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Senate HELP Committee Leaders Release Bipartisan Draft Legislation to Reduce Health Care Costs

May 24, 2019—Senate Health, Education, Labor, and Pensions (HELP) Chair Lamar Alexander (R-Tenn.) and Ranking Member Patty Murray (D-Wash.) May 23 released the Lower Health Care Costs Act of 2019, a bipartisan discussion draft aimed at reducing health care costs. The draft focuses on five key areas: ending surprise medical bills, reducing prescription drug costs, increasing transparency, improving public health, and enhancing health information technology (HIT).

In a joint press release, Senators Alexander and Murray both emphasized the bipartisan nature of this proposal. Alexander stated, “Republicans and Democrats in the United States Senate have announced this proposal of nearly three dozen specific bipartisan provisions that will reduce the cost of what Americans pay for health care. These are common sense steps we can take, and every single one of them has the objective of reducing the health care costs that you pay for out of your own pocket.” Murray added, “The steps we are taking on important issues like surprise medical billing, drug prices, maternal mortality, and vaccine hesitancy show we can make progress when both sides are at the table ready to put patients and families first.”

This discussion draft builds upon recent efforts in both chambers of Congress to address surprise medical bills [see Washington Highlights, May 17] by proposing three different options to ensure that patients would only be held harmless and required to pay the in-network amount — whether they receive emergency services or inadvertently receive out-of-network care. The first option requires all practitioners at an in-network hospital to provide in-network care to patients. Providers would be able to join the insurance networks that cover that hospital or can choose to send the bill through the hospital rather than sending separate bills to the patient or insurer.

The second option would benchmark services so that insurance companies would pay providers the median contracted rate for services provided in that geographic area. The final option provides for arbitration. For surprise bills over $750, the insurer or provider would both submit their best offer to an independent arbiter to make a final decision on the price to be paid.

The discussion draft also includes nine sections aimed at reducing the cost of prescription drugs. The text suggests several approaches including: increasing availability of patent and exclusivity information for drugs and biologics through submission of information to the Health and Human Services Secretary and publication in the Orange Book and Purple Book; adding additional clarification for products that will transition from the Food and Drug Administration’s (FDA) “drugs” to “biologics” pathway classification in March 2020; introducing language to restrict exclusivity protections for generics and new chemical entities; and requiring the FDA to provide education on biologics to the public via a website and to health care providers through Continuing Medical Education opportunities.

Several sections reflect bills already introduced in the 116th Congress, including the Biologic Patent Transparency Act (S. 659), the Ensuring Timely Access to Generics Act of 2019 (H.R. 2455 / S. 1169), the Protecting Access to Biosimilars Act of 2019 (H.R. 2011 / S. 1140), and the House-passed Orange Book Transparency Act of 2019 (H.R. 1503) [see Washington Highlights, May 10].

Additionally, the proposal seeks to improve transparency in the health care market in a number of ways, including directing a nongovernmental, nonprofit entity to use de-identified patient health care data so patients, states, and employers can better understand health care costs and take steps to reduce those costs.

Other key provisions of the draft legislation seek to increase vaccination rates and prevent disease outbreaks, expand the use of technology-based health care models, reduce maternal mortality rates, and enhance HIT to give patients full access to their own health claims information and incentivize health care systems to keep personal health information private and secure.

The HELP Committee is requesting feedback on this draft proposal by Wednesday, June 5. According to Chairman Alexander, the Committee plans to mark up the legislation by the end of June.

Contact

Jason Kleinman
Senior Legislative Analyst, Govt. Relations
Telephone: 202-903-0806
Email: jkleinman@aamc.org

Christa Wagner, PhD
Senior Legislative Analyst
Telephone: 202-828-0595
Email: chwagner@aamc.org

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AAMC Endorses House Conrad 30 Reauthorization

May 24, 2019—Representatives Brad Schneider (D-Ill.), Don Bacon (R-Neb.), and Abby Finkenauer (D-Iowa) May 23 introduced the Conrad State 30 and Physician Access Act (H.R. 2141), which would reauthorize and expand the Conrad 30 J-1 visa waiver program. Corresponding legislation was introduced in the Senate earlier this year by Sens. Amy Klobuchar (D-Minn.), Susan Collins (R-Maine), and Jacky Rosen (D-Nev.) [see Washington Highlights, April 5].

The legislation would:

  • Allow the program to expand beyond 30 slots if certain nationwide thresholds are met;
  • Create three new Conrad 30 slots per state to be used by academic medical centers;
  • Allow “dual intent” for J-1 visa physicians seeking graduate medical education; and
  • Establish new employment protections and a streamlined pathway to a green card for participants.

A press release accompanying the bill noted endorsements from the American Hospital Association, the National Rural Health Association, and the AAMC. “As the United States faces an unprecedented shortage of up to 121,000 physicians by 2030, Conrad 30 has been a highly successful program for underserved communities to recruit both primary care and specialty physicians after they complete their medical residency training,” said the AAMC. “We applaud this bipartisan reauthorization for recognizing immigrating physicians as a critical element of our nation’s health care infrastructure, and we support the expansion of Conrad 30 to help overcome hurdles that have stymied growth of the physician workforce.”

Contact:

Matthew Shick, JD
Sr. Director, Gov't Relations & Regulatory Affairs
Telephone: 202-828-0525
Email: mshick@aamc.org

Brett Roude
Legislative Analyst
Telephone: 202-753-5726
Email: broude@aamc.org

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AAMC Joins Higher Education Comments on Proposed Department of Labor Overtime Rule

May 24, 2019—The AAMC May 21 joined a comment letter led by the College and University Professional Association for Human Resources (CUPA-HR) on the Department of Labor (DOL) notice of proposed rulemaking (NPRM) regarding overtime pay requirements under the Fair Labor Standards Act (FLSA).

The NPRM would repeal the 2016 DOL rule that attempted to increase the salary threshold for exempting certain employees from FLSA overtime requirements to levels greater than the National Institutes of Health (NIH) postdoctoral National Research Service Award (NRSA) stipend level [see Washington Highlights, May 20, 2016].

As noted in the letter, the new DOL rule proposes “increasing the current (2004) level of $455 per week ($23,660 annually) to $679 per week ($35,308 per year) by using the same formula it employed in 2004, which was set to the 20th percentile of earnings for full-time salaried employees.” This level is below the 2019 NIH postdoctoral NRSA stipend level of $50,004. The DOL also proposes “requiring, every four years, an update to the salary threshold using the 2004 formula through notice-and-comment rulemaking.”

The CUPA-HR comments “agree that an increase to the minimum salary threshold is due and that DOL must update the salary levels and regulations from time to time to ensure the exemptions are not abused.” The letter also made the following suggestions:

  • Any final rule should allow employers to prorate the salary threshold for part-time employees;
  • DOL should count the cost of employer-provided room and board toward the salary threshold;
  • DOL should update the regulations every five to seven years based on circumstance as any automatic update may exceed DOL’s authority under the FLSA and, therefore, will be susceptible to legal challenge; and
  • If DOL does decide to proceed with an automatic update, the agency should make clear that any change to the methodology used to determine the standard salary level as part of future updates would require multiple proposed rulemakings.

Medical residents remain exempt from the FLSA overtime requirements.

Contact:

Matthew Shick, JD
Sr. Director, Gov't Relations & Regulatory Affairs
Telephone: 202-828-0525
Email: mshick@aamc.org

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AAMC Joins Community Letters on CDC REACH and IHS Funding

May 24, 2019—The AAMC May 20 joined a community letter to House Appropriations Subcommittee on Labor, Health and Human Services, Education and Related Agencies Chair Rosa DeLauro (D-Conn.) and Ranking Member Tom Cole (R-Okla.), thanking them for providing the Centers for Disease Control and Prevention (CDC) Racial and Ethnic Approaches to Community Health (REACH) program with $71.95 million for fiscal year (FY) 2020. The funding level constitutes a $16 million (28%) increase over FY 2019 enacted levels.

CDC REACH is the community health program funded by the CDC that is specifically dedicated to urban, rural, and tribal communities working to lessen and eliminate racial and ethnic health disparities. The REACH program currently funds 31 recipients, including academic medical centers and community partners, to reduce health disparities among racial and ethnic minority populations with the highest burden of chronic disease.

The AAMC May 21 also joined the American Indian/Alaska Native Health Partners in submitting a written statement to the Senate Appropriations Subcommittee on Interior, Environment and Related Agencies advocating for increased funding for the Indian Health Services (IHS). The testimony encourages the subcommittee to:

  • Increase the Health Professions account, which provides scholarships, loan repayment, and training to providers serving American Indian communities by $32,300,000 to $89,363,000;
  • Increase funding for housing for health care providers by $30,000,000 to $89,363,000; and
  • Increase funding for medical equipment by $10,000,000 to $33,706,000.

Contact:

Matthew Shick, JD
Sr. Director, Gov't Relations & Regulatory Affairs
Telephone: 202-828-0525
Email: mshick@aamc.org

Brett Roude
Legislative Analyst
Telephone: 202-753-5726
Email: broude@aamc.org

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House Ways and Means Subcommittee Convenes Surprise Medical Bills Hearing

May 24, 2019—The House Ways and Means Health Subcommittee May 21 convened witnesses from the American Hospital Association (AHA), the American Medical Association (AMA), America’s Health Insurance Plans (AHIP), and the ERISA Industry Committee (ERIC) to discuss how to protect patients from surprise medical bills.

Subcommittee Chair Lloyd Doggett (D-Texas) opened the hearing by highlighting a local San Antonio television series titled, “Show Me Your Bill,” which chronicles patients’ surprise medical bills, allows patients to tell their stories, and helps them get resolution for these bills. Doggett emphasized that surprise medical bills are a nationwide problem, and that there are numerous bipartisan proposals currently in Congress to address the issue. Doggett stated, “I support whichever solution can secure 218 votes here in the House and gain Senate approval and the President’s signature.”

In his opening statement, Subcommittee Ranking Member Devin Nunes (R-Calif.) agreed with Chairman Doggett that surprise medical bills are a nationwide problem, and he also highlighted his home state’s new law which “has pretty robust protections against balance billing patients, going so far as to set a required reimbursement scheme.” Nunes also expressed dismay that the federal government may have to step in, stating that “the organizations represented [on the panel] … have the power, and I would argue the responsibility, to solve this issue for patients. I think there are a lot of different steps you should voluntarily take to protect your patients and policyholders.”

Several of the witnesses expressed concern with the concept of rate setting, including AHA Executive Vice President of Government Relations and Public Policy Tom Nickels and Bobby Mukkamala, MD, a physician from Florida and AMA board member. Nickels said that setting a reimbursement standard in law would create a “disincentive for insurers to maintain adequate provider networks.” He added that including “bundling” of hospital and clinical services into a single bill would add significant complexity to what should be a straightforward solution.

Nickels also expressed support for the ability to arbitrate between providers and insurers, should an agreement on payment rate fail to be reached. Jeannette Thornton, senior vice president for product, employer, and commercial policy at AHIP, disagreed, stating that arbitration could drive up premiums and that “there’s a likelihood that they’re [the arbitrator] going to want to take the providers’ price, as well as you’re really sort of rewarding a provider from coming in with an overall higher price in the first place.”

Most members of the subcommittee agreed that the federal government would likely have to step in with a solution to protect patients from surprise medical bills and emphasized that any solution should be bipartisan in nature.

This hearing occurred as both Congress and the White House have turned their attention to surprise medical bills over the past few weeks, with lawmakers in both chambers releasing proposed legislation and the President releasing overarching principles for Congress to follow as they generate legislative proposals [see Washington Highlights, May 17, May 10].

Contact:

Allyson Perleoni
Senior Legislative Analyst
Telephone: 202-862-6042
Email: aperleoni@aamc.org

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House Judiciary Committee Approves New DREAM Act

May 24, 2019—The House Judiciary Committee May 22 held a mark-up on the Development, Relief, and Education for Alien Minors (DREAM) Act of 2019 (H.R. 2820). The legislation passed the committee by a party line vote of 19-10.

During her opening statement, Immigration and Citizenship Subcommittee Chair Zoe Lofgren (D-Calif.) noted how Deferred Action on Childhood Arrival (DACA) recipients are “medical students and Rhodes Scholars who provide benefits to all Americans and have so much to offer our country,” and how the DREAM Act would “prevent DACA recipients from hiding in the shadows and provide them with the certainty they need to benefit our country.”

Originally introduced as the American Dream and Promise Act (H.R. 6), the legislation was split into the DREAM Act (H.R. 2820) to address DACA recipients and the American Promise Act (H.R. 2821), which addresses temporary protected status recipients [see Washington Highlights, March 22]. The new DREAM Act would provide DACA recipients with permanent resident status and a pathway to citizenship. While the bill also omits any specific mention of Title IV student financial aid programs, permanent resident status confers eligibility for all federal student aid.

Contact:

Matthew Shick, JD
Sr. Director, Gov't Relations & Regulatory Affairs
Telephone: 202-828-0525
Email: mshick@aamc.org

Brett Roude
Legislative Analyst
Telephone: 202-753-5726
Email: broude@aamc.org

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On the Hill

May 24, 2019—Fred Keller, a Republican state representative from Pennsylvania, won a May 21 special election to represent Pennsylvania’s 12th district in the House of Representatives following former Rep. Tom Marino’s Jan. 23 resignation.


On the Agenda

Both the House and the Senate are in recess, returning June 3.

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Washington Highlights, a weekly electronic newsletter, features brief updates on the latest legislative and regulatory activities affecting medical schools and teaching hospitals.


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For More Information

Jason Kleinman
Senior Legislative Analyst, Govt. Relations
Telephone: 202-903-0806
Email: jkleinman@aamc.org