Health Policy Report

The Week in Review
 
Competing approaches to resolving the highway funding challenge emerged in Congress last week, with the House and Senate taking different approaches to the issue. The House passed its version (H.R. 3038) in a 312-119 vote, providing $8 billion in funding for the Highway Trust Fund, which would allow it to continue operating through the end of 2015. Meanwhile, the Senate is aiming to pass a longer-term deal that would give $275 billion in highway funding over a period of six years. Both plans face significant hurdles; the House version includes unrelated offsets in tax adjustments drawing the criticism of conservatives and the Senate bill has been linked with the ongoing controversy over the Export-Import Bank.

Other action in Congress last week included the Senate passing a rewrite of “No Child Left Behind” (S.1177) by an impressive margin, 81-17. Compared to the House version (H.R. 5) passed earlier this month, the Senate’s bill hews less to the conservative doctrine and stands a better chance of becoming law. Apart from their action on transportation, the House passed a bill (H.R. 2898) 245-176 giving California water managers greater flexibility in their efforts to combat the severe drought that has plagued the state, but the measure has been criticized by some environmentalists who fear it undermines existing protections for wildlife.
 
The Week Ahead
 
Senate leaders will begin the week with further consideration of their highway funding measure, with Majority Leader Mitch McConnell (R-KY) setting up a cloture vote on H.R. 22—which will serve as a legislative vehicle for the transportation package—for Tuesday. Rumors have also emerged that McConnell is working with Sen. Barbara Boxer (D-CA) on a compromise deal that would maintain the highway fund for two to three years. The renewed effort may be an attempt to avoid opposition from Sen. Ted Cruz (R-TX), who has sworn to use procedural tools to prevent any highway legislation that also renews the Export-Import Bank.
 
Meanwhile, House Majority Leader Kevin McCarthy (R-CA) has scheduled consideration of a bill (H.R. 1734) that would give states greater authority in regulating the disposal of coal ash, a waste product from coal-fueled power plants. It remains unknown whether House leadership will bring the Interior-Environment spending bill (H.R. 2822) back to the House floor after it was caught in a controversy over an amendment banning the Confederate flag from Capitol grounds and national cemeteries. Finally, hanging over both houses of Congress will be the Obama Administration’s recent deal curbing Iran’s nuclear program in exchange for sanctions relief – a deal which has received sharp criticism from Republicans. Once the finalized agreement is submitted to Congress, the legislature will have 60 days to consider and either reject or approve the deal, but a rejection would likely be subject to a White House veto.
 
Reconciliation Likely to Wait until After August Recess
 
Republican leadership cleared up some issues last week on the use of a budgetary process known as reconciliation—which avoids the 60-vote filibuster hurdle typically required of major legislation—for a repeal of the Affordable Care Act (ACA). On July 10, House Ways and Means Committee Chairman Paul Ryan (R-WI) definitively said that Republicans “want to use reconciliation to go after ObamaCare,” but qualified the statement by saying a full repeal may be beyond the capacity of reconciliation.
 
On Wednesday, House Budget Chairman Tom Price (R-GA) asserted that reconciliation legislation will wait until after the August recess, with the House and Senate committees tasked with submitting reconciliation proposals reportedly intending to blow by a July 24 deadline set by the fiscal 2016 budget resolution. Reconciliation itself has no deadline, but pressure to force through an ACA repeal will continue to build throughout the recess period.
 
The delay may be due to a packed July schedule in Congress, with highway funding, education, and the Iran deal all taking precedence. Timing is not the only issue in the reconciliation debate, however, as there is some disagreement among Republicans on whether reconciliation would be put to better use to pass a measure the President is more likely to sign. This includes more minor changes to the health care law, such as a repeal of the medical device tax, which is unpopular among many Democrats as well as Republicans. Many Democrats are open to making changes to the law, but given the rare opportunity reconciliation presents, anything short of a full repeal may be seen as disappointing to the Republican base.
 
After GAO Report, Republicans Voice Concerns on ACA Exchange Controls
 
In a hearing of the Senate Finance Committee last Thursday, a Government Accountability Office auditor revealed the results of an undercover probe of the federal insurance exchange, showing that the drive to increase access often outweighs ensuring that applicants actually qualify for subsidies. While Democrats downplayed the report and insisted that its findings did not represent the law as a whole, Republicans seized on the opportunity to criticize the law – and its primary implementer, the Centers for Medicare and Medicaid Services (CMS).
 
This latter point may be particularly pertinent to CMS Acting Director Andy Slavitt, as he was recently nominated by President Obama to keep the job permanently. Some Republicans suggested that the probe results, in which auditors used fake identities to obtain subsidized coverage in 11 of 12 attempts, will be a topic of discussion at Slavitt’s confirmation hearing. Republicans also alleged that CMS did not cooperate with the investigation fully, with Sen. Orrin Hatch (R-UT) asserting he would ask Slavitt “why CMS has been interfering with our oversight efforts.”
 
Funding In Question as NIH Readies Precision Medicine Initiative
 
The National Institutes of Health’s ambitious undertaking to establish a research cohort for personalized medicine may face budgetary constraints if Congress funds the government through a continuing resolution starting October 1. A $200 million request for precision medicine in President Obama’s budget was accepted by House and Senate appropriators, and the sweeping medical research bill 21^st Century Cures (H.R. 6) also includes some precision medicine measures. However, both would be jeopardized if Congress is unable to pass the necessary appropriations measures, with the NIH admitting that “plans could change” if fiscal 2015’s funding level is extended past October 1.
 
The initiative itself was presented to the President earlier this month, and the NIH claims that a more detailed plan outlining the logistics of the research cohort will be available in mid-August. Precision medicine has been touted as an emerging field that may spare patients from expensive and invasive treatments by developing personalized, targeted therapies. Access to the therapies remains a problem, with expensive testing and regulatory obstacles often preventing patients from receiving the innovative treatment. The Administration and Congress have made an effort to address this dilemma, but it seems that even the bipartisan precision medicine initiative is not immune from the budgetary vortex in Washington.
 
Tavenner To Replace Ignagni As AHIP CEO
 
Marilynn Tavenner, an Obama Administration official who played a key role in the rollout of the ACA, was named as the CEO of America’s Health Insurance Plans (AHIP) on Wednesday. Tavenner was unanimously confirmed by the AHIP Board of Directors and will take over as the top lobbyist for one of the insurance industry’s primary trade groups. The new AHIP head left CMS in January after a contentious tenure as CMS administrator and was picked for the AHIP position in May after then-CEO Karen Ignagni announced she was leaving the powerful industry organization. The change at the top of AHIP is just the latest in a series of moves among the top healthcare advocacy stakeholders in Washington, with the Pharmaceutical Research and Manufacturers of America and the American Hospital Association both seeing the retirement of their CEOs in recent months.
 
Study Reveals 34 Percent Fewer Providers Covered under ACA Plans
 
A study released this week from Avalere Health found that plans purchased through the ACA offer 34 percent fewer providers than the average for commercial plans. Avalere’s study will provide new ammunition for opponents of the sweeping health care law, as narrower networks have been a common criticism of the legislation since its enactment in 2010. The data, taken from offerings for the 2015 plan year, shows that ACA plans on average cover 42 percent fewer oncology and cardiology specialists, 32 percent fewer primary care providers, and 24 percent fewer hospitals than their commercial counterparts from outside the exchanges. While out-of-network care is associated with higher out-of-pocket costs, advocates claim that the narrower networks help keep premiums low and that most ACA enrollees are satisfied with the coverage included in their plans.