SCOTUS Watch

The Supreme Court is expected to issue its opinion in King v. Burwell by the end of the month, though it is unclear when the decision will be handed down. Currently, the Supreme Court has scheduled non-argument days for June 22 and 29, with a conference day scheduled for June 25. The issue in King is whether the Affordable Care Act (ACA) provides tax subsidies to individuals who purchase insurance through the federal exchange, in addition to subsidies for those who buy insurance through state-based exchanges, which is explicitly stated in the law.

Legislative Activity

House to Continue Consideration of IPAB Repeal

Majority Leader Kevin McCarthy (R-CA) has announced that the House of Representatives will complete consideration of H.R. 1190, the Protecting Seniors’ Access to Medicare Act of 2015, this week. This bill repeals the sections of the ACA that establish the Independent Payment Advisory Board (IPAB), an entity to develop proposals to reduce spending growth in the Medicare program. The Congressional Budget Office (CBO) has estimated that the repeal would cost $7.1 billion from FY 2016 to FY 2025. The House Committee on Rules adopted an amendment, offered by Rep. Joe Pitts (R-PA), which offsets the repeal costs with funds from the ACA’s prevention and public health fund. The House began considering the bill last week but a vote was postponed. It currently has 235 bipartisan cosponsors.

Appropriations Committees Mark Up Health Legislation

Following Subcommittee action last week, the House Committee on Appropriations has announced it will hold a markup of the FY 2016 Labor, Health and Human Services, and Education bill on Wednesday, June 24. The draft legislation includes $153 billion in discretionary funding ($14.6 billion below the President’s budget request), with $71.3 billion for the Department of Health and Human Services (HHS) ($3.9 billion below the President’s budget request). The bill includes over $6 billion in funds for the Health Resources and Services Administration (HRSA) ($413 million below the President’s budget request), including $265 million for the Children’s Hospital Graduate Medical Education Program. Additionally, the bill provides the Centers for Disease Control and Prevention (CDC) $7 billion (equal to the President’s budget request), including $1.56 billion for Public Health Preparedness and Response; $31.2 billion for the National Institutes of Health (NIH) to increase several research initiatives ($100 million above the President’s budget request); and $3.3 billion for the Centers for Medicare and Medicaid Services (CMS) ($919 million below the President’s budget request). The bill does not include additional funding to implement the ACA. It prohibits funds from going to the “Center for Consumer Information and Insurance Oversight” and “Navigators” programs.

The Senate Committee on Appropriations Subcommittee on Departments of Labor, Health and Human Services, Education, and Related Agencies will hold a markup on its appropriations language on Tuesday, June 23. The legislation has yet to be released.

Chairman Upton Expected To Release Manager’s Amendment for 21st Century Cures Act

After announcing that the House floor will not consider the 21st Century Cures Act this month, Committee on Energy and Commerce Chairman Fred Upton (R-MI) stated that he plans to file a manager’s amendment for the bill this coming week. Lawmakers have been in discussions over the bill’s offsets, which have remained controversial since the Committee advanced the legislation last month. Offsets currently include delaying certain Medicare Part D plan prepayments, drawing down the Strategic Petroleum Reserve, limiting federal Medicaid reimbursement to states for durable medical equipment to Medicare payment rates, and limiting federal payment for X-ray imaging services that use film.  America’s Health Insurance Plans (AHIP) has come out against the Medicare Part D offset, which is expected to lower Medicare spending by about $5 billion to $7 billion. The Advanced Medical Technology Association (AdvaMed) has expressed concerns on the durable medical equipment offset, which is expected to save $2.8 billion.

Chairman Upton expects the Committee on Ways and Means to waive jurisdiction and agree to his manager’s amendment. He predicted a floor vote would occur in early July.

Stakeholder Comments Due for Senate Finance Committee’s Chronic Care Working Group

In May, the Senate Committee on Finance Chairman Orrin Hatch (R-UT) and Ranking Member Ron Wyden (D-OR) announced the formation of a chronic care working group, to be co-chaired by Sens. Johnny Isakson (R-GA) and Mark Warner (D-VA). The committee’s working group has requested stakeholder input on strategies to improve outcomes for Medicare patients with chronic conditions, including the use of telehealth and remote monitoring technology. The deadline to respond to the committee’s working group is this Monday, June 22.

This Week’s Hearings:

  • Tuesday, June 23: The Senate Committee on Appropriations Subcommittee on Departments of Labor, Health and Human Services, Education, and Related Agencies will hold a markup on the Labor, Health and Human Services, Education, and Related Agencies Appropriations Act, 2016.
  • Wednesday, June 24: The House Committee on Ways and Means Subcommittee on Oversight will hold a hearing titled “Rising Health Insurance Premiums Under Obamacare.”
  • Wednesday, June 24: The House Committee on Energy and Commerce Subcommittee on Health will hold a hearing titled “Examining the Administration’s Approval of Medicaid Demonstration Projects.”
  • Wednesday, June 24: The House Committee on Appropriations will hold a markup on the FY 2016 Labor, Health and Human Services, and Education bill.
  • Wednesday, June 24: The Senate Committee on Veterans’ Affairs will hold a hearing titled “Pending Health Care and Benefits Legislation.”
  • Thursday, June 25: The House Committee on Energy and Commerce Subcommittee on Health will hold a hearing titled “Examining Public Health Legislation: H.R. 2820, H.R. 1344, and H.R. 1462.” H.R. 2820, the Stem Cell Therapeutic and Research Reauthorization Act, provides federal support for cord blood donation and research so as to increase patient access to transplant. H.R. 1344, the Early Hearing Detection and Intervention Act of 2015, reauthorizes a program for early detection, diagnosis, and treatment regarding deaf and hard-of-hearing newborns, infants, and young children. H.R. 1462, the Protecting Our Infants Act of 2015, develops recommendations and improves prevention, treatment, and data on prenatal opioid abuse and neonatal abstinence syndrome.

Regulatory Activity

HRSA Unveils 340B Proposed Rule

On Wednesday, June 17, HRSA published a notice of proposed rulemaking titled “340B Drug Pricing Program Ceiling Price and Manufacturer Civil Monetary Penalties.” The 340B drug pricing program is designed to permit covered entities “to stretch scarce federal resources as far as possible, reaching more eligible patients and providing more comprehensive services.” Participating drug manufacturers are not permitted to charge covered entities prices that exceed the defined 340B ceiling prices for covered outpatient drugs.

The ACA amended the 340B regulations to require the development and publishing of “precisely defined standards and methodology for the calculation of ceiling prices” and to allow for the imposition of civil monetary penalties to non-compliant manufacturers. This rule proposes a procedure for calculating the 340B drug ceiling price and for estimating the ceiling price for new covered outpatient drugs. Additionally, this rule would define the instances of overcharging, which would result in the imposition of civil monetary penalties to non-compliant manufacturers.

The deadline for comments is August 17, 2015.

Other Activity

MedPAC and MACPAC Release June Reports to Congress

On Monday, June 15, the Medicare Payment and Advisory Commission (MedPAC) released its June report to Congress titled “Medicare and the Health Care Delivery System.” MedPAC is an independent congressional agency that is charged with advising Congress on the Medicare program. Each March and June, the Commission issues reports to Congress. Of note, this report outlines a package of recommendations to address hospital short-stay policy issues, which includes withdrawing the Centers for Medicare and Medicaid Services’ (CMS) two-midnight rule.

On the same day, the Medicaid and Children’s Health Insurance Program (CHIP) Payment and Access Commission (MACPAC) released its biannual mandated “Report to Congress on Medicaid and CHIP.” Similar to MedPAC, MACPAC is a non-partisan legislative agency that is charged with providing policy and data analysis, and making recommendations to Congress on issues affecting Medicaid and CHIP. Among other issues, this report addresses: Medicaid coverage of dental benefits for adults; the intersection of Medicaid and child welfare; behavioral health in the Medicaid program; and the use of psychotropic medications among Medicaid beneficiaries.

CBO Issues 2015 Long-Term Budget Outlook

On Tuesday, June 16, CBO released the “2015 Long-Term Budget Outlook,” which projects the long-term outlook for the federal budget over the next decade and through 2040. This report addresses the outlook for federal health care programs, including Medicare, Medicaid, and CHIP. CBO predicts that if current laws remain unchanged, an aging population, rising health care costs, and increased spending attributable to the ACA would drive up spending for large federal programs, and will continue to rise substantially relative to gross domestic product.

CBO Predicts Effects of Repealing the ACA

On Friday, June 19, the CBO published the “Budgetary and Economic Effects of Repealing the Affordable Care Act.” In this report, the CBO and the Joint Committee on Taxation project the budgetary and economic consequences of repealing the ACA over the next ten years and beyond. This report projects that, excluding the effects of macroeconomic feedback, ACA repeal would increase federal budget deficits by $353 billion over the period of 2016 to 2025.

CBO’s projection comes as the Supreme Court is expected to issue a decision in King v. Burwell.