Washington Watch for February 2020
Carter L. Alleman, J.D.
Senate and House Briefed on Coronavirus
Areas in central China are experiencing an outbreak of a new SARS-like coronavirus that can cause sometimes fatal pneumonia. The outbreak was first identified in Wuhan in early December. Since then, cases have been reported in South Korea, Thailand, and Japan. There have been 1,372 confirmed cases of the virus in total, and 41 deaths. China has shut down travel to and from cities around Wuhan. The World Health Organization (WHO) has confirmed that the virus can be passed from human to human, not just from animal to human.
At least five cases have been confirmed in the United States, all people who recently traveled to China. More cases are expected to emerge in the coming weeks. The State Department and the Centers for Disease Control and Prevention (CDC) have issued a travel advisory, warning U.S. citizens against taking unnecessary trips to the affected areas of China. Airport checkpoints have already been set up in Atlanta, Chicago, New York, San Francisco, and Los Angeles to screen passengers coming from China.
Lawmakers and congressional staff have been briefed by the CDC, the U.S. Department of Health and Human Services (HHS), and State Department officials about the situation. Lawmakers have called on China to be fully transparent about the virus outbreak, and some have raised concerns about whether China is doing enough to prevent its spread. Senate Health, Education, Labor, and Pensions (HELP) Committee Chairman Lamar Alexander (R-Tenn.), who also serves on the Senate Appropriations Committee, has said that Congress is prepared to provide whatever funding is necessary for agencies to combat the virus.
Rep. Debbie Dingell (D-Mich.) has written to CDC Director Robert Redfield to express her concerns with the spread of the coronavirus. “Given the spread of this virus, as well as indications that human-to human transmission is occurring, it is imperative that Congress and the American people be kept up-to date on the latest steps that CDC is taking in light of these developments,” the letter states. New Jersey senators Cory Booker (D) and Robert Menendez (D) have called on Redfield and Secretary of State Mike Pompeo to send supplemental resources to U.S. airports that screen passengers daily from affected countries.
NH Delegation Requests Continued Opioid Response Grant Funding
Jeanne Shaheen (D-N.H.) and Maggie Hassan (D-N.H.) and Reps. Anne Kuster (D-N.H.) and Chris Pappas (D-N.H.) are asking the Trump administration to continue funding for the state opioid response (SOR) grant program in the President’s fiscal year (FY) 2021 budget proposal. They request at least $1.5 billion be allocated for the program in the coming year, in line with the amount provided in FY 2019 and 2020. They also request that the administration support continued flexibility for the use of the SOR grants so that states can address the full range of substance use disorders (SUD).
Supreme Court Will Not Hear Expedited ACA Appeal
The U.S. Supreme Court has declined a request from the House of Representatives and a group of mostly Democratic states to consider their petition for an expedited review of the current Affordable Care Act (ACA) lawsuit. A federal appeals court struck down the ACA’s individual mandate last month, while skirting the question of the law’s overall constitutionality. The decision keeps the ACA in effect for the time being, while remanding the case back to a federal judge in Texas to determine how much of the rest of the law, if any, is also unconstitutional. The high court’s latest decision most likely means that the fate of the 2010 health care law will not be decided until after the 2020 presidential election.
CMS to Announce Medicaid Changes
The White House is expected to announce an overhaul of the Medicaid program. The administration’s proposed changes would provide states with additional flexibility to shift some program funding to block grants. The plan would encourage states to apply for Section 1115 waivers to allow them to cap spending on Medicaid patients who joined the program under the ACA’s coverage expansion. The changes will be unveiled during a HHS event titled “Transforming Medicaid: A New Opportunity for Better Health.” While Centers for Medicare and Medicaid Services (CMS) Administrator Seema Verma has previously discussed the potential for block grants to restrain Medicaid spending and improve program outcomes, administration officials have acknowledged that they expect the block grant policy to be challenged in court.
FDA Working to Address Agency Workforce Shortages
The FDA is trying to appeal to prospective employees’ sense of mission to improve the agency’s chronic staffing problems. In a recent interview with Politico, Principal Deputy Commissioner Amy Abernethy explained that the FDA wants young physicians and scientists to know that their time spent at the agency will be an important contribution to the country, and that they can expect to learn new skills on the job. The FDA saw a net gain of 135 employees in fiscal year (FY) 2019 – hiring 1,637 individuals while losing 1,502. This is a slight improvement over FY 2018, when 1,685 people joined the FDA and 1,586 left. The time it takes to bring a new hire on board has also improved thanks to authorities contained in the 21st Century Cures Act – onboarding now takes an average of 42 days, down from the previous length of more than a year.
ACP Endorses Medicare-for-All
The American College of Physicians (ACP) announced its endorsement of a “Medicare-for-All” health care system. In an Annals of Internal Medicine policy paper, the organization representing medical internists also detailed its own recommendations for transitioning to a single payer or public option with the goal of achieving universal coverage. ACP is the largest medical specialty society to announce its support of “Medicare for-All.” It previously backed a narrower public option approach but has shifted its position in response to the nation’s high cost of care and the number of patients that remain uninsured or underinsured. The ACP’s recommendations will be circulated among health care stakeholders including hospitals, insurers, and pharmaceutical companies for feedback.
Impeachment Trial Begins
Senate Majority Leader Mitch McConnell (R-Ky.) announced that the Senate will start debating an organizing resolution to begin President Trump’s impeachment trial on Tuesday. The organizing resolution will determine time limits for opening arguments from the House impeachment managers, opening arguments for the president’s defense team, and for senators to ask questions. It is unclear at this time how long the trial will last. Negotiations are underway regarding what other Senate business may continue during impeachment. It is hoped that committees will be allowed to hold hearings in the morning (if the proceedings are bipartisan) and that cosponsors may be added with unanimous consent. The introduction of bills and resolutions would require consent as well. However, legislative and executive hotlines will not be run during impeachment.
JAMA Examines Changes in FDA Drug Approvals
A new report from the Journal of the American Medical Association (JAMA) indicates that the FDA is increasingly approving new drugs with fewer clinical trials. The analysis found that the number of drugs approved based on two pivotal trials decreased from 81 percent in 1995-1997 to 53 percent in 2015-2017. The number of drug applications including at least one pivotal trial in comparison to another drug decreased from 44 percent to 29 percent. The report also finds that an increasing number of companies are testing their products against a placebo or using historical data for evaluation.
Court of Appeals Considers White House DTC Advertising Rule
The U.S. Court of Appeals for the District of Columbia Circuit appear unlikely to reverse a July district court ruling that the U.S. Department of Health and Human Services (HHS) does not have the authority to require pharmaceutical manufacturers to disclose list prices in direct-to-consumer (DTC) advertising. Members of the three-judge panel questioned whether the regulation would increase Medicare and Medicaid administrative efficiency as HHS has argued.
They also expressed doubt that the proposal would actually help control drug spending and noted that it would still not allow for consumers to evaluate the relative costs of different drugs. Merck, Eli Lilly, Amgen, and the Association of National Advertisers are suing HHS, asserting that the policy would confuse patients and discourage them from accessing treatment.
EPA Revises EtO Regulation
The Environmental Protection Agency (EPA) has revised a regulatory notice that sought information about how companies could use lower levels of ethylene oxide (EtO) in the sterilization of medical devices following objections from the FDA. The FDA argued that the EPA only has authority over releases of the chemical into the air, not over how much of it is used in sterilization plants. The EPA is attempting to update its emission standards in light of findings that EtO is at least 30 times more carcinogenic than previously thought.
USMCA Approved by Senate, Awaits Canadian Passage
The Senate passed the legislation to ratify the U.S.-Mexico-Canada Agreement (USMCA) last week by a vote of 89- 10. Minority Leader Chuck Schumer (D-N.Y.), Bernie Sanders (I-Vt.), Kirsten Gillibrand (D-N.Y.), Cory Booker (D-N.J.), Kamala Harris (D-Calif.), Ed Markey (D-Mass.), Sheldon Whitehouse (D-R.I.), Jack Reed (D-R.I.), Brian Schatz (D-Hawaii), and Pat Toomey (R-Pa.). voted against the proposed trade pact. The Democrats who voted against the measure cited concerns about weak environmental standards, while Sen. Toomey argued that the agreement would increase prices for American consumers. The overhaul of the North American Free Trade Agreement (NAFTA) was approved by the Senate Finance Committee and six other panels earlier in the week. It will now be sent to the President’s desk for his signature but will not go into full effect until it is approved by Canada. The Canadian parliament will reconvene later this month, where the deal is expected to pass. The USMCA is projected to add 0.35 percent to the U.S. gross domestic product (GDP) after six years.
Phil Roe, MD Will Not Run for Reelection
Rep. Phil Roe, MD (R-Tenn.) has announced plans to retire at the end of the year. Roe was first elected to Congress in 2008 following a 31-year career as an OB/GYN in Johnson City, TN. He serves as co-chair of the GOP Doctors Caucus and has been a leader in patient-centered health policy. He is he the lead Republican on the Veterans Affairs Committee and served as the 115th Congress. He’s also a senior member of the House Education and Labor Committee which has health jurisdiction and oversight authority of self- insured health insurance (ERISA) plans. Roe’s 1st congressional district of Tennessee is expected to remain one of the most Republican-leaning districts.
Supreme Court to Consider State Regulation of PBMs
The Supreme Court has accepted a request from the state of Arkansas to review an appeals court ruling that blocked the regulation of pharmacy benefit managers (PBMs) on the grounds that such activity is preempted by the Employee Retirement Income Security Act (ERISA). Attorneys general from 31 states and the District of Columbia have also asked the court to reverse the lower court ruling. The 2015 Arkansas law that would have required PBMs to raise reimbursement rates for drugs if they fell below the pharmacy’s wholesale costs was challenged by the Pharmaceutical Care Management Association. State attorneys argue that PBM regulation is critical to a state’s ability to increase access to and improve the transparency of the prescription drug marketplace.
Administrative Health Care Costs on the Rise
The cost of healthcare bureaucracy in the U.S. has increased to $812 billion annually, according to a nationwide study of domestic spending on administrative costs. The report, which was published in the Annals of Internal Medicine, attributes the growth to the expansion of Medicare Advantage (MA) and Medicaid managed-care plans. Administrative costs now account for one-third of health care spending on doctor visits, hospitals, long-term care, and health insurance. The study found that the nation spent $2,379 in administrative costs per person in 2017.
Health Care Remains Top Issue for Voters
A new poll from the Bipartisan Policy Center finds that health care is once again a top issue for voters this year, who rank it above the economy, immigration, taxes, and gun control. The poll shows greater support for incremental changes to the current health care system than for sweeping policy changes like repeal of the Affordable Care Act (ACA) or passage of Medicare-for-All. Medicaid work requirements polled favorably amongst Republican respondents, while improving the cost and quality of care has strong bipartisan support.
Sasse, Loffler to Fill Senate Vacancies
Given Sen. Johnny Iskason’s (R-Ga.) retirement at the end of 2019, it was announced that the resulting vacancies on the Senate Finance Committee and the Senate Committee on Health, Education, Labor, and Pensions (HELP) will be filled by Sen. Ben Sasse (R-Neb.) and Sen. Kelly Loeffler (R-Ga.), respectively. Loeffler was appointed by Georgia Gov. Brian Kemp (R) to Iskason’s seat through 2020 and is expected to run in a November special election for the remainder of his term – through 2022. Ms. Loeffler will be sworn in by Vice President Pence later today.