Health Policy Report

September 18, 2017

The Week in Review

The week started on a somber note as the nation marked the 16th anniversary of the September 11th terror attacks and assessed the damage from Hurricane Irma’s landfall on the Florida coast. That latter event delayed the House’s return to Washington, although lawmakers were able to return on Tuesday to work on an immigration bill and a highly partisan FY18 appropriations bill. The first (H.R. 3697) of those two measures would make it easier for government officials to deport undocumented immigrants involved in gang activity and was approved on Thursday by a 233-175 margin. The appropriations bill was subject to hundreds of amendments and contains a number of policy riders deemed “poison pills” by Democrats. For that reason, last week’s narrow 211-198 vote is largely a messaging exercise ahead of the more substantive funding negotiations that will take place later this fall.


The Senate spent last week toiling at its version of the FY18 National Defense Authorization Act (NDAA) with final passage expected this week. Among the more notable developments was consideration of an amendment from Sen. Rand Paul (R-KY) that would repeal the 2001 and 2002 Authorizations of Military Force (AUMF) that provide the legal basis for American military operations in the Middle East. The amendment failed, but a bipartisan group of 36 senators supported it, signaling that it may become a more prominent issue in Congress going forward.

A significant meeting occurred on Thursday between President Trump and Democratic leaders Chuck Schumer (D-NY) and Nancy Pelosi (D-CA) as the two sides continue to discuss the future of the deferred action for childhood arrivals (DACA) program. Both Democrats’ offices put out statements shortly after the meeting that the President had agreed to “enshrine the protections of DACA into law” with a “a package of border security excluding the wall, that’s acceptable to both sides.” President Trump offered a slightly different version of events on Twitter the following morning, saying that “no deal was made last night on DACA” and “The WALL, which is already under construction in the form of new renovation of old and existing fences and walls, will continue to be built."

The Week Ahead

With the House out of town, the Senate will return today to continue consideration of the FY18 National Defense Authorization Act (NDAA) (H.R. 2810). A final cloture and up-or-down vote on the bill is expected this evening, after the chamber adopts a substitute amendment from Sen. John McCain (R-AZ) that constitutes the Senate’s version of the bill. Passage is expected, but it remains unclear how the two chambers will reconcile their visions for the annual defense policy measure. The Senate is also expected to approve the nomination of Noel Fransisco to be Solicitor General early this week.

The House has left Washington and will remain in recess until Monday Sep. 25. With the major September deadlines on government funding and the debt ceiling already handled, House lawmakers will avoid a previously feared week of chaos when they return, but significant programs such as the Children’s Health Insurance Program (CHIP) and Federal Aviation Administration (FAA) are still set to expire at the end of the fiscal year on Sep. 30. Lawmakers are hoping to reach an agreement on a long-term deal for CHIP in early October, while the FAA is likely to see a short-term reauthorization before the end of the month.

In notable international news, world leaders will gather in New York for the 72nd United Nations General Assembly. The meeting will occur under the specter of increasing tensions on the Korean peninsula, although no breakthrough is expected at the annual meeting. All eyes will be on President Trump when he speaks to the UN for the first time on Tuesday, particularly given his “America First” approach and past comments offering tepid support for international organizations.

Cassidy, Graham Building Momentum for September Vote on 'Repeal and Replace' Bill

With just two weeks remaining before fast-track reconciliation instructions for health care expire, a new Affordable Care Act (ACA) ‘repeal and replace’ bill introduced by Sens. Bill Cassidy (R-LA), Lindsey Graham (R-SC) may be gaining steam in the Senate. Several Senate GOP staffers have confirmed that Republican leadership has been applying pressure in support of the bill, and the authors have predicted that the leaders will publicly endorse the bill soon. With less than two weeks until the fast-track “reconciliation” instructions for health care expire — allowing the GOP to pass legislation through the Senate with a simple 50-vote majority — Senate Republicans face a narrow window in their last-ditch effort to substantially overhaul the ACA.

The bill introduced last week would substitute a block grant for the funding that now provides states with resources for Medicaid expansion, premium tax credits, and cost-sharing reduction subsidies. Sen. Cassidy claimed he had the support of as many as 49 senators, after Senate Majority Leader Mitch McConnell (R-KY) declared the bill’s sponsors would be responsible for finding the 50 votes needed on their own. Additionally, representatives from the hardline House Freedom Caucus announced their support for the bill, as Chairman Mark Meadows (R-NC) has been pushing for a Senate vote.

Perhaps throwing a wrench in Sen. Cassidy’s plan, Sen. Rand Paul (R-KY) again announced his opposition last week and called the bill “Obamacare lite.” With the loss of Sen. Paul’s vote, Cassidy-Graham can only absorb one more defection. This means that the measure will require the support of at least two of the three Senators who opposed the last attempt to repeal and replace — Sens. Susan Collins (R-ME), Lisa Murkowski (R-AK), and John McCain (R-AZ). Sen. Collins called the defunding of Planned Parenthood “problematic,” and although McCain has expressed some support for the bill, he cautioned any repeal effort should go through regular committee process. Additionally, the Congressional Budget Office (CBO) has yet to score the bill, lending to uncertainty as Senators attempt to analyze how their states would fare under block grants. Notably, all CBO health staff has been pulled from other work to focus on Cassidy-Graham — a signal that Senate leadership is serious about the effort.

Senate Finance Leaders Announce Five-Year Agreement to Extend CHIP Funding

Senate Finance Committee leaders Orrin Hatch (R-UT) and Ron Wyden (D-OR) announced that an agreement has been reached to provide a five-year extension of the Children’s Health Insurance Program (CHIP). Absent Congressional reauthorization, federal CHIP funding is slated to expire on Sept. 30. While the details are sparse – and no legislative language has been released at this time – the Committee leaders reiterated their intention to “pass a five-year CHIP funding extension into law as soon as possible.” The lawmakers indicated that draft legislation will be released “in the coming days.” House Energy and Commerce Committee Chairman Greg Walden (R-OR) reported last week that House members would use their week-long recess to “work through some things” before marking up a version of the reauthorization.

Of note, the Committee press release alluded to transitioning CHIP “over time” to “its traditional federal-state partnership,” presumably referencing Congressional plans to phase down the Affordable Care Act (ACA)-enhanced 23 percentage point “bump.” Lawmakers are rumored to be considering maintaining the 23-percentage point increase in 2018-2019, as authorized under current law, but potentially phasing out the increased Federal Medical Assistance Percentage (FMAP) to a lower threshold (e.g., 11.5 percent in 2020 and 0 percent by 2021-2022).

Sanders Unveils Single-Payer Legislation, "Medicare for All"

Last Wednesday, Senator Bernie Sanders (I-VT), joined by 16 of his Democratic colleagues, introduced the Medicare for All Act of 2017, a single-payer health care proposal expected to set the tone for Democratic debate in the next election cycle. The measure would establish a national health insurance program called the Universal Medicare Program, under which every U.S. resident would receive health insurance through an expanded Medicare program, with enrollment transitioned over a four-year period. In prepared remarks, Sen. Sanders said Americans will “save billions of dollars a year in medical administrative costs,” and will benefit from “the freedom and security that comes with finally separating health insurance from employment.” Many have argued that the universal system could come with serious tradeoffs, as it would require upending health coverage for tens of millions of people who are happy with the plans they receive through their jobs. Although Sen. Sanders has not settled on a method to pay for his plan, his proposal includes a new 7.5 percent payroll tax on employers in addition to increased levies on the wealthy and large banks. 

Clearly, the legislation is being viewed by many as a “marker” in wake of the GOP’s failed ACA repeal/replace deliberations and the subsequent discussions on health reform ahead of the next election. Democrats – particularly those who face tough reelections – are divided on the bill and the policies that lie behind single-payer systems, and Democratic leadership has yet to endorse Sen. Sanders’ proposal. President Trump lambasted the bill last week, calling it a “curse” on the American people. Additionally, Sen. John Barrasso (R-WY) asked the Congressional Budget Office (CBO) Friday to analyze the bill, and cited concerns that the left-leaning Urban Institute provided estimates in 2016 of an earlier version of Sen. Sanders’ plan that showed costs of $32 trillion over 10 years.

House on Path to Replicate Senate Chronic Care Bill

Seven bipartisan Medicare-related bills were unanimously passed by the House Energy & Commerce Health subcommittee last Wednesday. Many of the measures were similar to those in the Senate Finance Committee’s CHRONIC Care Act, passed unanimously last May. Per a House source, the lower chamber can combine these bills with others currently under consideration by the House Ways & Means Committee to create a parallel package to the legislation approved by Finance. The bills passed by the House Energy & Commerce Committee Wednesday included:

  • The Furthering Access to Telemedicine Act of 2017 (H.R. 1148);
  • A bill to extend the Medicare Independence at Home Medical Practice Demonstration Program for two years (H.R. 3263);
  • The Steven Gleason Enduring Voices Act of 2017 (H.R. 2465);
  • The Protecting Access to Diabetes Supplies Act of 2017;
  • The Medicare Civil and Criminal Penalties Act (H.R. 3245);
  • A bill aiming to reduce the volume of future electronic health record-related significant hardship requests (H.R. 3120); and
  • The Prostrate Cancer Misdiagnosis Elimination Act of 2017 (H.R. 2557).

Additionally, the Ways & Means Committee is considering the Increasing Telehealth Access in Medicare bill and the Medicare Part B Improvement Act, which mirror language in the CHRONIC Care Act. The telehealth legislation was also cleared during markup by the Ways & Means Committee last Wednesday. The House Ways & Means may still consider four additional Medicare bills before creating some sort of packaged legislation. With the Senate expected to “hotline” their version of the bill as soon as this week — which is expected to advance without opposition — and the House well on their way to crafting an analogous version of the bill, odds are favorable that Congress will send a bill to President Trump’s desk by the end of this year.

Senate HELP Chair Promises Insurance Stabilization Deal ‘Early This Week’

The Senate Health, Education, Labor, & Pensions (HELP) Committee rounded out a series of bipartisan hearings focusing on solutions to stabilize the health care system last week. Chairman Lamar Alexander (R-TN) announced the Committee’s plans to craft and release a bipartisan bill by early this week, enabling it to conceivably pass the Senate by the end of the month. Last Thursday during the Committee’s fourth and final hearing on the subject, the Chairman outlined his goal to stabilize the insurance markets ahead of the September 27th deadline for insurers to sign contracts to sell plans on the Affordable Care Act (ACA)-created exchanges. It is expected that the themes embraced by Sen. Alexander in his opening remarks to that fourth hearing could be encompassed in the stabilization packages, namely, an agreement to fund the ACA’s cost-sharing reduction (CSR) payments to  insurers (which President Trump has threatened to withhold), the addition of high deductible “copper plans” to individuals 30 and over, and the granting of more flexibility for states to approve health insurance plans that waive certain ACA regulations (ex. essential health benefits, age rating limits).