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HFA’s virtual 2020 Patient Fly-in took place over the week of Nov. 16.  Sixteen community members connected with their lawmakers via phone and Zoom to describe what it’s like to live with a bleeding disorder – and to explain what people in this community need in terms of quality, affordable health coverage. Fly-in participants also urged support for H.R. 7647, a bill to bar the use of accumulator adjusters for the duration of the COVID-19 pandemic and twelve months thereafter. Other community members participated in a “Virtual Hill Day,” using HFA’s Legislative Action Center to communicate with their lawmakers by tweets or emails. Thank you to all who participated! If you didn’t have a chance to participate earlier in the month, there’s still time to reach out to your lawmakers!

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Federal elections usher in a new Administration but leave Congress divided

The November 2020 election was historic for many reasons, including its circumstances (taking place amid a pandemic) and its candidates (Kamala Harris, for one, who will become the first female, Black, and Indian-American vice-president). Here’s what we know for now about the election, and its implications for health policy over the coming months and years.

President Donald Trump lost his bid for re-election; President-elect Joe Biden will be inaugurated on Jan. 20, 2021. The incoming Biden Administration may face difficulties in pursuing its health policy agenda via legislation, however, as it will be working with an almost equally divided 117th Congress. While Democrats will retain a (somewhat narrowed) majority in the U.S. House of Representatives, control of the Senate is still undecided: Republicans currently hold 50 seats and Democrats hold 48. Two Senate races, for both Georgia seats, will go to a runoff election on Jan. 5, since none of the candidates earned over 50% of the vote in the November election. If Democrats win both the Georgia runoffs, the Senate would be split 50-50, with Vice President Harris holding the tie-breaking vote.

Given the likely makeup of the 117th Congress, some key parts of President-elect Biden’s health policy agenda may face an uphill road: e.g., building on the Affordable Care Act through expanded financial assistance for purchasers of Marketplace plans; lowering the age of Medicare eligibility; creating a public option; etc.  But the incoming Administration will have other pathways and options to set health policy. These could include:

  • using regulatory and financial incentives to encourage remaining states to expand their Medicaid programs;
  • reversing Administration positions on restrictive Medicaid eligibility requirements;
  • restoring funding for Marketplace outreach, and re-opening the 2021 open enrollment period;
  • undoing a variety of Trump Administration regulations on topics such as availability of non-ACA-compliant health plans, state “flexibility” with respect to the operation of their Marketplaces, ACA non-discrimination requirements, and more.

Complicating – and underscoring – these efforts, the Biden Administration will have to make combating COVID-19 its top priority.

Results in state elections may create additional hurdles for the new Biden Administration. 

Going into the 2020 election, Democrats expected a “blue wave” at the state level that would build upon their substantial gains in 2018, when they won back most of the record number of legislative seats they had lost since 2010. Democrats had high hopes to flip chambers in key states like Florida, North Carolina, and Texas that would give them some path to finally expand Medicaid, as well as Arizona, Michigan and Pennsylvania where Republican legislatures had long stymied other efforts to implement, protect, or expand the ACA. However, their success in the Presidential race did not translate down-ballot where Democrats not only failed to make any state-level gains but lost at least 70 seats nationwide, including two chambers (the New Hampshire House and Senate).

Overall, Republicans now control 62 chambers in state legislatures (compared to only 37 for Democrats) including 24 “trifectas” where they control the governorship, House, and Senate (Democrats have only 15). Republicans also hold a “supermajority” status (where they can override gubernatorial vetoes) in 31 states (adding the Montana House)—and nearly a “supermajority” status in Florida, North Carolina and Wisconsin.

There was little turnover among governors or state attorneys general, where Republicans continue to hold slight leads nationwide (27-23 for governors, 26-24 for AGs). The only flip was the Republican win for Montana governor (giving them a “trifecta”).

The coronavirus pandemic dramatically limited the number of voter referendums (only 37 compared to a high of 60 in 2018). The most prominent victory created a paid family and medical leave program for Colorado (the first in the nation). Voters in Arkansas, Florida and North Dakota also rejected Republican efforts to make it more difficult for citizens to put voter referendums (such as Medicaid expansion) on future ballots.

Republican dominance at the state level may further limit the ability of the incoming Biden Administration to pursue an expansive health agenda. However, state reforms that have substantial bipartisan support, such as guardrails protecting consumers from copay accumulator adjusters, balance or “surprise” billing, and step therapy, should continue to progress nationwide in 2021.

Quick Hits:

  • The U.S. Supreme Court heard oral argument on Nov. 10 in the case of California v. Texas (the lawsuit over the constitutionality of the ACA). While it’s risky to predict how the Court might rule, many who listened to the hearing feel cautiously optimistic that a majority of the Court may lean toward upholding the ACA. No decision is expected in the case until 2021, however. It is important to remember – especially during the ongoing open enrollment period – that the ACA remains the law of the land for now.
  • The Trump Administration released three separate, long-pending, drug pricing rules on Nov. 20 (the timing was not accidental: the Administration is seeking to beat a 60-day deadline for finalizing the rules before President-elect Biden’s inauguration).
    • One plan would link Medicare Part B payments for 50 doctor-administered medicines to lower prices paid overseas (the so-called “Most Favored Nations” model, first floated in 2018).
      • Clotting factors and some other products used to treat bleeding disorders are Part B medicines, but they are not currently included in the rule’s list of medicines that would be subject to the MFN model.
      • The MFN plan is almost certain to draw legal challenges from drug manufacturers and others, on both procedural and substantive grounds.
    • Another rule takes aim at drug rebates paid by manufacturers to pharmacy benefit managers in Medicare Part D. This rule seeks to force PBMs and health plans to pass along those rebates to patients at the point of sale. Like the MFN rule, the rebate rule may be vulnerable to challenge (for one thing, the Administration explicitly stated in 2019 that it had withdrawn the proposed version of the rule from consideration – which calls into question whether HHS should have started over from scratch, rather than moving forward with the withdrawn rule).
    • A third final rule revises federal safe harbor rules under the Stark Law and Anti-Kickback Statute, with the goal of facilitating movement toward value-based care.
  • Federal regulators (CMS) finalized health insurance transparency regulations that for the first time require both group and individual plans to disclose whether they are applying cost-sharing assistance that consumers receive from third parties to that consumer’s annual cost-sharing obligations.
  • On Nov. 25, CMS released its annual “Notice of Benefit and Payment Parameters” for 2022 health plans. While prior years’ versions of the NBPP have set out rules addressing health insurers’ use of accumulator adjusters, the current rule makes no mention of accumulators. The 395-page proposed rule does, however, include other major changes to the operations of state Marketplaces, coverage of essential health benefits, and more. HFA expects to file comments on the rule during the 30-day public comment period.
  • CMS issued a long-awaited final rule that gives states greater flexibility to set standards for Medicaid managed care plans, especially as relating to network adequacy, payment rates, plan oversight, and shortening the time periods for beneficiaries to appeal denials.The rule followed many of the recommendations from Medicaid directors and hospital groups who had complained that the landmark standards CMS put in place in 2016 were too burdensome and proscriptive.  Most of the changes will go into effect Dec. 14 despite the ongoing public health emergency.
  • Florida became the first state to seek federal approval for a plan to import certain prescription drugs from Canada. However, the state’s request for private bidders to operate their importation program has yet to receive any interest. Meanwhile, PhRMA filed suit against the U.S. Department of Health and Human Services to invalidate the drug importation rule.

 


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