McDermottPlus Check-Up: May 26, 2023 - McDermott+Consulting

McDermottPlus Check-Up: May 26, 2023


The House was in session this week, while the Senate was in recess. The House Energy & Commerce Committee continued its work on healthcare by advancing six bills that address competition, transparency and access to care. The House Committee on Oversight & Accountability held a hearing to discuss the role of pharmacy benefit managers (PBMs). Debt limit negotiations continued throughout the week, with President Biden and Speaker McCarthy meeting on May 22, and senior staff and lawmakers in near-constant communication in an effort to reach an agreement to raise the debt limit and avoid default before the fast-approaching early June “X date.”


House Energy & Commerce Committee Advances Multiple Healthcare Bills. On May 24, the full House Energy & Commerce Committee held a markup that included six healthcare bills related to competition, transparency and access to care. H.R. 1418, the Animal Drug User Fee Amendments of 2023, would amend the Federal Food, Drug, and Cosmetic Act to reauthorize user fee programs related to new animal drugs and generic new animal drugs. H.R. 2544, the Securing the U.S. Organ Procurement and Transplantation Network Act, would strengthen the Organ Procurement and Transplantation Network and would provide the US Department of Health and Human Services (HHS) with clear authority to expand competition for contracts related to the network’s operation. H.R. 2666, the Medicaid VBPs for Patients (MVP) Act, would amend title XIX of the Social Security Act to codify value-based purchasing arrangements under the Medicaid program and reforms related to price reporting under such arrangements. H.R. 3284, the Providers and Payers COMPETE Act, would require the HHS Secretary to submit an annual report on the impact of certain Medicare regulations on provider and payer consolidation. H.R. 3290 would amend title III of the Public Health Service Act to ensure transparency and oversight of the 340B drug discount program.

H.R. 3561, the Promoting Access to Treatments and Increasing Extremely Needed Transparency (PATIENT) Act of 2023, was considered in the markup as a package of bipartisan bills that would increase price and ownership transparency, reduce healthcare costs and strengthen the health workforce. Provisions in H.R. 3561 include the following:

  • Price transparency requirements
  • Strengthened health insurer transparency requirements
  • Requirements for a separate identification number and an attestation for each off-campus outpatient department of a provider
  • Mandatory reporting with respect to certain health-related ownership information
  • Measures to increase price transparency of clinical diagnostic laboratory tests under Medicare
  • Measures promoting transparency of common ownership interests under Medicare Parts C and D
  • Oversight of PBM services
  • Extension for community health centers, the National Health Service Corps and teaching health centers that operate graduate medical education programs
  • Extension of special diabetes programs
  • Delay of certain disproportionate share hospital payment reductions under the Medicaid program
  • Elimination of $7 billion in the Medicaid Improvement Fund
  • Increased transparency in generic drug applications
  • Parity in Medicare payments for hospital outpatient department services furnished off-campus
  • Measures to improve transparency and prevent the use of abusive spread pricing and related practices in Medicaid

Details on the outcomes of all six healthcare bills include the following:

  • H.R. 1418, the Animal Drug User Fee Amendments of 2023, was advanced with a recorded vote of 49 yays and 0 nays.
  • H.R. 2544, the Securing the U.S. Organ Procurement and Transplantation Network Act, was advanced with a recorded vote of 48 yays and 0 nays.
  • H.R. 2666, the MVP Act, as amended, was advanced with a recorded vote of 31 yays and 19 nays.
  • H.R. 3284, the Providers and Payers COMPETE Act, as amended, was advanced with a recorded vote of 49 yays and 0 nays.
  • H.R. 3290, to amend title III of the Public Health Service Act to ensure transparency and oversight of the 340B drug discount program, as amended, was advanced with a recorded vote of 29 yays and 22 nays, mostly on party lines.
  • H.R. 3561, the PATIENT Act of 2023, as amended, was advanced with a recorded vote of 49 yays and 0 nays.

Having been reported from the Energy & Commerce Committee, these bills could advance to the House floor. The Ways & Means Committee shares jurisdiction on some provisions, however, which could impact both the timeline and contours of the bills before they advance to the House floor. We will be watching for next steps.

House Oversight & Accountability Committee Holds Hearing on Role of PBMs in Prescription Drug Market. On May 23, the House Oversight & Accountability Committee met to discuss PBM oversight, focusing on PBMs’ impact on patient health, independent pharmacies and access to care. The committee discussed PBM practices that may negatively impact both patients and independent pharmacies, as well as the problems of transparency and high drug costs. There was significant discussion between the committee members and witnesses on how the vertical integration of PBMs can cause issues in the prescription drug market. Committee members expressed bipartisan support for addressing all of these issues.


CMS Updates COVID-19 PHE FAQ Page. On May 19, the Centers for Medicare & Medicaid Services (CMS) issued another updated frequently asked questions document on the end of the COVID-19 public health emergency (PHE). This update clarified past guidance on billing for outpatient physical therapy, occupational therapy, speech language pathology services, diabetes self-management training and medical nutrition therapy provided to beneficiaries in their homes through telecommunication technology. CMS continues to update the COVID-19 resource page, which includes fact sheets on various issues related to the end of the PHE.

Our team continues to monitor the transition out of the PHE and will provide additional updates as further information is released.

Administration Announces Proposal to Advance Prescription Drug Transparency in Medicaid. On May 23, CMS released a proposed rule titled Medicaid Program: Misclassification of Drugs, Program Administration and Program Integrity Updates under the Medicaid Drug Rebate Program. The proposed regulation would give CMS and states additional tools, such as a drug price verification survey, that would result in greater transparency into manufacturers’ drug prices. CMS also proposes that contracts between states, Medicaid managed care plans and third-party contractors such as PBMs reflect transparent reporting of drug payment information among third-party contractors.

According to CMS, this proposal will help ensure that taxpayer dollars are actually paying for drugs and not increased profits. The proposed rule includes provisions to ensure that states would receive the rebates to which they are entitled, since states receive a higher percentage of rebate dollars for brand-name drugs compared to generics. CMS proposes steps to further drive down prescription drug costs in Medicaid and build on the Medicare drug price negotiation provisions in the Inflation Reduction Act and President Biden’s executive order to lower prescription drug costs for Americans. Comments on the proposed rule are due by July 25, 2023.

The CMS press release can be found here, and the proposed rule can be found here.


  • The Biden-Harris Administration announced that HHS, through the Assistant Secretary of the Substance Use and Mental Health Administration and in close partnership with the US Department of Commerce, will lead an interagency Task Force on Kids Online Health & Safety. The purpose of the task force is to advance the health, safety and privacy of minors online, with particular attention to preventing and mitigating the adverse health effects of online platforms. By spring 2024, the task force will develop voluntary guidance; policy recommendations; and a toolkit on safety-, health- and privacy-by-design for industry developing digital products and services.


The Senate will be in session, and the House is scheduled to be in recess. However, with June 1 fast approaching and work toward a debt limit deal expected soon, House members are advised to be able to return to Washington with 24 hours of notice.

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

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