Washington Watch

Carter L. Alleman, J.D.

Senate confirmed Representative Tom Price, MD (R-Ga.) as Secretary of the U.S. Department of Health and Human Services (HHS) on February 10. The 52-47 vote fell along party lines. Price, an orthopedic surgeon, is the first doctor to head the agency since Louis Sullivan, HHS Secretary from 1989-1993, and only the third physician to hold the position in the agency’s 60-year history. While in Congress, Price was one of the top opponents of the Affordable Care Act (ACA). During his confirmation hearings, he agreed with Republican calls to stabilize the insurance market in the short-term, and to move forward with repeal and replacement at a moderate pace.

He reiterated that the administration’s ACA replacement plan would ensure patient access to affordable health insurance coverage. During his nomination process Price also went on the record about the need for more transparency around drug pricing, as well as the importance of giving states more flexibility to administer their Medicaid programs. He also expressed support for an eight-year extension of the Children’s Health Insurance Program (CHIP).

Legislation that would repeal the Independent Payment Advisory Board (IPAB) was introduced in both the House and the Senate last week. IPAB was created by the Affordable Care Act (ACA). It is responsible for making recommendations to reduce Medicare costs should spending exceed a certain target. The law allowed for a one-time process to discontinue IPAB if a joint resolution is introduced no later than February 1. Members met the statutory deadline required to discontinue the process by introducing 3 identical joint resolutions fulfilling this statutory requirement.

The GOP legislation to repeal and replace the Affordable Care Act (ACA) was leaked on Friday. The leaked document is dated February 10, and it is unknown how much Republican’s plans have changed since then. The bill would repeal the core elements of the law, including the individual mandate, taxes and tax subsidies, and Medicaid expansion, and would create a new health system based on an age-adjusted tax credit of between $2,000 and $4,000. The bill also includes $10 billion annually for state innovation grants, which could be used by states in the formation of high-risk pools or reinsurance programs. The law maintains protections for pre-existing conditions, but plans would be allowed to charge people up to 30 percent more on their premiums if they experience a gap in coverage. Insurers could also charge older Americans five times as much as younger Americans, an increase over the current 3:1 ratio.

Requirements that plans cover certain services would be relaxed, as would restrictions on health savings accounts (HSAs). The bill would institute a per-capita cap in the Medicaid program, and includes language that would eliminate funding for Planned Parenthood for one year. While penalties associated with the law’s mandate would be repealed immediately, tax subsidies and Medicaid expansion would remain in place until 2020. After 2020, states could continue covering their expanded Medicaid population, but would no longer receive additional federal funds. The GOP plan would be paid for by taxing the most generous employer-sponsored health insurance plans – those above the 90th percentile of premiums. A markup of repeal and replace legislation before the Energy and Commerce Committee is not likely to happen until at least the week of March 6. Lawmakers return today after a weeklong recess.

Governors met with President Donald Trump and congressional lawmakers to discuss, among other topics, the GOP’s efforts to repeal the 2010 health care law. The issue was a focus over the weekend as governors huddled in Washington for the National Governors Association’s winter meeting. They met with Health and Human Services Secretary Tom Price for a question-and-answer session about ongoing federal efforts to repeal and replace the health care law. The meeting comes after a leaked discussion draft on Friday outlined the House GOP’s plan to overhaul the Medicaid program, which included major changes to the funding states would receive.

One major issue facing congressional Republicans as they attempt to fulfill their seven-year pledge to repeal Obamacare is whether to continue enhanced federal funding for the 31 states plus the District of Columbia that expanded Medicaid under the law. Several GOP governors in both expansion and non-expansion states, including Govs. Asa Hutchinson of Arkansas, Pete Ricketts of Nebraska and Doug Burgum of North Dakota, said figuring out how to equitably treat both groups of states was a key aspect.

The House Republicans are moving forward with their plan to overhaul the program, which they argue will help guarantee its solvency over the long term. That plan involves paying states a set amount of funding for each enrollee, rather than offering uncapped funds based on annual health care spending for the Medicaid population.

President Donald Trump signed an executive order directing that each federal agency create a task force to identify and recommend changes to “unnecessary, burdensome and harmful” rules. The order is the latest in the administration’s push to unwind regulations across the executive branch. Trump also previously signed an executive order that would require agencies to eliminate two regulations for every new one they finalize. This order, according to the White House, directs each agency head to name its task force, which will make a report on its recommendations, within 90 days.

House Judiciary Committee members are trying to close a loophole in federal antitrust law that they say gives health insurers an unfair advantage at the expense of consumers. But the popular and potentially bipartisan nature of the effort might come up against the powerful insurance industry.

A bill being considered at the Subcommittee on Regulatory Reform, Commercial and Antitrust Law would end a narrow antitrust exemption in the McCarron-Ferguson Act of 1945, which allows insurers to share certain information that can help assess risk and price. The bill’s proponents frame it as a common-sense fix that will prevent health insurers from anti-competitive conduct. The exemption in the 1945 law is fairly narrow. It doesn’t, for instance, give insurers the ability to conduct mergers or set prices with impunity. But witnesses at the hearing who support its repeal say that it no longer serves any purpose except to potentially promote market-distorting behavior.

Health and Human Services Secretary Tom Price on Wednesday delayed by a month certain provisions of a Medicare payment test involving heart and orthopedic procedures, pushing their effective date to March 21 from Feb. 18.

The delay was taken in accordance with the White House's Jan. 20 memo, entitled "Regulatory Freeze Pending Review," per a final rule posted Wednesday. The proposals in question, put forward by the Obama administration, includes a test of how well people on Medicare after receiving care for heart attacks or bypass surgery. "We believe these models will further our goals of improving the efficiency and quality of care for Medicare beneficiaries receiving care for these common clinical conditions and procedures," the Centers for Medicare and Medicaid Services said in the rule. The measure was moved forward by Health and Human Services Secretary Tom Price and Patrick Conway, an Obama administration official who is serving as acting CMS administrator.

The rate of drug overdose deaths continued to increase in 2015, in keeping with a 16-year trend, according to the Centers for Disease Control and Prevention (CDC). There were 16.3 drug overdose deaths per 100,000 people. The greatest impact of overdoses was seen in the 45-54 age population, and was higher for men than for women. The percentage of deaths caused by opioids decreased from 29 percent in 2010 to 24 percent in 2015. Overdose deaths caused by synthetic opioids, such as fentanyl, are on the rise – increasing from eight percent in 2010 to 18 percent in 2015. Leadership from the Energy and Commerce Committee sent a letter to the Office of National Drug Control Policy (ONDCP) last week requesting more information on the federal response to the fentanyl epidemic. “Overdoses and deaths associated with fentanyl are spreading across the country. Nonetheless, it remains unclear if key law enforcement and public health agencies have developed a strategic plan aimed at the fentanyl threat, particularly one that disrupts the illicit supply of fentanyl coming into the U.S.,” they write. The lawmakers ask ONDCP to question all federal agencies in their jurisdiction about their plans to address this particular public health threat. The letter was signed by Chairman Greg Walden (R-Ore.), Ranking Member Frank Pallone (D-N.J.), Oversight and Investigations Subcommittee Chairman Tim Murphy (R-Pa.) and Subcommittee Ranking Member Diana DeGette (D-Colo.).