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This Week in Health Care Reform: August 2nd, 2019

A new rule is proposed requiring hospitals to disclose negotiated prices; Senate lawmakers advance drug pricing transparency legislation; stakeholders support Congressional efforts to address SDoH; and, governors weigh their health care options.

Week in Review

Hospital Price Proposal: On Monday, the Administration proposed a sweeping new rule mandating “consumer-friendly” price transparency that would require hospitals to publish the prices they negotiate with insurers or risk being fined.  The rule would apply to the approximately 6,000 hospitals that accept Medicare.  Earlier this year, hospitals were required to start publishing their list prices – which isn’t the same as what a consumer with insurance would pay.  Under the proposed rule, hospitals would now have to make public their standard charges for both gross charges and payer-specific negotiated charges for all services and items.  Stakeholders were quick to respond to the proposal, arguing that disclosing privately negotiated rates between payers and providers would only serve to make it harder to bargain for lower rates, thereby creating a floor – rather than a ceiling – for the prices that hospitals would be willing to accept in negotiations, the end result being higher prices – and, therefore, premiums – for consumers and taxpayers.

Rx Transparency Bill: As anticipated, top lawmakers from the Senate Finance Committee released their proposal to lower prescription drug prices early last week.  That bipartisan bill from Sens. Chuck Grassley (R-Iowa) and Ron Wyden (D-Oregon) could save government health programs as much as $100 billion in costs by forcing pharmaceutical manufacturers to pay rebates to Medicare if they raise prices more than the rate of inflation.  Additionally, the proposal would cap seniors’ out-of-pocket spending in the Medicare Part D program, shifting costs for the catastrophic phase away from the government and towards health plans and drugmakers.  The bill passed out of committee last Thursday by a 19-9 margin.  The Finance Committee bill comes on the heels of a separate drug pricing transparency bill that was passed out of the Senate Health, Education, Labor, & Pensions (HELP) Committee last month.

Congress & SDoH: Late last week, a bipartisan group of House lawmakers introduced a bill directing government agencies to team up to address social determinants of health (SDoH).  Led by Reps. Cheri Bustos (D-Illinois) and Tom Cole (R-Oklahoma), the Social Determinants Accelerator Act would launch a multi-agency council and fund $25 million in grants to help manage needs like food, housing, and transportation for certain Medicaid populations.  It would also give state and local health officials access to the additional resources they need to overcome traditional data collection restraints and develop innovative approaches to the complex issues plaguing vulnerable communities.  Health plans and health systems – who have already been working to better address SDoH – were quick to support the proposed bill, pointing to its ability to help “catalyze the cross-sector collaboration and planning necessary to make the promise of a whole-person approach a reality.” 

States' Waiting Game:
Governors from across the country gathered in Salt Lake City last week for the annual summer meeting of the National Governors Association.  While there, a handful of attendees addressed the latest, pending legal challenge to the Affordable Care Act’s (ACA) constitutionality.  That suit, brought by 18 state attorneys general, was heard last month by the Fifth Circuit Court of Appeals.  Legal experts expect the final decision to ultimately be handed down by the Supreme Court, which has twice upheld the ACA.  In the meantime, the governors highlighted the protections they’ve put in place to prevent people from losing health coverage, including enacting guarantees to access for patients with pre-existing conditions, the implementation of various individual mandate-like requirements, and financing for Medicaid expansion.      

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With Congress back in their states and districts through Labor Day, now’s the time for these lawmakers to hear from their constituents about the issues that matter most to them, such as surprise medical billing.  We’ve been asking our Health Action Network members to reach out to their federal elected officials to urge them to support surprise medical billing legislation that protects consumers by opposing the inclusion of an arbitration-style model into the proposals currently being considered.  Hundreds of you have already responded, sending letters to your members of Congress.  For those that haven’t, there’s still time for you to raise your voice and to tell lawmakers to protect consumers from surprise medical bills and rising health care costs.

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