Divided Government in Washington? Political Fights Ahead, but Areas of Agreement Not Impossible to Imagine

by Steve Rixen

Vizient Senior Government Relations and Public Policy Director

It’s only days until election day, and it is officially the height of campaign season in Washington. Or perhaps more correctly, it is height of campaign season across the country as a relentless barrage of campaign ads pummel every state and congressional district leading up to the Nov. 8 mid-term elections.   

People who work in and around politics, like me, tend to warmly embrace the total invasion of TV commercial breaks, and the ceaseless calls, texts and emails, while trying to extrapolate meaning from the chaos. That includes, perhaps against my better judgment, prognosticating who will win, who will lose and by how much. With that in mind, let’s look at what I expect to happen in the November elections, and what it may mean for providers and health policy in the next Congress.  

But I should offer a disclaimer: I don’t have a crystal ball. This is my best guess based on polls, analysis, and conventional wisdom from inside the Beltway. Elections are unpredictable, and polls are often nowhere close to reality—they all include a margin of error for a reason! As the tired political adage goes: “The only poll that counts is the one on election day.”  

Is Republican Congressional Control Imminent? 

That adage is especially true this year, with geopolitical events, gas prices, inflation, and the economy all in a constant state of flux. But we can try to read the tea leaves and predict an election outcome based on common trends, including:  

• History (the President’s party almost ALWAYS loses seats – often quite a few – in the midterm),  
• The country’s mood about the performance of their elected representatives (generally pretty grumpy),  
• Presidential approval ratings (not particularly high),  
• Members of Congress announcing retirements or leaving to pursue other offices (which may make it more difficult for Democrats to maintain control),  
• Redistricting (while the gains or losses for either Republicans or Democrats is probably negligible, there will almost certainly be some unexpected outcomes as a result.) 

With the weight of all these factors, there is a clear belief in Washington that Republicans are expected to reclaim control of one or both chambers of Congress – with the House being the most likely to flip. 

What will GOP Control Mean in Washington?  

First, even if Republicans meet or exceed expectations and control both chambers of Congress, significant conservative-oriented reforms to the healthcare system are unlikely. President Biden will remain in the White House and retain veto power. We will have a divided government.  

The 60-vote requirement in the Senate to overcome a filibuster will also be a major roadblock to significant partisan achievements. While the reconciliation process, a special Senate process that side steps the filibuster, may be available for the Republican-led Congress, it is unlikely to be successfully used in divided government. These checks in our system of checks and balances will require Democrats and Republicans to work together to achieve…well, just about anything.  

Grand Bargains and Medicare Trust Fund Reforms? 

Efforts to reduce federal spending are often a focus during divided governments as that is often the only time compromise on government spending may be possible. In recent years, however, that has meant ugly political skirmishes and high-stakes political brinksmanship instead of grand bargains. That approach leads to risk of government shutdowns or breaching the debt ceiling – both items that would undermine the potential for any bipartisan cooperation and shift the debate to an acrimonious political conversation.  

While the difficult politics of reducing federal spending may make it unlikely that a grand bargain could be reached, that doesn’t mean considerable attention will not be directed at reducing healthcare spending. Medicare and Medicaid spending and the health of the Medicare Trust Fund will inevitably be a part of the conversation in a divided Congress – and provider reimbursement reductions, site-neutral payments, expanded price transparency efforts and other major reforms all could potentially be on the table.  

Those issues, among a range of others, have been clearly highlighted by House Republicans, who have been working over the last year to develop a health policy agenda through the Healthy Future Task Force.  More detailed information can be found on the proposals from the individual working groups (Modernization Solutions, Doctor-Patient Relationship Solutions, Affordability Solutions, Treatment Solutions, and Security Solutions), but some of the key, and possibly bipartisan – both positive and negative - highlights of the Healthy Future Task Force for providers include: 

• Ensuring appropriate oversight and reimbursement by continuing to build on site-neutral reimbursement in Medicare for services and prescription drugs, regardless of whether they are delivered in a physician office or hospital outpatient department, continued expansion of price transparency efforts and targeting inappropriate billing practices.   
• Reducing administrative burden by enacting reforms to prior authorization, easing burdensome mandates that take physicians away from patients, updating quality measure reporting requirements, ending the moratorium on physician-owned hospitals, and building off COVID-19 flexibilities to expand access to clinical trials.  
• Providing for continued access to telehealth services by ending originating site and geographic limitations, ensuring interoperable electronic health records, reducing required clicks for physicians, improving FDA approval and Medicare reimbursement for breakthrough drugs and devices. 

While there are some notable exceptions, the most important thing to recognize about many of the policies detailed by the Task Force is that they potentially could be accomplished during a divided Congress. Items like site-neutral reimbursement reforms for drugs and services and reforming inappropriate billing practices do not fall neatly into partisan buckets and could be designed in such a way to as to gain Democratic support.  

Another subject that doesn’t easily fit into a partisan bucket are potential reforms to the 340B Drug Pricing Program. While the program has widespread support across both parties, concerns remain as to how the savings from the 340B Program are used by covered entities, and whether covered entities are doing enough to support low-income patients and reporting critical data, among other challenges. In a GOP-led Congress, it is likely that 340B will face scrutiny from key committees and could face meaningful legislative reforms.  

While Washington can seem irredeemably broken, and there may be more evidence to that effect in some of the fights ahead, there can also be a surprising amount of bipartisanship on the technical policy issues affecting healthcare providers. While grand, sweeping reforms may not be in the cards in the era of divided government that is likely ahead, there will also likely be action on several health policy issues that could have significant impact for hospitals.  

Until those substantive debates begin though…you may want to mute the TV during all those political commercials. And then, be sure to vote on Nov. 8.