This Week in Washington: Debt Limit fight continues; Disagreements arise during Senate HELP Committee mark-up of PBM and Generic Drug Competition Bills



Debt Limit Fight Continues Amidst Approaching Default Deadline

Despite warnings by Secretary of the Treasury Janet Yellen that the U.S. could default on its federal debt as early as June 1, no debt limit bill has been agreed upon by Congress. On May 1, Secretary Yellen sent a letter to House Speaker Kevin McCarthy (R-CA), urging Congress to suspend or increase the debt limit as soon as possible. In response, Speaker McCarthy issued his own response, stating that House Republicans had done their job by passing the Limit, Save, Grow Act of 2023, H.R. 2811, by a vote of 217-215. McCarthy criticized the Senate and President Biden for not acting promptly in the wake up the bill’s passage. The bill is not expected to pass in the Democrat-controlled Senate. The leaders of the House and Senate are expected to meet with the President on May 9. In addition, House Democrats are exploring the possibility of a discharge petition, which would be a long shot.

Expanding Care in the Home Act Introduced

On April 26, Reps. Dingell (D-MI) and Smith (R-NE) introduced H.R. 2853, the Expanding Care in the Home Act. The bill specifically would:

  • Authorize certain Medicare beneficiaries who are not eligible for Medicaid to receive 12 hours of at-home personal care services per week from a personal care worker;
  • Increase access and broaden reimbursement for in-home dialysis treatment, advanced diagnostic imaging, lab testing and infusion services; and
  • Allow doctors to receive monthly payments for Primary Care Qualified Evaluation and Management Services (PQEM) as an alternative to fee-for-service reimbursements.

For more information, click here.

MADE in America Act Reintroduced

On April 26, Rep. Miller (R-WV), joined by 15 other members, reintroduced the Manufacturing API, Drugs, and Excipients (MADE) in America Act. The bill seeks to decrease the U.S. pharmaceutical supply chain’s dependency on China and would encourage manufacturing of drugs and pharmaceutical supplies such as active pharmaceutical ingredients (APIs) and personal protection equipment (PPE).

For more information, click here.

Association Health Plans Act Introduced

On April 25, Reps. Walberg (R-MI), Foxx (R-NC), Allen (R-GA), Burgess (R-TX), Crenshaw (R-TX) and Good (R-VA) introduced the Association Health Plans Act. The bill would expand healthcare plan options and costs for small businesses by allowing them to offer association health plans (AHPs). This legislation or variations of it have been introduced in past Congresses.

For more information, click here.


Senate HELP Committee PBM and Generic Drug Competition Bills Markup Falls Apart

On May 2, the Senate Health, Education, Labor and Pensions (HELP) Committee met to mark up a total of four bipartisan bills.

Ensuring Timely Access to Generics Act: Introduced by Sens. Bennet (D-CO), Shaheen (D-NH) and Collins (R-ME), this bill would help increase generic drug competition by strengthening oversight of the Food and Drug Administration’s (FDA) citizen petition process. The bill would grant the FDA permission to reject citizen petitions if the agency determines that the petition has been submitted to intentionally delay the approval of an application.

Expanding Access to Low-Cost Generics Act: Introduced by Sens. Smith (D-MN) and Braun (R-IN), this bill would address an anti-competitive drug practice known as “parking.” “Parking” refers to a practice in which a brand-name drug manufacturer agrees to not sue a generic drug manufacturer in exchange for the delayed release of their generic drug to the market. During this time, no other drug manufacturer may bring their own generic version of the drug to the market until 180 days have passed. This bill would allow a generic drug manufacturer to receive the 180-day market exclusivity if the first generic drug manufacturer does not make their drug available within 75 days.

Retaining Access and Restoring Exclusivity (RARE) Act: Introduced by Sens. Baldwin (D-WI) and Cassidy (R-LA), this bill would specify that the seven-year orphan drug market exclusivity period outlined in the Food, Drug and Cosmetic (FD&C) Act bans only the approval of other drugs with the same approved use or indication, not drugs that seek to treat the same disease or condition.

Pharmacy Benefit Manager Reform Act: Introduced by Sens. Sanders (I-VT), Cassidy (R-LA), Murray (D-WA) and Marshall (R-KS), this bill would seek to ban a practice utilized by pharmacy benefit managers (PBMs) known as “spread pricing,” a technique whereby PBMs charge health insurance plans more for a drug than the amount they reimburse to pharmacies for dispensing it. The bill would require that all rebates negotiated with drug manufacturers and all fees collected by PBMs are passed through to applicable health insurance plans.

Although Committee Chairman Sanders (I-VT) and Ranking Member Cassidy (R-LA) had announced that they had come to an agreement to mark up the bills and to advance certain measures, the markup did not go as planned. Sen. Cassidy accused Sen. Sanders of reneging on the agreement when Sen. Sanders announced that he would allow a number of bipartisan amendments to the RARE Act to move forward. Sen. Cassidy criticized Sen. Sanders for failing to share FDA technical assistance and Congressional Budget Office (CBO) cost estimates for the amendments in question. The committee decided to go into recess, and Sens. Sanders and Cassidy agreed to reschedule the markup for May 11.

For more information, click here.

Cutting Medicare Prescription Drug Prices in Half Act Introduced

On May 4, Senate Health, Education, Labor and Pensions Chairman Bernie Sanders (I-VT) and Sen. Klobuchar (D-MN) introduced the Cutting Medicare Prescription Drug Prices in Half Act. The bill seeks to cut the Medicare price of prescription drugs by half by requiring Medicare to pay no more for prescription drugs than the U.S. Department of Veterans Affairs (VA). The bill would also require drug manufacturers to make their medicines available to Medicare at the same prices paid by the VA or the Federal Supply Schedule, whichever is lowest.

For more information, click here.

PASTEUR Act Reintroduced

On April 27, Sens. Young (R-IN) and Bennet (D-CO) reintroduced the Pioneering Antimicrobial Subscriptions to End Upsurging Resistance (PASTEUR) Act. The bill would encourage the appropriate use of antibiotics, increase domestic availability of antibiotics and support the development of antibiotics that target drug-resistant infections. The bill would specifically:

  • Establish a subscription payment model for antibiotic drug developers, whereby developers would be offered an upfront payment in exchange for access to their antibiotics. This payment amount would range anywhere from $750 million to $3 billion. This subscription model is intended to encourage antimicrobial drug development, particularly drugs that target so-called “superbugs” such as Candida auris and Clostridioides difficile. Developers are currently paid through contracts based on the total volume of their drugs. Subscription-based contracts would be valid for a period of five years or up to the point of an antimicrobial drug’s patent life;
  • Enhance existing frameworks of the Centers for Disease Control and Prevention (CDC) National Healthcare Safety Network, the Emerging Infections Program and other programs focused on analyzing and reporting antibiotic usage and resistance data;
  • Establish a Committee on Critical Need Antimicrobials, which would be tasked with developing and implementing guidance on how to treat infections of concern. The committee would be made up of federal agency representatives, doctors, patients and outside experts; and
  • Offer small subscription contracts to smaller antimicrobial drug developers.

A companion bill was introduced in the House by Reps. Peters (D-CA), Ferguson (R-GA), Levin (D-CA) and LaTurner (R-KS).

For more information, click here.

Workforce Legislation Introduced

In the Senate several bills were introduced related to workforce and direct care. The Resident Physician Shortage Reduction Act was introduced on April 27 by Sens. Menendez (D-NJ), Boozman (R-AR), Schumer (D-NY) and Collins (R-MN). The bill would eliminate the cap on Medicare-funded graduate medical education (GME) positions and would increase the number of GME positions by 14,000 over the next seven years. Hospitals in rural areas and those serving Health Professional Areas (HPSAs) would be prioritized. Hospitals in states with new medical schools and those currently training over their caps would also be granted priority.

For more information, click here.

In addition, the Supporting Our Direct Care Workforce and Family Caregivers Act was introduced, led by Senator Casey (D-PA). The legislation would:

  • Direct the Department of Health and Human Services (HHS) to award grants to states and eligible entities to be used for the recruitment, training and promotion of direct care workers and family caregivers. The grants would also go towards caregiver education and training support. Grants would be administered through the Administration on Community Living (ACL); and
  • Direct the ACL to establish a center that would be tasked with offering technical assistance to grant awardees and direct care workforce development entities. The center would be responsible for establishing direct care career development, advancement strategy, apprenticeship, specialization, certification and on-the-job training programs. Additionally, the center would be tasked with identifying workforce shortages and evaluating the effectiveness of grants.

For more information, click here.

Senate Finance Committee Discusses Ghost Networks

On May 3, Sen. Wyden (D-OR) held a hearing to discuss the findings of a secret shopper study conducted by the committee majority staff. Staff reviewed directories from 12 different plans in a total of six states, calling 10 systematically selected providers from each plan, for a total of 120 calls. Of the total 120 provider listings contacted by phone, 33 percent were inaccurate, nonworking numbers or unreturned calls. Staff could only make appointments 18 percent of the time.

The Chair’s statement on the findings is available here.

The Chair’s hearing on ghost networks is available here.

Strengthening Medicare and Reducing Taxpayer (SMART) Prices Act Introduced

On April 24, 23 Sens. Klobuchar (D-MN) and Welch (D-VT) led 23 senators in introducing the Strengthening Medicare and Reducing Taxpayer (SMART) Prices Act. The bill would grant the Department of Health and Human Services (HHS) enhanced authority to negotiate Medicare Part D drug prices and would allow new drugs and biologics approved by the Food and Drug Administration (FDA) to be eligible for price negotiation for a period of five years. The bill would also increase the number of drugs that HHS can negotiate after 2026 and allow Medicare Part B drugs to be negotiated two years earlier than allowed under current law.

For more information, click here.

GAO Appoints Six New MACPAC Board Members and Vice Chair

On May 1, the Government Accountability Office (GAO) announced the appointment of six new members to the Medicaid and Children’s Health Insurance Program (CHIP) Payment and Access Commission (MACPAC). They are as follows:

  • Timothy Hill, MPA, Vice President for Client Engagement at the American Institute for Research (AIR);
  • Carolyn Ingram, MBA, Executive Vice President of Molina Healthcare, Inc.;
  • Patti Killingsworth, Senior Vice President of Long Term Services and Supports (LTSS) Strategy at CareBridge;
  • John B. McCarthy, MPA, Founding Partner at Speire Healthcare Strategies;
  • Adrienne McFadden, MD, JD, Chief Medical Officer of Medicaid at Elevance Health; and
  • Jami Snyder, MA, President and Chief Executive Officer at JSN Strategies LLC.

The GAO also announced that Robert Duncan will serve as MACPAC’s new Vice Chair. Duncan serves as Executive Vice President and Chief Operating Officer of Connecticut Children’s Speciality Care Center, and previously served as Executive Vice President of Children’s Wisconsin and the President of Children’s Service Society.

Read more on healthcare policy in McGuireWoods Consulting’s Washington Healthcare Update.