In this update:
- Administration Updates
- Trump Administration Announces Tariffs on Mexican, Canadian, and Chinese Imports
- DOGE Accesses HHS and CMS Data Systems
- WSJ Reports Trump Preparing Order for Layoffs at HHS
- Finance Committee Clears RFK Jr. for Floor Vote
- Legislative Updates
- Bipartisan Group Introduces Legislation to Increase Medicare Physician Payments
- Federal Agencies
- CMS Releases Statement on Prescription Drug Program
- CDC Data Shows Increases in Black Maternal Mortality
- NSF Issues RFI on AI Action Plan
- CDC Removes Databases and Information on Sexual Identity, Gender Orientation and HIV
- Other Updates
- Moody’s Downgrades Insurers’ Credit Outlook
- New York State Updates
- Governor Hochul Signs Legislation to Protect Identity of Medication Abortion Prescribers
- DFS Issues Guidance to Health Plans Regarding Prior Authorization Prohibition for PrEP
Administration Update
Trump Administration Announces Tariffs on Mexican, Canadian, and Chinese Imports
On February 1st, the Trump Administration announced executive action to impose new tariffs on the United States’ three largest trading partners: Mexico, Canada, and China. This policy included a 25% tariff on Mexican and Canadian imports, and 10% on Chinese imports. On February 3rd, though, President Trump announced a 30-day freeze on tariffs for Mexican and Canadian goods, following brief agreements with both countries regarding illegal migration and fentanyl trafficking. The Chinese tariffs took effect on February 4th.
Tariffs would be expected to have an inflationary effect on common imported health care-related goods, including pharmaceutical ingredients, finished drugs (including generics), medical devices, and everyday items such as gowns and gloves.
The announcement is available here.
DOGE Accesses HHS and CMS Data Systems
On February 6th, the Wall Street Journal and Washington Post separately reported that members of the U.S. Department of Government Efficiency (DOGE) Service have gained access to data systems within the Department of Health and Human Services (HHS), including the Centers for Medicare and Medicaid (CMS), the National Institutes of Health (NIH), and the Centers for Disease Control and Prevention (CDC). DOGE is reportedly looking for “opportunities for more effective and efficient use of resources,” as well as the technology used by CMS, and the agency’s organizational structure. Trump Administration officials have said that DOGE is “ensuring appropriate access to CMS systems and technology” and that Elon Musk, who leads DOGE, is an “SGE” or “special government employee.”
The WSJ article is available here.
WSJ Reports Trump Preparing Order for Layoffs at HHS
On February 6th, the Wall Street Journal reported that President Trump is preparing to issue an Executive Order (EO) “to fire thousands of [HHS] workers.” The Food and Drug Administration (FDA), CDC, and other health agencies would be required to cut a certain percentage of their workforce. According to the Journal, agency employees have been told to prepare lists of workers still in their probationary period (typically one year, or two years for “excepted service”), who can be let go more easily, and identify which are “essential.”
The WSJ article is available here.
Finance Committee Clears RFK Jr. for Floor Vote
On February 4th, the Senate Finance Committee voted along party lines (14-13) to advance Robert F. Kennedy Jr.’s nomination to the full Senate for consideration. Senator Bill Cassidy cast the deciding vote, citing “serious commitments” made by the Trump Administration since the confirmation hearings last week, including regular meetings between Cassidy and Kennedy, and assurances that existing vaccine safety systems would remain in place. Senator Cassidy’s vote bodes well for RFK Jr.’s overall chances of Senate-wide confirmation.
As a result of pressure from Democratic legislators on the Senate Finance Committee, Kennedy pledged to divest his interest in ongoing litigation against Merck, should he be confirmed. Initially, Kennedy stood to collect 10% of fees awarded in a Wisner Baum lawsuit over the safety of Merck’s HPV vaccine, Gardasil. Should this suit be successful, Kennedy’s sons would receive the fees owed to him.
Legislative Update
Bipartisan Group Introduces Legislation to Increase Medicare Physician Payments
On January 31st, a bipartisan group of Representatives announced the reintroduction of the Medicare Patient Access and Practice Stabilization Act. The bill would prospectively cancel the 2.83% cut in physician Medicare payments that took effect on January 1st, while also providing a 2% payment update to stabilize physician rates. The American Medical Association (AMA) and other stakeholders are pushing for the legislation to be included in the pending government funding package, which must be passed before government funding expires on March 14th. Similar legislation failed to progress during the lame duck session.
The announcement is available here.
Federal Agencies
CMS Releases Statement on Prescription Drug Program
On January 29th, the Centers for Medicare & Medicaid Services (CMS) released a short statement on the Medicare Drug Price Negotiation Program, announcing that the Administration plans to proceed with negotiations for the 15 drugs in the program’s second cycle. The statement affirms the Trump Administration’s willingness to incorporate lessons learned from the program to date, “bring greater transparency” to the program, and “provide opportunities for stakeholders” to offer ideas for improvements. Notably, the announcement reiterates the program as a statutory requirement, leading some to believe that, while the Trump Administration may change the program, it will not block its ongoing implementation. Democratic legislators have voiced concerns over the possibility of pharmaceutical companies weakening the program through further involvement.
The announcement is available here.
CDC Data Shows Increases in Black Maternal Mortality
On February 5th, the Centers for Disease Control and Prevention (CDC) released data showing that the pregnancy-related death rate for non-Hispanic Black women rose from 49.5 to 50.3 per 100,000 live births in 2023. This number is more than three times the rate for women in other racial and ethnic groups. Black women are the only race or ethnic group for which deaths from pregnancy-related causes did not decline from the previous data period. Pregnancy-related death rates for white women decreased from 19.0 to 14.5 per 100,000 live births; rates for Hispanic women decreased from 16.9 to 12.4; and rates for Asian women decreased from 13.2 to 10.7.
The full data set is available here.
NSF Issues RFI on AI Action Plan
On February 5th, the National Science Foundation (NSF) issued a Request for Information (RFI) seeking public input on an AI Action Plan. This action is in response to President Executive Order 14179. This plan’s aim would be to “sustain and enhance America’s AI dominance, and to ensure that unnecessarily burdensome requirements do not hamper private sector AI innovation.” reducing regulatory barriers to private sector innovation. The NSF invites feedback from academia, industry, and other stakeholders on key AI policy areas, including hardware, cybersecurity, AI safety, regulation, and workforce development.
The RFI is available here. Comments are due by March 15th.
CDC Removes Databases and Information on Sexual Identity, Gender Orientation and HIV
In response to a memo from the Office of Personnel Management directing agencies to remove “gender ideology” from their websites, the Centers for Disease Control and Prevention (CDC) removed survey data from the Youth Risk Behavioral Surveillance System (YRBSS). YRBSS is one of the largest, most reputable surveys on American youth, with information on sexual orientation and gender identity. Pages dedicated to the CDC’s Social Vulnerability Index and “Efforts to Address Racism as a Fundamental Driver of Health Disparities” have also been made unavailable.
Other Updates
Moody’s Downgrades Insurers’ Credit Outlook
Moody’s Ratings is downgrading the insurance industry’s credit outlook from “stable” to “negative,” attributing the change to inflated medical costs and stagnant reimbursement from Medicare Advantage (MA) and Medicaid. Moody’s forecasts that spending in the commercial market will increase by 8% this year, the fastest growth rate in 13 years. Within rising costs, Moody’s points to prescription drug spending and higher utilization of behavioral health services. Moody’s also anticipates that legislation targeting pharmacy benefit manager (PBM) margins and Affordable Care Act (ACA) subsidies could spur disenrollment and stretch insurers further.
New York State Updates
Governor Hochul Signs Legislation to Protect Identity of Medication Abortion Prescribers
On February 3rd, Governor Hochul signed legislation (S36A/A2145A) that permits prescription labels for abortion medications (i.e., mifepristone, misoprostol, and their generic alternatives) to include the name of the prescribing health care practice instead of the name of the prescriber at the prescriber’s request. The legislation builds on New York’s shield laws to provide additional protection for doctors prescribing medication abortion to patients in other states. Governor Hochul also announced that she reached an agreement with the Legislature to add a new measure allowing prescribers to request that their practice address be listed instead and to ensure that pharmacies adhere to the new labeling rules. The legislation was approved following the recent indictment of a New York doctor for allegedly prescribing a medication abortion pill online to a patient in Louisiana.
The Governor’s press release is available here.
DFS Issues Guidance to Health Plans Regarding Prior Authorization Prohibition for PrEP
On January 30th, the New York State (NYS) Department of Financial Services (DFS) issued guidance to regulated health insurance plans regarding requirements for coverage of pre-exposure prophylaxis (PrEP) for HIV prevention. Effective December 25, 2024, insurance plans cannot require prior authorization for covered antiretroviral prescription drugs for the prevention and treatment of HIV or AIDS, including PrEP. Plans are required to cover the three FDA-approved PrEP formulations without cost-sharing and are prohibited from using medical management techniques, such as step therapy, to direct individuals to utilize one formulation over another.
The DFS guidance is available here. Questions may be submitted to health@dfs.ny.gov.