Nov 13, 2017
Washington Healthcare Update
DOD bill could undermine FDA authority…CMS pushes 1115 waivers for opioid
epidemic…Maine votes to expand Medicaid…Ohio kills drug proposal.
Tax Bill Does Not Include Individual Mandate Repeal
Republicans are considering repealing the mandate that currently requires
that most Americans obtain health coverage. The Republican House-proposed
tax bill could be a vehicle for such an effort. However, so far, the bill
has moved through markup without such a provision being added.
Repealing the Affordable Care Act’s individual mandate would reduce the
federal deficit by $338 billion between 2018 and 2027, the CBO said in a
The Senate Republican proposal released on Nov. 9 does not include a repeal
of the mandate. GOP leaders are talking with rank-and-file members to
assess whether they have the necessary 50 votes to repeal this provision of
the Affordable Care Act.
DOD Bill Could Undermine FDA
Section 732 of the Senate’s version of the National Defense Authorization
Act, HR 2810, creates a new regulatory structure that would allow the
Pentagon to sign off on unapproved devices and drugs for emergency use on
military personnel and others in harm’s way. Never before has authority
been provided to an agency to decide approval for drugs and devices for its
own use and outside the FDA.
HHS says it would undermine medical safety and potentially put soldiers at
risk. FDA currently has sole authority to authorize drugs and devices for
The conference language would create two safeguards. First, a new DOD
committee of health care experts, appointed by the defense secretary, would
need to recommend emergency use of an unapproved drug or device. Second,
the assistant secretary of defense for health affairs would need to
authorize the drug’s or device’s use after consulting with the FDA. The
proposal is backed by Senate Armed Services Chairman John McCain (R-AZ).
FDA offered an alternative proposal, which would have expedited drug and
device reviews and approval upon a DOD request, but the language wasn’t
Senate HELP Chairman Lamar Alexander, House Energy and Commerce Chairman
Greg Walden and Sen. Richard Burr asked congressional leaders to hold off
on signing the annual defense policy bill, saying that it contains language
that will put soldiers at risk and undermine the FDA. Instead of delaying a
vote on the legislation to make changes, the House Armed Services and
Energy and Commerce committees will continue talks on a potential fix,
which could then be attached to another must-pass bill.
Wyden and Murray Specify Requirements for Next Nominee for HHS
On Oct. 30, Sen. Ron Wyden (D-OR), ranking member of the Senate Finance
Committee, and Sen. Patty Murray (D-WA), ranking member of the Senate
Health, Education, Labor and Pensions Committee, laid out a series of
requirements in a letter to President Trump that they say the president’s
next nominee to head the Department of Health and Human Services must meet
to gain Democratic support.
Their criteria include that the nominee support: deployment of HHS
resources to address the opioid crisis; tobacco regulation, especially for
products targeting youth; nutrition policies that provide information to
consumers; efforts to reduce the cost of prescription drugs; and strong
safety and efficacy standards for drugs and devices.
Grassley and Blumenthal Push Funding for Open Payments Database
Sens. Chuck Grassley (R-IA) and Richard Blumenthal (D-CT) wrote HHS Acting
Secretary Eric Hargan on Nov. 2 asking him to prioritize funding of CMS’s
Open Payments database.
The Open Payments database, created under the bipartisan Physician Payments
Sunshine Act, requires drug and device manufacturers and group purchasing
organizations to report payments to teaching hospitals and physicians. CMS
first published that database in 2014.
The senators believe this information is of particular concern at a time
when overprescribing of opioid medications has exacerbated a public health
crisis nationwide. Grassley and Blumenthal are the lead sponsors of a bill
to expand the Physician Payments Sunshine Act disclosure requirements to
apply to nurse practitioners and physician assistants, who are currently
not mandated to disclose transactions with drug manufacturers.
To read the letter,
FDA Extends Precertification Model to Low-Risk DTC Genetic Tests
On Nov. 6, FDA said it is extending its precertification model to low-risk
direct-to-consumer genetic risk tests. Commissioner Scott Gottlieb made the
announcement in a blog post.
Labs could seek a one-time review of their fitness to deliver safe and
effective tests; after they have passed this test, Gottlieb said, no
additional approvals would be required as long as the labs demonstrated
they were keeping abreast of scientific literature, among other benchmarks.
This would dramatically relax conditions for marketing the tests.
The deregulation move would not apply to all tests. An accompanying order
notes that particularly risky tests—such as those testing life-threatening
diseases—would not be exempt from premarket requirements.
FDA Releases Guidance to Assist Collaboration Between Brand-Name Drugs
and Generics on REMS
On Nov. 8, the FDA released guidance to help make it easier for makers of
brand-name drugs and generics to collaborate on mandated safety programs
known as REMS—a move that should make it harder for brand drug companies to
use REMS to prevent competition.
FDA prefers that brand and generic companies have one REMS system per
product to reduce the burden on doctors and the pharmacy system. However,
brand-name drug makers sometimes make it difficult for the generic company
to join their safety plan as a way to forestall competition.
Gottlieb also said he will be contacting wholesalers and other supply chain
intermediaries in the coming weeks to inform them of FDA’s interest in
making sure generic firms can gain access to samples of branded products
for studies needed to get a generic approved. Brand-name companies have
tried to use the REMS programs or contracts with wholesalers to block
generic drug makers from getting access to samples.
CMS Urges States to Use 1115 Waiver Process on Opioid Abuse
On Nov. 1, timed with the release of the president’s commission on opioids,
CMS announced a new policy to allow states to design Medicaid demonstration
waivers aimed at curbing the opioid epidemic and to encourage more states
to apply for such waivers. These waivers are designed to create a continuum
of care including residential care—for which these waivers have already
been used to get around the IMD exclusion. CMS also approved substance use
disorder (SUD) waivers in Utah and New Jersey.
Instead, the new policy allows states to apply for changes to their
Medicaid program to deliver care in the substance abuse arena without
requiring them to modify their entire continuum of care.
Under CMS’s new policy, states will be able to receive a federal funding
share for services to treat opioid addiction or other SUDs.
The New Jersey and Utah waivers were approved in accordance with the new
policy. The New Jersey waiver appropriates Medicaid funds to pay for
medication-assisted treatment (MAT), residential withdrawal management
treatment, peer supports and targeted case management. New Jersey Gov.
Chris Christie (R), a member of Trump’s opioid commission, said that the
waiver would allow thousands more people in New Jersey to access treatment.
The Utah waiver will expand Medicaid treatment to up to 6,000 childless
adults who are either homeless, involved in the criminal justice system or
need substance abuse treatment. The approved waiver does not include
proposed amendments that included Medicaid work requirements and time
limits on coverage. The state said enrollment for newly eligible Medicaid
beneficiaries will begin immediately.
Maine Votes to Expand Medicaid
Maine voters approved an expansion of the state’s Medicaid program under
the Affordable Care Act—the first time state voters have directly
authorized such an expansion, and against the governor’s opposition.
Maine Gov. Paul LePage said on the day after the election that “I will not
support increasing taxes on Maine families, raiding the rainy-day fund or
reducing services to our elderly or disabled.” LePage is a Republican who
is term-limited next year and has spearheaded the opposition to the ballot
Democrats hold a majority in the Maine House and Republicans control the
state Senate—and because state lawmakers have already repeatedly supported
expanding the program, it is not likely that the legislature would try to
block the proposal going forward. The ballot measure requires Maine to
submit a plan accounting for the expansion to the Department of Health and
Human Services within 90 days.
About 80,000 adults will qualify under the expansion, according to
independent estimates from a Maine legislative fiscal office.
Ohio Measure on Drug Prices Defeated
An Ohio ballot measure aimed at lowering drug prices was defeated. The
measure would have required that state agencies purchase prescription drugs
at prices no higher than those paid by the U.S. Department of Veterans
Affairs. It was virtually identical to a proposal narrowly defeated by
California voters in 2016.
The ballot campaign was the most expensive in the state’s history. The drug
lobby PhRMA spent nearly $60 million in the race, spending almost twice as
much per voter as it did in California.
Identical ballot measures in South Dakota and Washington, D.C. are expected
Prescription Opioids: Medicare Needs to Expand Oversight Efforts to
Reduce the Risk of Harm:
GAO-18-15, Oct. 6
The GAO released a report concerning Medicare’s oversight of the use of
opioids and their associated risks with the Medicare populations. The GAO
recommended the CMS should gather information over time on the number of
beneficiaries at risk of harm from opioids, including those who received
high opioid morphine equivalent doses regardless of the number of
pharmacies or providers as part of the assessing progress over time in
reaching CMS’s goals related to reducing opioid use.
To read the report,
To view the highlights of the report,
To listen to the podcast,
If you have any questions, contact the following individuals at
Kennan, Senior Vice President
Anne Starke, Research Associate
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