Health Policy Report (10/19)

Capitol Hill Update

The Senate is poised to take up another targeted pandemic relief bill when the chamber convenes for votes today, Senate Majority Leader Mitch McConnell (R-KY) said last week. The forthcoming package is largely expected to mirror the previous Senate GOP “skinny relief” effort, including business liability provisions and allocating roughly $500 billion toward unemployment insurance, health care, education, and small businesses. Much like the previous attempt to clear this measure last month, it is expected that all Senate Democrats, and possibly a few Senate Republicans, will vote against a motion to consider the legislation. Meanwhile, broader relief talks between Speaker Nancy Pelosi (D-CA) and White House officials remain at a standstill, as outlined in a recent “Dear Colleague” letter from the Speaker over the weekend.

‘Most Favored Nations’ Rulemaking Could Come Post-Election

In conversations with sources in the administration, on Capitol Hill, and beyond, TRP has learned that formal rulemaking on the Trump administration’s proposed “most favored nations” (MFN) policy for prescription drugs under Medicare Parts B is not expected to come until sometime after the election. While rumors had circulated recently that publication of an interim final rule on the Part B portion of the MFN rulemaking might be imminent, more recent intel suggests that the Department of Justice (DOJ) has stepped in to block the idea of jumping straight to an interim final rule — so instead, a proposed rule is the anticipated next step.

The delay comes as the Centers for Medicare and Medicaid Services (CMS) is prioritizing the implementation of a demonstration to distribute $200 “discount cards” to be used to offset prescription drug copays. TRP’s sources and various press reports have indicated the timing of that project is being driven by the upcoming presidential election. Democratic leaders of congressional health care committees sent a letter to the Government Accountability Office to quickly review the legality of the “discount cards” on October 13, noting that they “are further concerned about the legality and propriety of these actions, particularly in light of recent press reports indicating that the timing of this project is being driven by the upcoming presidential election.” House Energy & Commerce Chairman Frank Pallone (D-NJ), House Ways & Means Chairman Richard Neal (D-MA) and Senate Finance Ranking Member Ron Wyden (OR) asked that the GAO respond by October 19. Meanwhile, separate rulemaking on MFN for Part D is expected to take even longer for the agency to produce. For more on the MFN executive order (EO), read TRP’s summary of the order as well as our special report on how the MFN EO could be implemented. 

Judge Barrett Offers Health Care Perspectives During Confirmation Hearings

Seventh Circuit Court Judge Amy Coney Barrett faced questions from members of the Senate Judiciary Committee last week as she seeks confirmation to the Supreme Court. Committee Democrats focused much of their questioning on the potential consequences of Judge Barrett’s elevation to the Court on the Affordable Care Act (ACA), warning that she would be a decisive vote to overturn the 2010 law. They highlighted her criticism of Chief Justice John Roberts’ opinion in NFIB v. Sebelius which allowed the ACA to stand by designating the individual mandate a tax.

Judge Barrett, for her part, said that she is “not here on a mission to destroy the Affordable Care Act” and said that her writings on the case are immaterial to the current case before the Supreme Court. Rather, she said, the current case hinges on severability. Judge Barrett told Senators that in general, courts should not unduly undo legislators’ work. “The presumption is always in favor of severability,” said Judge Barrett. “The doctrine of severability serves a valuable function of trying not to undo your work when you wouldn’t want a court to undo your work.” The question of whether the Affordable Care Act will be allowed to stand may hinge on the severability of the individual mandate from the rest of the law. If found to be inseverable from the rest of the law, the entire ACA may be struck down after the Court hears the case California v. Texas in November. She also denied that she has spoken to the White House about the case. President Trump has repeatedly signaled that he expects Judge Barrett to supply a vote to overturn the law.

Republicans sought to simultaneously criticize the ACA and reassure the public that a Justice Barrett would not vote to axe the law, with Judiciary Committee Chairman Lindsey Graham (R-SC) saying that if it were up to him, “bureaucrats would not be administering health care from Washington, people in South Carolina would be running health care.” Senator Mike Crapo (R-ID) mentioned a moot court exercise in which Judge Barrett concluded that the ACA’s individual mandate was unconstitutional but was severable from the rest of the law. Judge Barrett, however, reminded Senators to not assume a legal position based on a moot court exercise. Following the conclusion of the confirmation hearing, the Judiciary Committee is set to vote on Judge Barrett’s nomination on Oct. 22. A vote in the full Senate is expected during the week of Oct. 26.

CMS Announces 11 New Medicare Telehealth Services

Last Wednesday, the Centers for Medicare and Medicaid Services (CMS) announced an expansion of its telehealth services list during the COVID-19 pandemic (telehealth list, press release). CMS added 11 new services to its telehealth list, allowing for a number of rehabilitation services and neurostimulator analysis. The telehealth list now includes 249 different codes, including 146 that have temporarily been added for the duration of the public health emergency (PHE). These codes account for 144 total services eligible to be paid when provided via telehealth. Near the beginning of the COVID-19 pandemic, CMS added a wide variety of services to its list of payable telehealth services. In May, it also created a new process for adding or removing services from the telehealth list during the PHE, allowing the agency to modify the list through guidance rather than through rulemaking. Last week’s additions were the first made using the new process.

Telehealth services on the list are eligible for Medicare fee-for-service (FFS) payment, and the new codes are eligible for payment effective immediately. The services are paid at the same rate as they would be if they were provided in a facility. CMS notes that between mid-March and mid-August, over 12.1 million Medicare beneficiaries with FFS coverage have received a telehealth service. That number comprises over 36 percent of total FFS enrollment.

CMS also released a “data snapshot” Wednesday on telehealth use in Medicaid and CHIP during the PHE. According to CMS, Medicaid and CHIP beneficiaries received over 34.5 million telehealth services between March and June 2020, more than a 2,600 percent increase over the previous year. CMS also released a supplement to its COVID-19 Medicaid and CHIP toolkit for states, prompting them to identify services that can be accessed through telehealth and which services can continue to be reimbursed under what circumstances after the end of the PHE.

CMS Approves Georgia’s Medicaid Work Requirements Demonstration Program

The Centers for Medicare and Medicaid Services (CMS) last Thursday announced its approval of the State of Georgia’s 1115 demonstration request to expand coverage to low-income Georgia adults who meet “community engagement” requirements. The “Pathways to Coverage” demonstration applies to individuals between the age of 19 and 64, with income up to and including 100 percent of poverty. CMS Administrator Seema Verma stated that the “comprehensive state-led reform will help thousands of working adults in Georgia gain access to coverage for the first time in a way that addresses both their health and socio-economic needs.”

Georgia is the second of the so-called “non-expansion states” to pair eligibility for coverage for adults with the community engagement requirements outlined in CMS’ Healthy Adult Opportunity (HAO) guidance released earlier this year. The state estimates that over 30,000 individuals will receive Medicaid coverage during the first year of the demonstration and that 65,000 are projected to enroll in Medicaid or receive Medicaid premium assistance for coverage through Employer Sponsored Insurance (ESI) over the five-year demonstration. The state plans to begin implementation July 1, 2021. Notable in the approval of Georgia’s 1115 demonstration is that CMS is denying the state’s request for enhanced federal match for this demonstration population. Instead the agency writes that it will continue the existing policy of providing the enhanced federal match rate when the state covers the entire adult expansion group, which includes adults with income up to 133 percent of the federal poverty level (FPL).

Leading up to the November elections, this approval demonstrates CMS’s commitment to approve controversial Medicaid programs with work requirements. It also allows the Administration to tout policies designed to promote pathways to coverage and financial sustainability for low income adults. Similar to other state Medicaid work requirement initiatives, stakeholder concerns are likely to land this demonstration program in the courts. Regarding next steps with Georgia’s program, CMS is continuing to work with the state to finalize its other pending request — complementary reforms of its individual health insurance market through a section 1332 State Relief and Empowerment Waiver.

White House Officials Promote Herd Immunity Declaration

In a phone call last Monday, White House officials cited the Great Barrington Declaration, arguing that the government should push for herd immunity with additional COVID-19 infections among the young and healthy populations. The declaration was authored by a small group of doctors and has been used to push back against “lockdowns” during the public health emergency, despite investigative reporting finding that many of the signatures were fake names. The three doctors behind the declaration met with Department of Health and Human Services Secretary Alex Azar last week to discuss the declaration which has been embraced by Scott Atlas — neuroradiologist and adviser to President Trump. Dr. Anthony Fauci criticized the White House’s support for the declaration last week, calling it “nonsense” and “ridiculous.” He explained that “anybody who has any experience in epidemiology and infectious diseases will tell you that that is risky, and you’ll wind up with many more infections of vulnerable people, which will lead to hospitalizations and deaths.”