Health Policy Report

April 23, 2018

The Week in Review

The Senate saw a relatively busy week in floor action after passing a resolution to undo guidance from the Consumer Financial Protection Bureau (CFPB) and narrowly confirming President Trump’s nominee to lead the National Aeronautics and Space Administration (NASA). Meanwhile, the House approved a set of measures to guard against fraud before taking an extended weekend starting Thursday.

The guidance repeal came on a 51-47 vote on Wednesday in favor of a Congressional Review Act (CRA) resolution (S.J. Res. 57) that would repeal the CFPB’s 2013 guidance that aimed to guard against discrimination in auto lending. The most consequential element of the measure is that it will repeal agency guidance, as opposed to a rule, which sets a new precedent for congressional oversight of regulations. On Thursday, James Bridenstine was confirmed as NASA Administrator by a single vote, as Democrats opposed the nomination due to Bridenstine’s alleged lack of hard science experience.

The House measures were all passed along bipartisan votes. The three bills and their votes were: a bill (H.R. 5192) that would provide fraud protection for vulnerable populations such as minors and recent immigrants was passed 420-1; a bill (H.R. 5444) that seeks to modernize and improve the Internal Revenue Service (IRS) was passed 414-0; and a bill (H.R. 5445) that would improve cybersecurity and taxpayer identity protection and modernize information technology at the IRS was passed 414-3.

The Week Ahead

The House is set to take Monday off, but both chambers will be in action this week. The Senate will reconvene today for a cloture vote on the nomination of Stuart Duncan to join the Fifth Circuit Court of Appeals.

Meanwhile, the House has teed up one of its significant remaining to-do items for the remainder of the year — reauthorization of the Federal Aviation Administration (FAA). The measure (H.R. 4) would reauthorize the aviation regulator through the 2023 fiscal year and include disaster-related provisions that would alter Federal Emergency Management Administration (FEMA) policy, but will not include controversial language to privatize air-traffic control systems. The FEMA rider aims to give the agency more flexibility in providing grants for infrastructure construction used to mitigate future natural disasters, and is likely being included in an attempt to garner Democrat votes for the package.

There will also be some election intrigue this week as voters in Arizona’s 8th congressional district will head to the polls on Tuesday to select the replacement for Rep. Trent Franks (R-AZ), who resigned last year amid sexual harassment allegations. The special election marks another contest in a heavily-Republican district, with Republican Debbie Lesko favored over Democrat Hiral Tipirneni. However, recent polling suggests that another Democratic upset is not out of the question.

Trump Delays Anticipated Speech on White House Drug Pricing Plan

President Trump announced this weekend that he has decided to delay anticipated remarks on the White House plan to tackle drug pricing. The speech, which was set for Thursday, has not yet been rescheduled and a reason for the delay was not given. The announcement follows reports that Department of Health and Human Services (HHS) Secretary Alex Azar had been released from the hospital after treatment for an intestinal infection last week.  The speech, which would have likely touched on policies outlined in the President’s budget to lower drug costs, was scheduled to coincide with a request for information from HHS on drug pricing policy proposals.

Gottlieb Pushes Simplified Approval Pathway for Biosimilars, Off-Label Communication

Last Thursday, Food and Drug Administration (FDA) Commissioner Scott Gottlieb offered a preview of what the agency will likely include in an upcoming plan to boost biosimilar development and increase competition, as well as plans to increase communication between manufacturers and pharmacy benefit managers (PBMs) to more accurately set coverage, pricing, and inform off-label use. In a speech at a meeting of the Pharmaceutical Care Management Association (PCMA), Commissioner Gottlieb detailed plans to simplify interchangeability demonstrations and make it easier for biosimilars to prove likeness to branded drugs. He also stated the FDA would look to limit the variability of branded biologics in an effort to shrink the size of the studies necessary to prove biosimilarity. Additionally, the Commissioner signaled that the long-awaited final guidance on communication between drug manufacturers and pharmacy intermediaries would be released soon in an attempt to foster more accurate coverage and pricing of pharmaceuticals.

As recently as last month, Commissioner Gottlieb offered sharp criticism of pharmacy benefit managers (PBMs) for their role in stifling generic competition. During a speech in March, he accused PBMs of working with branded drug companies to block generics from coming to the market by limiting the supply of samples with which generic developers could test interchangeability. But yesterday, before an audience of PBM stakeholders, Gottlieb was notably deferential, and offered to work with PBMs to advance a “shared” goal of improving patient care. While he did say that “some PBMs have been complacent participants” in schemes that have hamstrung biosimilar competition, he was more critical of drug manufacturers, and conceded that he’s “not here to point fingers.” Commissioner Gottlieb’s policy proposals also come just a week ahead of the White House’s planned announcement on drug pricing, and likely foreshadows future action.

Democratic Senators Introduce Medicare Buy-In Legislation

Last week, Sens. Jeff Merkley (D-OR) and Chris Murphy (D-CT) released legislation (text; summary) that would allow individuals to buy into Medicare. The so-called Choose Medicare Act would create a voluntary Medicare “Part E,” available to anyone under the age of 65. Along with the ability to buy the plans at cost on the state and federal Affordable Care Act (ACA) health exchanges, employers would be able to choose Medicare Part E as a viable option for their employees. Further, eligible individuals would be able to use their ACA subsidies to purchase coverage, which would be enhanced to up to 600 percent of the federal poverty level. 

Although both Sens. Merkley and Murphy have strong liberal bona fides, the bill marks an even more liberal approach than Murphy has previously taken on health care policy. Sen. Murphy acknowledged his new stance, clarifying that the Choose Medicare Act is a “common vision that both perspectives can buy into,” as it allows businesses and consumers the ability to choose a Medicare plan or decide to stay on private insurance. Sen. Merkley, for his part, has a history of supporting single-payer health care programs. Sen. Murphy predicted that if implemented, “Medicare plans may prove more popular than commercial plans, and eventually this legislation may migrate the American health care system into one in which the vast majority of Americans are on Medicare.”

This bill is dead on arrival in a Republican-controlled Senate, but it does help lay the foundation for Democrats jockeying for a position in the 2020 Democratic presidential primary. Another leading liberal voice, Sen. Bernie Sanders (I-VT), has released an even more left-leaning “Medicare for all” bill that will could force Democratic primary contenders to take nuanced stances about the scope of government-subsidized health care.  Notably, Sen. Merkley has co-sponsored Sen. Sanders bill, while Sen. Murphy has not.

Senate HELP Committee Releases Updated Opioid Response Legislation

The bipartisan leaders of the Senate Health, Education, Labor and Pensions (HELP) Committee — Chairman Lamar Alexander (R-TN) and Ranking Member Patty Murray (D-WA) — have introduced updated text for their bipartisan opioid-related bill, the Opioid Crisis Response Act of 2018. The revised text and summary reflect the proceedings of the most recent of the committee’s seven hearings as well as technical changes pertaining to agencies and programs in HELP’s jurisdiction, including the FDA, NIH, CDC, and SAMHSA. The Committee is scheduled to mark-up this proposal on April 24.

Additionally, the Senate Finance Committee is scheduled to convene a hearing on opioid matters pertaining to the Medicare and Medicaid programs later this week. Committee leaders are continuing discussions with the Senate leadership to determine potential paths to move opioid-related legislation through the chamber.

Among the key changes to the revised HELP bill: $500 million for each of the fiscal years 2019 through 2021 for the Cures Grants Program; language to clarify that doctors are allowed to share certain health information with families and caregivers during an overdose emergency; language which seeks to improve access to medication-assisted treatment; broadening of the draft language to support development of products that could “replace” the use of opioids; and more.