SIGN UP! If you’d like to continue receiving Washington Examiner’s Daily on Healthcare newsletter, SUBSCRIBE HERE: http://newsletters.washingtonexaminer.com/newsletter/daily-on-healthcare/

Trump DOJ joins latest Obamacare legal fight. Lawyers for the Department of Justice have asked a court to strike down key Obamacare regulations requiring insurers to offer coverage to those with pre-existing conditions at equal price, arguing that they are now invalid due to the passage of last year’s tax law. While the legal move still faces an uphill climb, it creates another cloud of uncertainty for insurers in the coming months as they finalize rates for the new year. It is also sure to embolden Democrats who plan to make healthcare a central part of their strategy to retake Congress in Novemberl’s elections by arguing that Republicans led by President Trump are sabotaging Obamacare. The latest legal twist for Obamacare arises out of a suit filed by 20 states led by Texas and Wisconsin which argues that because the tax law eliminated penalties for going uninsured, the individual mandate is no longer constitutional. The reasoning is that in 2012 the Supreme Court found the mandate constitutional by defining it as a tax, but absent the penalties, it is no longer a tax and thus cannot be constitutional. Given its centrality to the law, the plaintiffs argue, striking it down means that the rest of Obamacare must also fall. Far from defending Obamacare against the suit, as is typical for the government in challenges to federal law, the Justice Department filed a brief in the U.S. District Court for the Northern District of Texas agreeing with the plaintiffs that the individual mandate was no longer constitutional. Justice also argues that two other Obamacare provisions should be struck down — one requiring insurers to cover those with pre-existing conditions and the other preventing insurers from charging more based on health status. Justice argues that the regulations cannot be severed from the individual mandate, which was put in place to compel younger and healthier individuals to purchase insurance to offset the costs of covering older and sicker individuals with pre-existing conditions. The reasoning has been widely critiqued, including by libertarian law professor Jonathan Adler, who was one of the intellectual architects behind the Supreme Court case challenging the implementation of Obamacare’s subsidies. Adler took particular issue with the DOJ’s argument that the mandate could not be severable, given that by passing the tax law, Congress has done exactly that.  

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.

Editor’s note: We will be off Monday, but the newsletter will resume on Tuesday, June 12.

Despite CHIP concerns, House approves Trump’s bill to slash $15 billion in federal funds. The House late Thursday narrowly passed Trump’s proposal to rescind $15 billion in previously appropriated funding by the government that was never spent. The vote is meant to put conservatives at ease about the huge two-year spending deal lawmakers reached this year, which will increase spending by about $300 billion over that period of time. About half of the unspent money cut would come from the Children’s Health Insurance Program, or CHIP. “After exploding the deficit with a GOP tax scam for the wealthy and well-connected, Republicans have the gall to invoke ‘fiscal responsibility’ in demanding a new rescissions package that attacks funding reserved for children’s health initiatives,” said House Minority Leader Nancy Pelosi, D-Calif. Republicans point to the 10-year reauthorization bill they passed as part of the January government funding deal to reopen the government. “Republicans have made sure CHIP isn’t going anywhere. We have removed any uncertainty about the stability of funding for that program,” House Majority Leader Kevin McCarthy said. “The funds we are rescinding tonight were appropriated long ago and will not be used for their intended purpose now.” The bill will move to the Senate. Majority Leader Mitch McConnell, R-Ky., says he is open to considering the bill, but there are no guarantees it will get through the upper chamber.

Virginia governor signs Medicaid expansion into law. Virginia Gov. Ralph Northam signed a bill into law Thursday that will allow more people to sign up for healthcare coverage paid for by the Medicaid program. Northam, a Democrat, campaigned on the promise of expanding Medicaid in the commonwealth, which is projected to move 400,000 low-income residents onto the program. The provision, created under Obamacare, will allow people who make less than roughly $16,643 a year to enroll in Medicaid, a health insurance program paid for by the state and federal government. Residents will be allowed to start signing up for the program on Jan. 1, 2019.

Maine governor appeals ruling that he must expand Medicaid. Republican Gov. Paul LePage’s administration appealed a judge’s order that requires the state to submit a proposal for Medicaid expansion by June 11. Ricker Hamilton, Maine’s commissioner of the Department of Health and Human Services, said the decision by the court was unconstitutional. He has asked for a delay as the case is argued. LePage is opposed to Medicaid expansion and vetoed proposals five times from the legislature to have it expanded. The provision to expand the program became law after voters passed it through a ballot measure in November.

Senators propose bill letting states regulate marijuana after talks with Trump. Lawmakers introduced legislation Thursday aimed at resolving the long-running tension between states that legalized medical and recreational marijuana use and the federal government, which still deems all use a federal crime. The bill, offered by Sens. Cory Gardner, R-Colo., and Elizabeth Warren, D-Mass., comes after Trump’s April assurance to Gardner that he would support reform. Gardner told reporters that “I have spoken to the president today and certainly that was part of the conversation.” The Strengthening the Tenth Amendment Through Entrusting States Act, or the STATES Act, would change federal law to say that the federal Controlled Substances Act doesn’t apply to state regulated markets. It sets a 21-year age requirement for recreational sales, and removes industrial hemp, or low-THC cannabis, from the CSA, making it legal to grow nationwide. It also would ease banking hurdles to legal pot businesses.

Suicide rates rise across the U.S. More than 45,000 people in the U.S. killed themselves in 2016, with the rate increasing in almost every state, the Centers for Disease Control and Prevention said Thursday. Suicide rates have risen 30 percent in roughly two decades, and it has become the 10th leading cause of death in the U.S. More than half of people who die by suicide did not have a diagnosis for a mental health disorder. Life troubles, such as losing a job, abusing drugs or alcohol, or having physical health problems, contributed to the risk of suicide.

Suicide was highest among white men in middle age. Rates of suicide increased in every state except Nevada, whose rate fell by 1 percent. Rates were highest in Montana. The latest figures put suicide at roughly the same levels of deaths from opioids, which often coincide with suicides and involve drugs such as prescription painkillers, heroin, and fentanyl.

Where Trump’s salary donation to HHS went. The White House said yesterday that it was starting an ad campaign aimed at providing young people with information about the dangers of abusing prescription painkillers. The government is spending $384,000 on the ads, none of which is coming from the $100,000 third-quarter salary Trump donated toward an awareness campaign last year. The Washington Examiner learned that Trump’s salary went to a different ad campaign that is run by the CDC, called “Rx Awareness.” “President Trump is personally dedicated to defeating the opioid crisis,” an HHS representative said. “On Nov. 30, he chose to donate his third-quarter salary to the planning and design of a large-scale public awareness campaign focused on defeating the opioid crisis. President Trump’s donation went towards a different, ongoing targeted-advertising effort being run by the Centers for Disease Control and Prevention — and coordinated with the White House — as part of the whole of government approach the administration has taken to address the opioids crisis.” CDC did not address repeated inquiries about whether the money has been entirely spent or whether it went toward a specific ad.

HHS looks to break down barriers to medical device innovation. Medical device makers shared instances in which regulations have stood in the way of value-based care in a meeting with HHS Secretary Alex Azar. They discussed the Anti-Kickback rule, which prohibits paying for referrals, but the interpretation of it can also capture business arrangements and marketing practices used in other industries. They also pointed to the Stark Law prohibiting self-referrals.  The industry also shared cases in which a product receives approval from the Food and Drug Administration but the Centers for Medicare and Medicaid Services refuses to cover it for Medicare beneficiaries. “Larger message that was shared with Azar yesterday is: all stakeholders should be aware of these potential barriers to care delivery, particularly with new medical device innovations, and to the extent possible, see what we can do to ensure coverage if and when FDA says, ‘Yes, that’s a good product ready for market,’” the industry source said. “That’s the key word here: coverage.” Representatives from Abiomed, AdvaMed, Boston Scientific, CVRx, IlluminOss, STERIS and Varian attended the meeting.

RUNDOWN

Politico The two words you can’t say in a Democratic ad

Des Moines Register A judge has struck down Iowa’s Medicaid ban on transgender transition-related care. Here’s why

Washington Post Federal, state authorities step up fentanyl prosecutions as drug drives spike in overdoses

FierceHealthcare GAO: Medicaid managed care is taming improper payments, or maybe not

The Hill Lawmakers have sights on middlemen blamed for rising drug costs

Scientific American Blood test could predict premature birth risk, due date