Health Policy Report

January 28, 2019

The Week in Review

The longest government shutdown in U.S. history finally came to an end after President Trump signed a short-term continuing resolution (CR) over the weekend. The measure — which does not include additional border wall funding — funds shuttered federal departments and agencies through Feb. 15, providing lawmakers with additional time to hammer out a broader deal.

President Trump announced his support for ending the partial shutdown after major U.S. airports began experiencing delays on Friday due to the lack of air traffic control personnel. The decision also came one day after the Senate failed to pass the President’s proposed deal (textsummary) which would have provided $5.7 billion for his border wall priority in addition to temporary protections for young immigrants enrolled in the Deferred Action for Childhood Arrivals (DACA) program and Temporary Protected Status for refugees.

Heading into next week, it remains to be seen whether or when Congress will hold the State of the Union (SOTU) which was originally scheduled for Tuesday, Jan. 29. During the shutdown, Speaker Nancy Pelosi (D-CA) formally rescinded her invitation to President Trump to give the SOTU, writing that the House will not consider a resolution authorizing him to deliver his address until the government has reopened. President Trump agreed to put off the SOTU until after the shutdown, adding that he was no longer looking for “an alternative venue” for the speech.

The Week Ahead

Both chambers of Congress are set to resume legislative business today. In the House, lawmakers are set to take up three suspension bills out of the financial services committee: (1) a bill (H.R. 624) that would require the Securities and Exchange Commission (SEC) to carry out a study of Rule 10b5–1 trading plans; (2) a bill (H.R. 502) that would require the Comptroller General of the United States to carry out a study on how virtual currencies and online marketplaces are used to facilitate the financing of goods or services associated with illicit trafficking; and (3) a bill (H.R. 56) that would create an independent Financial Technology Task Force to combat terrorism and illicit financing. For the balance of the week, House lawmakers are set to work on a bill (H.R. 790) that would provide a pay increase for federal workers.

In the upper chamber, Senators will resume consideration of a Middle East policy bill (S.1) that would impose sanctions on Syria and provide assistance to Israel. Additionally, Lawmakers are expected to begin a conference committee on a Department of Homeland Security (DHS) spending bill, where lawmakers have agreed to find ways to boost border security funding. If the final agreement does not include adequate border wall funding, the President stated he would either shut down the government again or declare a national emergency that he says would give him the authority to build a wall without Congressional approval. 

FDA Releases Final Guidance to Modernize 501(K) Pathway for Medical Devices 

Last Tuesday, the Food and Drug Administration (FDA) released a final guidance establishing the framework for the Safety and Performance Based Pathway. The “modernized” pathway — previously known in draft guidance as “Expansion of the Abbreviated 510(k) Program: Demonstrating Substantial Equivalence through Performance Criteria” — will expand manufacturer conformity to FDA-recognized consensus standards in the approvals process.

FDA Commissioner Scott Gottlieb reiterated in a statement that “new medical devices coming to market under the 510(k) pathway should either account for advances in technology that can improve the safety or performance of these products, or demonstrate that they meet more modern safety and performance criteria.” He also said the agency believes the new approach may drive greater market competition to develop safer devices.

Additionally, the FDA issued a notice on the FDA website requesting stakeholder input on potential approaches to incentivize plan sponsors to cover devices with the latest improvements and advancements. The agency suggested — in addition to the information in the 510(k) database — that there be a publicly posting of a list of FDA-cleared devices that demonstrated substantial equivalence to older predicate devices on its website, and asked that all comments be submitted by April 22, 2019.

President Trump Vows to Stop Balance Billing

Last Wednesday, President Trump told administration officials and a gathering of patients who had received large hospital bills that he would investigate how to prevent surprise medical bills, and “stop all of it.” At a White House roundtable on high medical costs, he asked that the administration work towards ensuring patients know “exactly what the cost is” before they receive care. The issue is seen as an area of possible bipartisan cooperation, as members from both sides of the aisle have revealed bills aimed at taking down surprise medical bills.

Sen. Bill Cassidy (R-LA) unveiled bipartisan legislation to end surprise medical bills in September and Sen. Maggie Hassan (D-NH) has legislation on the topic, as well. Additionally, Rep. Lloyd Doggett (D-TX) also has a bill in the House to crack down on the practice. Labor Secretary Alex Acosta and HHS Secretary Alex Azar both touted policies already implemented by the administration, including: last year's expansion of association health plans; the new requirement for hospitals to publish the prices of procedures; and the forthcoming final rule for drug makers to disclose their list prices on their TV ads. President Trump also touched on the topic of drug pricing, and declared that he did not understand why brand drugs were paid for, as there is “literally no difference” from the generic.

FDA Releases Draft Guidances on REMS to Address Impact on Patient Access, Provider Knowledge

The Food and Drug Administration (FDA) released two draft guidances aimed at ensuring that drug and biologic manufacturers’ Risk Evaluation and Mitigation Strategy (REMS) programs are working without limiting patient access or increasing burden on the health care system. In releasing the documents, FDA Commissioner Scott Gottlieb explained that the risk management programs — put in place as a requirement of a drug’s or biologic’s approval — are essential in order to minimize negative impact on patient access and burdens on health care providers.

The draft guidances will provide a framework for companies to develop a REMS Assessment Plan at the same time that the REMS program is being developed. Commissioner Gottlieb noted that the dual development will help improve the quality of the information used to assess the effectiveness of a REMS program and provide post-market evidence that the REMS is meeting its risk mitigation goals. 

Commissioner Gottlieb stressed the importance of developing and implementing rigorous ways to assess the effectiveness of REMS in real-world settings. He said the FDA is committed to ensuring REMS are achieving their public health goals and clarified that there “is still much to learn about the science of risk management.” The FDA Commissioner stated that “there’s no ‘one-size-fits-all’ approach to assess REMS programs, as each REMS assessment is specifically designed for the specific REMS program. As with any public health initiative, evaluating the effectiveness of a REMS is an iterative process consisting of periodic assessment and REMS modification if necessary.”