Health Policy Report (2/22)

February 22, 2021

Congress will resume legislative business this week as lawmakers look to check off the Biden administration’s key first 100-day priorities. The Senate will convene first this afternoon and is expected to resume consideration of pending presidential nominees for the balance of the week. Nominations that will come up for a vote include Linda Thomas-Greenfield’s nomination to be Ambassador to the United Nations and Tom Vilsack’s nomination to be Secretary of Agriculture. Senate Committees are also scheduled to hold confirmation hearings for Biden cabinet nominees this week, including California Attorney General and former congressman Xavier Becerra to lead the Department of Health and Human Services (HHS), Rep. Deb Haaland (D-NM) to be Interior Secretary, and Katherine Tai to be United States Trade Representative (USTR) Ambassador.

In the House, lawmakers will meet for votes on Tuesday as Members look to clear President Biden’s “American Rescue Plan” (text; summary) for COVID-19 relief. The House Budget Committee will convene today to piece together each committee’s legislation to comply with reconciliation instructions into the final $1.9 trillion virus aid package. Once the Budget Committee completes its work, the House Rules Committee will meet to develop the rule that will govern debate on the measure. The Rules panel will also need to ensure that the package stays within the $1.9 trillion cost threshold as the package has reportedly swelled past this limit, according to an assessment by the Congressional Budget Office (CBO). As such, consideration of the virus relief legislation is expected to begin later this week and will likely bleed into the weekend. Also on the House floor this week, lawmakers will take up a package of wilderness-related bills and the Equality Act.

Biden to Nominate Brooks-LaSure as CMS Administrator

President Biden reportedly plans to nominate Obama-era veteran Chiquita Brooks-LaSure to serve as Administrator for the Centers for Medicare and Medicaid Services (CMS). Ms. Brooks-LaSure currently works as a managing director at Manatt Health, a consulting firm, although previously she served as a senior CMS official responsible for helping implement the Affordable Care Act (ACA) and insurance market reforms. She also previously served as a Democratic staff member for the House Ways and Means Committee, where she built a relationship with HHS Secretary Nominee Xavier Becerra and served as a key drafter of the ACA. Additionally, she led President Biden’s Department of Health and Human Services transition team.

If confirmed by the Senate, Ms. Brooks-LaSure would hold the second most powerful position in the health administration and would be responsible for the $1 trillion agency responsible for Medicare, Medicaid, and large parts of the ACA. CMS will also play a central role in President Biden’s goals to expand insurance coverage by strengthening the ACA, expanding the role of Medicaid, and lowering the Medicare eligibility age to 60. Ms. Brooks-LaSure has previously advocated for Medicaid expansion, bolstered health coverage, and action to address maternal mortality. She also spent much of her time at Manatt Health advising states on how they could create public option plans.

Becerra Confirmation Battle Hits Senate Committees This Week

The Senate Finance Committee will hold a confirmation hearing for HHS Secretary nominee Xavier Becerra on Wednesday, the day after the Senate HELP committee is slated to hold a courtesy hearing to consider his nomination. While Democrats and many health care stakeholders have cheered Becerra’s appointment, the former California Attorney General has faced opposition from Senate Republicans who are reportedly targeting his nomination among the key cabinet-level positions they plan to scrutinize. In Senate floor comments in January, for example, Senate Minority Leader Mitch McConnell (R-KY) argued Becerra has been too partisan, citing his criticism of the Trump administration’s handling of COVID-19 vaccine distributions. Republicans are also expected to link Becerra to California’s troubled pandemic response, as Becerra was tasked with enforcing stay-at-home orders and other restrictions imposed by Gov. Gavin Newsom. Meanwhile, appointments to head CMS, FDA and other health agencies will remain in waiting until the HHS secretary is confirmed.

White House Increases Funding for COVID-19 Testing, Genomic Sequencing

Last Wednesday, the White House announced it would invest $1.6 billion to increase COVID-19 testing and genomic sequencing efforts, although it cautioned more funding would be needed. The White House COVID-19 Response Team explained that the funding would serve as a “bridge” to the funding allocated for testing efforts in the American Rescue Plan and help protect the country from variants of the virus. The additional $1.6 billion will be divided between three key objectives: increased domestic manufacturing of testing supplies; expanded COVID-19 testing for schools and underserved populations; and a rapid increase in virus genome sequencing.

The Department of Health and Human Services and Department of Defense will invest $815 million to increase domestic manufacturing of testing supplies and raw materials that have been subject to shortages. The departments will also invest $650 million to expand testing opportunities for elementary and middle schools, as well as underserved congregate settings like homeless shelters. HHS has been directed to establish regional coordinating centers to distribute COVID-19 testing supplies and partner with laboratories across the country. Finally, the Centers for Disease Control and Prevention (CDC) will also invest almost $200 million to identify, track, and mitigate emerging strains of COVID-19 through genomic sequencing, tripling CDC’s sequencing capabilities from 7,000 samples a week to approximately 25,000.

Sens. Kaine and Bennet Release Bill Establishing Public Option

Senators Tim Kaine (D-VA) and Michael Bennet (D-CO) announced the reintroduction of their Medicare-X Choice Act last Wednesday. The legislation would establish a national public option through an expanded Affordable Care Act and Medicare program, and would offer higher reimbursement rates for rural hospitals than earlier versions of the bill did. The public option — relying on Medicare infrastructure — would be phased in and initially available on the Exchanges to residents in areas of limited competition before being expanded to all rating areas and the small business Exchange by 2025. The Medicare Exchange plans would provide all primary care services without cost-sharing requirements for plan holders. Furthermore, the legislation would: increase and enhance ACA subsidies; allow for Medicare drug price negotiation and value-based arrangements; fix the “family glitch;” address health care market consolidation and anticompetitive practices; and more. Staff for the Senators explained they are working to build additional support for the bill and will introduce the legislation this week.

HHS Officially Delays ‘Rebate Rule’ Following Court Order

HHS has officially delayed for one year its ban on drug rebates after being ordered to do so by a federal judge. While the requirements in the new rebate rule were set to begin on Jan. 1, 2022 — the beginning of the next plan year — the Pharmaceutical Care Management Association (PCMA) said there would not have been enough time for industry to prepare by next January and asked the court to cancel the 2022 start date. The U.S. District Court for the District of Columbia agreed and on January 30 postponed the rule’s implementation for one year. The rule, which has been opposed by insurers and pharmacy benefit managers, was among several 11th hour regulations issued by the Trump administration that have been delayed or halted by the Biden administration.