What the funding deal means for health care

Presented by PhRMA: Delivered daily by 10 a.m., Pulse examines the latest news in health care politics and policy.

Oct 02, 2023 View in browser   By Ben Leonard and Chelsea Cirruzzo Presented by Driving the Day The lights remain on in Congress after a down-to-the-wire continuing resolution to avert a shutdown was passed Saturday. | AP Photo SHUTDOWN AVERTED — Congress came together Saturday to secure a last-minute deal to continue government funding for 45 days and avoid a government shutdown, bucking the overwhelming consensus that a shutdown was inevitable. The “clean” stopgap measure — known as a continuing resolution — will keep government agencies like HHS running at current levels through Nov. 17. More than 200 House Democrats agreed to the patch, bailing out Republicans and House Speaker Kevin McCarthy, who were unable to unite on a deal to fund the government. What’s in the continuing resolution: The package sustains funding for community health centers and temporarily averts significant cuts that would impact safety-net hospitals, as POLITICO’s Robert King reports. Cuts for those hospitals, which serve a high share of Medicare and Medicaid patients, would be more than $8 billion. Obamacare provisions have long called for such cuts, but Congress has prevented them from happening. The deal will also: — Keep funding flowing for the National Health Service Corps and the Teaching Health Center Graduate Medical Education program — Extend the Special Diabetes Program and the Special Diabetes Programs for Indians — Extend the authority of the National Disaster Medical System to request federal workers be moved to support responses to public health emergencies What could have happened: HHS had warned that a shutdown could impact FDA inspections and force the agency to furlough nearly half its workforce. More than three-quarters of NIH staff would be furloughed, according to contingency plans. Community health centers, which serve patients regardless of their ability to pay, had feared a shutdown would force workers to leave for other jobs. Clinical trials and the Affordable Care Act Exchanges would still be able to run, though, and Medicare and Medicaid checks would continue to be sent. What’s next: It’s unclear what the path forward will be for lawmakers to agree on a long-term spending solution. Rep. Matt Gaetz (R-Fla.) vowed Sunday to boot McCarthy from his post for working with Democrats to fund the government. WELCOME TO MONDAY PULSE. Are there issues you want a long-term spending package to address? Reach us with tips, feedback and news at bleonard@politico.com or ccirruzzo@politico.com. Follow along @_BenLeonard_ and @ChelseaCirruzzo. TODAY ON OUR PULSE CHECK PODCAST, your host Ben talks with Robert King, who reports on how the Center for Medicare and Medicaid Innovation, created in 2010 to test ways to save Medicare money, has increased federal spending instead of reducing it. Listen to today’s Pulse Check podcast IN THE STATES Laphonza Butler, president of EMILY's List, has been selected to represent California in the U.S. Senate. | Araya Doheny/Getty Images WHILE YOU WERE SLEEPING — California Gov. Gavin Newsom will appoint EMILY’s List President Laphonza Butler to fill the seat of the late Sen. Dianne Feinstein, elevating the head of a fundraising juggernaut that works to elect Democratic women who support abortion rights, according to a person familiar with the decision.   A message from PhRMA: PBMs are siphoning money away from you.  They decide what you pay and what medicines you can get. PBMs steer you toward pharmacies they own that make them more money.  And, they’re creating new fees that pad their profits, but don’t benefit patients. Learn more.   Drug Pricing Novo Nordisk has joined other drugmakers like Merck and AbbVie in signaling it will negotiate Medicare drug prices. | Sergei Gapon/AFP/Getty Images ANOTHER DRUGMAKER AGREES TO NEGOTIATIONS — Novo Nordisk on Sunday said it will participate in Medicare drug price negotiations for several of its insulin products, POLITICO’s David Lim reports. That’s despite the firm being the latest to sue over the program. “While we do not believe the implementation of drug price negotiation provisions of the IRA is the right approach to help ensure patients living with diabetes can afford our insulins, we will comply with the law,” Novo Nordisk spokesperson Allison Schneider said in an email. AbbVie, Merck, AstraZeneca, Bristol-Myers Squibb and Boehringer Ingelheim have also signaled they’ll participate in the program. What’s to come: Drugmakers had until Sunday to agree to the negotiations and submit data on the chosen drugs by today. CMS will use that data to craft its initial price offer by Feb. 1, 2024. JUDGE: DRUG NEGOTIATIONS CAN PROCEED — A federal judge has denied business groups’ move to halt Medicare’s drug price negotiation program while lawsuits challenging its constitutionality move through legal challenges, POLITICO’s Lauren Gardner reports. The Friday decision by a Trump-appointed judge preserves the Biden administration’s power to negotiate the prices of 10 medications. Drugmakers that CMS chose for the first round of negotiations have until Oct. 1 to agree to the talks. “The Court is not convinced that granting Plaintiffs preliminary injunctive relief will protect them from imminent and irreparable harm," Newman wrote in his opinion. "Any economic harm — which, on its own, is insufficient to satisfy this prong of a preliminary injunction analysis — will not occur for years in the future.” A spokesperson for the U.S. Chamber of Commerce, which sought the injunction alongside state and local chambers of commerce, said the group is reviewing the decision. The judge asked the Chamber to amend its complaint to name which member companies would be affected by the program.   DOWNLOAD THE POLITICO APP: Stay in the know with the POLITICO mobile app, featuring timely political news, insights and analysis from the best journalists in the business. The sleek and navigable design offers a convenient way to access POLITICO's scoops and groundbreaking reporting. Don’t miss out on the app you can rely on for the news you need. DOWNLOAD FOR iOS – DOWNLOAD FOR ANDROID.     Lobby Watch WALKING THE LINE — The most powerful doctors group in the U.S. is trying to accomplish goals that are increasingly at odds — putting their voices in health policy at risk, POLITICO’s Daniel Payne reports. The American Medical Association is trying to navigate standing up for what its members see as important public health issues, from abortion access to gender-affirming care. Those stances make the group’s vital legislative goals more challenging as it tries to wrangle a bipartisan consensus on Medicare pay for physicians or how much say insurers have in what doctors do. Behind closed doors on the Hill, GOP staffers and lobbyists for other provider groups are noticing the public stances from the AMA — including those on structural racism, gun violence and climate change — and it has frayed relationships with conservatives. The AMA’s president said the group is committed to supporting evidence-based medicine in any case but disputed that it’s becoming less effective because of policies its members voted to approve. The group’s political action committee has continued to donate hundreds of thousands of dollars to candidates who’ve supported restrictions on abortion and gender-affirming care. But those donations aren’t enough to keep from alienating some Republicans. Republican lawmakers who are doctors, traditionally close allies of the AMA, have questioned the group’s credibility, though emphasizing they still agree with the group on important pocketbook and bipartisan policy issues. More conservative lawmakers see the rift as something more fundamental, especially as some policymakers get more comfortable tying longstanding programs to polarizing issues.   A message from PhRMA:   At the Agencies NEW FDA TEST PROPOSAL — The FDA has proposed subjecting most laboratory-developed tests to stricter review than it has in the past, David reports, regulating them as medical devices. Enforcement discretion would be phased out over several years. The agency says doing so would ensure tests are accurate and save billions of dollars annually. The tests are designed for many diseases. But the agency is concerned that its decadeslong practice of not enforcing certain regulatory requirements for such tests has led to a situation in which they don’t perform as well as diagnostic tests that undergo stricter review. The American Clinical Laboratory Association, which represents labs like Quest Diagnostics and LabCorp, said the proposed rule “exceeds FDA’s existing authority,” arguing the tests aren’t medical devices. The Laboratory Access and Benefits Coalition said it put “big lab and device companies” ahead of cancer patients. HHS WANTS INPUT ON OTC COVERAGE — HHS and the Departments of Treasury and Labor seek feedback on “the benefits” of mandating that many insurers cover over-the-counter preventive services at no cost and sans prescription. OTC products include those for contraception, smoking cessation, breastfeeding and folic acid for pregnancy. The agencies said many such items aren't required to be covered for free unless prescribed. The administration is taking comments for 60 days.   A NEW POLITICO PODCAST: POLITICO Tech is an authoritative insider briefing on the politics and policy of technology. From crypto and the metaverse to cybersecurity and AI, we explore the who, what and how of policy shaping future industries. We’re kicking off with a series exploring darknet marketplaces, the virtual platforms that enable actors from all corners of the online world to traffic illicit goods. As malware and cybercrime attacks become increasingly frequent, regulators and law enforcement agencies work different angles to shut these platforms down, but new, often more unassailable marketplaces pop up. SUBSCRIBE AND START LISTENING TODAY.     WHAT WE'RE READING KFF Health News reports on hospitals in Appalachia that make significant promises to get a monopoly but fail to deliver. STAT reports on how late Sen. Dianne Feinstein’s (D-Calif.) bout of shingles reflects a rise in cases. CNN reports on a contract for tens of thousands of Kaiser Permanente workers expiring, meaning a strike could start this week.   A message from PhRMA: Health insurers and PBMs can refuse to share savings that should go to you. Now they’ve got another trick. A new report shows  PBMs found new ways to profit off your prescriptions. They’ve doubled the amount of fees they charge on medicines in the commercial market. They tie these fees to the price of medicines. And experts warn this can lead PBMs to cover medicines with higher prices instead of lower-cost options.      Follow us on Twitter Dan Goldberg @dancgoldberg Chelsea Cirruzzo @chelseacirruzzo Katherine Ellen Foley @katherineefoley Lauren Gardner @Gardner_LM Kelly Hooper @kelhoops Robert King @rking_19 Ben Leonard @_BenLeonard_ David Lim @davidalim Megan Messerly @meganmesserly Alice Miranda Ollstein @aliceollstein Carmen Paun @carmenpaun Daniel Payne @_daniel_payne Evan Peng @thepngfile Ruth Reader @RuthReader Erin Schumaker @erinlschumaker Megan R. Wilson @misswilson   Follow us

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