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CMS’s Verma says there is a backup plan if anti-Obamacare lawsuit prevails. The Trump administration has a backup plan if a judge strikes down all or parts of Obamacare, Centers for Medicare and Medicaid Services Administrator Seema Verma told reporters Tuesday. “We do have contingency plans” if the healthcare law is struck down, Verma said, referring specifically the provision aimed at ensuring people with pre-existing conditions have access to coverage. But she declined to describe the backup plan, saying that it wouldn’t be appropriate to share details because it may or may not be needed. A decision is expected any day in the case, Texas v. Azar, in which roughly 20 Republican state officials asked for a judge to strike down the Affordable Care Act. The plaintiffs argue that because the individual mandate was zeroed out by Congress as part of last year’s tax law then the rest of the law can no longer stand. The Trump administration sided with the GOP officials in part, but instead of asking for the whole law to be struck down it requested only that the rules related to pre-existing conditions be thrown out, arguing that they are inextricably linked to the mandate.

Verma signals she plans to stick around. Asked at the meeting whether she was planning an exit from the Trump administration, Verma replied: “I serve at the pleasure of the president. The more I get into it, there is a lot to be done in healthcare. After 1.5 years I have only just gotten started.”  

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Details of state flexibility are coming Thursday. The Trump administration announced in October that it would be allowing states more flexibility in how they craft 1332 waivers, a part of Obamacare that gives state officials and lawmakers a certain amount of leeway for rewriting rules about how the healthcare law operates in their state. On Thursday, Verma will present examples of the types of programs that states might consider. So far most of the approved waivers have been on reinsurance, a program that helps to shore up Obamacare markets by funneling federal funds toward more expensive claims and keeping premiums at bay.

Trump administration defends Medicaid work requirements. The Trump administration will support Medicaid work requirements despite such rules resulting in more than 12,000 people being knocked out of the program in Arkansas, Verma said. “We remain steadfast in our belief that this policy is important for the program,” she said. The requirements stipulate that certain enrollees work, volunteer, or take classes in order to stay enrolled in Medicaid, which is paid for by states and the federal government.

Trump administration seeks to lower drug prices by giving insurers more power. The Trump administration is proposing to let insurers have more control over which drugs they offer through Medicare in an attempt to lower high drug prices. The Centers for Medicare and Medicaid Services released a proposed rule on Monday that gives insurers in Medicare’s prescription drug plan more power to negotiate for lower prices for certain types of drugs. Medicare Part D, the program’s prescription drug plan through which seniors use private plans to buy drugs at the pharmacy, currently requires private plans to offer all drugs in six classes, including antidepressants and antipsychotics. The requirement has meant that private plans have not been able to fully negotiate for lower prices for the drugs in the six classes. The proposal would allow private plans to use tools called step therapy and prior authorization for drugs in the six classes. Through step therapy, a patient would only be able to get access to a pricey drug if a cheaper version did not work. Prior authorization requires an insurer to authorize a prescription of a product before a doctor writes the prescription. CMS also aims to allow drugmakers to withhold a protected class drug if the price for that product skyrockets over a certain benchmark.

More changes for rebates and ‘clawbacks’ on the horizon. The agency is also considering a proposal that would tackle “back-end” deals between insurers and pharmacies. Sometimes insurers or pharmacy benefit managers, which manage drug plans for employer and union-sponsored plans, collect fees from pharmacies in the form of administrative or service fees. “Independent pharmacies have raised concerns that back-end deals with health insurance plans are eroding competition and making it harder for them to continue providing medications to beneficiaries,” Verma wrote. “Plans can set performance requirements for pharmacies that may not be achievable, leading to large financial clawbacks from pharmacies and swings in revenues that pharmacies cannot manage.” Verma added that seniors aren’t benefiting from the deals and are paying a price that is “higher than the amount that pharmacies are actually reimbursed for drugs.”

Insurers cautious about the move. The proposed rule earned a cautious statement from America’s Health Insurance Plans, the insurance industry’s leading lobbying group. It cheered the administration for attempting to strengthen negotiating leverage, including for drugs “for which rebates have often been limited or unavailable.” The group also agreed that “prudent use of formulary tools” are essential to ensure reasonably priced medicines are available. The Better Medicare Alliance, a collection of insurers that advocate for changes to Medicare Advantage, gave a more full-throated endorsement. Medicare Advantage allows seniors to use their benefits to buy a private plan. It said that giving Medicare Advantage plans the ability to negotiate for protected class drug prices “will result in lower costs for beneficiaries who need these drugs while maintaining current consumer protections.”

But patient and oncology doctor advocacy groups are really, really not happy. CMS upset a patient advocacy group supporting patients with HIV and a group supporting oncology practices. The Community Oncology Alliance and the AIDS Institute both warned that prior authorization or step therapy could hinder patient access to needed drugs. “This proposal runs contrary to current U.S. government HIV treatment guidelines, which state that prior authorizations for HIV drugs ‘result in fewer prescriptions filled and increased nonadherence…. and have substantially reduced timely access to medications,’” the AIDS Institute said. The COA, which represents small oncology practices, said that adding step therapy to protected class drugs will hurt patients because “step therapy requirements are driven by financial interests to save money and not by what is in the best medical interest of patients.” COA also opposed CMS’ decision to apply step therapy to physician-administered drugs reimbursed by Medicare, which includes chemotherapy.

New generic EpiPen not much cheaper. The Trump administration touted the approval of a generic version of EpiPen earlier this year as evidence that their fight against high drug prices was working. But then the price tag for that generic came in at $300, according to several reports. That price is cheaper than the $600 for the EpiPen from manufacturer Mylan, which sparked an uproar back in 2016. However, Mylan that same year created it’s own generic version of the EpiPen and priced it at $300. The Trump administration believed that approval of a generic from a competitor, in this case Teva Pharmaceuticals, would lead to a lower price. However, it is the same price as Mylan’s authorized generic version.

Pharma makes a last-ditch lobbying effort to save $4 billion. The pharmaceutical industry is expected to try this month to lobby its way out of giving seniors enlarged discounts on Medicare drugs, putting insurers, hospitals, and patient groups in a defensive posture. The pharmaceutical industry has one last chance in 2018 to get Congress to undo the added discounts it must provide to seniors in Medicare’s drug coverage gap, which requires seniors to pay high out-of-pocket costs for drugs. Congress must pass legislation by Dec. 7 to fund the government, and — opponents suspect — the pharmaceutical industry will try to attach language to the spending bill to change the discounts and reap a $4 billion windfall. The Pharmaceutical Research and Manufacturers of America did not disclose its lobbying strategy but said that it does want to change the discount, which it said was based on a technical error that the Congressional Budget Office made in scoring the spending bill. “Closing the donut hole is a good thing, but how the [Bipartisan Budget Act] did it was wrong for seniors and wrong for the Part D program,” the association told the Washington Examiner. PhRMA has taken out several ads pressuring lawmakers on the discount. Any deal to fund the government would likely be the last major legislation of 2018, and the pharmaceutical industry’s best chance to roll back the bigger discount before it goes into effect.

1 in 40 children have autism diagnosis: HHS. A new study led by the Health Resources and Services Administration found that about 1.5 million children, or 1 in 40, have been diagnosed with autism spectrum disorder. The study, published in Pediatrics, also found that more a quarter of children with autism were taking medication for symptoms, and nearly two-thirds received behavioral treatments during the last year. Parents reported that their children with autism were significantly less likely to get needed mental health care compared to children with other emotional, behavioral, or developmental conditions.

FDA says some Romaine lettuce is fine to eat. Romaine lettuce can be safe to eat if it is labeled with a harvest location and date that is outside of the California growing region, the Food and Drug Administration said Monday. The FDA and Centers for Disease Control and Prevention had issued an alert last week, before Thanksgiving, that consumers should not eat any romaine lettuce because of an E. coli outbreak that sickened 43 Americans and 22 Canadians. But the FDA said on Monday that it was loosening the restriction — but with major caveats. “Romaine lettuce entering the market can also be labeled as being hydroponically or greenhouse grown,” the agency said. “If it does not have this information, you should not eat or use it.”

FDA approves cancer drug that will cost nearly $33,000-a-month cancer drug. The FDA has approved a drug called Vitrakvi that is able to treat different kinds of tumors regardless of where they are in the body. It’s only the second to fit that description and was approved for both adults and children. The type of cancer is rare, affecting no more than 3,000 patients each year. Drugmaker Loxo Oncology, Inc., and its partner Bayer said the list price for the drug would be $32,800 for a 30-day supply of capsules for adults and $11,000 for children. Patients are expected to pay $20 a month in out of pocket costs.

CDC confirms 116 cases of polio-like illness. At least 116 cases of acute flaccid myelitis have been confirmed by the Centers for Disease Control and Prevention, but the agency is suspecting as many as 286 additional cases. This total would put 2018 at the businest rate for the illness, which causes muscle weakness and paralysis. Experts are still in the dark about the cause, but suspect a virus may be behind the surge.

CVS completing $69 billion Aetna merger after winning state approvals. CVS Health’s $69 billion acquisition of health insurer Aetna is expected to close on Wednesday after the firms received final regulatory approvals from state insurance agencies, the pharmacy chain said in a government filing on Monday. The deal, which won approval from the Department of Justice in October, is one of several expected to transform the current U.S. healthcare system. Fellow pharmacy benefit manager Express Scripts is finalizing its merger with insurer Cigna after receiving federal approval in September, while Walgreens Boots Alliance and Humana are reportedly in investment talks. By combining with Aetna, CVS Health says it will reduce overall healthcare costs for consumers, cut $750 million in operational expenses and improve customer adherence to prescription drug-treatment plans. “The longer-term medical cost savings will come from new programs that are only made possible through the combination and close integration of our two companies ,” Chief Executive Officer Larry Merlo told investors earlier this month.

Pets on planes? Federal government to weigh updated rules next spring. The Transportation Department is set to issue new guidance next spring on what constitutes a service pet and which animals passengers can and cannot bring on commercial airplanes.

The department plans to issue a Notice of Proposed Rulemaking in March 2019 that would address the appropriate definition of a service animal and include safeguards to ensure safety.

The regulation, disclosed in the agency’s fall regulatory agenda and not previously reported, would also aim to reduce the likelihood that passengers wishing to travel with their pets on aircraft will be able to falsely claim that their pets are service animals. No changes or recommendations to federal policy are expected before the busy holiday travel season.

Report: Insurers deny one in every 10 claims for medical testing or screening. A new report from the Doctor-Patient Rights Project found that health insurers are using inconsistent and vague standards to deny coverage for both preventive and emergency medical care. Chief among the findings is that insurers deny one in every 10 claims for medical testing or screenings, which affect as many as 7.7 million insured Americans. It also found that The report was based on all types of insurance. The group, a nonprofit patient and doctor advocacy organization, also found that many patients are retroactively denied emergency room care because the insurer finds the visit could be “avoidable.” It also found that insurers are “overriding doctors’ treatment decisions by questioning the medical necessity of a procedure, putting the burden on the patient and their doctor to prove that the procedure they want is necessary.

RUNDOWN

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