| | | | |  | | By David Lim and Daniel Payne | | | With Megan R. Wilson, Robert King and Katherine Ellen Foley
| | |  Minnesota backed down on its plans to create a growth benchmark for health care costs after the Mayo Clinic protested. | Jim Mone/AP Photo | MAYO VS. MINNESOTA — Minnesota lawmakers learned this week just how hard it is to rein in health care spending. A proposal to create a health care cost growth benchmark and establish a board to enforce it was noticeably absent from the omnibus health care bill Minnesota lawmakers passed on Monday, the final day of their legislative session, POLITICO’s Megan Messerly reports. In its place: a significantly trimmed-down proposal requiring state health officials to review health care cost growth but giving them no authority to set targets. The reason? Mayo Clinic. Mayo’s pushback: The world-renowned health care system threatened earlier this month to pull $4 billion in planned investments in the state if Gov. Tim Walz and Democratic lawmakers didn’t kill the legislation and a separate nurse staffing proposal. “We don’t want to hurt our hospitals. We want them to thrive — especially Mayo Clinic, with their reputation of being an international health care provider. But we also care about working families and their ability to get health care,” former Minnesota state Rep. Jennifer Schultz, a Democrat who introduced the bill last year, told Megan. Mayo’s move represents the most overt health care industry attempt to push back on state efforts to control health spending, but the health system isn’t alone in resisting cost-containment efforts. Hospitals joined in — in a way: Hospitals have similarly, if more quietly, pushed back on proposals to give health care officials in Connecticut and Oregon more power to limit health care cost growth, while Massachusetts hospitals urge changes to the state’s more-than-a-decade-old benchmark. “People are so afraid to touch this because [hospitals] are the economic engines,” said Massachusetts state Sen. Cindy Friedman, a Democrat who chairs the legislature’s Joint Committee on Health Care Financing. “It’s a business, and people are making huge amounts of money. … That’s what you’re up against.” Hospitals say they remain supportive of the benchmarking process in the states where it’s been implemented. But they’ve expressed concerns about the extent to which states have the power to enforce cost growth targets and what, exactly, is included in them. Massachusetts Health and Hospital Association CEO Steve Walsh said in a statement that hospitals “remain strongly committed to a cost benchmarking tool” but “continue to advocate for a modernized approach to the benchmark that can fully account for the real-time pressures today’s patients and providers are experiencing.” Mayo, for its part, thanked Walz and lawmakers for working with them. IT'S WEDNESDAY. WELCOME BACK TO PULSE. Send "Succession" finale predictions, tips and feedback to dlim@politico.com! TODAY ON OUR PULSE CHECK PODCAST, host Ben Leonard talks with Megan Messerly about her report on Mayo Clinic's threat to withdraw $4 billion in new hospital investments in Minnesota if the state’s recent proposed health affordability bill wasn’t killed. Plus, the challenges states face in reining in health spending against influential industry players.
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The House E&C Committee is set to mark up legislation, including one bill sponsored by Chair Cathy McMorris Rodgers and ranking member Frank Pallone that would promote access to treatment and strengthen price transparency rules. | Francis Chung/POLITICO | TACKLING HEALTH, ENERGY BILLS — The House Energy and Commerce Committee will mark up 19 pieces of legislation today, many of which focus on increasing transparency and competition in the health care industry, Megan R. Wilson reports. The effort is part of a broader attempt by Congress to rein in health care costs, with several committees in the House and Senate taking a closer look at the role hospitals and pharmacy benefit managers, who manage prescription drugs benefits for health insurers, play in the system. Most of the health bills are bipartisan, including one from committee leaders, Chair Cathy McMorris Rodgers (R-Wash.) and ranking member Frank Pallone (D-N.J.), that would strengthen price transparency rules for hospitals and insurers and enact disclosure requirements for PBMs. However, there may be conflicts around legislation that would allow states to participate in value-based purchasing agreements for drugs, which link treatment cost to clinical benefit, and a proposal that would require hospitals to disclose information about how they use the 340B discount drug program. A must-pass user fee bill for animal drugs, which impacts medicines and treatments for livestock and domesticated pets, is also on the agenda. Outside of health care, the panel will consider bills aiming to expand broadband access and establish a notification system for cybersecurity threats to the electrical grid. Two GOP measures are related to gas stoves, including one that would stop the Energy Department’s proposal to set new efficiency standards. GRANGER POSTPONES MARKUPS — House Appropriations Chair Kay Granger announced the committee will postpone markups on four fiscal 2024 spending measures this week amid debt ceiling negotiations with the White House. “Given recent developments in the negotiations between Speaker [Kevin] McCarthy and the President, and in order to give the Speaker maximum flexibility as talks continue, the committee will postpone this week’s markups," the Texas Republican said in a statement sent shortly before midnight on Monday. The full committee was initially expected to mark up the Agriculture-FDA spending bill today, POLITICO’s Caitlin Emma reports.
| | | | GET READY FOR GLOBAL TECH DAY: Join POLITICO Live as we launch our first Global Tech Day alongside London Tech Week on Thursday, June 15. Register now for continuing updates and to be a part of this momentous and program-packed day! From the blockchain, to AI, and autonomous vehicles, technology is changing how power is exercised around the world, so who will write the rules? REGISTER HERE. | | | | | | | | CMS WANTS TO NAME AND SHAME — A new proposal unveiled on Tuesday by CMS would allow the agency to publicly identify the highest-cost drugs in Medicaid to give states additional negotiating leverage with drugmakers to push down prices, Robert reports. “Increasingly, the new high-cost drugs on the market, of which Medicaid pays a large amount, are specialty drugs with no competition,” said Dan Tsai, CMS’ top Medicaid official, on a call with reporters. The proposed rule — which would allow CMS to name three to 10 drugs that have either egregious launch prices, no competition or both — also would increase transparency of PBMs’ role in Medicaid. If finalized, the regulation would impose new requirements for transparent reporting of drug payments in contracts among PBMs, private insurers that run Medicaid managed care plans and states.
| | | | A message from PhRMA:   | | | | | GOOD NEWS AND BAD NEWS IN HIV FIGHT — HIV infections dropped 12 percent between 2017 and 2021, according to data from the Centers for Disease Control and Prevention released Tuesday, a rare bright spot amid rising and record rates of other sexually transmitted diseases. Young people — particularly gay and bisexual men — accounted for the bulk of the progress, with new infections dropping 34 percent among 13- to 24-year-olds, POLITICO’s Alice Miranda Ollstein reports. But there are still causes for concern: — Of the 1.2 million people in the U.S. in 2021 who had HIV, 1 in 8 were unaware of their status, and just 58 percent were taking adequate medication to suppress their viral load. — Progress was also uneven among racial groups: While white gay and bisexual men ages between 13 and 24 saw a 45 percent drop in infections, it was just 36 percent for Latinos and 27 percent for Black men. — Wide racial gaps exist when it comes to accessing HIV prevention medication, known as pre-exposure prophylaxis. In 2021, PrEP was prescribed to 78 percent of white people who could benefit from it versus 21 percent of Latinos and 11 percent of Black people.
| | | | DON’T MISS POLITICO’S HEALTH CARE SUMMIT: The Covid-19 pandemic helped spur innovation in health care, from the wide adoption of telemedicine, health apps and online pharmacies to mRNA vaccines. But what will the next health care innovations look like? Join POLITICO on Wednesday June 7 for our Health Care Summit to explore how tech and innovation are transforming care and the challenges ahead for access and delivery in the United States. REGISTER NOW. | | | | | | | | | OPIOID USE DISORDER TREATMENT APPROVED — The FDA approved Brixadi, an extended-release form of buprenorphine from Braeburn Inc., on Tuesday. Other forms of buprenorphine must be taken daily. Brixadi needs to be injected only weekly or monthly by a health care provider in a clinical setting, according to the FDA. “Today’s approval expands dosing options and provides people with opioid use disorder a greater opportunity to sustain long-term recovery,” FDA Commissioner Robert Califf said in a statement.
| | Vitor Rocha joined Cepheid as president. He previously was the CEO at Phillips North America.
| | Vivek Ramaswamy, the Republican presidential candidate who made a fortune in biotech, once was involved in a significant investment in a biotech company run by disgraced investor Martin Shkreli, POLITICO’s Daniel Lippman reports.
| | | | A message from PhRMA: Middlemen say they want lower prices, yet they often deny or limit coverage of lower-cost generics and biosimilars while giving preferential coverage to medicines with higher prices. This might be good for PBM’s bottom line, but it can lead to higher costs for patients. What else are they hiding? | | | | | | | Follow us on Twitter | | | | Follow us | | | | |
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