07 April 2025 This Week in Health Policy for April 7 The House and Senate are both in session this week. Republicans will continue to discussions to advance a reconciliation bill.
House Oversight and Government Reform Committee will hold a hearing on "Restoring Trust in FDA: Rooting Out Illicit Products."
House Ways and Means Health Subcommittee will hold a hearing on "Lowering Costs for Patients: The Health of the Biosimilar Market."
Senate set to pass FY 2025 budget resolution. On Thursday (April 3), Senate Republicans voted 52-48, with Senator Rand Paul (R-KY) as the lone Republican joining all Democrats in opposition, to begin debate on a FY 2025 budget resolution that would unlock the reconciliation process for a tax bill, set a current policy baseline that wouldn't require the Senate to off-set the $4 trillion cost of Tax Cuts & Jobs Act (TCJA) extensions, and provide the Finance Committee an instruction for up to a $1.5 trillion deficit increase for additional tax cuts. The Senate may turn to the vote-a-rama process of multiple amendment votes that caps consideration of the budget resolution this evening and perhaps vote on passage of the resolution as early as Saturday morning. Democrats are expected to offer amendments challenging the tax cut extensions, the $2 trillion in mandatory spending cuts that the House plan includes, President Trump's new tariff announcements, and other issues. The Senate's resolution retains the House budget's reconciliation instructions to House committees — including the $880 billion in spending cuts for the House Energy & Commerce Committee — but only mandates nominal savings from Senate committees. That approach postpones difficult intraparty decisions. Some House Republicans only want to vote in favor of tax cut extensions if they are accompanied by significant spending cuts, while other members, including some senators, don't want to pursue deep spending cuts, especially if the Energy & Commerce instruction requires significant Medicaid changes. Trump health nominees. On Tuesday (April 1), the Senate voted 53-45, along party lines, to confirm Mehmet Oz's nomination for CMS administrator. Sens. Tammy Duckworth (D-IL) & Patty Murray (D-WA) did not vote. Lawmakers react to HHS layoffs. In response to the HHS restructuring that began this week (more details below), several Members of Congress have issued statements. Senate Health, Education, Labor, and Pensions (HELP) Committee Chair Cassidy (R-LA) and Ranking Member Sanders (I-VT) sent a letter inviting HHS Secretary Robert F. Kennedy Jr. to testify at a hearing on April 10, 2025, to update the committee on the restructuring plans. No hearing has been noticed as of publishing. In addition, House Energy & Commerce Chair Guthrie (R-KY) and Health Subcommittee Chair Buddy Carter (R-GA) issued a statement in support of the restructuring. House Energy & Commerce Ranking Member Pallone (D-NJ) and Health Subcommittee Ranking Member Diana DeGette (D-CO) asked Chair Guthrie to hold oversight hearings on the topic and in a separate letter with Oversight and Investigations Subcommittee Ranking Member Yvette Clarke (D-NY) the Democrats asked HHS Secretary to provide more detail on the restructuring by April 15. Mr. Kennedy has also received requests for information from Democrats on House and Senate Appropriations Committees, including Rep. Rosa DeLauro (D-CT), Sens. Murray (D-WA) and Tammy Baldwin (D-WI) (link to letter here), and a group of more than 30 Senate Democrats (link to letter here). CMS issues 2026 MA Policy and Technical Changes Final Rule. On Friday (April 4), CMS released its CY 2026 Policy and Technical Changes to the MA Program Final Rule, which includes a number of new policies as well as codifying existing Part C and Part D sub-regulatory guidance. CMS finalized provisions include (non-comprehensive):
FTC Chair reverses course on PBM case. On Thursday (April 3), Federal Trade Commission (FTC) Chair Andrew Ferguson in a statement on X said he will no longer recuse himself from the FTC's court case challenging three large pharmacy benefit managers over alleged anticompetitive practices. The decision comes after the agency asked the court for an administrative stay in the case, after the two Democratic commissioners involved in the proceedings were fired. This may allow the FT case to continue. HHS layoffs begin. On Tuesday (April 1), HHS staff began to receive reduction-in-force letters informing them of the layoffs. Layoffs have been widely reported across agencies, impacting various programs, though the exact scope and impact of the layoffs is still being determined. On Thursday (April 3), HHS Secretary Robert F. Kennedy Jr. told reporters that they expected to rehire 2,000, or 20%, of those who had been fired, stating that the reinstatements were "always part of the plan." For example, Mr. Kennedy said staff at the Centers for Disease Control and Prevention's Lead Poisoning and Prevention and Surveillance Branch were cut in error. At FDA there were layoffs among policy staff, including those who negotiate FDA user fees, and management and operations staff, including those at the Center for Drug Evaluation and Research, Center for Biologics Evaluation and Research, and the Center for Devices and Radiological Health. The agency also has seen several leaders within the agency depart, including Peter Stein the director of the Center for Drug Evaluation and Research's Office of New Drugs and the heads of the Oncology Center of Excellence, which works on medical product reviews. For more details, see attached WCEY Alert - HHS unveils layoff, restructuring plan. CMS instructed to cut $2.7B in contracts. On Monday (March 31), DOGE instructed CMS employees to identify roughly $2.7 billion in contract spending by Thursday (April 3) that could be cut, according to an email shared with Inside Health Policy. The email stated that final contract cancellation recommendations are due to the Assistant Secretary for Financial Resources (ASFR) by April 18. Click here for a list of HHS contracts already terminated. Court strikes down laboratory-developed test final rule. On Monday (March 31), a district court in Texas vacated and set aside the FDA's final rule expanding FDA's regulatory oversight to include laboratory-developed tests (LDTs). The ruling prevents the rule from taking effect as scheduled in May and remands the matter to HHS Secretary Kennedy "for further consideration." Trump imposes new reciprocal tariffs, with pharmaceutical exemption. On Wednesday (April 2), President Trump announced the details of his reciprocal trade agenda, imposing 10% universal tariffs on imported products from all countries and a country-specific ad valorem tariff rate on the countries with which the United States has the largest trade deficits. The 10% tariffs will generally apply "with respect to goods entered for consumption, or withdrawn from warehouse for consumption, on or after 12:01 a.m. on April 5," while the higher reciprocal based tariffs on products from specified countries will take effect April 9, 2025, at 12:01 a.m. The Executive Order states that certain goods will not be subject to the reciprocal tariffs, including imports that are the subject of ongoing Sec. 232 investigations, including copper and lumber articles, as well as pharmaceuticals, semiconductors, and certain critical minerals and energy goods detailed in Annex II. While the new reciprocal tariffs exempt pharmaceuticals, President Trump in his comments and in the EO suggest the industry could still be subject to Sec. 232 tariffs at a future date. When asked by press late last week, Trump said those tariffs would be coming soon. Medical devices and supplies were not exempted. For a list of country-specific adjusted tariff rates, click here. For a list of products exempt from the new reciprocal tariffs, click here. For a more detailed overview, please read the WCEY Alert: President Trump Announces Reciprocal Tariffs, available here. Countries begin imposing reciprocal tariffs. In response to President Trump's April 2 announcement, China announced that it will impose a 34% tariff on all US exports to China. The tariff will be in effect for goods that have departed from place of origin on or after April 10 and reach China by May 13. Trump eliminates de minimis treatment for certain China imports as part of effort to combat fentanyl crisis. On Wednesday (April 2), President Trump signed an EO that closes the "duty-free de minimis treatment for low-value imports from China" as part of the Administration's efforts to combat illicit fentanyl and other substances entering the US through "deceptive shipping practices by Chinese-based shippers." Trump in the EO noted that the action had been on hold until he received notification by the Secretary of Commerce that adequate systems are in place to process and collect tariff revenue for covered goods from China otherwise eligible for de minimis treatment. White House publishes drug policy priorities. On Thursday (April 3), the White House Office of National Drug Control Policy (ONDCP) unveiled the Trump Administration's top six drug policy priorities, which are:
Senate Judiciary Committee held a markup of drug legislation. On Thursday (April 3), the Committee advanced by voice vote six bipartisan bills that aim to lower drug prices. The bills advanced are:
House Energy and Commerce Health Subcommittee held a hearing on "Over-the-Counter Monograph Drugs." On Wednesday (April 2), the Subcommittee held a hearing during which the Subcommittee heard from a panel of witnesses representing producers of consumer health products, cleaning products, and beauty products, as well as cancer and environmental health advocates. During the hearing, much of the discussion from witnesses and Republican members focused on ways the FDA could help develop safe and effective sunscreen products. Republican members also focused their comments on regulation of OTC monograph drugs, while Democrats focused their comments on ways the HHS restructuring could impact the FDA's ability to regulate OTC drugs and medical devices.
House Energy and Commerce Oversight and Investigations Subcommittee held hearing on "Aging Technology, Emerging Threats: Examining Cybersecurity Vulnerabilities in Legacy Medical Devices." On Tuesday (April 1), the Subcommittee held a hearing during which they heard from a panel of witnesses representing providers, cybersecurity experts, and more. During the hearing, witnesses spoke of the need to improve medical device cybersecurity. Republicans focused their comments on cybersecurity threats from foreign nations and the barriers rural hospitals face in implementing cybersecurity protocols, while Democrats focused their comments on the HHS restructuring and how reductions in NIH funding could impact cybersecurity practices.
House Education and the Workforce Health, Employment, Labor, and Pensions Subcommittee held a hearing on "A Healthy Workforce: Expanding Access and Affordability in Employer-Sponsored Health Care." On Wednesday (April 2), the Education and Workforce Subcommittee on Health, Employment, Labor, and Pensions held a hearing that focused on the general challenges faced by small employers who are trying to offer affordable health insurance options and the role of association health plans (AHPs) in expanding access to health care coverage for self-employed individuals. There was also much discussion by members of the possible cuts to Medicaid as a result of the House budget resolution, which directs the House Energy and Commerce Committee to cut $880 billion.
Congressional Budget Office: CBO's Model of Drug Development: Ongoing Updates. The report details the ways in which CBO has updated its drug development model, used to project how legislative proposals would affect the development of new drugs. Health Affairs: Estimated Savings From Extending Prescription Drug Inflationary Rebates To All Commercial Plans. The study estimates that a policy applying the Inflation Reduction Act's inflationary rebates to 1,100 drugs could have saved up to $8.1 billion in 2021.
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