7.9.18 – 7.13.18 Health Wrap Up

Please find below a summary of the latest major health policy developments in Washington this week. Please let us know if you have any questions.


House and Senate Republican leaders are reportedly discussing a proposal for July floor votes on two more FY19 minibus spending packages. Next week the House is scheduled to consider a two-bill spending package containing the FY19 Financial Services and Interior-Environment bills. While no details have been announced, the Senate could also take up one or more FY18 spending packages in the coming weeks, to possibly include a package coupling the Defense and Labor HHS measures.

The goal would be floor votes on nine of the twelve fiscal 2019 bills before the current fiscal year ends September 30. Due to funding to carry out immigration policy and enforcing immigration laws, the Homeland Security, Commerce-Justice-Science, and State-Foreign Operations bills will purportedly be considered later.

Both chambers have passed a three-bill package combining the Energy and Water Development, Military Construction-Veterans Affairs, and Legislative Branch measures, but a conference meeting scheduled for Thursday was postponed because leaders have to figure out a new funding level for the VA in light of a new veterans’ law signed into law last month that created a budget gap by switching the program's community care services from the mandatory side of the ledger to the discretionary side. The House has also passed their FY19 Defense Appropriations bill.

House Labor HHS

Late Wednesday night, after a markup that lasted over 12 hours, the House Appropriations Committee approved 30-22 its FY19 Labor HHS spending bill. The committee adopted 18 amendments, a majority of which related to the separation of immigrant families at the US border.  A copy of the bill, report and accepted manager’s amendment can be found here and a list of the 49 amendments considered at the markup with brief summaries is attached.



It remains unclear if the Senate will take up a legislative package to address the opioid misuse and overdose epidemic this summer.  Leader McConnell (R-KY) has tapped Senate Health, Education, Labor and Pensions (HELP) Committee Chair Alexander (R-TN) to lead the development of a package that combines the work of the Senate committees (primarily HELP, Finance, and Judiciary).  Reports indicate little negotiation took place among the Senate chairmen or between the House/Senate over the 4th of July recess.

Mental Health

On July 19, the House Energy and Commerce Committee Health Subcommittee will hold a hearing on the status of implementation of the mental health reforms that were included in the 21st Century Cures Act.  Dr. Elinore McCance-Katz, Assistant Secretary of Health and Human Services (HHS) for Mental Health and Substance Abuse, is scheduled to testify.


On Wednesday, the House Energy and Commerce Subcommittee on Health held a hearing titled “Opportunities to Improve the 340B Drug Pricing Program.”  The hearing had the dual purpose of hearing from the Government Accountability Office (GAO) regarding its recent report investigating the 340B program, as well as hearing from health providers regarding “on the ground” use and implementation of 340B.  During the first panel, Members heard from the GAO about its findings and recommendations to improve the program.  GAO’s report demonstrated that the program is growing significantly and requires clearer statutory purpose, improved transparency, improved HRSA staffing, and penalties for misuse.  The second panel of providers included witnesses who want to preserve the program for their patients but support additional oversight to penalize bad actors and improve integrity of the program.

Committee members of both parties have introduced several 340B bills as the committee prepares to move 340B reform legislation. Both parties agreed the program is essential to provide drugs to low-income patients and needs improved transparency.  However, similar to previous 340B hearings in the House and Senate, battle lines were quite apparent.  Republicans generally support greater oversight of hospitals and other covered entities participating in the program to ensure the savings from the discounts are being used for legitimate purposes.  Democrats generally support “oversight parity” so drug companies participating in the program are equally scrutinized as providers to ensure they are listing their drug prices in a way which does not game the system.  The Committee will markup legislation in the near future, though the exact date remains unclear.


On Wednesday and Thursday, the Ways and Means Committee held a full committee markup on 11 bills which generally expand the use and eligibility of tax-preferred spending accounts, specifically health savings accounts and flexible spending accounts. The Committee approved:


  • HR 4616: Delays the Cadillac Tax for two years and delays the employer mandate by three years.
  • HR 6199: Allows over-the-counter drugs to be treated as a qualified medical expense for FSA/HSAs.
  • HR 6301: Provides that a high deductible health plan is permitted to provide certain services up to a dollar threshold without meeting the plan’s minimum deductible
  • HR 6305: Allows immunizations, physical exams, over-the-counter drugs, and vision/hearing screenings as eligible medical expenses.
  • HR 6306: Increases maximum contribution to an HSA related to a high-deductible plan to reflect the minimum deductible ($6600 for self)
  • HR 6309: Allows Medicare eligible individuals to enroll in an HSA.
  • HR 6311:  Designates copper plans as qualified health plans under the ACA.
  • HR 6312:  Allows gym memberships and sporting protective equipment as eligible medical expenses.
  • HR 6313:  Allows dollars remaining in an FSA at the end of a year to be carried forward to the next year.
  • HR 6314:  Treats silver and bronze plans under the ACA as high-deductible plans eligible for HSAs.
  • HR 6317:  Allows direct primary care service arrangements are allowable costs under HSAs.

Though most of the bills debated have bipartisan support individually, the markup was very contentious.  Democrats felt the markup of FSA/HSA legislation should be coupled with larger fixes to the health care system, not a one-off.  They particularly attacked recent efforts by the Trump Administration to weaken protections for preexisting conditions and the repeal of the individual mandate. Most bills passed along partisan lines.


ONDCP Nomination Hearing

On Wednesday, the Senate Judiciary Committee held a hearing on several judicial nominations and the nomination of Jim Carroll to lead the White House Office of National Drug Control Policy (ONDCP).  While Democrats called for an additional hearing on Carroll’s nomination because of the scope of the opioid misuse and overdose epidemic, Sen Crapo (R-ID), who was chairing the hearing, did not indicate that the second hearing would be held.

Sen. Kennedy (R-LA) grilled Carroll about what actions he will take to curb instances of extreme over-prescribing and pointed to the example of the very large number of pills prescribed in Kermit, WV; Kennedy stated that pills are being over-prescribed and that someone is making a lot of money off it. He asked what Carroll is going to do about this problem and who the President is going “to fire.”  When Carroll deferred to the Department of Justice, Kennedy said he did not mean to “pick on” him but he’d “had enough” after listening to 17 months of testimony on this problem and said the federal government is not doing their job.  Kennedy said that Carroll’s role is to make sure the government does its job, which includes making sure some pharmaceutical companies are not over producing, and to fire someone if needed.  Kennedy instructed him to write a letter with very specific steps on what he planned to do and said he was “tired of the platitudes.”

CMS Telemedicine Rule

On ThursdayCMS announced its Notice of Proposed Rule Making related to the Physician Fee Schedule under Medicare Part B and Quality Payment Program.  These changes would apply to calendar year 2019.  Though the rule proposes changes to reduce paperwork, such as reduced documentation of evaluation and management reports, the more noteworthy aspect are its changes to telemedicine.  The rule proposes to:

  • Pay clinicians for virtual check-ins – brief, non-face-to-face appointments via communications technology;
  • Pay clinicians for evaluation of patient-submitted photos; and
  • Expand Medicare-covered telehealth services to include prolonged preventive services.

Though the rule is limited to a somewhat narrow range of services under Part B, this rule bodes great potential for future expansion of telemedicine reimbursement for wider services in the future.  Comments regarding the NPRM are due to CMS by September 10th.

FY19 Labor-HHS-ED Markup Amendments FY19 Labor-HHS-ED Markup Amendments

Katie Weyforth Vanlandingham

Van Scoyoc Associates

800 Maine Ave SW

Suite 800

Washington, DC  20024