Health Care Checkup: December 17, 2021

Health Care Checkup

December 17, 2021

THE BIG PICTURE

Congress averted a debt default on Wednesday by voting to raise the nation’s borrowing limit by $2.5 trillion, which should allow the federal government to continue borrowing to fund certain programs and continue operating until 2023—past the November 2022 elections. The House voted 221-209 to approve the debt limit increase and the Senate voted 50-49 to approve the measure. House Representative Adam Kinzinger (R-IL) was the only Republican to break ranks and vote with Democrats. President Joe Biden signed the joint resolution into law on Thursday. As a reminder, President Biden also signed a continuing resolution on December 3 to extend federal funding through February 18, 2022.

Last Friday, President Joe Biden signed a bill into law that will postpone Medicare payment cuts, which were slated to go into effect on January 1. The bill, the Protecting Medicare and American Farmers from Sequester Cuts Act, will postpone 2% cuts from Medicare sequestration until March 31, 2022. Beginning in April, the sequester cuts will be reduced to 1% until June 2022. PAYGO cuts will be postponed until 2023. Additionally, the 3.75% cut to physician payments under the Medicare PFS will be reduced to 0.75%. The bill also delays cuts to the clinical lab fee schedule and Medicare radiation oncology demonstration for one year.

While Senate Democrats had hoped to bring President Biden’s Build Back Better (BBB) initiative to the Senate floor this week, work is still underway in the Democratic caucus to come to a consensus. In addition, several Senate committees still need to meet with the Parliamentarian’s office to ensure that their portions of the legislation are in compliance with the Byrd Rule. Several substantive disagreements also remain, including over issues involving the size and scope of the child tax credit and deductions for state and local taxes. Most significantly, though, Senator Joe Manchin (D-WV) has yet to commit to voting in favor of the $1.7 trillion package. His concerns clearly were elevated by recent reports showing increasing inflation in many consumer goods and products. It is increasingly likely that the Senate passage of the BBB will slip until 2022. On Thursday, President Joe Biden acknowledged that a Senate vote on BBB will likely not happen until the new year, and said, “It takes time to finalize these agreements, prepare the legislative changes, and finish all the parliamentary and procedural steps needed to enable a Senate vote.” The version of the BBB that passes the Senate will almost certainly vary from what the House sent over in November, so the House will need to act again before the President signs it into law.

The Centers for Disease Control and Prevention (CDC) announced that individuals should opt for either Moderna or Pfizer’s COVID-19 vaccine over Johnson & Johnson’s COVID-19 vaccine (J&J), if the mRNA vaccines are available and accessible. The new recommendation came after clinical data found that a rare blood clotting disorder is more common among people who received the J&J vaccine than previously believed. The CDC made the decision based on the recommendation of its Advisory Committee on Immunization Practices (ACIP).

What to Expect Next Week: While both the House and Senate are scheduled to be in recess next week for the holidays, it is likely that Senate Democrats will continue their work and negotiations to advance the Build Back Better Act—even though that actual consideration will take place in 2022. After processing several nominations this week, the House and Senate are effectively out until the new year.

DEEP DIVE

Current State of Build Back Better

Over the weekend, the Senate HELP and Finance Committees released their pieces of the Build Back Better Act (BBB). The text released by the committees closely resembles the House’s version of BBB, but there are a few key changes. First, the Finance Committee eliminated the House’s provision to cut Medicaid Disproportionate Share Hospital payments in states that have not expanded Medicaid. In addition, the House’s provision that called for nursing home staffing requirements have also been taken out. Additionally, the new text provides Medicare Part D inflation rebate exemptions for certain generic drugs. The HELP Committee’s text can be found here and the Finance Committee’s text can be found here.

While Senate Democrats had hoped to bring BBB to the Senate floor this week, work is still underway in the caucus to come to a consensus. In addition, several Senate committees still need to meet with the Parliamentarian’s office to ensure that their portions of the legislation are in compliance with the Byrd Rule. In addition, Senator Joe Manchin (D-WV) has yet to commit to voting in favor of the $1.7 trillion package. It is increasingly likely that the Senate passage of the BBB will slip until 2022.

HHS Releases $9 Billion in Provider Relief Fund Payments

On Tuesday, the Department of Health and Human Services (HHS) announced it would release $9 billion in Provider Relief Fund (PRF) Phase 4 payments to help health care providers who have taken financial hits due to the COVID-19 pandemic. On average, payments to small providers will be around $58,000, for medium providers, payments will be around $289,000, and for large providers, payments will be approximately $1.7 million. More than 69,000 providers will receive the Phase 4 payments, which are scheduled to roll out at the end of the week. A state-by-state breakdown of the Phase 4 payments can be found here.

NHE Report Finds COVID-19 Had “Dramatic” Impact on Health Care Spending in 2020

The 2020 National Health Expenditures (NHE) Report, which is prepared by the Office of the Actuary at CMS, found that the COVID-19 pandemic drove up health care spending by 9.7% in 2020. CMS called this growth “dramatic,” and said that the growth brought national health care spending to $4.1 trillion in 2020. CMS attributes federal health care spending as the primary cause of the increased spending, which rose by 36% in 2020. The federal government spent $122 billion on the Provider Relief Fund, $53 billion on the Paycheck Protection Program, and $114.9 billion on public health investments such as COVID-19 testing and vaccine development. Additional highlights from the report can be found here.

MACPAC Releases 2021 Medicaid and CHIP Data Book

On Thursday, the Medicaid and Children’s Health Insurance Program (CHIP) Payment and Access Commission (MACPAC) released an updated Medicaid and CHIP data book, which includes new data on enrollment numbers, program spending, and access to care. The report found that in 2019, more than 25% of the U.S. population was enrolled in either Medicaid or CHIP for some portion of the year. Nearly 40% of the Medicaid and CHIP enrollees in 2019 had family incomes below 100% of the federal poverty level. Medicaid and CHIP accounted for 16.7% of national health expenditures in 2019, which was 4.4% less than Medicare and 14.8% less than private insurance. The entire MACPAC report can be accessed here.

Senate HELP Committee Holds Hearing to Consider FDA Commissioner Nominee Dr. Robert Califf

On Tuesday, the Senate HELP Committee held a hearing to consider the nomination of Dr. Robert Califf to be Commissioner of the U.S. Food and Drug Administration (FDA). Topics discussed at the hearing ranged from the opioid epidemic, to abortion, to the cost of prescription drugs. There was bipartisan support for Califf at the hearing, and it is expected that he will be confirmed in the new year. Senator Richard Burr (R-NC) noted, “I’m not sure you could write a resume of somebody more qualified to be considered for commissioner of the FDA.” MCRT’s summary of the hearing can be found here.