TRP Health Policy Report

December 1, 2014
The House and Senate were in recess last week for the Thanksgiving holiday. During an otherwise quiet week, last Friday saw Senate Democrats increase their leadership ranks to include Sen. Mark Warner (D-VA), who will serve as a policy development adviser to the Democratic Policy and Communications Committee. Warner said he will use his new seat to assure Democratic centrists their views are represented in leadership meetings. Senior Democrats said the Virginia Senator will serve as a counterweight to Sen. Elizabeth Warren (D-MA), who has built a spirited following among the party’s liberal base. 

The Week Ahead
Lawmakers return to Washington today, with just 10 days left before government funding expires. The House is likely to unveil a bipartisan continuing resolution (CR) this week, and votes in each chamber are expected by the Dec. 11 deadline. Along with work on a CR, rumors swirl about other potential deals, including a Department of Defense Authorization, tax extenders, Ebola and Syria. Given the short legislative calendar, however, there’s no certainty as to how Senate Republicans will choose to cooperate on these measures with a pending majority in 2015. Off the floor, the House Energy and Commerce Committee will meet Wednesday for a hearing on the Children’s Health Insurance Program (CHIP). Witnesses include officials from the Congressional Research Service (CRS), GAO and the Medicaid and CHIP Payment and Access Commission.
Republican Leaders Coalesce Around Plan to Avoid Shutdown
According to several high-ranking GOP aides, Republican House leaders are starting to unite around a strategy to extend most government funding through September 2015, but renew immigration enforcement on a short-term basis only. The strategy is designed to avoid a government shutdown, while allowing Republicans to express their anger at President Obama for issuing an executive order that ends deportations for millions of undocumented immigrants. The short-term funding provision would likely expire sometime in the first quarter of 2015, sources said. The delay would give GOP leaders more options to counter the President’s executive order while keeping the government open. Among GOP leaders, the plans is known as “CROmnibus”- a combination of CR, the short-term funding bill, and omnibus, the longer-term way to fund the government that includes the 12 annual funding bills.
President Obama’s executive action has infuriated conservatives, who believe he has overstepped his Constitutional authority. Some hardline Republicans have called on the House and Senate to withhold funding for the U.S. Citizenship and Immigration Services, but those employees are funded by fees, not Congressional appropriations. Republicans had hoped to use the lame-duck session of Congress – which runs from the day after Election Day until Jan. 3, 2015 – to clear away lingering legislative issues to give the party the ability advance a positive agenda in 2015. House GOP leaders have been trying to convince their rank and file that they need to be able to fight President Obama but not risk a government shutdown when the current stopgap spending bill expires on Dec. 11. Aides for the House Appropriations Committee expect to have a full year, 12-bill omnibus vehicle ready for a floor vote next week. But despite recent momentum on the issue, a spokesperson for House Speaker John Boehner (R-OH), said no final decision has been made on how the chamber will move forward on the issue.
Upton Presses for '21st Century Cures' Bill Vote by Memorial Day
On Nov. 21, Rep. Fred Upton (R-MI) told patient and pharmaceutical groups that he hopes to see a House floor vote on the long-anticipated ‘21st Century Cures’ bill before Memorial Day and on the President's desk by the end of 2015. The Energy and Commerce Committee chairman and Rep. Diana DeGette (D-CO) have been holding hearings all year on the discovery, development and delivery of new cures and treatments. Last week, they said they hope to release a legislative discussion draft in January addressing six areas of reform: integrating patients’ perspectives into the regulatory process, modernizing clinical trials, fostering the future of science, investing in advancing research, incentivizing the development of new drugs and devices for unmet medical needs, and supporting digital medicine.
Upton added that he is reaching out to the Senate to line up bipartisan support for the bill in December. “We want to get this bill enacted next year. That is our goal,” he said. “That means we need a big vote in the House to help with the Senate.” A key figure in moving the ‘21st Century Cures’ measure is Sen. Lamar Alexander (R-TN), who is expected to lead the Senate HELP panel in the 114th Congress. Industry analysts said GOP control of the Senate could mean that certain topics, like changes to FDA's structure and additional drug exclusivity, might gain more traction than they would have if Democrats remained in control.
Executive Action Extends Benefits to Immigrants
Last week, the White House confirmed that undocumented immigrants protected from deportation under President Obama's executive action will be eligible for Medicare and other benefits once they enter the federal system. The President’s action means that up to 5 million people will be considered lawfully present in the U.S. despite having entered the country illegally. The moves, affecting mostly parents and young people, marked the most sweeping changes to the nation’s fractured immigration laws in nearly three decades. It broadens the scope of undocumented immigrants who qualify for a program launched in 2012 that targeted young people brought to the U.S. as children, and also extends the suspension of deportation to undocumented immigrants who are the parents of U.S. citizens or legal permanent residents.
Despite initial claims to the contrary, a White House official confirmed to the Washington Post last week that many of those who are eligible for a deportation waiver under the new executive order also would likely qualify to get Social Security, Medicare, as well as survivor and disability benefits. That is because people who pay taxes are considered “lawfully present” in the United States. The White House stressed that the executive action beneficiaries would not be able to get federal benefits such as student financial aid, food stamps, housing subsidies, or buy health insurance through the federal health care exchange under the Affordable Care Act. But the idea of a large new group of immigrants becoming eligible for Medicare and other programs is likely to elicit further GOP criticism of the President's executive action. The White House defended his actions as a valid use of “prosecutorial discretion” exercised by President Obama’s predecessors.
Paulsen Confident of Device Tax Repeal
Last week, Rep. Erik Paulsen (R-MN) said he expects the 114th Congress to move quickly to repeal the medical device tax imposed under the Affordable Care Act (ACA). The 2.3 percent excise tax went into effect in 2013 and was intended to raise billions to help pay for the healthcare overhaul. But the IRS has struggled to collect the medical device tax and Treasury receipts from the levy have fallen well below expectations. The medical device industry has aggressively pushed for the device tax's repeal, saying it hinders job creation, reduces medical innovation and increases healthcare costs. The tax applies to most products used in clinical settings. Nationally, medical device trade associations have detailed the impact of the tax on their industry since it went into effect at the beginning of 2013. A survey by the Advanced Medical Technology Association (AdvaMed) reported job reductions of 14,000 and canceled hiring of 19,000. The Medical Device Manufacturers Association, which represents smaller companies, surveyed 150 members and found two-thirds of respondents were either cutting jobs or moving them outside of the U.S., and 47 percent of respondents said that they were cutting their R&D budgets.
Now, with GOP gains on Election Day that will put Congress completely in Republican control, device makers are optimistic Congress will repeal the tax next year. They also point to bipartisan support for repeal, with Democrats such as Sens. Charles Schumer (D-NY) and Elizabeth Warren (D-MA) responding to industry executives in their states. And while the Affordable Care Act represents President Obama's signature legislative achievement, he did not close the door on repealing the tax. “Let me take a look comprehensively at the ideas that (Republicans) present,” he told reporters the day after the Nov. 4 GOP electoral landslide. In March 2013, the Senate approved a symbolic resolution calling for repeal of the tax, with more than 30 Democrats joining Republicans in support of the non-binding measure. Bipartisan opposition to the tax is also broad in the House – a rarity in the hyper-partisan political atmosphere. House Speaker John Boehner (R-OH) and the Senate's incoming Majority Leader Mitch McConnell (R-KY) have made repealing the tax a top priority for the new Congress, which will take office in January. In his post-election news conference, McConnell declared that the tax has “exported enormous numbers of jobs” and should be abolished.
KFF Poll: Half of Uninsured Plan to Buy Coverage
According to the latest Kaiser Family Foundation tracking poll, half of uninsured people in the U.S. plan to purchase health plans during the ACA's open enrollment period, while four in 10 say they will remain without coverage. Released on Nov. 21, the Kaiser poll found that about one-quarter of all uninsured people said they do not expect to find a plan they can afford and will not enter the exchanges as a result. The figures highlight challenges for the White House now that the health law's second enrollment period is underway. Health officials have just three months to convince people to enter the exchanges and to overcome impressions that medical insurance is too expensive for people with lower incomes.
Kaiser’s November poll also found that many uninsured people appear to be in the dark about open enrollment. Despite heavy news coverage and marketing from insurers about the re-opening of enrollment, about 9 in 10 of the uninsured said they didn’t know that the health law’s open enrollment period began on Nov. 15. Other poll findings include that 46 percent of those surveyed hold an unfavorable view of the ACA and 37 percent view it favorably, a slight change from last month’s  survey, where 43 percent of those questioned held an unfavorable view of the law and 36 percent a favorable one. With the midterm elections giving Republicans control of the Senate and increasing the GOP’s majority in the House, Americans were divided about whether the debate between the two parties over the health law would increase, the poll found. Forty-seven percent expected it, while 42 percent predicted it would stay at about the same.