United States: Capitol Hill Healthcare Update - July 15, 2019

Below is this week's "Capitol Hill Healthcare Update," which is posted on Mondays when Congress is in session.


With only 15 legislative days before a scheduled monthlong recess, Senate leaders are scrambling this week to seek consensus on ambitious legislation to lower prescription drug prices, particularly after major pharmaceutical industry initiatives by the Trump administration were derailed last week.

Senate Finance Committee leaders Charles Grassley, R-Iowa, and Ron Wyden, D-Ore., have been working for months on a package of bills to lower drug prices – and they are hinting a deal is close.

The senators appear to have agreed on the outlines of a plan that would impose inflation caps on prices for drugs in the Medicare Part D program by requiring manufacturers to pay rebates to the government if prices rise faster than inflation. Multiple price transparency provisions are also expected to be included.

The Senate HELP Committee and Senate Judiciary Committee already approved separate measures on drug pricing, and senators hope to package those bills with the Finance Committee product for a vote on the Senate floor this month.

But the sticking point remains allowing for government negotiation of drug prices. That's a nonstarter for most Senate Republicans but a key priority for Democrats – each of the seven senators seeking their party's presidential nomination have endorsed it. All but one Democrat on the Finance Committee – Sen. Robert Mendez, D-N.J. – sent a letter last week to Grassley and Wyden urging them to include government negotiation, too.

It's not clear that Senate Democratic leaders would allow drug pricing legislation to advance to a vote if it falls short of government negotiation, even if the underlying bill included other significant reforms.


The House Energy and Commerce Committee this week is expected to vote on 10 different bills addressing prescription drug costs, surprise medical billing and reauthorization of public health programs.

The Health Subcommittee last week advanced the legislation as a series of separate bills.

But amid broad bipartisan agreement on the need to protect patients from surprise medical bills, disagreements over how to do so could hamper progress. The subcommittee approved legislation authored by Energy and Commerce leaders Frank Pallone, D-N.J., and Greg Walden, R-Ore., but negotiations are ongoing over the mechanism to settle payment disputes. Two doctors on the panel, Reps. Raul Ruiz, D-Calif., and Larry Bucshon, R-Ind., want independent mediation while the Pallone-Walden legislation calls for a federal benchmark rate to settle disputes. The Senate HELP Committee last month approved legislation using the Pallone-Walden approach.

The committee also is expected to approve an amended version of legislation by Rep. Jan Schakowsky, D-Ill., that would require drugmakers to justify price increases of more than 10% in one year or 25% in three years.

Also scheduled for a vote is legislation by Rep. James Langevin, D-R.I., to reauthorize federal funding for the Lifespan Respite Care Act, which provides state grants to support caregivers nationwide who provide care for loved ones with chronic, disabling health conditions. First introduced by former Rep. Mike Ferguson, R-N.J., and enacted in 2006, the law has led to grants in 37 states and the District of Columbia. (Ferguson is now the leader of BakerHostetler's Federal Policy team.)


In a win for the medical device industry, the House Energy and Commerce Committee this week is scheduled to vote on drug pricing legislation that requires pharmaceutical manufacturers – but not device companies – to disclose the value of product samples given to physicians.

A separate committee in April approved a package of drug pricing bills that would expand the Sunshine Act's reporting requirements to include both drug and device samples – setting up a potential clash as the underlying drug pricing bills move to the House floor.

Advocates of requiring manufacturers to report on product samples said they want visibility into the correlation between drug samples provided to doctors and the prescriptions physicians write.

Since the April vote, the device industry has argued there is no evidence linking samples to increased utilization. Also, manufacturers of contact lenses and syringes argued it could disrupt the practice of medicine as physicians use samples to educate patients on proper usage. If companies were forced to catalogue and disclose the value of samples – something they're not currently doing – they could stop providing samples to avoid the compliance costs.

The Energy and Commerce Health Subcommittee last week approved an amended version of legislation that would require reporting on drug price increases and drug samples, but not device samples.


The House is scheduled to vote Wednesday on legislation to repeal the Affordable Care Act's excise tax on high-cost health plans, a priority for congressional Democrats and their political allies in organized labor, which often negotiate robust health insurance coverage for their members.

Repealing the so-called Cadillac tax comes with a huge price tag – reducing government revenue by $193 billion over a decade, according to the Congressional Budget Office.

Introduced by Rep. Joe Courtney, D-Conn., the repeal bill has 359 co-sponsors in the House.

The tax would impose a 40% surcharge on employer-provided plans costing more than $11,200 for individuals and $30,100 for families. The tax is scheduled to take effect in 2022 after already being delayed twice by Congress.

While the Senate is not likely to pass the bill, its House passage would give Senate Republican leaders a tactical advantage. Under the Constitution, all tax bills must originate in the House; the Senate could amend the Cadillac tax bill with any other tax provisions and send the amended bill back to the House.


Legislation introduced in the Senate last week would speed Food and Drug Administration approval of generic and follow-on insulin.

Introduced by Sens. Dick Durbin, D-Ill., Tina Smith, D-Minn., and Kevin Cramer, R-N.D., the bill would require the FDA to continue to review applications for generic insulin even after the agency's internal March 2020 date to end consideration. The FDA established that date as an application termination cliff in part to promote biosimilars.

As Congress examines the prescription drug issue, the price of insulin – first discovered in 1921 – has been the subject of congressional hearings. Insulin prices have increased tenfold since 2001.

The Senate legislation won the endorsement of the Diabetes Patient Advocacy Coalition, the National Diabetes Volunteer Leadership Council and Children with Diabetes.


Bipartisan legislation introduced in the Senate last week would increase federal funding for palliative care research and to train a nationwide hospice workforce.

Introduced by Sens. Tammy Baldwin, D-Wis., and Shelley Moore Capito, R-W.Va., the bill aims to enhance training for new and existing physicians, and for those who teach palliative care.

The legislation also would provide academic and career awards to incentivize the practice and study of palliative and hospice care.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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