HRI regulatory center

Regulatory and legislative updates and analysis


President Donald Trump: The latest healthcare developments

Healthcare, hurricanes and disaster response

Months and even years after the winds subside and the floodwaters recede, hospitals and health systems in regions battered by a hurricane will still be dealing with the financial, physical and reputational wreckage caused the storm. Hospitals face closure, chaotic revenue cycle operations, disrupted supply chains, possible credit downgrades, destroyed and damaged physical assets and displaced workforces and patients. Partner institutions, such as long-term care facilities and retail pharmacies, may temporarily, or permanently, operate at diminished capacities. To survive such an event, hospitals and health systems should plan for the complex challenges left in the wake of a hurricane or other natural disaster.

Read HRI 's report, Hospitals and health systems feel the impact of hurricanes long after the floodwaters recede

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Health reform 3.0: Thriving in a permanent state of policy disruption

The death of health reform has been greatly exaggerated. Though Congress was unable to pass a comprehensive national health reform bill in 2017, many other reforms are playing out in Congress, regulatory agencies and state capitals that could profoundly impact the healthcare landscape over the next year and beyond. 

These changes include efforts by Congress to reform the federal tax code; by HHS to reshape how the Affordable Care Act (ACA) is administered and how government pays for value over volume; and by states to control Medicaid and drug spending. These efforts make it clear that this is no time for companies to take a relaxed or reactive posture. On the contrary, they should act now to anticipate which changes are most likely to occur and how those changes might affect their business operations, then decide what they’re going to do about it. 

Payers, providers, life sciences companies and employers no longer have just one high-profile reform effort to monitor, but dozens. There are several that require their immediate attention. 

Read HRI and Strategy&'s report, Health reform 3.0: Thriving in a permanent state of policy disruption

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Weekly insights from Capitol Hill

Highlights – December 4, 2017

Novel pathway would speed approvals for military medical use

The FDA may soon receive new authority to approve medical products specifically for emergency military purposes under legislation awaiting President Donald Trump’s signature. The bill, H.R. 4374, allows the FDA to authorize the emergency use of drugs and medical devices intended to address a “military emergency … involving a heightened risk to US military forces,” such as biological, radiological or other life-threatening risks. The agency would act in conjunction with the Department of Defense, whose secretary would determine and declare if such a scenario exists, prompting the FDA to expedite requests for review. The FDA also could permit “expanded access” to the product, allowing its use in small groups of especially needy individuals even before any authorization. The product would be allowed for use only in limited circumstances and would not receive full, traditional approval without further review. The FDA could revoke marketing authorization.

HRI impact analysis: The new military use provisions may be especially helpful to companies developing treatments for blood loss, trauma, emergency medicine or exotic diseases in conflict zones. Emergency use authorizations are rarely granted but remain especially useful in certain situations to quickly get products that have passed basic regulatory review—indicating they are safe to use—to market. Emergency use authorizations have previously been granted during outbreaks of Ebola, Zika, swine flu and other diseases. Without expedited review and reduced marketing standards, the typical regulatory review process would otherwise be too slow to respond in time during a crisis.

CMS cancels value-based care models, promises new ones

CMS issued a rule officially canceling two Obama-era bundled payment programs—the Episode Payment and Cardiac Rehabilitation programs—and halved the number of geographic areas required to participate in the Comprehensive Care for Joint Replacement (CJR) model. CMS also exempted low-volume and rural providers from the joint replacement bundled payment program. Acknowledging that providers had invested in preparing for these canceled models, CMS said it will develop new, voluntary bundled payment models to give providers more chances to earn bonus payments in 2018 under the 2015 physician payment reform bill MACRA. The rule also will allow more clinicians to earn bonus payments through the CJR model by broadening what it considers as supporting the model. The rule is effective Jan. 1; providers not in one of the 34 mandatory regions interested in participating in the CJR model in 2018 must opt in by Jan. 31.

HRI impact analysis: The announcement that CMS will install new bundled care models next year, in addition to its decision last month to expand a Medicare Advantage value-based model, indicates the administration is serious about value-based care but not interested in compelling providers to participate. In response to providers’ comments, the rule noted that “easing regulatory burden on health systems and continuing the transition into value-based care are not mutually exclusive goals.” In doing so, the administration has continued to leverage the authority of the controversial Center for Medicare and Medicaid Innovation created by the ACA, which will allow them to test future models without congressional approval.

Highlights – November 27, 2017

Senate closer to zeroing out ACA mandate penalty

The Senate Budget Committee passed the Senate tax bill along party lines on Tuesday, edging closer to rendering a key part of the Affordable Care Act (ACA) moot. The bill would zero out the ACA’s individual mandate penalty after Dec. 31, 2018, a move that would lead to 13 million fewer insured Americans after 10 years compared with current law, according to a Congressional Budget Office (CBO) analysis. Many of those uninsured would be consumers who don’t want to buy insurance, while others would be people eligible for Medicaid who fail to sign up without a legal prod to spur them. Still others would be consumers who want coverage but can’t afford it because of premium increases that would occur in the nongroup market, which the CBO estimates could be about 10 percent a year. The full Senate could vote on the bill as soon as Friday or early next week.

HRI impact analysis: The ACA’s individual mandate has long been controversial. Critics say it’s an unwelcome government intrusion into people’s lives, forcing them to purchase a product they may not want. Proponents say it’s necessary to keep premiums down by compelling healthy people, who might otherwise choose to forgo insurance, to buy coverage. The failed effort to repeal and replace the ACA in one piece of sweeping legislation has been replaced by a fragmented approach in which state and federal lawmakers, agencies and policymakers seek to achieve the same goals, including taking the teeth out of the 2010 law’s individual mandate.

ACA sign-ups solid so far

Recent national and state figures for enrollment on the federal ACA Healthcare.gov insurance exchange show that roughly 2.8 million people have signed up four weeks into enrollment. That’s about 700,000—or 30 percent—more than last year at this time, according to statistics released by CMS. The statistics do not include auto-renewals yet. Still, so far, this rate falls short of doubling last year’s rate, which would be needed to offset the fact that this enrollment period is about half as long as last year’s. Without a substantial surge by the time enrollment ends Dec. 15, enrollment could wind up lower than last year’s total of 9.2 million. 

HRI impact analysis: Despite year-over-year increases and efforts by states, such as California, which launched a significant marketing campaign, final enrollment may still be lower than last year’s. Enrollment peaked during weeks 7 through 9 last year, which would be the equivalent of weeks 3 through 5 this year. Given the current uncertainty and trends, caution is advised in making projections, as the jury is still out on where ACA enrollment will end up.

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Payers: Trump administration briefs

As the debate over repealing and replacing the Affordable Care Act (ACA) moves to the US Senate, generating considerable uncertainty about the law’s future, health insurers face looming deadlines to participate in the ACA exchanges this fall. Several insurers already have announced they will drop or reduce participation, raising questions about the ACA nongroup market’s health as open enrollment begins Nov. 1.

Read HRI’s spotlight, Trump policy agenda – Exchange participation

 

After President Donald Trump and Republican leaders canceled a vote on the American Health Care Act (AHCA), the world became more complicated for health industry leaders and their consumers. Amid the multiple unknowns, health leaders may be tempted to wait for clarity. But in this atmosphere, it is even more important for organizations to lean into the unknowns and build resiliency. Healthcare companies can make some “no regrets” moves to build resilience amid periods of change and uncertainty.

Read HRI’s spotlight, What’s next for health reform?

 

As they mull the ACA’s fate, Republican lawmakers are weighing four options to replace the individual mandate. Any replacement to the mandate would need to accomplish two goals: encourage sign-ups by healthy enrollees, and discourage voluntary coverage gaps.

Read HRI’s spotlight, Replacing the individual mandate

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Providers: Trump administration briefs

The Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) is transforming the way physicians are paid for Medicare services. But the law also could have profound effects on hospitals and health systems, potentially hitting their bottom lines, changing the way they evaluate consolidation and how they design provider networks. For hospitals and health systems, MACRA is a strategic puzzle to solve, requiring greater enterprise resilience in these times of change and uncertainty.

Read HRI’s spotlight, MACRA is a strategic puzzle that requires greater resilience (September 2017)


The American Health Care Act (AHCA) aims to partially repeal and replace the ACA, by phasing out the ACA’s Medicaid expansion and capping federal funding for the program, among other things. Under the AHCA’s Medicaid plans, healthcare providers could experience a gradual increase in uncompensated care, cuts in Medicaid reimbursement rates, or both.

Read HRI’s spotlight, Implications of phasing out Medicaid expansion (March 2017)


Republican lawmakers are promoting Medicaid block grants as a way to control federal healthcare spending. Providers can expect a shift from an entitlement to a free market Medicaid approach, along with a possible rise in the uninsured population or decrease in reimbursement.

Read HRI’s spotlight, Medicaid block grants and per capita funding (February 2017)

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Pharma and life sciences companies: Trump administration briefs

The pharmaceutical industry is facing a growing threat from safety data on the drugs it produces. The FDA has fostered unprecedented transparency on drug safety data, forcing companies to manage novel challenges from parties already busy mining those data: regulators, the public and data analytics firms. In this climate, pharmaceutical companies have the opportunity to find ways to mitigate risks, unlock savings, make new discoveries and create competitive advantages.

Read HRI’s spotlight: Pharmaceutical companies face the changing future of pharmacovigilance (September 2017)


The FDA’s new commissioner, Dr. Scott Gottlieb, has extensively argued that the agency is in need of regulatory reform meant to get critical medical products to patients more quickly and efficiently. Gottlieb’s previous statements signal a greater likelihood of significant change at the FDA, which has been given new authority – both statutory and executive – by legislators and President Donald Trump to streamline and accelerate the way it regulates. As change takes place, life science companies may benefit and find reasons to celebrate – but so, too, will their competitors. 

Read HRI's spotlight, The FDA leans forward: Dr. Scott Gottlieb’s opportunity to reshape the agency


As the US tax and trade reform debate continues, pharmaceutical and life sciences companies should waste no time in evaluating how different provisions would affect their business operations. Companies should model possible changes could affect manufacturing and supply chains, locations of intellectual property (IP) holdings, unremitted earnings held overseas and planned capital expenditures. Updated August 2017.

Read HRI’s spotlight, Creating a pharmaceutical supply chain and business strategy amid tax and trade reform uncertainties (Updated August 2017)


After President Donald Trump and Republican leaders canceled a vote on the American Health Care Act (AHCA), the world became more complicated for health industry leaders and their consumers. Amid the multiple unknowns, health leaders may be tempted to wait for clarity. But in this atmosphere, it is even more important for organizations to lean into the unknowns and build resiliency. Healthcare companies can make some “no regrets” moves to build resilience amid periods of change and uncertainty.

Read HRI’s spotlight, What’s next for health reform?

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Health industry strategy: Trump administration briefs

Healthcare reform efforts by Congress will create challenges and opportunities that may require changes in operating models across the US healthcare industry. As the legislation undergoes debate and negotiation in Congress, healthcare organizations face considerable uncertainty. Organizations that have developed enterprise resilience—the ability to adapt the business model to change, anticipate disruption and recognize opportunities to generate a competitive advantage—may be best positioned to survive and thrive in these conditions.

Read HRI’s spotlight, Developing enterprise resilience in the face of health reform

 

The inaugural festivities are over, the revelers have gone home, and President Donald Trump has moved into the White House. With so much change in the air, what actions can health organizations take today?

Read HRI's spotlight, (Some) change is coming to healthcare

 

As the American Health Care Act (AHCA) bill makes its way through the legislative process, the nation’s healthcare industry is left to contend with considerable uncertainty. However, there are concrete steps healthcare stakeholders can take in the whirl of uncertainty to help build resilience no matter what specific policy provisions are enacted.

Read Strategy&’s article, Why Healthcare Companies Need to Focus on Enterprise Resilience

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About the center

As the US healthcare system continues to undergo transformation, health industries are confronted with an evolving and complicated regulatory environment. With an eye towards how public policy impacts the business of healthcare, the HRI regulatory center serves as a vital resource for executive decision makers who must navigate the changes that lie ahead.

HRI's regulatory center is a group of seasoned professionals that analyze legislative and regulatory policy in Washington and in key states. The group, which focuses on all health sectors, publishes a weekly newsletter and more focused reports that detail the interconnection between Washington and healthcare. The HRI regulatory center calls upon key contacts in government and industry to develop a point of view that is both informative and actionable for health industry leaders.
 

Contact us

Benjamin Isgur
Health Research Institute leader
Tel: +1 (214) 754 5091
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Trine K. Tsouderos
HRI Regulatory Center Leader
Tel: +1 (312) 241 3824
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Alexander Gaffney
Senior Manager, PwC Health Research Institute
Tel: +1 (202) 414 4309
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