January 21, 2025
Health Policy Report – January 21, 2025
The Network Publishes 2025 Capitol Brief
The Network is thrilled to announce that its 2025 Capitol Brief is now live on LegisLink! Over the last year, The Network’s advocacy efforts have emphasized the value of community oncology to policymakers, setting the stage for Medicare physician pay reform, advancing site neutral payment reform, and addressing anti-competitive hospital behavior.
The Capitol Brief showcases those who participated in our annual fly-in and highlights physicians who have authored opinion articles in influential outlets like The Washington Post, STAT, and KFF Health News.
The Network also championed several state policies, engaging our community in practice site visits, advocacy events, and notable meetings with lawmakers throughout the year. If you are interested in hosting a site visit for your state representative or state senator, please contact Angela.Storseth@usoncology.com .
To read the 2025 Capitol Brief, CLICK HERE.
Dr. McNally Pens Op-Ed in MedPage Today on Shortage of Independent Surgeons
In an op-ed in MedPage Today, Dr. Amy McNally, The Network’s Chief Surgical Officer, describes how reimbursement for surgical professional services has declined, disproportionately affecting private practices and tipping the scales toward hospital settings.
As reimbursement shrinks, Dr. McNally explained, independent practices have found it increasingly difficult to remain afloat, let alone to attract and retain top-tier talent. “Hospitals, on the other hand, have responded to declining reimbursement by charging facility fees to offset financial losses, including from declining Medicare reimbursement,” Dr. McNally wrote.
Over the past few years, hospitals have increasingly charged facility fees, which can cost up to thousands of dollars and often come as a surprise to patients. Hospitals claim that these fees cover the use of hospital space or equipment. “Yet, the way these funds are used by hospitals is opaque – but perhaps the increased revenue gives hospitals a leg up in offering more attractive salaries to surgeons,” Dr. McNally noted.
“Two things are clear. First, cutting reimbursement for surgeons isn’t bringing healthcare costs down. Rather, it’s emboldening health systems to jack up fees, raise out-of-pocket costs, and limit competition from community-based providers. Second, and more importantly, the shift toward hospital-based care isn’t improving patient outcomes,” she concluded.
Dr. McNally called on Congress to shine a light on the use of facility fees and how they impact competitiveness in the healthcare marketplace.
To read Dr. McNally’s op-ed, CLICK HERE.
Federal Trade Commission Releases Second Interim Report on PBMs
The Federal Trade Commission (FTC) published a new report on pharmacy benefit managers (PBMs) and their impact on the drug supply chain.
Following an initial investigation into PBMs last July, the FTC’s second report examined over 50 specialty generic drugs dispensed between 2017 and 2022 for members of commercial health plans and Medicare Part D prescription drug plans managed by the so-called “Big Three” PBMs – CVS Caremark, Express Scripts and Optum Rx. The FTC uncovered substantial price markups that treat cancer, HIV, and other life-threatening illnesses.
The FTC also highlighted that PBMs steered highly profitable prescriptions to their own affiliated pharmacies. According to the report, these PBMs’ affiliated pharmacies earned more than $7.3 billion by dispensing revenue in excess of their estimated acquisition cost, in addition to earning $1.4 billion from spread pricing on specialty generic drugs.
FTC Chair Lina Khan called for the continued investigation into large PBMs and for regulators to halt any
practices that may inflate drug costs and squeeze independent pharmacies.
In response to the report, CVS Health criticized the FTC report stating it “cherry-picked” specialty generic outliers and that specialty generic products represent only 1.5% of their clients’ total drug spend. Express Scripts and Optum pointed to an industry and legislative need for lowered drug pricing, emphasizing their efforts in helping patients save money and reduce out-of-pocket payments.
To read the report, CLICK HERE.
To read the FTC’s statement, CLICK HERE.
To read more, CLICK HERE.
MedPAC Recommends Tying Physician Payment to Inflation
The Medicare Payment Advisory Commission (MedPAC) – the body that advises Congress on Medicare payment – voted to recommend that Congress tie next year’s physician payment to the Medicare Economic Index (MEI) minus one percentage point, resulting in a 1.3% increase.
The MEI measures inflation in medical practice costs. “The recommendation should maintain clinicians’ willingness and ability to furnish care and should maintain or improve clinicians’ willingness and ability to treat low-income beneficiaries,” Geoffrey Gerhardt, a MedPAC principal policy analyst, said during the meeting.
The recommendation comes as advocacy groups, including the American Medical Association, push to reverse this year’s cut in a potential March legislative package. “When MedPAC forwards its report to Congress in March, the AMA hopes that lawmakers heed MedPAC’s analysis concluding that Medicare payment to physician practices under current law is inadequate and downright threatening to patient access to care,” said Bruce Scott, President of the AMA.
Congressional committee leadership has taken note of physician’s push for a pay fix. Senator Mike Crapo (R-ID) has been confirmed as the Chairman of the Senate Finance Committee for the 119th Congress, overseeing key federal budget decision-making in health care legislation and federal programs like Medicare and Medicaid. In a statement outlining Crapo’s priorities for the new Congress, he emphasizes the need to continue bipartisan work to stabilize physician payments for the long term, as well as enact pharmacy benefit manager (PBM) reform. Senator Crapo underscored how the committee must work to “reward providing better care at a lower cost.”
To read about the vote, CLICK HERE.
To read the AMA’s statement, CLICK HERE.
To read Senator Crapo’s statement as newly elected Chairman, CLICK HERE.
The New York Times Highlights Concerns About the 340B Drug Pricing Program
A new investigation from The New York Times draws back the curtain on the 340B Drug Pricing Program, which requires pharmaceutical manufacturers to provide outpatient drugs to eligible healthcare organizations, known as “covered entities.”
The program, established in 1992, was originally intended to help a small number of safety-net hospitals access affordable drugs and expand care to patients. Today, however, the program has grown exponentially, and a large number of nonprofit health systems have been accused of maximizing payouts to boost profits.
As the program has evolved, The New York Times found that Apexus, a little-known middleman, has been allowed to collect a fee for almost every drug sold under the program. Despite being discouraged from influencing drug prices, Apexus has prioritized helping hospitals capture as many prescriptions as possible and has pushed to expand the program. While 340B discounts have come under congressional scrutiny, Apexus has gone largely unexamined.
To highlight how 340B pricing impacts patients, The New York Times profiled Virginia King, a patient who received cancer at a large hospital center in Santa Fe, which passed on the cost of discounted cancer drugs and sent her a bill for over $2,500 — “more than half my take-home salary for a month,” she said.
“Mrs. King switched to a free-standing oncology clinic that does not qualify for the federal drug program. That clinic billed her insurance $8,000 for the injection, about a third of what Christus St. Vincent had charged. Her responsibility was nothing,” read the story.
To read the story, CLICK HERE.
Congressional Republicans Focus on Site Neutral Payment Reforms
As the 119th Congress begins, lawmakers have set their sights on site neutral payment reform as a potential offset to House Republicans’ reconciliation bill or other spending reform efforts.
An early list of potential spending offsets that originated from the House Budget Committee, chaired by Representative Jodey Arrington (R-TX), includes $146 billion in potential savings from site neutral payment reform. House Republicans are also considering a repeal of Biden administration health care rules.
Meanwhile, House Republicans on the Energy and Commerce Committee met to discuss potential cuts to existing healthcare programs, changes to pharmacy benefit managers, and site neutral payment reform. “We’re still in the process of just throwing mud up against the wall to see what sticks,” Rep. Buddy Carter (R-Ga.), Chair of the Energy and Commerce Health Subcommittee, told reporters.
The momentum comes as the Paragon Institute, an influential conservative think tank, recently published a new policy brief on opportunities to enact site neutral payment reform in 2025. “The start of a new Congress and presidential administration means new opportunities to improve federal health programs such as Medicare. Site neutrality is a way to achieve significant savings for patients and taxpayers without cutting benefits,” the brief notes.
Meanwhile, former Speaker of the House Newt Gingrich (R-GA) and Bobby Jindal, former Governor of Louisiana, recently penned an op-ed calling on President-Elect Trump to follow through on his first-term efforts to immediately strengthen and enforce healthcare price transparency rules. “President Trump can unite these Americans and burnish his legacy by making health care price transparency a reality and ushering in an affordable and accountable health care system,” they wrote.
To read more, CLICK HERE.
To read the Paragon Institute’s brief, CLICK HERE.
To read Newt Gingrich and Bobby Jindal’s op-ed, CLICK HERE.
Senate Report Scrutinizes Private Equity in Healthcare
The recent Senate Budget Committee Bipartisan Staff Report examines private equity ownership of hospitals, revealing questionable financial and safety practices. In the report, the committee analyzed over a million documents from Leonard Green & Partners (LPG) and Apollo Global Management, two private equity firms that acquired hospital operators.
The report found that the PE firms controlled the hospitals’ board of directors, key committees, and staffing, focusing on financial goals rather than quality of care. The committee noted that these practices leave hospitals in a financial bind, putting additional strain on the nation’s healthcare infrastructure, home $424 million of the $645 million that PMH paid out in dividends and preferred stock redemption, leaving the hospital struggling to pay its bill.
“Private equity has infected our health care system, putting patients, communities, and providers at risk,” Chairman of the Senate Budget Committee Sheldon Whitehouse (D-RI) said in a statement. “As our investigation revealed, these financial entities are putting their own profits over patients, leading to health and safety violations, chronic understaffing, and hospital closures.
To read the report, CLICK HERE.
To read a statement, CLICK HERE.