Health policy forecast for 2021

After the elections of 2020, a new administration and a shift in Congressional seats may impact the direction of healthcare over the next few years. Beyond the Physician Fee Schedule (PFS) for 2021 and the expanded reimbursement policies for the use of telehealth during the pandemic and beyond, the health policy forecast for 2021 includes possible action on:

• The Affordable Care Act
• Prescription drug prices
• Policies affecting women’s health.

Patient Protection and Affordable Care Act (ACA)

A pending lawsuit on the ACA, California v Texas, is currently before the Supreme Court. In November 2020, the court heard oral arguments about the ACA’s individual mandate, in particular whether it became unconstitutional in 2017 when Congress amended it to reduce the penalty for noncompliance to $0. Depending on the court’s decision, some or all of the ACA could be struck down along with the mandate.  

The ACA has been challenged before. In 2012, a court ruling upheld the individual mandate. The new lawsuit offers the court the opportunity to reconsider that decision. In the previous lawsuit, NFIB v Sebelius, it was alleged that the mandate was unconstitutional because the power of Congress to regulate interstate commerce does not extend to requiring people engage in such commerce. That commerce would be purchasing health insurance in this case. At the time, Chief Justice John Roberts held that the individual mandate can be construed not as an illegitimate attempt to exercise the commerce power, but as a permissible tax on people who do not enroll in health insurance.

340B Drug Pricing Program

A final rule regarding section 340B of the Public Health Service Act (PHSA) is effective as of January 13, 2021. The Health Resources and Services Administration (HRSA) implements section 340B, which is referred to as the 340B Drug Pricing Program. The final rule, which sets forth the requirements and procedures for the 340B Program’s administrative dispute resolution (ADR) process, applies to all drug manufacturers and other covered entities participating in the program.

Section 340B of the PHSA is entitled Limitation on Prices of Drugs Purchased by Covered Entities. The program permits covered entities to “to stretch scarce Federal resources as far as possible, reaching more eligible patients and providing more comprehensive services.” Section 340B(a)(1) of the PHSA instructs HHS to enter into pharmaceutical pricing agreements (PPAs) with manufacturers of covered outpatient drugs.

When a drug manufacturer signs a PPA, it agrees that the prices charged for covered outpatient drugs to covered entities will not exceed defined 340B ceiling prices. Those prices are based on quarterly pricing reports that manufacturers must provide to the Secretary through the Centers for Medicare & Medicaid Services (CMS).

Women’s Health Policies

There are two health policy issues focused on women’s health that will be up for consideration in 2021.

• Title X family planning. The regulations currently require complete financial and physical separation from abortion services, including referrals, for family planning providers funded by the program. Over 25% of participating providers have left the program since the previous administration’s changes were put in place, with six states and at least half of providers in eight other states exiting the program.
• Improving maternal health. While all states must provide health coverage to pregnant women on Medicaid with incomes up to at least 138% (about $30,000 for a family of three) of the federal poverty level through 60 days after they give birth, gaps remain in coverage beyond that timeframe in many states. Health policy changes in 2021 may expand to include state and federal options to extend coverage beyond 60 days postpartum.

Elation Health will continue to monitor health policy updates throughout the upcoming year, to help independent practices remain aware of policies and regulations that may affect their success in 2021 and beyond.