Daily on Healthcare: Who will succeed Tom Price?

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Who will succeed Tom Price? Speculation is running rampant over who President Trump is going to tap to succeed Tom Price, who resigned Friday after a scandal over his use of private jets, at Health and Human Services. The New York Times, for instance, has floated four names: Food and Drug Administration Commissioner Scott Gottlieb, Secretary of Veterans Affairs David Shulkin, Centers for Medicare and Medicaid Services Administrator Seema Verma and former Louisiana Gov. Bobby Jindal. Other names floated have included former Pennsylvania Sen. Rick Santorum, who helped craft the Graham-Cassidy healthcare bill that failed last week. Axios is also throwing the hat of Sen. John Barrasso, R-Wyo., into the ring. Meanwhile, Heritage Action’s president, Mike Needham, suggested another name, Wisconsin Republican Sen. Ron Johnson, who was a co-sponsor of Graham-Cassidy. The difficulty the administration faces is that conservatives will want to see a nominee who is sufficiently opposed to Obamacare to give them confidence that he or she would take the administrative steps necessary to provide relief from the law, but Democrats are going to push for somebody who is dedicated to preserving the program. Now that Republicans have failed to pass a plan to repeal and replace Obamacare, administrative actions have taken on an increased purpose, because the law gives the HHS chief a lot of leeway over how it is implemented. Democrats charged that Price had intentionally tried to “sabotage” Obamacare, through such actions as narrowing the open enrollment period and slashing Obamacare’s ad and outreach budget.

Welcome to Philip Klein’s Daily on Healthcare, compiled by Washington Examiner Managing Editor Philip Klein (@philipaklein), Senior Healthcare Writer Kimberly Leonard (@LeonardKL) and Healthcare Reporter Robert King (@rking_19).  Email [email protected] for tips, suggestions, calendar items and anything else. If a friend sent this to you and you’d like to sign up, click here. If signing up doesn’t work, shoot us an email and we’ll add you to our list.

How Trump may try to loosen insurance regulations by executive order. Trump is expected to issue an executive order that would allow people to buy health insurance across state lines, but critics fear the move could further destabilize the Obamacare exchanges and offer inadequate protections for customers. The proposal by Sen. Rand Paul, R-Ky., would allow more people to band together as a group to buy coverage that may be offered in another state. Paul’s proposal is for the Trump administration to make regulatory changes to the Employee Retirement Income Security Act, known as ERISA. Under Paul’s proposal, an individual or a handful of people could join an association health plan and they would be considered one large employer for the purpose of providing coverage. Allowing sales across state lines means that an insurer would sell coverage out of the least-restrictive state. “What you will end up with is all the associations will be organized out of a state which has set its regulations at the lowest possible level,” said G. Lawrence Atkins, executive director of the Long-Term Quality Alliance who formerly worked as a staffer for Republicans. These associations do not have the same regulations as Obamacare, including a guarantee of coverage to people with pre-existing illnesses without charging them more. They also have to provide coverage for a range of medical care, from addiction to maternity services. Critics worry that customers would have inadequate coverage and that pulling healthier people into the associations would further destabilize the exchanges. “For an insurance market to work effectively for the benefit of all consumers, health insurance companies need to operate by the same set of rules,” said Kevin Lucia, project director at Georgetown University’s Health Policy Institute. “At the end of the day, if the administration moves forward with allowing these arrangements to be more loosely regulated and allowed them to bypass critical consumer protections, it sets up an uneven playing field that ultimately destabilizes the individual and small group market and puts consumers at risk.” But to Paul and other conservatives, allowing people to buy these types of plans, which would be less expensive, is a worthwhile goal. “There are experts who have advocated for this change for years, and the fact is it allows more access to a wider variety of plans, with the protections of being in a large group, to millions more Americans,” said Doug Stafford, chief strategist for Paul’s political action committee. “That’s something we should all be for, and indeed it has bipartisan support in Congress.”

Where Republicans and Democrats agree on healthcare. Sen. Bernie Sanders said at a CNN town hall on the future of U.S. healthcare last week that Republicans and Democrats agree on some healthcare issues. “Nobody up here wants to see anybody die,” the Vermont independent said, referring to the other town hall participants, Republican Sens. Lindsey Graham of South Carolina and Bill Cassidy of Louisiana and Democratic Sen. Amy Klobuchar of Minnesota. Despite their disagreements about Obamacare as a whole, the two parties agree on many healthcare issues and have forged bipartisan consensus. Areas of agreement include on prescription drug costs, funding for medical research, treatment for opioid addiction, support for caregivers and repeal of the medical device tax. Read more.

Congress starts CHIP reauthorization. Senate and House committees are holding markups on bills for reauthorizing the Children’s Health Insurance Program. The program expired Saturday at midnight at the end of the 2017 federal fiscal year. However, Congress has been lax to reauthorize it because states won’t start running out of money until December at the earliest. Rep. Michael Burgess, the chairman of the House Energy and Commerce Committee’s health subcommittee, told the Washington Examiner that the goal is to get CHIP reauthorized in early October. The committee is holding a markup on a bill this week. The Senate Finance Committee will hold a markup of its own bill Wednesday. It would reauthorize CHIP for five years and cut some of the boost in funding from Obamacare starting in 2021.

States start to prepare for the worst with CHIP. State officials are worried about the future of the program, despite lawmaker assurances they will reauthorize it. Nevada expects to run out of funds by late November or early December and may have to start warning families on Nov. 1, according to Georgetown University’s Center for Children and Families. “State laws in Arizona and West Virginia, along with Colorado for a portion of its CHIP enrollees, make CHIP coverage contingent on federal funding,” the center said. “West Virginia is in the process of getting a legal interpretation of whether that means October 1, assuming there is no new federal funding for CHIP, or when the state exhausts any carryover funds in early 2018.”

Late response prompts Oklahoma to pull Obamacare waiver request. Oklahoma said it pulled a request to set up a program to reduce Obamacare premiums next year by more than 30 percent because the Trump administration waffled over approving it. The state had sent a request for a waiver to set up its own reinsurance program, but officials said the program won’t be ready in time for the 2018 coverage year. The state’s insurance regulator wrote in a letter to Health and Human Services and the Treasury Department Friday that they should pull its waiver request because of the lack of timely approval. Oklahoma “invested significant resources” in setting up a state-run reinsurance program on its Obamacare exchange, the letter said. On Sept. 22, the state and federal government reached an agreement that the waiver would be approved Sept. 25. However, no waiver approval came that day. “When your departments communicated on Monday that waiver approval would not be provided, with no reason for the delay or timeframe for approval, the Oklahoma reinsurance program was effectively inoperative for the 2018 plan year,” the letter from state HHS secretary and comissioner of health Terry Cline read. HHS did not return a request for comment. Oklahoma said it was open to applying for a waiver again, but only if the government gave it a clear timeline on when approval would come.

McCarthy blames healthcare failure on ‘one or two’ senators who want to ‘hold everything up.’ House Majority Leader Kevin McCarthy lamented Saturday the Senate’s inability to pass a bill overhauling Obamacare, and placed the blame for its failure to do so on “one or two” senators who want to “hold everything up.” “Leadership has done all the battle going in there,” the California Republican told MSNBC. “To me, it seems one or two individuals wants to hold everything up, and that’s the frustration I’ve had with the history of the Senate, where one individual can hold everything up.” Host Hugh Hewitt asked McCarthy if he thought Trump should replace Price at HHS with someone such as former Sen. Jon Kyl, R-Ariz., to “bridge the Susan Collins-Rand Paul gap” at the agency. But the majority leader suggested that the Senate’s inability to pass a healthcare bill lies with the senators serving, not with HHS. “Maybe changing someone in the Senate gets it through the Senate,” he said. “It just seems to become a difficulty over in the Senate not just with healthcare, with so many other items as well.” He said of a new leader at the agency: “I think they, I would bring the Senate together and not just about healthcare, but start looking at what America needs, and I’d bring maybe an expert in and know how to build a team.”

Idaho faces 27 percent increase in Obamacare rates. Idaho’s Obamacare customers will face an average 27 percent premium increase next year because of too many sick customers. The announcement comes as many states are grappling with double-digit rate increases for a variety of reasons that include a sicker-than-expected population and questions about whether the federal government will continue to pay insurer subsidies. Idaho’s silver plans, which are the most popular of Obamacare’s three plan options, will rise an average 40 percent. The premiums for the lowest tier bronze plans will increase 8 percent, and gold plans 9 percent. Idaho pegged the increase to higher medical claims for insurers on the individual market, which showed that claims for 2016 totaled $563 million, but the state’s six insurers brought in only $494 million in premiums.

Democrats demand answers on healthcare.gov outages. Democrats want the Trump administration to answer why it plans to take healthcare.gov offline during Obamacare’s truncated open enrollment this year. Reps. Elijah Cummings, D-Md., and Raja Krishnamoorthi, D-Ill., sent a letter to the Department of Health and Human Services on Friday seeking information on scheduled outages on the website. Residents in 39 states and the District of Columbia use healthcare.gov to buy Obamacare plans. The letter was sent after the Trump administration announced this month it would conduct maintenance outages on the website from midnight to noon on all but one Sunday during open enrollment. Democrats were skeptical of the outages. “The department has had this entire year to conduct routine maintenance without any disruption to people seeking to purchase healthcare plans,” the letter said. Democrats have repeatedly accused the Trump administration of attempting to sabotage the open enrollment period, which was slashed in half for the 2018 coverage year compared to 2017. Open enrollment will run Nov. 1 through Dec. 15, ending six weeks earlier than in 2017. Democrats also have chided HHS for cutting funds for Obamacare ads by 90 percent from $100 million for the 2017 open enrollment to $10 million for 2018.

Judge allows drug ‘price gouging’ law to go into effect in Maryland. A federal judge on Friday refused to block a Maryland law aimed at expensive generic drug pricing from going into effect. The dismissal is a blow to the Association for Accessible Medicines, which represents generics and initiated the lawsuit. U.S. District Judge Marvin Garbis denied the association’s request for an injunction as a lawsuit proceeds, so the law went into effect Sunday as scheduled. The law gives the state attorney general authority to challenge drug companies when they have significantly raised the prices of a generic drug to an “unconscionable” level or one that is “excessive” and “not justified.” Opponents, including generic drugmakers, counter that the law’s language is too vague and likely violates the Constitution. They note that prescription drug prices are not set by states and that the power to regulate interstate commerce belongs to the federal government. Garbis is allowing litigation to proceed on the association’s contention that the law is vague, but dismissed its other arguments, writing that the association did not persuade him the law “is substantially likely to be held unconstitutional.” “Moreover, the court finds that an erroneous grant of a preliminary injunction would cause substantial harm by permitting the sale of essential drugs to Maryland residents at unconscionable prices,” Garbis wrote.

RUNDOWN

The Hill Dems look to turn Obamacare tables on GOP in 2018

Kaiser Health News Heart device failure: Medicare spent $1.5 billion over 10 years to replace faulty implants

Atlanta Journal-Constitution Funding now expired, Georgia healthcare providers see impact

Washington Post Mother who refuses to follow court order to vaccinate son: “Most likely I’ll be going to jail.”

Associated Press Price’s exit adds another hurdle to GOP healthcare push

Bloomberg The hurricane did one good thing for Puerto Rico: It blew away Zika

CNN U.S. scientists awarded Nobel in medicine for body clock insights

Calendar

MONDAY | Oct. 2

Oct. 2-6. National Health IT Week. Details.

Oct. 2-3. Hyatt Regency Capitol Hill, 400 New Jersey Ave. NW. Behavioral Health Hill Days. Details.

3:30 p.m. 950 New Hampshire Ave. NW. Society for Women’s Health Research on “Migraines Matter: Beyond Burden to Value.” Details.

TUESDAY | Oct. 3

8 a.m. District Architecture Center. 421 7th St. NW. The Atlantic forum on prescription drug costs. Details.

8:30 a.m. Mayflower Hotel. 1127 Connecticut Ave NW. Politico event on “Medicaid Innovation: An Integrated Approach.” Details.

10:15 a.m. 2322 Rayburn. House Energy and Commerce hearing on “Examining Patient Access to Investigational Drugs.” Details.

House to vote on 20-week abortion ban, Pain Capable Unborn Child Protection Act.

WEDNESDAY | Oct. 4

8 a.m. Westin New York. S&P Global Ratings’ Health Care Conference. Agenda.

8 a.m. Newseum. 555 Pennsylvania Ave NW. Event with the Hill on “Innovating to improve patient health.” Details.

9:30 a.m. 215 Dirksen. Senate Finance Committee markup on CHIP reauthorization. Details.

10 a.m. 1775 Massachusetts Ave. NW. Brookings Institution event on “What does 21st century medicine look like?” Details.

THURSDAY | Oct. 5

10 a.m. 430 Dirksen. Health, Education, Labor and Pensions Committee hearing on the “Federal Response to the Opioid Crisis.” Details.