HHS readying new rule to expand 'conscience' protections Presented by

Congress continues to wrestle with how to fund the government, and Alex Azar gets ready for a key vote. But first: POLITICO scoops a looming regulatory move that's been long sought by religious groups.

HHS IS PREPPING NEW 'CONSCIENCE' PROTECTIONS FOR WORKERS — The agency is readying a rule that would shield workers who don't want to provide abortions, care for transgender patients or perform other procedures because of moral or religious objections, your PULSE author and Jennifer Haberkorn scooped last night.

— What's involved: The pending rule, which could be released as soon as this week, has been described to POLITICO as establishing a new “division” of the HHS civil rights office that would conduct compliance reviews, audits and other enforcement actions to ensure that health care providers are allowing workers with religious or moral objections to opt out.

The office would also conduct outreach and technical support to help others who are seeking to strengthen protections for these workers.

— Who's involved: The rule would empower Roger Severino, the HHS civil rights chief with a long record of advocating for religious groups and arguing against LGBT protections. He's also been a strong critic of providing procedures to transgender patients seeking to transition.

HHS didn't respond to multiple requests for comment.

— How patient advocates are responding. Representatives of LGBT and abortion-rights groups say they strongly oppose HHS' planned move. "Any rule that grants a license to discriminate would be a disgrace and a mockery of the principal of religious freedom we all cherish," said Harper Jean Tobin of the National Center for Transgender Equality.

The ACLU immediately blasted the report and warned HHS could face legal challenges. "Should the administration choose to move forward to implement a discriminatory policy, we will see them in court," the ACLU's Louise Melling said in a statement.

Keep reading: More.





The Trump administration is readying a rule to protect health workers who oppose abortion and other procedures because of moral or religious objections. | AP Photo

MEANWHILE: THE LATEST ON THE GOVERNMENT FUNDING FIGHT — House Republicans on Tuesday night appeared to coalesce around a short-term funding bill to avert a government shutdown Friday, even as a bitter fight continued over the fate of more than 700,000 young undocumented immigrants known as DREAMers.

— Key tactic: Target the ACA. House Speaker Paul Ryan's bill includes a delay of several Obamacare taxes and a six-year extension of a popular healthcare program for children. And that strategy — combined with Minority Leader Nancy Pelosi’s threats to withhold Democrat votes to help pass the measure — appeared to have won over key GOP skeptics.

“It’s a good strategic position because not only does it offer CHIP [funding] for six years… but you also have a medical device tax delay as well as the Cadillac tax delay,” said Republican Study Committee Chairman Mark Walker (R-N.C.), referring to some of the taxes that would be suspended. “I think it puts Democrats in a very difficult position of having to vote against that in the House or in the Senate.”

— The plan: House GOP leaders will whip the bill Wednesday before a possible Thursday vote. If the funding measure passes the House, senior Republican sources in both chambers expect the measure to clear the Senate.

However, House Freedom Caucus Chairman Mark Meadows (R-N.C.) said many of his conservative members oppose the plan, dismissing the tax delays as a “gimmick” that won’t necessarily help leaders find 218 votes for passage. "Based on the number of 'no' and undecided votes, there is not enough votes for a Republican-only bill," he said.

Defense hawks also aren't thrilled, saying that the strategy to continually opt for short-term patches harms funding for military priorities.

Keep reading: More.

— Federal budgeting is so broken only earmarks might fix it. Lawmakers' failure to accomplish the most basic function of funding the government is now spurring talk of “fixing” the budget process and reviving pork-barrel spending outlawed when the GOP took control of Congress, POLITICO's Sarah Ferris and Jennifer Scholtes report. More.

COMMITTEE VOTE ON ALEX AZAR LOOMING TODAY — The Senate Finance Committee is scheduled to review Azar's nomination as part of a 10 a.m. executive session.

— The whip count seems favorable for Azar. The former pharmaceutical executive hasn't inspired the animus that former HHS Sec. Tom Price faced in his confirmation hearings last year, with several Democratic senators saying that they could be open to supporting Azar.

— What could come next: While a full Senate floor vote hasn't yet been scheduled, sources close to the process tell POLITICO's Adam Cancryn that the goal is to confirm Azar by the end of the month — assuming the committee moves his nomination forward, as expected.

WELCOME TO WEDNESDAY PULSE — Where we know it's a meaty issue of PULSE, so we'll let you get to it. Quick tips to [email protected] or @ddiamond on Twitter.

With help from Rachana Pradhan (@RachanaDixit), Paul Demko (@PaulDemko), Sarah Karlin-Smith (@SarahKarlin), Victoria Colliver (@vcolliver), Adam Cancryn (@AdamCancryn), Luis Sanchez (@_luissanchez1), Brianna Ehley (@briannaehley), David Pittman (@David_Pittman) and Jennifer Haberkorn (@JenHab).

A message from PhRMA: Today, there are several promising vaccine candidates in stage three clinical trials. These trials have tens of thousands of participants, from every walk of life. From development to robust clinical trials, and throughout manufacturing, these vaccine candidates follow the same rigorous process of other vaccines that have saved millions of lives. More.

MATT BEVIN PLAYING HARDBALL OVER MEDICAID IN KENTUCKY — The Republican governor issued an executive order that could jeopardize coverage for nearly 500,000 people who obtained benefits under Obamacare, POLITICO's Rachana Pradhan reports.

— What's in the executive order: It threatens to end the program if any part of the state's newly approved Medicaid waiver — which the Trump administration signed off on last week — is blocked as a result of litigation. Advocacy groups are widely expected to sue to stop the plan's work requirement, the first in the nation to mandate certain low-income adults must work or participate in a related activity for 80 hours per month to retain their Medicaid coverage.

— How patient advocates are pushing back: They say Bevin's executive order changes nothing about the likelihood of a lawsuit. "The fact that the governor is issuing an executive order to address what happens when his waivers are rejected by a court of law speaks volumes to his belief about the underlying legality of the waivers," said the National Health Law Program's Leonardo Cuello.





FIRST IN PULSE: Cassidy introduces 340B transparency bill. Hospitals would be required to report revenues derived from drugs bought under the 340B drug discount program and demographics on patients who receive such drugs under a bill being introduced by Louisiana Sen. Bill Cassidy today.

His legislation, the HELP ACT, would also place a two-year moratorium on new participants in the 340B program, which has been criticized for the way hospitals can take advantage of the discounts drugmakers must offer low income-serving hospitals in the program. “Too often the program’s discounts are used to pad hospitals’ bottom lines instead of helping disadvantaged patients afford their treatments,” Cassidy plans to say in a release.

— Background: A House bill H.R. 4710 (115) introduced last month by Rep. Larry Bucshon (R-Ind.) would also place a hold on new 340B sites while increasing transparency. Last week, the Energy and Commerce Committee released a report offering 12 recommendations for the program, including more oversight from HRSA and greater clarity from Congress on the program’s intent.

MACRA changes on the table this week. Should Congress include Medicare extenders in a CR this week, lawmakers might tweak the 2015 law H.R. 2 (114) that sought to overhaul the way Medicare pays doctors. There are a few changes under consideration, including reversing CMS’s decision to count Medicare spending as 10 percent of doctor’s annual score under MACRA’s Merit-based Incentive Payment System.

Also under discussion: whether to empower the HHS secretary to rebase MIPS benchmarks so they're not linked to the expected average or median physician score. The moves would delight doctors who pushed Congress for the changes last year.





Johnson & Johnson won't consider patients' right-to-try requests. It's one of the strongest condemnations of such measures from industry to date, POLITICO's Sarah Karlin-Smith reports.

In a policy statement, J&J's pharmaceutical division Janssen said it will not evaluate right-to-try requests because these laws don't allow for FDA input, which is "critical for ensuring patient safety." The company's position is contained in its policy for how it evaluates and responds to requests for access to investigation medicines.

Thirty-eight states have passed right-to-try laws allowing terminally ill patients to skirt FDA's compassionate use process and go directly to a company when seeking access to experimental medicines outside of clinical trials. The Senate passed a national right-to-try bill this summer and the House could vote on their version this month with the support of the Trump administration. More for Pros.

Anthem's payment changes spark blowback. Specialty docs and disease advocacy groups are raising alarms about controversial changes to the insurer's payment policies for lucrative advance imaging services.

Last year, the country’s largest Blue Cross Blue Shield plan began cutting off payments for many patients who get MRI or CT scans at hospital-owned outpatient facilities, a change that will result in major revenue losses for many hospitals. In a letter to Anthem’s chief clinical officer, 11 national groups – including the American College of Emergency Physicians and the American College of Surgeons — argue that Anthem implemented the changes largely without input from providers and that it’s ignoring evidence of likely harm.

“Failure to rescind these policies could jeopardize patient care and, furthermore, these new policies could serve to undermine a relationship between Anthem and a broad array of the physicians who treat your beneficiaries,” reads the letter.

Rural America could use fewer hospitals. That's according to a new report from the Bipartisan Policy Center, which concludes that rural communities might benefit if their critical access hospital is transformed into a small inpatient care center or rural ER.

Rather than supporting small, rural hospitals in every community, policymakers need to tailor services to the needs of their towns, BPC concludes after working with the Center for Outcomes Research and Education to study seven upper Midwestern states.

The recommendation is likely to upset rural health advocates working to prevent rural hospitals from closing. See the report.





Senate HELP Committee examines looming public health threats. This morning's hearing will examine whether the nation's health care agencies are prepared and adequately resourced to combat biomedical threats.

"It is critical that fostering and advancing innovation, particularly in the development of medical countermeasures, is top of mind," Sen. Richard Burr plans to say in his opening remarks, an excerpt of which were shared with PULSE. Burr, who's chairing the hearing, also will raise the question of whether CDC, FDA, and ASPR/BARDA are sufficiently funded.

— On tap to testify: FDA commissioner Scott Gottlieb, HHS' Robert Kadlec and CDC's Stephen Redd.

— Who isn't testifying: CDC chief Brenda Fitzgerald. The hearing was to be Fitzgerald’s first public testimony before Congress since her appointment in July. But it marks the second time Fitzgerald has had to back out of a hearing after her attendance was announced because of a lingering conflict with her ethics disclosures, POLITICO's Jennifer Haberkorn scooped yesterday.

"I’m frustrated Director Fitzgerald is once again unable to join us," ranking member Sen. Patty Murray is prepared to say in her opening remarks. "I’m concerned that she still cannot give her full attention to all the pressing health threats we face and hope these conflicts of interest will be resolved soon."

Kaiser Family Foundation digs into disconnect between the elderly’s needs, care. Most people have not planned what to do if they become seriously ill, according to a foundation study that surveyed more than the more than 2,000 adults.

Among the findings:

— Just one-third of respondents said they’ve discussed with their family how to pay for serious illnesses when they are older.

— Most respondents said they haven’t discussed the kind of care they would want or who would make medical decisions on their behalf if they are unable to do so.

— Most people said they don’t have a document that details their wishes.

Meanwhile, about four in ten adults with a serious illness said they need help more often than they are getting. About a quarter said they have difficulty getting the help they need and about 20 percent said they forgo the help they need because of cost.





House Ways & Means looks closer at opioid crisis. An Oversight Committee hearing this morning — the first chaired by Rep. Lynn Jenkins (R-Kan.) — will examine the role that CMS plays in the crisis, such as how it pays for opioids for Medicare beneficiaries and how it identifies and prevents opioid misuse. Watch the 10 a.m. hearing.

Senators to introduce bipartisan bill to expand medication-assisted therapies. The Addiction Treatment Access Improvement Act — backed by Democratic Sens. Ed Markey and Maggie Hassan and GOP Sens. Susan Collins and Rand Paul — would allow further flexibility for physicians seeking to use medication-assisted therapies such as buprenorphine. See the legislation.





Murray raises questions about HHS' commitment to evidence-based practice. The ranking member of the Senate HELP committee tells acting HHS Secretary Eric Hargan that she's worried about decisions to pull funding from a program to reduce teen pregnancy and other initiatives.

"I write with serious concern about the numerous instances in which [HHS] has rolled back or undermined evidence-based practices and policies under the Trump Administration," Sen. Patty Murray writes in a letter today. Read the letter.

OIG: Errors in Medicare Advantage billing data are widespread, but most are fixable. More than one in four encounter records for Medicare Advantage beneficiaries had at least one potential error, according to a new report by HHS’ Office of Inspector General. But the agency was able to easily fix most of the mistakes, leaving just five percent of billing records with potential errors. Read the report.





States ask Supreme Court to reject California’s pregnancy center law – Texas Attorney General Ken Paxton filed a brief Tuesday in the U.S. Supreme Court challenging a California law that requires licensed clinics, including faith-based crisis pregnancy centers, to post information about low-cost abortion and contraception services. The Supreme Court in November agreed to hear a free-speech challenge over California’s 2015 law, known as the Reproductive FACT ACT.

In the brief, which is joined by 22 other states, Paxton asks the Supreme Court to overturn a 2016 ruling by the 9th U.S. Circuit Court of Appeals that upheld California’s law. “States have a host of alternative means available to disseminate the information that the California law requires certain licensed medical facilities to provide, as well as the regulatory authority to address any actual instances of misrepresentation," Paxton wrote. Read the brief.

California: State continues universal health care hearings. Today, a state Assembly committee formed to explore universal health care options in the Golden State will hold the third of a series of hearings on the issue, this one focusing on access to care and understanding health care pricing. Speakers will include the Kaiser Family Foundation’s Larry Levitt, Chris Perrone from California Health Care Foundation and Laurence Baker, professor of health research and policy at Stanford.

As with the past hearings, members of the California Nurses Association and other single-payer supporters will rally outside the state Capitol where the meeting will be held. They’re upset over Senate Bill 562, the state single-payer legislation that got stalled in an Assembly committee last year, and want the bill to advance.





CVS Health adds Amy Rosenbaum, Tegan Gelfand to its federal affairs team. Rosenbaum, who served as legislative director and an assistant to former President Barack Obama, joined CVS Health earlier in January and will be vice president over the federal affairs team. Rosenbaum was a longtime Hill staffer and former aide to then-House Speaker Nancy Pelosi.

Gelfand, who worked for top Hill Republicans like Reps. Paul Ryan, Kevin Brady and Peter Roskam and Sen. Chuck Grassley, first joined CVS Health in October 2016 for a role in policy and regulatory affairs.

American College of Physicians adds Julie Hirschorn. Hirschorn, who will be in ACP's public affairs shop, previously was a senior associate at the Herald Group.





By Victoria Colliver

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You can’t get more Silicon Valley than this: A concierge medical practice founded by former Uber and Google employees that wants to be like Apple or Facebook. More, from Sheila Marikar in The New Yorker.

A new JAMA study suggests that Maryland's "global budgets" haven't transformed care as defenders of the model suggest. More.

PBS NewsHour’s Laura Santhanam examines the health ministries that as many as a million Americans have joined. More.

ALS patient Ady Barkan writes in The Nation about how he took to social media when his insurer denied coverage for a breathing machine. Such denials are not an anomaly. More.

The Democrat congressman behind the "Stable Genius Act" says he's happy with Trump's physical exam, the Washington Examiner's Kimberly Leonard writes. More.

Emily Oster and Geoffrey Kocks write in the New York Times’ blog The Upshot about how California fixed its vaccination rates after the 2014 measles outbreak. More.

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