The House on Friday voted 228–208 to pass the $1 trillion bipartisan physical infrastructure bill (H.R. 3684), which will fund highways, railways, water infrastructure, power infrastructure, and broadband. President Joe Biden is expected to sign the bill this week.
Congressional leaders called for the vote after agreeing on the path forward for the Build Back Better Act, the $1.75 trillion “human infrastructure” bill. A group of moderate Democrats did not want to vote on the Build Back Better Act until they received an official score from the Congressional Budget Office (CBO) showing the legislation would not add to the federal debt. Progressives, however, wanted to vote on both bills at the same time. To assuage both sides, lawmakers agreed to vote on the physical infrastructure measure while taking a procedural vote to set future consideration of the human infrastructure bill following the release of a final CBO score.
‘Human Infrastructure’ Bill Changes
Meanwhile, lawmakers last week announced an agreement on policies in the Build Back Better Act to lower prescription drug prices, a key priority omitted from Biden’s initial framework due to lack of support. Under the proposal, Medicare beginning in 2025 would negotiate prices for up to 10 high-cost drugs that passed their exclusivity window, as well as insulin; that number would increase to 20 drugs in 2028. The bill would make certain drugs ineligible for negotiations, including vaccines and those made by small biotech firms, among others. The bill includes taxes on manufacturers to ensure compliance.
Additionally, the new drug pricing language includes rebates beginning in 2023 for Medicare Part B and Part D drugs whose prices rise faster than inflation, with 2021 serving as the base year for comparison. It also redesigns the Medicare Part D benefit for seniors, capping out-of-pocket costs. It would repeal the Trump-era pharmacy benefit manager (PBM) rebate rule and includes new PBM oversight requirements.
Other updates of note for essential hospitals would:
- increase by 3 percentage points the Federal Medical Assistance Percentage (FMAP) from 2023 through 2025 in states that expanded Medicaid;
- provide Medicaid coverage for beneficiaries up to 12 months postpartum;
- provide 12 months continuous Medicaid eligibility for children;
- gradually reduce the 6.2 percentage point FMAP increase in the Families First Coronavirus Response Act until it is eliminated after September 2022;
- set new eligibility redetermination standards for states to maintain the FMAP increase through fiscal year 2022;
- require a regular survey of retail community pharmacy drug prices to help determine the national drug acquisition cost, penalizing states that don’t require pharmacy participation in the survey by withholding matching reimbursement;
- allow inmates of a public institution to enroll in Medicaid coverage 30 days before returning to the community, effective two years after the bill becomes law;
- impose an FMAP penalty on states that reduce Medicaid eligibility from current standards through 2025;
- permanently reauthorize the Children’s Health Insurance Program, adding drug rebates for covered outpatient drugs;
- close the Medicaid coverage gap in the 12 non-expansion states by enrolling eligible individuals into no-cost premium plans on the Affordable Care Act (ACA) marketplaces;
- provide additional premium and cost-sharing support for individuals who access their insurance through ACA marketplaces; and
- invest in programs to improve maternal health outcomes and eliminate disparities in maternal health, including by addressing social determinants of health.
The legislation would take important steps to strengthen, diversify, and expand the health care workforce. The bill includes two programs supported by America’s Essential Hospitals:
- Health Profession Opportunity Grants, which provide funding to expand the allied health workforce; and
- the rural and underserved Pathway to Practice Program, which provides scholarships, stipends, and vouchers to incentivize individuals from rural and underserved communities to become physicians who then train and practice in those same communities.
The bill also would provide an additional 4,000 graduate medical education (GME) slots, with a minimum number of slots for primary care and psychiatry. Also related to workforce development, the bill would provide:
- an additional $200 million for the children’s hospital GME program;
- an aggregate of $2 billion for medical and nursing schools for recruitment, enrollment, and retention of new students, with priority given to underrepresented populations;
- $2 billion for the National Health Service Corps and $500 million for the Nursing Corps; and
- an additional $50 million to support substance use disorder professionals.
Damaging DSH Cuts Remain in Bill
Unfortunately, the updated bill retained a harmful proposal to cut Medicaid disproportionate share hospital (DSH) and uncompensated care pool payments to states that did not expand Medicaid as envisioned under the ACA.
The bill would cut DSH payments to these states by 12.5 percent of their anticipated allotment beginning in fiscal year 2023. If a state chooses to expand Medicaid after 2023, their full DSH allotment would be restored for the year they expand. If, however, an expansion state chooses to roll back their expansion, they would receive a 12.5 percent cut for that fiscal year, prorated based on the number of days for which expanded coverage is available. These states’ share of the ACA DSH cuts currently scheduled to go into effect in 2024 would be taken on top of that 12.5 percent cut.
Additionally, for Medicaid non-expansion states with uncompensated care pool waivers, the provision would remove the costs of care for patients who would otherwise be eligible for Medicaid if the state expanded the program.
Restricting critical funds to hospitals providing care and services to marginalized populations in low-income communities would harm not only those hospitals but also the very populations expanded coverage is intended to help. America’s Essential Hospitals also is concerned that, in addition to the direct financial harm DSH cuts pose to essential hospitals, federal actions to punish states for not engaging in an optional program design sets a troubling precedent.
America’s Essential Hospitals supports closing the coverage gap and continues to urge lawmakers to remove these damaging cuts from efforts to expand coverage.
The House and Senate are in recess; both chambers will return Nov. 15. Upon their return, House lawmakers plan to vote on the Build Back Better Act, sending it to the Senate for further debate.
Apply Today for the Government Relations Academy
America’s Essential Hospitals is accepting applications for the 2022 Government Relations Academy, a nine-month educational program for government relations professionals. Participants will elevate their federal advocacy skills with a focus on institutions serving low-income patients and others who face barriers to care. Apply today!