Meet Ariel Gonzalez, Advocacy Expert and Basketball Coach

Ariel Gonzalez, one of the newest team members at Chamber Hill Strategies, has seen the advocacy landscape change considerably over the course of his 20-year career in Washington.  Each of Ariel’s accomplishments has provided countless learning opportunities that he uses to help clients achieve their goals.  We talked to Ariel about what he’s learned and about how his passions for basketball and martial arts keep him grounded. 

What are some of the highlights of your career? 

In my six years at AARP when I ran their health and family team on the federal level, I was able to prevent Medicare beneficiaries from paying more in out-of-pocket costs.  I’m really proud of being able to hold the line and protect tens of millions of Medicare beneficiaries from harmful proposals.  A little later in my career, I led and coordinated an effort to get substantial mental health and substance use disorder reform as a part of the first 21st Century Cures Act when I was Chief of Government Relations at the American Psychiatric Association.  It was wonderful to collaborate with some of the other large mental health organizations, like the American Psychological Association, Mental Health America, the National Alliance on Mental Illness, and others to advocate for substantive change in terms of how mental health and substance abuse is addressed.  

How has advocacy changed since you first started your career?  How has advocacy changed over the last 10 years?

Advancements in technology as they relate to grassroots advocacy have been outstanding over the last 20 years.  When I started the health care portion of my career in 2002 at Premier, Inc., the advocacy tools we had then were so elementary compared to the sophistication of grassroots advocacy tools that we have available today.  Within the last 10 years, the ability to have microtargeted messaging to legislators in real-time such as social media messages have been key.  Before, we had to rely on letter-writing, which transitioned to faxing, and then emailing.  Today, social media plays a huge role in everything we do, including digital advocacy from grassroots and grasstops perspectives that allows organizations to move the needle with legislators in real-time via targeted messaging.

What are some of the biggest challenges lobbyists and advocates face in 2021?

You can’t speak about advocacy in 2021 without speaking about the pandemic.  The transition to virtual advocacy was a significant challenge in 2020, and in 2021, I think most lobbyists and Hill staff have begun to understand that this is the new normal.  Certain Hill staff have even expressed they would like this to continue with virtual advocacy post-pandemic because they think it accelerates efficiencies in meetings and helps with their schedules.

On another note, I’d say another huge challenge in 2021 is the hyperpartisanship that is evident on Capitol Hill.  Over the last several years, it’s just gotten uglier and uglier between the parties.  I was just reading something from House Majority Leader Steny Hoyer (D-MD) where he was expressing concern in the House that even broadly supported, bipartisan bills that should be voted on under suspension are now being called out to do roll call votes just to be a thorn in the side of the majority.  That’s why as a lobbyist, I work to leverage our relationships in a way that benefits clients in this partisan environment. 

What’s some of the best advice you’ve received?

“The only thing constant in life is change.”  I use that as a mantra to continuously evolve as a person, a lobbying professional, a father, a husband, and as a contributing member of society.  Being able to understand the dynamic of things in Washington – the power changes, power shifts, being able to roll with the punches – is really critical.  The ability to believe in yourself has really been something that I hold close as I faced various challenges. 

What else should we know about you?

I’ve coached both youth and high school basketball since 2003.  I love to play when I can and teach my knowledge of the game to the kids.

I’ve also dabbled over the years in acting, both on stage and on screen as a way to develop tools to become a better public speaker.  Speaking publicly to strangers translates well in terms of performing live on a stage or in front of a camera. 

Finally, I’m a big martial arts guy.  I’ve been studying and training various martial arts on and off since the age of 5, and I’ve coached martial arts, too.  I definitely enjoy it, and it’s really helpful in a number of circumstances in life – from learning discipline when I was younger to feeling confident in handling myself in a variety of situations.

What Does the Rise of SPACs Mean for Health Care?

In 2019, special purpose acquisition companies (SPACs) raised $13.6 billion.  In 2020, they raised $83 billion.  The boom in SPACs hasn’t been lost on the health care industry, which saw 50 health care-focused SPACs go public in 2020 alone.  However, the rapid growth of SPACs has caught the attention of regulators and lawmakers, which means the boom may not last forever.

Also known as blank check companies, SPACs are shell companies that raise capital in an initial public offering (IPO) for the purpose of later acquiring a private company.  Typically, SPACs sponsors have 18-24 months to complete an acquisition.  If the acquisition fails, the SPAC is dissolved, and the money is returned to its existing shareholders.  Some investors see SPACs as more attractive than traditional IPOs because of faster access to the market and confidentially negotiated terms.   

SPACs are encroaching on the health care industry, albeit at a limited rate.  Of the 120 SPACs that were actively seeking an acquisition target in October 2020, only 15% were considered targets in the health care/life sciences space.  Among the health care companies that went public in the US last year through SPACs are MultiPlan, a health care cost management solutions platform, SOC Telemed, a telemedicine provider, and Cerevel Therapeutics, a biopharmaceutical company.

Take SOC Telemed.  SOC Telemed, a national provider of acute care telemedicine solutions, merged in July 2020 with special purpose acquisition company Healthcare Merger Corporation.  Now listed on Nasdaq (TLMD), SOC Telemed used its strong financial performance during the pandemic and its cash infusion from investors to acquire Access Physicians, a multi-specialty acute care telemedicine provider.  SOC Telemedicine is now the largest pure-play provider of acute care telemedicine, serving over 700 hospitals across 47 states.  All that in ten short months.

While health care SPACs under scrutiny per se, the rapid growth of SPACs is starting to catch the eye of government officials.  On April 8, the Securities and Exchange Commission said it will be heavily looking into SPACs going forward, with a focus on disclosures by sponsors and acquisition targets for any misleading statements or omissions, such as projections or valuations. 

SPACs are attracting attention in Congress, too.  In March 2021, House Financial Services Committee members Reps. Brad Sherman (D-CA) and Bill Foster (D-IL) recently expressed concern that companies may be using SPACs to evade disclosures and liabilities, thereby putting unwitting investors at risk.  While these concerns have yet to yield any serious congressional inquiries or legislation, consumer advocates are pushing Congress to take action.  In February 2021, Americans for Financial Reform sent a letter to House Financial Services Committee leaders with several policy recommendations to reign in SPACs, including enhanced disclosure requirements and more study into the risks of SPACs.

Until regulatory and legislative action is taken, however, there seems to be no end in sight to the growth in SPACs.  Therefore, only time will tell the implications of blank check companies for health care providers – and what these implications could mean for patients and consumers.

The Week in Review: April 12-16

Survey Finds Drop in JNJ Vaccine Confidence

On April 13, the Centers for Disease Control and Prevention (CDC) and the Food and Drug Administration (FDA) recommended the US pause usage of the Johnson & Johnson (JNJ) vaccine after six women ages 18-48 developed a severe blood clot out of the 6.8 million doses administered so far. According to a poll conducted by YouGov and The Economist in the wake of the recommendation, the number of people who felt the JNJ vaccine was safe declined from 52% to 37%, while those who felt the vaccine was unsafe jumped from 26% to 39%.  Critics of the government’s recommendation say the pause is directly contributing to an increase in vaccine hesitancy, while federal officials say demonstrating the safety of vaccines is paramount to maintaining public confidence.  Notably, the public’s views on the safety of the Moderna and Pfizer vaccines remain unchanged.  

CDC Advisory Panel Punts Decision on JNJ Vaccine Pause

On April 14, the CDC Advisory Committee on Immunization Practices (ACIP) declined to vote on recommendations to continue using the JNJ COVID-19 vaccine, just a day after federal officials announced a pause in JNJ vaccinations over safety concerns.  ACIP opted to maintain the pause to allow more time to gather additional data about the blood clots that occurred in six vaccine recipients.  The Committee will reconvene in 7-10 days to decide whether to continue the pause, allow JNJ vaccinations to continue with certain restrictions, or bar the JNJ vaccine from continued use altogether.  Until the committee votes on recommendations, the pause will likely continue.

Pelosi Has “No Plans” to Bring Bill to Expand SCOTUS to the Floor

Speaker Nancy Pelosi (D-CA) told reporters on April 15 that she has no plans to bring to the House floor a bill from Rep. Jerry Nadler (D-NY) that would add four seats to the Supreme Court, which would effectively tilt the Court in Democrats’ favor.  However, Pelosi said expanding the court is “not out of the question,” and she expressed support for the Biden Administration’s commission to study changes to the Supreme Court, which include adding seats or instituting term limits.

Top W&M Republican Announces Retirement

Rep. Kevin Brady (R-TX), who currently serves as Ranking Member of the House Ways and Means Committee, announced on April 13 that he will not seek reelection to a fourteenth term in Congress.  Brady, who has represented the northern suburbs of Houston since 1997, was term-limited out of being the top Republican on powerful tax-writing committee in the next Congress.  Among the House GOP members eyeing Brady’s seat is Devin Nunes (R-CA), Vern Buchanan (R-FL), Adrian Smith (R-NE), Jason Smith (R-MO), and Mike Kelly (R-PA).

Dem Pollsters Admit to Flaws in Predicting Outcome of 2020 Election

Sure, most polls were correct in saying Joe Biden would win the presidency, but hardly anyone predicted Democrats would lose seats in the House and the Senate would be split 50-50.  Six months later, a group of leading Democratic pollsters reconvened to find out what went wrong.  According to a memo they released on April 13, the pollsters underestimated the amount of Republican turnout on Election Day and the reluctance among Republicans to participate in surveys.  Going forward, the pollsters say they are less likely to use live-interview phone calls and more likely to use innovative methods like text messages to prompt survey participation.

ICYMI: Poll Says DC Is the Worst State

A YouGov poll released on April 13 found the District of Columbia – which is not even a state – last in a ranking of US states from best to worst.  The poll, which asked respondents to choose the better of two states in a series of head-to-head matchup, ranked states according to how often they “won” in the matchups.  Fortunately, the District’s neighboring states fared better in the poll – Virginia came in third, while Maryland was ranked 26.

5 Things to Know about In-Person Advocacy

Will we get back to in-person meetings on Capitol Hill?  When??  How?  COVID-19 is still around, even as the country’s mood is lightening about the overall impact of the virus.  And the safety and security of lawmakers and staff are of top-of-mind after the deadly January 6 riot and April 2 attempt at breaching the Capitol grounds.  Let’s explore  when in-person meetings might return and what those meetings could look like.

It is happening?

By and large, in-person advocacy isn’t happening, at least not on the Hill.  Since March 2020, advocacy has shifted online to videoconferencing like Zoom and telephone calls.  However, that doesn’t mean Members haven’t been yearning for a return to normal.  On March 10, House Republican Leader Kevin McCarthy (R-CA) sent a letter to Speaker Nancy Pelosi (D-CA) requesting a timeline on when certain in-person activities can restart, including allowing visitors in House office buildings.  While Pelosi has not officially responded to the letter, many Democrats say it’s premature to relax restrictions, partially due to the fact that a number of Republican lawmakers have yet to be vaccinated.   

Any decision on when to loosen restrictions will ultimately be up to Democratic leadership in the House and Senate, in consultation with the Office of the Attending Physician (OAP).  While the Capitol complex and adjacent congressional office buildings are exempt from public health guidelines from the Government of the District of Columbia, leadership and the OAP are using local COVID-19 health guidances to inform decisions.  These guidelines were last updated February 23 and include masking, de-densifying Hill offices, staggered schedules, and teleworking.

What is open?

Presently, both the House and Senate office buildings are only open to Members, staff, and credentialed press, and while official business visitors are permitted in congressional offices, they must always require staff escorts.  House staff may only escort a maximum of nine visitors at a time, while Senate staff are limited to 15 visitors.  However, this does not mean that advocates have regular, unfettered access to congressional offices. 

What about off the Hill?

Over the past few weeks, some lawmakers and staff, mostly Republicans, have resumed some degree of in-person activities, including fundraising dinners, due to relaxations in local restrictions on event sizes as well as new CDC guidelines that allow small groups of vaccinated individuals to gather in-person.  Republicans are also hosting fundraising trips around the country.  Lobbyists and advocates are also interacting in-person with legislators instates and congressional districts where COVID-19 restrictions have been loosened more considerably. 

When will things get back to normal?

Anecdotally, some congressional staff and lobbyists are saying in-person meetings may not be permitted on Capitol Hill until 2022.  Whether this happens sooner or later depends on countless factors, including the pace of vaccinations, level of vaccination hesitancy, local restrictions in DC, and to what extent any COVID-19 variants impact the effectiveness of current vaccines. 

What will change permanently?

With most details about the future of in-person meetings on the Hill being speculative, one likelihood is the continued use of videoconferencing technology that can complement in-person meetings.  During the pandemic, teleconferencing has been used to great effect to connect advocates who normally wouldn’t be able to make a trip to Washington with lawmakers and staff, which leaves open the possibility for a “hybrid” approach that incorporates building relationships both in-person and virtually.

Furthermore, the aftermath of the January 6 riot on Capitol could serve as the basis for other permanent changes.  Even after the pandemic ends, some congressional staff and lobbyists feel that certain security measures could stick around, meaning limits on in-person meetings could persist.  For instance, limits on group sizes could continue, which would certainly impact large-scale fly-ins.  At the moment, however, both Members of Congress and lobbyists are more focused on removing physical barriers such as fencing and razor wire from the perimeter of the Capitol complex.  On March 15, for example, the National Institute for Lobbying & Ethics sent a letter to the Speaker urging the removal of all physical barriers by July 1. 

Is the Future Now for a Lower Medicare Eligibility Age?

Some birthdays are more special than others.  Turning 16 means a drivers license is within reach and turning 18 grants the ability to cast a ballot.  For many Americans, turning 65 means they are finally eligible for Medicare coverage.  However, this milestone for turning 65 could soon change, as top Democrats weigh the possibility of lowering the eligibility age for Medicare.

On April 9, 2021, President Joe Biden reiterated his goal to lower the Medicare eligibility age to 60, a policy position he first laid out as a presidential candidate in 2020.  According to the President, a lower eligibility age would help Americans retire early and provide insurance coverage for those who are unemployed. 

Allowing Americans under 65 to enroll in Medicare isn’t exactly a new proposal; for over a decade, many Democrats have suggested a Medicare buy-in that would allow those five to 10 years below the current eligibility age to receive coverage by paying a premium.  Additionally, many of these previous proposals called for people not to enroll in Medicare itself, but rather in a Medicare-like plan operated by the federal government. 

The President’s proposal, however, would simply entail lowering the eligibility age, thereby allowing everyone within the expanded age group to enroll in Medicare.   

What About Bernie?

Long-time single-payer proponent Sen. Bernie Sanders (I-VT) has also been pushing for a lower Medicare age.  His plan is more far-reaching than Biden’s in that it would lower the eligibility age to 60 or 55 and provide dental and vision coverage. 

Cha-Ching

Lowering Medicare’s eligibility age could be pricey.   The Journal of the American Medical Association (JAMA) estimates that there are currently 20 million Americans aged 60-64 with commercial insurance, Medicaid, or no insurance coverage at all.  With an estimated average $5,000 per year in per-capital spending on this age group, JAMA projects an infusion of 20 million beneficiaries to Medicare could cost the program up to $100 billion per year. 

However, one could surmise that the price of lowering Medicare eligibility could be, at least in part, offset by potential savings to the government that could result from persons receiving subsidized coverage through an Affordable Care Act (ACA) plan switching to Medicare coverage. For instance, should persons 60-65 years who are enrolled an ACA plans shift into Medicare coverage, what impact would this have on risk pools and could premiums for ACA plans, overall, drop in price as a result? It will be interesting to see how the Congressional Budget Office (CBO) projects this budgetary impact. 

Medicare Insolvency?

Regardless of whether any shifts from ACA coverage to Medicare coverage could offset the price of the proposal, there remains questions as to what the impact may be on the Medicare Hospital Insurance Trust Fund, which is projected to reach insolvency by 2024

The growth in Medicare spending has been a concern for years, leading for some to call for the program’s eligibility age to be RAISED in order to save money.  According to a Congressional Budget Office report from 2011, raising the Medicare eligibility age to 67 would save the program $125 billion over a decade.  Since then, several prominent Republicans including then-2012 presidential candidate Mitt Romney have called for the program’s eligibility age to be raised by two years. 

Proponents of a higher eligibility age say the move would be a better targeting of the government’s resources, given the rise in the nation’s life expectancy since Medicare was first created and the fact that younger Medicare beneficiaries are less likely to have health problems than their older counterparts.  Others have said a higher eligibility age could keep more Americans in the workforce.  Meanwhile, opponents say raising eligibility age would simply shift costs from Medicare onto commercial insurers, Medicare, and individual Americans. 

Opposition

But lowering the age for Medicare eligibility is on the table now, not raising the age.  So where do health care industry stakeholders stand on lowering the Medicare age?  They aren’t happy.  Hospitals, for instance, may have the most to lose from a lower Medicare eligibility age because Medicare pays hospitals at a lower rate than commercial insurers.  Additionally, the addition millions of new Medicare beneficiaries would give Medicare considerably more bargaining power when setting prices with hospitals and other providers, including nursing homes and dialysis facilities. 

For insurers, there could be winners and losers, depending on the strength of any given company’s Medicare Advantage (MA) market share.  MA has been one of the fastest-growing lines of business for insurers, and with new Medicare beneficiaries disproportionately more likely to choose MA over traditional Medicare, a lower eligibility age could mean a windfall for insurers with MA plans.  However, for insurers who have focused more heavily on their group market business, they could see insureds shifting to MA as a loss, unless they are able to become competitive in MA markets.

What’s Next?

It is difficult, given Democrats’ small margins in the House and Senate, to ascertain a quick path to enactment of dropping the eligibility age to 60.  Some in the caucus will argue it is not enough, that a public option is what is needed.  Others may view this as an incremental win towards government-run healthcare.  However, with the prospect of using the budget reconciliation process again, at least one more time and possibly two, in play, as well as Speaker Nancy Pelosi (D-CA) recently signaling support for lowering the Medicare age, a more fleshed-out proposal that expands Medicare access and contains other Democratic health priorities has the potential become the party’s newest target for policy action.  

The Week in Review: April 5-9

Senate Dems Have Two More Opportunities to Use Budget Reconciliation

The Senate Parliamentarian ruled on April 5 that Democrats may use budget reconciliation two more times this year to override a Republican filibuster and pass a major legislative package with 50 votes.  This sets the stage for Senate Democrats to use reconciliation to advance the Biden Administration’s $2.25 trillion infrastructure package if certain conditions on revenue and spending are met.  Senate Democrats already used budget reconciliation in March to advance the American Rescue Plan Act of 2021 (P.L. 117-2).

Administration Bumps Vaccine Eligibility Date to April 19

On April 6, the Biden Administration announced that every adult in the nation will be eligible for a COVID-19 vaccination by April 19, nearly two weeks ahead of the original deadline of May 1.  In a press briefing preceding the announcement, White House Press Secretary Jen Psaki said the new date can be attributed to an expedited supply of vaccine doses and improvements in distribution.  However, the Administration continues to urge Americans to remain vigilant and adhere to public health guidelines as parts of the nation see an increase in cases.

Florida Congressman Passes Away, Narrowing Democratic Majority

Representative Alcee Hastings (D-IL) died on April 6 at age 84 following a two-year bout with pancreatic cancer.  The Florida congressman’s death narrows Democrats’ majority in the House down to seven, leaving Speaker Nancy Pelosi (D-CA) with tighter margins to advance Democratic legislative priorities.  Voters in Hasting’s district, which stretches from Fort Lauderdale to West Palm Beach, will have an opportunity to choose a new Representative in special election that has yet to be announced by Republican Governor Ron DeSantis

Poll Finds Largest Gap between in Party Affiliation since 2012

A Gallup poll conducted in the first quarter of 2021 found an average of 49% of US adults identified with  or lean towards the Democratic Party, while 40% identify or lean Republican.  The nine-percentage-point Democratic advantage is the largest Gallup has measured since the fourth quarter of 2012.  The poll also found 44% of Americans identify as political independents, compared to 38% in the fourth quarter of 2020.  Most of the gains in independent affiliation came at the expense of Republicans who saw a 4% decline in party identification since the fourth quarter of 2020 compared to Democrats’ 1% drop over the same period.  This data means Republicans’ hopes of retaking Congress in the 2022 midterms may hinge on appealing to independent voters.

CMS Begins Proposing FY22 Payment Rates

This week, the Center for Medicare and Medicaid Services began proposing Fiscal Year 2022 payment rates for the following prospective payment systems:

Comments for all four proposed rules must be received no later than 5 PM EDT on June 7, 2021.

ICYMI: Trump Weighs In on 2022 Senate Races

Former President Donald Trump has already begun endorsing Republican candidates ahead of the 2022 midterms.  Republicans face an uphill battle to retake the Senate in 2022 – while Democrats only have to defend 14 seats, Republicans must defend 20.  On April 8, Trump issued a statement urging the currently undecided Sen. Ron Johnson (R-WI) to seek reelection.  Democrats flipped Wisconsin from red to blue in the 2020 presidential election, and Johnson’s Senate seat is sure to be hotly contested in 2022.  A day earlier, Trump endorsed Rep. Mo Brooks (R-AL) to succeed Sen. Richard Shelby (R-AL), who has opted not to seek reelection.

The Government’s Ambitions Plans to Grow Broadband Access

A major barrier to widespread telehealth adoption in the United States is lack of access to broadband internet.  While telehealth utilization has surged since the start of the COVID-19 pandemic, telehealth’s potential for growth is limited by lack of high-speed internet connections for both patients and providers.

However, not all Americans have access to broadband.  A 2019 Federal Communications Commission (FCC) report found 21.3 million Americans, or 6.5% of the population, currently lack access to broadband.  Furthermore, a 2021 survey by BroadbandNow found 42 million Americans are unable to afford broadband without any assistance.  According to the Office of the National Coordinator for Health Information Technology, broadband service provides a higher-level speed of data transmission, which is particular important for live videoconferencing with health care practitioners.  Additionally, broadband allows health care providers to meaningfully use patient information, such as electronic health records, to improve patient outcomes. 

Fortunately, the federal government has taken some steps to boost broadband access. To help patients afford broadband access, the Consolidated Omnibus Appropriations Act, 2021 (P.L. 116-260) provided $3.5 billion to the FCC to establish a program to help low-income Americans get or stay connected to broadband.  The program is required to provide a $50 subsidy for qualified households who must include at least one individual who is eligible for the Lifeline Program, the Supplemental Nutrition Assistance Program, or a Pell Grant.

Providing direct government subsidies to individuals to access broadband looks likely to be part of an upcoming legislative effort to address the nation’s infrastructure needs.  The American Jobs Plan, the Biden Administration’s highly anticipated $2 trillion infrastructure proposal, high-speed broadband to every American, including the 35% of rural Americans who lack high-speed broadband.  Among the ways the Administration plans to achieve this include:

  • Providing individual subsidies to cover internet costs in the short-term and reducing costs through widespread adoption in the long-term.
  • Prioritizing support for broadband networks owned or operated by local governments, non-profits, and cooperatives.
  • Promoting transparency and competition among internet providers and requiring providers to publicly disclose prices their charge.

Direct subsidies are also included in the Leading Infrastructure for Tomorrow’s (LIFT) American Act.  Co-sponsored by all 32 Democrats on the House Energy and Commerce Committee, this proposal will provide a basis for House Democrats’ action on energy and broadband in the Congressional infrastructure bill.  The bill would grow high-speed internet access by:

  • Authorizing an additional $6 billion for the FCC program that provides a discount of up to $50 off the cost of monthly broadband service for eligible households. 
  • Providing $80 billion to develop secure broadband nationwide by funding connections to underserved rural, suburban, and urban communities.
  • Allocating $5 billion in federal funding for low-interest financing of broadband deployment.

While health care providers are already advocating for making permanent some of the Medicare and Medicaid flexibilities for telehealth enacted into law as the result of the coronavirus pandemic, they should be keen to keep an eye out for additional discussion and debate on broadband access.  Both the government’s recent actions to expand broadband and Democratic proposals to boost broadband even further suggest a strong desire to build out an infrastructure that will allow telehealth to flourish in a post-pandemic world.

ICER’s Growing Influence on Drug Value

The Institute for Clinical and Economic Review (ICER) has grown to become a leading voice on drug pricing in the US.  As the emphasis on value in the US health care system and concern over high drug prices continues to grow, more stakeholders are likely to look to ICER for guidance on whether a drug is appropriately priced. 

ICER was founded in 2006 by Dr. Steve Pearson, an ethicist from Harvard Medical School, with the goal of improving value in health care.  One of the main ways ICER seeks to carry out this mission is by publishing reports on whether new drugs are cost-effective.  Using both economic and clinical evidence, ICER determines a “value-based price benchmark” for each drug it studies based on the based on how much a patient’s quality of life improves.   While ICER does take some membership-based funding from companies including CVS-Caremark and Pfizer, the organization does not accept funding to perform research on specific drugs or therapies. 

ICER’s influence began to grow in 2015 thanks to financial support from billionaire John Arnold, who provides the organization over two-thirds of its funding.  Now, the organization plays a critical role in driving the national conversation on drug prices and value.   Only a third of ICER’s reports have found a drug to be cost-effective and appropriately priced, and in response, many drug companies, payers, and providers have adopted some of the organization’s pricing recommendations.  For example:

  • CVS Health allows its commercial plan clients to exclude drugs from their formularies that fail to meet ICER’s cost benchmarks.
  • Novartis set the price of its gene therapy drug Zolgensma in line with ICER’s recommendations.
  • The Department of Veterans Affairs uses ICER drug assessment reports in drug coverage and price negotiations with the pharmaceutical industry.
  • ICER’s cost effectiveness reports on PSCK9 inhibitors, which are used to manage and prevent cardiovascular disease, drove annual list prices down from $14,600-$14,100 to $5,850.
  • A report by ICON plc found over a third of payers surveyed would be likely to request a rebate to match the net ICER cost-effective price.

ICER isn’t without criticism.  As a private organization, ICER has drawn concerns from patient advocates and physicians for its lack of oversight and regulations.  Additionally, the organization has faced pushback over the use of its quality-adjusted life years (QALYs) formula, which estimates a drug’s dollar benefit.  Some patient advocates say QALY determines costs in a discriminatory manner because the formula assigns individuals with a chronic condition or a disability with a lower value.  Notably, the federal government is prohibited from using QALYs to measure cost-effectiveness under the Affordable Care Act. 

In the future, Cost-effectiveness itself is a complicated concept in light of growing trends:  ICER could impact health care based on growing trends:

  • A heightened focus on health disparities could prompt ICER to review how different therapies affect certain demographic groups.
  • In the oft-chance the US adopts a public health insurance option or even a single-payer system, ICER could play a greater role in dictating cost-effectiveness.  For example, the United Kingdom-equivalent of ICER has significantly more clout in the country’s National Health Service. 
  • ICER may be forced to adjust its methodologies to address the growth of personalized medicines such as cell and gene therapies, which benefit a relatively limited number of individuals compared to therapies the organization has traditionally studied.

Furthermore, if the US adopts a public health insurance option or even a single-payer system, ICER could play an even greater role in drug coverage and pricing.  The United Kingdom-equivalent of ICER has direct decision-making authority within the country’s National Health Service. 

Amazon Moves to Disrupt Health, Influence Policy

Amazon is primed to disrupt primary care just like the tech giant has done to retail, cloud computing, and package delivery services.  This time, it’s telehealth. 

On March 17, 2021, Amazon took a major step forward in expanding its health care reach by announcing  plans to make Amazon Care, its virtual health service benefit, available to all of its US employees this summer.  Furthermore, Amazon announced its telehealth service will be available to other companies.  Over the next few months, the company also intends to expand its Amazon Care in-person health centers to Washington, DC, Baltimore, and several other cities. 

In September 2019, the company launched Amazon Care for employees and their families in the Seattle metropolitan area.  Amazon Care offers telehealth as well as in-person primary care visits at patients’ homes or in-office.  Additionally, the service incorporates Amazon Pharmacy, the company’s prescription drug delivery service that launched in November 2018

Amazon Care is not the company’s first foray into health care.  In addition to Amazon Pharmacy, the tech giant teamed up with primary care group Crossover Health in 2020 to launch health care centers near its operations facilities and fulfillment centers in Phoenix, Louisville, and Dallas-Fort Worth, with more facilities planned in 2021.  Notably, the company joined forces with JPMorgan Chase and Berkshire Hathaway in January 2018 to launch a new non-profit venture called Haven.  The new venture was intended to utilize the vast resources of its founding companies to address the complexity of health care coverage and rising health care costs. However, Haven was eventually scuttled in January 2021, with lack of a strategy, leadership turnover, and the enormous scale of problems facing the US health care industry cited as likely culprits. 

As illustrated by Haven, Amazon Care’s success is far from guaranteed.  The service faces stiff competition from other well-funded telehealth services, including Doctor on Demand and PlushCare.  Additionally, there has yet to be any data posted on whether Amazon Care has been successful in reducing costs, which was one of Haven’s initial goals.  However, Amazon Care stands out from its competitors by offering integrated pharmacy services and a potential built-in customer base from the over 150 million Amazon Prime subscribers. 

Through its recent ventures into the health care industry, Amazon may be signaling a desire to use its growing health care clout to influence health care policy.  In March 2021, Amazon Care joined with Intermountain Healthcare, Ascension, and several other providers to launch Moving Health Home, a new coalition aimed at changing the way “policymakers think about the home as a site of clinical service.”

Amazon’s desire to impact home health care policy is reflective its overall efforts to enhance its advocacy capabilities in recent years.  In 2020, the company logged $18.7 million in lobbying expenditures, including on health care matters, a nearly two-fold increase from its $9.4 million total expenditures in 2015.  Amazon also boasts 17 registered lobbyists in addition to the 24 lobbying firms on its retainer.  Former Obama Administration White Press Secretary Jay Carney has served as the company’s Senior Vice President of Global Corporate Affairs since 2015, and the company notably chose the Washington, DC metropolitan area for the site of its highly anticipated second headquarters.

By growing its influence in Washington and demonstrating a wiliness to shape home health and other policy areas, Amazon may be using its newfound efforts in telehealth and primary care as another means to sway health policy and achieve its goal of disrupting health care in America.  

Following Lawsuit, HHS Delays SUNSET Rule

Delays in your online shopping deliveries?  Yeah that’s annoying, and increasingly common even a year into COVID-10.  Delays in federal government rules?  Yeah that’s welcome news for health care stakeholders.  On March 18, the Department of Health and Human Services (HHS) delayed the effective date until 2022 of a controversial rule that requires HHS to review over 17,000 regulations.  The rule’s delay comes as a relief to health care providers, who worried the potentially herculean regulatory review process would create uncertainty across the health care industry and serve as a distraction from HHS’s efforts to address the pandemic.

Finalized on January 8, the Securing Updated and Necessary Statutory Evaluations Timely (SUNSET) rule calls for HHS to review any regulations over 10 years old to ensure they are up to date.  Any rules that are not reviewed or approved by 2026 will automatically expire.  However, the Biden Administration issued a regulatory freeze shortly after the President’s inauguration on January 20 that applied to all rules and regulations that had yet to be implemented.   With the regulatory freeze set to expire on March 21, the Biden Administration moved to delay the rule’s implementation until March 22, 2022.

In the announcement, HHS joined stakeholders in their concern over the lack of bandwidth to review properly hundreds of thousands of pages of rulemaking. Specifically, HHS noted the rule’s impact on the Food and Drug Administration’s ability to review medical product applications as well as higher uncertainty and compliance costs for Medicare providers and suppliers. 

The rule, while delayed, is wrapped up in legal proceedings.  The American Lung Association and the National Association of Pediatric Nurse Practitioners filed a lawsuit in March against HHS to strike down the rule.  While not commenting on the litigation, the Biden Administration did note that delaying the SUNSET rule for one year is to allow the courts to conduct a “judicial review of its legality.”  If the courts fail to issue a ruling by March 2022, it is possible HHS will once again delay the SUNSET rule’s implementation.