Hart Health Strategies provides a comprehensive policy briefing on a weekly basis. This in-depth health policy briefing is sent out at the beginning of each week. The health policy briefing recaps the previous week and previews the week ahead. It alerts clients to upcoming congressional hearings, newly introduced bills, regulatory announcements, and implementation activity related to the Patient Protection and Affordable Care Act (PPACA) and other health laws.


Manchin, Schumer Reach Climate, Tax Deal

Sen. Joe Manchin (D-W.Va.) and Majority Leader Chuck Schumer (D-N.Y.) announced last week that they have struck a deal to reduce prescription drug prices, extend enhanced Affordable Care Act (ACA) subsidies, raise corporate taxes, and address climate change via the budget reconciliation process. The Inflation Reduction Act includes $739 billion in deficit-reduction measures over 10 years and $433 billion in spending, reducing the deficit by about $306 billion over a decade. The agreement contains $369 billion in climate and energy spending and $313 billion in corporate tax increases, as well as an increased tax on carried interest and increased tax-audit funding. The bill would direct the government to negotiate with pharmaceutical manufacturers to lower prices on certain medicines and cap what seniors on Medicare pay for drugs each year at $2,000. The measure also requires drug makers to rebate Medicare if their drug price increases exceed inflation. The agreement extends to 2025 expanded ACA premium subsidies, which are currently set to expire at the end of this year. Schumer also told reporters last week that he plans to include provisions in the package to lower the cost of insulin, without providing further specifics on what such provisions would entail.

Sen. Manchin and Democratic Whip Dick Durbin (D-Ill.), along with Sen. Lisa Murkowski (R-Alaska), have all tested positive for COVID-19 in recent days. Democrats need all their Senate members present to pass legislation through the budget reconciliation process, and in the evenly divided chamber, Democrats have been taking extra precautions to avoid any further members from contracting COVID-19. The Senate does not have a proxy voting system in place to allow floor votes to occur remotely. Sixteen Senate Democrats have reported testing positive for COVID-19 this year – with nearly every instance resulting in missed votes.

The Inflation Reduction Act is currently being reviewed by the Senate Parliamentarian to ensure that it complies with the chamber’s rules for budget reconciliation. The bill has not yet been endorsed by Sen. Krysten Sinema (D-Ariz.). Sinema has previously expressed opposition to closing the carried-interest loophole. Under the current budget resolution, Democrats have until September 30 to pass the reconciliation package. Leadership had hoped to complete work on the bill before leaving for August recess, but Schumer has told Democrats to be prepared to work through this weekend. The House of Representatives would then be expected to return for a short session in mid-August to vote on the package.

House Passes Cancer, Marijuana Research Legislation, Bill to Extend Telehealth Flexibilities

The House of Representatives passed several pieces of public health and healthcare-related legislation last week. The Gabriella Miller Kids First Research Act 2.0 (H.R. 623) reauthorizes the Gabriella Miller Kids First Research Program, a pediatric disease research initiative within the National Institutes of Health. The bill passed by an en bloc vote of 336-90. The Medical Marijuana and Cannabidiol Research Expansion Act (H.R. 8454) would streamline the registration process for conducting research with marijuana under the Controlled Substances Act. The bill passed on the House floor by a vote of 325-95.

The House also approved legislation to further extend the Medicare telehealth flexibilities first instituted in response to the COVID-19 pandemic. The Advancing Telehealth Beyond COVID-19 Act (H.R. 4040) would extend Medicare telehealth waivers through December 31, 2024, including geographic and originating site flexibilities, the types of providers eligible to provide telehealth, waiving of in-person requirements for behavioral health services, allowing for coverage of audio- only telehealth, letting telehealth satisfy face-to-face requirements for hospice care, and allowing qualified health centers and rural health clinics to cover and get reimbursed for telehealth services. The Congressional Budget Office estimates that the legislation will cost approximately $2.35 billion over two years. During floor debate, House Energy and Commerce Committee Chair Frank Pallone (D-N.J.) stated that a permanent extension was not considered because the CBO estimated it would cost another $20 billion, and that more oversight should take place before such a permanent change is made. The legislation was passed by a vote of 416-12. The Biden administration has stated that it strongly supports the bill. In the Senate, Finance Committee leaders have said that they are working to draft their own legislation to address the issue of telehealth.

Senate Democratic Appropriators Release FY 2023 Spending Bills

Senate Democratic appropriators released all 12 fiscal year (FY) 2023 funding bills last week. The nearly $1.7 trillion appropriations package includes $653 billion in non-defense discretionary spending, a 10.1% increase over FY 2022, and $850 billion in defense discretionary spending, an 8.7% increase over FY 2022 and consistent with the bipartisan National Defense Authorization Act passed by the House. The funding legislation would also decouple money for the Department of Veterans Affairs (VA) health programs from the broader spending bill, providing $118.7 billion for VA medical care, a 22% increase over FY 2022.

The package also includes $21 billion in emergency supplemental funding to provide the necessary resources to prepare for the next phase of the COVID-19 pandemic and to address other emerging diseases that pose a significant threat to public health. The supplemental appropriations bill provides $16 billion in emergency funding through the Public Health and Social Services Emergency Fund, including:

  • $9 billion to the Biomedical Advanced Research Development Authority for advanced research and development, manufacturing, production, purchase, and distribution of medical countermeasures against COVID-19 including vaccines, therapeutics, tests, diagnostics, and medical products and supplies;
  • $6.25 billion in flexible funding to allow the U.S. Department of Health and Human Services to purchase and distribute vaccines, therapeutics, and diagnostics to ensure a sufficient supply to meet demand if a new variant or surge of infections emerges; and
  • $750 million for research and clinical trials for vaccines focused on emerging coronavirus strains and to support domestic manufacturing capacity.

The bill also provides $5 billion in emergency funding to support the global response to the COVID-19 pandemic.
Of note, the Labor-Health and Human Services-Education appropriations bill includes:
  • $46.959 billion for the National Institutes of Health (NIH), a $2 billion increase or 4.4% over FY22 levels,
  • $1 billion for the Advanced Research Projects Agency for Health (ARPA-H), the same funding level as enacted in FY22,
  • $10.5 billion for the Centers for Disease Control and Prevention (CDC), a $2.1 billion increase or 24.97% over FY22 levels,
  • $3.55 billion for the Food and Drug Administration (FDA), a $230 million increase or 6.94% over FY22 levels,
  • $10.34 billion for the National Science Foundation (NSF), a $1.5 billion increase or 16.97% over FY22 levels, and
  • $385 million for the Agency for Healthcare Research and Quality (AHRQ), a $35 million increase or 10% over FY22 levels.

Senate appropriators do not plan to mark up the legislation released last week. Given Republican opposition to overall funding levels and the absence of language restricting funding for abortion, Congress is expected to rely on a continuing resolution (CR), i.e., stopgap spending bill, to avoid a government shutdown at the end of the fiscal year on September 30.

Ways and Means Advances Prior Authorization Bill

The House Ways and Means Committee advanced legislation to overhaul the Medicare Advantage (MA) program’s prior authorization process last week. The Improving Seniors’ Timely Access to Care Act (H.R. 8487) would require MA plans to establish an electronic prior authorization process that provides more timely coverage decisions for routinely requested items and services. It also includes measures to require plans to publish prior authorization data and to encourage plans to base prior authorization decisions on consultations with physicians and evidence-based medical guidelines. The committee advanced the legislation by voice vote, teeing it up for a House floor vote in the fall. The original legislation (H.R. 3173) has over 300 cosponsors or 70% of the House. Bill sponsors introduced the new version of the legislation to preserve the ability to go to the floor with H.R. 3173 should they encounter any delays with the marked-up legislation.

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