House Passes Budget Framework; Healthcare Cuts Heat Up
The House adopted a budget reconciliation bill today with just one GOP defection. House Speaker Mike Johnson and President Donald Trump got three other doubters to convert to “yes.” The vote was 217 to 215. The bill paves the way for final passage down the road but a great deal of work has to occur, with committees now meeting on spending cut targets. This includes $880 billion in healthcare spending cut targets. Johnson and perhaps Trump convinced holdouts that Medicaid rolls will not be cut except for work requirements and if someone is illegally on the program. It may be hard to keep the commitment with a large reduction bogey. The victory was major for Johnson but he now needs to hold all these folks in place as spending cuts are debated in committees.
Meanwhile, healthcare news is heating up due to the possible spending cuts:
- The Blue Cross and Blue Shield Association (BSCSA) issued a report today that has $1 trillion in healthcare cost reductions over a decade — federal savings of $524 billion, lower private insurance premiums of $389 billion, patient savings of $180 billion. The largest potential area for savings is to adopt site-neutral payments in Medicare, which would save $484 billion over 10 years. I will do a blog on the report next week.
- A Modern Healthcare article explains work requirements and their history in Medicaid.
- The Health and Human Services (HHS) Office of Inspector General (OIG) said that Medicare costs of ten common diabetes medications, including GLP-1s, went up by 364% between 2019 and 2023. In 2019, Medicare spent roughly $7.7 billion. In 2023, the cost reached $35.8 billion.
- Trump plans to sign an executive order to reinforce rules to make healthcare prices more transparent for patients. The order will update agency enforcement policies to make sure healthcare providers and insurers are complying with the rules.
- Insurers overall had a poor 2024 due to various issues, including poor Medicare Advantage (MA) rates. There were a few exceptions.
- A Kaiser Family Foundation (KFF) poll finds that Medicaid is viewed favorably by a large majority (77%) of the public and an even larger share of those on the program (84%). Another poll from Hart Research conducted for the nonprofit Families Over Billionaires finds that 71% percent of voters who backed Trump said cutting Medicaid would be unacceptable.
- A compound pharmacy trade group has filed a lawsuit against the Food and Drug Administration (FDA) for removing semaglutide, the active ingredient in Ozempic, from its drug shortage list. Many Americans use these generic compounds for weight loss due to the $1,000 plus cost of brands. Still, the generic drug costs can be $200 plus a month.
Additional articles: https://www.fiercehealthcare.com/regulatory/bcbsa-report-addressing-hospital-pharma-costs-could-save-1t-over-next-decade and https://www.modernhealthcare.com/policy/medicaid-work-requirements-gop-budget and https://www.beckerspayer.com/payer/medicare-part-d-spending-on-weight-loss-drugs-surges-364-oig.html and https://www.modernhealthcare.com/policy/trump-healthcare-cost-transparency and https://www.healthcaredive.com/news/health-insurer-medical-costs-climbing-ma-medicaid/740611/ and https://www.kff.org/medicaid/report/the-debate-over-federal-medicaid-cuts-perspectives-of-medicaid-enrollees-who-voted-for-president-trump-and-vice-president-harris/ and https://thehill.com/policy/healthcare/5161953-obamacare-medicare-budget-entanglement/ and https://thehill.com/homenews/house/5163381-democrats-medicaid-gop-budget/ and https://thehill.com/policy/healthcare/5163193-trump-voters-oppose-medicaid-cuts-poll/\ and https://thehill.com/policy/healthcare/5163570-weight-loss-drugs-fda-shortage-list-ozempic-wegovy/
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