Federal Policy Update - February 2022
February 2022
Federal Policy Update - February 2022

By: Julius W. Hobson, Jr.

Funding the Federal Government

The current continuing resolution funds the Federal government until February 18, 2022. The House and Senate Appropriations Committees Chairs and Ranking Members continue their negotiations. They are literally stuck on Senator Richard Shelby’s [R-AL] insistence that national defense receive more funding that is in the latest National Defense Authorization Act. He is also insisting the increased funding for defense be comparable to domestic spending. It appears the Senators and Representatives will not reach an agreement in time to meet the deadline. Therefore, it is likely Congress will have to enact another short-term funding bill.

Congressional Budget Office Report

The Congressional Budget Office released a report entitled The Prices That Commercial Health Insurers and Medicare Pay for Hospitals’ and Physicians’ Services. CBO’s analysis and a review of the research literature found that commercial insurers pay much higher prices for hospitals’ and physicians’ services than Medicare fee-for-service does. In addition, the prices that commercial insurers pay hospitals are much higher than hospitals’ costs. Greater market power among providers consistently leads to prices for commercial insurers that are higher than Medicare FFS’s prices and that vary more widely, both among and within areas. Hospitals and physicians’ groups may have market power because they have a dominant share of the market in an area or because an insurer sees them as essential to its network of providers. Another part of market power has to do with hospitals acquiring physician practices. None of this information is really new, but it’s the first time in some time that any report has compiled everything.

No Surprises Billing Information

The Bureau of Consumer Financial Protection issued a compliance bulletin and policy guidance to remind debt collectors of their obligation to comply with the Fair Debt Collection Practices Act’s prohibition on false, deceptive, or misleading representations or means in connection with the collection of any debt and unfair or unconscionable means to collect or attempt to collect any debt, and to remind consumer reporting agencies and information furnishers to comply with the Fair Credit Reporting Act’s accuracy and dispute resolution requirements, including when collecting, furnishing information about, and reporting medical debts covered by the No Surprises Act.

President’s Stimulus Bill Update

President Biden’s stimulus policy objective, Build Back Better (BBB) is still stalled in the Senate. Senator Joe Manchin [D-WV] wants to start over with a clean slate. Meanwhile, Democrats are struggling over what to drop from their policy own demands.  BBB will take a back seat to the appropriations process due to the closer pending deadline mentioned above. Please note Senator Ben Ray Lujan [D-NM] had a stroke in late January. He had surgery to relieve pressure on the brain but is expected to make a full recovery. However, he will likely be absent from the Senate for at least four weeks, if not longer. That means for floor votes the Senate stands at 49 Democrats and 50 Republicans. Controversial legislation and nominations won’t be considered for floor action. This includes the President’s nominations for head of the Food and Drug Administration and the upcoming vacancy on the U.S. Supreme Court.

America COMPETES Act

On February 4, 2022, by a vote of 222-210, the House passed “America Creating Opportunities for Manufacturing Pre-Eminence in Technology and Economic Strength Act” or “America COMPETES Act” (H.R. 4521). The bill would authorize billions of dollars to support semiconductors, supply chains, scientific research, and more. The Senate passed its version of the bill last year. The House bill has several health care provisions as follows: 

  • Authorize HHS to transfer drugs, vaccines, and other medical supplies from the Strategic National Stockpile to other federal agencies for reimbursement until September 30, 2024, if supplies are less than a year from expiring and can be replenished.
  • Make changes intended to secure the medical product supply chain.
  • Permit COVID-19 tests, PPE, drugs, and other medical supplies to be designated as scarce and critical materials under the Defense Production Act. This allows the President to control how they are allocated in the private market and forces businesses to prioritize federal contracts to procure them.
  • Authorize the President to prioritize materials ordered by state and local governments if they are scheduled to be delivered to those governments within 15 days of a federal order of allocation.
  • Clarify the President’s authority to use the DPA to bolster the supply chain for critical medical supplies, including through payments to domestic companies that produce critical components or raw materials.

The two Houses will have to resolve their differences before the bill can go to the President.


Employers and health-care organizations are pushing Congress and the IRS to waive deductible requirements for telehealth services for 32 million people with some employer-sponsored plans. An emergency Covid-19 policy expired Dec. 31 that enabled people with high-deductible plans and health savings accounts (HSAs) to get telehealth coverage without first having to meet annual deductibles. Some people who had been receiving care at little or no cost by computer or telephone are now receiving bills. More than 125 organizations sent a letter to congressional leaders January 21st urging quick retroactive reinstatement of the CARES provision. According to a survey by the Employee Benefit Research Institute, about 96% of employers adopted pre-deductible coverage for telehealth services as a result of the CARES Act provision. A number of Senators and House Members are working on this matter and have communicated with the Treasury Secretary.

U.S. General Accountability Report on HHS

GAO released a report entitled COVID-19: Significant Improvements Are Needed for Overseeing Relief Funds and Leading Responses to Public Health Emergencies [https://www.gao.gov/assets/gao-22-105291.pdf] which strongly criticized HHS and its handling of the COVID-19 issue. From the report:

  • HHS received approximately $484 billion in COVID-19 relief appropriations from the six COVID-19 relief laws. These relief funds may be used for a range of purposes, such as assistance to health care or child care providers; testing, therapeutic, or vaccine-related activities; or procurement of critical supplies. Of the $484 billion appropriated, HHS reported that it had obligated about $387 billion and expended about $226 billion—about 80 percent and 47 percent, respectively, as of November 30, 2021. 
  • While HHS has taken some actions to address the 115 recommendations GAO has made related to its leadership and coordination of public health emergencies since fiscal year 2007, 72 remain open. For example, HHS has not addressed our September 2020 recommendation to work with the Federal Emergency Management Agency to develop plans to mitigate supply chain shortages for the remainder of the pandemic, thus contributing to the shortage of such supplies as of January 2022.
  • Also, while HHS began to procure additional tests in the latter part of 2021 and into 2022, and the White House recently appointed a new testing coordinator, HHS had not issued a comprehensive and publicly available testing strategy, which we recommend it do in January 2021. Such a strategy is needed to ensure more timely proactive action in the future and the efficient use of billions of dollars in unobligated funds.

Federal Government Vaccine Mandates

After the U.S. Supreme Court ruled the OSHA vaccine mandate for employers with 100 or more employees, the Labor Department withdrew the temporary rule. However, the proposed permanent rule requiring the mandate is still under consideration.

New Residency Programs

In December 2021, the Centers for Medicare and Medicaid (CMS) increased funding for 1,000 new residency programs in rural and underserved communities.