Healthcare policy experts at Avalere shared some insights into the politics of a less ambitious Build Back Better bill and the healthcare provisions it might include. If a skinny bill falters, then the healthcare action of the Biden administration might shift to CMS’ Innovation Center and payment models including a successor to the Oncology Care Model.

A “skinny” version of the Build Back Better legislation is still possible, and it very well might include drug pricing provisions, according to Avalere healthcare policy experts.

But if the pared-down bill doesn’t pass by an informal Memorial Day deadline, then any advancement of the Biden administration’s healthcare agenda is likely to happen through programs developed by the Centers for Medicare and Medicaid Innovation Center (CMMI), the Avalere experts told attendees of the 2022 Asembia Specialty Pharmacy Summit this week in Las Vegas.

Lance Grady

Lance Grady, head of market access at Avalere, described CMMI as “a little quiet as of late” but that he expected it to spring into action if the skinny version Build Back Better stalls and with that, the end of the possibility of legislation that would have CMS negotiate some drug prices for Medicare.

“We expect CMMI to pick that baton up and start to test value-based coverage and value-based assessment in a more holistic way,” Grady said during the Wednesday afternoon at the Asembia meeting. “This is very doable through Part B. This is very doable through a demonstration project.”

Grady described the Oncology Care Model (OCM) as one of the CMS’ most successful value-based payment models so far. He noted the popularity of the program with oncology providers because the shared savings means they are “actually deferring revenue from your hospital competitor down the road. That type of a business model is very attractive to oncology providers.”

“We are hoping to see CMMI advance something here that builds on the back of OCM,” Grady continued. “How that will address biosimilars, how that will address drug pricing, how that will address health equity, continues to be a bit of a moving target.”

Ryan Urgo

Ryan Urgo, managing director, health policy, Avalere, described the skinny Build Back Better legislation as “still a live wire.” He said the Biden administration and Congressional Democrats are under pressure to “score a big win in the run-up to the mid-term election.” There is also “action-forcing” pressure on the administration and the Democrats to maintain the enhanced Affordable Care Act (ACA) subsidies that were enacted as part of the COVID-19 public health emergency.

Urgo said a politically viable skinny Build Back Better bill would likely include provisions to address climate change, a rollback of some of the Trump administration’s tax cuts, preserving the enhanced ACA subsidies that are scheduled to expire at the end of this year, and drug pricing provisions.

Urgo said big three” drug pricing provisions under consideration are CMS negotiation of drug prices for Medicare, inflation-based caps on drug price increase and Medicare Part D benefit redesign, which might include out-of-pocket limits once beneficiaries hit the catastrophic phase of the coverage.

Sen. Joe Manchin, whose opposition to the more expansive Build Back Better legislation is one of the main reasons it stalled in the Senate after getting passed by the House of Representatives in November 2021, wants to see half of the funding of the skinny version of the legislation go towards deficit reduction, according to Urgo. If Manchin prevails, he said, that could have implications for the funding of the legislation if so much of the money goes toward deficit reduction. “The magnitude of the pay-fors would actually be not so skinny,” Urgo said.

Neil Lund

Neil Lund, senior adviser, market access, spoke about Part D. “It is all about the premium,” he began, noting that increased CMS subsidies would likely offset the upward pressure on premiums resulting from benefit redesign. “By restructuring the program, the subsidies will get back to where they should be,” he said. The recently issued final rule for Part D also has provisions that will create pressure to raise premiums, but Lund the Part D plans are likely to turn to the “usual levers” like rebates and networks to mitigate the pressure.

Lund noted the Biden administration’s health equity agenda, but he predicted that any Part D changes embodying that emphasis would be “baby steps” because of the lack of precedent: “There is no roadmap.”