United States: Capitol Hill Healthcare Update - June 24, 2019

Last Updated: July 4 2019
Article by Christian B. Jones

Below is this week's "Capitol Hill Healthcare Update," which is posted on Mondays when Congress is in session.

McCONNELL WANTS BIPARTISAN DEAL ON DRUG PRICES BY JULY

To schedule time for debate in the Senate on legislation to lower prescription drug prices, Majority Leader Mitch McConnell, R-Ky., wants a bill that's thoroughly bipartisan and ready to go before the end of July.

Although Finance Committee Chairman Chuck Grassley, R-Iowa, and the panel's top Democrat, Sen. Ron Wyden, D-Ore., are continuing discussions over a drug pricing bill, Grassley said last week that he's not overly optimistic on reaching consensus. Grassley said he and Wyden have reached agreement on 85% percent of the bill, but that finding agreement on the remaining 15%, he predicts, would be difficult.

The senators have discussed limiting seniors' out-of-pocket expenses and calling for some changes to Medicare Part B and Part D, but not a wholesale structural overhaul – and not government negotiation of drug prices, which Grassley opposes.

Of the seven Senate Democrats seeking their party's presidential nomination, all are backing government negotiation of drug pricing – a complicating political factor for Senate Democratic leaders, who might be forced to withhold support for any bill that doesn't include government negotiation.

McConnell's July deadline effectively means he's doubtful drug pricing legislation can achieve bipartisan consensus after Labor Day, when the 2020 presidential campaign will be fully engaged. He also wants to keep the fall Senate schedule clear for budget, spending and debt issues, as lawmakers scramble again to avoid a government shutdown and a possible credit crisis.

GRASSLEY OPPOSES TRUMP'S INTERNATIONAL PRICING PLAN FOR PART B

Senate Finance Committee Chairman Chuck Grassley, R-Iowa, last week came out against the Trump administration's signature proposal to lower the cost of physician-administered prescription drugs.

Trump and Health and Human Services Secretary Alex Azar touted the plan last fall that links prices for Medicare Part B drugs to prices paid by consumers in countries where governments set prices. The administration argues that applying an international pricing index would lower prices in the United States. Pharmaceutical manufacturers and some conservative lawmakers have balked, saying it amounts to importing other nations' price controls.

A senior HHS official acknowledged last week that Grassley's comment wasn't helpful but argued it didn't matter because the administration could implement the Part B plan on its own without congressional approval.

Indeed, HHS last week submitted the plan to the White House's Office of Management and Budget for review.

COMMITTEE REJECTS REPEALING MEDICAL DEVICE TAX

The House Ways and Means Committee last week voted to block adding repeal of the medical device tax to a package of $174 billion in tax breaks approved by the panel.

Rep. Jackie Walorski, R-Ind., proposed to repeal the device tax as an amendment to the overall package, which would renew nearly three dozen lapsed or soon-to-expire tax breaks for businesses and individuals as well as expand the scope of refundable tax credits for lower-income workers and families.

The effort to include the device tax was voted down on a party-line vote, 16-22.

Established by the Affordable Care Act and first enacted in 2013, the device tax has been suspended by Congress since 2016. But unless lawmakers act this year, the 2.3% tax will go back into effect in January.

While the committee vote isn't helpful to the device industry's efforts to build momentum to further suspend the tax, the effort isn't likely to be resolved before the end of the year, when Congress is likely to consider a catch-all spending and tax package.

Meanwhile, the Senate Finance Committee last month established task forces to examine sector-specific temporary tax provisions that have expired or are soon scheduled to expire. The task force examining health-sector taxes – led by Sens. Pat Toomey, R-Penn., and Bob Casey, D-Penn. – heard from stakeholders last week on a permanent repeal of the medical device tax.

SENATE PANEL TO VOTE ON LEGISLATION TARGETING 'SURPRISE' BILLING

The Senate HELP Committee is planning to vote Wednesday on bipartisan legislation to address "surprise" medical bills as part of a larger effort to address overall healthcare costs.

The Senate bill – introduced last week by committee Chairman Lamar Alexander, R-Tenn., and ranking Democrat Sen. Patty Murray, D-Wash. – would use the same structure proposed by the House Energy and Commerce Committee. That move could help speed the bill's approval in Congress.

The legislation would require that emergency healthcare charges are counted toward a patient's in-network deductible, and that patients are only required to pay the in-network cost-sharing amount for out-of-network emergency care. It also would ensure patients are held harmless from surprise air ambulance bills – a major source of complaints about surprise medical bills.

The Alexander-Murray legislation also aims to increase transparency around patents for biologics, and clarifies that biological products, including insulin, that will transition next year from the Food and Drug Administration's drugs pathway to the biologics pathway cannot receive new, extended market exclusivities.

SENATE JUDICIARY PLANS VOTES ON BILLS AFFECTING DRUG PATENTS

The Senate Judiciary Committee is scheduled to vote Thursday on a series of bills aimed at lowering prescription drug prices, including one that cracks down on pharmaceutical manufacturers' use of patents to extend exclusivity.

The patent bill, introduced by Sens. John Cornyn, R-Texas, and Richard Blumenthal, D-Conn., would have allowed the Federal Trade Commission (FTC) to sue manufacturers that leverage patents to delay the approval of generic drugs. But Cornyn said last week he's rewriting his bill to drop the FTC provision and instead use existing Food and Drug Administration authorities to crack down on drugmakers that seek to extend exclusivities by making minor changes to drugs.

The committee also is scheduled to vote on bipartisan legislation introduced by Senate Finance Committee Chairman Chuck Grassley, R-Iowa, that would require the FTC to report on recent merger activity of pharmacy benefit managers and the resulting anticompetitive behavior.

The panel will vote on bipartisan legislation introduced by Sen. Tom Cotton, R-Ark., to strengthen the Patent and Trade Office's ability to review patents regardless of sovereign immunity claims. That follows a 2017 decision by drug maker Allergan to transfer a drug's patents to the Saint Regis Mohawk Tribe.

Also scheduled for a vote is legislation by Sen. Amy Klobuchar, D-Minn., that would amend the FDA's citizen petition process.

AUTISM, RESPITE CARE AMONG FOCUS OF HOUSE HEARING

The House Energy and Commerce Health Subcommittee on Tuesday will hold a hearing on reauthorizing federal programs for autism and three other health-related initiatives.

The autism bill, introduced by Rep. Chris Smith, R-N.J., would expand National Institutes of Health research into autism, coordinate surveillance among federal agencies and boost funding to $23 million annually through 2024.

Legislation by Rep. James Langevin, D-R.I., would reauthorize and increase federal funding for the Lifespan Respite Care Act, which provides state grants to support caregivers nationwide who provide care for loved ones with chronic, disabling health conditions. First introduced by former Rep. Mike Ferguson, R-N.J., and enacted in 2006, the law has led to grants in 37 states and the District of Columbia. (Ferguson is now the leader of BakerHostetler's Federal Policy team.)

Legislation introduced by Rep. Pete King, R-N.Y., would authorize more than $23 million annually through 2024 for emergency medical services for children. (The Senate HELP Committee is planning a vote Wednesday on the Senate's version of that bill, which was introduced by Sen. Robert Casey, D-Penn.)

The subcommittee also will consider legislation by Rep. Lucille Roybal-Allard, D-Calif., that would boost funding for newborn screening.

Other healthcare hearings this week include the House Committee on Oversight and Reform subcommittee on national security reviewing U.S. preparedness for biological attacks. The House Committee on Veterans' Affairs subcommittee on health is hosting a hearing Wednesday on barriers to precision medicine.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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