Lawmakers recently announced that they have reached a bipartisan bicameral agreement to fund the federal government through the rest of the current fiscal year. Due to disagreements over languagethis deal notably doesn’t address surprise billing measures which were originally supposed to be included. Funding for Medicare and Medicaid extenders, such as community health centers, was appropriated but only through May 22, 2020. As such, this creates an opportunity for an agreement on surprise billing and drug pricing to be reached by late spring.
The funding deal is broken into two legislative vehicles: HR 1865 which is mostly domestic appropriations and HR 1158 which is related to national security. Combined, the two minibuses (policy speak for a smaller omnibus which is one package compiled of several measures that are put together to ease passage), includes 12 appropriations bills.
HR 1865 includes funding for the Department of Health and Human Services (HHS) and other health-related provisions including the CREATES Act. The CREATES Act is a bipartisan bill that has been introduced in multiple sessions and seeks to make it easier for generic and biosimilar developers to obtain confidential information from branded drug manufacturers. While long championed by both parties, CREATES has faced some resistance from brand-name pharma, which is why it has not passed both chambers as a stand-alone bill. Its inclusion in this spending agreement is largely driven by its favorable Congressional Budget Office estimate. Lawmakers are relying on the projected $3.7 billion reduction in federal spending as a critical offset.
In addition, the spending deal also repeals three major health care taxes, including the “Cadillac” tax which has been delayed on multiple occasions. The Cadillac tax is an excise tax on expensive employer-sponsored plans that was originally put on the books as a provision under the ACA. It levies a 40% tax on benefits above a certain limit and was meant to slow the growth in health care expenditures. However, pretty much everyone aside from economists have long loathed the Cadillac tax. When I asked Aaron Turner-Phifer, VP of Government Relations and Policy at URAC, his thoughts, he said it was “disappointing that members of Congress, some of whom are ardent supporters of the ACA, would remove one of the most important financial structures required for the ACA to work effectively.” Nonetheless, Congress has long considered the idea of repealing it, so it’s not surprising that it’s finally on its way to being obliterated for good.
Despite not including more monumental provisions like surprise billing, the fact that lawmakers were able to reach an agreement at all considering the ongoing impeachment inquiry is a good thing. And, the White House has already indicated that the President will promptly sign this agreement into law so we should avoid repeating last year’s government shutdown.