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The Health 202: White House is reviewing a new index to cut Medicare drug spending

with Paulina Firozi


Eight months ago, President Trump vowed to bring federal payments for some Medicare-covered drugs more in line with lower prices for the medicines in other countries. It was a move that struck many as especially aggressive for a GOP administration but meshed with Trump's vow to lower the price of prescription drugs.

A proposed rule for the experimental international pricing index is being reviewed by the White House Office of Management and Budget as of Thursday, indicating the Department of Health and Human Services is finally moving forward on it after some delay.

There’s enthusiasm inside HHS for the index, which would tie the prices for drugs covered by Medicare and distributed by doctors to an average of lower prices paid in 16 other countries, where the government plays a much more active role in setting prices. But the drug industry and some conservative groups are fighting hard against it, and Sen. Chuck Grassley (R-Iowa), head of the powerful Finance Committee, poured cold water on the proposal after holding his fire for months.

“I'm gaining a view that I don't think that this administration's approach on international pricing is going to be to the benefit of the adoption of and research for modern drugs,” Grassley told reporters on Wednesday. “I've been slow arriving at that conclusion ... but I think I've studied it long enough now.”

Trump visited HHS at the end of October to unveil the index idea, saying it would resolve a “rigged” system in which the United States pays more than other nations for medicines. The idea is to save the government money by reducing payments for prescription drugs dispensed through the part of Medicare that pays for doctor visits.

While the index would apply to just a small percentage of the drugs paid for by Medicaid, it is one of the more robust actions the administration has proposed against skyrocketing drug prices. Last month, HHS finalized a rule requiring drugmakers to display the list price of medications in television ads. The agency is also working to finalize a rule essentially banning the rebates drugmakers pay to pharmacy middlemen, which are blamed for inflating list prices.

But the index proposal has particularly raised the ire of conservatives, who view it as akin to government price-setting. FreedomWorks has been especially vocal against the idea, dubbing it an “importation of foreign price controls.”

It's encouraging to see Senator Grassley come out to oppose the international pricing index,” said Dan Savickas, the group’s federal affairs manager. “No conservatives should entertain this idea and we need more legislators to come forward and publicly urge the administration to end their push for IPI.”

Pharmaceutical makers, which last year spent the most they had on lobbying since 2009, when the Affordable Care Act was being passed, are fighting hard, too. The index would result in delays for patients seeking medications, especially for cancer patients, the Pharmaceutical Research and Manufacturers of America wrote in a blog post earlier this month.

“It’s clear this far-reaching proposal would take the Part B program in the wrong direction,” wrote PhRMA's Nicole Longo, director of public affairs. “We urge HHS to abandon the proposed demonstration and instead pursue reforms grounded in market competition and patient-centered care.”

The White House Office of Management and Budget noted the potential rule in its spring list of regulations that are in the works at HHS. The agency could provide more details in the regulatory agenda it is expected to release this summer.

NOTE: This story has been updated to reflect breaking news.


AHH: A federal appeals court ruled yesterday that the Trump administration’s ban on abortion providers from getting federal family planning dollars could go into effect, dealing a major blow to Planned Parenthood as well as 21 state attorneys general who have filed lawsuits over the policy.

The administration says the rule -- which could slash as much as $60 million in Title X funds from the women’s health-care and abortion provider -- would ensure taxpayer dollars aren't going to clinics that provide abortions or refer for them, our Post colleague Ariana Eunjung Cha reports.

The rule can now take effect amid numerous lawsuits against it. The panel of three judges “wrote that the government is likely to prevail with its argument that the lower courts erred in concluding the rule likely violated the Administrative Procedure Act,” Ariana writes. “They noted the U.S. Supreme Court upheld a similar HHS regulation in its 1991 Rust v. Sullivan decision that prohibited federally funded clinics from counseling about abortion, which ‘largely foreclosed any attempt to argue that the Final Rule was not a reasonable interpretation’ of what Congress intended when it established the Title X program.”

HHS Secretary Alex Azar called the decision “a major step toward the Trump administration being able to ensure that all Title X projects . . . do not support abortion as a method of family planning.”

Planned Parenthood president Leana Wen called the ruling “devastating.” “Planned Parenthood will not let the government censor our doctors and nurses from informing patients where and how they can access health care,” she said.

OOF: There’s an ongoing debate in the state of Oklahoma over how the money in opioid lawsuit settlements should be doled out.

The fight began after the state settled a landmark lawsuit against opioid maker Purdue Pharma in March — after the $270 million deal, none went to the state; $200 million went to a new addiction treatment and research center at Oklahoma State University; $12.5 million was to be divided up among 670 cities and counties; and $60 million went to paying private attorneys, our Post colleague Lenny Bernstein reports.

Then, days before another $85 million settlement was announced with Teva Pharmaceutical, state lawmakers and the governor enacted a law to require that all settlement money go to the stte treasury. They went to court last week to make sure that happens.

Now, all eyes are on the ongoing case with the Johnson & Johnson, the last remaining defendant.

“A trial in that case is in its fourth week in Judge Thad Balkman’s courtroom in Norman, Okla. If it results in a settlement or a verdict for the state, all sides will want a piece of a possibly enormous payment and some voice in how the money is spent on the drug crisis,” Lenny writes. “In the meantime, the conflict over how to spend the money already available is providing a sideshow to the main event.”

OUCH: Health officials are scrambling to reset their strategy in responding to the nearly year-long Ebola outbreak in Congo. And now that the virus is spreading, nearby countries are attempting to contain it, our Post colleague Max Bearak reports.

“Ebola is like water. If you don’t build a perfect dam, even a small hole can lead to a flood of new cases,” Marie Roseline Belizaire, the World Health Organization’s deputy manager for the response, told Max.

“Health officials are confident the outbreak is not spiraling out of control but are worried the holes in that dam are opening up faster than they can plug them,” he writes. “Along the four international borders near the outbreak zone, hundreds of thousands of people move unimpeded from country to country each day using countless footpaths that save them the hassle of immigration authorities and, now, health checkpoints.”

Health workers are now also worried about Ebola spreading to the Congolese city of Goma, “a provincial capital of more than 1 million people where as many as 70,000 people cross the border with Rwanda every day.”

WHO officials caution it could still take at least three months to fully eliminate the virus in the best-case scenario.


— President Trump is reportedly planning an executive order next week to direct federal agencies to require that insurance companies, doctors, hospitals and others in the industry disclose their prices, the Wall Street Journal’s Stephanie Armour reports.

Backers of such a plan say it will create more transparency by requiring such industry members to provide information around health-care costs that are often negotiated behind closed doors.

“The executive order has the support of a number of doctors who on Thursday urged the administration to push ahead on disclosure of prices,” Stephanie writes. But she notes some, including hospitals and insurers, have pushed back on such an effort, warning “it could cause costs to climb if some businesses learn competitors are getting bigger discounts. They also say consumers really want to know their own out-of-pocket costs and won’t benefit from full disclosure of negotiated prices.”


— Not one of the six pharmaceutical executives invited by the Congressional Progressive Caucus to testify before the group on Capitol Hill showed up to do so. But that may have largely been the point.

Stat’s Lev Facher writes the “sham hearing nonetheless provided dual opportunities for the Congressional Progressive Caucus: to poke fun at a favorite target in ‘Big Pharma’ and to further criticize Democratic leadership for what progressives say has been a lackluster effort to lower prescription drugs.” During the hearing, Rep. Pramila Jayapal (D-Wash.), a co-chair of the group, detailed her criticisms of Mylan, Merck, Gilead, Eli Lilly and Pfizer. These companies’ executives probably didn’t consider the group's invitations, which were doled out with a week’s notice, Lev writes, in part because it has "little power to compel the industry figures’ presence here."

“Pharmaceutical executives or not, the trumped-up hearing’s intention was clear: to signal to House Speaker Nancy Pelosi that while some on the Democratic Party’s left flank are pleased with recent modifications to long-awaited drug pricing legislation, other members won’t be so easily satisfied,” he adds. “In fact, the lawmakers quickly shifted their focus away from the companies and the unpopular price hikes they’ve enacted. They turned instead to Democratic leadership and its approach to formulating prescription drug legislation.”


— Planned Parenthood of St. Louis says it will no longer obey the state requirement that doctors perform two pelvic exams on women who want to get a surgical abortion -- one OB-GYN at the clinic called the required exams “deeply traumatizing and inhumane,” USA Today’s Nicquel Terry Ellis reports.

"We believe continuing to force an additional invasive and uncomfortable vaginal exam on patients at least three days before her abortion procedure, when it is not medically indicated, and when she will have the identical exam on the day of the abortion procedure, is not patient-centered; it is disrespectful and dehumanizing," the OB-GYN Colleen McNicholas said.

Earlier this month, a judge ruled the St. Louis clinic could continue performing abortions at least until today as it fights the state’s health department, which has said it is investigating potential health code violations.

“Planned Parenthood and state attorneys are set to appear in court Friday for a status conference on a license renewal,” Nicquel writes. “If Planned Parenthood loses its court challenge, Missouri would become the first state without an abortion provider.”  

— And here are a few more good reads: 

Democrat, Trump nominee have fiery exchange over abortion rights for rape victims (The Hill )


While addiction crisis raged, many surgeons overprescribed opioids (Kaiser Health News)

FDA, accused of being too lax in approval of opioids, outlines new criteria (Stat)


Major study suggests Medicaid work requirements are hurting people without really helping anybody (Vox)

AP Interview: Border official says aid needed to save lives (Associated Press)


Hundreds likely to weigh in on California vaccine measure (Associated Press)


E-Cigarette Exploded in a Teenager’s Mouth, Damaging His Jaw (New York TImes)

NRA sidelines its top lobbyist, Chris Cox, in latest sign of internal turmoil (Katie Zezima and Beth Reinhard)


Horns are growing on young people’s skulls. Phone use is to blame, research suggests. (Isaac Stanley-Becker)

Children battling cancer can’t always express their feelings. Now a robotic duck is doing it for them. (Peter Holley)


Coming Up

  • The House Energy and Commerce Subcommittee on Health holds a hearing on “Reauthorizing Vital Health Programs for American Families” on June 25.
  • The House Veterans Affairs Subcommittee on Oversight and Investigations holds a hearing on “Learning from Whistleblowers at the Department of Veterans Affairs” on June 25.

Roy Moore responded to questions about sexual misconduct allegations as he announced he would run again for the Alabama Senate seat: 

Roy Moore, who lost to Democrat Doug Jones in the 2017 Alabama Senate race, responded to questions about the allegations during his announcement June 20. (Video: Reuters)