18 Dec December 18, 2017
(NOTE: The Weekly Report will not be published until January 8. Have a wonderful holiday!)
GOP Tax Bill Vote Tuesday; Major Health Care Changes Made
The House is expected to pass the GOP tax reform bill Tuesday. The Senate has the 51 votes it needs to pass the bill and a vote is also expected to occur this week. Click here for the 570-page plain-language conference report. Click here for the 1,097-page actual legislative text. Key health care issues:
- Individual mandate is eliminated;
- Private activity bonds – Senate prevails – no changes to current law (pages 307-309 conference report);
- Rehabilitation credit – Senate prevails with modification to transition rule (pages 284-285 conference report);
- Advance refunding bonds – House and Senate were the same – no changes (page 310-311);
- Medical expense deduction: stays at 10 percent, expanded to 7.5 percent for two years;
- 21 percent excise tax imposed on tax exempt employer for top 5 employees with over $1 million compensation (pages 346-349 conference report)
Among other changes: The bill keeps the tax waiver for reduced tuition for graduate students. Medical schools and academic health centers had pushed for preserving that tax waiver, which makes graduate medical study more affordable. It would also establish a 1.4% excise tax on net investment income earned by private university endowments. Academic medical centers had argued the new tax would cut into income they use to provide activities that advance their community mission.
- PAYGO: the Congressional Budget Office estimated that passing the tax bill would trigger an automatic $25 billion cut in Medicare in 2018 to offset the reduced revenue, under the Pay As You Go rule. GOP leaders have vowed to waive “PAYGO” requirements as part of the year-end funding legislation. Click here for a good summary of the PAYGO requirements.
Click here for a good NYTimes summary of the major provisions in the tax bill.
Congress Faces Government Shutdown This Week; Many Health Care Programs at Stake
The federal government is funded only through December 22. Congress is working on a spending bill that will fund the government beyond that date – whether it will be funded into early next year or for another year, remains to be seen. Key health care issues on the table: — Children’s Health Insurance Program. Expired September 30. There is agreement on 5 year extension. — Medicare Extenders (click here to see the Ways and Means deal cut in November): However, the House has proposed cutting CAH swing bed payments to help pay for this bill. The Senate is likely to have a different perspective on how to pay for this. The CAH Coalition continues fighting the cut to swing beds. Click here for details. — DSH cut delay. There is general agreement on a two-year delay in the Disproportionate Share Program payment cuts that are otherwise scheduled to take effect in 2018. They would pay for the delay by either adding a couple of years on to the current reduction schedule, or increase the amount of the cut over several years.
— PAYGO: (see previous story) Waiver expected to be included in spending bill.
— A provision to to fund insurers’ cost-sharing reductions would not offset premium increases that would likely happen when the ACA’s individual mandate is repealed, according to actuaries. This provision, being pushed by Democrats and several GOP senators, may be included in the final spending bill. Click here.
- House Appropriators last week introduced a bill to keep the government open until January 19 and fund the Childrens Health Insurance Program for five years. However, the legislation includes controversial pay-fors that Democrats most likely will not accept. The bill, H.J.Res 124, would also fund community health centers for two years. The legislation also waives automatic cuts to defense funding and temporarily delays the automatic cuts to non-defense funding, which are slated to occur in January under the “sequestration” rule. Click here for the bill. The Senate is drafting a very different bill, according to various Hill sources.
146 House Members on Bill To Postpone CMS’ 340B Payment Cut There appears to be agreement around enacting legislation, as part of the year-end spending bill, that would prohibit CMS from issuing regulations impacting 340B for at least one year and maybe two years. — 146 House members have now cosponsored the McKinley bill to stop the CMS reg. Click here for the latest list. Hospitals are being urged to contact their Representatives this week and urge their active support of the 340B regulation delay. — Six senators (3 GOP, 3 Dems) sent letter to their leadership urging a one-year delay in the regs. — Ways and Means Committee has floated an amendment that would delay the CMS regs for 2 years.
However, big pharma is pushing back and working to add new 340B reporting requirements, as part of the deal.
- New research finds that hospitals in California, North Carolina, and New York will experience the greatest drug payment cuts nationally, ranging from $126M to $62M, as a result of recent changes to the way Medicare pays for 340B drugs. Overall, six states will see drug payment cuts of more than $50M in 2018. Click here for the Avalere study.
House Bill Would Keep Government Funded for Two Months with CHIP Reauthorization
House Appropriators last week introduced a bill to keep the government open until January 19 and fund the Childrens Health Insurance Program for five years. However, the legislation includes controversial pay-fors that Democrats most likely will not accept. The bill, H.J.Res 124, would also fund community health centers for two years. Democrats had rejected that bill because it was funded by controversial cuts, including the ACA Prevention and Public Health Fund. The legislation also waives automatic cuts to defense funding and temporarily delays the automatic cuts to non-defense funding, which are slated to occur in January under the “sequestration” rule. Click here for the bill.
New Bills Would Delay or Repeal ACA Taxes
House Ways and Means Committee Republicans last week introduced several bills that would either repeal or delay some of the Affordable Care Act’s taxes. The bills may lead to negotiations with Democrats to craft a package that would also extend certain Medicare payment policies. Among the bills: a repeal of the medical device tax for five years, elimination of health savings account restrictions on over-the-counter drugs, repeal the health insurance tax for some insurance plans over the next two years, repeal the health insurance tax for all plans in Puerto Rico for two years, and a delay of the Cadillac tax on high-cost employer health plans for one year. Click here for more from the Ways and Means Committee and to view the legislation.
As Healthcare.gov Sign Up Period Ends, Enrollment Spikes
More than one million people signed up through December 9 for health insurance under the Affordable Care Act, pushing the total in the federal marketplace to nearly 4.7 million, the Trump administration said last week, days before the annual enrollment period is scheduled to end. The number of sign-ups on HealthCare.gov from Nov. 1 through last Saturday was about 17 percent higher than the same time last year. But the final tally is likely to fall short of the 9.2 million who were in plans at the end of the last open enrollment period, which was twice as long as the current one. Click here for details. To see a county-by-county map of exchange insurance coverage for 2018, click here. In states that run their own exchanges, the last day to sign up for coverage is: — California, New York, Washington, D.C.: Jan. 31 — Massachusetts: Jan. 23 — Washington: Jan. 15 — Minnesota: Jan. 14 — Colorado: Jan. 12 — Rhode Island: Dec. 31 — Connecticut, Maryland: Dec. 22
Lab Association Sue CMS Over New Fee Schedule
Clinical laboratories last week sued CMS over the finalized fee schedule for tests. The American Clinical Laboratory Association states that CMS illegally exempted nearly all hospital laboratories in the determination on which the new reimbursements are based, leading to much lower rates in the fee schedule. The group is asking the Federal District Court to require CMS include more hospital labs rates in the collection of commercial market pay rates. Medicare pays more for lab tests than commercial payers, so the Protecting Access to Medicare Act directed CMS to base reimbursement on commercial-payer rates by collecting price data from labs. Hospitals, that account for 25 percent of CMS’ spending on lab tests, are paid higher rates than free-standing labs mostly due to overhead costs and expedited needs. Click here for the complaint filed by ACLA.
States Running Out of CHIP Funding
As Congress continues to debate how it will reauthorize the Children’s Health Insurance Program, some states have required emergency funds to keep their programs going, while others have determined that they may be a few months away from running out of money for the program. CHIP, which officially expired on Sept. 30, covers 8.9 million children in working families who earn too much to qualify for Medicaid but cannot afford or access private coverage. A new analysis shows that about three-quarters of states anticipate exhausting funding by the end of March 2018 and that several states have begun or will begin notifying families about coverage reductions before the end of 2017. With this data, the Kaiser Foundation compiled a map showing when states will exhaust funds, click here.
Senate Committee Examines Opioid Funding, Mental Health Efforts The nation’s top mental health official said that she will work with Congress on tweaking the formula used to determine how much funding states receive to battle the opioid epidemic. It’s too late to change that formula for the upcoming and final round of two batches of opioid dollars provided by the 21st Century Cures Act, according to Elinore McCance-Katz, the country’s first Assistant Secretary for Mental Health and Substance Use, a position created by that law. She told lawmakers last week that a recently announced round of supplemental opioid funding will take into account not just the rate of opioid deaths in a state but also the year-over-year increase. Click here to read her written testimony and view the hearing.
- The FDA is seeking help on ways to reduce how many opioid pills doctors prescribe, including mandating that providers justify to drug companies when higher amounts of the painkillers are needed, click here.
- The Washington Post describes DEA’s failed attempt to hold one of the nation’s largest drug companies accountable for its opioid distribution practices. Click here.
- Aetna said it will waive the copay on the anti-drug overdose drug Narcan for some customers starting on Jan. 1., and cap the supply for some first-time opioid prescriptions to seven days. Copays will be waived for 4.5 million Aetna fully insured commercial members, but not the insurer’s 13.5 million self-insured customers. Click here.
What’s Causing High Drug Prices? Depends on Who’s Asked
Drug industry representatives are singling out pharmacy benefit managers who don’t set prices for medicines but influence consumers’ out-of-pocket costs, as a major reason for the high cost of drugs. Witnesses in a congressional hearing last week also laid much of the blame on the drug companies themselves, which set the prices, as the primary culprit. The hearing included 10 witnesses representing drug companies, insurers, distributors, hospitals, doctors, pharmacists and patients. Finger-pointing was rampant, primarily between the drug companies and pharmacy benefit managers. Subcommittee Chairman Michael C. Burgess, R-TX, urged the health care industry to come up with its own solutions to the problem otherwise Congress would be forced to act in ways they might not like. Click here to read written testimony and view the hearing.
Higher Education Bill Changed To Combat Opioid Crisis
The House Education and Workforce Committee last week adopted two amendments to legislation to overhaul higher education that aim to combat opioid abuse on college campuses. Lawmakers approved Republican and Democratic amendments to the bill, H.R. 4508, the Promoting Real Opportunity, Success, and Prosperity through Education Reform (PROSPER) Act.
- Rep. Lloyd Smucker’s (R-PA) amendment would require the secretaries of Education and Health and Human Services to work with outside experts to identify best practices for preventing substance abuse on campus, clickhere.
- Rep. Carol Shea-Porter’s (D-NH) amendment would require colleges and universities to include information on “opioid abuse prevention, harm reduction, and recovery” in their drug prevention programs, click here.
For more on the PROSPER Act, click here.
7 Words, Phrases May Be Banned at CDC
Health leaders say they are alarmed about a report last week that officials at the nation’s top public health agency are being told not to use certain words or phrases in official budget documents, including “fetus,” ‘’transgender” and “science-based.” Click here.
CMS Seeking Nominations for Quality Payment Panels
CMS is requesting nominations for technical expert panels to assist with policies impacting the Quality Payment Program developed under MACRA. Panelists for the MACRA Measure Development Plan Technical Expert Panel (nominations due Wednesday, December 20) will provide clinical, scientific, and technical expertise related to clinician- and specialty-specific measure development for the QPP. The Merit-based Incentive Payment System (MIPS) Improvement Activities Technical Expert Panel experts (nominations due Friday, January 12) will review Improvement Activities under the QPP. Click here for more on the expert panels and the nomination process from CMS.
Government Group Issues Recommendations on Mental, Behavioral Health
A new federal committee has come out with recommendations for how the government can improve care for the 10 million adults with serious mental illness and 7 million adults and children who have serious emotional disturbances each year. Among the improvements called for: — Coordinate federal efforts more effectively. — Expand access to evidence-based best practices. — Steer people with serious mental illness or emotional disturbances to health settings instead of the criminal justice system. (Two million people with serious mental illness are incarcerated each year.) — Find ways to improve the availability and affordability of care.
Click here for the report.
Obamacare Has Highest Approval Ever
The Affordable Care Act is polling at 56 percent approval, according to a new poll by the Pew Research Center. This represents the highest approval rate that Pew has found since it began tracking American’s views on the ACA seven years ago, up from 44 percent approval in April 2016. In it’s analysis of the poll, Pew notes that women are about twice as likely to say they approve of the law, with 61 percent saying they approve versus 31 percent who disapprove. Pew also states that a growing number of those polled say the law has had a positive personal effect on them over the past year with 28 percent with a positive, up from 23 percent in April 2016. For more on the poll’s results from Pew, click here.
New Procedure a ‘Game Changer’ for Irregular Heart Beat
A new treatment is being touted as a “game changer” for patients with an irregular heart beat. The condition kills an estimated 325,000 Americans each year, the most common cause of death in this country. Click here for the report.