Health Policy Report (11/4)

The Week in Review

The Senate jump-started its sluggish appropriations process last week, clearing (84-9) its first four-bill minibus containing fiscal year (2020) spending bills for Agriculture, Interior-Environment, Commerce-Science-Justice, and Transportation-HUD. While the $214 billion measure passed with broad bipartisan support, action on a second spending package quickly came to a halt. As expected, Senators did not approve a motion to proceed to consideration of the spending package containing the upper chamber's spending bills for Defense and Labor-HHS-Education over disagreements on border security and family planning policies (51-41).

In the House, lawmakers passed a host of bills out of the Natural Resources Committee. These included: (1) a bill aimed at protecting the watershed, ecosystem, and cultural heritage of the Grand Canyon region in Arizona; (2) legislation that would provide for the designation of certain wilderness, recreational management, and conservation areas in Colorado; and (3) a measure that would provide for the withdrawal and protection of certain federal land in New Mexico. Additionally, House lawmakers passed a resolution that outlines next steps in the lower chamber’s impeachment inquiry. 

The Week Ahead

The Senate will reconvene for legislative business later this afternoon. While Senators deliberate next steps in the appropriations process, they will return their attention to clearing the presidential nominations queue. A full list of nominations filed for this week can be found here. Meanwhile, House lawmakers have left Washington for their Veterans Day district work period, and will not return to action until Tuesday, Nov. 12. 

Trump Nominates Dr. Stephen Hahn to Lead FDA

President Trump on Friday officially announced his intent to nominate Dr. Stephen Hahn as FDA Commissioner. Dr. Hahn is currently the chief medical executive at the MD Anderson Cancer Center in Houston, and his lack of previous government positions has left his potential FDA agenda a mystery. Dr. Hahn is a longtime Republican donor and accomplished oncologist with five patents. President Trump reportedly interviewed Dr. Hahn for the position early in September and quickly selected him as his choice for FDA Commissioner, although the administration only recently completed a lengthy background check before announcing the nomination. In choosing Hahn, the president ignored the advice of numerous advocacy groups and former commissioners who had lobbied for acting Commissioner Ned Sharpless to permanently lead the FDA. It is not immediately clear when the Senate will take up Dr. Hahn’s nomination.

Also Friday, HHS Secretary Alex Azar announced that Dr. Brett Giroir — the current HHS Assistant Secretary of Health — will oversee the FDA as acting Commissioner while the Senate considers Dr. Hahn’s nomination. The temporary appointment of a longtime ally of Secretary Azar gives the socially-conservative wing of the administration a powerful platform in the agency. Dr. Giroir, a pediatrician, has played a key role in Trump administration efforts to restrict federal funding for abortion and curtail the use of human fetal tissue in taxpayer-funded research.

House Passes Two Drug Rebate Transparency Bills

Last Monday, the House passed two pieces of legislation aimed at increasing pharmaceutical benefit manager (PBM) transparency and the public’s understanding of prescription drug rebates. One bill would require the Secretary of Health and Human Services (HHS) to publish rebate information from Medicare and plans sold on the Exchanges aggregated at the drug class level, and the other would allow the Medicare Payment Advisory Commission (MedPAC) and the Medicaid and CHIP Payment and Access Commission (MACPAC) to see and study PBM rebates in Medicare and Medicaid. Both bills passed under suspension of the rules and with no opposition. In spite of their bipartisan support, it is unlikely that the Senate will take them up individually, though both pieces of legislation could form part of a broader health care package.

The two bills are modest in scope in relation to other PBM-related proposals under consideration. Republican members in particular have been enthusiastic about reforms that would convert the current rebate system to passing negotiated rebates to consumers at the point of sale. Additionally, some members of both parties have called for full transparency in the negotiating process between pharmaceutical manufacturers and PBMs, thus publicly disclosing the net prices plans pay for prescription drugs. The passage of this legislation stands alone from the House’s consideration of H.R. 3, Speaker Nancy Pelosi’s drug pricing package, and members have indicated that they do not wish for the scope of that package to extend beyond addressing pharmaceutical manufacturers.

Trump Administration Relaunches Substance Use Disorder Treatment Locator

Last Wednesday, the Trump Administration relaunched a critical website that is designed to assist individuals who are seeking treatment for any kind of substance use disorder (SUD), including opioid use disorder. Led by the Substance Abuse and Mental Health Services Administration (SAMHSA), the reboot features a new name for the treatment locator – Find Treatment – and uses enhanced technology to make it easier for individuals struggling with substance use problems to find treatment. The updated tool is customizable to allow people to search by their gender, age, LGBT identification, veteran status, insurance provider, type of payment, and other features including whether they wish to continue living at home or if they need residential treatment for a period of time. In conjunction with the announcement, senior White House officials issued a “call to action” for state and local officials as well as stakeholder organizations to promote and assist with disseminating information about the new resource.

Administration officials are also emphasizing the steps the Centers for Medicare and Medicaid Services (CMS) is taking to “unlock treatment for people in need.” Under the Trump Administration, CMS has approved 22 state Medicaid waiver requests to cover a broader range of mental health and substance use disorder services, including strategies for Medicaid to pay for treatment provided at Institutions for Mental Disease (IMD). Administration officials reported that they saw a significant increase in these types of requests from states, with CMS’ November 2017 guidance helping ensure states can fulfill treatment needs without fear of losing Medicaid reimbursement.

The Department of Health and Human Services (HHS) also is stressing its commitment to expanding access to treatment and improving the quality of treatment services. In particular, HHS officials called out the significance of the State Opioid Response (SOR) grants which “put a special emphasis on medication assisted treatment” (MAT) by requiring that all treatment providers receiving grants must make all forms of MAT available to patients.

CMS Planning Rules Focused on Medicaid Eligibility and Financing

The Centers for Medicare and Medicaid Services is reportedly planning a rule to crack down on improper Medicaid spending and more closely scrutinize state financing. The rule will focus on how states determine Medicaid eligibility and follows concerns from administration officials that states are improperly classifying some Medicaid beneficiaries as Affordable Care Act (ACA) expansion enrollees to increase their federal funding allotments. An additional regulation is being planned to increase transparency on how states finance their Medicaid programs and use supplemental payments. Both lawmakers and health care experts have recently raised concerns that lax oversight of state and provider relationships has led to significant overspending. CMS Administrator Seema Verma reportedly discussed the plans to “protect Medicaid program integrity” at a White House meeting in October, and the health agency may issue the rules as early as this fall. 

Sen. Warren Plans to Pay for Medicare For All with $9 Trillion Tax

Presidential candidate Sen. Elizabeth Warren (D-MA) responded to pressure from other candidates and released a plan on Friday to pay for her “Medicare for All” proposal. Sen. Warren outlined how she would implement a $9 billion tax on employers, a shift of $6 trillion in state funds to Medicare for All, heavy taxes on corporations and the wealthy, and spending cuts to other government agencies to pay for her plan. She had previously indicated support for Sen. Bernie Sanders’ (I-VT) Medicare for All plan but had called his financing too “open-ended” and disagreed with his claim that the middle class would need to face higher taxes to pay for it. The Warren proposal attempts to finance Medicare for All without raising taxes on the middle class and would cost just under $52 trillion over ten years. She explained that this cost is nearly as much as the current health care system but would cover every American and would save patients $11 trillion in out-of-pocket expenses due under the current system.

Specifically, Sen. Warren’s proposal would shift $20 trillion in costs to employers, large corporations and top earners, and the federal government would spend an additional $20 billion on the proposal. It would also implement almost $9 trillion in new Medicare taxes on employers over the next ten years, although the Senator claims these taxes would replace what they already pay to provide employees with health care. The rest of the plan would be financed through “better” implementation of the tax code, targeted cuts to the Defense Department, and the redistribution of existing spending on public health programs. Sen. Warren’s campaign will announce a detailed transition plan in the coming weeks.