Capitol Hill Update

Both chambers will kick off the March legislative work session today as lawmakers face another lengthy list of legislative priorities — headlined by the March 11 government funding deadline. Appropriators have expressed optimism that the two sides are close to reaching an omnibus spending deal for fiscal year (FY) 2022, which will likely include the White House’s $6.4 billion request for supplemental appropriations to support Ukraine. Assuming Congress can pass an omnibus spending deal and avoid another continuing resolution (CR), lawmakers are expected to promptly shift gears toward the FY 2023 appropriations process this month.

Capitol Hill Update

Both chambers of Congress have adjourned for the President’s Day district work period after the Senate passed the short-term government funding bill last week. Appropriators will have until Friday, March 11 to complete their work on an omnibus spending package for fiscal year (FY) 2022. Reports out of Capitol Hill suggest that each appropriations subcommittee has received its specific topline allocation, but the full list of 302(b) funding numbers has not been made publicly available yet. 

Capitol Hill Update

The Senate will reconvene for legislative business today eyeing action on legislation that would implement a series of reforms to the U.S. Postal Service. Specifically, the Postal Service Reform Act (H.R. 3076) would, among other things: (1) provide USPS with $50 billion in additional funding over 10 years; (2) require future retirees to enroll in Medicare; and (3) establish a Postal Service Health Benefits program for USPS employees and retirees. While the House-passed bill is expected to clear the Senate with strong bipartisan support, timing on a final vote could slip due to a last-minute disagreement between leadership and Sen. Rick Scott (R-FL) over a technical change to the legislation.

Senators are also slated to vote on a continuing resolution (CR) (text; summary) that would keep the government funded beyond Friday’s deadline. However, it is possible that the Senate’s vote on the stopgap falls closer to February 18 due to a hold placed on the measure by Sen. Marsha Blackburn (R-TN). Specifically, Sen. Blackburn has been critical over language contained in the Substance Abuse and Mental Health Service Administration’s (SAMHSA) Harm Reduction Grant program that could be perceived as directly funding certain drug paraphernalia. It is unclear whether a clarifying statement issued by Health and Human Services (HHS) Secretary Xavier Becerra and Office of National Drug Control Policy (ONDCP) Director Dr. Rahul Gupta is enough to ease the Senator’s concerns.

Meanwhile, appropriations leaders are expected to continue their negotiations on a fiscal year (FY) 2022 omnibus spending deal after reaching an agreement on a “framework” for government funding last week. While the agreement will allow appropriators to begin writing each of the 12 appropriations bills, leadership has yet to formally unveil the 302(b) subcommittee funding allocations for each of the spending measures. Reports out of Capitol Hill suggest that appropriators are expected to support a funding level for defense spending that exceeds authorization levels established in the FY 2022 National Defense Authorization Act (NDAA). The forthcoming omnibus legislation is also likely to include scores of congressionally-directed spending items (House; Senate).

Califf Teed Up to Receive Official Confirmation Vote

After putting Robert Califf’s nomination on ice while Senate and White House leadership worked to whip votes, Senate Majority Leader Chuck Schumer (D-NY) filed cloture on a vote on Califf’s confirmation to lead the Food and Drug Administration (FDA). This move likely signals that Schumer is confident in the Senate’s ability to confirm Califf, with a vote expected as soon as tomorrow. The White House has been making the rounds on Capitol Hill — including calls from White House COVID coordinator Jeff Zients and Chief Medical Advisor Anthony Fauci — to drum up support for Califf amid concerns about this candidacy on both sides of the aisle.

Califf participated in over 50 interviews this past week to assuage Senators’ concerns, and some members are still on the fence. On the Republican side, Sens. Rob Portman (R-OH), Thom Tillis (R-NC), Rick Scott (R-FL), and Pat Toomey (R-PA) are still weighing Califf’s merits, but Senate Majority Whip Dick Durbin (D-IL) is fairly confident that he has a sufficient number of his Republican colleagues on board. Califf also secured support from Sens. Michael Bennet (D-CO) and Ron Wyden (D-OR), though Sens. Richard Blumenthal (D-CT), Maggie Hassan (D-NH), and Joe Manchin (D-WV) remain opposed to Califf’s nomination.

Biden Gives Speech on Drug Pricing Reform

On Thursday, President Joe Biden took to the road in a campaign-style speech (TRP analysis) aimed at selling the drug pricing proposalsincluded in his signature Build Back Better (BBB) agenda. Less than 24 hours after Sen. Bernie Sanders (I-VT) attempted to ignite the issue on the Senate floor by seeking unanimous consent (UC) on a new, more aggressive legislative proposal, the President doubled down on policies included in the BBB Act. In his address, the President spoke to his desire to “hold drug companies accountable” by allowing Medicare to negotiate drug prices, imposing mandatory rebates for drugs that rise faster than inflation, capping the amount seniors pay for prescription drugs at $2,000 per year, and improving transparency at pharmacies. 

While President Biden’s remarks served to underscore the areas of consensus on drug pricing among Democrats in Washington, he strayed from Sen. Sanders’s sentiments. Sanders recommended a plan that would go significantly further than the Democratic party’s consensus approach, including calling on Medicare to lower drug prices down to the levels paid by the Department of Veterans’ Affairs. Senator Sanders’ approach has also put him at odds with Senate Majority Leader Chuck Schumer (D-NY), who has resisted his calls to bring stand-alone drug pricing legislation to the floor. 

Tensions Rise Over 1115 Waivers, Medicaid Premiums

As the Biden administration continues to push for Medicaid expansion and increase enrollment, the White House is moving to eliminate premiums. While premiums are generally not permitted in the Medicaid program, some states charge premiums through their 1115 waivers. Specifically, the Biden administration’s efforts from late 2021 direct Arkansas, Georgia, and Montana to phase out premiums by the end of 2022. Now, the administration may also follow suit in the other five states that charge premiums under their waivers: Arizona, Indiana, Iowa, Michigan, and Wisconsin.

States and the federal government have long struggled for power over Medicaid policy, and this tension has been exacerbated by 1115 wavier disagreements. Biden’s efforts to withdraw previously approved waivers are especially frustrating for those states, as waivers can take years to approve and are now at risk of rescission before they expire. The heated debate is driving some stakeholders to revisit the traditionally Republican concept of implementing Medicaid block grants instead of waiver programs. They argue that waivers add a layer of uncertainty to states’ Medicaid programs, given the unpredictability of policy shifts due to changes in administrations. Additionally, advocates of block grants note that waivers can dissuade non-expansion states from expanding their programs.

Legislators Release Telehealth Legislation

As uncertainly around the extension of the public health emergency (PHE) grows, telehealth advocates are growing more restless. The PHE designation enabled telehealth flexibilities to increase accessibility, and there has been bipartisan support to retain some of those flexibilities. Most recently, the Department of Health and Human Services (HHS) extended the COVID-19 PHE for 90 days, until April 16, 2022. Absent another extension of the PHE, however, Medicare beneficiaries would be slated to lose access to telehealth services.

In an attempt to rectify this situation, Sens. Catherine Cortez Masto (D-NV) and Todd Young (R-IN) introduced the Telehealth Extension and Evaluation Act (text; press release; section-by-section), which would provide for a two-year: (1) extension of telehealth services under Medicare; (2) modification of payment structures for high-cost durable medical equipment (DME) and laboratory tests ordered via telehealth; and (3) addition of a special payment rule for telehealth services provided by federally-qualified health centers (FQHC) and rural health clinics.

If passed, the legislation would aid in avoiding an abrupt termination of telehealth access for Medicare beneficiaries at the conclusion of the PHE, as is set to take place currently. Meanwhile, stakeholders have been pushing for an extension of certain telehealth flexibilities to ride on a potential omnibus spending deal for fiscal year (FY) 2022, though, at this time, it is too early to tell if this path forward is realistic. While extension legislation was introduced in the Senate last week, its House companion — the Telehealth Extension Act of 2021 (H.R. 6202) — was released by Rep. Lloyd Doggett (D-TX) in December 2021.

CDC Releases Highly-Anticipated Draft Guidance for Opioid Prescribing

Last week, the Centers for Disease Control and Prevention (CDC) released the long-anticipated notice of its draft 2022 Clinical Practice Guideline for Prescribing Opioids (TRP summary). The draft guidance updates the CDC’s 2016 guidance and is intended for the use of clinicians providing outpatient pain care for patients 18 years or older with acute pain, subacute pain, or chronic pain. The 2022 draft guidance includes a detailed summary of findings that informed the CDC’s recommendations. Specifically, the clinical practice guideline addresses: (1) determination process of initiating opioid treatment; (2) opioid selection and dosage; (3) treatment duration and follow-up; and (4) assessing harms of opioid use. CDC notes that its final guidance will not apply to pain stemming from sickle cell disease, cancer, palliative care, or end-of-life care.

CDC currently provides guidance to clinicians in the realm of pain care primarily through the 2016 CDC Guideline for Prescribing Opioids for Chronic Pain. In that guidance document, CDC noted that it would update guidance accordingly as new evidence and research is developed. Since 2016, the CDC has reviewed noninvasive, nonpharmacological, and nonopioid treatments. The updated 2022 guidance is intended to reflect this research.

These clinical practice guidelines are intended to function as a tool to improve patient-provider communication and are not a law or regulation. In developing the guidelines, CDC collaborated closely with the Opioid Working Group (OWG) and the Board of Scientific Counselors, National Center for Injury Prevention and Control (BSC/ NCIPC). Notably, this updated guidance no longer recommends that doctors “avoid increasing dosage” to 90 morphine milligram equivalents (MME). The new guidance also removed language that suggests limits for acute pain prescriptions.

Capitol Hill Update

Late last week, House lawmakers passed [222-210] the America Creating Opportunities for Manufacturing Pre-Eminence in Technology and Economic Strength (America COMPETES) Act (text; fact sheet; section-by-section). The roughly $350 billion technology research and innovation package would provide $52 billion toward domestic semiconductor production, as well as $45 billion to bolster domestic supply chains and manufacturing efforts. Looking ahead to next steps, leadership in both chambers could offer a motion to go to conference and produce a final compromise version that blends the America COMPETES legislation and United States Innovation and Competition Act (USICA) as soon as this week. While leaders are hopeful to reach a deal within 30 days, House and Senate conferees will need to navigate a series of policy differences between the chambers’ respective bills before a firm path forward emerges.

When Congress returns this week, House lawmakers will look to consider legislation that would keep the government funded beyond the February 18 deadline. The “four corners” leaders of the Appropriations Committees remain engaged in negotiations on an omnibus spending deal for fiscal year (FY) 2022, but a series of disagreements over policy riders has stalled progress on a topline funding agreement. If House and Senate appropriators are unable to reach a deal, it is likely that leadership will introduce a continuing resolution (CR) at some point prior to the end of the week that would fund the government into early March or April.

Also on the floor this week, the House is scheduled to consider: (1) legislation that seeks to end mandatory, pre-dispute arbitration for sexual assault and harassment disputes (H.R. 4445); (2) a bill that would impose sanctions on foreign individuals found to be complicit in violating LGBTQ rights (H.R. 3485); and (3) a measure that seeks to implement a series of reforms to the U.S. Postal Service (USPS) (H.R. 3076). Meanwhile, Senators will resume consideration of pending presidential nominations, starting with the nominations of Ebony Scott and Donald Tunnage to be Associate Judges for the Superior Court of the District of Columbia.

House Committee Holds Hearing On User Fee Amendments

On Thursday, the House Energy and Commerce Subcommittee on Health held a hearing (TRP summary) to discuss the reauthorization of the Prescription Drug User Fee Act (PDUFA), the Generic Drug User Fee Amendments (GDUFA), and the Biosimilar User Fee Act (BsUFA). These programs authorize the Food and Drug Administration (FDA) to collect user fees from manufacturers, supplementing funds appropriated to the agency to ensure that new drug, biologics license, generic drugs, and biosimilar product applications receive timely reviews. Notably, Medical Device User Fee Amendments (MDUFA) were not discussed in yesterday’s hearing as the FDA failed to meet the January 15 deadline to transmit the commitment letter for the next MDUFA iteration.

Included in this robust discussion were comments surrounding: (1) vaccine efficacy and safety; (2) biosimilar interchangeability; (3) research and development; (4) antimicrobial resistance; and (5) cell and gene therapies. Members unanimously agreed that the COVID-19 public health emergency (PHE) has disproportionally impacted inspection and review timelines for biosimilars in comparison to the other user fee programs, prompting policy recommendations from witnesses to remedy this issue. Both Republicans and Democrats on the subcommittee expressed strong support for the reauthorizations of these programs, noting that each of the three proposals contains incremental resources to aid in robust drug development and evaluation.

Stakeholders Clash Over Drug Cost Reporting

Large companies that provide health insurance are fueling demand for drug price information, but pharmacy benefit managers (PBM) and manufacturers assert that legal roadblocks prohibit them from publicizing that information. In November, the Biden administration delayed surprise billing rules promulgated in the No Surprises Act (NSA) that would require health plans to report prescription drug spending. Agencies presiding over the impending regulations requested public comment regarding the implementation of the rule’s billing and transparency regulations, catalyzing disagreement within the industry.

The ERISA (Employee Retirement Income Security Act of 1974) Industry Committee (ERIC) asserts that the administration should further delay enforcement of the “surprise billing” rule, which is set to take effect this December, as well as put the onus on PBMs to comply with transparency requirements. PBMs have access to the information required in the NSA, while large, self-insured employers do not have access to this formulary and prescription drug cost data. However, PBMs and drug manufacturers argue that the NSA only applies to rebates provided by plans.

Drug manufacturers agreed with ERIC that the Centers for Medicare and Medicaid Services (CMS) should delay enforcement of the surprise billing regulations, and they have encouraged CMS to report on direct and indirect remuneration (DIR), including amounts paid to PBMs. On the other hand, PBMs assert that plans and issuers are responsible for data reporting requirements, adding that their service fees are outside of the NSA’s scope and do not need to be reported.

Biden Looks to Revitalize Cancer Moonshot Program

President Biden announced on Wednesday that he will revamp the Cancer Moonshot program that he launched as Vice President in 2016. The program aims to reduce cancer deaths by 50 percent over 25 years, and the adminstration hopes to leverage lessons learned during the COVID-19 pandemic to reach that goal. As part of this initiative, the Biden administration will stand up a “Cancer Cabinet” with members of several health agency officials, including the Department of Health and Human Services (HHS), the Food and Drug Administration (FDA), the Centers for Disease Control (CDC), and the National Institutes of Health (NIH). Danielle Carnival, a senior advisor to the director of the White House Office of Science and Technology Policy, has been tapped to coordinate Moonshot.

The program includes seven areas of focus: (1) diagnose cancer sooner; (2) prevent cancer via technology and environmental initiatives; (3) address inequities; (4) target treatments to patient needs; (5) speed access to treatments for deadly and rare cancers; (6) learn from share patient data; and (7) support patients, caregivers, and survivors. Despite grand plans for Cancer Moonshot, the administration recognizes that funding for the revamped project has yet to be secured, as the project’s initial funding in 2016 was only authorized for seven years in the 21^st Century Cures Act.

To Democrats’ Chagrin, CMS Predicts Pay Bump for MA Plans

On February 2, 2022, the Centers for Medicare and Medicaid Services (CMS)released the Calendar Year (CY) 2023 Advance Notice (fact sheet; press release) of Methodological Changes for Medicare Advantage (MA) Capitation Rates and Part C and Part D Payment Policies. The document lays out specific and technical changes to MA and Part D payment policies, though some notable inclusions caught the eye of lawmakers. Specifically, CMS predicts that MA plans will see an eight percent pay increase in 2023, due in part to a 3.5 percent revenue increase from the MA risk score calculation. Regulators and lawmakers have been keeping a close eye on MA risk adjustment scores, as some argue that these scores enable plan administrators to get more money out of the Medicare program.

The same day that CMS released its 2023 MA projections, the Senate Finance Committee held a hearing (TRP summary) on Medicare’s financial troubles. Subcommittee Chair Elizabeth Warren (D-MA) framed MA plans as the “privatization” of Medicare arguing that MA plans add a heavy cost burden on the Trust Fund. Her discussion of MA plans led to criticism of the Direct Contracting Model (DCM) through the CMS Center for Medicare and Medicaid Innovation (CMMI). Meanwhile, Republicans drew a different conclusion and focused on mechanisms to improve MA’s cost burden while maintaining the program’s accessibility. They engaged in conversations about consumer transparency as a mechanism to align incentives in Medicare, as well as balancing trade-offs between cost and quality of care.

Capitol Hill Update

Both chambers of Congress will return to kick off the February legislative session this week. The Senate will return first later today and will primarily focus on clearing the queue of President Joe Biden’s pending nominations. On the House side, lawmakers are scheduled to resume legislative business tomorrow and consider legislation that seeks to end mandatory, pre-dispute arbitration for sexual assault and harassment disputes (H.R. 4445). Members are also slated to take up the America Creating Opportunities for Manufacturing, Pre-Eminence in Technology, and Economic Strength (America COMPETES) Act (text; fact sheet; section-by-section) at some point next week after leadership introduced the package on Wednesday. More than 500 Amendments to the America COMPETES Act were filed late last week, and the Rules Committee will meet on Tuesday to consider a rule for the measure.

Late last week, House Speaker Nancy Pelosi (D-CA) provided lawmakers with an update on the chamber’s schedule for next month. At the top of the list is government funding for fiscal year (FY) 2022, as Congress has less than a month until the February 18 deadline. Leadership has expressed optimism that appropriators can reach an agreement on an omnibus spending package and avoid a shutdown, but another short-term continuing resolution (CR) cannot be ruled out should more time be needed to broker a deal. Speaker Pelosi also noted that the House will “soon” introduce counterpart legislation to the Senate’s United States Innovation and Competition Act (USICA), with the goal of going to conference with senators and producing a finalized version that can pass both chambers.

Capitol Hill Update

House lawmakers will kick off the second session of the 117^th Congress today, followed by votes on a pair of legislative items throughout the balance of the week. In a “Dear Colleague” letter to Members late Friday, House Majority Leader Steny Hoyer announced that lawmakers will take up a bipartisan bill that would allow local educational agencies participating in the Education Department’s Impact Aid Program to use the student-count or federal-property-valuation data from their fiscal year (FY) 2022 program applications for their FY 2023 applications. Proponents of the legislation — which passed the Senate by unanimous consent late last year — argue that it is needed to prevent schools from losing COVID-19 relief funds by providing flexibility to use pre-pandemic data to calculate needs. 

Capitol Hill Update

Sen. Joe Manchin (D-WV) delivered a serious setback to President Joe Biden’s legislative agenda over the weekend after he announced that he will not support the Build Back Better Act (BBBA). The centrist West Virginia Senator — who was heavily engaged in negotiations with leadership on the overall size and scope of the $1.7 trillion social spending package — cited the national debt, ongoing COVID-19 pandemic, and inflation metrics as key reasons why he came out against the legislation. The surprise announcement drew the ire from both moderate and progressive Democrats, as well as the White House, which issued a statement criticizing Sen. Manchin for walking back previous commitments to find common ground. Press Secretary Jen Psaki noted that the administration plans to “find a way to move forward” in 2022, according to the remarks.

Capitol Hill Update

After punting the government funding deadline to February 2022, Congress will meet this week and turn its attention to other year-end legislative priorities, starting with the federal debt ceiling. The Treasury Department has circled December 15 as its “X Date,” at which point it will no longer be able to utilize “extraordinary measures” to prevent a default. Absent GOP support on a measure to address the debt ceiling, Democrats will likely need to leverage the budget reconciliation process to raise the debt limit with a filibuster-proof legislative vehicle. Other notable items on lawmakers’ radar include addressing: (1) statutory “pay-as-you-go” (PAYGO) rules to avoid across-the-board spending cuts as a result of the American Rescue Plan (ARP); (2) a looming two percent spending cut for all Medicare services; (3) the FY 2022 National Defense Authorization Act (NDAA); (4) an expiring 3.75 percent increase to physician pay; and (5) several “tax extender” policies that are set to expire at year’s end.

Capitol Hill Update

Congress has adjourned for the Thanksgiving district work period following House passage of the Build Back Better Act (BBBA) late last week. Lawmakers will return on Monday, November 29, when they will have less than five days to act on the looming December 3 government funding deadline. With Democrats and Republicans still very far apart on a topline funding agreement for fiscal year (FY) 2022, it is likely that another short-term continuing resolution (CR) will be needed to avert a shutdown. While the stopgap funding measure has yet to be formally unveiled, intel from Capitol Hill suggests that the legislation will likely extend the funding date toward the middle or end of December. In addition to appropriations, lawmakers will also need to tackle the December 15 debt ceiling “X date” and the annual National Defense Authorization Act (NDAA), among other key year-end priorities.