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December 21, 2015

Washington Health Policy Week in Review Archive 11f2e446-5f6c-4d7e-81db-b9ba77163234

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Obama Touts 6 Million Health Law Sign-Ups

By Melissa Attias, CQ Roll Call

December 18, 2015 -- President Barack Obama said Friday that 6 million people signed up for health coverage through the federal exchange website during the health law’s third open enrollment period—the same day Congress cleared a government funding and tax package that suspends three taxes in his signature legislative achievement.

"New customers are up one-third over last year, and the more who sign up, the stronger the system becomes," Obama said at his year-end press conference. “That's good news for every American who no longer has to worry about being just one illness or accident away from financial hardship.”

Thursday was the last day for individuals in the 38 states that use to sign up for coverage that begins Jan. 1, after federal officials extended the deadline by two days in a response to a surge in demand. Open enrollment under the Affordable Care Act began Nov. 1 and ends on Jan. 31, 2016.

Obama is expected to sign the package (HR 2029) the Senate cleared Friday that funds the federal government for fiscal 2016 and addresses a number of tax policies, despite provisions taking aim at the health law. The legislation includes temporary suspensions of three taxes that helped offset the cost of the law’s coverage expansion: a pause for the 2.3 percent tax on medical devices from 2016 to 2017, a two-year delay of the "Cadillac" tax on high-cost employer health plans until 2020 and a one-year suspension of the tax on insurers in 2017.

Both the Cadillac tax delay and the health insurance tax pause topped the list of provisions that Democrats claimed as wins in a fact sheet circulated by House Minority Leader Nancy Pelosi of California. Meanwhile, House Majority Leader Kevin McCarthy, R-Calif., highlighted suspensions of all three taxes in a Thursday press release entitled "The House is Dismantling Obamacare."

Officials from the Centers for Medicare and Medicaid Services (CMS) characterized the sign up numbers as evidence of the vibrancy of the marketplace on a call with reporters before Obama spoke. Acting Administrator Andy Slavitt said the 6 million figure compares to about 3.4 million people last year who signed up for coverage that began Jan. 1. The number of sign-ups may be higher than the number who end up paying for coverage and getting covered.

About 2.4 million of the 6 million sign-ups were new customers, Slavitt said, while about 3.6 million people returned to the exchange to actively re-enroll. That figure excludes individuals who will be automatically renewed in coverage and those who signed up for coverage through the state-run exchanges.

On Monday and Tuesday, Slavitt reported that the call center took more than 2 million calls and more than 3.7 million people visited He said 11 consumers were signing up every second for many hours on Tuesday, which he called the busiest day in history with about 600,000 sign-ups.

With such high traffic, Slavitt said the federal website had an average two-minute wait time during the busiest parts of the day on Monday and Tuesday, with no lag on Wednesday or Thursday. Kevin Counihan, CEO of the health insurance marketplace at CMS, also said the call center would have needed 72,000 customer service representatives to handle the demand within the normal answering speed goal.

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Odds for Targeted Medicare Tweaks Appear Tougher After Omnibus

By Kerry Young, CQ Roll Call

December 17, 2015 -- The odds grew tougher this week for groups seeking to make quick and targeted changes in federal health payment rules, including modifications to a new policy regarding hospital outpatient services.

The fiscal 2016 omnibus (HR 2029) emerged after weeks of negotiations relatively free of both controversial riders and the kind of add-on provisions that Congress can use to tweak the complex Centers for Medicare and Medicaid Services (CMS) regulations through larger bills. 

Republicans and Democrats scuttled bids to fight through the $1.15 trillion spending package over topics such as abortion and research on gun violence. Also pushed aside were many calls from medical groups, both in and outside of Congress, for changes to CMS rules and policies.

Looking at the legislative landscape for next year, there may be few significant bills moving that could carry these kinds of add-on CMS provisions, said Elizabeth Carpenter, a vice president at the consulting firm Avalere Health. Enactment of an overhaul (PL 114-10) of Medicare's physician payments this year ended a long cycle in which slated cuts in Medicare reimbursement for doctors had triggered routine action in Congress. But, repeated "doc fix' bills had provided handy vehicles for smaller changes to CMS policy, she said. At the same time, the looming 2016 election will disrupt legislation, with members distracted by election work.

"It's interesting to think about what will Republicans make priorities in an election year, and what could be natural vehicles for health care items," Carpenter said. 

In the Senate, Health, Education, Labor and Pensions Chairman Lamar Alexander, R-Tenn., is working on a biomedical research bill that could be a companion to the House's so-called 21st Century Cures package and change Food and Drug Administration policy to help speed the introduction of new medicines. In the House, Ways and Means Chairman Kevin Brady, R-Texas, has said he would like to proceed with an overhaul of hospital payments. It's unclear yet how far these efforts will go, and whether any other major authorizing measures will emerge that could carry with them relatively small changes to Medicare payment policies, Carpenter said.

Congress has in recent years had a poor record for handling appropriations during election years, leading to a reliance of stopgap spending packages. The nature of the must-pass appropriations bills has raised a high bar on ride-along provisions and shut off another avenue for changing CMS policy.

Still, groups such as the Federation of American Hospitals (FAH) will be on the hunt for legislative vehicles. A priority for the FAH is changing the terms of a congressional plan to meant to end to curtail hospitals' acquisitions of private medical practices, said Jeff Cohen, chief lobbyist for FAH, which represents chains including Tenet, HCA, and HealthSouth. A strong effort to include this in the omnibus fell short.

"We found there was a tremendous amount of support from both Democrats and Republicans in the House and Senate," Cohen said. "We are going to continue to work with our friends on Capitol Hill."

Lawmakers surprised observers by using planned savings from a provision affecting hospital outpatient department payments as an offset in the October budget deal (PL 114-74). The Medicare Payment Advisory Commission (MedPAC) for some time, though, has been raising the discrepancy in payments for identical services when provided in a hospital outpatient department, as opposed to a private practice. An echocardiogram done in an independent doctor's office, for example, might cost $188, while the charges for one done in a hospital-affiliated doctor's office could be $452.89, MedPAC said in one report.

The Congressional Budget Office has estimated that as much as $9.3 billion may be saved over a decade through the provision in the debt deal that limits higher Medicare hospital outpatient payments largely to the existing network of off-campus department. What FAH is seeking to broaden the terms for outpatient departments that can continue to collect this higher payments to include those where expansion plans were well developed with the budget deal took effect.

Another issue that may continue into next year is the push for an easier path to exemption from penalties for missing a federal electronic health records deadline.

CMS now can provide this relief on a case-by-case basis, said Bob Doherty, the senior vice president for government affairs and public policy at the American College of Physicians. There had been an effort as well to get broader relief for doctors and hospitals through the omnibus.

"The fix that we were hoping that we would get in the legislation would have provided a blanket exemption for physicians" who missed the deadline due to a delay with the finalization of regulations, he said.

A blanket exemption provision was included in a small package of tweaks to health policy that appeared at least briefly to be on the legislative fast track this week. This was in the House amendment to Sen. Isakson's electronic health fairness bill (S 1347), which is on the Rules Committee's list of possible suspender bills for the week. But there has been no further action yet on the measure, and it's unclear whether the House and Senate could clear this measure in the remaining legislative days of 2015.

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Massive Omnibus Bill Cleared by Senate, Heads to Obama

By Ryan McCrimmon, CQ Roll Call

December 18, 2015 -- The Senate on Friday with little drama cleared 65–33 a $1.15 trillion omnibus appropriations bill and tax extenders package, as members raced to complete business before a holiday recess.

The massive legislation (HR 2029) now will go to President Barack Obama for his expected signature. The omnibus bill was passed by the House earlier in the day 316–113. The tax break extensions were passed Thursday by the House, 318–109.

The final Senate vote came following a 72–26 cloture vote. Both chambers were expected to adjourn by the end of the day.

The easy passage of the omnibus was a rare result for an appropriations bill and a marked difference from the fiscal 2015 omnibus that squeaked through the House by a 219–206 margin one year ago.

The trend could continue. Senate Majority Leader Mitch McConnell said after the vote that he's prepared to devote significant floor time next year to moving individual appropriations bills. The Kentucky Republican said getting into the budget and appropriations process earlier in the year than usual, and moving spending bills individually, would demonstrate that the Senate is functioning and that could help Republicans in purple states get re-elected.

Particularly notable in the House Friday was the large show of support from House Republicans, who voted 150-95 for the omnibus—a strong backing for new Speaker Paul D. Ryan, R-Wis., who has pledged to move individual spending bills through the chamber next year. Ninety-five Republicans voted no along with just 18 Democrats.

"Paul made it clear that the more votes we have, the more leverage he's going to have in those fights," said Majority Whip Steve Scalise, R-La. "And I think you saw members joining in to say, 'I want to give the speaker more leverage,' and that resulted in 150 Republicans voting yes, which is historic and I think strengthens his hand for those negotiations."

The outcome is also a victory for Scalise and his whip team, who set out to overcome what some characterize as the "hope yes, vote no" culture of voting against bills for political reasons while hoping the legislation passes.

"I reached out to our members a few weeks ago and said, 'If there's strong objections you have with a bill, then you have to vote that way. But if you think it's a bill that's more good than bad and is actually an important bill to pass, then don't just hope yes, it's your responsibility to vote yes,'" Scalise said.

In an unusual move, Ryan himself voted for the spending package.

House Democrats pitched in 166 votes in favor of the bill after two days during which members' public comments about the omnibus mostly ranged from tepid backing to fiery opposition. But late endorsements from Democratic leaders, including the White House and House Minority Leader Nancy Pelosi, D-Calif., helped shore up support.

The spending agreement was the result of weeks of closed-door negotiations between congressional leaders and the White House, but few lawmakers on either side were thrilled with the outcome.

"No one is going to get everything they want and prevent everything they oppose from being included," said Minority Whip Steny H. Hoyer, D-Md., in a floor speech Thursday urging his colleagues to support the bill.

Conservatives were unhappy about the shortage of Republican policy wins in the bill, like language to restrict Syrian refugees or hit back on the administration's environmental agenda.

"You don't have anything on Syria in there, the pro-life gets are pretty small and there's just not enough in there for all the massive spending increases that are already baked into the pie," said Rep. Tim Huelskamp, R-Kan.

Numerous Democrats also were dismayed that the package lifted a decades-old ban on crude oil exports and failed to provide any bankruptcy relief for Puerto Rico.

"I can give you a litany of things that are wrong with this bill," Rep. Luis V. Gutiérrez, D-Ill., told reporters Thursday. He added that leaders should pass another short-term continuing resolution in order to renegotiate the spending and tax extenders deal.

Congress is currently operating on a six-day funding patch (H J Res 78) running through Dec. 22.

Gutierrez was one of the 18 Democrats to vote against the measure. He was joined by the co-chairmen of the Progressive Caucus, Keith Ellison of Minnesota and Raúl M. Grijalva of Arizona.

Nydia M. Velázquez, D-N.Y., the first Puerto Rican woman elected to Congress, voted for the bill despite concerns about the lack of language addressing Puerto Rico's financial woes.

G.K. Butterfield of North Carolina, chairman of the Congressional Black Caucus, also supported the omnibus on the floor, as did Linda Sánchez of California, chairwoman of the Hispanic Caucus.

The Senate votes were similarly drama-free, as members mingled and back-slapped on the chamber floor for the last time this year.

Sen. Marco Rubio, R-Fla., who previously endorsed rumored efforts to delay Senate consideration of the omnibus, wasn't present for the vote series.

Rubio's fellow GOP presidential candidates Rand Paul of Kentucky and Ted Cruz of Texas voted against final passage while Lindsey Graham of South Carolina voted in favor.

The chamber also waived 73-25 a budgetary point of order from Joe Manchin III, D-W.Va., who was seeking separate votes on the tax extenders and spending legislation.

Tax Breaks

The package included $680 billion in permanent and short-term extensions of tax breaks for businesses and individuals. Included were permanent extensions of several of President Barack Obama's signature incentives for workers, including the expanded earned income tax credit and additional child tax credit. Several GOP provisions aimed at cutting off benefits to undocumented workers were dropped from the final language.

The worker incentives were coupled with permanent business tax sweeteners including the research and experimentation tax credit and a $500,000 cap on small-business expensing.

The legislation also would delay three taxes contained in the 2010 health care overhaul to help offset the cost of its insurance coverage expansion. A 2.3-percent excise tax on medical devices that took effect in 2013 would be paused in 2016 and 2017 and another levy on high-cost "Cadillac" employer health plans would be delayed from its scheduled start in 2018 to 2020. In addition, The package would also suspend the law's annual tax on insurers that took effect in 2014 for one year in 2017.

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Omnibus Mandates Extensive Drug-Cost Report from CMS, VA

By Kerry Young, CQ Roll Call

December 16, 2015 -- The fiscal 2016 spending package requires a wide-ranging report within six months on prescription drugs purchased by Medicare, Medicaid, and Department of Veterans Affairs (VA), a sign of growing congressional interest in the costs of medicine and Americans' access to them.

Through a statement attached to the $1.15 trillion spending package (HR 2029) unveiled Wednesday, House and Senate appropriators direct the Department of Health and Human Services to work with the VA on a report on prices paid since 2003 for prescription drugs purchased through major federal medical programs. The report also is intended to evaluate access to these treatments and include an analysis of how much time and money it takes to bring new medicines to market. The report—which could generate attention presidential candidates if released publicly—is due 180 days following the enactment of this spending package, likely creating a June deadline.

The rising costs of medicines have become an increasingly political concern that has gotten traction on the campaign trail in recent months, with the extreme case of a price markup of a decades-old antifungal serving as a rallying point for a more widespread problem facing many Americans. Spending on medicines in the U.S. may reach the $560 billion to $590 billion range in 2020, a 34 percent increase from estimates for 2015, according to pharmaceutical industry consultant IMS Health Inc.

There's bipartisan interest in this report, which was suggested by Rep. Marcy Kaptur, D-Ohio. Senate appropriators revised an initial proposal for this study, which called for information on the 10 most frequently prescribed and 10 most costly medicines purchased though the VA, Medicaid and Medicare's Part B outpatient program that covers treatments administered by doctors and Part D prescription-drug plans. The final version appears to drop an earlier request to tie in information about the prices paid in foreign nations, including Canada and Mexico. That had been included in the House report (H Rpt 114-195) for the Labor-Health and Human Services-Education bill (HR 3020).

But the final version of the drug-report mandate adds a request for a detailed evaluation of how easily people in these programs can obtain needed medicines and their satisfaction with them.

Separately, the final version of the omnibus also signals support for the continued work of the Center for Medicare and Medicaid Innovation, which was created by the 2010 health law. The center is intended to fund projects carried out in doctors' offices and hospitals to test proposals for improving the quality of health care while keeping costs in check.

The center has faced criticism for drawing slowly from the $10 billion provided it in initial funding through the health law. That may have made this money an easy target for lawmakers in search of rescissions to beef up spending for favored programs. Operating under an initial tight budget cap, the House GOP appropriators had proposed rescinding the $6.8 billion in remaining funds for the center. Both the Senate draft bill (S 1695) and the final omnibus measure left these funds alone.

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Obamacare, Antitrust Laws Can Coexist, Says FTC Official

By Jad Chamseddine, CQ Roll Call

December 15, 2015 -- A top Federal Trade Commission (FTC) official is denying accusations by congressional Republicans and medical providers that the health care law has triggered excessive industry consolidation.

Federal antitrust rules can regulate competition in harmony with the Affordable Care Act, the White House's landmark legislative achievement, according to Deborah Feinstein, director of the FTC's Bureau of Competition. Republicans have criticized the health law, which mandates that individuals carry health insurance or face a penalty, since its passage in 2010. Republicans have pointed to statistics showing that mergers among hospitals nearly doubled between 2009 and 2013. 

"We frequently hear that there is a conflict between the Affordable Care Act (ACA) and antitrust enforcement," Feinstein said Tuesday at the National Press Club in Washington. "The goals of the ACA are in harmony and not in conflict."

Feinstein added that the health law does not bar hospitals and other providers from corroborating unless it is done in an anti-competitive manner, such as in fixing prices. "There are other practical ways of achieving coordinated care and alternative payment models beyond merging with a close competitor," Feinstein said.

The FTC, which shares antitrust enforcement duties with the Justice Department, is mainly in charge of reviewing mergers by providers such as hospitals and pharmaceutical companies, while the Justice Department typically oversees consolidation among insurers.

Feinstein said her agency would not block a merger of hospitals or physician-owned practice groups that improves quality with a slight price increase. She added that transactions the FTC takes issue with are often unnecessary and deliver no economical benefit to consumers. Injunctions filed to prevent these mergers are rare, with the FTC only challenging a "handful" of the "hundreds of these transactions" that occur annually, she said.

Even so, the FTC has stepped up enforcement efforts in blocking anti-competitive hospital mergers. Buoyed by recent high-profile victories in federal court such as the blocking of Idaho's St. Luke Health System Ltd.'s acquisition of Saltzer Medical Group PA and forcing Ohio's ProMedica to divest itself of St. Luke's Hospital in Toledo, the FTC is sending a message to the hospitals and physician-owned practice groups to work within the confines of these laws.

Feinstein said the FTC had to change its strategy after experiencing a "losing streak" when trying to block hospital mergers in the 1990s. That included developing better economic models to examine competition.

Just last week, the FTC was joined by the Pennsylvania Attorney General's office in blocking the proposed merger between hospitals PinnacleHealth System and Penn State Hershey Medical Center on grounds that the combination would hurt consumers.

Feinstein also addressed growing concern among some lawmakers in Congress that drug prices are increasing too rapidly, saying the FTC cannot control costs because it is not a regulatory body that can put a cap on prices.

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Alexander Says 'Step-By-Step' Process Only Way to Change Obamacare

By Niels Lesniewski

December 18, 2015 -- The way to change Obamacare in the coming years will be through bipartisan adjustments, one of the Senate GOP leaders on health policy said Thursday.

"I think over the next four or five years it'll be changed step-by-step toward a health care system with more freedom for people to find policies, more choices and hopefully lower prices," Lamar Alexander, chairman of the Senate Health, Education, Labor and Pensions (HELP) Committee, said Thursday when asked about the future of the health care law.

Republicans have worked to use the budget reconciliation process to get a broader rollback prepared to be able to get to President Barack Obama's desk, but that amended measure will face a certain veto when cleared through the House.

Speaking during an interview for C-SPAN's "Newsmakers" program that is scheduled to air on Dec. 20, the Tennessee Republican said the recently enacted overhaul of elementary and secondary education that replaced the much-despised No Child Left Behind law could serve as a model.

The HELP Committee spearheaded that effort in the Senate, with Alexander and ranking Democrat Patty Murray of Washington taking the lead, but much of the health care puzzle is shared with the Finance Committee.

It's the revenue pieces of the Affordable Care Act that might prove the most difficult to address over the long term. While several Obamacare taxes, including the so-called "Cadillac tax" on premium health insurance plans, will be delayed as part of the big appropriations and tax deal moving through Congress this week, patches are considered very expensive by the Joint Committee on Taxation, since preventing collection of the taxes obviously reduces revenue.

"This was an historic mistake," Alexander said. "That the design of his health care law was a bad idea. It expanded a health care system that already cost too much. It told people that Washington knows better than you what policy you ought to buy. You might want a lower-cost policy that fits your budget and fits your health care needs, Washington's saying, 'No, you can't do it.'"

Alexander said that over the long-term, the lost Obamacare revenue might need offsets. As a senior member of the Appropriations Committee, Alexander sought to emphasize that the omnibus spending bill's funding itself is not driving the deficit.

"It's the two-thirds of the budgets that we don't work on, which is mandatory spending that is the big problem," Alexander said, referring to entitlements such as Social Security and Medicare. "So, we need to keep in mind health care costs as we try to fix Obamacare."

"We're going to have to change this, and we're going to have to do this carefully so we don't hurt people more than they've been hurt," Alexander said of the health care law itself. "Well, we can't do it in a partisan way. I like the No Child Left Behind fix."

A bipartisan deal to change Obama's signature health care law probably isn't on the table while the current president remains in the White House, even but looking down the road, bipartisan fixes would be a marked change from the chants of "full repeal."

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