McDermottPlus Check-Up: April 28, 2023 - McDermott+Consulting

McDermottPlus Check-Up: April 28, 2023


Congress was in session, and it was a busy healthcare week at the committee level, with six hearings focused specifically on health issues. On the House floor, Republicans passed the Limit, Save, Grow Act—a bill that raises the debt limit into 2024 while also cutting federal spending by tens of billions of dollars. The package includes Medicaid work requirements and provisions to rescind any unspent COVID-19 relief funding. These provisions were nonstarters for Democrats, who unanimously voted against the package. The US Department of Health and Human Services (HHS) issued a proposed rule to expand healthcare coverage for Deferred Action for Childhood Arrivals (DACA) recipients and updated enforcement action on its hospital price transparency requirements.


House Energy and Commerce Subcommittee Considers Healthcare Bills Focusing on Transparency. On April 26, the Energy and Commerce Health Subcommittee held a legislative hearing to consider 17 healthcare bills focused mainly on transparency and competition. The subcommittee heard testimony from Centers for Medicare & Medicaid Services (CMS) Administrator Chiquita Brooks-LaSure, along with a second panel of stakeholder witnesses.

This was Administrator Brooks-LaSure’s first appearance before a House committee, and she took the opportunity to highlight the Administration’s commitment to hospital price transparency. Shortly after her appearance, CMS released a fact sheet outlining the updates it is making to increase compliance with existing hospital price transparency requirements. Among other changes, CMS will now automatically impose a civil monetary penalty on hospitals that fail to submit a timely corrective action plan.

The 17 bills up for discussion are summarized in this committee memo, and links to legislative text are included here. The slate of bills include formally introduced legislation (all bipartisan) and unintroduced discussion drafts. Topics include targeted transparency on hospital pricing, pharmacy benefit managers (PBMs), the 340B program and more.

Subcommittee members expressed bipartisan support for increased transparency to better understand what drives high pharmaceutical and healthcare costs. PBM practices and hospital price transparency were major concerns for the members. CMS’s decision to restrict access to Alzheimer’s medications was also a topic of discussion.

Some members expressed concerns with pending payment cuts to the Medicaid disproportionate share program that protects safety net hospitals. Several spoke about the importance of the 340B program in helping hospitals that support underserved populations, and some members emphasized their desire to enhance reporting requirements, which they said would address program integrity.

Bills related to site neutrality were also discussed at length. With the exception of the American Hospital Association witness, the witnesses noted the importance of site neutrality for basic services at physician offices and outpatient hospital sites, and committee members broadly agreed with them. The discussion noted that the difference in these site-based payments incentivizes consolidation in the healthcare market, which, it was argued, drives up costs for everyone.

The lengthy hearing highlighted the potential for committee members to work together on targeted bipartisan healthcare legislation this Congress. Our team will be closely monitoring next steps, including a potential markup of any of the legislation reviewed at this hearing.

House Ways and Means Committee Holds Hearing on Tax-Exempt Hospitals. The Ways and Means Oversight Subcommittee also met on April 26 to examine issues related to tax-exempt hospitals and the community benefit standard. The hearing explored the requirements for a nonprofit hospital to qualify for tax-exempt status, challenges in verifying compliance with some of those requirements, and nuances in community needs.

The panel of stakeholder and expert witnesses discussed the value of tax exemption for hospitals and their communities, federal oversight of community benefits, concerns about the adequacy of government requirements, and the impacts of proposed policies to strengthen requirements for tax-exempt status.

House Committee on Education and the Workforce Holds Healthcare Hearing. Also on April 26, the Education and Workforce Subcommittee on Health, Employment, Labor and Pensions held a hearing to discuss legislative solutions for healthcare challenges facing working families and small businesses.

The panel of witnesses made several policy recommendations, such as expanding coverage options and flexibility of benefits for small business owners, allowing for association health plans, offering financial incentives to ensure that coverage remains viable, increasing transparency, and enacting policies that lower the cost of prescription drugs and healthcare services.

Rep. Walberg (R-MI) spoke in support of his bipartisan legislation to continue a pandemic flexibility that allows employers to offer workers standalone telehealth benefits (H.R. 824). Some Democrats expressed concerns related to transparency and siloing of telehealth benefits, and Subcommittee Ranking Member DeSaulnier (D-CA) noted his interest in working with Republicans on telehealth coverage issues.

House Appropriations Committee Holds Health-Related Oversight Hearing. Rounding out the committee action on April 26, the Appropriations Labor-HHS Subcommittee held an oversight hearing on the provider relief fund (PRF) and healthcare workforce shortages, featuring testimony from Health Resources and Services Administration (HRSA) Administrator Carole Johnson.

The hearing largely focused on workforce shortages and the grants HRSA provided to recruit and retain a strong healthcare workforce. Republican members also raised questions about waste and improper use of funds in the PRF, and Democrats expressed overall concerns that Republican budget cuts would limit access to healthcare.

Senate Committees Move Ahead on Drug Pricing Reform Efforts. On April 25, Senate Health, Education, Labor and Pensions (HELP) Committee Chair Sanders (I-VT) and Ranking Member Cassidy (R-LA) announced a bipartisan agreement on legislation to lower prescription drug prices. On May 2, the committee will consider four bills related to PBM reform and expanded generic drug availability. At this time, insulin pricing legislation is not on the agenda.

The HELP Committee announcement followed the April 20 release by Senate Finance Committee Chair Wyden (D-OR) and Ranking Member Crapo (R-ID) of a bipartisan framework that the committee will use to advance legislation to modernize and enhance federal prescription drug programs this summer, with the goal of reducing drug costs for patients and taxpayers. The framework outlines key challenges facing federal prescription drug programs and identifies potential policy solutions, including PBM reforms, modernizing Medicare options and increasing transparency.


HHS Proposes to Expand Healthcare for DACA Recipients. On April 24, HHS and CMS released a proposed rule that, if finalized, would provide healthcare coverage for DACA recipients through Medicaid, the Children’s Health Insurance Program (CHIP), subsidized exchange coverage and basic health plans under the Affordable Care Act. The effective start date would be November 1, 2023, ahead of the open enrollment period for 2024.

The rule proposes to change the definition of “lawfully present” to include DACA recipients, who would thus become eligible for coverage. HHS estimates that about 129,000 DACA recipients would have access to health coverage. The agency estimates that most DACA recipients (about 112,000) would enroll in an exchange plan in 2024, while about 4,000 would sign up for a basic health plan, and about 13,000 would have coverage through Medicaid and CHIP in states that elected to cover lawfully residing women and children under a state option created by Congress in a CHIP reauthorization.

An HHS press release contains additional information. Comments on the proposed rule are due by June 23.

CMS Issues Proposed Medicaid Rules. On April 27, CMS released two proposed rules for the Medicaid program: Ensuring Access to Medicaid Services and Medicaid and Children’s Health Insurance Program Managed Care Access, Finance, and Quality.

The Ensuring Access rule (fact sheets here and here) proposes changes to current requirements as well as new requirements that would advance CMS’s efforts to improve access to care, quality and health outcomes and better promote health equity for Medicaid beneficiaries across fee-for-service and managed care delivery systems, including home and community-based services provided through those delivery systems.

The Managed Care proposed rule (fact sheet here) aims to help states build stronger programs to better meet the needs of the Medicaid and CHIP populations by improving the quality of, and access to, care provided to Medicaid and CHIP managed care enrollees. Together, the Ensuring Access and Managed Care proposed rules include new and updated proposed requirements for states and managed care plans that would establish consistent access standards, a consistent way to transparently review and assess Medicaid payment rates across states, and a way for enrollees to compare plans based on quality and access.

Public comments are requested, including responses to specific questions articulated throughout the publications. Comments are due by July 3.


Supreme Court Rules on Abortion Drug Access. On April 21, the Supreme Court of the United States issued a stay on a recent district court ruling that would restrict access to the abortion pill mifepristone and reverse the US Food and Drug Administration’s approval of the generic version of the drug. The high court’s decision allows the drug to remain on the market under current prescribing and dispensing rules while the US Court of Appeals for the Fifth Circuit reconsiders the district court ruling.


  • The House Energy and Commerce Subcommittee on Innovation, Data and Commerce held a hearing on addressing data privacy shortfalls. The subcommittee discussed gaps in protecting consumers’ personal information, how businesses navigate compliance with sectoral laws, and how Congress can act to fill gaps in privacy and data security.
  • The House Energy and Commerce Subcommittee on Oversight and Investigations held a hearing on antimicrobial resistance (AMR). The subcommittee examined ongoing concerns about AMR, specific factors that may contribute to its rise, current public and private sector efforts to combat AMR, and potential solutions to address the issue.
  • The Senate Finance Committee scheduled a hearing on mental health care barriers for May 3. The hearing will focus on efforts to improve provider directory accuracy to reduce the prevalence of “ghost networks,” the term often used to describe network lists of providers that are not accepting new patients or are otherwise inaccurate.
  • The Senate HELP Committee scheduled a hearing on preparing for the next public health emergency on May 4. The hearing will focus on the reauthorization of the Pandemic and All Hazards Preparedness Act.
  • The Senate HELP Committee also scheduled a hearing on insulin affordability for May 10 that will feature testimony from the CEOs of major insulin manufacturers.


  • HHS released a new analysis showing that access to health coverage for approximately 21 million Americans could be jeopardized if the Medicaid work reporting requirements set forth in House Republicans’ debt ceiling bill were implemented. The information is based on CMS data and shows the potential effects on all states that have expanded Medicaid under the Affordable Care Act.
  • The Congressional Budget Office (CBO) released an estimate of the budgetary effects of the Medicaid work requirements included in House Republicans’ debt limit bill. CBO estimates that the provisions would reduce spending by $109 billion over a 10-year period, and that 1.5 million adults, on average, would lose federal funding for their Medicaid coverage. CBO expects that many states would cover the cost of maintaining insurance coverage for affected people. In total, an estimated 60% (or about 900,000 people) would remain in their state’s Medicaid program under state-only funding, and 40% (or about 600,000 people) would become uninsured.
  • As the May 11 end date of the COVID-19 public health emergency fast approaches, CMS released an updated frequently asked questions document. The questions are divided into four categories (general, Medicare, Medicaid and CHIP, and private insurance) and cover issues such as cost and reimbursement for vaccines, testing and treatment, as well as more specific topics such as telehealth; reporting requirements for nursing homes, hospitals and critical access hospitals; and the end of Medicaid continuous enrollment.


The Senate will be in session. The House will hold a district work week. The Senate HELP Committee will hold an executive session to consider drug pricing legislation and a hearing on pandemic preparedness, and the Senate Finance Committee will hold a hearing on mental health provider directory accuracy.

For more information, contact Debra CurtisKristen O’Brien or Erica Stocker.

To subscribe to the McDermottPlus Check-Up, please CLICK HERE.