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With Rachel Roubein, Susannah Luthi, Renuka Rayasam and Adam Cancryn
Editor's Note: This edition of Pulse is published weekdays at 10 a.m. POLITICO Pro Health Care subscribers hold exclusive early access to the newsletter each morning at 6 a.m. Learn more about POLITICO Pro's comprehensive policy intelligence coverage, policy tools and services at www.politicopro.com.
Quick Fix
— Iowa caucus-goers named health care their most important issue, one of the few early takeaways after an error-ridden evening.
— President Donald Trump will use tonight’s State of the Union address to bash Democrats' focus on government-run health care and tout his own emphasis on lowering drug prices.
— HHS may need to shift funds to pay for its response to the coronavirus outbreak, HHS Secretary Alex Azar told Congress.
WELCOME TO STATE OF THE UNION PULSE — Where your author wants to know: After the historic implosion of the Iowa caucus, with results stalled for hours into the morning, what overlooked story should the media have spent last night focused on instead?
Tips to longtime PULSE scribe ddiamond@politico.com or Adam Cancryn (acancryn@politico.com), who officially comes aboard as co-author starting with tomorrow's issue.
Driving the Day
ONE THING WE LEARNED FROM IOWA: SINGLE-PAYER HEALTH CARE RESONATED — Amid the chaos, exit surveys found that nearly 6 in 10 in Democratic caucus-goers preferred government-run health care to private insurance. WaPo's Jeff Stein has more details.
Health care also was the most important issue for Democratic caucus-goers Monday night, with about 4 in 10 saying that it mattered more than climate change, income inequality and foreign policy to their vote.
— But caucus-goers who ranked health care as their top issue had very different visions for the changes they wanted to see; those Democrats split evenly between Sen. Bernie Sanders (I-Vt.), who's pushing a single-payer health care system, and former South Bend, Ind. Mayor Pete Buttigieg, who wants to preserve private insurance and add a government-run public option, CNN reports.
White House
TONIGHT: TRUMP TO HIT BACK ON ‘SOCIALISM’ IN HEALTH CARE — The president is planning to use his State of the Union address to draw a contrast between his administration's focus on unwinding government regulations versus Democrats’ push for greater government control of health care, said four people with knowledge of Trump’s prepared remarks.
— One possible announcement tonight: An insulin fix. The specifics of the initiative are unclear and remained in flux through Monday, POLITICO’s Adam Cancryn and Sarah Karlin-Smith report. But the focus on insulin comes as its price has skyrocketed.
— Another possible focus: Trump putting pressure on Congress over drug pricing. Trump has long vowed to slash drug costs. But three years in, most of his major proposals have stalled or been scrapped, giving Democrats an opening to seize momentum on a pivotal electoral issue. That’s frustrated Trump, who has vented about not getting enough credit for his work on prescription drugs.
Trump's also expected to talk about the need to crack down on health care "surprise" bills, with his administration having pushed health care transparency measures.
WITH NEW MOVES LOOMING, CONSERVATIVES FIRE SHOT OVER ‘PRICE CONTROLS’ — Seventy-five groups are warning Trump against using government powers to set limits on drug prices, surprise bills and other efforts, in a letter to the president and congressional leaders that was shared first with PULSE.
"Whether it is called price fixing, rate setting, subsidy capping, or inflation capping, government price controls have wormed their way into the healthcare reform plans of too many of our friends in Washington," the leaders of Americans for Prosperity, the National Taxpayers Union, the Center for a Free Economy and other prominent conservatives write. The groups last week similarly decried a long-developing plan to tie U.S. drug prices to an index of lower drug prices abroad.
BUT ADVOCATES HIT TRUMP OVER 'DAMNABLE LIE' ON PRE-EXISTING CONDITIONS — Protect Our Care, the pro-Obamacare group, is out with a new digital ad that zings the president's claim he "saved" protections for pre-existing conditions. "That's just a damnable lie," said MSNBC host Joe Scarborough last month — a clip recycled for the new ad.
The ad, shared first with PULSE, will run in battleground states Florida, Michigan, North Carolina, Pennsylvania and Wisconsin. See the ad.
Wuhan Coronavirus
HHS ALERTS CONGRESS THAT FUNDS MAY NEED TO BE SHIFTED — Azar on Sunday told Congress that he may need to use his authority to shift as much as $136 million within the health department to fight the coronavirus outbreak, an HHS spokesperson confirmed Monday.
Azar said he could increase CDC funds by as much as $75 million, said one individual familiar with the notification. Azar also said he could redirect as much as $52 million to the HHS emergency-response office, and up to $8 million to the HHS global affairs office. A spokesperson stressed that HHS alerted Congress “out of an abundance of caution,” given the changing situation and uncertain future funding needs.
The health department has been burning through $105 million in CDC infectious disease funds. The Washington Post first reported the HHS funding plan.
MEANWHILE: U.S. OFFICIALS WAIT TO LEARN IF THEY’LL BE SENT TO CHINA — HHS was still waiting as of Monday to learn if its officials would be be part of an international mission to China to assess the Wuhan coronavirus outbreak amid growing tensions between Beijing and Washington over the U.S. response.
The Chinese foreign ministry on Monday accused the U.S. of creating an atmosphere of fear, contending it “inappropriately overreacted” by warning Americans not to travel to China and temporarily banning foreigners who traveled to the country.
In Congress
MALONEY, WARREN WANT ANSWERS ON GUN VIOLENCE COSTS — House Oversight Chair Carolyn Maloney (D-N.Y.) and Sen. Elizabeth Warren (D-Mass.) are asking for data on U.S. health care costs associated with gun-related injuries, in a letter to the Government Accountability Office shared first with PULSE. They're specifically curious what taxpayers end up spending on readmissions, rehab, long-term care and other treatments linked with gun violence.
"A more comprehensive understanding of how these costs are borne by federal health care programs — particularly Medicaid and Medicare — would help inform congressional deliberations on this critical topic," Maloney and Warren write. Read the letter.
BIPARTISAN BILL TARGETS CMS INNOVATION CENTER — Four lawmakers on Monday moved to place guardrails on CMMI, arguing the center overseeing Medicare payment experiments needs increased accountability and better transparency.
H.R. 5741 — introduced by Reps. Terri Sewell (D-Ala.), Adrian Smith (R-Neb.), Tony Cárdenas (D-Calif.) and John Shimkus (R-Ill.) — would require the HHS secretary to monitor the effects that a demonstration project has on access to care, create an expedited congressional disapproval process for models and add more opportunities for public input.
The Trump administration is using the center to drive its overhaul of kidney care, health care payments and other projects. CMS declined to comment on pending legislation, according to a spokesperson.
AFL-CIO URGES AGAINST RELYING ON ARBITRATION TO STOP ‘SURPRISE’ BILLS — The labor federation warned lawmakers against supporting “surprise” medical bill legislation that would expand the use of arbitration, according to a letter obtained by POLITICO’s Rachel Roubein. The influential unions’ position comes as the House Ways and Means Committee readies language this week expected to rely on letting independent mediators resolve billing disputes when private negotiations hit an impasse.
The AFL-CIO instead says the “optimal approach” is tying payments to a federal benchmark. If arbitration is used in a final deal, restrictions included in a December proposal from House Energy and Commerce leaders and the Senate health committee chairman “should be preserved,” according to the letter sent to all House members last week.
— There’s time pressure on getting a deal: Lawmakers are trying to unite on a single approach before a May deadline to fund key health extenders, viewed as the best chance to send surprise bill legislation to Trump’s desk.
SENATORS PRESS CMS ABOUT OVERBILLING IN MEDICARE ADVANTAGE — Three progressive senators urged top Medicare officials to crack down on Medicare Advantage plans for exaggerating the ill health of their customers, POLITICO’s Susannah Luthi reports.
Sens. Sherrod Brown (D-Ohio), Sanders and Richard Blumenthal (D-Conn.) cited a December watchdog report that found plans may have gamed Medicare Advantage to overcollect about $6.7 billion in 2017 alone.
— Medicare Advantage has emerged as a cash cow for some major private insurers, Susannah notes. But plans say so-called upcoding complaints ignore other systemic problems in the payment process that need addressing.
CMS is reviewing the letter, a spokesperson told POLITICO, adding that the agency also runs audits and makes “several technical adjustments” to address reporting patterns by MA plans. CMS recently proposed giving insurers less say about their enrollees’ health profile.
2020 Watch
CANDIDATES SAY THEY'LL RESTORE MEDICAID COVERAGE FOR ISLANDERS — Spokespeople for the campaigns of Sanders, Warren, Sen. Amy Klobuchar (D-Minn.), former Vice President Joe Biden and businessman Andrew Yang all vowed that their candidates would provide coverage for residents of the Marshall Islands, a population profiled by POLITICO last week, as well as cover residents of Palau and Micronesia. A Buttigieg spokesperson said his campaign was "open to exploring options for this population."
The United States had pledged that the islanders would have access to Medicaid through a 1986 pact, which was signed about four decades after the U.S. military began using the Marshall Islands for extensive nuclear-weapons testing. Islanders and researchers have linked the tests to myriad cancers and other health problems. However, the 1996 U.S. Personal Responsibility and Work Opportunity Act stripped the islanders of their access to Medicaid, a decision described as a legislative oversight.
The issue has special resonance in Iowa, as an estimated 800 Marshall Islanders have relocated to Dubuque, seeking free or low-cost health care at a clinic that specializes in serving their population.
Around the Nation
TEXAS: APPEALS COURT HEARS ARGUMENTS OVER INFANT ON LIFE SUPPORT — A state appeals court is hearing oral arguments this morning over whether a Fort Worth hospital can end life-saving care to a 1-year-old baby with severe medical issues, POLITICO’s Renuka Rayasam reports.
Doctors at Cook Children’s Medical Center last year wanted to remove the infant, Tinslee Lewis, from life support and invoked a 1999 law that gave a family 10 days to find a new facility if they disagreed with a doctor’s decision to end care. The family is appealing a judge’s decision that would allow the hospital to end care in a case that has captured national attention and heightened political tensions over end-of-life care.
The appeals court previously issued an emergency order requiring the hospital to continue providing life-saving care.
Names in the News
SK BOWEN is now press secretary for Energy and Commerce Committee Republicans, handling their health care and oversight and investigations portfolios. She was previously a press assistant and digital coordinator for the committee.
SEAN RILEY is leaving the Hill to join the White House's legislative affairs team, said two people with knowledge of the move. Riley was previously chief counsel and legislative director for Sen. Ron Johnson (R-Wis.).
What We're Reading
With Rachel Roubein
Will Americans see higher paychecks under Medicare for All? In The New York Times, economist Austin Frakt details how some wages will rise, but not for all jobs or labor markets.
States are scrambling over how to implement new Trump administration travel restrictions and where to quarantine passengers arriving from China to try to stop the coronavirus from spreading, The Washington Post reports.
As the coronavirus dominates public health officials’ attention, the flu is infecting children at unusually high rates this year, The Wall Street Journal’s Sumathi Reddy writes.
Home health agencies are cutting physical, occupational and speech therapy, firing therapists and indicating that Medicare doesn’t cover certain services any more. That’s the impact of a new Medicare rule changing how the health program pays for therapy, according to Kaiser Health News’ Judith Graham.
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