AMCP Keeps Tabs on Legislative and Regulatory Developments

2021 began with a new administration in the White House, a new majority party in Congress, and a continuing global pandemic. Despite these changes, health care legislation and regulation continue to rapidly evolve.

At its virtual annual meeting, AMCP’s Policy and Government Relations team offered updates on a full slate of legislative proposals and regulatory developments. The AMCP panel consisted of Adam Colborn, JD, manager of policy & government relations; Jennifer Mathieu, director of government relations; and Carrie Monks, director of regulatory affairs.

Ms. Mathieu said that AMCP’s 2021 government relations priorities are (1) the rising cost of pharmaceuticals and price transparency, (2) the shift from FFS to value-based care, and (3) the promotion of managed care pharmacy strategies. These priorities are reflected in the current federal legislative agenda, covering preapproval information exchange (PIE) legislation, COVID-19 relief, drug pricing, and managed care tools.

One area that should stay in the public eye, she noted, was Medicare sequestration. Ms. Mathieu stated that the moratorium on the existing budget sequestration (i.e., 2% Medicare payment cuts) expired on March 31. The House of Representatives passed HR 1868 on March 19, 2021, and the Senate amended the bill by removing a provision preventing a scheduled 4% cut in 2022. The House is set to vote on the Senate’s version of the bill, and all indications are that it will pass. CMS will make retroactive payments if this does occur. Upon passage, the moratorium is extended to December 31 of 2021. The question remains, however, how far Congress will be willing to delay reimplementation of the sequestration cuts, as this affects how much Medicare pays hospitals and clinicians for services they provide.

The Biden administration’s infrastructure plan includes health care and drug pricing components, and more information about these aspects are expected in late April or early May, according to Ms. Mathieu. The plan includes HR 3 and S2543 (Lower Drug Costs Now Act and the Prescription Drug Pricing Reduction Act of 2020, respectively).

“It remains to be seen how Democrats will use the newly approved Parliamentarian rule for reconciliation bills,” she commented. “It may allow the administration to break out pieces [out of the multitrillion dollar infrastructure bill].”

She also believes that moderate Senators Murokowski (R-AK) and Collins (R-ME) may support bills that allow Medicare to negotiate prices and for the importation of specific drugs. These bills were introduced in the previous Congress and are likely to see the light of day in 2021 as well.

On the regulatory side, Carrie Monks covered several fronts. She noted, for example, that the Trump administration had issued its final rule to eliminate safe harbor protections for Medicare Part D rebates. The Biden administration, however, froze the implementation date until Jan. 2, 2023.

“The Most Favored Nations model rollout was issued as an interim rule,” she said. “It would have applied to a limited number of drugs at first, but more drugs would have been added to it.” A preliminary injunction blocked the January 1, 2021 implementation, and the Biden administration announced that it will not move forward without additional rule-making.

Panelist Adam Colborn summarized AMCP’s state regulation priorities for 2021: (1) Promote meaningful transparency on drug pricing and patient cost sharing; (2) advocate for the development of clear metrics to shift pharmaceutical payments to value-based contracting; (3) encourage data sharing and interoperability of EHRs; and (4) promote AMCP’s position on formulary requirements, tier restrictions, and coverage mandates.

He also noted that pricing transparency bills have been introduced, but not yet enacted, in 37 states. In contrast, Mr. Colborn pointed out that there has not been a lot of legislation produced that addresses value-based contracting (only introduced in 10 states, none enacted). He counted 51 total bills across the states involving coverage mandates, tier restrictions, and formulary requirements. Mr. Colborn also said that a great deal of legislation has been introduced on utilization management tools, as well as other issues.

“Three bills in this category were enacted (in Kentucky, Utah, and Virginia), two involving insulin, and one requiring contraception access,” he noted.

Colborn A, Mathieu J, Monks C. Federal and State Legislative and Regulatory Update. Presentation L2.Presented at AMCP 2021; April 12-16, 2021.