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October 24, 2024 – The election is approaching fast, and no matter who wins, there will be a change in administration come January 20, 2025. Thus, the Biden Administration is in the midst of making its final mark on priority healthcare policies. As we approach this final countdown, let’s take a look at how the Biden Administration’s final regulatory actions compare to former President Trump’s as his first administration came to an end. Are these concluding moves indicative of what we could see in a Harris Administration or a second Trump Administration? To help provide some perspective on this important question, I’m bringing in my colleague, Leigh Feldman.
As discussed in last week’s Regs & Eggs blog post, the Biden Administration has a bunch of regs queued up for release by the end of 2024 or early 2025. Looking at this list, key themes include:
Each week that remains in the Biden Administration, that list of priorities and regs will slowly be whittled down. Earlier this week, for example, the Biden Administration released a proposed reg that would require certain private health plans to cover recommended over-the-counter contraceptive items without cost sharing or a prescription. Next week, the Centers for Medicare & Medicaid Services (CMS) will release the 2025 calendar year Medicare final regs, and in the outpatient prospective payment system final reg, CMS may finalize new obstetric care conditions of participation for hospitals that the agency believes will help improve maternal health outcomes.
Let’s now compare this regulatory agenda with former President Trump’s in the final days of his first administration. In September 2020, two months before the 2020 election, former President Trump announced his America First Health Plan, which included an executive order that attempted to lay out his administration’s health care priorities and vision going forward.
The executive order highlighted many of the initiatives that the Trump Administration promoted over the course of its four-year term, including:
Subsequently, in the Trump Administration’s last few weeks, CMS, under the leadership of former Administrator Seema Verma, issued numerous final regulations:
In its final days, CMS under the former Trump Administration also approved multiple Medicaid demonstration waivers, some of which represented a significant shift away from how Medicaid traditionally operates. For example, on January 8, 2021, CMS approved a waiver from Tennessee to test a block-grant approach for its state Medicaid program. The TennCare III demonstration took advantage of flexibilities that CMS provided in its Healthy Adult Opportunity Initiative. Outgoing CMS Administrator Verma also wrote a letter to state Medicaid directors asking them to lock in these Medicaid changes as soon as possible.
Looking at these final actions, there seem to be clear differences in priorities between the Trump and Biden Administrations, but in a few cases some goals overlap (albeit with different policy preferences for achieving them).
Even though both administrations released, or will release, some of the same final annual regs, the regs’ content and policies are (or will be) different. Take the final ACA NBPP regs as an example. In the 2022 NBPP, the former Trump Administration focused on creating more flexibility in both the design of the Marketplaces and the coverage options from which consumers could choose, including the ability to purchase short-term limited duration insurance. The Biden Administration’s proposed ACA NBPP for 2026, released a couple of weeks ago, took a different approach. It focuses on strengthening enforcement efforts, preserving the “integrity of the Federally Facilitated Marketplace,” and cracking down on potentially misleading practices that CMS argues confuse consumers. Same regulatory vehicle, but extremely different policies!
Both administrations also shared certain goals, including reducing the cost of prescription drugs. However, their proposed solutions to this perennial issue have been entirely different. In September 2020, former President Trump issued an executive order aimed at controlling drug prices in Medicare Parts B and D. The executive order established an administrative policy objective that the Medicare program should not pay more for costly Part B or Part D prescription drugs or biological products than the “most-favored-nation price.” The most-favored-nation price was defined as the “lowest price, after adjusting for volume and differences in national gross domestic product, for a pharmaceutical product that the drug manufacturer sells in a member country of the Organisation for Economic Co-operation and Development (OECD) that has a comparable per-capita gross domestic product.” In other words, Medicare drug prices would be set at the lowest price for which manufacturers sell the drug in certain foreign countries. In October 2020, the former president announced that 33 million Medicare beneficiaries would soon receive a $200 “drug discount card” to help them afford prescription drugs. The former president stated that Medicare would use savings from the “most-favored nation” drug pricing model to help pay for this expense. Neither the most-favored nation model nor the $200 drug discount card policy was ever implemented.
Conversely, the Biden Administration has focused primarily on implementation of the IRA to lower drug prices. CMS recently announced prices for the first 10 drugs selected for negotiation under the Medicare Drug Price Negotiation Program beginning in 2026 and established negotiation parameters for the second round of drugs in 2027. In July 2024, CMS announced a Premium Stabilization Demonstration for standalone Part D plans, which the Biden Administration framed as stabilizing year-over-year changes in premiums as a result of the IRA. Several weeks ago, CMS released a request for information on a proposed Medicare $2 Drug List Model that could start as early as January 2027 and would standardize cost-sharing for low-cost generics at $2 for a month’s supply.
So, as we asked at the beginning: are these final regulatory actions indicative of what we could see in a Harris Administration or a second Trump Administration?
Under a Harris presidency, there likely would be a continued focus on expanding access to reproductive care, addressing healthcare disparities, improving maternal health outcomes, shoring up the ACA marketplaces to protect consumers, and lowering the cost of prescription drugs through the IRA.
Under a second Trump term, we’d expect policies promoting alternative coverage options in the ACA Exchange and creating more flexibility for states and the private market to cover their populations. We’d also anticipate efforts to lower drug prices, although the Trump campaign has said that it would not revive the most-favored nation model.
Depending on who the Secretary of Health and Human Services and the CMS Administrator are under a Harris or Trump Administration, we could also see new ideas on how to tackle some of these issues. In other words, personnel is policy, and the incoming administration’s direction will likely depend on how the people in charge of the main federal agencies seek to put their own stamp on the administration’s healthcare priorities.
Until next week, this is Jeffrey (and Leigh) saying, enjoy reading regs with your eggs.
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