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Federal Health Policy Updates for the Week of September 16, 2019

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The Headlines

  1. The House approved a short-term continuing resolution to fund the federal government before the new fiscal year begins October 1.
  2. The Senate released an FY 2020 spending bill that would fund public health and medical research, among other priorities for Duke Health.
  3. House Democratic leaders introduced legislation to reduce prescription drug costs.
  4. A federal judge ruled in favor of hospitals on payments for hospital outpatient services.
  5. Legislation has been introduced to address the public charge rule.
  6. The 2019 Rally for Medical Research Hill Day was held in Washington, DC, to support robust, sustainable, and predictable funding for the National Institutes of Health (NIH).

The Details

1. House approved a short-term funding bill
The new federal fiscal year begins October 1, and Congress has not enacted any FY 2020 spending bills over partisan disagreements regarding border wall funding, abortion policy, and overall spending levels for non-defense programs. In an effort to buy more time and use Thanksgiving as a deadline to act, the House passed a continuing resolution that would fund the government at current levels through November 21. The Senate will take it up this week, and the president is expected to sign.

2. Senate draft spending bill released
On September 18, the Senate Appropriations Committee released its version of the FY 2020 Labor-HHS-Education spending bill that proposes an increase of $3 billion for NIH, which would mark a 40 percent increase over the past five years. The draft bill also would provide an increase of $70 million to respond to the opioid epidemic while expanding mental health research and treatment; a $350 million year-to-year increase for Alzheimer's research; and a $210.8 million increase for cancer research. More information is available here.

3. Prescription drug cost legislation
On September 19, House Democratic leaders introduced H.R. 3, the Lower Prescription Drug Costs Now Act, which aims to lower prices the government and patients pay for prescription drugs. Under the plan, Medicare would negotiate directly with drug companies for prices on at least 25 – and up to 250 – brand-name prescription drugs. To be eligible for negotiation, the drugs must also lack generic or biosimilar competition.

In addition, the upper limit Medicare pays for drugs would be no more than 1.2 times the average price in six countries (Australia, Canada, France, Germany, Japan and the United Kingdom); savings from the lower-priced drugs would be directed to NIH to develop new medicines and toward improvements in Medicare; drug companies would face penalties if they failed to offer the negotiated price to commercial insurers and employers; and seniors' annual out-of-pocket spending in the Medicare Part D prescription drug benefit would be capped at $2,000.

The plan is dead on arrival in the Republican-held Senate but could force the president to maintain his support for similar proposals he has previously endorsed. The House Energy and Commerce Committee will hold a hearing on September 25 to discuss this and related legislation with the goal of finalizing legislation by the end of the year.
 
4. Hospital outpatient services payment
A federal judge ruled last week that HHS exceeded its statutory authority when it cut payments for clinical services at off-campus provider-based clinics. CMS finalized the policy in last year’s hospital outpatient rule, and it went into effect on January 1, 2019 to be phased in over two years. The judge did not grant hospitals’ request for a court order requiring CMS to issue the payments they believe were improperly withheld. Instead, she required joint status reports by October 1 to decide if additional briefings on a remedy are needed.

5. Legislation on the public charge rule
In August, the Department of Homeland Security released a final rule that establishes new standards about which public benefits will be considered when immigrants who are legally in the United States seek to change their immigration status, including Medicaid and public housing and nutrition programs. Senator Mazie Hirono (D-Hawaii) and 26 other Democrats introduced legislation last week to block the use of federal funds and resources to administer and implement the new rule that goes into effect on October 15. Nearly 100 House members have cosponsored companion legislation to block the rule, but it's a non-starter in the Senate.
 
6. Rally for Medical Research Hill Day
On September 19, the seventh annual Rally for Medical Research Hill Day was held in Washington, DC to support robust, sustainable, and predictable funding for the National Institutes of Health. Duke Health joined representatives from UNC Health Care and the UNC-CH School of Public Health in meetings on Capitol Hill with the North Carolina congressional offices of Senator Richard Burr, Senator Thom Tillis, Rep. GK Butterfield, Rep. David Price, Rep. Richard Hudson, and Rep. George Holding to raise awareness about the importance of continued investment in medical research.

Upcoming hearings