Health Policy Report (8/5)

August 5, 2020

Capitol Hill Update

Negotiations on the next round of COVID-19 relief legislation yielded no progress over the weekend as officials struggle to coalesce behind a bipartisan agreement. White House Chief of Staff Mark Meadows and Speaker Nancy Pelosi (D-CA) each acknowledged that their sides have a long way to go toward reaching a deal on the next relief package. Meanwhile, President Donald Trump is remaining steadfast on his desire to see a smaller relief package that would address the expired unemployment benefits, extend the moratorium on housing evictions, and provide another round of direct payments — an approach that has been rejected by House Democrats thus far. As the sides remain far apart on the size and scope of the next package, it remains to be seen whether the talks can produce a bipartisan agreement by week’s end.

Prior to adjourning last week, Senate Majority Leader Mitch McConnell (R-KY) queued up a legislative vehicle that could carry a potential deal on renewing the enhanced unemployment insurance benefits, as well as other pandemic-related items. Senators will take up amendments to the underlying bill next week, with Republicans preparing offers that would scale back the enhanced $600 per week benefit. In particular, Sens. Ron Johnson (R-WI) and Mike Braun (R-IN) are expected to offer an amendment that would push the weekly boost back to $200, and Sen. Mitt Romney (R-UT) will offer a proposal that would provide states with either an 80 percent wage replacement plan or a sliding weekly benefit of an extra $500 increase each week in August, $400 each week in September and $300 each week in October. Meanwhile, House Majority Leader Steny Hoyer (D-MD) announced that the lower chamber will not begin its previously-scheduled August district work period until a deal on COVID-19 relief legislation is reached. Members will receive at least 24 hours’ notice of any scheduled votes in August.

Senate Republicans Introduce COVID-19 Response Legislation

Last Monday, Senate Republicans officially introduced their opening offer proposal for the next round of COVID-19 relief legislation following days of intraparty negotiations between GOP Senators and White House officials. The legislative package was officially released as multiple pieces of legislation, with six total sections: 1) Appropriations (text; summary); 2) Finance (text; summary); 3) Small Business (text; summary); 4) HELP (text; summary; child care one-pager; student loan one-pager; Education Freedom Scholarship one-pager); 5) Liability (text; summary); and 6) Supply Chain (text; summary). The Health, Economic Assistance, Liability protection, and Schools (HEALS) Act totals roughly $1 trillion in relief aid priorities, including $226 billion in supplemental appropriations for Labor-HHS, additional funding for targeted Paycheck Protection Program (PPP) lending, as well as another round of economic impact payments. The bill also provides an extension of the enhanced unemployment insurance benefits but lowers the weekly federal boost from $600 to $200, setting up a potential standoff with House Democrats who have been pushing for a clean extension of the current benefits. With negotiations on the next COVID-19 package underway in earnest, TRP has developed a side-by-side that compares proposals on certain COVID-19 relief policies from the Senate’s HEALS Act and the House Democratic HEROES Act (TRP summary; health-specific summary). Click here to view the side-by-side.

Out of the $306 billion allocated toward additional supplemental appropriations, $226 billion of that funding is earmarked for Labor-HHS-Education. It would boost funding for the Public Health and Social Services Emergency Fund, including $25 billion in new money for the Provider Relief Fund. Other health-related funding priorities include: (1) $16 billion for testing; (3) $26 billion for vaccine research, distribution, and use; (4) $25 billion for the provider relief fund; (5) $4.5 billion for mental health, suicide prevention, and overdose response programs at Substance Abuse and Mental Health Services Administration (SAMHSA); (6) $7.6 billion for community health centers; and (7) $1.6 billion for the Indian Health Service. Additionally, the measure would delay the timeline for Medicare providers to repay “advance payment” loans made available in the CARES Act, pushing back the start date from August 1, 2020 to January 1, 2021. To prevent a spike in Medicare Part B premiums for 2021, the proposal would hold the premium that’s in place for 2020. Additionally, the measure would allow individuals to roll over unused flexible spending account (FSA) money from 2020 into 2021. 

The bill would also permit HHS to extend waivers that expanded Medicare telehealth access during the pandemic through December 31, 2021, if that is later than the end of the public health emergency (PHE). It would maintain telehealth expansions specific to federally qualified health centers (FQHC) and rural health centers (RHC) for five years beyond the end of the PHE. The Medicare Payment Advisory Commission (MedPAC) would be directed to submit a report to Congress on the impact of the telehealth flexibilities on health care access, quality, and cost by July 1, 2021. Taken together, these provisions would allow Congress more time to deliberate on maintaining the massive expansion of telehealth in Medicare during the pandemic and head off an abrupt end to the flexibilities. Additionally, The bill contains a host of provisions that seek to boost domestic production capacity, including: (1) a 30 percent investment tax credit for PPE made in the U.S.; (2) requiring the Strategic National Stockpile to purchase PPE and other medical supplies domestically; and (3) supporting domestic manufacturing surge capacity. It would also establish state stockpiles of supplies including ventilators, PPE, and various medical products. The bill includes $5.3 billion in supplemental Defense appropriations that would be earmarked for COVID-19 Defense Production Act (DPA) purchases.

Last-Minute Push to Include Surprise Billing Fix in COVID Relief Faces Hurdles

Lawmakers huddled over the past week in a last-minute attempt to work out a legislative solution to surprise billing for inclusion in the latest COVID-19 relief bill — which many view as the last major policy vehicle before the 2020 election. Relevant committees and House Speaker Nancy Pelosi (D-CA) held discussions on a potential solution earlier last week, but it remains unclear whether they will be able to reach a consensus in time for the next relief package. A bipartisan group of committee leaders from both chambers — including Senate HELP Chairman Lamar Alexander (R-TN), Senate HELP Ranking Member Patty Murray (D-WA), House Energy & Commerce Chairman Frank Pallone (D-NJ), Energy & Commerce Ranking Member Greg Walden (R-OR), House Education & Labor Committee Chairman Bobby Scott (D-VA), and Education & Labor Ranking Member Virginia Foxx (R-NC) —publicly advocated for an approach that combines a market-based benchmark payment with an arbitration backstop. Congressional aides have warned that Senate Majority Leader Mitch McConnell (R-KY) is unlikely to include a benchmarking fix onto the relief bill for fear it will divide his caucus and make negotiations more difficult.

The Department of Health and Human Services released a report last Wednesday advocating for Congress to pass a legislative fix for surprise billing, but did not specify whether that fix should rely on arbitration or set payment rates to settle out of network payments. The administration argued that additional transparency measures and COVID-related surprise billing measures advanced by the administration are insufficient, and HHS Secretary Alex Azar declared “its time for Congress to do what we all agree is necessary.” Rather than specify a solution, the report adds additional confusion to the politically sensitive debate by highlighting similarities between the three leading legislative fixes and noted they all fit the administration’s required criteria for support. Additionally, the HHS report did not include evaluation of an open-ended surprise billing ban previously supported by the White House. A senior HHS official noted that the administration “purposely tried to avoid being determinative in respect to what we think the exact legislative outcome should be knowing that is an active issue before the Congress.”

Public Charge Rule Blocked Throughout COVID-19 Public Health Emergency

Last Wednesday, a federal district judge blocked the Trump administration from implementing, enforcing, or applying the Public Charge Rule nationwide throughout the declared COVID-19 public health emergency. Several states sued against the rule —which would expand the federal ability to deny green cards or visas to legal immigrants based on their potential use of federal benefits —and received temporary injunction, but the Supreme Court later lifted the ban to allow implementation while the larger lawsuit proceeded. U.S. District Judge George Daniels on Wednesday sided with New York, Connecticut, Vermont, and New York City, who asked for another injunction due to the coronavirus pandemic. Judge Daniels argued that “what were previously theoretical harms have proven to be true,” and stated that “we no longer need to imagine the worst-case scenario; we are experiencing its dramatic effects in very real time.” Additionally, the District Judge issued a separate ruling temporarily blocking a State Department rule requiring foreigners applying for immigrant visas to prove they have “approved health insurance.”

Trump Administration Announces ‘Warp Speed’ Partnership With Sanofi, GSK

The Departments of Health and Human Services and Defense announced a new “Operation Warp Speed” partnership with Sanofi and GlaxoSmithKline (GSK) to support advanced development of a COVID-19 investigational adjuvanted vaccine. The drug manufacturers will be awarded $2.1 billion for the production of COVID-19 vaccines for up to 50 million individuals, tests, and treatments. The funding is the largest grant awarded by Operation Warp Speed to date. The drug manufacturers’ vaccine will require two doses at a cost of about $42 per person, and the deal will allow the federal government to order 500 million more doses from the companies at an unspecified price. HHS Secretary Alex Azar noted in the announcement that supporting the creation of more than one vaccine will increase the odds that the U.S. will have “at least one safe, effective vaccine as soon as the end of this year.” French officials said it would be “unacceptable” for Americans to be the first to receive Sanofi’s vaccine — as the company is French — after Sanofi CEO Paul Hudson stated in May the company would likely provide its vaccine to the U.S. first because it was the first to provide funding.

CMS Seeks Input on EPCS Requirements

Last Thursday, the Centers for Medicare and Medicaid Services released a request for information (RFI) seeking feedback on exceptions to electronic prescribing requirements in the SUPPORT Act. Providers will be required to implement electronic prescribing for controlled substances (EPCS) beginning in 2021, and CMS is asking stakeholders how the requirements can be implemented with minimal burden during and after the COVID-19 public health emergency (PHE). Stakeholders are encouraged to submit comments to CMS, and the comment period on the RFI will be open for 60 days following its publication in the Federal Register. CMS is asking commenters to provide feedback on issues including: challenges in incorporating electronic prescribing into normal workflows; waivers to the EPCS requirement that should be granted; what penalties would be appropriate for noncompliance and delivered through what mechanisms; at what point enforcement actions would be warranted for noncompliance; and non-enforcement mechanisms to encourage EPCS.