United States: Capitol Hill Healthcare Update - March 4, 2019

Below is this week's "Capitol Hill Healthcare Update," which is posted on Mondays when Congress is in session. Highlights this week: PBMs next in Senate committee's crosshairs; lawmakers continue scrutiny on insulin prices; bill introduction suspending medical device tax delayed; Grassley renews nursing home abuse inquiry; more committees hold more drug pricing hearings; and more.

PBMs NEXT UP AFTER PHARMA CEOs TESTIFIED BEFORE SENATE PANEL

Last week's Senate hearing on drug prices with pharmaceutical CEOs produced finger-pointing but few real fireworks as the executives offered a spirited defense of the industry but also substantive policy concessions to address drug prices.

Senate Finance Committee Chairman Chuck Grassley, R-Iowa, indicated pharmacy benefit managers, and then insurers, would be next up for hearings examining prescription drug prices. Separately, Senate HELP Committee Chairman Lamar Alexander, R-Tenn., said his panel will examine the commercial drug rebate market.

The seven pharmaceutical executives who testified last week avoided gaffes and left the industry in no worse a political position than before the hearing. Democrats were unsatisfied, pledging to continue to press for changes – including allowing the government to negotiate prices directly with manufacturers. Several Republicans appeared open to considering changes to patents, Medicare Part D and other policies.

While the drug executives largely escaped the hearing without adding to the industry's challenges on the Hill, pharma remains in bipartisan lawmakers' legislative crosshairs. The industry hasn't faced this level of legislative risk since 2009, when Democrats controlled Congress and the White House and began to push what became known as the Affordable Care Act.

SENATORS KEEP UP PRESSURE ON INSULIN PRICES

Stepping up congressional scrutiny of insulin prices, four senators are calling on the FDA to overhaul its regulations and streamline approvals of generic insulin products.

Last week, Sens. Dick Durbin, D-Ill., Kevin Cramer, R-N.D., Bill Cassidy, R-La., and Tina Smith, D-Minn., called on the FDA to change a recent agency guidance that the lawmakers said would delay approval of insulin products.

"Pharma's war on American patients with diabetes must come to an end," Durbin said last week in a speech on the Senate floor.

The Senate Finance Committee last month joined two House committees looking into the high cost of insulin. Rep. Diana DeGette, D-Colo., leads the Energy and Commerce Committee's investigative subcommittee, and she's questioning manufacturers over insulin prices. DeGette also is co-leader of the Congressional Diabetes Caucus.

Separately, Rep. Peter Welch, D-Vt., introduced legislation last month that would allow patients, pharmacists and wholesalers to import insulin from Canada and other countries.

GRASSLEY RENEWS PROBE OF NONPROFIT HOSPITALS

Senate Finance Committee Chairman Chuck Grassley, R-Iowa, last week pressed the Internal Revenue Service for data on whether nonprofit hospitals are in compliance with the requirements for their tax-exempt status.

The move by Grassley renews a years' long effort by the senator to ensure hospitals are using their tax savings to fulfill the legal standards of serving communities with low-income patients.

Grassley last year called on the IRS to provide information on nonprofit hospitals' enforcement practices and compliance data.

HOUSE PANEL HOLDS FIRST DRUG PRICING HEARING

The House Ways and Means Health Subcommittee on Thursday will hold its first hearing this year on prescription drug prices.

The subcommittee chairman, Rep. Lloyd Doggett, D-Texas, last month reintroduced legislation that would allow Medicare to negotiate prices directly with manufacturers – and if the companies refuse to negotiate, HHS could invalidate patents and grant competitive licenses to other manufacturers.

Witnesses include Robin Feldman, director of the Institute for Innovation Law at the University of California's Hastings College of the Law; Ameet Sarpatwari, an instructor in Medicine at Harvard Medical School; Amy Kapczynski, co-director of the Global Health Justice Partnership at Yale Law School; Frederick Isasi, executive director Families USA; and Douglas Holtz-Eakin, a former director of the Congressional Budget Office and now president of the American Action Forum.

The subcommittee has jurisdiction over CMS and Medicare Part A and Part B.

BILL TO REPEAL MEDICAL DEVICE TAX DELAYED WHILE CO-SPONSORS COLLECTED

House lawmakers last week delayed introduction of legislation to repeal the medical device tax while they gathered additional bipartisan co-sponsors.

Reps. Ron Kind, D-Wis., and Jackie Walorski, R-Ind., said they would introduce the bill once it had 218 co-sponsors, a majority in the House. The bill has attracted wide bipartisan support in recent years.

The legislation would repeal the 2.3 percent excise tax on the sale of medical technology. The tax is currently in the last year of a two-year suspension; without congressional action, it will go back into effect Jan. 1.

Senate legislation to repeal the tax is expected to be introduced by Sens. Pat Toomey, R-Penn., and Amy Klobuchar, D-Minn.

LAWMAKERS TARGET ACA'S HEALTH INSURERS' TAX

A bipartisan group of House lawmakers introduced legislation last week to delay the Affordable Care Act's (ACA) tax on health insurers.

The bill was introduced by Reps. Ami Bera, D-Calif., Josh Gottheimer, D-N.J., Jackie Walorski, R-Ind., and Kenny Marchant, R-Texas. It would delay the tax from taking effect until 2022.

The lawmakers cited analysis by America's Health Insurance Plans that said the tax would cost insurers $16 billion in 2020 and cause premiums to increase by more than $470 per family.

Last week, Sens. Cory Gardner, R-Colo., and Jeanne Shaheen, D-N.H., announced they were seeking co-sponsors for legislation to delay the insurers' tax.

Also weighing in last week were seven senators, who in a letter to Senate leaders called for action on legislation to delay the health insurance tax. The letter was led by Sens. Krysten Sinema, D-Ariz., Kevin Cramer, D-N.D., Marsha Blackburn, R-Tenn., Mike Braun, R-Ind., Martha McSally, R-Ariz., Mitt Romney, R-Utah, and Jacky Rosen, D-Nev.

Meanwhile, a group of 600 businesses, unions and insurers wrote to congressional leaders last week calling on Congress to repeal another ACA-imposed tax on high-cost insurance plans or "Cadillac plans," which the groups said have caused workers' deductibles to increase.

SENATE BILL REFERS 'PREDATORY PRICE GOUGERS' TO JUSTICE DEPARTMENT

New legislation introduced in the Senate – and supported by three current Democratic presidential candidates – would permit HHS to refer prescription drug manufacturers that engage in "predatory price gouging" to the Justice Department.

Introduced by Sen. Richard Blumenthal, D-Conn., the bill won support by presidential contenders Sens. Bernie Sanders, I-Vt., Amy Klobuchar, D-Minn., and Kamala Harris, D-Calif.

The legislation would require manufacturers to submit "justification" to HHS if they raised drug prices 10 percent in one year, 20 percent over three years or 30 percent over five years.

If HHS deemed a price increase unreasonable, it could require the company to reimburse consumers and payors, including Medicare and Medicaid, force the manufacturer to lower the price for up to one year and pay a penalty of up to three times the "excessive amount" the manufacturer received.

PANEL OPENS INVESTIGATION INTO NURSING HOME ABUSE

The Senate Finance Committee on Wednesday will hold the first of what is expected to be a series of hearings examining abuse and neglect in nursing homes.

Senate Finance Committee Chairman Chuck Grassley, R-Iowa, has long sought answers from federal regulators in charge of nursing home oversight. Last year, as chairman of the Judiciary Committee, he pressed CMS Administrator Seema Verma about oversight of an Iowa nursing home after a reported patient death.

Grassley also called on social media companies to examine how they could stop users from posting humiliating and demeaning photos of vulnerable individuals after reports surfaced of nursing home workers in at least 18 facilities taking unauthorized photos of elderly residents. He also introduced legislation to enhance enforcement against perpetrators of crimes targeting senior citizens, including elder abuse.

Witnesses at the hearing include Patricia Blank, daughter of a victim of nursing home neglect from Shell Rock, Iowa; Maya Fischer, daughter of a victim of nursing home neglect from Plymouth, Minn.; Dr. David Grabowski of Harvard Medical School; Dr. David Gifford of the American Health Care Association; Dr. Kate Goodrich, director of CMS' Center for Clinical Standards and Quality; Antoinette Bacon, associate deputy attorney general and national elder justice coordinator at the Justice Department; and Keesha Mitchell of the healthcare fraud section of the Ohio attorney general's office.

SENATE PANEL HOLDS TWO-DAY HEARING ON DRUG PRICES

The Senate Aging Committee this week holds two days of hearings examining prescription drug prices.

Committee Chairwoman Susan Collins, R-Maine, and the panel's top Democrat, Sen. Bob Casey, D-Penn., said the first day will focus on five patients who will discuss how prices for their prescription medicine affect their lives.

The second day will focus on potential policy solutions with Lisa Gill of Consumer Reports; Pooja Babbrah of Point-of-Care Partners; Stacie Dusetzina, an associate professor of health policy at Vanderbilt University Medical Center; and Jane Horvath of Horvath Health Policy.

SENATE PANEL PROBES VACCINES AND PREVENTABLE DISEASE OUTBREAKS

The Senate HELP Committee on Tuesday will hold a hearing on the re-emergence of vaccine-preventable diseases in the United States.

Chairman Lamar Alexander, R-Tenn., and the top Democrat on the committee, Sen. Patty Murray, D-Wash., said the committee wants to understand why there's an increase in incidences of diseases like measles despite the long-standing availability of vaccines.

Witnesses include Dr. John Wiesman, secretary of health in Washington state; Saad Omer, professor of epidemiology and pediatrics at Emory University in Atlanta; Dr. Jonathan McCullers, chairman of the Department of Pediatrics at the University of Tennessee Health Science Center in Memphis; John Boyle, CEO of the Immune Deficiency Foundation; and Ethan Lindenberger, a student at Norwalk High School in Ohio.

Last week, Dr. Anthony Facui, the director of NIH's Institute for Allergy and Infection Diseases, and Dr. Nancy Messonnier, director of CDC's National Center for Immunization and Respiratory Diseases, testified before a House subcommittee that is examining the government's efforts to contain the spread of measles.

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