Healthcare Outlook: Issues on Deck for the Next Congress

October 29, 2018

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With the midterm election right around the corner, it’s a good time to review what Congress has accomplished so far in the healthcare realm, and what remains on the agenda for the next Congress. The incoming Congress most likely will build a healthcare agenda based on what the current Congress has not done, and with a perspective shaped by who wins control of the House and Senate. A divided legislature prior to a presidential election year may well mean a stalemate on several issues, resulting in bandage fixes instead of comprehensive legislative reform and initiatives.

Drug Pricing, Stark Reform, Opioids and Other Issues

The 115th Congress passed bipartisan legislation considered sweeping by some and, by others, a good first step to address the opioid epidemic. A product of multiple committees, the legislation expands capacity and addresses the development of non-opioid alternatives, among other measures.  

Congress also held dozens of hearing on the price, cost and access to drugs. Many hearings were sparked by concern over the cost of drugs and the role of pharmaceutical benefit managers (PBM), and Congress did pass legislation to eliminate “gag clauses” in contracts. This legislation, signed into law Oct. 10, allows pharmacists to tell patients that for some drugs, paying out of pocket would be less expensive than using their insurance. The law does not address a number of issues raised around drug prices and how to control them — issues that will be left for the next Congress to consider.

Some congressional leaders have said that, during the lame duck session that begins Nov. 13, the legislature may take up a pharma issue that was excluded from the passed opioid legislation. The excluded provision would reverse some of the liability for which brand-name drugs are currently responsible, in order to close the Medicare Part D “donut” hole.

Other healthcare issues Congress discussed include physician self-referral laws, or “Stark” laws. The House Ways and Means Committee and the House Energy and Commerce Committee have held hearings as they examine ways to reform these laws, which have become confusing and often are subject to many interpretations. The administration is also looking at this issue, and may well make a proposal before Congress can pass legislation. As they stand, Stark laws and regulations hamper and, in some cases, prevent the collaboration needed to find alternative payments and ways to control costs and improve quality.

Medicare and Medicaid Reform

This year, the House sent the Senate proposals to change Medicare and Medicaid, including premium support proposals for Medicare and for turning Medicaid into a block-granting program. The proposals failed to gain momentum in the Senate. The next Congress is likely to face issues around Medicare’s solvency and Medicaid spending, regardless of who controls either body and unrelated to the Affordable Care Act (ACA). However, wholesale reform rarely occurs before a presidential election year, which means Congress may try to act on large-scale reform, but end up with only minor changes to slow the growth of spending. 

Repealing the Affordable Care Act

Although lawmakers paid much attention to repealing, and sometimes replacing, the ACA, the last chance to repeal and replace ended Sept. 26, 2017, when the Senate could not move forward because it lacked the 50 votes needed to begin consideration of the legislation. Prior to this final failure, a trimmed-down version of repeal-and-replace failed July 28, 2017, with Sen. John McCain as the deciding vote. Despite these failures, the 2017 tax bill included language to eliminate penalties for the individual mandate, paving the way for a court case that could potentially wipe out the ACA.

Meanwhile, the administration promulgated rules to permit the creation of association health plans and lengthen the coverage period of short-term health plans, which reduced funding for navigators. The administration also announced that the exchange website would be down for maintenance on Sundays during a shortened open-enrollment period. Members of the Senate, led by Sen. Tammy Baldwin (D-Wis.), attempted to overturn the rule promulgated by the administration concerning short-term health plans, but failed to garner the simple majority required to move forward. 

The overall impact of these changes is that the next Congress likely will face the fallout of court decisions on key issues related to the ACA. Current cases include the constitutionality of the individual mandate, cost-sharing reduction issues and the association health-plan rule. If the individual mandate is found unconstitutional, courts also will need to decide if it is severable from the consumer protections contained in the ACA. The fallout from these cases will be addressed differently, dependent on the winners of the House and Senate in the midterm election. Regardless of court decisions, many in Congress view the individual market as an area that needs stability.

Up Next: Our analysis on court cases related to the Affordable Care Act, and how the midterm elections will affect what comes next.