Medicare Advantage insurers appeal to the Hill

Nov 11, 2024

Presented by The Campaign for Sustainable Rx Pricing

Driving the Day

The Medicare website is seen on a computer screen.

Insurers are pushing back on the Biden administration's Medicare Advantage payment rates. | Rachel Leathe/AP

INSURERS PUSH FOR AN MA FIX — Medicare Advantage insurers are gearing up to convince lawmakers that the Biden administration’s policies have been detrimental to older Americans enrolled in the privately run alternative to Medicare, POLITICO’s Kelly Hooper reports.

When Congress returns to Capitol Hill on Tuesday, the Medicare Advantage industry will use data on this year’s plan offerings and stories about older adults facing disruptions in care to convince lawmakers to boost funding for private health insurers.

Why it matters: The push comes after insurers have complained for months about what they call an insufficient payment rate from the federal government for 2025. The lower-than-expected pay rate — coinciding with increased medical costs among older adults — has led insurers to scale back supplemental benefits, such as transportation and meal perks, and pull out of plans in dozens of counties.

Insurer-backed advocacy group Better Medicare Alliance plans to use data from consulting firm Avalere to demonstrate to lawmakers the “significant shrinkage” of benefits that older adults are seeing this year, Rebecca Buck, the senior vice president of communications at BMA, said.

“We really want to stress that there has been a lot happening with Medicare Advantage, and now we’re seeing the real-world impacts of that,” she said.

Key context: The Better Medicare Alliance’s planned efforts mirror the seven-figure campaign that AHIP, the leading trade group for health insurers, launched earlier this fall to convince lawmakers to protect MA and push for a more favorable rate notice.

“Seniors have been active this fall ensuring policymakers of both parties understand how much they value the better care at lower costs that they receive through Medicare Advantage,” said Chris Bond, an AHIP spokesperson. “Two consecutive years of cuts to MA are now harming millions of seniors’ coverage options and affordability — and we expect elected officials will continue hearing a very clear and direct message from seniors: Keep the bipartisan promise to protect Medicare Advantage.”

WELCOME TO MONDAY PULSE. New research may explain why some people sleep better after using cannabis and others don’t. A study published in Addiction found that in young people with preexisting depression and anxiety, cannabis can improve sleep. But those without such preexisting conditions experienced worse sleep. Send your tips, scoops and feedback to ccirruzzo@politico.com and bleonard@politico.com and follow along @ChelseaCirruzzo and @_BenLeonard_.

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Big Pharma games the system to keep prescription drug prices high. Brand name drug companies build blockades of patents to extend monopolies and block competition from more affordable alternatives – costing patients, taxpayers and the U.S. health care system billions of dollars each year. Market-based solutions to hold Big Pharma accountable for their egregious anti-competitive tactics, especially patent thickets, have broad bipartisan support. Congress must pass these solutions into law. Learn more.

In Congress

Rep. Bob Latta (R-Ohio).

In a bid for the House E&C chair, Ohio Republican Bob Latta promises a leadership with "no surprises." | Rod Lamkey for POLITICO

LATTA’S E&C PITCH — Rep. Bob Latta (R-Ohio), who’s vying to be the next chair of the House Energy and Commerce Committee, pitches himself as someone who won’t govern from the top down, Ben reports.

“Everyone has their own style. I’m a firm believer of making sure all the committee members are in the process,” Latta told Ben. “No surprises. Everybody will know what’s going on and have their input, including subcommittees. Good ideas don’t just emanate from the top.”

Latta, who chairs E&C’s Communications and Technology Subcommittee, is running against Rep. Brett Guthrie (R-Ky.). Rep. Richard Hudson (R-N.C.), who had weighed a bid for E&C chair, said Sunday he will seek another term as National Republican Congressional Committee chair instead.

His agenda includes removing roadblocks to innovation in the U.S., bolstering transparency in the health care sector through the Lower Costs, More Transparency Act and bolstering domestic production of critical medical products.

President-elect Donald Trump has pitched tariffs to boost domestic industry generally. Latta doesn’t necessarily think tariffs are the solution to onshoring, though, at least in the health care sector.

“We’ve got a lot of our drugs being manufactured overseas. It’s important to bring them back. I’m not sure if it’s really a tariff issue,” Latta said.

He also sees federal agencies like the FDA and the CDC as ripe for oversight.

“We want these agencies and departments to be responsible and responsive to us,” Latta said. “There’s a lot of flawed messaging out there,” referring to a recent committee report on HHS’ Covid-19 messaging.

Read more of Ben’s interview with Latta, including his thoughts on the Inflation Reduction Act’s future, Robert F. Kennedy Jr. and more.

DECISION TIME FOR SOCIAL MEDIA BILL — A Senate-backed bill to regulate social media that would help shield kids online faces divided chances in the House with Democrats and Republicans in disagreement over changes made to it, POLITICO’s Ruth Reader reports.

How we got here: The Kids Online Safety and Privacy Act, sponsored by Sen. Richard Blumenthal (D-Conn.), is meant to protect children from the mental health harms the apps are widely agreed to cause. It passed the Senate 91-3 in July.

But the probability that Republicans will run the next Congress doesn’t bode well for enactment.

What’s inside the bill: The Senate bill requires social media companies to protect children’s privacy and shield them from targeted advertising and manipulative algorithms.

In September, however, the House Energy and Commerce Committee took up its version of the bill and made changes that advocates said weakened it. The Republican-led panel advanced it despite diverging concerns from Democrats and Republicans.

Why it matters: Three years ago, Frances Haugen, a former Facebook employee, told senators the company had internal data showing large percentages of teens using its photo-sharing app Instagram experienced negative self-perceptions, anxiety and depression.

What’s next? Advocacy groups plan to enlist the bill’s backers in the Senate to pressure their House counterparts when Congress returns.

If Congress doesn’t act this year, the bill’s advocates must reintroduce legislation. President-elect Donald Trump could help revive the legislation or end the discussion. He hasn’t said what he wants to do.

FISCAL YEAR IN REVIEW — The federal budget deficit increased 8 percent, or $138 billion, in fiscal 2024 — with Medicare and Medicaid seeing increases.

According to a review of fiscal 2024 by the Congressional Budget Office, Medicare outlays rose $78 billion, or 9 percent, because of higher enrollment and payment rates for services.

Medicaid outlays also rose but on a smaller scale: $2 billion, or less than 1 percent, even as states revisited who was eligible for Medicaid.

“Despite millions of disenrollments during the period in which states reassessed eligibility, Medicaid outlays rose in 2024 because per-person costs for enrollees remaining on Medicaid were greater in 2024 than they were in 2023,” the CBO said.

What’s next? Congress must still pass a budget for next year by Dec. 20. Republican-backed proposals in the House include significant cuts to HHS, mainly focused on the CDC.

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AROUND THE AGENCIES

FIGHT OR FLIGHT? Some federal bureaucrats — including those at the NIH and the CDC — aren’t sure whether to stick around for a second Donald Trump administration.

The alarm over Trump’s return is particularly palpable among the federal health agencies , who fear the president-elect will follow through on his pledge to let noted vaccine skeptic Robert F. Kennedy Jr. “go wild on health,” POLITICO’s Chelsea, Nahal Toosi, David Lim, Lauren Gardner, Sophie Gardner, Joseph Gedeon, Alice Miranda Ollstein and Chris Marquette report.

Inside the agencies: One staffer, granted anonymity to speak freely, at the NIH said concerns are building inside the research agency about the future of vaccine research in the next administration.

A former FDA official, also granted anonymity, told POLITICO on Wednesday that RFK Jr.’s assertions that he would have heavy influence over health agencies during Trump's second term raise the risk of career staff departing the agency responsible for drug oversight and food safety.

“The agency personnel are concerned, especially in light of Robert F. Kennedy Jr.’s statements and his potential role at the agency,” said the former official. "The reality of that is something the agency has to grapple with.”

CDC staffers also fear that under Trump the public health agency — so central to the Covid-19 response — has “a target on its back,” as one person who works with the agency said under anonymity.

Republicans have outlined clear plans for changes to the CDC — including the Heritage Foundation’s Project 2025, which recommends splitting up the agency . The Trump campaign has insisted that Project 2025 isn’t its official policy.

And many conservatives, including Trump’s former FDA Commissioner Scott Gottlieb, have argued that the CDC should narrow its scope to focus mainly on disease control.

Karoline Leavitt, spokesperson for the Trump-Vance transition, didn’t reply directly to a query about the future of the federal workforce, saying via email, “President-Elect Trump will begin making decisions on who will serve in his second Administration soon.”

WHAT WE'RE READING

STAT reports on how providers who offer gender-affirming care are preparing for a second Trump term.

The New York Times reports on how Americans across numerous states voted on tougher drug penalties.

Reuters reports that Canada has confirmed its first presumptive bird flu case in a human.

A message from The Campaign for Sustainable Rx Pricing:

Big Pharma's abuse of the patent system is designed to maintain monopolies over their biggest money-makers, boosting brand name drug makers’ profits at the expense of American patients and taxpayers. One of their anti-competitive tactics involves filing dozens, sometimes hundreds, of patents on blockbuster products to build extensive “patent thickets,” completely disconnected from any true innovation. An economic analysis found Big Pharma’s patent thickets on just five drugs cost American patients and the U.S. health care system more than $16 billion in a single year.

The Congressional Budget Office has confirmed bipartisan, market-based solutions to hold Big Pharma accountable for patent abuse will lower drug prices and the U.S. Senate unanimously passed one solution, Cornyn-Blumenthal (S.150), earlier this year. Now is the time for Congress to finish the job – and pass solutions to lower drug prices by cracking down on patent abuse and promoting competition. Learn more.