News: A government shutdown? HHS has a plan.

Thursday, September 19, 2024

A government shutdown? HHS has a plan.

Sep 19, 2024

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By Chelsea Cirruzzo and Ben Leonard

Presented by The American Hospital Association

Driving The Day

Speaker of the House Mike Johnson walks through a hallway with the press.

House Speaker Mike Johnson's efforts to prevent a government shutdown were thwarted on Wednesday. | Angelina Katsanis/POLITICO

IN THE EVENT OF A SHUTDOWN — An attempt to avert a government shutdown was quashed Wednesday, leaving Congress just 12 days to pass a funding patch to keep the government open.

House Speaker Mike Johnson spent the weekend trying to rally his party to support a short-term funding plan that would keep the government open through the end of March. The vote’s failure means House Republicans would likely have to team up with Democrats to pass an even shorter funding patch through December, POLITICO’s Jordain Carney, Olivia Beavers and Sarah Ferris report.

House Republicans have proposed funding patches that keep HHS funding level and don’t include additional funding requested by the White House for respiratory illness surveillance and to continue efforts to overhaul the organ transplant system.

When asked about the possibility of a shutdown — which seems unlikely so far — an HHS spokesperson directed Pulse to a 2024 contingency plan. Here’s what would happen:

— 45 percent of HHS’ staff would be furloughed. Staff that would continue working include more than 15,000 workers at the Indian Health Service, staff that operates mandatory programs like Medicare and Medicaid, more than 400 workers who protect computer data and staff that provides direct care to patients.

— Covid-19 operations, including surveillance efforts and drug development, would continue using any HHS carryover balances, third-party funding and user fees. HHS will rely on exceptions in the Antideficiency Act, which lets the department maintain some services if they protect human life. “[T]he Administration for Strategic Preparedness and Response will maintain the minimal readiness for all hazards, such as COVID-19, flu, and hurricane responses,” the plan reads.

— HealthCare.gov would remain open, but funding for Medicaid could get rocky. Late last year, HHS said it could fund Medicaid for only the first quarter of fiscal 2024 in case of a shutdown. HHS didn’t respond to inquiries about fiscal 2025.

— The Health Resources and Services Administration would have to rely on carryover balances to keep programs, including the Ryan White HIV/AIDS Program, running for “a limited amount of time.”

— The National Institutes of Health would continue providing treatment to patients at its clinical center in Bethesda, Maryland, but would have to operate at 90 percent of its normal patient load to care for existing patients first.

WELCOME TO THURSDAY PULSE. The cast of the D.C. season of Netflix’s “Love is Blind” has been revealed, and while there are no Hill staffers or lobbyists, there is a medical-device salesperson. Send your tips, scoops and feedback to ccirruzzo@politico.com and bleonard@politico.com and follow along @ChelseaCirruzzo and @_BenLeonard_.

A message from The American Hospital Association:

Hospitals care for patients and keep communities healthy. But access to care is at risk. Tell Congress to protect patient access to care and services. Learn more: https://www.aha.org/advocacy/action-center

In Congress

Rep. Buddy Carter (R-Ga.).

The Energy and Commerce Committee advanced a bill cosponsored by Rep. Buddy Carter that would allow Medicare to continue paying for telehealth visits. | House Energy and Commerce Committee/YouTube

HEALTH BILLS ADVANCE — Several health care bills and a resolution to overturn a Biden administration regulation passed out of the House Energy and Commerce Committee on Wednesday, Ben reports.

Here are four takeaways from Wednesday’s markups:

— Telehealth questions remain: In a unanimous vote, lawmakers advanced an amended version of the bipartisan Telehealth Modernization Act from Reps. Buddy Carter (R-Ga.) and Lisa Blunt Rochester (D-Del.) that would extend loosened Medicare telehealth rules for two years. The rules are scheduled to expire at year’s end.

But key questions remain, including how much the legislation will cost and whether the Ways and Means and E&C committees can reconcile their differences.

— Priority review voucher dispute resolved, for now: An amended bill to reauthorize the FDA’s priority review voucher program for rare pediatric diseases was approved.

Still, despite the vote, some Democrats worry about the reauthorization of the program, which expires at the end of the month. The legislation would reauthorize the program for five years.

— Staffing mandate challenge faces headwinds: The panel advanced a resolution to overturn the Biden administration’s controversial minimum staffing mandate for nursing homes along party lines.

The Biden administration issued the rule to help promote better care and safety for residents. The rule, released in May, is estimated to cost nursing homes $43 billion over the next decade, according to CMS, and has drawn significant backlash from the nursing home industry and Republicans.

Without significant Democratic support, the path forward for the bill likely hinges on the November elections’ outcome.

A BILL TO PROTECT KIDS IN FLUX — The House E&C Committee approved a bill Wednesday to protect the health of kids using social media, but there’s doubt as to whether the bill will be enacted into law this year, POLITICO’s Ruth Reader and Alfred Ng report.

This comes after the Senate passed the Kids Online Safety Act and the Children and Teens’ Online Privacy Protection Act by a 91-3 vote in July.

But the House version of the Kids Online Safety Act is significantly different than the Senate’s, and the panel’s top Democrat, Frank Pallone (D-N.J.), said the House’s Children and Teens’ Online Privacy Protection Act was too weak.

The committee approved both acts by voice vote.

An amendment to the Kids Online Safety Act worked out by Republican leaders and released to the panel Tuesday changed language establishing a “duty of care” that requires social media companies to reasonably safeguard children from content that could harm their mental health.

The chief sponsor of the House bill, Florida Republican Gus Bilirakis , warned that the original language would have opened up the measure to challenge by tech interests on First Amendment grounds. He and E&C Chair Cathy McMorris Rodgers (R-Wash.) urged colleagues to vote yes and then negotiate a compromise deal with the Senate.

A message from The American Hospital Association:

PHARMA WATCH

FIRST IN PULSE: NEW APPROACH TO PBMS — The ERISA Industry Committee, which represents the benefit interests of large employers, is calling for a new legal approach to rein in pharmacy benefit managers amid widespread scrutiny of their business practices in Congress, Ben reports.

In a report first obtained by Pulse, the group calls on Congress to deem PBMs, which negotiate drug prices on behalf of insurers and employers, as fiduciaries under 1974’s Employee Retirement Income Security Act. That would hold them to the same responsibilities as employer-plan sponsors, which are obligated to control costs, act in the best interest of plan participants and not self-deal.

PCMA, which represents PBMs, has previously said that such a designation would limit the options available for PBM customers and undermine PBMs’ ability to ensure affordable drug benefits for consumers.

The broader picture: The move comes after a class action suit in February claimed pharmaceutical giant Johnson & Johnson mismanaged its employees’ prescription-drug benefits program in what appears to be the first lawsuit claiming a company didn’t properly manage its employee health plan. It was the first lawsuit to stem from law firms eyeing class actions against employers who allegedly fail to comply with ERISA.

The suit claimed that J&J didn’t shop around for a more cost-effective option before selecting its PBM. J&J has argued that the legal theory and allegations are meritless.

ERIC said in its report that if PBMs are required to follow fiduciary duties, “many of the PBM practices” in lawsuits would be “mitigated if not eliminated entirely.”

Artificial Intelligence

ASSESSING AI — Labs to vet artificial intelligence tools that fall out of the FDA’s regulatory scope are coming, Micky Tripathi, HHS’ assistant secretary for technology policy and acting chief AI officer, forecasted during POLITICO’s Future of Patient Care and Access event in Washington on Wednesday.

Whether the AI assurance labs should be private, public-private partnerships or government certified is an open question, Tripathi said, adding that he’s waiting for AI developers and purchasers to reach a consensus on what the vetting process should include.

Why it matters: FDA chief Robert Califf said earlier this year that his agency does not have the staffing to monitor AI tools that evolve as they take in more data.

What’s next? According to Tripathi, HHS is closely following a number of private sector-led efforts and the department is also working on a strategic plan as directed by President Joe Biden in his AI executive order last year.

Names in the News

Dr. Mary B. Rice is now director of the Center for Climate, Health, and the Global Environment at the Harvard T.H. Chan’s School of Public Health. She’s also now an associate professor of environmental respiratory health. She has been an associate professor of medicine at Harvard Medical School and a physician at Beth Israel Deaconess Medical Center.

WHAT WE'RE READING

The New York Times reports on a new study highlighting the links between cancer and alcohol.

STAT reports that Ascension lost $1.3 billion during a recent cyberattack.

POLITICO’s Kelly Hooper reports on predictions by Humana’s CEO about industrywide Medicare Advantage benefit cuts.

A message from The American Hospital Association:

Hospitals care for patients and keep communities healthy. But access to care is at risk. Tell Congress to protect patient access to care and services.

Learn more: https://www.aha.org/advocacy/action-center