Legislative Update – Post Midterms Edition – 11/18/2018


Nearly two weeks after Nov. 6, the ballots have been counted and the winners and losers are finally in the books. A lame duck session of Congress is in progress with some 2019 spending bills, having been kicked down the road, needing approval to avoid a partial shutdown. Meanwhile the Senate promises to expedite as many of Trump’s nominations as possible in the remaining weeks of the 115th Congress.

Here to unpack the consequences of the midterm’s outcome, is the post-election edition of Legislative Update by Marilyn Singleton, MD, JD:

New Federal Healthcare Legislation Unlikely

Republicans never coalesced to present a viable alternative to the Affordable Care Act. The Democrat-led House is divided regarding its goals. The socialist wing wants Medicare for All based on Bernie Sanders bill, S. 1804.  Nancy Pelosi wants to “improve” the ACA by adding consumer “protections” for pre-existing conditions, that instead of protecting patients, increase costs for them and degrade the quality of their coverage. “It’s about stopping the GOP and [Senate Majority Leader] Mitch McConnell’s assault on Medicare and Medicaid, the Affordable Care Act, and the health care of 130 million Americans living with pre-existing medical conditions.”

The split control of the 116th Congress means any radical health care measure would be blocked while some less controversial measures might sneak through. For instance, a bipartisan bill from last session, S. 974 and H.R. 2212, the Creating and Restoring Equal Access To Equivalent Samples Act of 2017 (CREATES Act), is expected to be reintroduced. The bill would allow generic drugmakers to sue brand-name drugmakers to obtain samples of brand-name treatments to develop generic versions. Pharma promises to not oppose passage, in return for Congress rolling back increased industry responsibility for Part D donut-hole costs.

Medicaid Expansion

One fifth of Americans receive Medicaid as health insurance coverage, including those who rely on Medicaid to cover long term care. However, as of 2016 over 81% of Medicaid enrollment is in managed care programs. Medicaid consumes over 20% of states’ budgets, not including the federal contribution. When including the federal contribution, the program makes up 29.7% of total state expenditures in fiscal 2018, compared to 20.5% a decade earlier.

The elections brought an increase to the number of states expanding Medicaid coverage to Americans earning up to 138% of the federal poverty level as set for in the ACA.

Ballot initiatives to enact expansion in Idaho, Utah and Nebraska were approved while Montana voters rejected a similar initiative.

Governorships changed hands from Republicans who had resisted expansion to Democrats favoring it in Wisconsin and Kansas. Maine’s new Democratic Governor will jumpstart the expansion that was voted upon in 2017 but had been held up by the Republican government due to costs. This will bring the total number of states expanding to 36 states plus the District of Columbia. (North Carolina, South Carolina, Georgia, Florida, Alabama, Mississippi, Tennessee, Kansas, Oklahoma, Texas, Missouri, South Dakota, Wisconsin, and Wyoming have not expanded).

Medical Marijuana

Legalizing marijuana for recreational and medical use has been steadily increasing.

Recreational use: Michigan voted to legalize the recreational use of cannabis; but such a measure failed in North Dakota. Other states where recreational use is legal: District of Columbia, Alaska, California, Colorado, Maine, Massachusetts, Michigan, Nevada, Oregon, Vermont and Washington.

Medical use: Utah and Missouri legalized it for medical use

Other states where medical marijuana is legal: Arizona, New Mexico, Montana, North Dakota, Minnesota, Oklahoma, Arkansas, Louisiana, Illinois, Ohio, West Virginia, Pennsylvania, New York, Connecticut, New Hampshire, Rhode Island, Delaware, New Jersey, Maryland, Florida, Hawaii.

Texas representative Pete Sessions, who had resisted various marijuana legalization attempts, was defeated by Colin Allred who has expressed his approval of medical marijuana.

One caution: when marijuana is legalized in a state, it must be produced in that state because of federal prohibitions against transport across state lines. Already a black market has opened up for the interstate market.

Price Controls

California’s Proposition 8 which sought to cap the revenues of dialysis centers was soundly defeated. After similar legislation failed, the proposal was initiated by healthcare union SEIU-United Healthcare Workers West and backed by insurance companies. (Dialysis workers have resisted unionizing.) Under the proposition, the state’s dialysis clinics would have had to limit revenue to 15% more than their costs of doing business and refund any excess funds to insurance companies to help them pay for dialysis treatments. It also would have prohibited clinics from refusing to treat patients based on payment source.

This proposition was advertised by the proponents as helping patients deal with costs. The opponents, that included private dialysis companies, the National Kidney Foundation, Renal Support Network, and nursing and doctors’ groups, contended that capping costs had the potential to close down smaller community clinics without increasing competition or lowering costs.

Increasing Taxes/Bonds

Despite the alleged popularity of the “tax the rich” philosophy, a proposition to raise taxes on Maine’s wealthiest businesses and citizens to fund home care for the disadvantaged and elderly was soundly defeated. Opponents of both parties argued it would be bad for the state’s economy.

California’s Proposition 4, the measure to authorize $1.5 billion for the Children’s Hospital Bond Act was the third bond measure to prop up California’s pediatric systems in 15 years. Despite opponents warning that the bond unnecessarily bailed out hospitals yet again, the measure passed with 61% of the vote.

Notable Year-end Bills

These bills will likely not be considered before the next congressional session but they are worth watching – one hand gives freedom, the other takes it away.

Sen. Ted Cruz (R-TX) introduced a bill, S. 3560, the Retirement Freedom Act which would allow individuals to choose to opt out of the Medicare Part A benefit. Text: https://www.govtrack.us/congress/bills/115/s3560/text.

Sen. Rand Paul (R-KY) introduced a bill, S. 3610, the Medicare Patient Empowerment Act of 2018, which would establish a Medicare payment option for patients and eligible professionals to freely contract, without penalty, for Medicare fee-for-service items and services, while allowing Medicare beneficiaries to use their Medicare benefits. https://www.govtrack.us/congress/bills/115/s3610/text.

Sen. Maggie Hassan (D-NH) introduced S. 3592, the No More Surprise Medical Bills Act of 2018. The bill would require notice and contracts with patients, enrolled in group coverage, receiving services from out-of-network health care providers. In emergency situations, out-of-network health care providers may not charge patients more than the amount that the patient would have been required to pay in cost sharing if such items or services had been furnished by an in-network health care provider. https://www.govtrack.us/congress/bills/115/s3592/text.

A companion to Sen. Hassan’s S. 3592 is the Reducing Costs for Out-of-Network Services Act of 2018,  S. 3591, introduced by Sen. Jeanne Shaneen. This bill would impose price controls on out-of-network medical care provided to enrollees in the individual market and to the uninsured. It would also “authorized to be appropriated such sums as may be necessary” to study the impact of imposing similar price controls on the group market. https://www.congress.gov/bill/115th-congress/senate-bill/3541/text

Further analysis of the Hassan and Shaheen bills can be found here: https://www.healthaffairs.org/do/10.1377/hblog20181017.792315/full/