Skip to main content

Federal Health Policy Updates for the Week of February 10, 2020

Duke Government Relations Logo

The Headlines

  1. The president released his budget proposal for FY 2021.
  2. Two House committees considered surprise billing legislation.
  3. The HHS Secretary testified to the Senate Finance Committee about the FY 2021 budget request.
  4. What do you need to know about the 2020 Census?

The Details

1. President's FY 2021 Budget Request
On Monday, the president released his budget request for FY 2021. As in previous years, the Trump Administration proposed slashing funding for programs of importance to academic medicine, including the National Institutes of Health (NIH), the Health Resources and Services Administration (HRSA) Titles VII and VIII health professions and nursing workforce programs, as well as proposing significant cuts to Medicare Graduate Medical Education (GME) funding and other Medicare and Medicaid funding streams. Among many other things, the budget proposal would:

  • cut the NIH by $3 billion (7 percent) below the current funding level;
  • cut the Agency for Healthcare Research and Quality by $82 million (24 percent) below the current funding level;
  • cut Title VII and Title VIII workforce development programs by $484 million (66 percent) below the current funding level;
  • consolidate Medicare GME, Medicaid GME, and Children’s Hospital GME (CHGME) spending into a single, capped block grant program that would be funded out of the Treasury; 
  • eliminate all exceptions to the so-called site neutral payment policy and require all off-campus hospital outpatient departments to be paid under the Physician Fee Schedule, resulting in a cut of $47.24 billion over 10 years, and
  • urge Congress to pass comprehensive legislation to reduce the cost of prescription drugs. While the administration does not endorse a specific piece of legislation, it does support efforts to establish an out-of-pocket maximum and reduce out-of-pocket costs for seniors, as well as lower costs of generic and biosimilar drugs to patients. The budget anticipates legislation that accomplishes these goals would save $135 billion over 10 years.

Congress has historically rejected the proposed budget, which is primarily a messaging document outlining the Administration’s priorities. In an election year, it also provides insight as to what the Trump Administration would propose in a second term and a platform for Democrats to run against. Our office will continue monitoring the budget proposal as more details are released and budget hearings begin on Capitol Hill.   
 
2. Surprise billing mark-ups
On Tuesday, the House Education and Labor Committee marked up H.R. 5800, the Ban Surprise Billing Act, which is similar to a Senate Health, Education, Labor and Pensions Committee and House Energy and Commerce Committee proposal that relies on a federal benchmark payment to settle disputes between insurers and providers. For bills over $750, providers and payers could appeal to an independent arbiter. The legislation would also bar air ambulance services from sending surprise bills while allowing disputed air ambulance costs above $25,000 to be appealed to an independent arbiter. The Committee approved the bill by a vote of 32-13, with Ranking Member Virginia Foxx (R-NC-05) voting no and Rep. Greg Murphy (R-NC-03) voting yes. 

On Wednesday, the House Ways and Means Committee approved by voice vote its version of surprise billing legislation that includes a mediation process for when insurers and out-of-network providers cannot agree on a payment rate. House Democratic leaders must reconcile the competing bills if they hope to bring a compromise to the floor this spring. Surprise billing could be added to legislation reauthorizing several health programs whose funding expires on May 22.

3. Budget hearings begin
On Thursday, Health and Human Services Secretary Alex Azar defended his agency's FY 2021 budget request before the Senate Finance Committee, facing questions about the Trump Administration's proposals to overhaul the Medicaid program and the lawsuit involving the Affordable Care Act. Specifically, several senators posed questions about the Medicaid Fiscal Accountability Regulation, which is a proposed rule that aims to boost the transparency of Medicaid supplemental payments to providers and give the Centers for Medicare and Medicaid Services new authority to regulate how states finance their Medicaid programs. Duke University Health System submitted comments in opposition to the proposed rule.

4. The 2020 Census
Census data are used to redraw legislative boundaries within states; to produce population estimates and projections; and in formulas that help allocate more than $675 billion in federal funds annually to states and localities. Beginning in mid-March, households throughout the country will receive the first mailing from the U.S. Census Bureau with information on how to complete the Census online, by phone, or by mail. Self-response begins March 23. When completing the Census questionnaire, it is important to include all people living in your household on April 1, 2020.  More information is available here.