2021 is here, and the Biden administration is in full swing in Washington. What’s the state of healthcare policy inside-the-beltway and out in the states? During this episode, get a behind the scenes look at CHPA’s policy priorities and the role that the new Congress plays in shaping healthcare from CHPA’s Federal Government Affairs Vice President Marc Schloss and Director Taylor Holgate.
- Episode Transcript
Anita Brikman: 2021 is here, and the Biden administration is in full swing in Washington. What's the state of healthcare policy inside the beltway, and out in the States? During this episode get a behind the scenes look at CHPA's policy priorities, and the role that the new Congress plays in shaping healthcare, from CHPA’s Federal Government Affairs, VP Marc Schloss, and Director Taylor Holgate.
Welcome to CHPA Chat, conversations in the consumer healthcare industry with Anita Brikman.
Anita Brikman: Welcome folks to CHPA Chat. I am joined by one dynamic duo, Marc Schloss, Vice President of Federal Government Affairs at CHPA, and Taylor Holgate, Director of Federal Government Affairs, our federal GA team. Hey guys.
Marc Schloss: Hi, Anita.
Taylor Holgate: Good to talk to you today, Anita.
Anita Brikman: All right, so for the record, we are recording this on February 26, and as we all know, things can move at lightning speed in DC, or not. So what do you think is ahead? Marc, let's start with you.
Marc Schloss: Well, thank you, Anita. An under-reported story of the 117th Congress is that this is one of the Congresses with the narrowest majorities in both the House and Senate. In the house there were only about five vote margin between Republicans and Democrats, which means on any vote, Democrats can only lose five of their own members of their own party and still see legislation pass, if legislation, as it is these days, is partisan, whereas Republicans don't join Democrats and vice versa on major pieces of legislation. And in the Senate, it's even tighter, you have a 50/50 Senate, with 50 Republicans and 50 Democrats, which means any one democratic Senator who doesn't vote for a piece of legislation could imperil any legislation that has a 50 vote threshold, like budget reconciliation, which in the beginning of 2021 has been the buzzword on Capitol Hill.
So party cohesion is really the name of the game in Washington these days. When we get into the latter part of 2021, and other pieces of legislation move by "regular order," then there will be horse trading to try to get ten Republican senators on board with any bill that passes out of the House in its slim majority. So again, party cohesion is the name of the game, and makes it so the politics in Washington are more partisan than they've ever been in our most recent history.
Anita Brikman: So what does that mean, Taylor, for legislation actually making it through?
Taylor Holgate: It means legislating is really challenging. Both the Republicans and the Democrats are trying to just stick together when it comes to voting on things, but they're also grappling with major philosophical differences within their own ranks, and we'll see that influence how legislation comes about, and what kinds of things can pass. The split within the parties isn't a new thing, we saw it a lot during the presidential election, you had more progressive wing of the democratic party, you had the more moderate wing of the democratic party. And now, as Marc said, with their very slim majority, they've got to find a way to govern, and everyone's focused on coronavirus and economic situation right now, but I think as we move forward, we're going to see more and more of those differences bubble up in a public way that influences legislation.
On the other side you've got the Republicans grappling with, how do we move on from the last president? Is the Republican party still the president of Trump? Is it some different version that looks back to the pre-Trump era, or moving on without Trump, and those questions aren't answered yet, but it's clear that there's a deep division within both parties, and that's going to influence what legislation looks like, and it's going to limit the pool of ideas that can get enough votes to move across the finish line.
Anita Brikman: Marc, I don't think it's an assumption to say that many more moderate, or at least fiscally moderate folks, may have voted for President Biden. How is he going to balance how he campaigned with the more progressive wing of the party?
Marc Schloss: Decades ago, back when I was a Senate staffer, the parties had a structure in place that there was actually a benefit to work across the aisle. Senators and members of Congress used to run ads noting their bi-partisan chops. These days there is much less of a benefit to going back home and campaigning on working with the other party. There are fewer and fewer seats that are now in play, and when I say in play meaning that could go to the Republican or you go to the Democrat. Most state legislatures now draw congressional districts with one party in mind, and you see many districts that are plus 22 Democrats to Republicans, or plus 30 Republicans to Democrats. So there are fewer and fewer members of Congress out there who have a vested interest in legislating and working across the aisle.
You have a series of Democrats and Republicans who won this past November and the first thing they did was hire a bunch of press secretaries and communications directors to try to get them on TV, and maybe only one or two legislative staff. And what does that mean? It means that there is a benefit structure built in Washington right now to make yourself a celebrity, and not to make yourself a legislator, and that provides many challenges for folks who want to get legislation done and want to make progress. And because of that, you have less of an interest in folks working across the aisle.
There are some who certainly are from districts and from states where this is increasingly an issue, folks represent a lot of states that are hurting right now based on the pandemic and need assistance, but that's not how people win primaries, and that's not how people get reelected, which at the end of the day is the name of the game in Washington. It becomes a big challenge, and it makes it so industries like ours that are not partisan, that are not controversial, have a struggle to try to find champions who want to be serious legislators and not those who want to make sure that they are on primetime TV that night on their favorite cable channel of choice.
Anita Brikman: So let's talk about some CHPA priorities. Let's start with you, Taylor, what are you working on on behalf of CHPAs members?
Taylor Holgate: We're really excited to continue to work on HSA FSA legislation. We were so excited that the HSA benefit was restored about a year ago in one of the coronavirus aid packages, so it opened up the door for consumers to use those benefits on the medicines that they can pick up off the shelf to stay healthy during the pandemic. And we're looking long-term forward about how do we increase the self-care options that are available to consumers through health savings accounts and flexible spending arrangements?
Anita Brikman: So let's talk about CHPA priorities this year. Taylor, you want to kick us off?
Taylor Holgate: Yeah, so I'm really excited to work on expanding the universe of self-care options that are available through HSA FSA account. We're so excited to see OTC medicines and menstrual care products get included in the HSA FSA eligibility list in the last CARES package, and we think that that opens the door for bare conversation about what self-care is right now, is that the best version of self-care for American consumers? And we think we have a really strong case for dietary supplements and for different categories of consumer medical devices moving forward.
Additionally on dietary supplements, we're also working on CBD and the regulatory challenges around, how does FDA deal an ingredient that only became legal for farming a couple of years ago and now is existing in this gray area where there's this surge of consumer demand, but the regulations haven't kept up. So we're also working on that from both a legislative and a regulatory perspective, looking for ways how we can move that issue forward and make sure consumers end up having confidence in the products on the shelves at the drugstore.
Anita Brikman: Makes a lot of sense. Marc, we hear a lot about Buy American, made in America. How do those slogans apply to our members and the supply chain that's necessary to get safe consumer healthcare products on store shelves?
Marc Schloss: Well, thank you, Anita. What you just brought up is the perfect example of what we call good politics and bad policy. Everybody supports Buy America, everybody supports buying products that are made in America by American hands, and we are really proud of our footprint. Our industry has roughly 1000 domestic manufacturing sites from coast to coast, and we're proud of our products on American shelves by American workers.
What we've seen from the larger pharmaceutical supply chain, however, is that we live in a globalized world. It's a small world, and many ingredients specifically are just not available on shore, and many products that are very popular, that are on medicine cabinets and store shelves across the country, come from foreign sources made with American hands. We are hopeful that this new administration is going to acknowledge that we do not want to limit American choice by limiting the API, the ingredients, that come from foreign sources. We are certainly very open to new ways to look at incentivization for more onshoring, but again, we're very pleased and very proud of our members' footprint coast to coast, but understand that if you limit the availability of ingredients, it's going to make it more difficult for some products to remain on store shelves.
There was recently an executive order that was not dissimilar from the executive order that President Trump submitted late last year. The difference in the executive order is the transparency. So right now there will be a public facing website so the American consumer can understand, are the products that they purchased made in America? And similarly, this new administration understands that there are going to be elements of products that might come from abroad, but all we can do is our level best to ensure that, to the extent practicable, American jobs are going to be protected.
Anita Brikman: What about the issue of quality? I know, in conversations I've had with our members, who are the best of the best of the consumer healthcare products industry, but there are counterfeits out there, and in the online marketplace, it can be really difficult to tell what's the real deal.
Marc Schloss: Absolutely. One of the reasons why we worked so hard for many years on OTC Monograph reform is to beef up the ability of the Food and Drug Administration to oversee products coming to market. For the first time ever we are paying user fees, and those are user fees that we came to FDA with, because we want FDA to have the appropriate oversight to ensure patient safety, and that the consumer understands fully what they're purchasing. This is wholly undercut by counterfeits and misbranded, mislabeled products sold on third-party websites.
So we're part of a very active coalition, the Buy Safe America Coalition, that is working on two different pieces of legislation, and they're very common sense legislation that protect the consumer. One of them is the Informed Consumers Act, and what the Informed Consumers Act simply does is it requires those selling on third-party websites to be actual individuals. Right now anybody can go onto one of these websites and put in fraudulent or not up-to-date information about the seller and sell on these websites, and if there is an infraction, it's hard to chase down exactly who that individual is. So what this bill does, it requires a tax ID number and verifiable information so we understand who is selling this information, so there's accountability.
There's another piece of legislation, the Shop Safe Act, but the Shop Safe Act takes it to another level and says that you have a three strike and you're out penalty. So if you are found to be selling fraudulent products, the third time you're found to have been doing so, you're de-platformed, you're no longer able to sell these products online. Again, we think that these are balanced and common sense pieces of legislation that are supported by dozens of manufacturers, dozens of retailers. Because again, we like everyone else is hearing from the retailers that this is becoming a very large issue, that products are being stolen from warehouses, from pharmacies, and yes, from online retailers that are now reselling these products, and the consumer has no confidence, in many cases, of what they're buying. And as we always say, buyer beware, if you think a deal is too good to be true, it very well could be, because of the proclivity of these online retailers.
Anita Brikman: And in our industry this is so important because we are so committed to consumer safety. I mean, maybe you get some counterfeit Tupperware it's no big deal, but when we're talking about medicines that people use for their families, it's unacceptable.
Marc Schloss: And that has certainly gotten the attention, to your point, Anita, of Capitol Hill. There is certainly a concern on Capitol Hill for fraudulent flat screens. Or I say fraudulent, but flat screens that are boosted off the back of a truck and resold. There was a hearing last year where they had bikes helmets that were fraudulent, and they just had the name of a major manufacturer on the side, but they did testing in the hearing room, people jumping on top of these helmets, and they collapsed. So there were a lot of people online buying these products off questionable websites, and these are not legitimate products. Not to mention products that you ingest or you give to your children, you give to your family, that could lead to significant medical events.
Anita Brikman: Let's take a step back and look at the healthcare ecosystem as a whole. Looking at this administration and this Congress, do we see major changes in healthcare policy coming our way? Taylor, do you want to start with that?
Taylor Holgate: Legislating on healthcare is always complicated, and it's hard to rally enough members around the position to get it across the finish line. We saw this in the last few years when the Republicans had control of both houses of Congress and the White House, they ran their entire campaign on getting rid of the Affordable Care Act, and in the end they weren't able to do it. And now the Democrats are governing with an even slimmer majority, coronavirus is sucking up a lot of the energy right now, but I think this larger philosophical conversation that took place during the democratic presidential primary about, should America have Medicare for all? Or should we just make some upgrades to the Affordable Care Act system? We're going to see that play out in Congress at some point, and there's not a clear consensus around either view.
So once Congress gets through the coronavirus stuff, I think we'll start to see more of those conversations happening in public, once the Biden administration has more of their appointees in place, and the immediate crisis of coronavirus is maybe a little bit further in the rear view mirror.
Anita Brikman: That'll be a great day, won't it? Marc, what's your take?
Marc Schloss: Healthcare is 18% of our economy. It is not something that should be done in a partisan lens. In 2009 the Democratic party, in passing the Affordable Care Act, did so with a lot of Republican ideas, but with only democratic votes, with the exception of one or two Republicans voted on procedural grounds, along the way in the House, otherwise it was a partisan process with, again, some Republican ideas included that you could argue were significant or insignificant in some cases. In order for healthcare to be revisited in Congress, it's going to require, to my earlier point, a structure in place where there is the voter who is really rewarding a politician with their vote for working across the aisle. Again, we're seeing that less and less and less, and therefore our healthcare policy is very much getting affected by it in a very negative way.
What we've seen right now with the reconciliation bill that will pass likely in the first quarter of this year, is being done so because they can't get consensus around many healthcare provisions and they have to do it under budget reconciliation in a wholly partisan way. It is not the way to legislate, I don't think anybody would agree that it's the way to legislate, but the status quo is also unacceptable. So unfortunately I think what you'll see is some tinkering around the edges on ways to strengthen the Affordable Care Act, which is not going away, but not doing so in a comprehensive manner that is going to remedy elements that even partisan Democrats would say needed to be fixed in the Affordable Care Act, and that is only going to mean the opportunity for less improvements in healthcare. Again, it's all really tied back to redistricting, it's tied back to the balance of Congress, and it's tied back to the fact that the voter is not rewarding the politician in Washington, DC for making positive political policy decisions, that the policy is losing out to the politics.
Anita Brikman: And on that point, we've heard from people, I know even in my own family, where they feel very disconnected from Washington, DC and the business of politics as a whole. You're saying the voters are the ones who are rewarding politics over the best policy. How do we change that? People say they don't trust what's happening in Washington, DC as reflecting their interests, yet the partisanship continues. Maybe that's a bit of a convoluted question, and probably too hard to solve on a podcast, but what do we do about that, where large swathes of the country feel disconnected from the making of law and the governing of this nation?
Marc Schloss: There are millions and millions and millions of Americans who don't feel like their voices are being heard. This is nothing new. This is how the Tea Party started in 2008, 2009, when you had millions of Americans, and in this case, mostly on the right, who felt like their voices were not being heard. The Trump campaign, the Trump phenomenon, was born out of millions of Americans who felt like career politicians were not heeding their concerns, were not listening to them. Right now you have a situation in place where you have both parties that are very much at conflict with each other, but you have to remember, who votes in party primaries? In many cases party primaries to select nominees only have eight, 10, 12, 15, sometimes 20% of those eligible voters voting. So you have party primaries that are selected by thousands of people, that therefore can make the decisions for millions of people.
Two great examples. One is Alexandria Ocasio Cortez in New York City. AOC, as she's known, is very much viewed by some as the heartbeat of the progressive left. She won her first primary with, I think it was three or 4,000 primary voters, and then she went on to win the general election in her district, because it's a overwhelming Democratic district. Marjorie Taylor Greene, who some will say is the heartbeat of the conservative movement on the right, won her primary in Northwest Georgia with a few thousand votes as well, because she got the backing of President Trump. Now, if you're in Washington, DC you understand that AOC and Marjorie Taylor Greene will have a zero say over the direction of many votes on the House floor, but most people see them as the de facto leaders of both parties, for better or for worse. That does not engender policy being moved on House of Representatives floor.
What we have been aiming to do in our industry is trying to identify those lawmakers, the ones who don't care about the headline, who care about making a positive change, to really carry our issues. But when you're talking to your families back home, they don't know necessarily who those members are, they know who the big names are, and the big names are the ones who win their party primaries in very partisan districts, and that is what we need to get at. We need to change how we elect our leaders, we need to make sure that we have elected democracy.
There are very few States where the same percentage of Democrats and Republicans reflect the same number of House members. Pennsylvania has more registered Democrats than Republicans. It's, I believe, 55 to 45 if you break down the difference between Democrats and Republicans, yet the Commonwealth of Pennsylvania has many more Republican members of Congress than Democratic members of Congress. And you ask, well, why is that the case if more folks in the state are Democrats? It's because of the way that they draw the lines. And 10 years ago when they drew the lines in Pennsylvania, they drew them with Republican advantage. So it doesn't reflect the will of the majority of the population, it reflects how those congressional districts were drawn. That's what we need to change. We need to make sure that people's voices are heard in Washington, and they're not because we do not have a representative democracy based on demographics.
Anita Brikman: Taylor?
Taylor Holgate: Anita, I think Marc hit on a really important point on Marjorie Taylor Greene and Alexandria Ocasio Cortez. These are really well known, but really junior members of an institution that has functioned for a very long time on seniority. So the dynamic has changed where in the past, members of Congress may need the support of the mainstream folks in their party in order to mount a competitive primary challenge, but we're seeing with social media that people who previously were outside of the mainstream are now able to build up a following, win a primary, and ultimately make it to Congress. I think, as a self-care advocate in my current role, it's not for me to say that this system is wrong, but rather that this is the system that we have, so how do we accomplish our goals in this system?
We recognize that things are changing, but the needs of our membership and the needs of our industry are still there, and we want to be constructive bipartisan voices, so how do we move forward? And I think some of that is knowing, when is a public debate worth engaging in, and when is it not? And there's a lot of conversations out there that get a lot of attention from the Washington Insider crowd on Twitter that are just, they're not appropriate for us. And recognizing that politics is about so many other things, but we need to keep a really careful eye out for the opportunities where we can be a constructive with our industry and not get distracted in everything else that's flying around out there.
Anita Brikman: Well, I know I am, and certainly our members, are so grateful for everything that you guys do in really advancing the priorities of a very important industry for the nation, for the individual consumer. Self-care has never been a bigger part of healthcare than it was during COVID, when people had to rely on the medicines they had at home. So I know our members are appreciative, and I know how much you both have been doing in the virtual world, but aren't you guys ready to get back to Capitol Hill?
Taylor Holgate: I got a long list of lunches. Someday when things are, it's starting to change a little bit now, I was able to go see a couple of folks in person this week, I think that we'll see more and more of that is the vaccines become available to a wider range of people, but people are ready to get back in person, everyone's had enough of Zoom.
Anita Brikman: Same for you, Marc?
Marc Schloss: Absolutely. Our ability to really help our members is based on relationships on Capitol Hill, and those relationships are born out of meeting people, and out of being able to see them face to face. I would say, though, that we have adopted, like the rest of the world has adapted, and in some cases we've been able to be even more able to meet the needs of the industry, because we can jump on a Zoom with a member of Congress, with staff, we can bring members of different parts of the country together on a Zoom call, as we've been doing with members of Congress, to tell our story, to hear from them on their priorities. And because of that, it's enabled us to work in a new, and in many, many cases, a quicker way, that we can just click a link and you're there, click a link you're on Capitol Hill.
Marc Schloss: We can do what we would do once or twice a year with fly-ins, with folks coming to DC, through a computer screen. And in a way, it has been somewhat more beneficial than had we not gone this route. I don't think, though, this is the wave of the future, I think members of Congress, I think folks are going to want to get back together soon, and hopefully with the vaccines we'll do that sooner than later. But just in terms of the sheer ability to get work done in a timely manner, there have been some benefits to this new online world that we have all created, of course when we remember not to unmute ourselves, of course, but when we press the unmute button, we have been able to work in many respects in a much quicker and more strategic manner.
Anita Brikman: Well, I will say that the silver lining of all of these virtual meetings is that I've gotten to see your kids repeatedly, Marc, as they make guest appearances during a meeting, and I think I've seen at least one of your foster puppies, Taylor, maybe a couple of them.
Taylor Holgate: Yeah, I've had a couple of foster dogs. It's both a little bit sad and a little bit encouraging, you can't hang on to a foster dog very long right now because so many people are interested in adding four paws to their family. So I enjoy having them while they're here, and I'm always happy for them when they can find a permanent home.
Anita Brikman: That is awesome.
Marc Schloss: I think, again, having everybody in everybody else's living room has made it a little more personal than it ever had been. Certainly, I've had my run-ins with kids running through the screen with folks on Capitol Hill on the phone, and I think them seeing in another light is never a bad thing, but I would probably echo millions and millions and millions of parents around the country when I say, we're very excited that schools will be open next month, and they will be going to in-person hybrid learning for at least the balance of this academic year.
Anita Brikman: And that is a great note to end on Marc, Taylor. Thanks for joining me.