McDermottPlus Check-Up: January 29, 2021 - McDermott+Consulting

McDermottPlus Check-Up: January 29, 2021

This Week’s Dose

Congress continued negotiations on another coronavirus (COVID-19) relief bill, and President Biden took a series of executive actions on equity and healthcare.


Lawmakers Continued Negotiations on Additional COVID-19 Relief. President Biden has proposed a $1.9 trillion package that many congressional Democrats support. Though there is bipartisan support for many aspects of the plan, including additional resources for vaccination and testing, many Republicans oppose the overall spending levels and some features of the President’s proposal, including most notably additional stimulus spending and aid for state and local governments. Without Republican support, Biden’s proposal will be unable to meet the 60-vote threshold needed to overcome a filibuster and advance in the Senate (barring action to end the filibuster, which seems unlikely at this time). Democrats can either narrow the proposal to try to secure bipartisan support or pursue passage through budget reconciliation, a process requiring a simple majority. This week, House Leadership, Senate Majority Leader Chuck Schumer (D-NY) and the President have expressed support for reconciliation as an option even though that could limit the bill, as the process can only be used for provisions that directly impact federal spending. Opting for a reconciliation process, however, not only limits the range of provisions that can be included, it also further erodes the prospect for any bipartisan collaboration, thus making reconciliation an available option, but not a cost-free one for Democrats. Democrats are starting to work on a budget resolution to make reconciliation available, if needed, and to press Republicans for more collaboration.


Biden Signed Executive Order Aimed at Strengthening Medicaid and the ACA. The executive order (EO) directs the Secretary of Health and Human Services (HHS) to consider opening a special enrollment period (SEP) for the Federally Facilitated Marketplace as a result of the COVID-19 pandemic, which the Centers for Medicare and Medicaid Services (CMS) did shortly its release (the SEP will run from February 15, 2021, to May 15, 2021). The EO also directs federal agencies to review policies that threaten pre-existing condition protections, reduce coverage, undermine the Affordable Care Act (ACA) or make it more difficult to enroll in the ACA and Medicaid, and that reduce coverage affordability. Finally, the EO rescinds two Trump Administration EOs that directed executive departments to waive or delay the implementation of any provision of the ACA that would impose a fiscal burden; and expanded the use of association health plans, short-term, limited-duration insurance (STLDI) plans, and health reimbursement arrangements. Though rescinding the Trump Administration EOs sends a clear political message, we expect the Biden Administration to issue more regulations and guidance to actually implement the policy change, including reversing allowances for Medicaid work requirements or capped financing structures, expansion of STLDI plans, and changes to 1332 waiver guidance.

Biden Issued Memoranda on Equity and Women’s Health. The memoranda direct the Secretary of HHS to consider guidance on best practices for advancing cultural competency, language access and sensitivity towards Asian Americans and Pacific Islanders in relation to the government’s COVID-19 response; and the Secretary of Housing and Urban Development to implement the Fair Housing Act to prevent housing discrimination. In addition, President Biden issued a memorandum revoking the Mexico City Policy, which prohibited federal funding from going to international non-profits that provide abortion counseling or referrals. The memorandum also directs HHS to consider rescinding a Trump Administration final rule that barred healthcare providers who offer abortion services or referrals from receiving funding under the Title X family planning program, and any other rules that impose “undue restrictions” on women’s access to complete medical information.

Public Health Emergency Expected to Continue Through 2021. In a letter to governors, HHS announced that the Administration is likely to keep the Public Health Emergency (PHE) in place through 2021, and that the Administration will provide states 60 days’ notice prior to termination. Among other things, the PHE declaration allows for the expanded use of telemedicine, waivers of various Medicare and Medicaid requirements, and the 6.2% increase in the Federal Medical Assistance Percentage. The announcement gives states and the healthcare community more predictability given that the PHE can only be renewed 90 days at a time (the current declaration was renewed on January 21, 2021).

Quick Hits

  • In accordance with the regulatory freeze announced last week, the Biden Administration paused implementation of a Trump Administration final rule that would eliminate drug rebates for pharmacy benefit managers. The effective date was delayed from January 29, 2021, to March 22, 2021.
  • The White House resumed regular public briefings on the COVID-19 response led by the Administration’s health officials. The briefings are expected three days a week.
  • The Administration announced plans to purchase 200 million additional doses of the Pfizer and Moderna vaccines that will be available this summer.
  • The HHS Office of Inspector General published a report, which found that the Department misused millions of dollars intended for vaccine research and emergency preparedness since 2010.
  • CMS released a request for applications for standalone prescription drug plans (PDPs) and Medicare Advantage PDPs interested in participating in the Medicare Part D Modernization model in calendar year 2022. PDPs interested in applying must submit a notice of intent by March 1, 2021.
  • Johnson & Johnson announced that its COVID-19 vaccine was 72% effective in late-stage trials and, if the vaccine is authorized, could provide 100 million doses by the end of June. The Johnson & Johnson vaccine only requires one dose, unlike the Pfizer and Moderna vaccines that require two.

M+ Resources

  • Addressing surprise billing has been a priority for Congress for more than two years and culminated in provisions being included in the Consolidated Appropriations Act, 2021 (CAA) that was signed into law on December 27, 2020. Our consultants discuss the surprise billings provisions included in the CAA on this week’s episode of the Health Policy Breakroom, and more information is available in this article.

Next Week’s Diagnosis

Congress will continue negotiations on COVID-19 relief and confirmation hearings for President Biden’s nominees. The House Energy and Commerce Oversight and Investigations Subcommittee will hold a hearing on February 2 on ways to increase COVID-19 vaccinations, and the Health Subcommittee will hold a hearing on February 3 on ramping up the medical supply chain.


For more information, contact Mara McDermottKristen O’BrienRachel Stauffer, Katie Waldo or Emma Zimmerman.

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