Health Care Watch: March 3, 2025
The following Federal Health Policy (FHP) Strategies Weekly Health Care Watch provides a summary of legislative and regulatory health care activities from February 23 – March 1. Where available, hyperlinks are included to the relevant documents. Please let us know if you have any questions or would like additional information on the items below.
LEGISLATIVE UPDATE
House
On February 25, the Energy & Commerce Committee held a full committee markup to adopt it's oversight plans for the 119th Congress. In terms of health policy, the committee expects to:
Conduct oversight of the Federal government’s policies and procedures relating to pandemic prediction, prevention, preparedness, and response; National Institutes of Health (NIH) and the Centers for Disease Control and Prevention (CDC); Drug Enforcement Administration (DEA) and the Office of National Drug Control Policy (ONDCP); and role of social media in facilitating fentanyl distribution throughout the U.S.;
Review of the IMD exclusion and its impacts on access to mental health care;
Conduct oversight over the Substance Use Disorder Prevention that Promotes Opioid Recovery and Treatment for Patients and Communities Act and reauthorize those expiring authorities with any changes necessary if such policies should be reauthorized;
Examine issues related to the affordability of health care, including areas where federal government intervention has contributed to increased costs;
Work with the Department of Health & Human Services (HHS) to identify regulations contributing to market dynamics—such as consolidation—that are increasing health care costs;
Examine the factors contributing to the rising prevalence of chronic disease and efforts to treat and prevent chronic disease;
Analyze the Medicare and Medicaid programs to ensure taxpayer dollars are spent wisely;
Examine and review Medicare and Medicaid management and activity to prevent bias, waste, fraud, and abuse;
Ensure the Inflation Reduction Act’s drug pricing program is operating transparently; identify ways to protect and promote seniors’ access to innovative new cures and treatments; and inform the public of the consequences recent changes have had on medical innovation, Part D plan design and patient choice, and access to lower cost generic and biosimilar alternatives;
Monitor Centers for Medicare and Medicaid Services (CMS) process and decisions with respect to Medicare coverage policy and take action, if necessary, to ensure access;
Examine the Food & Drug Administration (FDA) to ensure that regulated drugs and medical devices are safe, effective, and available in an expeditious fashion;
Examine supply chain resilience and opportunities to incentivize and promote domestic manufacturing; and
Analyze the Over-The-Counter Monograph Drug User Fee program (OMUFA), which expires at the end of FY 2025.
On February 26, the House voted 217-213 to approve the chamber’s proposed budget resolution, with Rep. Thomas Massie (R-KY) being the only Republican to vote against the package. Following passage of the House resolution, Speaker Mike Johnson (R-LA) stated that major cuts to the Medicaid program, including per-capita caps and changes to the Federal Medical Assistance Percentage, will not be considered in a subsequent budget reconciliation bill. The House and Senate must now reconcile the differences between the proposed budgets. Bicameral GOP leadership reportedly began working on a compromise shortly after the passage of the House resolution.
On February 26, the Energy & Commerce Committee held a hearing entitled An Examination of How Reining in PBMs Will Drive Competition and Lower Costs for Patients. E&C Subcommittee on Health Chairman Buddy Carter’s (R-GA) opening statement can be found here.
On February 27, Congressional Democrats representing New Mexico sent a letter to HHS Secretary Robert F. Kennedy Jr. (RFK Jr.) demanding immediate action to contain the recent outbreak of measles in the state. The letter asked Secretary Kennedy to maintain weekly disease tracking data updates, rehire federal health workers, and launch a vaccination promotion campaign against measles.
Senate
On February 24, Judiciary Committee Chairman Chuck Grassley (R-IA) sent a letter to UnitedHealth Group Chief Executive Officer Andrew Witty demanding detailed information on the company’s Medicare billing practices. The letter cites reports of alleged fraud, waste and abuse resulting in $8.7 billion in extra payments in 2021 to UnitedHealth Group.
On February 26, Finance Committee Ranking Member Ron Wyden (D-OR) and Health, Education, Labor and Pensions (HELP) Committee Ranking Member Bernie Sanders (I-VT) sent a letter to the Trump Administration expressing concern that the large-scale federal workforce layoffs threaten the progress of bipartisan effort to modernize the organ transplant system. The letter asks HHS Secretary RFK Jr. to share which staff at the Health Resources & Services Administration (HRSA) responsible for implementing improvements to the U.S. Organ Procurement and Transplantation Network (OPTN) have been impacted by the mass terminations.
On February 27, the Judiciary Committee voted 16-5 to advance the Halt All Lethal Trafficking of (HALT) Fentanyl Act. The legislation amends the Controlled Substances Act to permanently classify fentanyl-related substances as Schedule I.
REGULATORY UPDATE
On February 24, CMS announced public engagement events related to the Medicare Drug Price Negotiation Program. The events will be held from April 16 to 30 and will allow patients, clinicians, caregivers, and consumer and patient organizations to share input for the second cycle of Medicare drug price negotiations.
On February 24, FDA granted approval to Medtronic’s BrainSense™ Adaptive deep brain stimulation (aDBS) and BrainSense™ Electrode Identifier (EI) for treatment in patients with Parkinson’s disease.
On February 26, FDA canceled the March 13 meeting of the Vaccines and Related Biological Products Advisory Committee (VRBPAC). The VRBPAC routinely meets in March to recommend flu strains for inclusion in the seasonal vaccines, which are updated annually based on how the flu virus is spreading globally.
On February 27, CMS announced that it is accepting nominations for the Quality Rating System (QRS) and Quality Improvement Strategy (QIS) Technical Expert Panel (TEP) for 2025. Nominations will be accepted through March 10, 2025, and can be made here.
On February 27, San Francisco-based District Judge William Alsup ruled that the Office of Personnel Management (OPM) broke the law when it ordered other federal agencies to terminate probationary employees. Judge Alsup did not order the agencies to reinstate the terminated employees, stating that he does not currently have the authority to do so. However, Judge Alsup did order OPM to rescind any directives it has issued requiring the mass terminations as well as requiring that OPM inform agencies that it has no power to dictate firings across the federal bureaucracy.
On February 28, HHS issued a policy statement rescinding a policy requiring HHS to notify the public and take public comment about a broad array of the Agency’s work including grant making and contracts. Specifically, the new policy targets the Richardson Waiver, which required HHS to take feedback on a variety of actions not otherwise required by Congress in the Administrative Procedure Act. HHS Secretary RFK Jr. wrote in the notice announcing the change that the Richardson Waiver imposes costs on the Agency and the public that are "contrary to the efficient operation of the Department, and impede the Department’s flexibility to adapt quickly to legal and policy mandates.”
On February 28, John Coster, a senior technical adviser for CMS’ Medicare Drug Rebate and Negotiation Group, retired.
WHITE HOUSE
On February 25, President Trump issued an Executive Order (EO) that aims to increase transparency into health care pricing. The EO directs the Departments of the Treasury, Labor, and HHS to rapidly implement and enforce the Trump healthcare price transparency regulations introduced in President Trump’s first term in EO 13877. The EO orders the departments to take action by May 26, 2205, to ensure that hospitals and insurers disclose prices and take action to make prices comparable across hospitals and insurers. Departments will also update their enforcement policies. A fact sheet detailing the EO can be found here.
On February 25, following the issuance of President Trump’s EO on Artificial Intelligence (AI) which directs the development of an AI Action Plan, the Trump Administration opened the Action Plan to public comment. Interested parties can share their policy ideas for the Action Plan by responding to a Request for Information (RFI) which is available on the Federal Register. Comments are due by March 15, 2025.
On February 26, the Office of Management and Budget (OMB) and OPM issued a memo ordering federal agencies to submit plans for the layoff of employees in large-scale reductions in force. The memo states that “pursuant to the President’s direction, agencies should focus on the maximum elimination of functions that are not statutorily mandated while driving the highest-quality, most efficient delivery of their statutorily required functions.” The memo directs agencies to submit reorganization plans by March 13, 2025.
A list of all administrative and health care-related EOs can be found here. FHP Strategies will update this document, as needed.
RULES AT THE WHITE HOUSE OFFICE OF MANAGEMENT & BUDGET (OMB)
Pending Review
CMS
Patient Protection and Affordable Care Act; Individual Health Insurance Market and Exchange Program Integrity (CMS-9884); Proposed Rule; 2/11/25
Hospital Inpatient Prospective Payment Systems for Acute Care Hospitals; the Long-Term Care Hospital Prospective Payment System; and FY 2026 Rates (CMS-1833); Proposed Rule; 2/14/25
FY 2026 Hospice Wage Index, Payment Rate Update, and Quality Reporting Requirements (CMS-1835); Proposed Rule; 2/20/25
HEARINGS
House
Ways & Means Committee
Hearing on Post Acute Care
March
Appropriations Committee
March 5; 10:30 AM; 2358-C Rayburn
Labor, Health and Human Services, Education – Member Day
Senate
HELP Committee
March 5; 10:00 AM; 562 Dirksen
Nomination of Jayanta Bhattacharya to serve as Director of the National Institutes of Health
Witness: Dr. Jayanta Bhattacharya
March 6; 10:00 AM; 562 Dirksen
Nomination of Martin Makary to serve as Commissioner of Food and Drug Administration
Witness: Dr. Martin Makary
REPORTS
Office of Inspector General (OIG)
On February 24, OIG released a report examining Medicare Part D spending for 10 selected diabetes drugs. OIG found that Medicare Part D spending on these drugs increased by 364%, from $7.7 billion in 2019 to $35.8 billion in 2023. Additionally, OIG found that during the same time, there was an increase in prescriptions and prescribers who work in a broad range of specialties. OIG estimates that Medicare spending for the 10 selected diabetes drugs could reach $102 billion by 2026.
On February 26, OIG released a report examining Medicare Administrative Contractors (MACs) use of utilization data when making Part B coverage determinations for Stelara. OIG found that MACs face challenges with utilization data when following CMS’ coverage guidance for drugs such as Stelara. OIG stated that because of data limitations, MACs did not include certain Medicare Advantage (MA) enrollees—and double-counted other enrollees—when determining whether Stelara is usually self-administered. OIG noted that missing data led MACs to overestimate self-administered Stelara use by up to 16 percentage points. OIG recommends that CMS should: 1) assist MACs in obtaining more complete and timely utilization data; and 2) provide guidance on how MACs should account for enrollees who receive injections in both home and professional settings.
ADDITIONAL POLICY NEWS
On February 21, Judge Matthew T. Schlep in the Eastern District of Missouri sided with the Federal Trade Commission (FTC) in a case against the nation’s three largest pharmacy benefit managers (PBMs) stating that PBMs could be violating federal antitrust and price-fixing laws. Judge Schlep declined to halt the lawsuit and denied the PBM’s preliminary relief.
On February 24, the Outsourcing Facilities Association (OFA) filed a lawsuit against FDA regarding the Agency’s recent decision to remove semaglutide from its shortage list. OFA argues that FDA ignored evidence that patients still have difficulty accessing semaglutide, highlighting recent financial disclosures from manufacturers admitting that supply constraints will continue.
On February 25, GenBioPro, the sole manufacturer of the generic version of the drug mifepristone petitioned a Texas federal court, asking the court to intervene in the ongoing legal battle over whether and how patients can access the abortion medication.
On February 26, Baltimore Federal Judge Brendan Abell Hurson extended an order blocking President Trump’s EO that would cut off funds to hospitals who provide gender-affirming care to patients under the age of 19. The hold was set to expire on February 27 but has been extended through March 5. Judge Hurson had initially blocked enforcement of the ban on February 13.
On March 6 and 7, the Medicare Payment Advisory Commission (MedPAC) will hold its March public meetings. The meetings will discuss topics including the physician fee schedule, outpatient services at critical access hospitals, Medicare insurance agents, medigap, ground ambulance services, home health use care use among MA enrollees, and special needs plans. All topics and times can be found here.