Health Policy Report

The Week in Review

While the House adjourned at the end of July for the traditional August recess, the upper chamber was in session last week to handle legislative business that had been delayed due to Republican’s consideration of their Affordable Care Act (ACA) repeal bill. The Senate passed sweeping legislation to reauthorize user fees that fund the Food and Drug Administration’s (FDA) review of drugs and medical-devices, along with a pair of targeted health care bills addressing opioids and experimental drugs (more on these below).

Additionally, Senate Republicans pushed back against pressure from the White House to make yet another attempt at passing legislation to repeal and replace the ACA. Republican leadership has indicated — despite a threat from the President to cancel cost-sharing reduction (CSR) payments to insurers — that it wants to move on to other issues.  Meanwhile, Sens. Lindsey Graham (R-SC), Bill Cassidy (R-LA), and Dean Heller (R-NV) remain determined to keep efforts alive, including meeting with Vice President Pence and a collection of governors last week about their proposal to keep most of the policy changes of the Senate’s original plan while giving additional authority to state governments.

In other floor action, senators confirmed nearly 70 of President Trump’s nominees by unanimous consent — allowing lawmakers to skip over a marathon of votes. The deal was a result of days of negotiations between Senate Majority Leader Mitch McConnell (R-KY) and Minority Leader Charles Schumer (D-NY). Democrats have been drawing out confirmation of Trump's nominees for months, citing the GOP’s partisan effort to repeal the ACA, but pledged that they would be more cooperative once that legislation failed. Key health care confirmations included Dr. Jerome Adams as Surgeon General and Dr. Elinore F. McCance-Katz as the first Assistant Secretary for Mental Health and Substance Use;

The Week Ahead

After reaching an agreement to pass key health care legislation and approve dozens of President Trump’s nominations, the Senate has adjourned for August recess — trimming a week from their previously-extended summer work period. While senators have left town until after Labor Day, the upper chamber will meet in “pro-forma” sessions every few days during the recess. The nine pro-forma sessions on the Senate calendar will block President Trump from being able to make recess appointments over the break. The current deal comes after Trump publicly criticized Attorney General Jeff Sessions, sparking speculation that he would fire the former senator and try to name his successor while Congress was out of town. The House has been out of session since the last week of July, and both chambers are scheduled to return on Tuesday, September 5.

Senate Passes Legislation on FDA User Fees, Right-to-Try, Opioid Abuse

The Senate voted overwhelmingly (94-1) to pass the House-passed FDA Reauthorization Act (FDARA) (H.R. 2430) last Thursday after Sen. Ron Johnson (R-WI) agreed to pull back his threat to hold up the bill. Senator Bernie Sanders (I-VT) was the only member to vote against the bill. Majority Leader Mitch McConnell (R-KY) committed to taking up an amended version of Sen. Johnson’s right-to-try legislation to the floor in a separate vote, clearing the way for Senate consideration of the user fee package, which was spearheaded by Sens. Lamar Alexander (R-TN) and Patty Murray (D-WA). FDARA will renew and enhance the FDA drug, medical-device, biosimilar, and generic-drug user-fee provisions, and will account for $8 to $9 billion over five years in funding for the FDA. The legislation, which passed the House on July 12, is nearly identical to a similar package (S. 934) passed by the Senate HELP Committee in May. A White House spokesman on Thursday confirmed that President Trump would sign the bill, even though it would reflect policies largely negotiated by the Obama administration.

Sen. Johnson’s bill, known as the Trickett Wendler, Frank Mongiello and Jordan McLinn Right to Try Act (S. 204) was taken up by unanimous consent. Right-to-try legislation is broadly intended to provide terminally ill patients access to experimental drugs and treatments outside of clinical trials.  An amended version of Sen. Johnson’s bill would authorize the use of unapproved medicines by patients diagnosed with a life-threatening illness as long as the drugs in question have already gone through preliminary testing on humans and continue to be evaluated in research the FDA oversees. Eligible patients would have to exhaust other treatment options and be unable to participate in ongoing clinical trials.

Additionally, lawmakers unanimously passed a bipartisan opioids bill (S. 581) from Sen. Joe Manchin (D-WV) that would require the Department of Health and Human Services (HHS) to develop standards for hospitals and physicians to denote a patient’s history of opioid addiction in medical records. The so-called Jessie’s Law directs HHS to create “best practices” for doctors and hospitals to note painkiller sensitivity in patients’ charts, so doctors don’t unwittingly prescribe drugs to patients susceptible to overdose. The bill was named after Jessie Grubb, who overdosed and died after being prescribed oxycodone by a doctor unaware of her addiction history.

Senators Announce Bipartisan Hearings on Market Stabilization

The Senate Health, Education, Labor, & Pensions (HELP) and Finance Committees respectively announced last week that they would hold hearings on possible policy actions to immediately stabilize the ACA’s exchanges. The HELP Committee was the first to announce it would be spearheading efforts to craft a bipartisan bill aimed at market stabilization, and revealed last week that it would begin to hold hearings on the issue starting September 4^th. Sens. Lamar Alexander (R-TN) and Patty Murray (D-WA) have said they hope to have a draft bill ready by mid-September, and agreed that it would need to be “small, bipartisan, and balanced” in order to pass in an appropriate time frame. They identified funding to continue cost-sharing reduction (CSR) subsidies and “greater flexibility for states” in approving health insurance policies as priorities for the draft bill.

Likewise, Senate Finance Committee Chairman Orrin Hatch (R-UT) announced a day later that his panel would also hold a hearing on the issue in September to provide ample chance for both parties to discuss health reform.  He noted that the main concern for the Committee this fall will be tax reform, but that many members had demanded that they follow suit on efforts for bipartisan health reform. The Chairman also announced that the Finance Committee would hold a separate hearing in September on reauthorizing the Children’s Health Insurance Program (CHIP), which is set to expire on September 30^th. Although the program has historically received support from both sides of the aisle, advocates have argued it was ignored to pursue the larger ‘repeal and replace’ initiative and now risks expiration if Congress cannot reauthorize the program before the fast-approaching deadline.

Bipartisan 'Problem Solvers Caucus' Unveils Five Point Market Stabilization Plan

Early last week, the House Problem Solvers Caucus — led by Reps. Tom Reed (R-NY) and Josh Gottheimer (D-NJ) — unveiled a proposal aimed at the immediate stabilization of the individual market. Among the key policies highlighted in their proposal: (1) funding the cost-sharing reduction (CSR) payments to insurers, (2) creating a long-term reinsurance fund, (3) repealing the medical device tax, (4) scaling back the employer mandate, (5) giving states more flexibility under 1332 waivers, and (6) encouraging federal guidance allowing insurance to be sold across state lines. The bipartisan group consists of 43 House lawmakers who have met behind closed doors in recent weeks in search of agreement on ACA reforms. The proposal declares that the lawmakers stand ready to find agreeable offsets for each of the proposals, and that they plan to meet with constituents and stakeholders over the August recess.

Perhaps most significantly, the Problem Solvers recommend bringing CSR payments under Congressional oversight and ensuring mandatory funding through the appropriations process. President Trump threatened those payments this past week, and said he would cancel the payments in an attempt to make the ACA exchanges “implode.” The group also recommends the creation of a dedicated stability fund that states may use to reduce premiums and limit losses for providing coverage. Additionally, they recommend raising the threshold of requirement for the employer mandate from a business of 50 employees to a business of 500 employees or more. They suggest the definition of “full time” under the employer mandate should indicate that a full-time work week is 40 hours.

The group also urges the repeal of the 2.3 percent tax on medical device supplies, citing concerns that the costs of the tax are passed on to consumers. The group also advocated for “technical legislative changes and/or revised HHS guidance” to improve the “attractiveness” of Section 1332 innovation waivers allowing states to innovate in the exchange market. Similarly, the proposal urges HHS to issue guidance relative to Section 1333 of the Affordable Care Act (ACA), which allows states to enter Health Care Choice Compacts to sell insurance across state lines. In each case, they ask that HHS provide guidance with the aim of bringing more choice and competition to the market while protecting consumers.

Senate Confirms Dozens of Nominations, Including Top HHS Positions

As part of a sweeping batch of executive branch nominees confirmed last week, the Senate approved seven nominees to fill top positions at the Department of Health and Human Services (HHS). The following were confirmed by Senate vote Thursday afternoon:

• Peter Louis Oppenheim, of Maryland, to be Assistant Secretary for Legislation and Congressional Affairs;
• James J. Sullivan, Jr., of Pennsylvania, to be a Member of the Occupational Safety and Health Review Commission;
• Heather L. MacDougall, of Florida, to be a Member of the Occupational Safety and Health Review Commission;
• Elinore F. McCance-Katz, of Rhode Island, to be Assistant Secretary for Mental Health and Substance Use;
• Lance Allen Robertson, of Oklahoma, to be Assistant Secretary for Aging;
• Jerome M. Adams, of Indiana, to be Medical Director in the Regular Corps of the Public Health Service, and the be Surgeon General; and
• Robert P. Kadlec, of New York, to be Medical Director in the Regular Corps of the Public Health Service, and to be Assistant Secretary for Preparedness and Response.

Of special note, Dr. Elinore McCance-Katz is to become the first HHS assistant secretary for mental health and substance abuse. The position was created under the 21^st Century Cures Act last year as part of a mental health reform initiative, and will allow Dr. McCance-Katz the chance to work directly with HHS to bring attention to behavioral health issues, substance abuse disorders, and rising suicide rates.

Dr. McCance-Katz, Mr. Robertson, Dr. Adams, and Dr. Kadlec were all vetted by the Senate Health, Education, Labor, & Pensions (HELP) Committee last Tuesday after Democratic members requested the hearing in order to properly question the nominees. The nominees were further discussed by the committee behind closed doors Wednesday, before moving to a full Senate vote last week.