Federal Health Care Legislative Agenda: Fall Updates

At a Glance

• While funding will dominate the federal health care legislative agenda, a second important category are bills to reauthorize programs that will expire.
• Other issues gaining attention include efforts to reform the Pharmacy Benefit Manager sector, lower insulin prices, and provide more price and data transparency to health care consumers.

As Congress returns and summer turns to fall, the federal health care legislative agenda remains crowded. While much near-term energy is focused on September 30 and averting a shutdown of the federal government before the October 1 start to Fiscal Year 2024, a number of priorities — including the reauthorization or extension of expiring programs or policies — are also on the agenda. Following is an overview of the federal health care legislative landscape and potential scenarios.

• FY 2024 Funding: There are two ways Congress can avoid shutting down the government: pass the 12 annual appropriations or spending bills that will fund the government from October 1, 2023, through September 30, 2024, or pass a continuing resolution (CR) to extend the prior year’s funding level. A third hybrid approach could be a CR with some targeted adjustments to reflect needs and priorities. The 12 spending bills can be passed independently, in groups (minibuses) or all together (omnibus).

While the agreement to raise the debt ceiling that was enacted in June set top-level spending parameters for FY 24 and FY 25 that should facilitate the annual appropriations process, opposition from a segment of House Republicans — notably the Freedom Caucus — to the debt ceiling spending levels and the very narrow Republican majority have complicated the situation. Given this pressure, the House developed spending bills below the agreed-upon levels complicating any negotiations with the Senate. This, along with the inclusion of several controversial policy proposals, or “riders,” in most bills along with calls for additional funding to respond to recent natural disasters, such as the Hawaii wildfires and Florida hurricanes, and to support Ukraine in its war with Russia make for a rocky path toward resolving FY 24.These factors leave some suggesting that a long-term continuing resolution may be the most desirable option even with the penalty, included in the debt agreement, of enacting one-percent reduction in spending if Congress fails to enact all 12 annual appropriations bills by January.

The nearest-term spending question will be if Congress can pass a temporary spending bill or continuing resolution to bridge from October 1 until sometime later in the year, most likely mid-November or early December, though House Speaker McCarthy has more recently raised early November targets. Such stopgaps have been routine over the past two decades but are nowhere near automatic today. The narrow House Republican majority and the stated opposition to a short-term deal by the Freedom Caucus could place House Speaker Kevin McCarthy’s position at risk should he proceed by relying on the votes of chamber Democrats. Expect that reaching an agreement to prevent a government shutdown will occupy much of leaderships’ attention. Additionally, how Congress resolves FY 24 appropriations may well shape how the body addresses other items on the docket.

While funding will dominate the agenda, a second important category includes bills to reauthorize programs that will expire. Options before Congress including expeditiously passing more comprehensive multi-year reauthorizations, passing short-term reauthorizations akin to a temporary spending bill or, in some cases, allowing an authorization to lapse while still allocating funding for the program. In addition to extenders, Congress is also focusing on a set of priority issues, including legislation to reform the Pharmacy Benefit Manager (PBM) sector; lower insulin prices and blunt looming reductions in Medicare payments to physicians; and provide more price and other data transparency to health care consumers. On Wednesday, a trio of House Committees put forward a package combining several of these topics with reauthorization bills. Following is an overview of some key extenders followed by other emerging health policy topics.

Extenders

• PAHPA Reauthorization: Reauthorizing the nation’s core biohazard response law — the Pandemic All-Hazards Preparedness Act — is another to-do item. While PAHPA enjoys strong bipartisan support, the reauthorization has been challenged in the House by a disagreement as to whether the legislation is an appropriate vehicle for legislation to address drug shortage concerns. This issue has led to a sharp divide among Energy & Commerce members, chilling what had been identified as a bipartisan bright spot. On the Senate side, the HELP Committee advanced its version of the reauthorization law on a largely bipartisan vote in July.
• Mental and Behavioral Health: Another expiring measure is a 2018 law, known as the SUPPORT Act, that contained multiple policies to respond to the opioid crisis. For example, this law included a Medicaid option to allow for limited inpatient substance use disorder treatment. The House Energy & Commerce Committee has advanced the Support for Patients and Communities Reauthorization Act out of committee, and it awaits floor action with more than 60 bipartisan cosponsors. The bill would reauthorize many of the original SUPPORT Act programs and contains additional provisions intended to combat arising issues with fentanyl and xylazine. HELP Ranking Member Sen. Bill Cassidy (R-LA) released a draft SUPPORT Act reauthorization bill before August recess, but the panel has not yet officially reviewed legislation on the topic.
• Other Reauthorizations or Expiring Measures: Congress also has other expiring health-related laws or policies on its agenda. These include laws to reauthorize programs for community health centers (CHCs) as well as the training of pediatricians and the law to reauthorize the Food and Drug Administrational animal drug user fee program (ADUFA). Reauthorization of the historically highly bipartisan Children’s Hospital Graduate Medical Education (CHGME) program has become another divisive issue this year as part of larger debates about gender-affirming medical care for children. This threatens reauthorization of the law though Congress could still appropriate funding for the program as it has done in the past when its reauthorization lapsed. Additionally, Congress needs to act to prevent a reduction in funding to hospitals, known as Disproportionate Share Hospitals, who treat high percentages of Medicaid beneficiaries or underinsured persons. Congress has acted multiple times to prevent DSH cuts from going into effect and delaying DSH cuts once again enjoys strong bipartisan support.

Other Priority Issues

• PBM Reform: By the August recess, more than a half-dozen committees on both sides of the Capitol had acted on PBM reform legislation. The bills enjoy several similarities including increased transparency requirements for the opaque sector and limits on certain practices, such as the use of spread pricing. But variations exist between the bills. Big questions include if Congress will ultimately ban practices or instead focus on greater transparency and oversight and, ultimately, how extensive or narrow any bill may be. Addressing PBMs has been highly bipartisan in most committees and the tri-committee House bills contains provisions to increase transparency and to prohibit the use of spread pricing within Medicaid Managed Care.
• Insulin: Another popular and bipartisan topic is legislation that would cap the cost of insulin to $35 a month for enrollees in group and individual plans, similar to the benefit the Inflation Reduction Act (IRA) included for Medicare Part D beneficiaries. But competing bipartisan Senate insulin bills and differing approaches and scopes — as well as the price tag of such a measure — have kept the legislation from advancing. And while Senate support for insulin legislation is bipartisan, that same level of support has not emerged in the House.
• Physician Payments: Physician advocates continue to voice that Congress must act on legislation to blunt planned reductions in payments to physicians, currently set to go into effect in the calendar year (CY) 24 physician fee schedule. Congress acted in late 2022 to partially (but not completely) address proposed cuts as well as extend bonus payments for providers in alternative payment arrangements. For many years before the enactment of the MACRA reform law in 2015, it was commonplace for Congress to enact legislation to avert physician payment cuts, with the bill often being a driver for additional Medicare measures. Without another more permanent solution, calls to extend value-based care incentives or prevent physician fee schedule reductions, which will compound over time, could become commonplace once again.
• Health Care Transparency: Congress is interested in policies to increase health care price transparency for consumers beyond PBMs. The Centers for Medicare & Medicaid Services (CMS) published hospital price transparency enforcement updates earlier this year, and a phase-in of health plan price transparency (transparency in coverage) requirements began in 2022. Congressional committees have held numerous hearings on the topic this Congress and are considering legislation to codify and amend CMS hospital pricing regulations; extend such requirements into other services including imaging, clinical lab tests and outpatient surgeries; and require transparency in insurance provider networks with the intention of avoiding “ghost networks” in which providers on the list aren’t actually available.