Bipartisan Cadillac Tax Bill Introduced in the Senate

Sen. Dean Heller (R-Nev.) and Sen. Martin Heinrich (D-N.M.) introduced legislation last week to repeal the Affordable Care Act’s (ACA) “Cadillac Tax.” The tax will go into effect in 2018 and will impact any employer health insurance plans that cost more than $10,200 per year for individuals or $27,450 per year for families. Employers will have to pay 40 percent of the cost above the statutory limits. A study has shown that approximately a quarter of employers will be subject to the tax unless they change their benefit plans. The bill sponsors argue that the tax unfairly targets people who receive health insurance from their employers. A bill to repeal the tax was introduced in the House by Rep. Joe Courtney (D-Conn.) earlier this spring, but has yet to see a vote. Repeal of this ACA provision is estimated to cost $87 billion.

CBO Releases New Individual Mandate Estimates

According to the Congressional Budget Office (CBO), repealing the Affordable Care Act’s (ACA) individual mandate would lower the deficit by $305 billion over the next decade but would result in 14 million people becoming uninsured. That would bring the total number of people without health insurance coverage to 43 million, a level not seen since 2013. Eliminating the mandate would also cause premiums to rise by 20 percent in the individual market, according to CBO estimates.

Energy and Commerce Continues Consideration of Medicaid Legislation

The House Energy and Commerce Health Subcommittee held a hearing last week to discuss four pieces of legislation aimed at strengthening the Medicaid program. The first bill, the Medicaid Directory of Caregivers (DOC) Act, would require state Medicaid programs that operate fee for service and/or primary care case management programs to include a directory of physicians who have served Medicaid patients in the prior six months on the Medicaid program’s website. Also under consideration was the Program of All Inclusive Care for the Elderly (PACE) Innovation Act (H.R.3243), which would allow the Centers for Medicare and Medicaid Services (CMS) to test the PACE model with new populations. H.R. 670, the Special Needs Trust Fairness Act, would allow individuals to set up their own special needs trust. Finally, H.R. 209, the Ensuring Access to Clinical Trials Act, would allow individuals to participate in clinical trials for rare diseases and conditions without counting the income earned from these trials against their eligibility for the Medicaid program. This hearing was the second subcommittee hearing in recent weeks to examine the Medicaid program.

Robert Califf Nominated to Head the FDA

The President nominated Dr. Robert Califf to lead the Food and Drug Administration (FDA) last week. Dr. Califf is currently serving as the FDA’s second-highest ranking official overseeing the agency’s centers for drugs, devices, and tobacco products. He first joined the FDA in January as deputy commissioner. While Dr. Califf spent over thirty years of his career as a cardiologist and a medical researcher at Duke University, he has previously worked on expert committees that advise the FDA. If confirmed by the Senate, he will be forced to address pressure from Congress to streamline regulations for medical products. In July, the House of Representatives passed H.R. 6, the 21st Century Cures Act, which would require the FDA to quicken the drug approval process, consider more flexible clinical trials, and incorporate the patient perspective in the FDA’s approval process. The Senate is expected to unveil its own version of the bill and begin consideration before the end of the year. The Senate Health, Education, Labor, and Pensions (HELP) Committee will hold a hearing on Dr. Califf’s nomination. Chairman Lamar Alexander (R-Tenn.) has said the nomination will be considered promptly.

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