Week in Washington: Rebate Rule, ACA Lawsuit Update, and Doings on the Hill

Week in Washington is brought to you by Michael Cohen, PhD. Tune in each week to read the latest on healthcare policy and get a glimpse of what’s on the horizon.

Week in Washington: Rebate Rule, ACA Lawsuit Update, and Doings on the Hill


Rebate Rule is Dead

The White House announced this morning that the Administration is pulling the rebate rule. Consequently, the rule that would eliminate rebates will not be finalized. You can read the official confirmation of the rebate rule being withdrawn here in Politico.

 Axios reported that this will put pressure on the Administration to finalize its policy proposal of setting Medicare prices for certain drugs based on what other countries pay. However that policy proposal is facing increasing opposition from lawmakers and industry groups. The Administration already was dealt a setback when a judge struck down its rule that would require pharmaceutical companies to include their prices in television advertising. 

HHS Making Big Changes to Kidney Policy

President Trump issued an important executive order to address kidney disease on Wednesday,

July 10th. The order will ease the shortage of kidneys for transplants by making it easier for living donors to make donations and more likely deceased donor’s organs to get to patients. The executive order also announced the creation of several new CMMI payment models designed to increase use of home dialysis and transplants. One of the models will apply to about half of Medicare patients with end-stage renal disease. 

Medicaid Access Rule

An under-cover story, it appears that CMS is moving ahead with its Medicaid Access proposal. In the proposal, states could cut Medicaid rates without oversight or concern over access. In the rule, CMS would allow states to cut rates up to 4% in one year or 6% over two consecutive years without needing to analyze impact on access. Georgetown University Health Policy Institute released its analysis on the proposed changes to Medicaid access. And here’s a good article from Modern Healthcare discussing the potential financial impact to hospitals

ACA Hearing Goes Badly

On July 8th, three judges from the 5th Circuit Court of Appeals held a hearing on the constitutionality of the ACA. As was widely reported, the hearing went poorly for the ACA as two of the three judges directed pointed questions to the defense. Short-hand legal observers are increasingly concerned that the 5th Circuit would rule against the ACA. You can read more here but the key takeaways are:

  • A ruling is expected this Fall from the 5th Circuit
  • The 5th Circuit could uphold the ACA, strike down the mandate, strike down the ACA for a portion of the country, or strike down the ACA for the entire country
  • However the 5th Circuit rules, expect an appeal to the Supreme Court with a final ruling likely in June 2020

Hill Activity

There is increasing discussion in the Senate about some sort of bill that would control drug prices, especially in regards to Part D plans. For example, one policy being considered is that drug companies would pay money back to Medicare if their prices increase faster than inflation.


Previous editions: 

06/28/2019: Major Legal Developments for ACA, Executive Orders, and Balanced Billing Bill 

06/21/2019: Transparency Executive Order Coming 

06/14/2019: Regulation Watch

06/07/2019: Block Grant Regulation Coming?

05/30/2019:  New and Notes of Note

05/23/2019:  Potential Healthcare Legislation Unveiled 

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