November 04, 2016

Understanding the Health Care Agenda During the Lame Duck Session

While much attention is being paid to what the health care agenda for the next presidential administration will look like and who the key players will be, stakeholders need to be preparing for near-term opportunities and challenges looming ahead in the lame duck session of Congress.

Such sessions – held after an election but before the start of the next session – are often seen as opportunities to act on significant policy issues that may be easier to address when a segment of the body is not returning, either because of retirement or defeat at the polls.

Those with unfinished legislative business view the lame duck session as their last chance to complete their work before having to start anew in the next Congress. But while such opportunities do exist, they require an effective and well-planned strategy—as well as the alignment of multiple stars.

For starters, the scope of the coming lame duck session will be influenced heavily by the outcome of the elections. If Democrats retake the Senate and make up ground in the House, many would likely want a minimal lame duck agenda so they can exert greater influence come January. Conversely, Republicans would want to leverage the majority while they have it. The outcome of the presidential election will also impact legislative ambitions during the lame duck.

In terms of what Congress absolutely must do this lame duck, the list is fairly short. With funding for the federal government expiring December 9, lawmakers will have to address appropriations for Fiscal Year 2017. They could do this through another shorter-term extension of spending under current levels into the next Congress, or they could enact a package of appropriations bills in either an “omnibus” or a series of smaller “minibus” bills.

Many stakeholders, particularly those who are optimistic their priorities will receive an increase in funding, would like Congress to complete work on FY 17 measures this year rather than punt into 2017. In the health sector, these stakeholders include advocates for medical research at the National Institutes of Health (NIH) who were buoyed by increases for NIH funding included in both the House and Senate versions of an appropriations bill.

Beyond the appropriations bills, health care interests are pushing for action on several other pieces of legislation, though they do not enjoy similar “must-pass” status. Following is a run-down of several of these items that may be in play this lame duck:

  • 21st Century Cures: For more than two years, the House – led by the House Energy & Commerce Committee – has been focusing heavily on a suite of measures intended to accelerate development and delivery of new therapies and treatments. Dubbed the 21st Century Cures Act, the legislation passed the House by an overwhelming majority in July 2015. Additionally, the Senate Health, Education, Labor and Pensions (HELP) Committee has advanced a package of bills in a more piecemeal fashion.

    Many health interests including academic research institutions, patient advocacy organization and the drug, biotech and device industries have championed this initiative and have invested significant amounts of political capital on its behalf. At the same time, critics exist, particularly consumer and labor interests who are opposed to provisions they think provide too many incentives to industry to create expensive products that provide only modest benefits to patients.

    An additional challenge is whether Congress will be able to come up with enough ways to offset an increase in funding for the NIH as well as for the Food and Drug Administration (FDA). While Cures remains highly popular, questions around offsets as well as the larger debate on drug pricing could make enactment of even a slimmed down bill challenging. A final relevant factor is that the every-five-year rewrite of the FDA user fee law looms a head as a “must-pass” bill by September 2017, which could make deferring action on elements of Cures more likely.

  • Medicare Issues: The enactment of MACRA in 2015 took away what had been a longstanding annual “must-pass” bill to delay implementation of sizeable reductions to doctor pay rates, legislation other Medicare related provisions would often hitch rides on. While not a “must-pass” issue, a sizeable chunk of Congress remains concerned about implementation of Section 603 of last year’s budget agreement, which reduces reimbursement to hospital outpatient departments if they don’t meet certain criteria and if they were not billing Medicare as of November 2, 2015.

    Earlier this week, CMS finalized its payment policy for these entities, meaning that absent Congressional action, cuts will go into effect beginning in January. In June, the House passed a bill that would exempt facilities that were “mid-build” at the time the law was enacted from being shifted to the lower payment rates, and last month 261 House members and 45 Senators wrote CMS asking them to be more flexible in implementing the rule. The Congressional Budget Office (CBO) estimated that the mid-build provision would cost $760 million over 10 years, but the bill includes a 0.04 reduction in overall hospital payments to cover the cost. With the final rule now out and concerns largely unaddressed, stakeholders may ratchet up the call for congressional action during the lame duck.

  • Mental Health: Driven by deficiencies in the mental health system laid bare by several mass shooting incidents, a bipartisan group of lawmakers has been working to reform federal programs supporting mental health for years. The House, in a 422-2 vote in July, passed a package of reforms including authorization of new grant programs and the creation of a new assistant secretary position focused on mental health and tweaks to Medicaid coverage policies. Despite the lopsided House vote, concerns about the lack of funding to implement the law and ongoing connections to gun control politics make the prospect for lame duck action uncertain.

  • Abuse and Addiction Issues: The enactment of the Comprehensive Addiction and Recovery Act (CARA) earlier in the year was a bipartisan high water mark of 2016. Driven by near universal concerns about rising opioid and heroin epidemics, Congress will now be tasked with adequately funding these measures. While this will play out in the FY 17 appropriations process, it may also play into 21st Century Cures if the opportunity presents itself.

  • ACE Kids: Children’s hospitals and child health stakeholders have been working for years on legislation aimed at improving care management of children with highly complex medical conditions. Known as the ACE Kids Act, the bipartisan bill enjoys strong support in both chambers. Opposition has come largely from companies that run Medicaid managed care plans, who are concerned the legislation would encroach on their business. If ACE does not move this year, it may be coupled with work on reauthorization of the Children’s Health Insurance Program (CHIP) in 2017.

  • Zika Response: Funding to respond to the Zika crisis was a significant issue earlier this fall when Congress enacted the temporary spending bill, which expires December 9. While that package included money for Zika, continuing concerns for more money could play out during the lame duck. Zika could also be used as an example of the types of public health disasters that require a more stable response mechanism.

While the final scope of the lame duck remains to be determined, Congress has a number of health care policy issues it may opt to address—or not to address—while planning concurrently for the new administration and Congress.

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