FEDERAL HEALTHCARE AGENCIES BRACE FOR DISRUPTION AS GOVERNMENT SHUTDOWN LOOMS

House Republicans will gather tonight for a GOP-only meeting to plot strategy on passing a stopgap budget bill, but a breakdown among key senators on separate immigration legislation has elevated the risk of a government shutdown at week’s end.

Washington runs out of money Friday night, and that means all but essential government services, including Health & Human Services (HHS) and its agencies, would close. In previous shutdowns, the Food and Drug Administration (FDA) furloughed about half its workforce and stopped inspections, enforcement actions and monitoring operations. FDA this week is expected to release a memo outlining what would happen to advisory committees and agency user-fee activities during a shutdown.

Under the last government shutdown, in 2013, the Centers for Medicare & Medicaid Services (CMS) processed Medicare provider claims, and most agency functions were deemed “essential” and continued during the closure. But some CMS activities – like healthcare fraud and abuse investigations and certain provider certifications – did stop during that shutdown.

Congressional leaders, including House Speaker Paul Ryan and Senate Majority Leader Mitch McConnell, said they won’t allow a shutdown. But rank-and-file lawmakers warn the budget brinkmanship is real, and they say the partisan and policy impasse could prompt a closure.

Because any spending legislation needs Democrats’ votes in the Senate, Democrats are using that leverage to try to address the immigration status of so-called “Dreamers.” But lawmakers appear far from an immigration deal, and House Republicans are splintered over how to handle the stopgap spending issue.

HOUSE TO VOTE THIS WEEK ON SIX-YEAR CHIP RENEWAL

House Energy and Commerce Committee Chairman Greg Walden, R-Ore., said the House would vote this week on a six-year extension of the Children’s Health Insurance Program (CHIP).

Walden’s announcement was intended in part to address the growing clamor from governors, children’s hospitals and children’s advocates that Congress renew the program, which expired in September. But the six-year renewal bill in the House also was designed to head off potential Senate consideration of a longer CHIP renewal.

Senate Finance Committee Chairman Orrin Hatch, R-Utah, and the committee’s top Democrat, Sen. Ron Wyden, D-Ore., have discussed a longer-term extension – perhaps as long as 10 years. Walden is cool to the idea of a long-term CHIP renewal because a 10-year reauthorization would essentially put CHIP on autopilot for a decade. He wants a shorter-term extension so Congress can evaluate the program and make changes more frequently.

But because CHIP has been a political football this year – the program expired in September and received a one-time cash infusion in December – some lawmakers are pushing for the 10-year extension. Walden’s Democratic counterpart on the committee, Rep. Frank Pallone, D-N.J., said Congress should adopt the longer renewal.

It’s not clear whether House Republicans will package CHIP with a short-term spending bill to try to attract Democrats to support the spending legislation, which the GOP on its own may not be able to pass.

FEW BUMPS FOR AZAR IN SENATE CONFIRMATION HEARING

Alex Azar mostly breezed through his Senate Finance Committee confirmation hearing last week, paving the way for the panel to vote this week on his nomination to be HHS secretary.

The committee will vote on Azar’s nomination Wednesday.

During last week’s hearing, the committee’s top Democrat, Sen. Ron Wyden, D-Ore., did try to pin responsibility on Azar for Eli Lilly raising drug prices when Azar ran the company’s U.S. operations. Sen. Claire McCaskill, D-Mo., also sparred with Azar over whether the government should be able to negotiate drug prices with manufacturers.

Azar, who previously served in two senior HHS positions during the Bush administration, came off as both knowledgeable and reasoned. Two Democratic senators not on the committee – Sens. Joe Manchin, D-W.Va., and Heidi Heitkamp, D-N.D. – announced their support for Azar’s confirmation.

RYAN ACKNOWLEDGES GOP WON’T PUSH MEDICARE, MEDICAID CHANGES THIS YEAR

House Speaker Paul Ryan conceded last week that congressional Republicans are not likely to address major entitlement reforms this year for Medicare and Medicaid.

The challenge for Republicans is crafting reform legislation that could win 60 votes in the Senate, where the GOP holds only a 51-seat majority. And there seems little appetite among GOP leaders to try to approve a separate budget blueprint that would authorize reconciliation legislation, which needs only a simple majority to pass the Senate.

Still, House conservatives are pressing their leaders to push for a Medicaid overhaul as part of comprehensive welfare reform. Even if the effort passes only the House and doesn’t become law, these conservatives say it will demonstrate to voters Republicans’ policy goals and boost their political fortunes in November’s midterm elections.

HOUSE PANEL RELEASES 340B REPORT, PLEDGES LEGISLATIVE ACTION

The leader of the House Energy and Commerce Committee last week pledged to push for reforms of the 340B prescription drug discount program, which he said has grown uncontrollably.

Chairman Greg Walden, R-Ore., said the program has expanded beyond what Congress intended when it created the program in 1992. Walden’s committee also released an 80-page report that chronicles the program’s growth and outlines recommendations for changes.

Walden said he intends to move legislation in the coming weeks implementing some of the recommendations, including boosting the oversight authority of the Health Resources and Services Administration, which is responsible for the 340B program; requiring covered entities to use program savings in specific ways to improve patient care; and boosting covered entities’ reporting requirements.

Walden said he hoped his effort would attract bipartisan support. The top Democrat on his committee, Rep. Frank Pallone, D-N.J., said the committee’s report demonstrated 340B is critically important to hospitals and their ability to expand coverage to vulnerable populations.

ROSTERS SHUFFLED ON KEY HEALTHCARE COMMITTEES

Rep. Peter Roskam, R-Ill., who played a lead role in House Republicans’ drive to overhaul taxes last year, is the new chairman of the Ways and Means Subcommittee on Health.

Roskam claimed the subcommittee gavel after its previous chairman, Rep. Pat Tiberi, R-Ohio, resigned from Congress. Roskam’s subcommittee oversees Medicare Part A and Part B as well as CMS. Rep. Bill Pascrell, D-N.J., remains the top Democrat on the subcommittee.

Newly sworn-in Sens. Doug Jones, D-Ala., and Tina Smith, D-Minn., won seats on the Senate HELP Committee, which has jurisdiction over biomedical research and development and healthcare policy. Jones won the Alabama special election in December, and Smith replaced former Sen. Al Franken, D-Minn., who resigned earlier this month.

Sen. Sheldon Whitehouse, D-R.I., joined the Finance Committee, which has principal jurisdiction over HHS and CMS. Whitehouse is a strong supporter of the Affordable Care Act, and he also backs allowing the government to negotiate prices directly with drug manufacturers.

HOUSE PANEL TO VOTE ON BIPARTISAN DRUG, DEVICE BILLS

A House subcommittee on Wednesday will vote on three healthcare bills, including one that would establish user fees for over-the-counter drugs.

Other legislation that the House Energy and Commerce Subcommittee on Health is scheduled to vote on includes a bill that seeks to clarify how prescription drug and medical device manufacturers can share healthcare economic or scientific information.

The subcommittee also will vote on legislation that would shield healthcare professionals from liability if they serve as volunteers in response to a declared disaster or emergency.