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On the Hill: Funding Bill Would Extend DSH Cut Delay

Congressional leaders have released a comprehensive legislative package that would fund federal operations for the remainder of fiscal year (FY) 2020, which started Oct. 1, and delay for five months a $4 billion cut to Medicaid disproportionate share hospital (DSH) payments.

The House on Tuesday advanced the legislation, and Senate lawmakers this week are expected to follow suit before current funding expires on Dec. 20. In a release, America’s Essential Hospitals thanked lawmakers for protecting health care access through the short-term delay of DSH cuts but emphasized the need for longer-term relief.

One bill in the legislative package (H.R. 1865) would fund the departments of Health and Human Services, Labor, and Housing and Urban Development, among others. It also would extend funding through May 22, 2020, for Medicaid DSH payments, further delaying the $4 billion cut scheduled to start Oct. 1. Other funding extensions in the bill include those for:

  • community health centers;
  • the community mental health services demonstration program;
  • the National Health Service Corps;
  • the Teaching Health Centers Graduate Medical Education Program;
  • Medicaid spousal impoverishment protections; and
  • the Medicaid “Money Follows the Person” demonstration program;

H.R. 1865 also would reauthorize and fund the Patient-Centered Outcomes Research Institute (PCORI) for 10 years, through FY 2029, and permanently repeal three major health care taxes under the Affordable Care Act: the “Cadillac” tax on high-value health plans and the medical device tax, effective Dec. 31, 2019, and the health insurance tax, effective Dec. 31, 2020.

A second bill in the package (H.R. 1158) would fund the departments of Defense, Justice, and Homeland Security, among others.

The spending package does not include proposals to reduce surprise medical bills or prescription drug prices. America’s Essential Hospitals will summarize key provisions of the spending bills in a forthcoming Action Update.

House Passes Drug Pricing Bill

Meanwhile, the House last week passed the Lower Drug Costs Act of 2019 (H.R. 3), a bill championed by Speaker Nancy Pelosi (D-CA) that aims to lower the cost of prescription drugs. The bill proposes to cap out-of-pocket spending for Medicare Part D beneficiaries and establish a Medicare rebate penalty for drug manufacturers that hike the price of a prescription drug above inflation. Notably, the bill would allow Medicare to negotiate the price it pays for up to 250 of the costliest drugs without a generic or biosimilar alternative.

The Republican-controlled Senate is not expected to consider H.R. 3, as currently written.

Senate Hearing on Opioid Use Disorder

The Senate Judiciary Committee will hold a Dec. 17 hearing to examine government efforts to tackle opioid use disorder.

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About the Author

Erin Delaney is the legislative affairs associate at America's Essential Hospitals.

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