Below is this week’s “Capitol Hill Healthcare Update,” which is posted on Mondays when Congress is in session. Highlights this week: Healthcare legislative priorities are caught up in a separate spending debate that could lead to a partial government shutdown; some GOP lawmakers push back on Trump’s Part B pilot program; a key Democrat says he wants Medicare to negotiate prescription drug prices; a key senator wants to know what the FDA is doing on medical device cybersecurity; and more.

YEAR-END HEALTH PRIORITIES FROZEN AMID LAME DUCK BUDGET STALEMATE

Congress and the White House may have a two-week reprieve from Friday’s deadline to avert a partial government shutdown, but the fate of key healthcare initiatives remains in flux amid a partisan fight over funding levels for a border wall with Mexico.

President Donald Trump and Congress are expected to approve a two-week delay in Friday’s budget deadline, in part because of the death of former President George H.W. Bush, who will lie in state at the Capitol this week. Trump also ordered federal offices closed Wednesday in Bush’s honor.

Caught up in the budget brinksmanship are efforts to push back the Affordable Care Act’s medical device tax, health insurers’ tax and implementation of the tax on high-cost “Cadillac” health plans. Also stalled is an effort by pharmaceutical manufacturers to lower their mandated discounts for brand-name drugs in the Medicare Part D donut hole.

The budget impasse is affecting legislation that would coordinate care for children with complex medical needs and a bill that would help move people with disabilities out of nursing homes. Lawmakers are scrambling to find offsets for those two Medicaid bills, but the budget overhang isn’t aiding those discussions.

Most federal healthcare operations – including at HHS, CMS and other agencies – would be unaffected by a partial shutdown. Congress approved yearlong appropriations for those functions earlier this year. But the FDA, which is funded through the agriculture spending bill that has not yet passed Congress, could see nonessential functions close in the event of a shutdown.

In an effort to break the budget logjam, Trump is meeting Tuesday with incoming House Speaker Nancy Pelosi, D-Calif., and Senate Democrat Leader Chuck Schumer, D-N.Y. Congressional Republicans won’t be in attendance. Even if the budget impasse is resolved, it’s not clear that there’s an appetite on Capitol Hill to address the healthcare issues as lawmakers – including those who were defeated in last month’s midterm elections – appear eager to race for the door as the 115th Congress ends.

GOP LAWMAKERS QUESTION AZAR, VERMA OVER PART B PROPOSAL

Former physicians now serving as Republican lawmakers questioned Trump administration health officials last week over a proposal to link Medicare reimbursements for drugs administered in doctors’ offices with an international pricing index based on countries whose governments set drug costs.

Reps. Phil Roe, R-Tenn., and Larry Bucshon, R-Ind., were among the GOP lawmakers who questioned HHS Secretary Alex Azar and CMS Administrator Seema Verma. Roe and Bucshon are members of the GOP Doctors Caucus, which is comprised of lawmakers who previously worked as physicians.

Bucshon, a former heart surgeon, has been critical of the administration’s plan, which he called government price controls. Roe, a former obstetrician-gynecologist and the current co-chairman of the caucus, has made similar comments.

Last week, Senate Finance Committee Chairman Orrin Hatch, R-Utah, Senate Judiciary Committee Chairman Chuck Grassley, R-Iowa, and Sen. Thom Tillis, R-N.C., also expressed varying degrees of concern with the plan. Senate HELP Committee Chairman Lamar Alexander, R-Tenn., and Sen. Bill Cassidy, R-La., have publicly backed the Part B proposal.

The Trump pilot program, which the administration hopes to finalize through regulations next year, earned lukewarm praise from congressional Democrats, most of whom said it didn’t go far enough to reduce prescription drug prices.

Some Republican lawmakers are also beginning to question the administration over its plan to roll back the federal requirement that Medicare Part D insurance plans cover all drugs in the so-called six protected therapeutic classes, including drugs used in mental health treatment and cancer. That plan, which the administration says would reduce Part D premiums, is likely to trigger a firestorm of opposition on the Hill next year among patient advocacy groups.

SENATE PANEL OKs BIPARTISAN HEALTH BILLS

In its final act of the lame duck session, the Senate HELP Committee last week approved several bipartisan healthcare bills, including reauthorizing federal programs covering brain injuries and Alzheimer’s disease.

The committee voted to reauthorize a federal traumatic brain injury program that funds grants related to surveillance, prevention, care and research. The panel renewed a program that supports state activities related to Alzheimer’s disease, cognitive decline and brain health.

The committee also renewed the Emergency Medical Services for Children Program and the placement of maternal health professionals.

Separately, the House last week approved to two health-related bills by voice vote: strengthening federal healthcare fraud prevention and expanding federal dental health programs.

SANDERS COPIES TRUMP MECHANISM IN BILL TO MANDATE LOWER DRUG COSTS

Sen. Bernie Sanders, I-Vt., is taking a page from President Donald Trump by copying an HHS provision announced in October that would tie Medicare costs for prescription drugs to prices paid by consumers in countries where costs are fixed by government price controls.

But Sanders and Rep. Ro Khanna, D-Calif. – who will introduce companion bills in January – would go even further. Under their bill, if pharmaceutical manufacturers refused to lower prices below the median costs in other countries, the federal government could invalidate the drug’s patent and approve the immediate manufacturing of a generic version.

Sen. Jeff Merkley, D-Ore., last week also introduced legislation modeled on Trump’s plan. Merkley’s bill would require drug companies, as a condition of participating in Medicare and Medicaid, to set prices below the median price paid in 11 countries in Europe and Asia.

BIPARTISAN SENATE PUSH TO EXTEND TAX SUSPENSION ON INSURERS

Led by Senate Republican Conference Chairman John Barrasso, R-Wyo., a group of bipartisan senators is urging congressional leaders to extend the moratorium on the Affordable Care Act’s health insurance tax.

Congress previously suspended the tax for 2019, but it’s scheduled to come back online in 2020. The senators said extending the suspension would help lower health insurance premiums.

Sens. Doug Jones, D-Ala., Cory Gardner, R-Colo., and Jeanne Shaheen, D-N.H., signed the letter with Barrasso.

GRASSLEY QUESTIONS FDA ON MEDICAL DEVICE CYBERSECURITY

The incoming Senate Finance Committee chairman wants answers from the FDA on how it’s addressing cybersecurity in medical devices after an inspector general report identified shortcomings at the agency.

In a letter to Commissioner Scott Gottlieb, Sen. Charles Grassley, R-Iowa, wrote that foregn governments could leverage hacks into medical devices not only to harm patients but also to steal medical information. He asked Gottlieb to disclose whether the FDA has identified state actors as threats to medical device cybersecurity.

Grassley is the current Judiciary Committee chairman. He will be leaving that post in January to take over the Finance Committee following the retirement of Sen. Orrin Hatch, R-Utah.

BIPARTISAN BOOST FOR TRUMP PLAN DISCLOSING DRUG PRICES IN ADS

The Trump administration’s controversial plan to require pharmaceutical manufacturers to include drugs’ list prices in consumer advertising picked up bipartisan support in the Senate last week.

Judiciary Committee Chairman Chuck Grassley, R-Iowa, and Democratic Whip Dick Durbin, D-Ill., said HHS Secretary Alex Azar should quickly implement the proposal. The senators also called on the Government Accountability Office to examine the impact of the industry’s consumer advertising on Medicare and Medicaid spending.

“Requiring price disclosure when pharmaceutical companies choose to advertise their medications directly to consumers is a bipartisan, commonsense strategy to boost competition and help Americans struggling with outrageously high and skyrocketing drug costs,” the senators wrote to Azar. “It is well-past time for drug manufacturers to level with the American public.”

The Senate in August approved a Grassley-Durbin proposal calling on HHS to develop regulations requiring manufacturers to include pricing information in their ads. That provision was not included in the final HHS appropriations bill.

The trade associations PhRMA and BIO opposed the proposal, saying consumers have different costs for out-of-pocket expenses depending on their insurance plans. List prices for prescription drugs vary depending on discounts, rebates and negotiations by insurers, according to the trade groups, which also raised First Amendment concerns.

PALLONE CONFIRMS MEDICARE DRUG NEGOTIATION WILL BE PRIORITY

The incoming chairman of the House Energy and Commerce Committee confirmed last week that one of his top healthcare priorities in 2019 will be passing legislation allowing Medicare to negotiate prescription drug prices directly with pharmaceutical manufacturers.

“I’ve always been an advocate for negotiated prices under Medicare, and as you know, President Trump says that he’s for that, so I think that’s an area where we can get agreement with the president,” Rep. Frank Pallone, D-N.J., told reporters on Capitol Hill.

The 2003 law that created the Medicare Part D program includes so-called noninterference language that expressly prohibits Medicare from negotiating prices with drug companies. Republicans who mostly backed the law say overturning the noninterference prohibition is unnecessary because the existing robust competition among Part D insurers drives down drug costs and patients’ out-of-pocket expenses.