Health Policy Report

The Week in Review

Before breaking for Memorial Day on Friday, lawmakers in both chambers tried to clear the decks on bipartisan measures with mixed success. In the House, a rewrite of the 1976 Toxic Substances Control Act (H.R. 2576) – which governs regulations for toxins used in the manufacture of consumer products – was passed on an overwhelming vote of 403-12 on Tuesday. The Senate aimed to pass the measure and send it to the president’s desk before the Memorial Day recess, but a last-second objection from Sen. Rand Paul (R-KY) pushed a final vote on the bill into June. The bill will likely be near the top of the Senate’s agenda when the chamber returns and remains on track for final passage with support from most senators of both parties. 

The House also tried to push through the fiscal 2017 Energy-Water Development spending bill (H.R. 5055), but the inclusion of controversial amendments related to LGBT protections and a pending deal to purchase heavy water from Iran ultimately sunk the bill’s chances. It failed on a 112-305 vote on Thursday, and will likely be reworked when the House returns. On a more positive note, the House approved a Senate-passed energy efficiency bill (S. 2012) on Wednesday that would streamline natural gas permitting and modernize the nation’s electrical grid. That bill now heads to a bicameral conference, with the House naming their conferees late last week. House lawmakers also succeeded in passing a bill (H.R. 897) intended to help fight the Zika virus by exempting certain pesticides from Clean Water Act permitting requirements. The bill had failed to pass under suspension of the rules earlier this month, but was approved by a simple majority on a 258-156 vote last week.

In the Senate, debate on the fiscal 2017 National Defense Authorization Act (NDAA) (S.2943) dominated the week, with Armed Services Committee Chairman John McCain (R-AZ) working to increase defense spending without breaking existing spending caps. McCain’s proposal would boost the Pentagon’s war-fighting fund – known as the Overseas Contingency Operations Account (OCO) – to $59 billion, with $18 billion being directed towards weapons programs that are traditionally included in the Department of Defense’s base budget request. The House has already approved its version (H.R. 4909) of the NDAA, and it will likely be the primary item for Senators to consider when they return next week.

Last week, Senate lawmakers also approved a resolution (H.J. Res. 88) disapproving of a recently finalized Labor Department rule that would subject retirement advisers to a fiduciary standard. Three Democrats joined all voting Republicans in approving the measure, but support remains well short of the necessary two-thirds needed to override an expected veto from President Obama.

The Week Ahead

Both chambers are in a week-long recess for the Memorial Day holiday. The Senate is scheduled to return on Monday, June 6, with the House slated to reconvene a day later on Tuesday, June 7.  

Optimism Grows Over Mental Health Bill Reaching Floor   

Last week, a number of Senators reported that they have been in talks with Majority Leader Mitch McConnell (R-KY) about bringing the Senate Mental Health Reform Act (S. 2680) to the floor by this summer. At a summit on mental health Thursday that was hosted by the bill’s authors Sens. Chris Murphy (D-CT) and Bill Cassidy (R-LA), guest speaker and Senate Health, Education, Labor, and Pensions (HELP) Committee Chairman Lamar Alexander (R-TN) stated that the mental health bill has “as good a chance as any other major legislation” of seeing action in the Senate before the party conventions in July. Prior to the summit, Sen. Alexander told lawmakers that the Majority Leader is willing to put the bill on the floor, but that a consensus would have to be secured ahead of time so that consideration would not take up too much floor time. 

While the bill has gained bipartisan support, differences are still being worked out over guns and finances. Sen. John Cornyn (R-TX) has introduced an amendment to include gun-related language from his own mental health bill that Democrats have opposed, arguing that it would make it easier for mentally ill people to get access to guns. However, Sens. Alexander, Murphy and Cassidy say they are working with Sen. Cornyn to try to reach an agreement, and that Sen. Cornyn himself has said repeatedly that he wants to work with others to get to a positive result. Furthermore, issues have arisen over funding, as the Murphy-Cassidy bill currently does not include any new funding for mental health programs. However, Sen. Murphy noted at last week’s summit that Senate Finance Committee Chairman Orrin Hatch (R-UT) has committed to finding offsets for funding provisions to be added in. So far, one option has been to find new funding to expand a program from legislation authored by Sens. Debbie Stabenow (D-MI) and Roy Blunt (R-MO) that would set up urgent care mental health clinics in more states. Another option would be to remove the “IMD exclusion” which would free up Medicaid to pay for more care at mental health facilities. However, this exclusion is estimated to be very costly. Sen. Murphy noted last week that “expanding out the Blunt-Stabenow proposal is not as expensive, so that gives you a little bit of a hint about what might be more possible on the floor.”

Meanwhile, advocates continue to push for a vote on the bill. At the conclusion of last week’s mental health summit, the Senators – along with members from the American Foundation for Suicide Prevention, Eating Disorders Coalition, Sandy Hook Promise, and the National Alliance on Mental Health – presented over 200,000 signatures for a petition to Majority Leader McConnell and Minority Leader Harry Reid (D-NV) urging them to “take action on mental health now!”

Regulatory Agenda Shows Part B Drug Demo Rule Pushed Back to 2019; But CMS Says It Remains On Track

The Medicare Part B drug payment demo could be pushed back three years, as the Obama Administration’s recently released regulatory agenda states that the Centers for Medicare and Medicaid Services (CMS) does not expect to finalize its demo until March 2019 – a date that occurs three years into a new administration. The two-phase demo proposed earlier this year would test new ways for Medicare Part B to pay for prescription drugs. Under Phase 1 of the nationwide demonstration, CMS has proposed replacing the current formula – the average sales price (ASP) of the drug plus a 6 percent add-on fee – with a rate of ASP plus 2.5 percent, plus a flat fee of $16.80 per drug per day. Under Phase 2, CMS has proposed testing a number of value-based purchasing (VBP) strategies, including reference pricing, discounting patient cost-sharing, feedback on prescribing patterns and online decision support tools, and risk-sharing agreements based on outcomes. Phase 1 was originally expected to begin in late 2016 while Phase 2 was scheduled to start no earlier than January 2017.

Meanwhile, a CMS official downplayed the regulatory agenda timetable last week in response to social media rumors that the demo had been officially pushed back, affirming that the agency has not announced a change in timing and would continue to review comments. The official instead revealed that “final action” on the White House Office of Management and Budget's (OMB) website in this case reflects the statutory deadline for a final rule, not the expected time to issue a final rule. However, the statutory deadline and the final action dates listed in the agenda for many rules are not the same. He further noted that Section 902 of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA) requires the Department of Health and Human Services (HHS) secretary – in consultation with the OMB director –  to establish and publish a regular timeline for publishing a Medicare final rule after the publication of a proposed or interim final rule. The official stated, “The regular timeline may vary based on the complexity of the rule, the number and scope of comments received, and other relevant factors, but it must not exceed three years except under exceptional circumstances.”

Biden to Host Cancer Research Summit

On Tuesday, the White House announced that Vice President Joe Biden will be hosting a “National Cancer Moonshot Summit,” aimed at motivating momentum on the Vice President’s initiative to double the pace of research to cure cancer. The daylong summit, set to be held June 29 at Howard University, would feature cancer stakeholders such as scientists, oncologists, donors, and patients and be the first of its kind to focus broadly on the more than 100 types of cancer.  According to Greg Simon, a former Pfizer executive who is running Vice President Biden's cancer initiative summit, the event aims to emphasize strategies for prevention and early detection, and encourage access to treatment and data sharing. "It's a tall order, to be sure," Simon stated. "But it's one I'm confident we can fill once we break down silos and foster more collaboration. The summit's goal is to do just that."

Poll Reveals Vast Majority of ACA Beneficiaries Satisfied With Coverage

According to a semi-annual tracking survey of the Affordable Care Act (ACA) conducted by the Commonwealth Fund, nearly three-quarters of adults who receive health insurance through the ACA marketplace or Medicaid say they are satisfied with their plans.  According to the poll, 39 percent of respondents said their coverage has improved as a result of the ACA, while another 45 percent said their coverage has remained the same. Meanwhile, only 7 percent of the survey participants reported that their coverage has gotten worse, which differs significantly from national polls which show that nearly half of all Americans oppose the healthcare law.

The positive response comes at the heels of critics warning that insurers will be more likely to shrink their networks because of the limits on cost-sharing and the focus on second-lowest-cost silver plans as the benchmark for setting subsidies. Furthermore, critics say that customers could have a tougher time finding doctors in their area without wait times. Medicaid patients – whose rolls increased dramatically under the law – have long faced trouble finding doctors because of the program’s historically low reimbursement rates. The survey shows that American sentiments over the healthcare law may not be as negative as some critics suggest.