HEALTH CARE BRIEFING: Democrats’ Drug-Pricing Fault Lines Emerge

Democrats remain at odds over how to design legislation to allow the government to negotiate for lower drug prices, a divide that may keep a solution out of their sweeping domestic policy package.

The White House omitted measures meant to lower drug prices from its framework for a $1.75 trillion domestic spending package released yesterday. There isn’t enough agreement among Democrats on drug price negotiation to include it in the framework, a Biden administration official told reporters yesterday.

The fault lines were on display as lawmakers rush to reach a deal to get it back into the package (advancing in the House as H.R. 5376).

Sen. Kyrsten Sinema (D-Ariz.) has sought to limit negotiations to just drugs in Medicare Part B, the outpatient service, that aren’t under patent protections, according to a person familiar.

Ron Wyden (D-Ore.), chairman of the Senate Finance Committee, said he wants negotiations to include Part D, the prescription drug benefit, as well as Part B. “That’s where seniors live and they see it in line at the pharmacy counter,” he said.

Two House aides, including a senior staffer on the Energy and Commerce Committee, said they don’t think a drug pricing package that includes just Part B or off-patent drug negotiations could pass the House. The concern is that it could lead to more patient gaming by drugmakers, which don’t want their products to face negotiations. Read more from Alex Ruoff.

“We’re still trying to get drug pricing included in the bill,” Frank Pallone (D-N.J.), chair of the House Energy and Commerce Committee, told reporters earlier yesterday. Sen. Wyden also said drug pricing remains “an active issue.” The framework does call for saving the government $145 billion by repealing a Trump-era regulation that would have limited drug rebates. That regulation was never put in place. Read more from Alex Ruoff and Courtney Rozen.

Despite the rough draft of legislation House Democrats released yesterday after Biden’s framework, it likely will take days or even weeks before it might be ready for a vote as Congressional Democrats begin a new round of haggling and fill in details of the deal. Neither the House nor Senate is scheduled to be in session today but negotiations were set to continue through the weekend.

In a setback for Speaker Nancy Pelosi (D-Calif.), House progressives again blocked a vote on a separate infrastructure bill, a second piece of Biden’s agenda, until the larger package is ready. But the Biden framework triggered movement forward in the House when progressives formally endorsed a bill that is half the size they originally wanted. Read more from Billy House and Erik Wasson.

Happening on the Hill

Senate Confirms Biden Drug Czar: The Senate yesterday confirmed Rahul Gupta as director of the Office of National Drug Control Policy on a voice vote. He’ll be first physician to hold role of drug czar, with authority over dozens of agencies that deal with drug addiction and enforcement. Gupta’s biggest task will be tackling the opioid epidemic, Fawn Johnson reports.

HHS Blamed for Allowing Abuse of Migrant Children: The federal office responsible for unaccompanied migrant children suffers from chronic mismanagement and poor oversight that puts minors at risk, according to a bipartisan Senate investigation. Sens. Ron Wyden (D-Ore.) and Chuck Grassley (R-Iowa) released the report yesterday, concluding that the Department of Health and Human Services’ Office of Refugee Resettlement failed to conduct “basic oversight” of federally funded facilities that care for migrant children. The investigation examined data from 2014 to 2020, but is sure to intensify scrutiny of the Biden administration’s oversight of the program. Read more from Ellen M. Gilmer.

The Coronavirus Pandemic

Rule Will Let Employers Make Workers Pay for Tests: The Biden administration’s highly anticipated vaccine mandate rule for private-sector employers will allow businesses to force workers who refuse to get the Covid-19 shot to pay for required weekly tests and masks, two sources familiar with the matter said.

The emergency rule, which will apply to companies with at least 100 employees and is expected to be released next week, will give employers the option of paying for testing and masks for unvaccinated workers or compelling those employees to foot the bill themselves, according to the sources, who requested anonymity because they didn’t have approval to discuss the rulemaking. Read more from Ben Penn.

EEOC Releases Covid-19 Request Template: The EEOC published a sample form that employers can use for religious accommodation requests from workers, which have risen as Covid-19 vaccine mandates proliferate in the workplace. The Equal Employment Opportunity Commission’s template is the same one the agency uses for its own employees, and was part of an update yesterday to guidance on discrimination issues during the pandemic. Read more from Erin Mulvaney.

Florida Sues Biden Over Contractor Vaccine Mandate: Florida sued the Biden administration over vaccine mandates for federal contractors, the latest in a wave of Republican pushback against the president’s orders to fight the pandemic. In a federal lawsuit filed today in Tampa, the state called vaccination requirements for government contractors a “radical intrusion on the personal autonomy of American workers.” It alleges that the administration issued the mandate based on a law that doesn’t give it such power. Read more from Jonathan Levin.

Fake Vaccine Cards Pose Enforcement Challenge: Fake Covid-19 vaccine cards are presenting a fresh quandary for enforcement efforts: Unlike most consumer fraud, neither the buyer nor seller is taking advantage of the other. From August to September, the number of sellers on the darknet and hacking forums offering forged vaccination records or test results went from about 1,000 to 10,000, according to cybersecurity firm Check Point Research. Read more from Andrew Vittorio, Christopher Brown and Jake Holland.

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What Else to Know

Final 2022 Medicare Dialysis Payment Rule Cleared: A final rule dictating 2022 Medicare payment rates for dialysis cleared White House review and could publish at any time. The proposed rule (RIN 0938-AU39) called for a 1.2% increase for freestanding kidney care centers and a 1.3% bump for hospital-based dialysis. For people with kidney failure, known also as end-stage renal disease, dialysis machines replace the filtering function of the failed organ. Read more from Fawn Johnson.

HHS Moves to Undo Trump’s Retrospective Review: The Health and Human Services Department on Thursday moved to withdraw or repeal a last-minute Trump administration rule that would have caused health regulations to expire if they weren’t reviewed every 10 years. The HHS released a proposal that would do away with the rule, (RIN 0991-AC24), which was published in the Federal Register on Jan. 19, one day before Biden took office. Under the rule, the HHS would have had five years to assess regulations that are more than 10 years old, and the department could have extended that deadline one time per regulation, for up to a year. Read more from Shira Stein.

DOJ’s Dismissal of Medicare Fraud Suit Backed in Appeal: The Justice Department reasonably sought dismissal of a whistleblower suit accusing Medicare compliance company Executive Health Resources of violating the False Claims Act by falsely designating patient admissions, the Third Circuit affirmed today. In doing so, the U.S. Court of Appeals for the Third Circuit sided with the Seventh Circuit’s approach to government dismissal power under the FCA, further solidifying a three-way circuit split on the matter. Read more from Daniel Seiden.

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To contact the reporter on this story: Michaela Ross in Washington at mross@bgov.com

To contact the editors responsible for this story: Zachary Sherwood at zsherwood@bgov.com; Giuseppe Macri at gmacri@bgov.com; Brandon Lee at blee@bgov.com

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