Health Law Update

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<img class="alignright size-medium wp-image-4777" src="https://healthlawupdate.bakerhostetlerblogs.com/wp-content/uploads/sites/19/2017/03/hlu-photo-300x200.jpg" alt="" width="300" height="200">ACA Stabilization Effort Continues Amid Uncertain Senate Fate

The chairman of a Senate healthcare committee outlined a key test for stabilizing the Affordable Care Act’s (ACA) shaky individual marketplace: Both Republicans and Democrats will have to give a little.

That formula has been wildly unsuccessful not only this year but also in recent years as the two parties have been at loggerheads over the GOP’s efforts to repeal the ACA. But in the wake of Senate Republicans’ failed efforts this summer to replace the healthcare law, HELP Committee Chairman Lamar Alexander (R-Tenn.) said last week there is a bipartisan path forward.

He said Republicans would need to guarantee future cost-sharing payments to insurers in an effort to stabilize the law’s individual insurance marketplace. In return, Democrats would need to permit new regulatory flexibility for states to design their own coverage within the confines of the ACA.

Alexander’s committee held two days of hearings last week with testimony from state insurance commissioners, and three Republican and two Democratic governors.

Alexander said he wants Congress to vote on a plan this month, ahead of a deadline by insurers to finalize contracts for next year. He said lawmakers’ quick action last week passing a short-term government funding bill and legislation raising the debt ceiling opened the door for a healthcare bill to win congressional passage before September 30.

Senate Majority Leader Mitch McConnell (R-Ky.) said he doubts Democrats could support relaxing standards enough to win over Republican backing for continuing the insurance subsidy payments. Even if senators accepted a compromise, it is uncertain whether it could win approval in the House or whether President Trump would sign it into law.

GOP Senators Expected to Introduce ACA Replacement Bill 

Two Republican senators say they will introduce legislation today that would repeal the ACA’s individual and employer mandate penalties and transform the law’s Medicaid expansion into a trillion-dollar block grant for states to design their own coverage models.

President Trump wants Congress to take another stab an overhauling the healthcare law and senior White House officials are pinning their hopes on new legislation by Sens. Lindsey Graham (R-S.C.) and Bill Cassidy (R-La.). The bill would also strip some of the ACA’s provider taxes, such as the excise tax on medical device manufacturers, but leave other taxes in place.

Cassidy said his bill would use fast-track budget reconciliation legislation, which allows Republicans to sidestep a filibuster and pass the bill with only 50 votes, instead of the usual 60 votes. But that fast-track procedure expires September 30, the end of the 2017 fiscal year.

The Congressional Budget Office will likely need at least two weeks to produce an economic analysis of the Graham-Cassidy bill – a critical first step before the Senate could even schedule a vote. That leaves little time this month before the expiration of the reconciliation legislation.

House Panel Questions Hospitals on 340B Use

Leaders on the House Energy and Commerce Committee last week sent letters to nearly two dozen hospitals and health systems nationwide seeking information on their participation in the 340B drug pricing program.

The committee has been examining the program for most of the year. During a hearing earlier this summer, officials with the federal agency that administers the program – the Health Services and Resources Administration – could not say to what degree hospitals were passing on program savings to patients.

Full committee Chairman Greg Walden (R-Ore.) and Oversight and Investigations Subcommittee Chairman Tim Murphy (R-Pa.) fired off the letters Friday seeking information on hospitals’ 340B purchased drugs. Specifically, the committee wants data on how organizations use any 340B program savings to aid vulnerable populations, including charity care to uninsured and underinsured patients.

Entities nationwide that received inquiries from the committee included Cedars-Sinai Medical Center, Duke University Health System, Grady Memorial Hospital, Johns Hopkins Hospital, Massachusetts General Hospital, and Parkland Health and Hospital System.

Hatch Open to Long-Term CHIP Reauthorization

Senate Finance Committee Chairman Orrin Hatch (R-Utah) agreed with witnesses at a hearing last week who called for a five-year renewal of the Children’s Health Insurance Program (CHIP).

Hatch, who helped write the law in 1997, told reporters after the hearing that he could support a longer-term extension. But a longer renewal would also increase the likelihood Hatch’s committee considers CHIP program changes. A shorter-term extension would likely only continue existing policies while extending program funding.

The federal-state program expires September 30, but a federal commission said states are not expected to exhaust CHIP funds before the end of the year. So it’s unclear when Congress will act on CHIP legislation, but lawmakers don’t appear to be in a hurry to meet the deadline this month – neither Hatch nor House leaders has introduced CHIP legislation.

The CHIP program itself is largely non-controversial, and congressional leaders want to keep its reauthorization free from extraneous items, such as stabilizing the ACA’s individual insurance markets. As with pairing hurricane relief funding with legislation raising the debt ceiling, Congress may seek to add contentious items that could not pass on their own to a CHIP renewal bill.

Pharmacists Battle Each Other Over House Amendment

The House last week defeated an effort backed by a group of pharmacy compounders that opponents say would have risked triggering another outbreak like the one in 2012 caused by contaminated steroid injections that killed 64 people and injured hundreds of others nationwide.

Rep. Buddy Carter (R-Ga.) offered an amendment to the FDA’s annual appropriations bill that would have blocked the agency from finalizing a congressionally mandated draft 2015 memorandum of understanding on the interstate sale of compounded drugs.

The issue pitted 503A compounding pharmacies against 503B outsourcing facilities, with each group known for a section of the Drug Quality and Security Act that Congress passed in response to the 2012 meningitis outbreak at the New England Compounding Center. Under that law, 503A pharmacies can compound to individual prescriptions while 503B outsourcing facilities can produce large batches of drugs with or without prescriptions that are sold to healthcare facilities for office use only.

Carter – himself a pharmacist who owns a Georgia pharmacy – backed the 503A compounders’ effort to expand their capabilities; the FDA’s draft memo would have limited the 503A compounders’ role. Carter’s amendment was defeated 141-279.

The National Community Pharmacists Association and the International Academy of Compounding Pharmacists advocated for Carter’s amendment, while the Outsourcing Facilities Association and Pew Charitable Trusts opposed what they said was an effort to undermine the Drug Quality Security Act.

Senate Panel Backs Health Funding Bill 

The Senate Appropriations Committee last week overwhelmingly approved a fiscal 2018 funding bill that includes $79.4 billion for health agencies and programs administered by the U.S. Department of Health and Human Services (HHS).

The funding would be $1.7 billion higher than current fiscal 2017 funding and $2.2 billion higher than the House’s version of the HHS spending bill. The Senate bill won committee approval 30-1.

Of the $36 billion approved for the National Institutes of Health (NIH), the committee allocated $290 million for precision medicine studies, $1.9 billion for Alzheimer’s research and $400 million for the BRAIN initiative.

The committee never seriously considered President Trump’s call to reduce NIH spending by 22 percent, which the White House proposed earlier this year in a budget request to Congress. Instead, the senators increased NIH funding by $2 billion.

Congress last week approved a stopgap funding bill to keep the government open, extending 2017 spending levels for 70 days into fiscal 2018, which starts October 1. That makes December 8 the new deadline for lawmakers to approve funding to keep the government open, including HHS.

Sanders to Introduce Single-payer Health Bill

While Republicans remain flummoxed by healthcare policy and politics, Democrats are split on whether to support the ACA or back a more aggressive government role in healthcare.

Sen. Bernie Sanders (I-Vt.) this week is scheduled to introduce a single-payer healthcare bill dubbed “Medicare for all.”

Sanders made single-payer a cornerstone of his 2016 presidential campaign, and he is trying to position the issue as a touchstone for Democrats considering running for president in 2020. Sens. Elizabeth Warren (D-Mass.) and Kamala Harris (D-Calif.) recently announced they would back Sanders’ bill.

Companion legislation introduced in the House by Rep. John Conyers (D-Mich.) has 117 co-sponsors – about 60 percent of all House Democrats.

Separately, Sen. Chris Murphy (D-Conn.) – another potential 2020 Democratic presidential contender – is preparing legislation that would allow individuals and businesses to buy into Medicare from the ACA’s Exchanges.

Capitol Hill Healthcare Update