TRP Health Policy Report
November 21, 2016The Week in Review
Congress returned to Washington last week for the first time since Donald Trump was elected to be the 45th President of the United States earlier this month, which has drastically altered the political landscape and expectations for the lame duck session. Lawmakers had been planning on completing fiscal 2017 spending negotiations during the lame duck, but President-elect Trump’s shock win has convinced Republicans to delay those discussions until next March so that the incoming Administration will be able to play a role. The current continuing resolution (CR) funding the government expires Dec. 9 and House Republicans have suggested that another stopgap measure will be used to maintain spending levels through Mar. 31 of next year.
Democrats – along with a few Senate Republicans – have been critical of the decision to complete another CR rather than an omnibus measure that would provide funding for the rest of the fiscal year. The new stopgap will require a supplement for ongoing defense contracts and could be complicated by renewed efforts to pass the 21st Century Cures medical innovation package or a water resources bill during the lame duck session. Last week, House lawmakers made progress on reaching a consensus for their version of the 21st Century Cures Act, which will reportedly be paired with a package to help overhaul the mental health care system. While those negotiations have solved issues related to new research funding and offsets (for full details on that progress, see our entry in the roundup below), several hurdles remain – most importantly reconciling the House version with the Senate’s own medical innovation initiative. Nonetheless, Congress is expected to go forward with the short-term spending measure, which may see lawmakers close out the lame-duck session earlier than the original Dec. 16 adjournment date.
Floor action was relatively quiet last week as lawmakers moved a few low-profile items in the short working session before the Thanksgiving break. Among those items were two Iran measures passed in the House; one (H.R. 6297) that would extend a law authorizing economic sanctions against the Middle Eastern nation, and another (H.R. 5711) that would prohibit the Treasury Department from approving the sale of commercial aircraft to Iran. The Obama White House has issued a veto threat on the latter measure, fearing that it would undermine the nuclear deal struck with Iran last year, but it is unclear whether the Trump Administration will protect one of President Obama’s signature foreign policy achievements. A final bill passed by the lower chamber would give Congress the power to block regulations made in the final year of President Obama’s term, targeting so-called “midnight rules,” with a resolution of disapproval. Predictably, that measure too has come under a veto threat. The Senate’s legislative work was even more limited, with only a non-controversial bill (H.R. 4511) approved that would expand the Veterans History Project at the Library of Congress to include recordings from the families of service members who were missing in action or killed in combat. Another bill (S. 3110) considered by the chamber last week that would reform offshore energy policy to expand the oil revenue that is shared with states fell nine votes short of the 60 necessary to pass cloture.
President-elect Trump has kept a low profile since the election, but he did take steps last week to begin filling out the incoming Cabinet. Among the reported confirmed appointments and nominations are: Republican National Committee (RNC) Chair Reince Priebus as White House Chief of Staff; Breitbart News Executive Chairman and Trump Campaign Advisor Steve Bannon as White House Chief Strategist; Sen. Jeff Sessions (R-AL) as Attorney General; Lt. Gen. Mike Flynn as National Security Advisor; and Rep. Mike Pompeo (R-KS) as Director of the Central Intelligence Agency (CIA). Democrats have criticized some of the picks, particularly Bannon and Sessions, over past controversies regarding race relations, but the minority party will need to garner the support of at least 3 Republican senators to block the positions that require Senate confirmation.
The Week Ahead
Congress will be out of session for the Thanksgiving holiday. Both chambers will return to Washington on Nov. 29 for a three-week blitz to close out the 114th Congress.
Look for President-elect Trump to continue making his picks to Cabinet positions next week. Among the more substantial rumors are Rep. Tom Price (R-GA) to lead the Department of Health and Human Services, former Republican presidential candidate – and ardent Trump critic – Mitt Romney to lead the State Department, and retired Gen. James Mattis to head the Department of Defense.
House Leaders Near Deal on 'Cures,' Mental Health Package
House lawmakers are nearing consensus on a version of the 21st Century Cures Act (H.R. 6), which will likely be coupled with a package that would help overhaul the mental health care system. While the final legislation has yet to be released, Rep. Fred Upton (R-MI) – the term-limited Chairman of the Energy and Commerce Committee and architect of ‘Cures’ – told House Republicans at a meeting last week that negotiations on the package are nearing completion. It has been suggested that the bill could be brought up for a suspension vote the week following the Thanksgiving break.
It’s still unclear how House lawmakers plan to reconcile their version of the bill – which passed on an overwhelming 344-77 vote – with an analogous (and in some instances, competing) effort from the Senate HELP Committee. Key questions also remain around the mental health language, which Chairman Upton suggested could be included either as an amendment or as part of the underlying measure. The final package is likely to include a mix of Rep. Tim Murphy’s (R-PA) House-passed bill and a similar measure in the Senate from Sens. Chris Murphy (D-CT) and Bill Cassidy (R-LA). Sen. Murphy indicated this week that final details on where and when to send funding are still being finalized. Additional funding to address opioid addictions is also part of discussions, he said.
Throughout the last several months, key sticking points on the legislation have been Democrats’ demand for new research funding. While no funding numbers have been officially finalized, Rep. Gene Green (D-TX), ranking member on the Energy and Commerce Health Subcommittee, has said that lawmakers were considering a $4 billion boost for the National Institutes of Health (NIH) and $1 billion for the Cancer Moonshot Initiative – a decrease from the $8.75 billion in new research funding in the initial House-passed 21st Century Cures Act. With respect to offsets, lawmakers have abandoned discussions to include a version of the CREATES Act – legislation that would require change in the way generic drug manufacturers obtain the samples necessary from brand-name pharmaceutical companies to create their cheaper versions of approved medications. Instead, lawmakers are expected to draw from the Affordable Care Act’s (ACA) Prevention and Public Health Fund along with funds generated by the Strategic Petroleum Reserves to offset the bill’s costs.
Even as an agreement takes shape, a number of hurdles still exist to get the legislation through both chambers of Congress, as the package could potentially face resistance from both Republicans and Democrats.
Trump, House GOP Leaders Call for Short-Term Spending Bill
House Appropriations Committee Chairman Harold Rogers (R-KY) announced Thursday that his staff would immediately begin working on a stopgap spending bill as per President-elect Donald Trump’s request. The bill would keep the government open through March 31st and would allow Republicans to avoid a final budget deal with President Obama. After consulting with Trump and Vice President-elect Mike Pence, Chairman Rogers stated that lawmakers will work to advance a continuing resolution (CR) to extend government operations at the current rate of funding. Rep. Ken Calvert (R-CA) added in an interview that the House would take the measure up the week after Thanksgiving, as current spending is set to expire after December 9th. Trump’s plan would shelve the previous idea of attempting to pass an omnibus spending package before mid-December.
Lawmakers decided during a closed-door meeting to back the path toward a short-term spending bill rather than support a broad, year-end package. Multiple House Republicans have reported that Speaker Paul Ryan (R-WI) suggested the short-term approach to spending, and presented it as the personal preference of the President-elect. Chairman Rogers explained that the stopgap bill was a “deference to the Trump administration,” and his Committee largely opposed the idea. House Appropriations Committee members had fought to complete a current-year package and preserve the work already done on getting bipartisan agreements for spending preferences and policy riders. Chairman Rogers stated that there would be many “anomalies” to address in the continuing resolution, and Rep. Tom Cole (R-OK) said he does not think “it will be a clean CR.”
Budget Committee Chairman, Tom Price (R-GA), and others declared that pushing this year's appropriations process into next March will make it tougher to write next year’s spending bills and for the Republican majority to pursue reconciliation, as it will shorten the timeline for the appropriations process. Members had also argued that leaving funding decisions unresolved would needlessly add a large must-do item to Trump’s first 100 days, which already includes an agenda crammed with plans to overhaul the tax code and repeal President Obama’s healthcare law.
GOP Prepares to Repeal ACA and Delay Replacement
Republicans are finalizing their plans to quickly repeal provisions of the Affordable Care Act (ACA) in the budget reconciliation process while paving the way for a replacement plan and relying on the Trump administration to make changes that ease the regulatory burdens. The Senate Republican Policy Committee released a memo Thursday (Nov. 16) that indicated the GOP intends to start the process by passing a budget resolution that includes reconciliation instructions. Republicans will then turn to reconciliation legislation crafted last year as a baseline for the new language. That bill is critical, not only because it successfully passed both chambers, but also because it has already been vetted by the Senate parliamentarian and thus follows all necessary budget rules.
If Republicans pass the repeal through reconciliation, they could delay the effective date for a year or two until a replacement could theoretically be enacted and shield the GOP from an immediate backlash from millions of people losing their current insurance. Trying to push through a replacement bill at the same time as they fast-track reconciliation would be difficult, as Republicans have not coalesced around any details of a plan. Democrats have warned that their colleagues on the other side of the aisle should refrain from scrapping the law without simultaneously introducing a solid backup plan. Many have expressed concern that if insurers know the law will be repealed, they may drop out of exchanges immediately, causing chaos for enrollees before any replacement plan has time to take shape. Although coverage for 2017 is already locked in, an exodus of insurers for 2018 would throw coverage into doubt for roughly 10 million people enrolled in ACA plans. Insurers would need to decide by next spring whether to participate in the ACA marketplaces in 2018. If there is no certainty about what the system will look like the next year, insurers are likely to avoid the risk of heavy losses and drop out.
Rep. Tom Price Floated as Possible HHS Secretary Pick
Representative Tom Price (R-GA), a practicing surgeon, is being considered by President-elect Donald Trump for Health and Human Services (HHS) Secretary. Rep. Price, an early Trump supporter, sits on the House Ways and Means Committee, which has jurisdiction over much of healthcare policy.
Rep. Price has been an outspoken critic of the Affordable Care Act, which Trump promised to repeal on the campaign trail, and sponsored healthcare legislation that would repeal the ACA and provide refundable tax credits adjusted by age, not income, to buy health insurance. Like other conservatives, Rep. Price also has supported broader use of health savings accounts and capping the tax break for employer-based coverage. On health payment reform, Rep. Price voted for the Medicare Access and CHIP Reauthorization Act of 2015, also known as MACRA. However, in October, Rep. Price aired some concerns over provisions he believed could increase administrative tasks and “ultimately threaten the doctor-patient relationship.”
Other speculated picks for Trump's HHS secretary include former Louisiana Gov. Bobby Jindal. Dr. Ben Carson, who ran for the GOP presidential nomination, announced Tuesday he will not serve in the Trump administration.
Republican Lawmakers Working on Medicare Overhaul for 2017
Representative Kevin Brady (R-TX), Chairman of the House Ways and Means Committee, announced Thursday that his office is working on drafting legislation to address Medicare changes in the 115th Congress. House Budget Committee Chairman Rep. Tom Price (R-GA) laid out the GOP’s goal of restructuring Medicare in 2017, and hopes to use reconciliation to advance major changes within the first six to eight months of the new administration. Rep. Price’s office reported Thursday that the timing and structure of any overhaul will depend on the incoming Congress and administration.
In his remarks, Rep. Brady referenced a House document finalized earlier this year at the request of Speaker Paul Ryan (R-WI) that lays out the Republican alternative to the Affordable Care Act and changes to Medicare and Medicaid, including premium support for seniors under Medicare or a private plan. Critics say that over time, the funding would be lower than under the current entitlement system and seniors could receive fewer benefits. Though President-elect Donald Trump said on the campaign trail that he did not plan to cut Medicare or Medicaid, a transition website that lists his presidential priorities for health care includes plans to "modernize Medicare, so that it will be ready for the challenges with the coming retirement of the Baby Boom generation – and beyond."