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Source: Wikimedia Commons and James Montgomery Flagg

The LD in DC

Jessica Mehta • Wed, April 19th, 2017

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Getting the low down on healthcare happenings in Washington, D.C. helps prepare us for challenges—and sometimes, a few sweet surprises.

On April 6, 2017, the House Rules Committee approved an American Health Care Act (AHCA) amendment to create a “federal invisible risk-sharing program.” At first, naysayers suggested the rush job of this last minute approval was really just for show. However, on April 12, 2017, President Trump re-affirmed his commitment to “repeal and replace” the Affordable Care Act (ACA) before tackling tax reform. “I have to do healthcare first, I want to do it first to really do it right,” he said. However, no concrete steps to repeal and replace have happened yet.

Proposed IPPS Payments

The Centers for Medicare and Medicaid Services (CMS) released proposed changes for the 2018 budget year’s Inpatient Prospective Payment System (IPPS) with key recommendations for orthopedics and total ankle replacement (TAR) in particular. Total payment increase to hospitals are proposed at a whopping $3 billion for next year.

ACA “Fixes”

On April 13, 2017, CMS also unveiled their final rule to help ACA marketplaces stabilize. The new, tighter rules shorten 2018’s enrollment period, ups flexibility of benefit design, and streamlines the administrative process. It’s a step in the right direction, but many are underwhelmed, including America’s Health Insurance Plans (AHIP). “There is still too much instability and uncertainty,” said AHIP in a statement. “Health plans and consumers … need to know that funding for cost-sharing reduction subsidies (CSRs) will continue uninterrupted.” There’s a lot of momentum to fund CSRs, but it’s still uncertain whether the funding will be approved during the 2017 spending extension in late April 2017.

April Showers

It’s a busy month for Medicare, with the Medicare Payment Advisory Commission (MedPAC) unanimously voting to approve changes to Part B drug reimbursement. Now, Medicare has negotiating power for drug costs under Part B. Full changes will go into effect by 2022. Commissioners are also angling to modify the payment formula, which currently allows physicians 106% of a drug’s cost.

Instead, MedPAC wants to require drug makers to report their average sales price (ASP) and then make a rebate payment to Medicare once ASP passes a certain level. Ultimately, this may decrease program costs by up to $270 million in just one year. Program spending can save up to $5 billion in a five-year period. However, Pharmaceutical Research and Manufacturers of America (PhRMA) released a statement saying the MedPAC changes may “have a detrimental impact on access for patients who rely on Part B therapies to treat serious and complex conditions.”

MedPAC isn’t the only one under fire. Scott Gottlieb, M.D., nominee to head the Food and Drug Administration (FDA), faced off against the Senate Health, Education, Labor and Pensions (HELP) Committee during an April 5, 2016 nomination hearing.

He was grilled about his ties to the industry, his character, and current processes for approving new drugs. Dr. Gottlieb was also quizzed on the opioid crisis in the U.S., the 21st Century Cures Act, and drug pricing. He adamantly declared that he would make impartial choices steeped in science, leaving politics at the wayside. Among his top priorities, Gottlieb ticked off approving generic drugs and battling the opioid epidemic, all while encouraging the FDA to be more flexible and responsive. Gottlieb’s nomination will be confirmed or denied on April 24, 2017.

Dr. Gottlieb’s nomination isn’t the FDA’s only hot ticket item. On April 14, 2017, the FDA released a discussion draft regarding the agency’s user fee agreements. Although a number of influential people, including President Trump, urged the FDA to discuss drug prices in the draft, that prickly problem was largely unaddressed. There’s no trace of drug pricing policy riders. Instead, there’s a new approach to complicated generic drugs, a new biosimilars review model, and more resources for the FDA’s breakthrough drug pathway along with additional bells and whistles. For now, strategizing on drug prices with user fee reauthorizations is on the back burner—and that’s exactly how bipartisan committee members seem to like it.

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