*Information in this update is current as of December 13, 2021
As we near the close of 2021, the UnityPoint Health Government & External Affairs team continues advocacy efforts on all UnityPoint Health priorities. This includes outreach to the Congressional delegation to increase awareness and gain their support for our issues within legislative packages that can advance through the legislative process.
What has Congress passed?
Bipartisan Infrastructure Package (BIF)
On November 15, 2021 President Joe Biden signed the $1 trillion bipartisan infrastructure package (BIF) – H.R. 3684. The BIF will cost approximately $550 billion over the next five years—though it has also been characterized as a $1 trillion package, due to the fact that it also utilizes previously approved funding. The BIF focuses on funding for so-called “hard” infrastructure priorities, including highways, railways, water infrastructure, power infrastructure, broadband, job creation and increases clean energy transmission by expanding the electrical vehicles infrastructure and updating the electrical grid.
While the new law has broad implications for the many sectors, it did include a few health-related provisions:
- Broadband: The legislation includes a $65 billion investment in broadband, intended to bridge the digital divide. The majority of the $65 billion BIF broadband funds will be made available through grants to states for qualifying infrastructure, mapping and adoption projects.
- Cybersecurity: This legislation includes new funding for cybersecurity to help federal, state and local government secure their information systems against cyberattacks. The bill also establishes a federal cyber office, the Office of the National Cyber Director, and empowers the U.S. Department of Homeland Security (DHS) Secretary to declare a significant cyber incident.
- Incentivize Domestic PPE Production: The legislation includes the “Make PPE in America Act”. This law places contract requirements encouraging domestic production on federal departments or their designees – namely Homeland Security, Health and Human Services, and Veterans Affairs. It also puts in place provisions related to the transfer of excess PPE or medically necessary equipment in the possession of Health and Human Services and is intended to clarify transfer of items from the Strategic National Stockpile.
- Health Care “Pay Fors”: This legislation includes several health care “pay fors” or offsets to cover the cost of the hard infrastructure provisions. These provisions, taken together, generate savings of $62.6 billion over a 10-year period.
- PBM Rebate Rule: a three-year delay of implementation of the Medicare Part D “rebate rule” from 2023 to 2026. The rule, finalized under the Trump Administration, would have eliminated safe harbor protections for certain Part D rebates and replaced them with protection for discounts offered at the point of sale. In light of significant criticism from stakeholders, implementation of the rule had previously been delayed. Note that the Build Back Better Act currently includes a full repeal of the rebate rule.
- Discarded Medication Costs: reduces Medicare spending on discarded medications from single-dose drug vials. Under BIF, the Health and Human Services Secretary is to aggregate the total discarded amount of Part B medications each quarter, calculate the total cost of the discarded medications based off the Average Sales Price (or Wholesale Acquisition Cost if not available), and notify the drug’s manufacturer that they are required to provide a rebate to HHS for 100 percent of the amount of discarded medication that was recorded above a 10% low-volume threshold. This rebate would be deposited to the Medicare Trust Fund (failure by a manufacturer to provide a timely rebate would incur civil money penalties).
- Medicare Sequestration Extension: This legislation extends the mandatory 2 percent Medicare sequester and requires that in 2031, all the funds would be collected in the first half of the year by increasing the percentage sequestered from 2 to 4 percent for six months.
- COVID-19 Relief Funds: This legislation rescinds $27.9 billion in unobligated COVID-19 relief funds (such as the Paycheck Protection Program, the Education Stabilization Fund and subsidies to U.S. airlines). Of note, BIF did not include the remaining Provider Relief Fund (PRF) as a pay for, which leaves it as a viable source of future health care funding thus far.
2022 Federal Government Budget
To avert a government shutdown and temporarily fund the government, President Biden signed a Continuing Resolution to maintain federal government operations through February 18. At that time, Congress will either need to enact the final 2022 budget or pass another continuing resolution to temporarily extend funding. Since the budget includes operation for federal agencies, UnityPoint Health is always interested in this process. In addition, the budget bill may potentially be used a vehicle to house other legislative priorities, but it is too early to predict what those might be.
On December 10, President Biden signed the “Protecting Medicare and American Farmers from Sequester Cuts Act”. This law addresses what were imminent Medicare cuts that collectively equated to a 9.75 percent reduction and was a key advocacy priority of the Government & External Affairs team. The impact of this law is shown below:
|Cuts||In the Absence of Congressional Action|| |
S. 610 Phase 1
January – March, 2022
S. 610 Phase 2
April – June, 2022
S. 610 Phase 3
|Medicare Physician Conversion Factor (CF)||3.75% (starting Jan. 1, 2022)||.75%||.75%||.75%|
|Medicare Sequestration||2% (starting Jan. 1, 2022)||0%||1%||2%|
|PAYGO Sequestration||4% (starting mid-Jan. 2022)||0%||0%||0%|
|TOTAL Across the Board Cuts**||9.75%||.75%||1.75%||2.75%|
**Merit-based Incentive Payment System (MIPS)-eligible clinicians may also be subject to positive, negative or a neutral adjustment to their CF
The above has significant positive financial implications. Additionally, this law implemented one-year delays for the:
- Protection Access to Medicare Act of 2019 (PAMA) clinical laboratory fee schedule and the private payer laboratory data reporting requirements; and
- Medicare radiation oncology model implementation.
Overall, UnityPoint Health is extremely pleased with this reprieve from Medicare cuts and appreciates the outreach efforts from leadership in terms of urging our Congressional delegation to pass this legislation.
What is pending before Congress?
The Build Back Better (BBB) Act
On November 19, 2021, the House of Representatives approved the Build Back Better (BBB) Act, also referred to as the human infrastructure reconciliation package. The 220-213 vote was largely along party lines, with all present Republicans voting against the measure, and just one Democrat voting no—Rep. Jared Golden (D-ME).
BBB is now being considered by Senate. It is important to note that the text of BBB is expected to change before reaching the Senate floor and the timing of that vote is unclear. First, the Byrd rule prevents extraneous provisions without a budgetary impact from being included in reconciliation bills. That means all eyes are on the Senate parliamentarian as she works through the provisions and issues her rulings. Second, in the tightly divided 50-50 Senate, all 50 Senate Democrats—both progressives and moderates— must be on board in order to pass the bill. It is likely that behind-the-scenes changes will be made to reach consensus. Of note for health care, drug pricing is being targeted as a “pay for” mechanism to fund other programs within the legislation.
At the time of this writing, it is unclear whether this legislation will garner enough votes to pass and what provisions may ultimately be included. Should this pass, a summary of impacted health care provisions will be developed and distributed.
For more information on federal advocacy, legislative, policy and regulatory issues of impact to UnityPoint Health, please contact Cathy Simmons, executive director of government & external affairs for UnityPoint Health or Stephanie Collingwood, government relations specialist.