Health Policy Report (1/27)

January 27, 2020

The Week in Review

The Senate began its historic impeachment trial against President Donald Trump after officially receiving two articles of impeachment from the House. Senators are considering two charges, including abuse of power and obstruction of Congress, laid forth by the House in its articles. Under the rules of engagement, House managers and White House lawyers will have up to 24 hours to present their respective cases, followed up to 16 hours of questioning by Senators. The Senate will then deliberate whether to hear from more witnesses or consider evidence beyond what surfaced in the House investigation.

The Week Ahead

House lawmakers will return to Washington today eyeing floor action on a package of credit-related bills out of the Financial Services Committee. The measure includes a host of bills that cleared the Committee on a party-line basis last summer. Notable bills included in the package would amend the Fair Credit Reporting Act (FCRA) to: (1) ban the use of credit information for most employment decisions (H.R. 3614); (2) establish requirements relating to credit scores and educational credit scores (H.R. 3618); and (3) reform the consumer report dispute process and ban certain “misleading and unfair” consumer reporting practices (H.R. 3642). Also on the House floor this week, lawmakers will consider legislation that seeks to limit President Trump’s ability to engage in military offensives against Iran absent Congressional approval. 

Meanwhile, White House lawyers are set to resume their portion of the impeachment trial today in defense of President Trump. Once the president’s legal team completes their round of opening arguments, Senators are expected to begin their 16 hours of questioning. The trial could wrap up as early as this week if the Senate does not pursue additional evidence and witness testimony.

Supreme Court Timing for ACA Case Uncertain

The Supreme Court last week rejected timing requests from both Republican and Democrat Attorneys General on the Affordable Care Act (ACA) case, Texas v. USA. Last Tuesday, the Supreme Court rejected Democrats’ request to fast-track their consideration of the case around the constitutionality of the Affordable Care Act’s individual mandate before the end of the highest court’s current term. While Republicans cheered this move earlier in the week, their request to extend the deadline to respond until March was also denied on Friday. Timing for the Supreme Court to hear the case is now up in the air, as many assumed the earlier denial meant the case would not be heard until after the 2020 presidential election. Legal experts tracking the case have suggested that the Court may decide to hear oral arguments just before the election in the fall, and their decision not to fast-track the case suggests they are unlikely to “hurry the case along.” The GOP parties must now respond to the Democrats’ Jan. 3 petition to review the case by Feb. 3.

Trump Says He Will ‘Save’ Social Security

President Trump assured voters he would protect Social Security benefits on Twitter Thursday after facing criticism from Democrats for hos earlier comments. The president had noted during an interview at the World Economic Forum in Davos on Wednesday that he would “take a look at” rolling back entitlements “at the right time,” for which Democrats immediately banged him for going back on previous promises not to cut Social Security, Medicaid, or Medicare. Senate Minority Leader Chuck Schumer (D-NY) accused President Trump of already having gone after Medicare, and of now pursuing cuts to Social Security as well. The president responded on Twitter Thursday that Democrats would be the ones to “destroy” Social Security, whereas he will “save it.”

The president previously vowed during his election campaign that he would not cut funding for entitlement programs but has signaled he may be willing to do so during a second term. A White House spokesperson declared in a statement that the president is not pushing benefit cuts in his efforts to reform Medicare and Social Security, and instead he wants to cut waste, fraud and abuse and to get people back to work. Medicare advocates noted that although the White House has pushed back against claims the president is planning definitive cuts, President Trump’s previous budgets have included significant Medicare program cuts.

Administration Expected to Announce Medicaid Block Grant Plan Thursday

The administration is reportedly set to announce plans to encourage Medicaid block grants on Thursday. The plan – under development by Centers for Medicare and Medicaid Services (CMS) Administrator Seema Verma for more than a year – will overhaul the Medicaid program by allowing states to shift some funding to block grants and would specifically target Medicaid recipients who gained coverage under Affordable Care Act (ACA) expansion. The administration will encourage plans to utilize Section 1115 waivers to implement capped spending for individuals covered under the expansion.

Administrator Verma has previously made comments on the need to restrain Medicaid spending, and noted during a November speech that many states had “expressed a willingness to be held accountable for improving outcomes in exchange for greater flexibility and budget certainty.” Medicaid advocates have already vowed to sue over the action, noting that it would lead recipients to lose access to vital health care and would circumvent Congress’ intent for Medicaid.

Insurers Launch Nonprofit Drug Company to Lower Prices A group of 18 Blue Cross Blue Shield insurers have banded together to invest $55 million in the creation of a new generic drug company. The new subsidiary of nonprofit Civica RX will focus on manufacturing generics in areas that lack competition or suffer from high prices. Civica RX was founded in 2018 by a group of hospitals with the goal of producing generic versions of hospital-administered drugs, although the Blue Cross Blue Shield subsidiary will only produce drugs that are sold at the pharmacy counter. Civica RX announced that “other health plans, employers, retail partners, and health care innovators who share the belief that patients and their needs come first are invited to join the initiative.” Generic drugs from the new subsidiary will be available as early as 2022.