Based on AHLA’s annual Health Law Connections article, this special series brings together thought leaders from across the health law field to discuss the top ten issues of 2021. In the first episode, Martie Ross, PYA, speaks to Eric Zimmerman, McDermott Will & Emery LLP, about the impact that the new Biden Administration will have on health policy. They discuss what to expect from the Administration and Congress in the weeks and months ahead, focusing on the COVID pandemic, expanding coverage under the Affordable Care Act, surprise billing regulations, and the continued transition to value-based payment models. Sponsored by PYA.
To learn more about AHLA and the educational resources available to the health law community, visit americanhealthlaw.org.
The American Health Law Association is pleased to present this special series highlighting the top 10 issues of 2021, where we bring together thought leaders from across the health law field to discuss the major trends and developments of the year. Support for A H L A in this series is provided by P Y A, which helps clients find value in the complex challenges related to mergers and acquisitions, clinical integrations, regulatory compliance, business valuations, and fair market value assessments, and tax and assurance. For more information, visit pya pc.com.Speaker 2:
Welcome everyone to ALA's podcast series on the top 10 Issues in Health Law 2021. You know, for the past decade, A H L A has published this annual predictions article, and this year we're taking it a step further, uh, bring it to you live. Uh, I'm joined today by Eric Zimmerman with McDermott Will and Emory, who pinned the insightful piece on the new President's Signals new focus for federal health policy. Good morning, Eric.Speaker 3:
Good morning, Marty. Thank you so much.Speaker 2:
Okay. Um, so in the article, which I presume you wrote at the end of December, since it had a January 1st publication date, um, a few things have happened,<laugh> and probably one of the most impactful happened long before the inauguration, which was the January 5th, um, uh, Georgia election, which gave us a Senate Majority and made Chuck Schumer the majority leader. How much did that development, um, impact what you now see going forward for the Biden administration?Speaker 3:
Uh, well, you're absolutely right, and that's always the danger of, uh, trying to look into the crystal ball a little bit. Marty hath be prepared to eat some glass and, um, things move quite quickly under, um, normal circumstances. I think they're moving really at light speed right now in Washington, so for sure, um, I I hope that what I wrote, uh, back in December provides a largely true roadmap for how things are gonna unfold. But of course, we've had a lot of real world developments in the meantime. And, and you pointed to, um, the results of the January 5th election, which, uh, was certainly out there as, uh, a prospect when I wrote the article, but, um, could not have predicted that particular outcome. And it is hugely impactful hugely, and we're seeing it play out, uh, right now in how, uh, democrats and the Pres Democrats in Congress and the President are moving forward with, uh, covid relief legislation, the American Rescue Plan. But for sure, um, the having a democratic majority in both the House and Senate does enable Democrats to set the agenda, uh, and pace what kind of legislation comes to the floor, but it by no means, particularly with the margins that, um, they are left to work with by no means sure's outcomes. And, uh, we saw some of those, uh, challenges play out this past weekend with the American Rescue Plan, which we can talk more about. Um, but look, uh, Democrats have a very thin majority in the house. They actually lost seats in the house, and so don't have a, um, a lot of, uh, room for error in the house. And of course, they have, um, a 50 50 split in the Senate with the ability to break ties, uh, with the vice president, but of course, they must hold the entire caucus together again. We saw the challenges of that, uh, play out very recently. And so that is going to, uh, really limit the breadth of, uh, the agenda for the president in 2021.Speaker 2:
Well, let's say that this administration's top three priorities are Covid, COVID, and Covid. Um, what do you see as the strategy going forward for the administration on that challenge?Speaker 3:
Well, for sure,<laugh>, those are the top three priorities. I think you captured it perfectly. Um, and I'd say the strategy going forward is of course, to, um, first and foremost get on top of the pandemic, and that is, um, uh, first bringing a more centralized federal role to Covid response. Um, you see that, um, in the president's personal engagement on all things Covid. You see it with the Coronavirus task force that he has impaneled. Um, you see that with, um, very prominent roles for Dr. Fauci right now, uh, even more so than in 2020. So much of the, uh, response is, is being centralized and being federalized. Um, but also, um, and, and so I think the number one, uh, component of the strategy is really to get on top of the Pan Pandemic in this legislation. Um, they are working very hard to, uh, simultaneously jumpstart the economy. And, um, I think if they can do both of those things, hopefully will see a, a different world in short order.Speaker 2:
So if President Biden, who famously said his vice president that the Affordable Care Act was a big blanking deal, um, certainly there'll be attention paid to expanding coverage beyond even what was achieved with the aca. Um, for example, I mean, the American, uh, rescue plan includes a provision that tries once again to entice states to expand Medicaid. What else do you see, um, as potential strategies to be employed by the administration around expanded coverage?Speaker 3:
Yeah, so expanded coverage is, is absolutely gonna be one of the major, um, focal points for this administration. And I think, uh, a lot of supporters of the Affordable Care Act and supporters of that objective were really impressed to see some very early steps taken with respect to executive action, a couple of executive orders by, uh, the president very early on. But then also, as you point out, some provisions right here in the American Rescue Plan that, um, attempt to make, uh, purchasing coverage more affordable for individuals with, um, uh, premium tax credits, uh, more, uh, richer premium tax credits, as well as, um, more federal support for, uh, um, purchase of, uh, premiums when you're in purchase of, in, of insurance coverage, when individuals in a Cobra period. Um, but those are really just the beginning of trying to get more people covered through existing mechanisms and with additional federal support to do so. I think, um, there are two other major components that we should be keeping an eye on. One is, uh, undoing some of the, uh, insurance options that the previous administration made available for individuals, including the short term limited duration insurance plans and association health plans, which were, um, non-compliant alternatives. I think we should expect this administration to be putting forward some kind of re rulemaking undoing those, um, options. Likewise, we've already seen steps and we will see more undoing some of the flexibilities that the prior administration made available to states through 1332 waivers and 1115 waivers under Medicaid program. Um, this administration is going to, um, uh, try to encourage more, um, Medicaid expansion, but not, uh, by imposing things like work requirements or other limitations. Um, but then the next big thing is gonna be what big expansion option can, uh, Democrats advance to make, um, new opportunities available to many more people? And if you can think back to, um, really about a year ago when the, um, there was a much larger field of Democrats buying for the nomination. The Democratic Party itself was going through a big reckoning on what it wanted its platform to be on healthcare coverage. And, uh, there was a battle between, uh, progressives like Bernie Sanders who were in favor of a Medicare for all type of approach. And, um, vice president at the time, Biden, who was favoring a public option, of course, he won, and that concept won out. And so, uh, I expect to see, um, him put forward some kind of public option type of approach as an alternative in, in the exchange marketplace or some other, um, approaches that maybe make Medicare more available to more people, either through a lower, um, um, age requirement or a, uh, a buy-in type of, uh, option, but making more federal options available to more people to expand coverage further.Speaker 2:
Um, so given the first three priorities and, and access being the fourth, um, any idea on timing when we start these debates over what a, what a public option may look like or have we sort of, you know, bandaged over the issue with these expansions that were included in the, the expansions of, of exchange plans and incentives for Medicaid expansion in the American Rescue plan?Speaker 3:
Well, I would, it, it's good question and predicting timing is always difficult, but I think the administration's first priority again, is gonna be to get on top of, um, the pandemic and, um, if they can expand coverage in the meantime, um, through some of the provision, some of the, you know, additional federal support or, you know, one thing, um, a neglected dimension is right out of the gate, they created a special enrollment period of six weeks making that, um, giving people another opportunity to enroll in, um, federal exchanges. Um, I think you're gonna see the administration moving down a track all year long on steps that are within their purview to pursue administratively, things that they can do either through, um, uh, new regulations or program guidance or just, um, federal government involvement, like more, more money for navigators, more, um, high level, uh, marketing around, uh, enrolling in, in, uh, affordable Care Act programs like you used to see President Obama. Do. I think those will be going on all year long as far as a big legislative push that's gonna have to be, I believe, later in the year. And I say that because I think, um, again, getting on top of the pandemic and stimulating the economy are going to be, uh, really key, uh, first steps before Democrats feel that they can turn their attention to other aspects of, uh, their healthcare agenda. I think, um, after this American Rescue plan is enacted, which should be very soon, we're gonna see another very big stimulus oriented legislative push that I believe is gonna be broadly characterized as a focus on infrastructure, but we'll also have, um, uh, some of the president's environment agenda wrapped into it, as well as some healthcare. Uh, there are plenty of, um, opportunity for infrastructure inve investment in healthcare. So you'll see some healthcare in that bill too. Um, but I think, um, then we're talking about, um, something toward the back end of this year, if not early 2022 for a big, uh, democratic push to expand coverage.Speaker 2:
So one thing that Biden administration will do need to do this year is develop some regulations around the surprise billing provisions that were included in the consolidated appropriations back, uh, uh, appropriations act. Um, obviously a lot of, uh, interest in that topic, um, among healthcare providers. Um, can you provide us any insight, uh, in when we may see those regulations, um, and any specific provisions we should be on the lookout for?Speaker 3:
Yes, for sure. And I will say that's a topic that I'm, uh, keenly interested in on behalf of a lot of clients. And so I've been doing, uh, quite a lot of thinking about, um, the next steps in surprise billing regulations. And I'll start by saying that the no Surprises Act, which, uh, was included in, um, the, uh, uh, another big, uh, coronavirus, um, funding and stimulus bill that was enacted in December. Um, set out very specific, oh, lemme say it differently, a very specific timetable for, um, regulations with the first regulatory, or the first requirement for, um, h H s, the promulgate regulations being July 1st. Then some subsequent regulations to follow, um, October 1st and some others later in the year, um, as well as some in 2022. I think in the best of circumstances that would be a very aggressive timetable for something as complicated as this, that bill requiring these regulations was enacted on December 27th. The first, you know, regulatory strike, as I said, is, is July 1st. So six months to, um, propose a rule on something as, um, conceptually challenging as well, politically thorny as surprise billing, I think, as I said, in investor circumstances is, um, uh, very large task. I think we have every, anything but best of circumstances. There are many reasons why, um, it's gonna be difficult, not the least of which is just about everybody involved in health policy, as I said, is focused on getting on top of the pandemic and doing all of the things that are necessary for that. But, um, we're also in the midst of a, um, administrative transition. And the new administration is still building itself out. It's still populating all the senior roles, uh, that are going to be responsible for this. As we sit here today, Marty, we don't have a secretary of h h s confirmed, and we also don't have a C M S administrator. And, uh, those senior level posts are going to be, I believe, necessary to making the very difficult political judgment calls that are going to go along with rulemaking like this. So, I, I just think it's gonna be very difficult, and I wouldn't be surprised if we get toward, uh, may or June and we start to see signals that, um, h h s is gonna be looking for a little bit of grace on those regulatory deadlines.Speaker 2:
So, one more topic. Um, you know, president Biden was very involved in the Obama administration's creation of the Center for Medicare and Medicaid innovation, and its focus on value-based payment models. And then during the Trump administration, I think it's fair to say we transitioned really from the focus on value-based to risk-based models. Um, there's this promotion of, um, models where, uh, a group of providers would assume downside risk to the exclusion of other incentives, uh, to promote value-based care. Um, you know, Kim Faler, Liz Fowler, excuse me, has been, um, tapped to be the head of C M M I coming out of the Commonwealth Fund. Do you think we're, we'll see a return to the days of old or, um, is there some other direction that you see the administration going on the transition away from straight fee for service?Speaker 3:
So let me start Marty by saying I love the way you put it,<laugh> sh calling it, um, a shift toward risk-based, uh, models. Cause I I think that really does capture thematically where the last administration was trying to go, very much trying to shift risk onto the provider community. And you see that with so many of the models that they tried to put out, um, over the last four years. I think, um, for sure this administration is going to continue to use the tools available through the Innovation center to, to drive the change that they want to see. I would expect that, uh, what we should see coming out of the innovation center in c m s will resemble more, um, of what we saw during the Obama years. Um, many of the same people who, um, were populating c m s in the innovation center in in that time are back in senior roles. Liz Fowler, who, uh, did not previously, uh, work in this function, has been around these models in this world for a very long time. These are all very familiar models to her. Um, you see her and this administration already putting a mark, uh, on some level by, uh, delaying the kidney care model and, uh, postponing the, uh, geographic direct contracting model and, and revisiting what they want the direction of the agency to be. Um, um, but I would still call it largely, um, tinkering around the edges. I, I still think we're, we're going to be marching down this road of, uh, transition from fee for service to value-based. That is not gonna change here. Um, what may change is, um, a different expectation set among, uh, participants, whereas you saw in the Trump administration, um, more of a mandatory approach, more of this is the model and you are going to participate. Um, whereas I think, um, many stakeholders are hoping and expecting a more voluntary approach, more like we had in the Obama administration when it comes to models. If you're ready to participate, come on in. We've got a model for you.Speaker 2:
Excellent. Well, thank you Eric. I've learned a lot in the last 20 minutes or so. Um, can't wait to read the 2022, uh, predictions of where healthcare policy's going to go. Thanks so much,Speaker 3:
Marty, it was great talking to you. Thank you for the time.