Health Policy Report

March 28, 2016

The Week in Review
With the Senate in recess for the Easter holiday, the House elected to take a short week before leaving for their own two-week break on Wednesday. The key legislative action involved passing a bill (H.R. 2745) adjusting the legal authority for the Federal Trade Commission (FTC) to halt business mergers and issuing a resolution (H. Res. 658) condemning the terrorist attacks in Brussels, Belgium and offering American assistance in tracking down those responsible. The FTC legislation – which would hold the agency to the same legal standard as the Justice Department’s Antitrust Division in order to halt a merger – passed on a largely partisan vote of 235-171. If enacted, the bill would eliminate the FTC’s use of administrative proceedings to challenge mergers, addressing the concerns of the business community in having a deal challenged in both federal court and before an administrative law judge. The White House has expressed its opposition to the bill, but stopped short of issuing a veto threat in its statement on the measure. 

Away from the House floor last week, appropriators officially began work on the first of twelve appropriations bills, but it remains unclear whether House Republicans will be able to mend their differences and advance a budget resolution in this election-shortened session. Speaker Paul Ryan (R-WI) has attempted to woo his more conservative colleagues on the establishment’s budget resolution – passed by the House Budget Committee earlier this month – that would abide by the spending levels agreed to in the 2015 Bipartisan Budget Act and submit a legislative “sidecar” with $30 billion in cuts. House Freedom Caucus members are skeptical of that plan, but are looking at other vehicles – such as the Federal Aviation Administration’s reauthorization – in order to get additional budget cuts through Congress.
For a complete breakdown on where budget negotiations stand heading into the Easter break, see last Wednesday’s post on the TRP Blog.  
The Week Ahead
Both chambers of Congress are in recess for the Easter holiday. The Senate is expected return on Monday, April 4, while the House is expected to reconvene a week later on Monday, April 11.
House Panel Portends GOP Reluctance on Opioid Legislation
Interparty rifts emerged last week as the House considered its path forward on bipartisan legislation to combat opioid abuse and addiction. At a House Committee on Oversight and Government Reform hearing Tuesday, members discussed how to best address the epidemic following the Senate’s passage of a bill earlier this month, the Comprehensive Addiction and Recovery Act (S. 524) (CARA). The Senate bill authorizes the administration to offer grants to states to expand their treatment offerings, increase access to naloxone (an overdose prevention drug), and give the Justice Department additional tools to combat drug trafficking.
While the Senate voted overwhelmingly in support of CARA – passing the measure by a 94-1 vote – Tuesday’s hearing offered evidence that the House might view the opioid bill less favorably. While Democrats attributed the increase in deaths related to prescription painkillers and heroin to a lack of access to treatment and overdose-prevention drugs, Republicans did not seem to view the lack of treatment as a priority. Instead, they focused on the need to stop drug traffickers, the liberalization of marijuana laws, and the decrease in the number of drug-related prosecutions in recent years.
When the Senate considered CARA earlier this month, some Democrats in the chamber signaled that they might withhold support due to the absence of $600 million in emergency supplemental funding. Tuesday’s hearing provided evidence that House Democrats are also likely to pursue this fight. On the other hand, Rep. John Mica (R-FL), Chairman of the Subcommittee on Transportation who presided over the hearing in the absence of Chairman Jason Chaffetz (R-UT), argued that the 2016 ‘omnibus’ spending bill had included $400 million for heroin and opioid abuse programs, and that those sums had not yet been utilized.
Congressional action to combat opioid abuse comes as the Obama Administration expanded its own efforts to curb the growing epidemic.  This month, the Centers for Disease Control and Prevention (CDC) issued new prescribing guidelines for opioids, which may help doctors and patients better understand the risks associated with prescription painkiller use.  In addition, the Administration requested more than $1 billion in new mandatory funding in next year’s budget to address opioid drug abuse. And just as last Tuesday’s hearing was occurring, the Food and Drug Administration (FDA) announced changes to the safety warnings are required on the labels of prescription painkillers – the labels must now include a boxed warning about risks of misuse, addiction, overdose and death.  FDA also revealed new steps to scrutinize applications for opioids.
House Leaders Urge Senate to Pass ‘Cures’ Package By July 4 Recess
At a forum last Wednesday, House Energy & Commerce Committee Chairman Fred Upton (R-MI) and Rep. Diana DeGette (D-CO) urged Congress to pass a bill that combines the House’s 21st Century Cures Act and the Senate’s Innovation for Healthier Americans Act before the July 4 recess in order to avoid election turbulence that could overshadow the effort. While the House passed the 21st Century Cures Act last summer, the Senate is planning to hold its “Innovation Package’s” third and final markup April 6 before bringing a final package to the Senate floor. The Senate Health, Education, Labor, and Pensions (HELP) Committee has already held two markups of several innovation bills as part of its Innovation for Healthier Americans initiative, and Chairman Lamar Alexander (R-TN) has said he plans to combine a number of additional innovation bills at the third markup, after which he hopes to bring the package to the Senate floor, and then allow the two chambers to work out differences between their bills during conference.
Energy & Commerce Committee Ranking Member Frank Pallone (D-NJ), who was also at Wednesday’s event, noted that House lawmakers have told Vice President Joe Biden, along with HELP Committee Chair Alexander and Ranking Member Patty Murray (D-WA), that they want to “marry the two bills” and include legislation to support the Vice President's cancer initiative.
Chairman Upton and Rep. DeGette's push comes shortly after several top officials for Public Citizen expressed their concerns to the HELP Committee that the upper chamber might pass a number of small bills as a counterpart to the 21st Century Cures Act in an effort to conference with the much broader House bill, which includes some provisions the group does not support.
Alexander Introduces Bill Supporting Obama’s Precision Medicine Initiative
Senate HELP Committee Chairman Lamar Alexander (R-TN) has unveiled legislation to support President Obama’s Precision Medicine Initiative by encouraging the collaboration of scientists to further the initiative’s goals. The legislation requires the Department of Health and Human Services (HHS) to implement policies to encourage the safe collection of information across systems in order to support the Initiative’s goal of engaging a “cohort” of a million or more volunteers to better understand health and disease.  The release of the legislation came just days after Vice President Joe Biden announced the selection of Greg Simon, FasterCures co-founder and Poliwogg executive, to head the White House’s cancer initiative task force that shares a similar goal of promoting data sharing across systems.
When the cancer task force was launched in January, Sen. Alexander said the group, along with the administration's Precision Medicine Initiative and the 21st Century Cures Act, sets the stage for the upper chamber to move bipartisan medical innovation legislation to the president's desk.  The Precision Medicine Initiative, which launched in 2015, calls on the Office of the National Coordinator for Health IT to support the development of interoperability standards and requirements that address privacy and enable secure exchange of data across systems.  The Initiative additionally directs the National Cancer Institute to scale up efforts to identify genomic drivers in cancer, and FDA to acquire additional expertise and advance the development of databases to support the regulatory structure needed to advance innovation in precision medicine.
AARP Backs Controversial CMS Part B Drug-Pay Demonstration
AARP, the influential seniors lobby, announced its support Wednesday for the Centers for Medicare and Medicaid’s (CMS) Part B drug-pay demonstration proposal, which would restructure the Part B physician add-on payment by creating a combination of a flat fee and a lower percentage rate of the drug price. The proposal generated immediate opposition from numerous industry, provider and patient advocacy stakeholders. In a statement, PhRMA, the pharmaceutical industry trade organization, stated that “proposing sweeping changes to Medicare Part B drug reimbursement without thoughtful consideration and stakeholder input is not the right approach and puts Medicare patients who rely on these medicines at risk.” Likewise, the American Society of Clinical Oncology’s CEO Allen Lichter said "[It] is inappropriate for CMS to manipulate choice of treatment for cancer patients using heavy-handed reimbursement techniques. Physicians did not create the problem of drug pricing and its solution should not be on their backs."
Taking the opposite position, AARP chief advocacy and engagement officer, Nancy LeaMond, stated Wednesday, “We cannot continue to ask taxpayers and Medicare beneficiaries to pay for exorbitantly priced prescription drugs without any consideration of whether their money is being well-spent.” She also said many of the changes CMS is considering are already used in the private sector, and that the proposed model will not prevent doctors from prescribing medications patients may need. Furthermore, she noted that there is an exceptions process included in the model that will allow providers and beneficiaries to get medically-necessary drugs and that CMS' proposal has multiple opportunities for public comment. She also argued that CMS will keep beneficiary cost-sharing the same with an option of reducing or waiving cost-sharing and that demonstration is also not a permanent change to Medicare.
Along with their adjustments to the add-on payment, CMS officials are also soliciting input on five other drug-spending approaches they are considering testing in the second phase of the pilot, which would begin as early as January 2017. Those policies include paying the same amount for therapeutically similar drugs; discounting or eliminating patient cost-sharing; adjusting payment for drugs based on how well they work; adjusting payment based on the diseases they're prescribed for; and creating new prescribing guidelines.
HHS Report Reveals Medicare Saved $473 Billion from Cost Slowdown
On the sixth anniversary of the Affordable Care Act (ACA) Tuesday, the Department of Health and Human Services (HHS) announced that federal healthcare spending has slowed since the passing of the healthcare law. In their announcement, HHS reported that reforms to Medicare payment methodologies helped the program spend $473 billion less between 2009 and 2014 than it would have if previous cost-growth trends had continued.  The agency said a number of factors have played a role in the cost slow down, but that a major driver was the focus on paying for the quality of care rather than the volume of services provided. In addition, the agency pointed to the economic slowdown coming out of the recession, as well as cuts to Medicare as two other major factors. Notably, the increase in health spending per person reached historic lows of around three percent beginning in 2010, before increasing to 4.3 percent in 2014 because of spending on the ACA’s coverage expansion and new high-cost hepatitis C drugs.