and Part D sponsors, encouraging them to remove or relax prior authorization, other utilization management, and timely filing requirements. “HHS has made clear its expectation that UHG does everything in its power to ensure continuity of operations for all health care providers impacted, and HHS appreciates UHG’s continuous efforts to do so.” Read the HHS press release here.

Drug Companies Reject First Round of Medicare Drug Price Negotiation Offers

On Monday, the Department of Health and Human Services (HHS), through the Centers for Medicare & Medicaid Services (CMS), announced that all manufacturers participating in the first cycle of Medicare drug price negotiations have responded with counteroffers. If CMS does not accept a company’s counteroffer, the two sides will meet up to three times to negotiate a maximum fair price that will take effect in 2026. Details of price offers for the 10 selected drugs are not required to be made public. Read the press release here.

FDA Commissioner Califf Says AI Regulation in Health Care is Too Much for FDA to Handle Alone

On Tuesday, the Food and Drug Administration (FDA) Commissioner Robert Califf stated that ensuring the effective and responsible use of artificial intelligence in health care is too tall a task for the FDA to handle alone in a webinar to the Coalition for Health AI (CHAI). The coalition, which works with the FDA, the White House, HHS, and the VA, includes Google, Microsoft, and Stanford Medicine among its 1,300 member organizations. During his remarks, Califf raised several concerns about AI’s future in the sector despite its promise, particularly that health systems lack sufficient infrastructure to determine whether AI has an effect on health outcomes. Calif stated that two conditions must be met to ensure that such infrastructure is in place. The first is an ability to monitor and test how algorithms change over time, and the second is the ability to ensure “complete” follow-ups with the people the technology is used on. Read Califf’s remarks here.

Legal & Other:

Cost Plus Drugs to Begin Making Epinephrine, Other Drugs in Shortage

On Monday at a White House roundtable on Lowering Healthcare Costs and Bringing Transparency to Prescription Drug Middlemen event, co-founder of Cost Plus Drugs, Alex Oshmyansky, stated Cost Plus will soon manufacture sterile-injectable drugs, such as epinephrine. The plan is to begin with epinephrine and norepinephrine, and later produce pediatric chemotherapy drugs at its newly established Dallas facility. Oshmyansky stated commercial production of the first two drugs will begin this week. The company has always planned to make drugs in shortage, but this is the first announcement of specific medications it will produce.

PhRMA Advances Medicare Drug Pricing Challenge to Fifth Circuit

On Wednesday, the Pharmaceutical Research and Manufacturers of America (PhRMA), along with the National Infusion Center Association and Global Colon Cancer Association, appealed to the US Court of Appeals for the Fifth Circuit on Wednesday a district court’s order that dismissed their lawsuit against the Medicare Drug Price Negotiation Program. Judge David Alan Ezra of the US District Court for the Western District of Texas on Feb. 12 ruled the plaintiffs’ claims fell under the Medicare Act and did not satisfy the jurisdictional prerequisites. PhRMA and affiliates brought constitutional claims alleging the drug price negotiation program violates the separation of powers doctrine, the Fifth Amendment’s due process clause, and the Eighth Amendment’s prohibition on excessive fines. Because the suit was dismissed on procedural grounds, the Fifth Circuit may first have to hear arguments on jurisdiction before a court can rule on the plaintiffs’ constitutional claims.

First Over-the-Counter Birth Control Pill to Hit Shelves this Month

On Monday, HRA Pharma, a subsidiary of Perrigo, announced that the nation's first over-the-counter progestin-only birth control pill will be available online and in retail stores "in the coming weeks" and that retailers may begin placing orders this week. The drug will have a suggested retail price of $19.99 for a one-month supply or $49.99 for three months, but prices could vary depending on the retailer. Senators Patty Murray (D-WA), Mazie Hirono (D-HI), and Catherine Cortez Masto (D-NV), in a joint statement, said the next step is ensuring that "Opill is fully covered by insurers, with no prescription barrier or extra costs." They called on Congress to consider their bill (S. 1698), which would require health plans to cover over-the-counter contraceptives. Read the joint press release here.

Coalition of Physicians Forms to Fight Private Equity in Health Care

On Tuesday, more than 5,000 physicians initiated a coalition to oppose private equity’s expansion in health care. Advocacy and trade groups OrthoForum, the Association for Independent Medicine and the Physician Empowered Leadership of Transformational Organizations are among the founders of the Coalition for Patient-Centered Care that’s hoping to influence policy at both the state and federal level. The coalition’s goals include, (1) eliminating tax breaks when private equity acquires physician groups, (2) applying the same requirements and regulations for physician acquisitions to private equity deals, and (3) increasing reporting and transparency requirements for private equity groups that acquire physician practices.

FDA Clears First Over-the-Counter Glucose Monitor

Earlier this week, the diabetes management company Dexcom announced the first over-the-counter continuous glucose monitor will be available for purchase without a prescription starting this summer. The announcement comes after the Food and Drug Administration cleared the product, called the Stelo, for OTC sales. The monitor is intended for patients with type 2 diabetes who do not use insulin or those with diabetes who want to better understand how diet and exercise impact their blood sugar levels. Dexcom has not yet released the price of the product. Read the FDA press release here.