| | | | |  | | By Ben Leonard and Chelsea Cirruzzo | | | | | 
North Carolina's state health plan will no longer cover weight-loss drugs like Wegovy because of its high cost. | Amanda Andrade-Rhoades/AP | ‘ALL OR NOTHING’ — As employers across the country grapple with how to cover costly weight-loss drugs like Ozempic and Wegovy, pushback from drugmakers and the pharmaceutical middlemen that negotiate drug costs is making the decision even harder, POLITICO’s Kelly Hooper reports. North Carolina’s state health plan voted to end coverage of weight-loss drugs Wegovy and Saxenda in January, citing concerns that costs could balloon to more than $1 billion over the next six years. That means the 750,000 public employees enrolled in the plan must pay out of pocket for access to the drugs. And the state, the drugmakers and the state’s pharmacy benefit manager, CVS Caremark, blame each other. “The contracts between the manufacturers and the [pharmacy benefit managers] are all-or-nothing,” said Sam Watts, the North Carolina state health plan’s administrator. “I’ve got to take it or leave it. I have to pay for everybody, even the folks for whom it is not cost-effective, in order to get it for the folks it would be cost-effective for.” Background: Before ending coverage, North Carolina had floated plans that would limit prescriptions of weight-loss drugs to patients who first tried lifestyle management programs to lose weight. But the manufacturer and CVS Caremark said the state would have to pay the full list price for the drugs unless it agreed to allow all patients with a prescription to get the drugs without any preliminary hurdles — in which case the state could get rebates amounting to a 40 percent discount. The situation in North Carolina is playing out across the U.S. as large employers try to limit the costs of the expensive new generation of weight-loss drugs, according to large employer coalitions. The blame game: CVS Caremark pointed the finger at Wegovy’s and Saxenda’s manufacturer, Novo Nordisk, saying the company can “choose to lower the price of these medicines today and offer relief to the State Health Plan.” And Novo Nordisk accuses the state health plan of intervening in private medical decisions. A spokesperson told POLITICO that patients shouldn’t have to “demonstrate broad cost-savings to the entire healthcare system before they can access medically proven treatment options.” The bottom line: Health economists say the situation is characteristic of how drug prices are determined in the U.S. — where manufacturers hold a lot of clout and pharmacy benefit managers are charged with enforcing that power in negotiations with employers — which can end up keeping patients from gaining access to highly effective treatments. WELCOME TO THURSDAY PULSE. It’s officially obsessively-watch-the-Federal Register-season for all who practice. Reach us and send us your tips, news and scoops at bleonard@politico.com or ccirruzzo@politico.com. Follow along @_BenLeonard_ and @ChelseaCirruzzo.
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The White House wants to expand the protections of HIPAA to protect people who seek, obtain or provide abortions. | Charlie Riedel/AP | ABORTION PRIVACY RULES COMING — The Biden administration plans to finalize a proposal to tighten privacy regulations to safeguard abortion data next week, an administration official told POLITICO. The White House Office of Management and Budget has wrapped up a review of the proposal, which would expand health privacy law HIPAA to protect people who seek, obtain or provide abortions from law enforcement. It’s one of the most substantial proposals the administration has made to protect abortion access in the wake of the Dobbs decision that turned abortion rights back to the states. The proposal would prevent providers and insurers from turning over information to state officials investigating or prosecuting someone seeking or providing a legal abortion and offer additional protection for people crossing state lines for the procedure. Conservatives have eyed legal challenges to the proposal, arguing it oversteps agency authority, while some Congressional Democrats have said it doesn't do enough. Some leading Democrats have pushed the administration to require law enforcement to obtain a warrant to compel providers to comply. The proposal as written would hold state officials to a lower threshold. The bigger picture: This is the latest sign that the administration is wrapping up its regulatory work ahead of a key deadline: If agency regulations aren’t finalized in the coming weeks, a Trump administration and Republican-led Congress could overturn them using the Congressional Review Act. The deadline hinges on Congress’ calendar and will likely be in the late spring or summer. OMB this week also finished reviewing a minimum staffing mandate for nursing homes and a rule to bolster Medicaid access and transparency in the program. ARIZONA ABORTION BAN REPEAL FAILS — Arizona Republicans stymied an attempt to repeal an 1864 abortion ban that the state’s high court brought back last week, resisting former President Donald Trump’s push to nix the law, POLITICO’s Megan Messerly reports. The move Wednesday was a blow to Trump and Senate hopeful Kari Lake, who called GOP lawmakers and pushed them to repeal the ban. Both Trump and Lake sensed the ban could be politically fraught for them as Republicans have struggled with abortion post-Dobbs. The situation threatens to leave the issue — which Trump hoped to put behind him — unresolved. “I think it’ll be straightened out, and as you know, it’s all about state’s rights,” Trump said last week. The bigger picture: The move underscores the divide between the more socially conservative faction in the GOP opposing abortion on moral grounds and the more populist branch, including Trump, that is eyeing a more politically pragmatic approach.
| | BECERRA GOES TO THE HILL — Over two days of hearings, HHS Secretary Xavier Becerra defended the administration’s push to extend health insurance tax credits in its proposed fiscal 2025 budget while Republicans criticized spending asks by HHS they say will raise taxes. In his responses, Becerra stuck to Biden administration talking points that Medicare drug price negotiations and permanent premium tax credits will drive down health care costs. The secretary testified before the Senate Appropriations Committee and the House Energy and Commerce Health Subcommittee this week to tout his department’s fiscal 2025 budget proposal. Here are key takeaways and lines of questioning from the hearings: — Inflation Reduction Act: Some Republicans on the E&C Health Subcommittee criticized provisions in the budget to expand upon provisions in the Inflation Reduction Act, which include extending the insulin cap to commercial insurance and increasing the number of drugs subject to price negotiations. Full committee Chair Cathy McMorris Rodgers (R-Wash.) asked how much money from premium tax credits would go toward insurance companies, which Becerra conceded will “flow through the insurance companies,” but he didn’t give an exact number. Reps. Buddy Carter (R-Ga.) and Bob Latta (R-Ohio) echoed concerns about the Medicare drug price negotiations by drug companies and some rare disease advocacy groups, who say the talks will stifle the development of drugs for rare diseases. Becerra pushed back, saying the department encourages the development of these drugs. — Menthol ban: Becerra said the administration’s proposed menthol cigarette ban is still “in the process,” but he couldn’t give a “particular timeline” when Rep. Robin Kelly (D-Ill.) asked for a status update. The proposed rule has yet to receive the green light from the White House, prompting worries from advocates both inside and outside of the administration that it’s unlikely to be finalized before the November election. — Telehealth: During questioning, the secretary urged Congress to make permanent the telehealth flexibilities that expanded access to telehealth during the height of the pandemic before they expire at the end of this year. “We are absolutely counting on Congress before the end of this calendar year to come up with some telehealth solutions,” Becerra told senators after being questioned about expanding access to health care in rural areas.
| | | | Nirosha Lederer is now head of biopharmaceuticals policy evidence at AstraZeneca. She was vice president of U.S. federal government at Aetion. The New York State Department of Health has added Dr. Elizabeth Whalen as medical director in its Office of Public Health and Dr. Patricia Schnabel Ruppert as medical director of its Center for Environmental Health. Whalen was previously commissioner of the Albany County Department of Health, and Ruppert was previously commissioner of health in Rockland County, New York.
| | POLITICO’s Hailey Fuchs reports on China lobbying Congress behind closed doors on TikTok. STAT reports on the next frontier in data privacy possibly being in the brain. POLITICO’s Ruth Reader reports on E&C ranking member Frank Pallone (D-N.J.) holding out for tougher social media legislation.
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