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Can’t They All Just Get Along?

11/12/18

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By:

Shoshana Krilow, Vice President, Public Policy and Government Relations

If last Tuesday’s election results are any indication, then the answer to that is a solid “maybe.” While the 2018 midterms produced some confusing results, they did offer some clarity with respect to health care policy.

First, a recap

Democrats will soon control the U.S. House of Representatives and Republicans maintained control of the U.S. Senate (and increased their majority slightly). As of today, Democrats flipped seven state governorships while Republicans appear to have held onto several that were highly contested. It was not QUITE the “blue wave” that some expected, but it was still a good night for Democrats in claiming the House majority and expanding the number of governorships they hold. Veteran members Rep. Frank Pallone (D-N.J.) and Rep. Richard Neal (D-Mass.) will likely control the powerful House Energy and Commerce and Ways and Means Committees, respectively, which have jurisdiction over most health care legislation. While Sen. Chuck Grassley (R-Iowa) could take the reins again of the Senate Finance Committee.

So what does that all mean for health care, in particular?

Unfortunately, nothing that happened last week is going to necessarily reduce the amount of partisan bickering both on and off Capitol Hill. And, with a divided government, it will ostensibly be even more difficult to pass any substantial legislation (which could be considered a good thing, depending on the issue and your position on it). That said, there may actually be some common ground between the parties (rising prescription drug costs, for one) if we could take the politics out of the policy. But, alas, the two are inextricably linked, so even where there is agreement on the problem, the solutions often break down along party lines.

With a slightly clearer crystal ball …

Threats to the 340B Drug Pricing Program will lessen, as Democrats have reliably been much more supportive of the Program than Republicans, and most of the scrutiny has been happening in the GOP-led House. The Senate has paid far less attention to the Program, and its appetite will likely lessen with a Democratic House uninterested in modifying 340B. That’s not to say, however, that the administration (Health and Human Services) will cease their aggressive regulatory approach to the Program (possibly necessitating SOME compromise in Congress to combat those efforts).

Repeal of the Affordable Care Act (ACA) is officially OFF the table for the next two years, even if Republicans continue to build on their majority in the Senate, as the House, under probable-Speaker Nancy Pelosi, would never put that vote on the floor. 

Meanwhile, it seems certain that the administration will continue its efforts to weaken the law via administrative actions and the formal rulemaking process. At the same time, you can expect that the House will exercise significant oversight authority over the administration – on everything from Medicaid work requirements, to previous and future efforts that undermine the ACA (among many other non-health care items like the President’s taxes and Russia). And, despite the campaign lip service, and even a potential vote on the House floor, Medicare-for-all continues to be highly unlikely. 

The crystal ball remains a bit cloudy where the parties may actually work together. Republicans and Democrats have both indicated their frustration with rising prescription drug prices, but have yet to find a policy solution they both can agree on as a way to rein them in. Many of the policies being put forth by the administration have actually been potentially too aggressive for both Republican and Democratic lawmakers, and Democrats in the House may be unwilling to deal the President a win on an issue that could potentially help him with voters in 2020. While Congress may not reach an agreement, we can expect to see hearings on drug pricing and on the drug supply chain overall (PBMs will probably stay in the line of fire), but significant legislation on this issue remains doubtful. 

Finding common ground

Health care costs, generally, are a concern of both parties but, again, common ground may be difficult to find. While an expansive topic with significant implications in both the health care delivery system and supply chain, transparency may be a focus area with both parties encouraging a greater understanding of what the actual costs of health care are. With the administration also pushing for greater transparency (so far targeting hospitals and pharmaceutical manufacturers to publicly post prices), the federal agencies don’t seem likely to back down. In Congress, this could also include a more direct effort to develop legislation that would protect patients from “surprise” medical bills caused by out-of-network providers at an in-network facility or in emergency situations.

Other potential areas of agreement tend to be more technical than partisan. Those may include continued efforts to reform the Stark and anti-kickback laws to provide added flexibility for health care providers to develop value-based payment and delivery systems. Additionally, although Republicans in Congress have been somewhat resistant to opposing the administration’s regulatory efforts, they may find some cover in a Democratic-controlled House, and could find some issues (like site-neutral payment policies for providers) to work together on – going against an administration that has been quite aggressive via its rulemaking authority.

Is there such a thing as a sure thing?

Perhaps the closest we can get to a sure thing for health care will be at the state level, where several new Democratic governors will pursue Medicaid expansion – something the administration must grant (if states comply with all requirements) despite its opposition to it. That said, state legislatures may not all be in agreement with their governors, so some battles are still far from over.

Finally, with the repeal of the ACA off the table, it seems plausible that House Democrats will aggressively pursue efforts to shore up the ACA’s health insurance markets (with the goal of reducing premiums, co-pays and deductibles) and protect coverage for those with pre-existing conditions. While Senate Republicans may not be inclined to support those efforts, they may ultimately engage given their interest in the same outcomes and to ensure that these talking points aren’t once again used against them 722 days from now. But who’s counting? 

Compromise hasn’t always been a dirty word … and although there are certainly areas of agreement with a glimmer of hope for a more cooperative future, it’s doubtful that either party will be uttering “Help me help you” anytime soon.

About the author. As vice president of public policy and government relations, Shoshana Krilow leads Vizient’s government relations, monitoring federal legislative and regulatory developments of importance to Vizient and its members. She has worked as a strategic advisor to health sector clients with a particular concentration on Medicare, the pharmaceutical and insurance industries, and the Affordable Care Act. Krilow also brings deep legislative expertise having spent several years on Capitol Hill, where she worked as a health policy advisor for Representative Marion Berry (D-Ark.) and Senator Joseph Lieberman (I-Conn.).

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