OPENING SALVO — Republicans made their opening pitch to Democrats for health provisions in an end-of-year package this week. That Tuesday proposal included a three-year reauthorization of soon-to-expire telehealth and hospital-at-home rules for Medicare patients, flat funding for community health centers and full reauthorizations of the opioid-fighting SUPPORT Act and the Pandemic and All-Hazards Preparedness Act. It also includes a 2.5 percent bump to doctor Medicare payments for 2025 to patch cuts. The GOP has leverage in the talks because Republicans are set to gain control of the White House and Senate to go with their current House majority next year, giving them greater power to shape funding legislation. Republicans propose to pay for it by repealing a Biden-era rule to increase nursing home staffing, a move they had already planned for next year. The repeal could save tens of billions of dollars, according to the Congressional Budget Office, the nonpartisan scorekeeper on the financial effects of legislation, likely because it would reduce Medicare and Medicaid costs. It’s unclear whether the proposed pay-fors would cover the costs of the Republicans’ priorities, but they could come close. All that could still be difficult for Democrats to stomach, especially on a short timeline. One person granted anonymity to discuss the negotiations told POLITICO that Republicans gave Democrats a Friday deadline to counter. “Both sides are still pretty far apart,” one lobbyist granted anonymity to discuss the negotiations said. “Flat funding for [community health centers] will be a nonstarter for Dems.” Details like the specifics of what to do in areas like telehealth will also need to be worked out, including whether to establish payment parity for federally qualified health centers and rural health clinics for in-person and virtual care. Nearly half the Senate, led by Sen. Brian Schatz (D-Hawaii), and dozens of House members called on leadership Wednesday to extend Medicare coverage “as much as possible” and avert policies that “create barriers to care.” GOP DIVISION OVER RECONCILIATION — Fissures are already emerging among Republicans over sweeping legislation known as a reconciliation package that would be key to implementing President-elect Donald Trump’s agenda, POLITICO’s Jordain Carney, Benjamin Guggenheim and Olivia Beavers report. Under budget reconciliation rules, the GOP — which will have control of the House and the Senate next year — can pass legislation with a simple majority. Republicans have eyed Medicaid reform to help pay for their agenda, including extending Trump-era tax cuts. Senate Majority Leader John Thune told GOP senators this week that the package would be divided in two. The first part would focus on border and energy, with a goal to pass it within the first 30 days of the new Trump administration, and the second part on tax. House Speaker Mike Johnson has backed that strategy, but key Republicans are raising red flags. “Our members need to weigh in on that. This doesn’t need to be a decision that’s made up on high, OK?” said House Budget Chair Jodey Arrington (R-Texas) about the two-step strategy. SITE NEUTRAL UPDATE — Sen. Maggie Hassan (D-N.H.), who is working on site-neutral payment reform with Sen. Bill Cassidy (R-La.), the incoming HELP Committee Chair, said Wednesday that she’s gotten a “lot of pushback” from hospitals about the proposal but says it has received “a lot of interest.” Hassan’s comments suggest that the proposal is more likely to move in the next Congress than this one. Cassidy and Hassan released a concept proposal last month that would stop Medicare from paying hospitals more than they do doctors’ offices for the same care. At an event Wednesday hosted by Duke University’s Sanford School of Public Policy alongside former Sen. Richard Burr (R-N.C.), Hassan emphasized provisions intended to help rural hospitals. Concerns about detrimental financial impacts on rural hospitals have been a key roadblock for site-neutral payment changes. Given the potential savings in Medicare spending the proposal could provide, it could be a target for a budget reconciliation package in the next Congress. Also in site-neutral: A reminder that POLITICO is hosting an event with Hassan, Cassidy and other health care leaders on site-neutral payment reform on Wednesday. You can register and learn more here. Burr update: Burr, who works at law and lobbying firm DLA Piper, noted Wednesday that his two-year prohibition on lobbying after leaving office in early 2022 expires soon, saying he will shortly be on Capitol Hill pushing to reauthorize the Pandemic and All-Hazards Preparedness Act, which he first rolled out in 2006.
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