2.5.18 – 2.9.18 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.




FY18 Appropriations

On Wednesday, Senate leaders reached a two-year budget agreement to raise spending caps on defense and domestic spending, which should put an end to a series of short-term spending bills and shutdown fights that have taken place over the last few months. The agreement extends funding for federal programs through March 23, increases discretionary spending caps put in place by the Budget Control Act of 2010 for both defense and non-defense for FY18 and FY19, provides emergency supplemental funding for disaster relief, suspends the debt ceiling until March 1, 2019, and addresses a number of other health care issues, among other provisions.


The current continuing resolution (CR) expired Thursday at midnight and in an unexpected turn of events, the government briefly shut down overnight after Senator Rand Paul (R-KY) blocked consideration of the measure because he did not get a vote on an amendment to keep Congress under strict budget caps, as well as stripping the debt limit from the package. However, the Senate voted, 71-28, to pass the package at about 2:00 AM this morning, with the House following suit, 240-186, at about 5:30 AM. The President signed the bill into law around 8:30 this morning ending the shutdown.


Specifically, the agreement increases defense spending by $80 billion in FY18 and by $85 billion in FY19, while raising nondefense spending by $63 billion and $68 billion respectively.


As part of the agreement, the National Institutes of Health (NIH) is expected to receive an increase over FY17 of at least $1 billion in FY18 and at least $1 billion in FY19.  This commitment is not explicitly specified in the legislative text of the Bipartisan Budget Act, but rather would be implemented when appropriators receive their subcommittee allocations and draft the omnibus for FY18 and the FY19 spending bills. As such, the final spending bills could potentially provide NIH with more than the $1 billion increases reserved in the agreement, within the confines of the subcommittee's allocation for each of those years.


In addition, the agreement provides $6 billion over 2 years for opioid prevention and treatment activities, $3 billion for FY18 and $3 billion for FY19. While the appropriators will have significant latitude in how they allocate the dollars, per the attached summary released by the Leader’s office, the intent is that the funds be used:

To combat the substance abuse epidemic, including enhanced state grants (with additional assistance for those states with the highest mortality rates and tribes), public prevention programs, and law enforcement activities related to substance abuse and mental health programs

The agreement, among other things, also:

  • Authorizes $7 billion for community health centers over two years
  • Extends authorization for the Children's Health Insurance Program (CHIP) for 10 years, or four years longer than already approved under the current CR
  • Delays Medicaid DSH cuts by 2 years
  • Repeals the Independent Payment Advisory Board
  • Extends a number of Medicare programs that recently expired -- including a permanent extension of certain payment cap exemptions for outpatient therapy and the availability of Medicare Advantage Plans for individuals with special needs
  • Adjusts or delays cuts to various provider payments and modifies numerous Medicare policies dealing with telehealth, home health services and other programs and procedures


A section-by-section summary of the health extenders title of the bill is attached.


With the government now operating under a CR until March 23, the Appropriations Committee will now use this time to write an FY18 Omnibus spending bill to the new, higher spending levels for both defense and non-defense programs.


FY19 Appropriations

The Administration is scheduled to release their Fiscal Year 2019 budget request to Congress on Monday, however there are rumors that the release could be delayed due to the enactment of the budget deal.


Assuming the budget is released as scheduled on Monday, the White House may add an "addendum" in a nod to the last-minute deal that outlines how the Administration believes the additional dollars should be spent.


Department of Health and Human Services (HHS) Secretary Azar is scheduled to testify on the request at the Ways and Means Committee on Wednesday and the Senate Finance and House Energy and Commerce Committees on Thursday.



The White House Council of Economic Advisors released a report today on reducing prescription drug pricing.  Some of the key recommendations in the wide-ranging report include:

  • Changes to the Medicare Part B program, including:
    • Introducing physician reimbursement that is not tied to drug prices
    • Moving Medicare Part B drug coverage into Medicare Part D
    • Changing how pricing data is reported to increase transparency
  • Changes to the Medicare Part D program, including:
    • Requiring plans to share drug manufacturer discounts with patients
    • Allowing plans to manage formularies to negotiate better prices for patients
    • Lowering co-pays for generic drugs for patients
    • Discouraging plan formulary design that speeds patients to the catastrophic coverage phase of benefit and increases overall spending
  • Allowing FDA to give expedited review for brand drugs that are the second or third in their class in order to create more market competition
  • Policies to decrease concentration in the pharmacy benefits manager market and other parts of the supply chain to increase competition and reduce prices
  • Policies to limit under-pricing of drugs in foreign markets




House Ways and Means Committee

On Tuesday, the House Ways & Means Committee, Subcommittee on Health held a hearing titled, “Removing Barriers to Prevent and Treat Opioid Abuse and Dependence in Medicare.”


For a webcast of the hearing and witness testimonies, see here.  Opening statements from House Ways and Means Committee Chairman Kevin Brady (R-TX) and Health Subcommittee Chairman Peter Roskam (R-IL) can be found, here.

Hearing witnesses discussed the ongoing opioid crisis, and the important role data, addiction prevention, and access to treatment play in addressing the crisis. The hearing also examined possible legislative solutions to combat opioid misuse, specifically by Medicare recipients. Recommendations included paying for outpatient opioid use disorder (OUD) treatment and giving health plans more flexibility to limit prescriptions of pain killers and reimbursing for support services, such as counseling and drug screening.

A full summary of the hearing is attached.

Senate HELP Committee hearing on Opioids

On Thursday, the Senate Health, Education, Labor & Pensions (HELP) Committee, hearing entitled, “The Opioid Crisis: Impact on Children and Families.”  For a webcast of the hearing and witness testimony, see here.  For HELP Chairman Lamar Alexander’s (R-TN) opening statement, see here.


Alexander noted in his opening statement that he, Sen. Murray (D-WA), Sen. Young (R-IN and Sen. Hassan (D-NH) would be introducing legislation yesterday to give the National Institutes of Health (NIH) more flexibility in their use of funds to address public health threats, including opioids.  A section-by-section summary of the bill are attached. He said that bill, along with other legislation, could be marked up by the Committee as early as March.


A full summary of the hearing is attached.


House Judiciary Committee

On February 15th the House Judiciary Committee Subcommittee on Immigration and Border Security will hold a hearing entitled, “The Effect of Sanctuary City Policies on the Ability to Combat the Opioid Epidemic.”  As of press time, a witness list has not been announced.


House Education and Workforce Hearing

On February 15th, the House Education and Workforce Subcommittee on Health, Employment, Labor and Pensions and Subcommittee on Workforce Protections will hold a joint hearing entitled, “The Opioids Epidemic: Implications for America's Workplaces.”  As of press time, a witness list has not been announced.


House Energy and Commerce Committee

Looking forward, the House Energy and Commerce Committee will begin holding hearings on legislative proposals, the “CARA 2.0” package, to address the opioid misuse and overdose epidemic the week of February 26th.  The specific date(s) for the hearings and witnesses have not been released.



This week, reports came out that tensions between the White House and Veterans Affairs Department are very high right now, with strong indication the president will fire Deputy Secretary Thomas Bowman.  At the heart of the conflict is VA Secretary David Shulkin and Bowman’s implementation of the Veterans Choice Act which expands access to private health providers for VA beneficiaries and reforms the Veterans Health Administration.  The VA has several leadership posts unfilled, delaying the implementation of the bill.  Several senators have criticized Shulkin and Bowman are not aggressively meeting benchmarks of the agency overhaul.  As a result of the mounting criticism, the VA is expediting its process to fill key positions and redoubling efforts to implement the VHA reforms and expand veterans health choices.


Katie Weyforth Vanlandingham

Van Scoyoc Associates

800 Maine Ave SW

Suite 800

Washington, DC  20024