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The 2016 Election and the Impact on Healthcare
President-Elect Trump, a new Republican Majority and expectations on how the 115th Congress will reshape health policy

The outcome of the 2016 elections presents an opportunity for President-Elect Trump and a Republican Congress to break through the gridlock and advance legislative initiatives, especially in health care. While we can expect a period of transition to identify priorities, agendas and paths forward, we anticipate a very active 115th Congress as the Republicans work to pass legislation before the next election. The upcoming sessions may create an opportunity for the White House and Capitol Hill to take a fresh look at legislative prospects, reassess strategies, and broaden approaches to think outside the box. In particular, over the next two years we can expect to see major shifts in health policy, including numerous provisions in the Affordable Care Act being repealed or altered through regulatory actions, changes to MACRA and the elimination of red tape to allow for greater medical innovation.

Affordable Care Act (ACA)

Mr. Trump did not take a position on most health care issues during the campaign. Yet he was very clear in his commitment to repeal and replace Obamacare, citing higher premiums, less competition and fewer choices. As a candidate, Mr. Trump called for Congress to repeal Obamacare and:

  • eliminate the individual mandate
  • allow the sale of health insurance across state lines
  • permit individuals to fully deduct health insurance premium payments
  • allow individuals to use Health Savings Accounts (HSAs)
  • require price transparency from all healthcare providers
  • create block-grants to replace Medicaid expansion funding, and
  • remove barriers to entry into free markets for drug providers that offer safe, reliable and cheaper products

We can also expect changes to Medicaid benefits and eligibility, the elimination of the Cadillac tax and the end of the employer mandate.

It’s unlikely that the Affordable Care Act will be completely repealed. Democrats hold enough seats in the Senate to mount a filibuster, and the only detailed replacement proposals offered by Republicans would increase the number of uninsured Americans by at least 20 million and the federal budget deficit by tens of billions of dollars. Yet Republicans in the Senate can circumvent Democratic opposition by incorporating the repeal measures in the highly complex budget reconciliation process, which only requires 51 votes and cannot be filibustered. The Trump Administration will also have discretion to impact the law through the regulatory process and Executive orders. For instance, the Trump Administration can terminate the existing lawsuit that would end certain subsidies, which could lead to the collapse of the Obamacare insurance exchanges. A Trump Department of Health and Human Services (HHS) could also redirect the implementation of the ACA as the HHS Secretary was granted discretion on a host of key provisions.

Medicare Access and CHIP Reauthorization Act of 2015 (MACRA)

MACRA, which transitions Medicare fee-for-service payment to value-driven and outcomes-based arrangements, was crafted in a bipartisan manner, through regular committee order, and passed with overwhelming support (392-37 in the House; 92-8 in the Senate). This effort is not expected to be repealed. However, there may be opportunities to improve the implementation of the law, which has been executed by the Obama Administration. ASPS has been very vocal in its opposition to MACRA and its concerns with the manner in which the law has been implemented by the U.S. Department of Health and Human Services and the Centers for Medicare and Medicaid Services.

A component of MACRA, rooted in the ACA, is the “meaningful use” of certified electronic health records (EHRs). Requirements for positive payment adjustments is linked to providers’ use of EHRS, and the requirements continue to increase annually. Interoperability would likely help decrease some of these burdens. While there has been a bipartisan push to achieve interoperability of these health information technology (IT) systems, Republicans have raised concerns with the current state of EHR usability and connectivity. The medical community has urged for the development and adoption of standards to enable bidirectional exchange of health information across disparate health IT systems, including clinical data registries (CDRs). Under this new Congress and Trump Administration, efforts to address these long-standing issues could move forward at a more rapid pace.

Independent Payment Advisory Board (IPAB)

IPAB was created under the Affordable Care Act, but a Republican Congress has blocked funding for IPAB and no individuals have been appointed to serve on the Board. The IPAB has been criticized for having 15 expert members who would have broad authority to recommend changes to Medicare payment policy. These members are not elected, providing them with little accountability, and they are not permitted to actively practice medicine or hold any other positions that are directly involved in the delivery of Medicare services. ASPS, as well as others in specialized medicine, has advocated for the repeal of IPAB during its biannual Fly-Ins in Washington, DC.

The ACA provides a process to deactivate the Board, requiring legislation be introduced by February 1, 2017. The House of Representatives voted in 2015 to repeal the IPAB in its entirety. IPAB is expected to receive immediate attention by Congress in 2017 due to the timeline to introduce repeal legislation. Dissolving the Board will also become a top priority as Medicare spending is expected to exceed its target rate, which would trigger the creation of the Board.

The FDA and 21st Century Cures

The Prescription Drug User Fee Act (PDUFA) VI, which provides the Food and Drug Administration (FDA) with the authority to impose user fees to fund agency activities, must be reauthorized by September 30, 2017. Since user fees account for about half of the FDA’s total budget, Congress will work to finalize this legislation by summer 2017 to meet the deadline. This legislation is expected to include the reauthorization of the user fees for medical devices, biosimilars, generic drugs, and others. It will likely also serve as a vehicle for other related initiatives, including provisions in the 21st Century Cures legislation and efforts to address drug pricing or other FDA-related initiatives.

ASPS has been a strong advocate of the 21st Century Cures package, which:

  • impacts the collection of registry data
  • creates a new category for covered durable medical equipment
  • provides Medicare beneficiaries with immediate access to new FDA-approved medical devices not currently covered by Medicare
  • relieves regulatory burdens that can inhibit access to innovative new products
  • repeals the Sunshine Act requirements to report on medical textbooks, peer-reviewed journals, journal reprints and journal supplements

After months of negotiations over the funding of the National Institutes of Health, Congress intended to pass this package during the 2016 lame-duck session. However, there has been a recent swell of opposition for moving the bill before the next Congress so that provisions can be included that address the affordability of pharmaceutical products. Give the Republican majority, congressional leadership may choose to hold this bill until the 115th Congress.