+1 800.648.4807

Policy Update


Policy Update – Updated 

by Christoper E. Condeluci, Principal and sole shareholder of CC Law & Policy PLLC in Washington, D.C.


It’s Ground Hog Day

  1. Current – and former – Congressional staff like to attach the phrase “Ground Hog Day” to legislative and political exercises that are a redux – or a re-tread – of past exercises. For example, re-litigating old political fights = Ground Hog Day. Also, slogging through a legislative exercise that Congress slogs through over-and-over-and-over-again = Ground Hog Day.


  1. Analysis: Here are some examples from this January and February (and into March):


Debate Over Eliminating the Filibuster – As you may recall, dating all the way back to the run up to the 2020 elections, there was talk among Democrats running for the Senate that, if elected, they would eliminate the Senate’s filibuster. Then, once the Democrats regained the majority in the Senate, calls to eliminate the filibuster reached a fever pitch. Then, when Congressional Democrats were UNABLE to increase the minimum wage through the “reconciliation” process, the notion of eliminating the filibuster was once again discussed. Most recently, Congressional Democrats took steps to pass voting rights legislation, and these efforts precipitated – once again – a robust debate over whether all 50 Senate Democrats would agree to eliminate the filibuster, even if the filibuster was ONLY eliminated for 1 particular issue (here, the voting rights bill).

UPDATE: Even if a “skinny” Build Back Better Act is considered in the House and Senate over the next few months, I believe that the debate over eliminating the filibuster is OVER. Why? Because first, Sens. Manchin (D-WV) and Sinema (D-AZ) continue to oppose eliminating the filibuster, and trying to twist their arm – yet again – could actually back-fire as we inch closer to the mid-term elections. In my opinion, the law-of-diminishing-returns applies here. Second, it appears that most Democrats agree with the prognostication that Republicans will re-take the House in the mid-term elections. If this happens, eliminating the filibuster does Senate Democrats NO good because any legislation passed on party-lines in the Senate in 2023 or 2024 will go NOWHERE in the House. Also, even though the Senate will be considering a new Supreme Court nominee (discussed more fully below), the filibuster has ALREADY been eliminated for Supreme Court nominees. Sooooooooo, no need to debate eliminating the filibuster here.


Government Shutdown Showdown – Each and every year (for more years than I would like to count), both political parties – regardless of which party holds the majority in Congress or the White House – fight over legislation to fund the government. As you recall, this fight has led to a number of government shutdowns in year’s past. Congress is once again faced with a government “shutdown showdown,” as the latest deadline for funding the government is Feb. 18th. So again, it’s Ground Hog Day. I will note, it looks like Democrats and Republicans will agree to a short-term funding bill – funding the government through March 11th. BUT, come March 11th…wait for it…it’s Ground Hog Day!!

UPDATE: The House and Senate successfully averted a government shutdown by passing a short-term funding bill before the Feb. 18th deadline. The next deadline for this “spending bill” is March 11th. As I noted in my last update, come March 11th…it’s Ground Hog Day!!


Supreme Court Vacancy – While not necessarily a Ground Hog Day-type issue, it is important to point out that we are now experiencing our 4th Supreme Court vacancy in 5 years. And, because the Senate is required to hold confirmation hearings for whomever is appointed to fill the vacancy – which has proven to incite long-drawn out (and sometimes nasty) political fights – this definitely falls into the Ground Hog Day bucket. To date, no confirmation hearings have been scheduled, as President Biden has yet to officially appoint a nominee.  BUT, that nomination should come some time in February – if not during the President’s State of Union address, which is scheduled March 1st – and this will kick off a robust debate (and political battle) that we have all experienced multiple times before.

UPDATE: On Feb. 25th, President Biden nominated DC Circuit Court Judge Ketanji Brown Jackson to replace retiring Justice Stephen Breyer. This nomination kicks off Senate confirmation hearings that will take place throughout March/April. At this point, there does NOT appear to be a partisan-battle brewing. However, you can never-say-never.


Legislative Update

The BBBA “Is Dead”…Long Live a “Skinny” BBBA?

  1. In mid-January, Sen. Manchin (D-WV) publicly stated that the BBBA “is dead.” To be clear, that statement was referring to the House-passed version of the BBBA. So query, will the BBBA be revived? As I discussed in my last 2 updates, could we see a “skinny” BBBA? One that includes all of the provisions that Sen. Manchin supports?


  1. Analysis: In my update I sent out right before Christmas, I said the following when trying to guesstimate what might happen come January 2022:


  1. On the one hand, progressive Democrats balk at agreeing to all of the areas of the BBBA that Sen. Manchin supports, and the pressure and the ill-will directed toward Sen. Manchin pushes Sen. Manchin to switch parties (by becoming an Independent and caucusing with Republicans). In this universe, the BBBA is dead.


  1. On the other hand, progressive Democrats realize that they have NO other choice but to agree to Sen. Manchin’s wishes, and progressives agree to the “type” of BBBA that Sen. Manchin supports. Here, progressive Democrats claim victory for, among other things, drug pricing reforms and the extension of the “enhanced premium subsidies”; along with much-needed funding for low- and middle-income families with children through free pre-school; and most importantly, climate change reforms, minus government subsidies for union-made electric vehicles and fees on the oil and gas industry. In this universe, the BBBA is enacted and Congressional Democrats go into the mid-term election season with a full-head of steam.


Right before Christmas, I also said this:

  1. If Congressional Democrats and the Biden Administration want to enact the BBBA at least in some form, it is advisable to move forward with parts of the BBBA that Sen. Manchin supports, which include, among other things, (1) extending a “means-tested” Child Tax Credit; (2) offering “means-tested” free pre-school funding; (3) extending the enhanced premium subsidies, but NOT making the premium subsidies available in Non-Medicaid Expansion States; (4) certain climate change reforms, but NOT things like government subsidies for certain electric cars or a fee on methane emissions; (5) allowing the government to negotiate the price of prescription drugs; and (6) even tax increases on corporations and high-income earners. Recent reports about “revived” negotiations over the BBBA actually talk about all of these “parts” – or “chunks” – that Sen. Manchin supports serving as the four-corners of a newly remade “skinny” BBBA. Soooooo, at least for now, it appears that progressive Democrats ARE INDEED agreeing to Sen. Manchin’s wishes, as noted above. That does NOT mean that even a “skinny” BBBA will get through both the Senate and the House. Only time will tell. Which begs the question:  When might we see a Ground Hog Day involving ANOTHER debate over the BBBA? My answer:  President Biden is scheduled to give his State of the Union (SOTU) address on March 1st. As a result, I foresee March 1st – and the SOTU address – as being the jumping off point for trying to get a “skinny” BBBA to the President’s desk. More specifically, I foresee President Biden using the bully-pulpit of standing in front of Congress – and the nation – to announce what he believes should be in a “skinny” BBBA, and the President will direct both progressive and moderates to “finally get it done.” Then, Senate Leadership will present a newly re-written “reconciliation” bill to the Senate Parliamentarian (which, for some parts of this newly re-written bill, Democratic staff has already “pre-conferenced” with the Parliamentarian), and efforts to pass this “skinny” BBBA will begin in earnest, with the goal of getting the bill to the President’s deck by Easter recess (which starts April 11th, with Easter being April 17th this year). Just like always, however, I am sure this date will slip, so this Ground Hog Day could last all the way until…dare I say it…the end of June (which would be CRAZY, but nothing is ever unexpected in DC these days).


If a “Skinny” BBBA Is NOT Enacted, What Might Happen to the Record 14.5 Million Exchange Enrollees?

  1. Shortly after the 2022 “open enrollment” (OE) period ended on Jan. 31st, CMS announced that a record 14.5 million consumers enrolled in an ACA Exchange plan.  Just to give you perspective, the previous high was in 2016 at 12.7 million.


  1. Analysis: What drove this record enrollment number? As you all know, at the end of January 2021, President Biden announced the COVID SEP, essentially allowing any consumer to enroll in an ACA Exchange plan through Aug. 15, 2021.  Some States even extended this SEP through the end of 2021. In response, about 2.5 million consumers enrolled in an Exchange plan during the COVID SEP. These 2.5 million consumers were then re-enrolled in an Exchange plan during 2022 OE. As you are also fully aware, Congress effectively increased the ACA’s premium subsidies and allowed individuals and families with income above 400% of FPL to access a premium subsidy for 2021 and 2022. In response, millions of new consumers were attracted to the ACA Exchanges on account of the enhanced premium subsidies, effectively adding to the 2.5 million re-enrollment number. And viola – 14.5 million Exchange enrollees.


So What Now?

  1. Okay, so the COVID SEP is over. AND, the enhanced premium subsidies are scheduled to go away at the end of 2022.


  1. Analysis: You don’t have to be a policy analyst to conclude that if the enhanced premium subsidies ultimately expire, this record 14.5 million Exchange enrollment number is going to take a BIG hit. Maybe not in 2022, but certainly in future years as those consumers who benefited from low-cost – and even $0 – Exchange plans will find it difficult to continue to afford health coverage. Practically speaking, this would NOT be good for those consumers who enrolled in an Exchange plan during the COVID SEP and the 2022 OE. Politically speaking, this would be TERRIBLE for Congressional Democrats or the Biden Administration. Congressional Democrats and the Biden Administration know this, which is why they have been TRYING to extend the enhanced premium subsidies past 2023. Not only to help consumers hold on to their coverage – BUT – to save themselves from some SERIOUS political fall-out if the enhanced premium subsidies are NOT extended. The problem for Congressional Democrats and the Biden Administration is that an extension of the enhanced premium subsidies is embedded in the House-passed BBBA, which is now “dead.” And, even if an extension of the enhanced premium subsidies is included in a “skinny” BBBA (which it will), there is NO guarantee that a “skinny” BBBA gets through the Senate and the House. What happens if a “skinny” BBBA also craters like the House-passed BBBA did? Congressional Democrats would have to pivot and TRY to extend the enhanced premium subsidies (1) on a stand-alone basis OR (2) through some other legislative vehicle. Either option will NOT – I repeat NOT – be easy. Soooooooo, that means that WITHOUT the enactment of a “skinny” BBBA, the prospect of extending the enhanced premium subsidies looks bleak. And so does future Exchange enrollment numbers. BUT, Exchange enrollment could go the other way if a “skinny” BBBA can ultimately make its way to the President’s desk. Importantly, the Congressional Budget Office (CBO) has indicated that if the enhanced premium subsidies are extended through 2025, we could see millions more consumers enrolling in an Exchange plan, on top of keeping the existing record 14.5 million Exchange enrollees. Call me Captain Obvious when I say: The stakes could NOT be higher for consumers, stakeholders in the Exchange markets, and ACA supporters. We could see a BIG drop-off in Exchange enrollment if the enhanced premium subsidies are NOT extended. While we could see another BIG spike in Exchange enrollment if the attractive subsidies stick around.


COVID Update

The Federal Departments Update the Guidance Requiring Insurance Carriers and Self-Insured Plans to Pay for COVID Tests

  1. In my last update, I summarized the Biden Administration’s guidance that required insurance carriers and self-insured plans to pay for “over-the-counter” (OTC) COVID tests.


  1. Analysis: In short, these payers must pay for up to 8 COVID tests per participant, plus their dependents (if any) each 30-day period. It does NOT matter if the COVID test was requested by a physician. It only matters if the COVID test was purchased because the participant and their dependents (if any) wanted to “individually” find out if they are COVID positive or not. The guidance (issued on Jan. 10th) went on to explain how carriers and plans can actually pay for the OTC COVID tests. First, these payers could require participants to submit a claim through the normal channels for filing a health claim – along with the receipts for the cost of the tests – and the payer would subsequently reimburse the participant for their out-of-pocket expense. Reports indicate that a number of insurance carriers – as well as some self-insured plans – are opting to require their participants to submit a claim for reimbursement. In these cases, these payers are creating a detailed form that a participant must fill out and submit on-line or through fax or the mail. The Jan. 10th guidance also informed payers that they could set up a DIRECT payment program with an in-network pharmacy or retailer. Here, the participant pays NOTHING for the test.  Instead, the payer pays the in-network pharmacy/retailer for the cost directly. To incentivize payers to adopt a DIRECT payment program (because the Administration does NOT want participants paying for their COVID test out-of-their-own-pocket), the Federal Departments fashioned a rule that limited the cost of a test sold by an out-of-network pharmacy or retailer to $12 per test. The intent of this limit is to mitigate price-gouging by pharmacies and retailers that the payer does NOT have a relationship with. But to me, the Administration is really saying: “If payers do NOT opt for a DIRECT payment program, they expose themselves to the risk of getting fleeced by out-of-network pharmacies/retailers, and we (the Administration) are NOT going to protect you (the payers) unless you protect participants.” Reports indicate that to date, only a few carriers and self-insured plans have adopted this DIRECT payment program option.


What Did the Updated Guidance Say?

  1. There was a weird quirk in the Jan. 10th guidance, which indicated that even if a payer opted for the DIRECT payment program, the payer would NOT be able to enjoy the $12 limit if the payer did NOT actually make a DIRECT payment for a COVID test (because, for example, the in-network pharmacy/retailer did NOT have any tests on hand due to a shortage of tests). That did NOT go over well with the payers.


  1. Analysis: As a result, the updated guidance indicates that even in cases where there is a shortage of tests – thereby preventing a payer from actually making DIRECT payments under their DIRECT payment program – so long as the payer DID INDEED adopt a DIRECT payment program, the payer would STILL be able to limit tests sold by out-of-network pharmacies/retailers to $12. Soooooo, that resolves this quirk. Interestingly, this updated guidance clarifies that the total cost of a COVID test includes “shipping costs and sales tax,” which means the actual cost of a test sold by an out-of-network pharmacy/retailer will be limited to something less than $12 (although the overall cost-limit is still $12). Also, interestingly, even if a payer adopts a DIRECT payment program, the payer is required to “cover reasonable shipping costs related to the COVID test.” That means the payer could by paying MORE than $12 for a test purchased from an in-network pharmacy/retailer. Another nugget: To combat instances where a participant buys a COVID test on the “black market” of sorts, the guidance tells payers that they are NOT required to reimburse the cost of a test purchased from “a private individual.” Also, to combat the re-sale of tests or the use of E-Bay-type web sites where people can bid on purchasing a test, the guidance tells payers that they do NOT have to reimburse costs in these cases. Furthermore, to ensure verification that the purchase of a COVID test is legit, the guidance allows payers to require “reasonable documentation of proof of purchase,” a UPC code or other serial number, or an original receipt showing the test was sold by a pharmacy or retailer. Lastly, another measure to prevent people from “gaming the system” (actually, this measure is trying to save participants from themselves), the guidance explains that participants who receive a reimbursement for the cost of the COVID test from the carrier or plan CANNOT also turn around and seek a tax-free reimbursement their FSA, HRA, or HSA. Ummmm, you can’t get reimbursed more than once for the same medical expense. While this is a no-brainer to you and me, the guidance encourages payers to “advise participants not to seek reimbursement from their FSA or HRA for the cost of the COVID test paid or reimbursed by the carrier or plan.” Also, “don’t use your FSA or HRA debit card to purchase a COVID test if you intend to seek reimbursement from the carrier/plan.” And, if a participant takes an HSA distribution to cover the cost of the test that was already reimbursed, the participant “must pay taxes on the distribution or repay the $$ to the HSA.”