Healthcare & the New Congress: The 2017 Agenda
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1 Healthcare & the New Congress: The 2017 Agenda What You Need to Know About the Trump Administration, changing priorities on Capitol Hill, and what s happening in healthcare policy in Washington.
2 Summary The 2016 Election In Review Healthcare Under a New Administration GOP Repeal Efforts Repeal of the Affordable Care Act o What s In & What s Out What s Next In Washington HIDA Transition Updates
3 2016 Elections In Review Final 2016 Presidential Election Tally Donald J. Trump o 306 Electoral Votes o 46.3% - 62,693,993 Won: 30 of 50 States 2,623 Counties Hillary R. Clinton o 232 Electoral Votes o 48.2% - 65,260,513 ( million) Won: 20 of 50 States 489 Counties Trump won more electoral votes than any Republican since George H.W. Bush in Clinton spent $2.79 million per Electoral College (EC) vote, while Trump spent $2.03 million per EC vote. Latino Vote: Exit polls found that 29% of Latino voters supported Donald Trump. o According to Pew Research there were 27.3 million Latino voters this year, meaning that 7.9 million Latinos voted for Trump.
4 2016 Elections In Review The 2016 election gave the GOP simultaneous control of the White House, the Senate, and the House of Representatives. Has happened only 3 times before. o This is the first time since 1928, when Herbert Hoover was elected to the White House, that Republicans will have a Republican President starting his term with his party in control of both chambers of Congress coupled with the ability to fill a Supreme Court vacancy with a judge of his ideological choosing (pending nominations). Republicans now hold an all-time high of 68 out of 99 state legislative chambers. In the last 8 years, more than 900 Democratic state legislators were defeated. o Republicans control both chambers in 32 states, including 17 with veto-proof majorities. Those 32 states cover 61 percent of the U.S. population. o Democrats, meanwhile, control the legislature in just 13 states, amounting to 28 percent of the country s population; only four of those chambers have veto-proof majorities.
5 2016 Elections In Review Republicans now control the governor s office in 33 states, amounting to 60 percent of the population, while Democrats control just 16 states with 40 percent of the population. In the last 8 years, more than 15 Democrat Governors were defeated. GOP has control over 25 states outright and another two where they can override a Democratic governor s vetoes. These 27 states cover 56 percent of the population. This is where the GOP has the edge in setting themselves up for long-term control. With every new census, comes a new opportunity to draw lines for Congressional districts advantage Republicans in a large majority of states. Democrats have total control outright in 6 states outright and veto-proof majorities to override a Republican governor in just two more. These eight Democratic-controlled states add up to only 19 percent of the population, or roughly one-third as much as Republicans control.
6 Healthcare Under a New Administration President Trump s Healthcare Priorities Repeal of the Affordable Care Act (ACA) Block granting the Medicaid program Created the ability to purchase health insurance across state lines Creation and funding of state high-risk pools Expansion of tax-free Health Savings Accounts (HSAs) Opening up avenues for prescription drug importation Increase provider price transparency to empower consumers Defund Planned Parenthood
7 Healthcare Under a New Administration Health and Human Services (HHS) Secretary Former House Budget Committee Chairman Tom Price, M.D. (R-GA) Background: Elected first in 2004, he currently represents Georgia s 6 th district in the House of Representatives. Served on the House Committee on Ways and Means, as Chairman of the Republican Study Committee, and currently as Chair of the House Budget Committee. Worked in private practice for 20 years as an orthopedic surgeon. Served as Medical Director of the Orthopedic Clinic at Grady Memorial Hospital in Atlanta. Policy Positions: Supports the repeal of the Affordable Care Act (ACA). Has written his own bill to replace the ACA and was an instrumental part of the House Better Way Plan that will be the basis of much of the Repeal and Transition plan in Supports eliminating much of the federal government s role in healthcare, specifically through: o a free-market framework built on privatization, state flexibility, and changes to the tax code. o a plan to privatize Medicare so seniors would receive fixed dollar amounts to buy coverage. o limited federal spending on Medicaid by giving states block grants.
8 Healthcare Under a New Administration Administrator of the Centers for Medicare and Medicaid Services (CMS) Seema Verma, CEO, SVC Strategic Health Policy Solutions Background: Is President, CEO, and founder of SVC, Inc., a national health policy consulting company. Served as Vice President of Planning for the Health & Hospital Corporation of Marion County. Served as Director with the Association of State and Territorial Health Officials in Washington, D.C. Has a close relationship with Vice President-Elect Mike Pence due to her past work in Indiana s healthcare system. Policy Positions: Helped to implement health policies favored by Republicans, such as: Health Savings Accounts limits on non-emergency transport healthy lifestyle requirements for beneficiaries Is considered the architect of the Healthy Indiana Plan (HIP), the nation s first consumer-directed Medicaid program. Developed many of the recent Medicaid reform programs, including waivers for Iowa, Ohio, and Kentucky, and helping to design Tennessee s coverage expansion proposal.
9 Proposed Payment Regulations CMS Administrator Verma and HHS Secretary Price have stated their interest in reviewing Medicare s regulations. CMS included a substantial Request for Information (RFI) to gather feedback from stakeholders on how Medicare can be improved. Specifically, CMS wants input on: regulatory policy practice and procedural changes to better achieve transparency flexibility program simplification innovation
10 What Won t Change CMS Remains Committed to Quality CMS Plans to Tie More Payments to Quality Metrics 90% of fee-for-service tied to quality metrics by 2018 CMS Plans to Have ½ of all Payments Tied to Alternate Models by 2018 Was 20% ($72.4 billion) paid through alternate models Reached 30% in 2016 The plan is to reach 50% by 2018 ($213 billion)
11 GOP ACA Repeal Efforts 1. Repeal several parts under budget reconciliation process 2. Separate legislation to address other issues for replacement: Medical Liability Association Health Plans Purchasing Across State Lines 3. Regulatory Action to Address What s Left
12 Enactment Process for Reconciliation House: the Energy and Commerce Committee the Ways and Means Committee the Budget Committee the Rules Committee House Floor Debate and Vote The House Passed the bill Senate: Receives the bill passed by the House Motion vote, to send the bill to the floor for a full vote Debate on the floor, amendments and eventual vote If the Senate version is different from the House passed version: The bill would then go back to the House for new consideration OR a Conference Committee will be appointed to work through the differences. Ultimately, House and Senate must pass identical versions then send to the President to sign into law.
13 Possible Repeal of the Affordable Care Act What is IN the ACA, which is a part of any likely repeal effort: Acute care: readmissions, VBP, infections Center for Medicare & Medicaid Innovation (CMMI) Accountable Care Organizations (ACOs) Medical Device Tax Medicaid Expansion Health Insurance Exchanges/Marketplaces What is NOT IN the ACA: EHR Meaningful Use MACRA Protecting Access to Medicare Act (PAMA) VBP for Post Acute Impact ACT
14 General Principles for GOP Reform Efforts Healthcare Tax Reform Most legislative efforts have sought to repeal taxes implemented by the ACA in The efforts have focused on repealing taxes on health insurance premiums, pharmaceutical manufactures, the medical device tax, and taxes on Flexible Spending and Health Savings Accounts (HSAs). Most efforts do not eliminate the Cadillac tax, but delays implementation until Several efforts have cut the 3.8% investment tax and a 0.9% surcharge on those earning more than $250,000. Health Savings Accounts (HSAs) Common agreements are that maximum contribution limits would increase, spouses could make catch-up contributions to one HSA, and the tax penalty for non-qualified expenses would decrease. Medicaid Reform Most versions have sought to roll back the ACA s Medicaid expansion, but the timing varies. Amendments to the original bill in the House were designed to grandfather in those who were enrolled in Medicaid through the expansion, prior to December 31, This component has been a major sticking point on the Senate side and has almost singlehandedly derailed the entire effort.
15 Challenges for the GOP Efforts By The Numbers CBO Budget Score for the legislation the House passed. 14 million fewer people will be insured one year after passage. 23 million fewer will be insured in 10 years. Cuts spending on Medicaid by $834 billion. Premiums will go up in 2018 and 2019 variations thereafter. Premiums would decline by 20% over a decade in states that waive Obamacare rules. 1 of 6 Americans will live in an area with an unstable insurance market in 2020 where sick people could have trouble finding coverage, but 5 out of 6 would have access to relatively stable markets. The average 64-year-old earning just above the poverty line would have to pay about 9 times more in premiums. In 2026, 51 million people under age 65 would be uninsured almost twice as many as the 28 million who would have lacked coverage under Obamacare. The bill will save $119 billion - $32 billion less than a previous version of AHCA. It repeals $664 billion worth of taxes and fees that had financed Obamacare.
16 Challenges for the GOP Efforts Lack of Industry Support Lack of Conservative/Moderate Support Lack of Consensus Between House and Senate Messaging, Messaging, Messaging
17 What s Next for Healthcare Sen. Majority Leader Mitch McConnell (R-KY) announced he will hold a vote on moving to proceed to the House Reconciliation Bill early this week. The White House asked for the additional time as they are trying bring all 51/52 Republicans in line on the issue, via policy changes and assurances. Sen. John McCain s absence is felt considerably, given the closeness of all votes in the Senate. At this point, from talking to Members/staff, the expectation is the motion to proceed next week will be defeated. However, if successful on the motion to proceed McConnell has said the first amendment he will offer up is the repeal language passed in Sen. Susan Collins (R-ME) is the only current Senate Republican who voted No in 2015 on the repeal language. Before lunch on Tuesday 3 Senate Republicans said they will vote no on the motion to proceed Sen. Susan Collins (R-ME), Sen. Shelly Moore Capito (R- WV) and Sen. Lisa Murkowski (R-AK). If these three members stay firm Nos the motion will be defeated. McConnell has no room for error. He must get 50 Republicans to support, which then allows VP Pence to vote to get on the bill.
18 Where Does the GOP Go from Here? Expect several groups of members partisan, bipartisan and even bicameral to start trying to fill the void and work towards ideas/solutions. Sen. Joe Manchin (D-WV) has already been working to get the bipartisan former Governors in the Senate together. Likely Sen. Bill Cassidy (R-LA)/Sen. Susan Collins (R-ME) get going again. If you are a Senate Democrat, from a Red state, and up in 2018 you will likely be a part of any kind of working group. Unclear at this point if and when the Administration decides to engage Minority Leader Chuck Schumer (D-NY) on a bipartisan compromise bill, if they even do at all. Reality check until someone can show Leader McConnell they have language which can achieve 60 votes or a pathway to passage, the entire healthcare effort will continue to be in a holding pattern.
19 Where Does the GOP Go from Here? Options the Senate Could Consider While Waiting on Healthcare Nominations currently there are over 40 nominations that have been reported out of Committee and are awaiting floor action. FDA User Fees the House-passed bill, HR 2430, has been Rule 14 d on the Senate Calendar and is ready for floor action. Potential consideration of the FBI Director nominee, Chris Wray. Potential consideration of Debt Ceiling legislation this will depend on the final word they get from Treasury and also where the caucus is in the wake of healthcare reform fatigue. August Recess is set to begin on Friday July 28 th However, McConnell has told the Senate (before McCain s diagnosis) to plan to stick around for the first 2 weeks of August and adjourn on August 11th. How this plays out is still very much up in the air.
20 Trump s First 100 Days
21 Ratings Aren t Everything... Or Are They?
22 First 100 Days
23 First 100 Days
24 First 100 Days
25 First 100 Days
26 HIDA Policy/Political/Regulatory Updates The HIDA Government Affairs staff is compiling information as it becomes available and releasing a series of factsheets outlining the impact of the ever changing political, policy and regulatory landscape on the healthcare industry and supply chain. How the new Administration is impacting the healthcare space, the changing priorities on Capitol Hill and ultimately what changes are coming to our industry as a result of it all are our key focus, and we are producing them as new information surfaces. If you have not seen one of our Policy/Regulatory/Political Insight documents and are interested in receiving them, please reach out to either Mary Beth Spencer (spencer@hida.org) or Josh Babb (babb@hida.org).
27 Thank You Josh Babb Director, Government Affairs Health Industry Distributors Association (HIDA)
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