What GOP Plan For Health Care Reform May Mean For You?

The House GOP Health Care Reform Plan provides a blueprint for eliminating important elements of the ACA and replacing them with a more market-oriented approach.

On Wednesday key Capitol Hill committees started debate on the controversial new Health Care legislation

Both President Trump and the House GOP plan contemplate using tax credits to subsidize the purchase of health insurance.

Hearings on the “American Health Care Act” (AHCA) stretched overnight at the House Ways and Means Committee and Energy and Commerce Committee. Ways and Means approved its portion of the AHCA at around 4 a.m. on Thursday, while discussion continued at Energy and Commerce

While partial details on the AHCA’s costs are available, the Congressional Budget Office hasn’t yet estimated how the AHCA would affect the uninsured rate or how much it would cost overall. CBO would not have a “score” — a report on the effects of the bill — before next week, when the measure could go to the Budget Committee.

The Plan has not yet been analyzed by the Congressional Budget Office, so it is unknown how much the plan will cost and what its impact will be on the number of people who are insured. Additionally, despite the Republican majority in the Senate, it is unclear whether all the Republican senators will support the bill.

It is far from clear, however, whether the Medicaid provisions of the House GOP plan have sufficient support to pass the Senate. Four GOP senators recently warned that they would not support any plan that does not protect the Medicaid expansion population. Moreover, in his speech last week, President Trump argued that Congress should give governors the “resources and flexibility with Medicaid to make sure no one is left out.” It is not clear what Trump meant by this statement and whether he supports the House GOP plan’s Medicaid changes could very well cause some people to lose coverage.

One way of shedding light on what a final law may look like is to look at its putative winners and losers. Although it is hard to assess the ultimate impact of health care reform until more details emerge, what’s now known suggests that particular subsectors of the industry could be winners or losers:

1. Hospitals:

To the extent health care reform results in significantly more uninsured patients, hospitals will likely bear increased costs. Because hospitals often treat patients regardless of ability to pay, more uninsured patients means increased charity care and bad debt write-offs. This burden would fall heavily on disproportionate share hospitals (DSH) — hospitals that treat a large percentage of the indigent population. The ACA had reduced government funding to DSH hospitals under the theory that they would offer less uncompensated care as the number of uninsured people drops. The House GOP plan would benefit DSH hospitals by repealing the ACA’s funding cuts.

2. Pharmaceutical Industry:

The plans contemplated by the Trump administration and House GOP will have a mixed impact on the pharmaceutical industry.

The ACA reflected a complex bargain between the Obama administration and the pharmaceutical industry. The pharmaceutical industry benefited from more insured people who could afford to purchase more drugs. It also benefited from the closing of the “doughnut hole,” the coverage gap between an initial threshold of drug costs that would be covered by Medicare Part D and a much higher catastrophic maximum after which Part D coverage would resume. In return, the branded pharmaceutical industry agreed to an annual tax of about $3 billion (allocated among branded pharmaceutical companies based on their share of the branded pharmaceutical market) and cutbacks on Medicaid reimbursements for prescription drugs.

The House GOP plan partially unwinds this bargain. The plan benefits the pharmaceutical industry by repealing the $3 billion annual tax and maintaining the closure of the doughnut hole. Additionally, repealing the “medicine cabinet tax” may boost the sale of over the counter drugs. But the pharmaceutical industry will lose to the extent that people reduce purchases of prescription drugs because they lose their health insurance or are covered by plans that provide only limited coverage for expensive drugs, even while the ACA’s cutbacks on Medicaid rebates are left intact.

3. Medical Device Manufacturers:

Health care reform will likely be a major boon to device manufacturers because there is strong GOP support for lifting the excise tax on devices. Device manufacturers may also benefit from greater flexibility in patients’ ability to use HSA money on devices that would not typically be covered by insurance. That being said, device manufacturers may suffer lost sales to the extent people lose insurance coverage or purchase only thin coverage that leads them unable to afford certain devices.

While the House GOP plan reflects the bill that the House GOP leadership would like to pass, it is likely to be just the start of a heated health care reform debate. Different health care industry subsectors may yet have a significant role in shaping whatever bill, if any, ultimately passes in Congress and is signed by the President.

Republican leaders have emphasized that the objective of the law is to lower the cost of coverage and reduce government mandates, not necessarily to increase or even maintain the number of people covered.

One thing remains clear: the changes contemplated by the Trump administration and congressional Republicans are likely to have significant implications for just about every sector of the health care industry.

Republicans hope to send the AHCA to the full House within the next month.

This week in Congress.

The Senate will consider resolutions of disapproval under the Congressional Review Act (CRA) and confirmation of the president’s appointees to federal agencies. The House will be taking up litigation reform legislation and appropriations legislation to fund the Defense Department through the remainder of fiscal year 2017. The highest profile activity in Congress this week, though, is expected to take place in the House which plans to mark up the legislation to begin to repeal and replace the Affordable Care Act.

The Senate will return on Monday afternoon, when votes are expected on two resolutions of disapproval of federal regulations issued in the final months of the Obama administration under the CRA. The first vote will be on H.J. Res. 37 to disapprove a rule from the Department of Defense, the General Services Administration, and the National Aeronautics and Space Administration revising provisions of the Federal Acquisition Regulation to require federal contractors to disclose findings of noncompliance with labor laws. The Senate is then scheduled to vote on the motion to proceed to H.J.Res 44, a resolution of disapproval of the Bureau of Land Management’s Resource Management Planning rule, finalized in December 2016. The regulation establishes the procedures used to prepare, revise or amend land use plans pursuant to the Federal Land Policy and Management Act of 1976, but congressional Republicans, state and local governments, and affected property owners have argued that the new process creates more confusion and greater uncertainty. The White House has announced support for both resolutions of disapproval, indicating the president would sign them into law upon Senate passage (both resolutions have already been approved by the House).

Senate floor activity for the remainder of the week is uncertain. It is possible the majority leader will initiate action on the nomination of Seema Verma to serve as Administrator of the Centers for Medicare and Medicaid Services. The nomination was advanced by the Senate Finance Committee last Thursday on a straight party-line vote.

On the other side of the Capitol, the House will return to legislative business on Tuesday, when members will consider seven bills, including five measures under the jurisdiction of the Transportation and Infrastructure Committee, under suspension of the rules.

On Wednesday, House members will consider three additional bills under suspension of the rules, all reported by the Natural Resources Committee.

The House will then take up H.R. 1301, the Department of Defense Appropriations Act for FY 2017, subject to a rule. The funding bill would replace the Department of Defense provisions of the current continuing resolution for FY 2017, which is set to expire on April 28, and provide funding through the end of this fiscal year, which ends on Sept. 30. The legislation meets the overall defense spending limits set by law for FY 2017, providing $516.1 billion for base budget needs. The bill also provides $61.8 billion in Overseas Contingency Operations funding, which is the level allowed under current law. These amounts are also in line with the National Defense Authorization Act signed into law by President Obama in December. Unlike the Defense Appropriations bill that passed the House on a party-line vote last summer, this version of the defense spending bill maintains statutory budget limits. As a result, it is likely to garner more bipartisan support for House passage in this session of Congress. Press reports indicate the Trump administration is preparing to request an additional $30 billion in supplemental funding for the Department of Defense in FY 2017, largely for readiness spending, but it remains unclear how Congress will respond to any supplemental appropriations request. It also remains unclear how or when Congress will deal with funding for the 10 remaining FY 2017 spending bills before the continuing resolution expires on April 28.

During the remainder of the week, House members will consider three pieces of litigation reform legislation reported out of the House Judiciary Committee. Each will come to the floor under a rule.

On Thursday, the House will take up two of these measures. H.R. 725, the Innocent Party Protection Act, limits the ability of federal courts to remand cases to state court under certain circumstances. Members will also consider H.R. 985, the Fairness in Class Action Litigation Act of 2017. The bill includes language from a previous class action reform proposal, which passed the House in 2016, to prohibit federal courts from certifying any proposed class under Rule 23 of the Federal Rules of Civil Procedure unless the party seeking to maintain a class action demonstrates that each member of the proposed class suffered an injury of the same type and scope. This version of the legislation also includes some additional provisions related to class action litigation, including disclosure requirements on third-party litigation financing.

The third litigation reform bill will be considered on Friday. H.R. 720, the Lawsuit Abuse Reduction Act of 2017, would amend Rule 11 of the Federal Rules of Civil Procedure to make the imposition of sanctions for violations of the rule mandatory, not discretionary as under current law.

Also this week, House Republican leaders are expected to release their proposal to repeal and replace the Affordable Care Act.  Once the bill is released, committee action is on tap, with markups this week, and prompt floor action can be expected as early as next week.

With all committees now organized, both chambers are facing busy hearing schedules.


Senate Panel Sends $164M Health, Labor Funding Bill To Floor

Yesterday, the U.S. Senate Committee on Appropriations sent a $164 billion funding bill to the Senate floor that would increase money for health care research; restore year-round grants available to college students and work to fight opioid addiction.

The first bipartisan bill to fund the U.S. Department of Labor and the U.S. Department of Health and Human Services in seven years passed the committee by a 29-1 vote.

The Bill would provide $162 billion in base spending, about $270 million less than last year’s amount and $2 billion less than President Barack Obama requested. It also includes $2 billion in cap adjustment funding that aims to prevent waste, fraud, abuse and improper payments in the Social Security, Medicare and Medicaid programs.

Specifically, the bill would eliminate 18 duplicitous or unnecessary federal programs in addition to the 18 eliminated by last year’s funding bill, and provide $34 billion to the NIH, an increase of $2 billion. In all, the U.S. Department of Health and Human Services would get $76.9 billion, an increase of $1.4 billion, under the bill. It also would provide $126 million more to combat opioid abuse, an increase of 93 percent.

Those increases come at the expense of other programs, with $117 million cut from after-school programs, $74 million cut from workforce training grants to states and $118 million cut from the Centers for Disease Control and Prevention. Nevertheless, earned broad bipartisan support.

Both Republicans and Democrats lauded the restoration of year-round Pell grants for more than 1 million students nationwide, a measure that Sen. Patty Murray, D-Wa., the subcommittee’s ranking member, included in the bill.

The bill would provide students with, on average, an extra $1,650 to help pay for college accrding to the legislative statements.

The bill wouldn’t provide new funding for Affordable Care Act measures, but would continue prohibitions that aim to stop the administration from using discretionary funding to prop up the ACA’s risk corridor program, which collects contributions from insurers with lower risk enrollees and transfers them to those with higher risk ones.

Hospitals avoid new local-tax burden-Energy and Environment Bills Signed Into Law

New Jersey Governor Chris Christie vetoed a bipartisan proposal that would have required nonprofit hospitals to pay new fees to municipal governments to help cover the cost of police, fire, and other local services in exchange for maintaining the property-tax exemption they have long enjoyed. The bill was prompted by a landmark state tax-court ruling in 2014 that successfully challenged the property-tax exemption enjoyed by nonprofit Morristown Medical Center, given that it also operates several for-profit services at the same Morris County site.

The pocket veto encourages uncertainty where the bill could have secured the legal future of hospitals. Legislators intended their efforts to avoid similar lawsuits around the state, but with the veto the state may see an untimely increase in litigation.

The move was more of a disappointment than a surprise, legislators said.

Energy and Environment Bills Signed Into Law

S-2617/A-3944 (Cardinale/Garcia, McKeon, Auth, Eustace, Pinkin) – Requires DEP to adopt regulations to allow cultivation of commercial shellfish species in certain coastal and inner harbor waters for research, educational, or restoration purposes; requires community engagement process for revision thereof

S-2880/A-4704 (Lesniak, T. Kean/Diegnan, Wisniewski) – Provides up to $25 million in tax credits under Economic Redevelopment and Growth Grant Program for certain infrastructure at Rutgers, the State University of New Jersey

S-3321/A-4927 (Smith, Van Drew, Bateman/Spencer, Rumana) – Authorizes DEP to require public access to waterfront and adjacent shoreline as condition of waterfront development approvals and CAFRA permits

A-1726wGR/S-308 (Eustace, Lagana, Mosquera, Vainieri Huttle, Wimberly/Gordon) – Amends “Flood Hazard Area Control Act” to require DEP to take certain actions concerning delineations of flood hazard areas and floodplains

A-1812/S-2717 (Mosquera, Mazzeo, Andrzejczak/Cruz-Perez, Oroho, Jones) – Extends protections of the new vehicle “lemon law” to new farm tractors purchased or leased in New Jersey

A-1958/S-1848 (Allen, Van Drew) – Concerns exemptions from permits for certain agricultural activities under “Freshwater Wetlands Protection Act”

A-2839/S-2620 (Burzichelli, Space, Phoebus/Oroho, Turner) – “New Jersey Rural Microenterprise Act”

A-3257wGR/S-2125 (Andrzejczak, Mazzeo, Burzichelli/Van Drew) – Provides that determination by county agriculture development board or State Agriculture Development Committee as to what qualifies as farm-based recreational activity in pinelands protection area is binding on Pinelands Commission

A-3850/S-2467 (DeAngelo, Eustace, Mazzeo, Pintor Marin, Benson/Turner, Singer) – Requires BPU to establish procedures allowing electric power and gas supplier customers to switch energy suppliers

Energy and Environment Bills  pocket vetoed

S-564/A-4186 (Smith, Bateman/Eustace, McKeon, Spencer, Benson) – Establishes “Solar Roof Installation Warranty Program” in EDA and transfers $2 million from societal benefits charge to initially fund program

S-1414/A-2405 (Smith, Bateman/Eustace, Benson, Johnson) – Concerns low emission and zero emission vehicles; establishes Clean Vehicle Task Force

SCS for S-1420/ACS for A-1603 (Beach, Whelan, Smith, Sweeney, Bateman, Thompson/Spencer, Eustace, Quijano, Wimberly) – Requires paint producers to implement or participate in paint stewardship program

S-2491/A-4069 (Smith/Danielsen, Pinkin, Benson) – Establishes position of State Oceanographer

S-2711/A-4128 (Smith, Whelan/Mazzeo, DeAngelo, Spencer, Singleton, McKeon, Danielsen, Johnson) –Permits BPU to approve qualified wind energy project; requires BPU to provide application periods for those projects

S-2769/AS for ACS for A-4197, 4206 (Smith, Bateman/Andrzejczak, McKeon, Spencer, Pintor Marin, Dancer, Vainieri Huttle) – Implements 2014 constitutional dedication of CBT revenues for certain environmental purposes; revises State’s open space, farmland, and historic preservation programs

S-3416/A-4808 (Lesniak, Sarlo/Eustace, Gusciora) – Prohibits possession, transport, import, export, processing, sale, or shipment of parts and products of certain animal species threatened with extinction

A-2586/S-1796 (DeAngelo, Quijano, Benson/Greenstein) – Establishes “Energy Infrastructure Study Commission”

A-4384/S-3145 (DeAngelo, Pintor Marin, Danielsen, Schaer, Johnson/Whelan) – Requires BPU to render decision on case within 12 months of final public hearing or hold another public hearing prior to deciding case

A-4763/SS for SCS for S-2973 (McKeon, Spencer, Pinkin/Smith, Bateman, Greenstein, Codey) – Revises “Electronic Waste Management Act”

A-4773/S-3146 (Eustace, Garcia, Gusciora/Lesniak) – Prohibits possession and transport of parts and products of certain animals at PANYNJ airports and port facilities


Out-of-network legislation clears Assembly committee

The New Jersey state Assembly bills to address surprise out-of-network hospital bills are one step closer to becoming law, despite some remaining concerns for both payers and providers.

The two bills, sponsored by Assembly Democrats Craig Coughlin (D-Woodbridge), Gary S. Schaer (D-Passaic), Troy Singleton (D-Mount Laurel), Pamela Lampitt (D-Voorhees) and Grace Spencer (D-Newark), cleared the Financial Institutions and Insurance Committee on Monday.

Originally introduced earlier this year as a single bill, the two new pieces of legislation cover changes in the administrative process for hospitals during non-emergency procedures, as well as creating a new transparency tool to determine what providers are charging for care — known as the Health Price Index. If enacted, the out-of-network bill would rely on the state Department of Banking and Insurance to find an organization to collect and maintain the Health Price Index.

The out-of-network bill, which is similar to a bill making its way through the Senate, is raising concerns about the increased burden on health care professionals, while the creation of a new price tool is likely to increase the already too-high-cost of insurance plans.

The New Jersey Business and Industry Association supported the out-of-network bill, but has some concerns about the HPI.

“NJBIA continues to oppose creation of an HPI,” testified Mary Beaumont, vice president for health and legal affairs.  “Surcharges on health insurers and benefits plans will ultimately increase health care costs for New Jersey employers. Furthermore, it’s duplicative. Existing sources collect and provide in-network and out-of-network cost information from physicians, hospitals, health care facilities and insurers.”

Similar opposition can also be seen for the administrative burden on doctors from the out-of-network bill.

But the bills’ sponsor believes the physicians and health care professionals within the health system should be responsible for tracking the insurance information. Laws already exist for emergency situations to be treated as in-network, so elective procedures are typically where surprise bills appear.

“If they were given the choice between continuing with medical care that ultimately would lead to substantial out-of-pocket costs and considering other options that carry a lower price tag, the vast majority of reasonable New Jersey residents certainly would choose the latter. The problem, at present, is that they don’t have that choice,” said Schaer.

Sen. Joseph Vitale, who heads the health committee and reviewed a similar bill, applauded the Assembly bill.

“Along with my Assembly counterparts sponsoring the bill, I am now confident that we have a piece of legislation that will advance through both houses before the end of this legislative session,” Vitale (D-Woodbridge) said in a statement. “People are being forced to choose between paying off medical bills that they never expected to receive or paying their necessary everyday expenses like rent, mortgage and food. It’s not a fair choice to have to make. New Jersey consumers need to know what they’re getting into, before non-emergent out-of-network medical services are provided, so they can make informed choices rather than being arm-wrestled into damaging debt.”

The bills call for the following to be implemented by health care facilities:

  • Disclose whether the facility is in- or out-of-network.
  • Advise the patient to check with the doctor arranging the services to determine whether or not the doctor is in- or out-of-network.
  • Advise the patient if a change in network status has occurred between the time the appointment was made and the time of the procedure.
  • Advise that the patient contact his or her insurance carrier for further consultation regarding costs.
  • Make publicly available a list of standard charges for the items and services it provides
  • Follow a binding arbitration process to allow consumers a chance to fight surprise bills
  • Publish online the names, mailing addresses and telephone numbers of physicians working at the facility and hospital-based physician groups with which it has contracted to provide services, including anesthesiology, pathology and radiology.

The New Jersey Association of Health Plans released a statement supporting various aspects of the bill, but stated concerns with the peer review process, cost sharing for emergency services and the $1,000 threshold for arbitration — all of which were urged by hospitals and health care providers.

“We believe that the peer review process will add cost and prove to be of limited utility, as it is not likely to provide information not already available to the disputing parties.  We are also concerned about our experience with peer-review process, as we have seen that providers are reluctant to challenge their peers.  As a result, we do not support the proposal,” NJAHP said in the statement.

“While we continue to have concerns about a number of elements of the bill, especially the network audit section, which we see as redundant of existing regulatory requirements, overall, we are supportive of the bill.  Consumers, labor organizations, businesses, the State Health Benefits Program and other payers will benefit from the bill’s transparency measures and cost containment measures. It is time to put a stop to surprise bills for consumers and reign in the predatory price gouging practices by certain provider.”

Martin J. Milita, Jr. Esq., is senior director at Duane Morris Government Strategies, LLC.

Duane Morris Government Strategies (DMGS) supports the growth of organizations, companies, communities and economies through a suite of government and business consulting services. The firm offers a range of government relations and public affairs services, including lobbying, grant writing; development finance consulting, media relations management, grassroots campaigning and community outreach. Milita works at the firm’s Trenton and Newark New Jersey offices.

Visit his blog at: https://martinmilita1.wordpress.com

Follow him on twitter: @MartinMilita1




Martin Milita – About.me

Martin Milita :: Pinterest

Martin Milita @ Twitter

Martin Milita at Slideshare

Martin Milita on Google+

Martin Milita Yola Site

Martin Milita | Xing

This Week In Congress: National Security & Health Care

By: Martin J. Milita, Jr. Esq.

This week the Senate is focused on national security issues. It will attempt to complete work on the National Defense Authorization Act (NDAA) and begin consideration of the fiscal year 2016 defense appropriations bill. On the other side of the Capitol, the House is expected to take action on a number of health care-related bills, even while Congress and the president await the Supreme Court’s impending ruling in King v. Burwell, regarding subsidies for health insurance under the Affordable Care Act.

The Senate is scheduled to return today, with votes expected on two noncontroversial nominations. Following these votes, the Senate will resume consideration of the NDAA. Majority Leader Mitch McConnell, R-Ky., filed a motion on Thursday to invoke cloture and cut off debate on the bill. The cloture vote is expected on Tuesday morning. Needing the support of 60 senators in order to be successful, the cloture vote is not guaranteed to pass easily on Tuesday, because Senate Democrats have pledged to block the bill over the inclusion of funds for U.S. Department of Defense activities that exceed the spending limits established by the 2011 sequester. The NDAA provides an additional $38 billion in funding for the Pentagon through the Overseas Contingency Operations (OCO) account, an account for war-related expenses which is exempt from discretionary caps. Democrats call the move a budgeting gimmick and have tried unsuccessfully to alter the spending framework. Last Tuesday the Senate rejected (46-51) an amendment offered by Senate Armed Services Committee Ranking Member Jack Reed, D-R.I., to block the additional $38 billion in OCO funding until Congress lifts the sequester. If cloture is invoked on Tuesday, the Senate will have 30 hours to complete work on the NDAA. The amendment process moving forward is unclear, because more than 100 amendments have been filed to the bill, but bill managers do not seem to have an agreement in place on the amendments that will be considered. Senate Armed Services Committee Chairman John McCain, R-Ariz., indicated to reporters last week that the Senate will consider at least two amendments following the cloture vote on Tuesday.

The debate over defense funding and sequestration levels will continue after work on the NDAA is wrapped up. Consideration of the FY 2016 Defense Appropriations bill is expected to be the next bill on the Senate agenda. On Thursday, the Senate Appropriations Committee approved its version of the $576 billion defense spending bill. While only three Democratic committee members opposed the bill at the markup, Democratic leaders have pledged to block any vote to begin considering the 2016 defense appropriations bill on the floor as long as it contains the OCO funds for the Department of Defense, while the other appropriations bills are capped at sequester levels. Senate Minority Leader Harry Reid, D-Nev., last week told reporters that a government shutdown is already looming if congressional Republicans do not negotiate a new budget framework for FY 2016 that lifts the spending caps. President Obama has also threatened to veto the appropriations bills at their current levels. So far, Republican leadership has not indicated a willingness to agree to a budget summit, but neither chamber would have the necessary votes to overcome a presidential veto on any of the appropriations bills.

Consideration of the Cybersecurity Information Sharing Act in the Senate is also possible later this week. Majority Leader McConnell tried unsuccessfully to attach the measure as an amendment to the NDAA last week, but his effort was met with resistance from Senate Democrats who want to take up the bill independently and offer amendments. The legislation would encourage greater sharing of cyber-threat information between the private sector and government by offering companies expanded liability protections. The measure has bipartisan support, especially in light of the recent high-profile data breaches, and similar legislation passed the House of Representatives in April.

The House will return on Monday and consider several bills naming post offices and other federal facilities, along with a resolution calling on Iran to release the Americans it is holding. The main legislative work starts on Tuesday, when the House tackles the Intelligence Authorization Act, which authorizes a variety of intelligence, cybersecurity and anti-terrorism programs. The legislation had been scheduled for last week but was displaced by Friday’s vote on the so-called “fast-track” trade legislation. That legislation too is likely to return to the House floor early this week. On Friday, two of the three elements of the bill were approved by the House in separate votes. A third component of the bill, however, to reauthorize the Trade Adjustment Assistance program, was defeated. Under the rule, however, all three elements of the bill had to be approved for the entire package to get adopted. After the defeat of the TAA portion of the package, the Majority Leader moved to reconsider that vote, and the House is likely to take up that motion early in the week.

The House will spend the remainder of the week on health care-related legislation, including measures that would repeal two contentious provisions of the Affordable Care Act. The first four of these health care-related bills will be considered under suspension of the rules. The bigger debates will follow on the other two bills. Reported out of the House Ways and Means Committee, the first bill would repeal the 2.3 percent excise tax on medical device manufacturers that was included in the Affordable Care Act as a revenue source to help pay for the law’s implementation. A second bill would repeal the controversial Independent Payment Advisory Board, a panel which makes recommendations on Medicare cuts. Other legislation up for consideration from the House Ways and Means Committee include proposals requiring more transparency at the Centers for Medicare and Medicaid Services and promoting improvements to the Medicare Advantage program for seniors.

The House may also consider H. Con. Res. 55, a resolution directing the president to remove any U.S. troops deployed to Syria or Iraq after Aug. 7, 2014, other than those troops required to protect U.S. facilities and personnel, from those two nations. If it does come to the floor, the resolution is likely to prompt heated and partisan debate.

Appropriations markups for FY 2016 continue in the House and Senate Appropriations Committees, even though there is uncertainty about spending levels and the process moving forward. The House Appropriations Committee is scheduled to mark up its Interior and Environment spending bill on Tuesday. Two Senate Appropriations subcommittees will consider their Interior and Environment and Homeland Security bills. The House of Representatives has passed six of the 12 annual appropriations bills, while the Senate has yet to consider a single appropriations bill on the floor. The full Senate Appropriations Committee has approved five of the 12 annual bills.

The House Oversight and Government Reform Committee meets on Tuesday for a hearing on the recent data breach at the Office of Personnel and Management that exposed the personal information of millions of active and retired federal employees. The House Financial Services Subcommittee on Oversight and Investigations also meets on Tuesday for a hearing on global cybersecurity and cyberthreats.

The surface transportation authorization and Highway Trust Fund financing remain at the forefront of congressional priorities because the current short-term surface transportation authorization adopted just prior to Memorial Day expires in July. The House Ways and Means Committee is scheduled to meet on Wednesday to discuss long-term financing for the Highway Trust Fund, while the Senate Finance Committee will hold a hearing on Thursday on the challenges of highway funding, with former U.S. Department of Transportation Secretary Ray LaHood appearing before the committee as a witness.

Please feel free to contact the author or your other Duane Morris Government Strategies LLC contact to learn more about this week’s legislative session  and what it may mean to you.

A full schedule of congressional hearings for this week is included below.

About Duane Morris Government Strategies, LLC

DMGS is as an ancillary business of international law firm Duane Morris LLP, one of the 100 largest law firms with more than 700 attorneys in the U.S. as well as in the UK and Asia.

DMGS is comprised of 19 experienced professionals representing U.S. and foreign clients at the federal, state and local levels. The firm operates in eight offices including Newark, NJ; Trenton, NJ; Albany, NY; Harrisburg, PA; Philadelphia, PA; Pittsburgh, PA; Columbus, OH; and Washington, DC.

DMGS draws on decades of experience in building public support and positioning clients’ issues to achieve maximum success through the often-complex governmental decision-making process. DMGS offers a full range of government relations and public affairs services, including lobbying, grant identification/writing/administration, development finance consulting, procurement, grassroots campaigning, public relations, and crisis planning/crisis management needs.

DMGS’ diverse client list includes non-profits, educational institutions, social service organizations, health care organizations, technology companies, life sciences companies, manufacturers, municipalities, construction companies/engineering companies/developers, economic development agencies, and defense contractors.

For more information, please visit http://www.dmgs.com


Monday, June 15, 2015

Senate Committees

Iran Sanctions

Senate Foreign Relations

Full Committee Closed Briefing

5 p.m., S-116 Capitol Bldg.

TSA and Postal Service Nominations

Senate Homeland Security and Governmental Affairs

Full Committee Markup

5:30 p.m., S-216 Capitol Bldg.

Tuesday, June 16, 2015

House Committees

Fiscal 2016 Appropriations: Interior-Environment

House Appropriations

Full Committee Markup

10:15 a.m., 2359 Rayburn Bldg.

Child Nutrition Assistance Rules and Regulations

House Education and the Workforce

Full Committee Hearing

10 a.m., 2175 Rayburn Bldg.

EPA’s Proposed Ozone Rule and Manufacturing Impact

House Energy and Commerce – Subcommittee on Commerce, Manufacturing and Trade; House Energy and Commerce – Subcommittee on Energy and Power

Committee Joint Hearing

10:15 a.m., 2322 Rayburn Bldg.

Mental Health Legislation

House Energy and Commerce – Subcommittee on Health

Subcommittee Hearing

10 a.m., 2123 Rayburn Bldg.

Global Cybersecurity Issues

House Financial Services – Subcommittee on Oversight and Investigations

Subcommittee Hearing

10 a.m., 2128 Rayburn Bldg.

U.S. Interests at the United Nations

House Foreign Affairs

Full Committee Hearing

10 a.m., 2172 Rayburn Bldg.

TSA Aviation Workforce Vetting

House Homeland Security – Subcommittee on Transportation Security

Subcommittee Hearing

10 a.m., 311 Cannon Bldg.

Federal Lands Bills

House Natural Resources – Subcommittee on Federal Lands

Subcommittee Hearing

10 a.m., 1324 Longworth Bldg.

Arctic Resources

House Natural Resources – Subcommittee on Energy and Mineral Resources

Subcommittee Oversight Hearing

10:30 a.m., 1334 Longworth Bldg.

OPM Data Breach

House Oversight and Government Reform

Full Committee Hearing

10 a.m., 2154 Rayburn Bldg.

Tribal Labor Sovereignty Act

House Education and the Workforce – Subcommittee on Health, Employment, Labor and Pensions

Subcommittee Hearing

2 p.m., 2175 Rayburn Bldg.

Public Safety Broadband Network Update

House Energy and Commerce – Subcommittee on Communications and Technology

Subcommittee Hearing

2 p.m., 2322 Rayburn Bldg.

Business Development and Investment

House Financial Services – Subcommittee on Capital Markets and Government Sponsored Enterprises

Subcommittee Hearing

2 p.m., 2128 Rayburn Bldg.

Fiscal 2016 Europe and Eurasia Budget Request

House Foreign Affairs – Subcommittee on Europe, Eurasia and Emerging Threats

Subcommittee Hearing

2 p.m., 2172 Rayburn Bldg.

Merger and Acquisition Regulatory Legislation

House Judiciary – Subcommittee on Regulatory Reform, Commercial and Antitrust Law

Subcommittee Hearing

2 p.m., 2141 Rayburn Bldg.

International Shipping Competition

House Oversight and Government Reform – Subcommittee on Government Operations

Subcommittee Hearing

2 p.m., 2154 Rayburn Bldg.

Genetically Engineered Human DNA

House Science, Space and Technology – Subcommittee on Research and Technology

Subcommittee Hearing

2 p.m., 2318 Rayburn Bldg.

Federal Government Real Estate Investment

House Transportation and Infrastructure – Subcommittee on Economic Development, Public Buildings and Emergency Management

Subcommittee Hearing

1 p.m., 2167 Rayburn Bldg.

Drug Interdiction in the Western Hemisphere

House Transportation and Infrastructure – Subcommittee on Coast Guard and Maritime Transportation

Subcommittee Hearing

2 p.m., 2253 Rayburn Bldg.

SSA Disability Benefits Management

House Ways and Means – Subcommittee on Social Security

Subcommittee Hearing

2 p.m., B-318 Rayburn Bldg.

Senate Committees

Fiscal 2016 Appropriations: Homeland Security

Senate Appropriations – Subcommittee on Homeland Security

Subcommittee Markup

10:30 a.m., 138 Dirksen Bldg.

Energy Department Nominations

Senate Energy and Natural Resources

Full Committee Confirmation Hearing

10 a.m., 366 Dirksen Bldg.

Electronic Health Record User Experience

Senate Health, Education, Labor and Pensions

Full Committee Hearing

10 a.m., 430 Dirksen Bldg.

Federal Real Property Overhaul

Senate Homeland Security and Governmental Affairs

Full Committee Hearing

10 a.m., 342 Dirksen Bldg.

Fiscal 2016 Appropriations: Interior-Environment

Senate Appropriations – Subcommittee on Interior, Environment and Related Agencies

Subcommittee Markup

2:30 p.m., 124 Dirksen Bldg.

Asia-Pacific Region Trade Issues

Senate Foreign Relations – Subcommittee on East Asia, the Pacific, and International Cybersecurity Policy

Subcommittee Hearing

2:30 p.m., 419 Dirksen Bldg.

Native American Economic Issues

Senate Indian Affairs

Full Committee Panel Discussion

2:45 p.m., 216 Hart Bldg.

Wednesday, June 17, 2015

House Committees

Smithsonian Institution Assessment

House Administration

Full Committee Hearing

10:30 a.m., 1310 Longworth Bldg.

Fiscal 2016 Appropriations: Labor-HHS-Education

House Appropriations – Subcommittee on Labor, Health and Human Services, Education, and Related Agencies

Subcommittee Markup

9 a.m., 2358-C Rayburn Bldg.

Fiscal 2016 Appropriations: Financial Services

House Appropriations

Full Committee Markup

10 a.m., 2359 Rayburn Bldg.

Middle East Policy

House Armed Services

Full Committee Hearing

10 a.m., 2118 Rayburn Bldg.

Balanced Budget Issues

House Budget

Full Committee Hearing

10 a.m., 210 Cannon Bldg.

Financial Advice Access

House Education and the Workforce – Subcommittee on Health, Employment, Labor and Pensions

Subcommittee Hearing

10 a.m., 2175 Rayburn Bldg.

Financial Stability Oversight Council Report

House Financial Services

Full Committee Hearing

10 a.m., 2128 Rayburn Bldg.

Syria and Chemical Weapons

House Foreign Affairs

Full Committee Hearing

10 a.m., 2172 Rayburn Bldg.

Tribal Land Legislation

House Natural Resources – Subcommittee on Indian, Insular and Alaska Native Affairs

Subcommittee Hearing

11 a.m., 1324 Longworth Bldg.

Drones and Commerce

House Oversight and Government Reform

Full Committee Hearing

9 a.m., 2154 Rayburn Bldg.

Energy Innovation Hubs

House Science, Space and Technology – Subcommittee on Energy

Subcommittee Oversight Hearing

10:30 a.m., 2318 Rayburn Bldg.

Small Business and Crude Oil Issues

House Small Business

Full Committee Hearing

11 a.m., 2360 Rayburn Bldg.

Highway Trust Fund Financing

House Ways and Means

Full Committee Hearing

10 a.m., 1100 Longworth Bldg.

U.S. Navy Surface Combatant Capacity

House Armed Services – Subcommittee on Seapower and Projection Forces

Subcommittee Hearing

2 p.m., 2212 Rayburn Bldg.

International Monetary Fund Assessment

House Financial Services – Subcommittee on Monetary Policy and Trade

Subcommittee Hearing

2 p.m., 2128 Rayburn Bldg.

China’s Economic and Military Growth

House Foreign Affairs – Subcommittee on Asia and the Pacific

Subcommittee Hearing

2 p.m., 2200 Rayburn Bldg.

Iran, North Korea and Syria Nonproliferation Act

House Foreign Affairs – Subcommittee on the Middle East and North Africa

Subcommittee Hearing

2 p.m., 2172 Rayburn Bldg.

Immigration Policy Executive Actions

House Oversight and Government Reform – Subcommittee on National Security; House Oversight and Government Reform – Subcommittee on Health Care, Benefits and Administrative Rules

Subcommittees Joint Hearing

2 p.m., 2154 Rayburn Bldg.

Senate Committees

Federal Government Fiscal Challenges

Senate Budget

Full Committee Hearing

10 a.m., 608 Dirksen Bldg.

Consumer Product Safety Commission

Senate Commerce, Science and Transportation – Subcommittee on Consumer Protection, Product Safety, Insurance and Data Security

Subcommittee Oversight Hearing

10 a.m., 253 Russell Bldg.

Coal Ash Disposal Rule

Senate Environment and Public Works

Full Committee Oversight Hearing

9:30 a.m., 406 Dirksen Bldg.

Higher Education Reauthorization

Senate Health, Education, Labor and Pensions

Full Committee Hearing

10 a.m., 430 Dirksen Bldg.

Economic and National Security Policy

Senate Homeland Security and Governmental Affairs

Full Committee Hearing

10 a.m., 342 Dirksen Bldg.

USAID Administrator Nomination

Senate Foreign Relations

Full Committee Confirmation Hearing

2 p.m., 419 Dirksen Bldg.

GSA Inspector General

Senate Homeland Security and Governmental Affairs

Full Committee Confirmation Hearing

2 p.m., 342 Dirksen Bldg.

Capital Access Issues

Senate Indian Affairs

Full Committee Oversight Hearing

2:15 p.m., 628 Dirksen Bldg.

Joint Committees

Federal Credit Programs

Joint Economic

Full Committee Hearing

10 a.m., 216 Hart Bldg.

Thursday, June 18, 2015

House Committees

Optimized Fleet Response Plan

House Armed Services – Subcommittee on Readiness

Subcommittee Hearing

8 a.m., 2118 Rayburn Bldg.

Biotechnology Food Labeling Standards

House Energy and Commerce – Subcommittee on Health

Subcommittee Hearing

10 a.m., 2123 Rayburn Bldg.

Cuba Property Rights Outlook

House Foreign Affairs – Subcommittee on the Western Hemisphere

Subcommittee Hearing

10 a.m., 2172 Rayburn Bldg.

Rapid DNA Act

House Judiciary – Subcommittee on Crime, Terrorism, Homeland Security and Investigations

Subcommittee Hearing

9 a.m., 2141 Rayburn Bldg.

Senate Committees

Renewable Fuel Standard Program Management

Senate Homeland Security and Governmental Affairs – Subcommittee on Regulatory Affairs and Federal Management

Subcommittee Hearing

9:30 a.m., 342 Dirksen Bldg.

Future of Highway Funding

Senate Finance

Full Committee Hearing

10 a.m., 215 Dirksen Bldg.

Water Related Measures

Senate Energy and Natural Resources – Subcommittee on Water and Power

Subcommittee Hearing

2 p.m., 366 Dirksen Bldg.

NJ Out-of-Network Consumer Protection Act

The “Out-of-Network Consumer Protection, Transparency, Cost Containment, and Accountability Act.” [(Senator Joseph Vitale (D-19), Assemblyman Gary Schaer (D-36), Assemblyman Troy Singleton (D-7), and Assemblyman Graig Coughlin (D-19)] would implement sweeping legislation to reform various aspects of the New Jersey health care delivery system by: increasing transparency in pricing for health care services; enhancing consumer protections; creating an arbitration system to resolve certain health billing disputes; containing rising costs associated with out-of-network healthcare services; and, measuring success accordingly.

The  legislation would enhance employee rights and protections as patients and save an estimated $1.0 billion according to the sponsors. Others, including the New Jersey Association of Counties, (NJAC) are concerned that the measure may initially increase the costs of health benefits plans as the bill would impose an annual surcharge on all plans to fund operation and administrative expenses of a Healthcare Price Index (HPI). In summary, the HPI would: identify and electronically publish the list of median in-network paid commercial claims for the payment range as established under the bill; and, make healthcare data available to the State to improve healthcare quality, reduce healthcare costs, and increase pricing transparency.  Although in general it appears that the bill does directly apply to counties enrolled in the State Health Benefits Plan (Atlantic, Camden, Gloucester, Hudson, Mercer, Ocean, Salem, Sussex, and Warren), the annual surcharge imposed by the legislation would in fact impact all health benefit plans and counties.

Hence several recommendations have been put forth:  1) use an existing federal database on medical care to eliminate the need for a New Jersey specific HPI and corresponding surcharge; or, 2) establish  a New Jersey specific HPI as called for under the bill, but eliminate the surcharge, allocate a one-time State appropriation to establish the Health Price Index Fund, and dedicate monies collected from violations of the Act to the Fund for operation and administrative expenses.  NJAC is further seeking a clarification on whether the surcharge would impact health benefit plan expenses under the looming “Cadillac Tax” for high-cost employer-sponsored health benefits coverage set to begin 2018 at $10,200 for individual coverage and $27,500.000 for all other coverage tiers.

Bipartisanship Breaks Out

For a Congress best known for years of rancor, the extent of cooperation surrounding the he 21st Century Cures Act — coming on the heels of the bipartisan “doc fix” — suggests that Capitol Hill may really be focusing on legislating. Last Thursday’s  51-0 vote to advance the Cures Act to the full U.S. House of Representatives was an important milestone for a fast-evolving bill.

“This really kind of blows your mind considering all the angst and animosity and other kinds of … engagements that we have,” said Rep. Bobby Rush, D-Ill., who labeled Thursday’s hearing a “lovefest.” (Creddit AP).

Moreover, a 49-page amendment approved as part of Thursday’s vote at the Energy & Commerce Committee addressed a key concern by earmarking $550 million over five years to help the U.S. Food and Drug Administration fulfill new duties created by the bill. Those include development of new “biomarkers” to gauge drug effectiveness, enhanced incorporation of patient perspective into approval decisions, and grants to study so-called continuous drug manufacturing that could reduce production costs.

In addition, the amendment would exempt from budget sequestration the user fees paid by drug and device makers to support FDA reviews and inspections. Sequestration only kicks in if spending caps are exceeded, but the Cures bill now provides peace of mind for companies that complained about private money being locked away in 2013 because of political spending fights.

“FDA user fees were never intended, I think, to be part of the sequester,” Rep. Fred Upton, R-Mich., said on Thursday. (Credit AP).

Other substantive provisions were notable for their omission, including possible changes to dial back use of the 340B drug discount program by hospitals and clinics. Any such change could have alienated Democrats and jeopardized bipartisan support, and the provision’s absence won praise.

One provision would delay so-called reinsurance subsidies that go to health insurance plans in Medicare Part D in order to partly offset the costs of unusually expensive policyholders. The proposal stems from a 2013 inspector general’s report that found delays of certain advance payments would allow Medicare to generate more interest income — roughly $110 million in 2009 alone.

The current financial impact of that step is not yet public, but trade group America’s Health Insurance Plans reacted angrily on Thursday, saying that it “strongly opposes” the idea. Elsewhere, a new section starting in 2020 would cap Medicaid reimbursement for durable medical equipment at the amount paid under Medicare’s new competitive bidding program. The section is based on a provision in next year’s budget blueprint for the U.S. Department of Health and Human Services, which predicted $4.3 billion in savings over 10 years.

Nevertheless, Rep. Joe Barton, R-Texas, suggested that the vote was historic against any backdrop, and perhaps unprecedented in his nearly three decades on the Energy & Commerce Committee.

“I don’t think we’ve ever had a major bill — major bill — that didn’t have somebody … that voted no,” Barton said. “This is a real achievement.” (Credit AP).

Bipartisan House Vote Passes Permanent Medicare ‘Doc Fix’

The U.S. House of Representatives on Thursday passed a bill intended to put in place a permanent “doc fix” to replace Medicare’s unpopular physician reimbursement system, commonly overridden by lawmakers each year.

H.R. 2, the Medicare Access and CHIP Reauthorization Act, passed in a 392-37 vote, with many Democratic lawmakers joining the bulk of House Republicans in supporting the bill after several lawmakers from each party spoke in favor of the legislation on the House floor Thursday.

Under the bill, Medicare’s current sustainable growth rate formula, or SGR, would be permanently repealed. Instead, Medicare doctor pay would rise by 0.5 percent each year between 2015 and 2019, beginning in July.

Payments will then be held at the 2019 rate through 2025, but physicians and other health professionals will be eligible for merit-based bonus payments based on factors such as meaningful usage of electronic health record systems and their use of care models that emphasize quality over volume.

From 2026 onward, medical professionals who use certain alternative payment systems will receive a 1 percent annual increase in their Medicare payment rates, with others seeing 0.5 percent annual increases.

The SGR is a measure meant to tie increases in Medicare reimbursements to inflation, designed to avoid runaway cost increases. But the formula has been routinely overridden for almost two decades, through enactment of an annual “doc fix” — usually at the last minute — with lawmakers generally arguing that keeping to the SGR rates would cause many doctors to refuse Medicare patients, threatening access to care for seniors.

Over time, the gap between the specified rate under the SGR and the actual Medicare payment rate has grown amid this long pattern of temporary fixes. If a doc fix is not signed into law this year, doctors would see their Medicare reimbursement rate drop by 21 percent.

In addition to the doc fix section of the bill, the legislation also includes a collection of measures to both relax and strengthen various aspects of anti-fraud oversight under Medicare and would extend both the Children’s Health Insurance Program, or CHIP, and certain funding for community health centers for an additional two years.

To help offset the expected cost of the bill, pegged at more than $210 billion, House Democratic lawmakers agreed to a number of other Medicare changes, including tweaks to make supplemental Medigap plans less generous starting in 2020, and requiring certain high-income seniors to pay higher premiums for doctor and outpatient care and prescription drug coverage.

Their Democratic counterparts in the Senate have offered the bill qualified support, indicating they may push for a longer extension on CHIP funding and look to tweak some aspects of the legislation, such as the inclusion of the so-called Hyde Amendment  — used to bar federal funds from being used to fund abortion — for community health center funding, the same clause that has seen an otherwise uncontroversial anti-sex trafficking bill stall.

The White House has indicated it will support the bill in its current form, backing up President Barack Obama’s measured support with a policy statement Wednesday saying it believed the reforms in the bill were “sensible.”

The Evolution Of Medicare ACOs

The Centers for Medicare & Medicaid Services on Tuesday unveiled a new model of accountable care organization that offers larger financial risks and rewards, a test of whether stronger incentives can help health care providers deliver better quality and value.

The Patient Protection and Affordable Care Act (PPACA) created pathways for providers to become more accountable for their patients’ health care. One of these pathways, the Medicare Shared Savings Program, was intended to encourage the development of accountable care organizations (ACOs). In general terms, an ACO is a group of providers that work together to coordinate patient care and are rewarded if they lower their growth in health care costs while meeting quality standards.

The “Next Generation” model now joins two other types of ACOs — so-called Pioneers and those in the Medicare Shared Savings Program — and represents the boldest set of carrots and sticks that CMS has offered to move away from fee-for-service reimbursement. It’s also a contribution to new targets for tying pay to performance and nudging providers into alternative delivery models. But the approach is also a gamble, given that financial incentives in ACOs have so far had mixed results. In the Pioneer program, where participants take on more risk than those in the MSSP, only 19 of the 32 original ACOs remain. In the MSSP, participants are likely to get three extra years to share in savings without risking losses.

For the Next Generation approach, the first round of applications are due by June 1 and a second round will be due by June 1, 2016. CMS said it expects 15-20 ACOs to eventually participate and that more may be allowed “if resources are available and a compelling reason exists to do so.”

Participants will have a choice of two arrangements when it comes to the amount of financial risk they accept. There will be four different payment mechanisms, including traditional fee-for-service, supplemented fee-for-service, population-based pay and lump-sum capitation.

Beneficiaries served by doctors, hospitals and clinics in a participating ACO will retain the ability to visit other health care providers. But in order to encourage use of the ACOs, CMS said that it will make direct payments to beneficiaries who receive a minimum amount of care through an ACO — probably about $50 per year for those who get at least 50 percent of services through the Next Generation model.

Next Generation ACOs will also get a helping hand from relaxed restrictions on how care is delivered. For example, telemedicine services that provide diagnoses and prescriptions using videoconferencing will be exempted from requirements that patients be in rural areas and at an acceptable “originating site” when they receive their care.

Tuesday’s announcement included several documents with detailed information on how benchmark spending targets will be set, how risk and reimbursement will be structured and how savings will be calculated. Additional details will be supplied to applicants before signing of agreements, CMS said.

As with other ACOs, there may also be waivers from fraud and abuse laws involving kickbacks and referrals. But CMS said any such exemptions would be issued separately from Tuesday’s documents and that the waivers in Next Generation “could differ in scope or design from waivers granted for other programs or models.”