McDermottPlus Check-Up: March 15, 2024 - McDermott+Consulting

McDermottPlus Check-Up: March 15, 2024


  • President Releases FY 2025 Budget: The budget requests $130.7 billion in discretionary spending for the US Department of Health and Human Services (HHS) for fiscal year (FY) 2025.
  • House Ways & Means Committee Holds Hearing on Healthcare in the Home: The committee discussed technological advances and flexibilities that increase accessibility for rural and underserved communities.
  • House Energy & Commerce Health Subcommittee Holds Markup of Public Health Bills: The committee advanced 19 bills designed to support patients and caregivers.
  • Senate Finance Committee Holds Hearing on President’s FY 2025 HHS Budget: HHS Secretary Becerra provided his first congressional testimony on the president’s budget request and fielded questions.
  • HHS Responds Further to Change Healthcare Cyberattack: HHS wrote a letter urging private sector cooperation, the Office of Civil Rights (OCR) announced that it will launch an investigation into compliance with Health Insurance Portability and Accountability Act (HIPAA) rules, and the Centers for Medicare & Medicaid Services (CMS) released a new frequently asked questions (FAQ) document on accelerated and advance payments.


House Ways & Means Committee Holds Hearing on Health at Home. The hearing’s purpose was for the committee to discuss the technological advances and flexibilities that have made quality care in the home possible (including home dialysis, infusions, telehealth, hospital at home and remote patient monitoring), with a focus on the importance of these services in rural and underserved communities. Members and witnesses focused on the fact that Medicare telehealth and hospital at home flexibilities are set to expire on December 31, 2024, without congressional action, and on the importance of extending these flexibilities to ensure continued access to care. There was bipartisan recognition of these technologies’ ability to improve access and reduce costs. Some committee members and witnesses raised concerns about equitable access to new technologies for rural and underserved communities.

House Energy & Commerce Health Subcommittee Holds Markup of Public Health Bills. The subcommittee advanced 19 bills focused on supporting patients and caregivers in the areas of autism, heart defects, Alzheimer’s disease, breast cancer screening, stillbirth, lung cancer, cardiomyopathy and Down syndrome. The bills also included resources to promote utilization of mental health and substance use disorder services among healthcare professionals. Summaries of each bill can be found in the subcommittee’s markup memo.

All 19 bills advanced out of the Health Subcommittee and now await consideration by the full committee. While 17 bills were unanimously supported, the following bills faced opposition from Democrats:

  • H.R. 5074, Kidney PATIENT Act.
    • Advanced by a vote of 16 yeas and 10 nays.
    • Rep. Barragan (D-CA) was the only Democrat to vote yea.
  • H.R. 5526, Seniors’ Access to Critical Medications Act of 2023.
    • Advanced by a vote of 19 yeas and six nays.
    • All Republicans voted yea. Subcommittee Ranking Member Eshoo (D-CA) and Reps. Ruiz (D-CA), Kelly (D-IL), Barragan (D-CA) and Cardenas (D-CA) voted yea. Full Committee Ranking Member Pallone (D-NJ) and Reps. Sarbanes (D-MD), Craig (D-MN), Schrier (D-WA), Trahan (D-MA) and Dingell (D-MI) voted nay.

Senate Finance Committee Holds Hearing on FY 2025 HHS Budget. This was the first of HHS Secretary Becerra’s appearances to promote the president’s healthcare priorities in his budget. During the hearing, Democratic members commended the Administration’s efforts to lower drug prices and expand coverage, while Republican members expressed concern with HHS’s placement of unaccompanied immigrant children with sponsors and proposed minimum nurse staffing requirements. Senators agreed that drug prices should be lowered for consumers, and there was bipartisan disappointment that pharmacy benefit manager reform was not included in the budget. Members also expressed significant concern on the Change Healthcare cyberattack and Secretary Becerra noted HHS would be holding another meeting on the issue with health plans. The meeting is expected to be held on March 18.


President Releases FY 2025 Budget. On March 11, President Biden released his FY 2025 budget. The budget requests $130.7 billion in discretionary spending for HHS for FY 2025. This requested amount is a 1.7% increase ($2.2 billion) in discretionary spending for HHS compared to FY 2023 funding levels.

Accompanying the full budget is the HHS Budget in Brief, which provides additional details on the Administration’s health policy priorities. Highlights in the HHS budget include extending the $35 cost-sharing cap for a month’s supply of a covered insulin product to the commercial market, increasing the number of prescription drugs subject to the Medicare Drug Price Negotiation Program from 20 to 50, expanding continuous eligibility for children in Medicaid, increasing funding for healthcare workforce programs, and providing cybersecurity funding to support existing programs and new requirements – and enforcement – for hospitals to meet minimum cybersecurity standards.

It is important to remember that the president’s budget will not go into place as proposed. It is a statement of the president’s priorities, and many components would require congressional action. It should be viewed as a representation of the policies President Biden will pursue if he is elected to a second term.

HHS Responds Further to Change Healthcare Cyberattack. The letter called on UnitedHealth Group, other insurance companies, clearinghouses and healthcare entities to take additional actions to mitigate the harms of this attack on patients and providers.

HHS also noted steps CMS is taking to assist states and healthcare providers in continuing to serve patients and avoiding disruptions. CMS has streamlined the process for providers to change clearinghouses to ensure continuity of payments, encouraged insurance plans to remove or relax prior authorization requirements in both Medicare and Medicaid, and directed Medicare Administrative Contractors (MACs) to be prepared to accept paper claims submissions during the course of the outage. CMS also provided instructions to MACs about how to consider applications for accelerated payments from Medicare Part A providers and for advance payments from Part B providers and suppliers. The agency released a frequently asked questions (FAQ) document on the issue as well.

On March 12, HHS also held a call to hear from hospitals, children’s health providers, physicians, infusion centers, pharmacies, community health centers and long-term care facilities across the country on the broad impact the cyberattack on Change Healthcare has had on the healthcare sector. Participants highlighted gaps in the response from payers, including the need for more immediate payment options, direct communications, and relaxed billing and claims processing requirements. The Administration called upon healthcare payers to consider additional steps to reduce red tape and provide accessible funding opportunities through advanced payments and through other means to provide productive solutions to address the cash flow issues that providers are experiencing.

Finally, on March 13, OCR released a short letter to stakeholders outlining the responsibilities of health insurers and providers under HIPAA privacy, security and breach notification rules. OCR stated in the letter that given the magnitude of the Change Healthcare cybersecurity attack, OCR will initiate an investigation into the incident. OCR’s investigation of Change Healthcare and UnitedHealth Group will focus on whether a breach of protected health information occurred and on Change Healthcare’s and UnitedHealth Group’s compliance with the HIPAA rules.


  • CBO Provides Answers to House Budget Committee Questions for the Record. On January 31, the House Budget Committee convened a hearing at which Congressional Budget Office (CBO) Director Phillip Swagel testified about the work of CBO. After the hearing, Chairman Arrington (R-TX) and Reps. Carter (R-GA), Cline (R-VA), Ferguson (R-GA) and Yakym (R-IN) submitted questions for the record. In particular, CBO provided answers in regard to an analysis of the use of anti-obesity medications and the financial and budgetary impacts of pharmacy benefit manager legislation.
  • Administration Launches White House Challenge to Save Lives from Overdose. The challenge is a nationwide call-to-action to stakeholders across all sectors to save lives by committing to increase training on and access to lifesaving opioid overdose reversal medications. Organizations may make a commitment here and share a story of how their efforts saved a life here.
  • CMS Holds Webinar on Medicaid HCBS Programs. The purpose of this call was to provide states with an overview of social determinants of health (SDOH), review the CMS state health official letter regarding SDOH, highlight tools within home- and community-based services (HCBS) to address SDOH, and share state strategies to leverage Medicaid HCBS to improve SDOH. The slides for this webinar may be found here.
  • CMS Holds AHEAD Model Webinar. CMS answered questions relating to the Advancing All-Payer Health Equity Approaches and Development (AHEAD) model application submission and the hospital global budget and its methodology. Applications for the first and second cohort are due March 18, 2024. CMS is seeking applicants for the third cohort of the model, which are due August 18, 2024.
  • Bipartisan Group of Senators Introduce Bill to Improve Care for Medicare Dual Eligibles. Sens. Carper (D-DE), Cassidy (R-LA), Scott (R-SC), Warner (D-VA), Cornyn (R-TX) and Menendez (D-NJ) introduced a bill that would require each state to have at least one integrated health plan for dual eligibles. It also seeks to reduce the number of “look-alike” plans that don’t offer any coordination or abide by Medicare and Medicaid rules for duals plans. The bill would reduce incentives for third-party marketing organizations to target potential dual beneficiaries.


The House and Senate are scheduled to be in session next week, with healthcare activity at the committee level, including a House Energy & Commerce Health Subcommittee hearing on diagnostic tests and a House Ways & Means Committee field hearing in Denton, Texas, on emergency medical care. The budget hearings also continue next week, with House Ways & Means Committee and House Appropriations Labor-HHS Subcommittee hearings with HHS Secretary Becerra on the president’s healthcare budget policies.

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

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