United States: Capitol Hill Healthcare Update - February 13, 2017

At HHS, Price will lead Trump's efforts on ACA repeal

Three weeks into President Trump's administration, the Senate on Friday narrowly approved Tom Price as Secretary of the U.S. Department of Health and Human Services (HHS), elevating the former orthopedic surgeon as Trump's point person on repealing and replacing the Affordable Care Act (ACA). Price won Senate confirmation 52-47 after Democrats exhausted all procedural tools to block a vote. No Democrat voted to confirm Price.

Price's installation is key to Republicans' drive to repeal the healthcare law. Because much of the ACA was implemented through department regulation, Price will determine which provisions can be dialed back or wiped out altogether by withdrawing existing HHS regulations, promulgating new ones or simply not enforcing what's already on the books.

The Secretary's first regulatory action may be to bolster the ACA, not undermine it. Congressional staff say HHS may push changes that would favor insurers – by allowing them to charge older customers higher premiums – in an effort to keep insurance companies from abandoning the ACA marketplaces before Congress can agree on an overall replacement plan. 

ACA taxes unsettled as GOP struggles on repeal plans

President Trump said Friday that he was putting together "the final strokes" of an ACA replacement plan, but congressional Republicans are working methodically on what would follow an ACA repeal, and House Speaker Paul Ryan said legislating on a replacement plan could take all year.

While key Republicans say they want to immediately repeal the ACA's taxes on wealthy individuals and providers, there are continuing indications that the issue isn't settled. Some GOP lawmakers, including the No. 2 Senate Republican, Sen. John Cornyn (R-Texas), say Congress will need access to that tax revenue both to fund the ACA during the transition and for whatever policy follows it. 

Republicans still plan to repeal most of the ACA using legislation known as budget reconciliation, which Democrats can't derail with a filibuster in the Senate. GOP leaders want the repeal bill to include elements of their replace plans, including expanded Health Savings Accounts and tax credits to aid people buying insurance. Congress would later debate a series of individual bills that collectively would finish out their plans on what would follow the ACA.

But underscoring the Republican division over how to proceed, a leading conservative, Sen. Mike Lee, (R-Utah), said last week that no ACA replacement provisions should be included in the bill to repeal the law. "If we load down the repeal discussion with what comes next, I think it's going to make it a lot harder to get either one of them done," Lee said during a forum at the conservative Heritage Foundation.

The timing for approving repeal of the ACA in reconciliation legislation appears to be slipping too. Several House committees were slated to draft components during the week of Feb. 27, but that has been delayed into March as leaders seek to educate and gain support from lawmakers on details. The GOP leadership will hold listening sessions this week with House rank-and-file members to discuss health savings accounts and potential Medicaid changes.

With committee action delayed, it is possible Congress won't pass a final reconciliation bill repealing most of the ACA until April, when insurers will begin to formulate 2018 rates for policies sold next year on the ACA exchanges.

Senate panel to hold hearing on CMS pick

The Senate Finance Committee on Thursday will hold a hearing on Seema Verma's nomination to be administrator of the Centers for Medicare and Medicaid Services (CMS). Verma, who founded a healthcare consulting firm, worked to expand Indiana's Medicaid program when Vice President Pence was that state's governor. She also consulted with several other Republican governors on their Medicaid programs. Committee Chairman Orrin Hatch (R-Utah) praised Verma's "extensive background and depth of experience in health policy," saying she's "immensely qualified" to lead CMS. Although Senate Democrats have been fighting most of President Trump's Cabinet picks, it's not clear whether that would extend to agencies like CMS. So far Verma hasn't triggered any public criticism from Democrats.

House FDA user fee hearings delayed

The House Energy and Commerce Committee has delayed for several weeks consideration of legislation reauthorizing $2 billion in industry user fees to the FDA. Drug and medical device manufacturers agreed with the FDA last year on a new five-year user fee agreement, and the FDA held a series of public hearings on the deal. Congress has until Sept. 30 to renew the user fees though lawmakers want to act before that.

The committee had planned hearings this week, beginning with the medical device industry agreement. But the committee pushed back the hearings until March and is expected to begin with the generic drug user fee agreement. The Senate is also expected to begin its user fee hearings next month.

Energy and Commerce Committee Chairman Greg Walden (R-Ore.) said he wants the user fee package voted on by the House sometime in May. Congressional leaders want to shield the reauthorization from related healthcare controversies, like prescription drug prices. It is likely that any changes or amendments to the underlying user fee legislation would need significant bipartisan support to be included in the reauthorization.

House Democrat to talk drug prices with Trump

Rep. Elijah Cummings (D-Md.) said he will meet with President Trump at the White House this week to discuss prescription drug costs. Cummings had been invited to a meeting with Trump and pharmaceutical CEOs last week but was conflicted from attending. The long-time Baltimore lawmaker has been an outspoken critic of the drug industry, which he has accused of raising drug prices only to increase company profits.

Trump repeatedly pledged during last year's campaign to require Medicare to negotiate drug prices with manufacturers, a change in law that would require congressional approval. In the meeting with CEOs, however, the president backed off, focusing instead on speeding approval of generic drugs. But White House spokesman Sean Spicer walked that back the next day, reaffirming Trump's position that Medicare should be allowed to negotiate directly with pharmaceutical companies over drug prices.

Grassley questions orphan drug exclusivity

Senate Judiciary Committee Chairman Chuck Grassley (R-Iowa) said his office is examining what role a law designed to incentivize development of treatments for rare diseases may be playing in the overall costs of prescription drugs. The Senator said he wanted to know whether pharmaceutical manufacturers were abusing the Orphan Drug Act by repurposing drugs approved for wider audiences to narrower populations with rare diseases. Under the 1983 law, drugs approved to treat fewer than 200,000 patients include tax credits and seven years of marketing exclusivity. 

Grassley said his staff would meet with stakeholders to understand whether "orphan drug provisions appear to be stretched beyond their original intent." The Senator didn't announce whether he would push for Senate hearings or put a timetable on his review.

Separately, Rep. Peter Welch (D-Vt.) introduced legislation last week that would limit the 340B drug discount program's orphan drug exclusion by applying it only when drugs are used to treat the rare diseases or conditions they were first approved to treat.

Pence backs legislation on "right to try"

Vice President Pence last week endorsed legislation that would give terminally ill patients wider access to prescription drugs that haven't yet won FDA approval.

Sen. Ron Johnson (R-Wis.) introduced bipartisan legislation last month that would permit patients access to unapproved drugs if their doctors certify no other treatment options exist. Identical legislation was introduced in the House last week by Reps. Andy Biggs (R-Ariz.) and Brian Fitzpatrick (R-Pa.). The bills would go beyond current FDA policy of approving single-patient access to experimental treatments with physician and drug company approval.

Pence also supported so-called right-to-try legislation as Indiana governor. The Vice President met with patient advocates last week and announced his support of the federal legislation. Pharmaceutical manufacturers have resisted similar legislation in Congress and the states, saying early access to unapproved drugs could give patients false hope and also threaten the integrity of ongoing clinical trials if those patients have adverse reactions. 

GOP leaders to choose Price successor on key panel

House Republican leaders are scheduled to meet Tuesday to choose a GOP lawmaker to take the coveted seat of former Rep. Tom Price (R-GA) on the Ways and Means Committee. An opening on the powerful panel became available when Price resigned from the House last week after he was sworn in as HHS secretary. While several House Republicans are vying for the slot, GOP leaders are expected to choose Rep. Mike Bishop (R-Mich.). In addition to jurisdiction over tax policy, the committee has authority over CMS and Medicare Part A and Part B.

"Cures" authors seek guidance on FDA hiring freeze

The two principal authors of last year's "21st Century Cures" medical innovation law are asking the White House for clarification on whether President Trump's federal hiring freeze affects the FDA. Even before President Trump issued the executive order on January 23 freezing all new government hires, the FDA had nearly 1,000 positions unfilled. The government-wide freeze is only exacerbating workload concerns at the FDA, according to Reps. Fred Upton (R-Mich.) and Diane DeGette (D-Colo.).

The lawmakers, in a letter to the Office of Management and Budget (OMB), said the freeze could impact FDA commitments made under current industry user fee agreements as well as new funds Congress appropriated last year to hire additional FDA staff under the Cures law. The lawmakers called on OMB to issue guidance clarifying whether the FDA is subject to the hiring freeze. Several senators also have called on the White House to spell out whether the FDA might be exempt from the executive order.

Bipartisan bill would expand "Sunshine" reporting

Sens. Chuck Grassley (R-Iowa) and Richard Blumenthal (D-Conn.) last week reintroduced legislation extending current reporting requirements under the Sunshine Act to include payments made to physician assistants, nurse practitioners and other advanced practice nurses. Both senators have pushed the legislation since 2015, but it has not received a vote to date. Grassley was the principal author of the Sunshine Act, which was enacted as part of the ACA in 2010.

With Republicans focused on repeal of the ACA, Grassley will fight any attempt to remove or weaken its existing sunshine provisions. But it's uncertain whether the Republican-controlled Congress has the appetite to expand reporting requirements as Grassley wants. Most providers oppose expanding the law, saying it won't improve data collection but would burden providers with additional paperwork requirements. Already a significant percentage of payments or transfers currently reported under the law include low-cost meals and refreshments provided with training programs.

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