It costs so little
Yet there’s no greater debt than
Forgiving what’s owed
The Rundown
- Congressional committees take deep dive on hospitals and healthcare policy
- House passes debt limit bill
- CMS to increase price transparency rules enforcement
- The latest from our desks
- Save the date: virtual office hours on May 19
- Join the Duke Health Advocacy Network!
Federal Updates
Heard on the Hill: hospitals and healthcare in sharp focus this week for committee activity
And... exhale. It was quite a week for hospitals and healthcare policy on the Hill as several House subcommittees took aim at issues ranging from price transparency, competition, site-neutrality, and the community benefit standard to data privacy and biomedical research. While there were plenty of frustrating moments, there is also a lot of opportunity to share the current challenges and realities facing our own health system and healthcare workforce, as well as to continue engaging, educating, and establishing Duke Health as a resource to lawmakers as they move beyond the hearing rooms to actual policy development. Here’s a review of the hearings we were following.
House Energy and Commerce Health Subcommittee Hearing on Transparency and Competition
On Wednesday, the House Energy and Commerce Subcommittee on Health held a hearing entitled “Lowering Unaffordable Costs: Legislative Solutions to Increase Transparency and Competition in Health Care.”
The Subcommittee is examining bills of concern to hospitals, including legislation to address site-neutral payment policy that could reduce payments for procedures performed in hospital out-patient departments (HOPDs). The Bipartisan Budget Act of 2015 enacted provisions that mandated that new off-campus HOPDs be reimbursed at the same rate as other outpatient providers but exempted existing off-campus HOPDs. If proposed legislation were enacted, there would no longer be a grandfather clause for off-campus HOPDs that were operating prior to 2015. The Subcommittee also considered site-neutrality recommendations for certain services offered in ambulatory settings based on MedPAC recommendations but would limit Medicare reductions to safety net hospitals to 4.1% annually with discretion provided to the HHS to set a lower amount. Other site-neutral policies were discussed for drug administration and diagnostic tests. Ashley Thompson, Senior Vice President of Public Policy Analysis and Development at the American Hospital Association (AHA), testified and shared AHA’s opposition to site-neutral payment cuts and urged protection of the 340B program. Her testimony can be viewed here.
The Subcommittee is also examining hospital price transparency legislation intended to “codify and improve upon existing price transparency requirements for hospitals,” including additional requirements and policies on penalties. Chiquita Brooks-LaSure, Administrator for the Centers for Medicare and Medicaid Services (CMS), served as the witness for the legislative hearing and noted that CMS is stepping up its hospital price transparency efforts (more information below). She also spoke to efforts underway to increase transparency in private health plans and to make public information available on acquisition and mergers and changes of ownership for hospitals and nursing homes enrolled in Medicare.
Other legislation being examined by the committee includes bills to establish reporting requirements for hospitals participating in the 340B program, repealing the prohibition on physician-owned hospitals, and delaying cuts to the Medicaid Disproportionate Share Hospital (DSH) program.
In her opening statement, full committee chair Rep. Cathy McMorris Rodgers (R-WA) spoke in support of site neutral policies, but also acknowledged the effects of high labor costs, inflation, and ever-increasing government regulation on hospitals.
Although many of these proposals are still in an initial legislative phase, our team has been anticipating and preparing for these conversations. Duke Health opposes several of these provisions, and we are working with Duke Health leadership, the NC congressional delegation, and other partners to help policymakers understand the impact of potential legislative policy changes.
House Ways and Means Oversight Subcommittee Hearing on Tax-Exempt Hospitals and Community Benefit
On Tuesday, the House Ways and Means Subcommittee on Oversight held a hearing entitled, “Tax-Exempt Hospitals and the Community Benefit Standard.” Witnesses included a representative from the Government Accountability Office, an economist, a representative from the Kaiser Family Foundation, and Melinda Reid (Mindy) Hatton, General Counsel and Secretary of the American Hospital Association (AHA). The conversation largely focused on whether the Internal Revenue Service’s (IRS) community benefit standard, a test used by the IRS to determine whether a hospital is organized and operated for the charitable purpose of promoting health, should be updated or further defined with brighter line criteria. Some Subcommittee members also took opportunities to mention other issues related to tax-exempt hospital operations, including the 340B drug program and executive compensation.
In her testimony, AHA’s Mindy Hatton made the case that tax-exempt hospitals both meet and exceed any requirements and expectations that attach to the privilege of tax exemption. She noted that in 2019, the most recent tax year that comprehensive information is available, tax-exempt hospitals devoted nearly 14% of their total expenses to community benefit programs. She further cited a report by international accounting firm EY that demonstrated that the monetary return to taxpayers for hospitals’ federal tax exemption is 9-to-1.
As congressional committees continue to evaluate the nation’s public health emergency response and respond to reports suggesting potential enrichment of certain entities because of pandemic investments, further examination of tax-exempt entities, including the operations of nonprofit hospitals, is anticipated.
House Energy and Commerce Subcommittee on Innovation, Data, and Commerce Hearing on “Addressing America’s Data Privacy Shortfalls”
On Thursday, the House Energy and Commerce Subcommittee on Innovation, Data, and Commerce held a hearing entitled, “Addressing America’s Data Privacy Shortfalls.” Witnesses included representatives of technology trade associations and industry and the discussion focused on efforts to enhance Americans’ privacy and data security protections, as well as the safety of online applications. In addition to conversations about protecting sensitive personal financial data, several committee members mentioned the responsibilities of non-HIPAA covered third parties to better safeguard the transmission and exposure of personal health information, questioning whether HIPAA might expand its coverage definition to include these entities and what role the Federal Trade Commission (FTC) should play in oversight.
The hearing is a continuation of committee conversations on the need to develop comprehensive data privacy legislation in follow up to a bipartisan bill, the "American Data Privacy and Protection Act", that passed the full Energy and Commerce Committee in the last Congress.
House Energy and Commerce Committee Subcommittee on Oversight and Investigations Hearing on Biosafety and Risky Research
This week, the House Energy and Commerce Subcommittee on Oversight and Investigations continued its examination of COVID-19 and the pathogen’s origin with a hearing entitled, “Biosafety and Risky Research: Examining if Science is Outpacing Policy and Safety.” The conversation focused on safety and regulations on “potential pandemic pathogens,” including oversight of high-containment laboratories, as well as the whether the U.S. needs a single entity responsible for oversight of research involving potential pandemic pathogens for better domestic and global response and coordination.
In anticipation of the hearing, full Committee Chair Cathy McMorris Rodgers (R-WA) and Chair of the Subcommittee Morgan Griffith (R-VA) released the following statement: “Our Committee’s ongoing work has ignited heightened concerns about how we conduct and fund risky research and whether current biosafety measures are still sufficient to mitigate risks. As scientists, government investigators, and journalists continue to uncover more information, it is important to have public discussion and debates to ensure our policies and practices evolve to protect the safety of the American people and the world. This hearing will provide members and the public an opportunity to better understand specific risks involved with gain-of-function research on potential pandemic pathogens, current biosafety practices at high-containment laboratories, and will help better inform upcoming policymaking decisions.”
Next Up – Hearing today on antimicrobial resistance
Today, the House Energy and Commerce Subcommittee on Oversight and Investigations will hold a hearing entitled, “Antimicrobial Resistance: Examining an Emerging Public Health Threat.” Anticipated witnesses for the hearing include representatives from the Infectious Diseases Society of America; CARB-X at Boston University; U.S. Government Accountability Office; and University of Virginia School of Medicine.
A long way from somewhere: House debt limit bill aims to spur negotiations
It took a little longer than planned, and some last-minute changes and wrangling, but House Speaker Kevin McCarthy (R-CA) was able to pull together just enough votes on Wednesday to pass his debt limit legislation by the narrowest of margins. Slightly modified from its original version, the “Limit, Save, Grow Act” (H.R. 2) would combine $4.8 trillion in spending and policy cuts, including deep cuts to non-defense discretionary funding for key healthcare priorities and biomedical research and changes to safety net programs, with a $1.5 trillion debt limit increase for up to one year. The legislation has no chance of passage with a Democratic majority in the Senate, but that was never the point of the initial exercise.
The dividing lines between the White House and congressional Democrats and the House Republican majority have never been in question. There is no disagreement that the country defaulting on its financial obligations could be catastrophic, but there is also no consensus on how to prevent that from happening. President Biden has called for a “clean” debt limit increase with a separate conversation on fiscal reform. House Republican leaders want serious spending concessions in exchange for a debt limit vote – and now they have a public marker to try to use as leverage in negotiations. The problem? There is no negotiating table, yet – and time is running short, maybe even as soon as the next 6-8 weeks, to figure out a path forward.
What does it mean for Duke Health? For now, it’s all about how the board is being set up. The House Appropriations Committee is expected to begin its work on its versions of the 12 annual appropriations bills in the next few weeks. There are indications that the debt limit bill may serve as a spending baseline, which means it’s possible that most House-recommended funding levels for key priorities could come in lower than current spending levels. While the House’s work is not necessarily determinative, it will almost certainly add more uncertainty and instability to the process, as well as the immediate futures of federally supported initiatives, grants, and projects. What happens next is dependent on how and when the administration and Senate Democrats choose to engage. We used to regularly bemoan the days of constant continuing resolutions (CR) to maintain level funding, but absent careful strategy, another CR and a debt limit vote might be a near-term best-case scenario.
Our team is continuing to work with Duke Health leadership and the NC congressional delegation to emphasize the critical importance of federal support for health systems, the healthcare workforce, research and our communities.
CMS to increase price transparency enforcement
While testifying before the House Energy and Commerce Health Subcommittee on Wednesday, Centers for Medicare and Medicaid Services (CMS) Administrator Chiquita Brooks-LaSure unveiled plans to strengthen CMS’s hospital price transparency enforcement activities. These increased efforts include giving hospitals no more than 45 days to put a corrective action plan (CAP) in place, imposing civil monetary penalties earlier and automatically in certain cases, and removing warning notices for hospitals that haven’t attempted to comply with price transparency requirements.
In an updated fact sheet released this week, CMS noted that in addition to the 45-day maximum for hospitals to submit a CAP, the updated enforcement plan will also now require hospitals to be in full compliance within 90 days of the initial CAP request. CMS will also automatically impose a civil monetary penalty on hospitals that don’t submit a CAP at the end of the 45-day submission deadline after a final compliance review.
Administrator Brooks-LaSure also told the Subcommittee during her testimony that the agency would welcome more authority from Congress around hospital price transparency requirements, a request that comes at a time when congressional leaders are separately proposing greater enforcement authority for CMS and other federal entities on price transparency and competitiveness.
From our desk(s): Duke Health GR this week
This week, our team coordinated a meeting for Duke University School of Nursing Dean Vincent Guilamo-Ramos with the office of Rep. Don Davis (D-NC-01) to discuss his recent op-ed in The Hill, and to inform public health topics on a range of issue relating to a range of public health issues including STO prevention and treatment.
We coordinated with Duke Health experts and leadership to issue a Duke Health response to a request for information from a member of the House Energy and Commerce Committee on recommendations to reform and strengthen the Centers for Disease Control and Prevention (CDC).
We worked with the offices of Senator Richard Durbin (D-IL) and Shelly Moore Capito (R-WV) in the development of legislative language to reauthorize the National Child Traumatic Stress Network (NCTSN), which is coordinated by the Duke-UCLA National Center for Child Traumatic Stress (NCCTS).
Finally, members of our team engaged with congressional staff in advance of the key committee hearings and on other issues, including telehealth, immigration and the international workforce, healthcare supply chain, nursing, and academic medicine.
Save the Date – Virtual “Office Hours” on May 19
Duke Health (federal) Government Relations is once again partnering with our Duke State Relations colleagues to hold our second open, virtual "office hours" in May. Open to members of the Duke Health Advocacy Network, these “office hours” are not formal presentations but instead an opportunity to talk about some of things on deck for us to learn more about the issues that are at the forefront for you and your work. Our sincere thanks to those who joined us for our inaugural office hours on April 21st. We hope to see you again in May!
Date: Friday, May 19, 2023
Time: 10:00 a.m.
A link to access the event will be published in the Duke Health Advocacy Network Teams Channel
Not yet a member of the Duke Health Advocacy Network? No problem! Learn more about how to join below.
Join the Duke Health Advocacy Network!
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