Health Update (June 10)
House Energy & Commerce Hearing
The House Energy & Commerce Committee’s Subcommittee on Health held a hearing on Tuesday (June 4) entitled “Investing in America’s Health Care.” Members from both sides of the aisle focused much of their attention at this hearing on emphasizing the need to fix the Disproportionate Share Hospital (DSH) cuts that were brought forth from the Affordable Care Act, and also how to fund community health centers and research into new treatments for diabetes, especially Type 1 diabetes.
During the questioning of the first panel of witnesses, both sides stressed the need to ensure continued funding for all of the programs under review, with the main disagreements coming along the lines of exactly how much spending should be approved. Committee Democrats strongly supported funding most of the community health centers and diabetic services, and even suggesting extending the length of the reauthorization. However, Ranking Member Michael Burgess (R-TX) and fellow Republican committee members were concerned about the significant funding increases without specifying offsets. The importance of DSH and their looming cuts dominated the main topics amongst the second panel of witnesses as they all stressed the need for another delay of the cuts and a change in allotments within the program. There was unanimous consent from both parties that there needs to be changes in DSH cuts.
To read a more detailed summary of this hearing, click here.
With an upcoming targeted release date of June 13th for his drug pricing proposal, Senate Finance Committee Chairman Chuck Grassley (R-IA), spoke at an Axios event this week to promote the effort.
Chairman Grassley detailed how he hopes to cap seniors’ out of pocket costs in Part D and reduce the government’s share of catastrophic phase coverage — currently 80 percent of the cost when patients hit the threshold — over time. It is believed this bill will look to target Medicare Part B payment structures. Those Part D changes tracks with a House plan from Ways and Means and Energy and Commerce committee leaders. But while the House draft focuses on shifting those costs to payers over time, Grassley sat down for an interview with Axios to discuss the proposal and suggested drugmakers could also be on the hook.
Grassley added that he is not convinced that drugmakers would lower their prices under the White House’s plan to eliminate rebates that government plans pay to pharmacy benefit managers. The administration has pushed Congress to pass legislation applying its rebate plan to commercial insurers.
Grassley said drug companies and PBMs were “finger pointing” and that there’s a need for better understanding of how the PBM process works and prices are set. 
Pelosi Drug Pricing Plan
Pelosi’s office has been working on a plan for months that would allow Medicare to negotiate drug prices, a top priority for Democrats and one that the party stressed in its campaign last year to win back the House. Most recent news reports indicate that draft plan could be released as early as next week.
There is now an intense debate within the Democratic caucus over the details of that proposal, with the Progressive Caucus pushing for a bill authored by Rep. Lloyd Doggett (D-TX) that it says is stronger because it would strip a company of its monopoly on a drug if the manufacturer refuses to agree to a reasonable price in Medicare negotiations.
Progressive lawmakers argue they cannot properly weigh in on Pelosi’s plan because they have not seen anything on paper. After months of rumors, Pelosi presented an outline of the plan two weeks ago in a private meeting.
Democratic leaders will likely need progressives to help pass a drug pricing bill if it eventually comes to the floor, but liberal lawmakers say they can’t pledge support for legislative text they haven’t seen. 
Surprise Medical Bills
Last month, a bipartisan working group In the Senate unveiled legislation that the group’s leader — Bill Cassidy (R-LA.) — billed as hitting the “sweet spot” between rival interests. The bill sets an automatic payment at the median in-network rate, which can be appealed to an independent arbiter.
The high-profile issue has drawn an unusual amount of bipartisan cooperation. Still, a central task for congressional health committees in the coming weeks is whether they can agree on an arbitration process for settling payment disputes between health plans and providers or find another way of holding patients harmless, such as automatic payments based on a benchmark.
One wild card is whether the Trump administration will endorse a specific legislative proposal — the White House has already given a thumbs down to the arbitration approach — and how that could alter the dynamic.
Senate HELP Committee
There appears to be more optimism amongst others in the Senate as HELP Committee Chairman Lamar Alexander (R-TN) expressed concerns about the so-called “baseball-style” arbitration approach. He and the panel’s top Democrat, Sen. Patty Murray (D-Wash.), have introduced a discussion draft of a broad bill to tackle health care costs but haven’t settled on exactly how to tackle surprise billing. The pair solicited feedback from industry groups on three options with the current comment period closing last week.
Alexander is pursuing an aggressive timeline for passing legislation out of his committee: a legislative hearing, bill introduction and markup before the end of June, according to a GOP committee aide.
Movement in the House
Meanwhile, House Energy and Commerce leaders are promoting a draft plan they released last month that would settle billing disputes by creating a minimum payment standard set to the median in-network rate for that area.
Other committees with jurisdiction may weigh in, and there are alternative plans circulating, such as a bill H.R. 861 from Ways and Means health subcommittee Chairman Lloyd Doggett (D-Texas) and a doctor-supported bipartisan outline from emergency physician Rep. Raul Ruiz (D-Calif.) and OB/GYN Rep. Phil Roe (R-Tenn.).
Sen. Cassidy, with his own bill, contends lawmakers aren’t really that far apart, and that the differences can be reconciled. Health care lobbyists remain optimistic Congress will pass legislation, though when is an open question. 
HHS Fetal Tissue Research Issues
The Trump administration Wednesday (June 5) imposed new restrictions on federal use of fetal tissue obtained from abortions, barring government scientists at the National Institute of Health (NIH) from doing such research, and canceling an existing HIV research contract with the University of California, San Francisco.
The U.S. Department of Health & Human Services (HHS) also said it will impose new ethics reviews on government-funded research at universities and other scientific centers seeking to use fetal tissue, potentially affecting more than $100 million in contracts. It will also continue to explore if there are alternatives to using tissue derived from abortion at all, an initiative that has divided the health department since it was announced last year.
The decision came after a heated debate within the Trump administration that pitted the White House against HHS, which sought a less restrictive policy. The new restrictions had been closely guarded and fiercely debated within the Trump administration. Acting White House Chief of Staff Mick Mulvaney and domestic policy chief Joe Grogan had pushed for the outright ban on NIH using fetal tissue obtained from abortion. HHS Secretary Alex Azar had argued for a less restrictive policy that would have allowed ongoing research on tissue acquired from research institutions.
HHS currently funds about 200 outside projects that use fetal tissue obtained from abortion, but those contracts will not be immediately affected or undergo additional review, an agency spokesperson said. HHS will appoint an ethics advisory board to review future research projects that use fetal tissue and seek federal funding. 
On Wednesday, June 12, 2019, the House Ways & Means Committee will hold a hearing entitled “Pathways to Universal Health Coverage.”
On Wednesday, June 12, 2019, the House Energy & Commerce Committee will hold a hearing entitled “Protecting from Surprise Medical Bills.”
On Wednesday, June 12, 2019, the Senate Judiciary Committee will hold a hearing entitled, “Competitive Implications of Vertical Consolidation in the Healthcare Industry.”
 Owermohle, Sarah. “Grassley hints drugmakers could pick up more costs for Medicare Part D.” Politico Pro. 5 June 2019.
 Sullivan, Peter. “Liberals rip Democratic leaders for writing drug pricing bill in secret.” The Hill. 6 June 2019. https://thehill.com/homenews/house/447210-liberals-rip-democratic-leaders-for-writing-drug-pricing-bill-in-secret
 Roubein, Rachel. “Congress still searching for accord on ‘surprise’ medical bills.” Politico Pro. 4 June 2019; https://subscriber.politicopro.com/article/2019/06/congress-still-searching-for-accord-on-surprise-medical-bills-1499604
 Johnson, Eliana. “Pushed by anti-abortion groups, HHS restricts fetal tissue research.” Politico Pro. 5 June 2019. https://subscriber.politicopro.com/article/2019/06/pushed-by-anti-abortion-groups-hhs-restricts-fetal-tissue-research-1509359