Distributors Descend on Capitol Hill for HIDA Washington Summit

HIDA Government Affairs Update

By Linda Rouse O’Neill, Vice President, Government Affairs

More than 70 HIDA members and their manufacturer partners went to Washington, D.C., in early June to educate lawmakers on key issues affecting the healthcare supply chain. Attendees at the annual HIDA Washington Summit conducted 130 Capitol Hill meetings, including twice as many with members of Congress than in 2017.

Participants reported productive discussions with lawmakers and their senior staff who sit on key committees that influence the healthcare supply chain, including the Senate Finance, Armed Services, and HELP (Health, Education, Labor, and Pensions) Committees, as well as the House Ways and Means, Energy and Commerce, and Armed Services Committees.

Meetings focused on a number of key topics, including pandemic preparedness, purchasing rules under the FY2018 National Defense Authorization Act, and international trade policy. Here is a look at some of the key topics members discussed with their elected representatives:

Pandemic and Emergency Preparedness
In their meetings on Capitol Hill, Summit participants educated policymakers on the supply chain’s role during public health events, like the recent hurricanes in Puerto Rico and Texas. Distributors also explained that the healthcare supply chain is extremely lean, and ongoing efforts are needed to ensure greater elasticity when epidemics or disasters occur that strain available inventories.

HIDA members’ conversations came at a key time as lawmakers work to reauthorize emergency preparedness legislation. The Senate’s Pandemic and All-Hazards Preparedness and Advancing Innovation Act (PAHPAI) of 2018 contains a number of measures that recognize the important role of the healthcare supply chain. These include:

• Provisions that underscore the value of public and private sector coordination during an emergency.
• The requirement that ancillary products needed to deliver medical countermeasures are incorporated into the Public Health Emergency Medical Countermeasure Enterprise planning process.
• The request to the Secretary of Health and Human Services (HHS) that manufacturing capacity and outside sources of medical supplies are considered when replenishing the Strategic National Stockpile (SNS).

HIDA members shared their support for these key provisions, and detailed how the passage of PAHPAI would strengthen their ability to work with federal and local governments during a crisis. In addition to seeking PAHPAI’s passage, HIDA members also value the development of transparent communication pathways between public and private partners, as well as the establishment of stable funding to support training, planning, and stockpiling efforts.

The National Defense Authorization Act (NDAA)
Under the NDAA, the U.S. General Services Administration (GSA) is tasked with reforming the system under which federal departments and agencies acquire commercial products. A key part of this reform is to expand the range of products acquired through e-commerce platforms. Unfortunately, this legislation did not receive public comment and lacked both Congressional review and regular order oversight.

HIDA members explained to legislators that medical products are unlike most other goods that the federal government buys, and are not always suitable for purchase online. Mistakes made during the purchase of medical goods can risk patient safety and create liability. In their conversations with lawmakers, HIDA members raised the following concerns:

• Mistaken delivery of medical products could delay critical patient surgeries or procedures, and would needlessly put patient lives at risk.
• Many medical items have specific storage and handling requirements. The integrity of these goods can be negatively affected by the number of times they have been shipped and handled, by the environments to which they are exposed, and by co-mingling them with non-medical freight.
• Department of Defense and Veterans Affairs hospitals rely on stable sources of supplies, as well as the vital infrastructure supplied by their distributor partners. Many suppliers have employees based in these provider facilities to manage logistics and ensure products get to where they are needed on time.

While recognizing the importance of a streamlined government acquisition process, HIDA members reminded lawmakers that the procurement and contracting process for healthcare goods is unique. They added that distributors have long been proactive partners in helping to streamline this process. Through collaborations like the Prime Vendor Program, for example, suppliers are able to incorporate best practices from the commercial marketplace into the federal government’s acquisition process.

International Trade and Tariffs
Many participants also spoke to members of Congress about the negative impact proposed tariffs could have on healthcare. The healthcare supply chain for the U.S. is both global and complex. Vital equipment and parts from oversees support all aspects of medical care, from routine wellness visits to lifesaving operations.

In addition to raising the cost of healthcare, these tariffs could also impair ongoing emergency preparedness efforts, distributors warned. As of June 15, certain medical and ancillary products were included in the $50 billion in tariffs the U.S. has imposed on China, such as electrocardiographs, sterilizers, X-ray machines, and surgical instruments.

Additional Policy Speaker Takeaways
The second day of the Washington Summit featured lawmakers and experts who shared their insider perspectives on various political and industry issues. Among some takeaways:

The private sector has a lot to offer for pandemic and emergency preparedness efforts. Dr. Robert Kadlec, Assistant Secretary for Preparedness and Response, HHS, discussed various challenges faced both during and in advance of national emergencies. He praised commercial supply chain expertise, adding HHS plans to take steps to incorporate additional opportunities for private sector engagement and collaboration to continue improving U.S. preparedness capabilities.

Efforts to eliminate the Affordable Care Act (ACA) are unlikely in the near future. Citing the upcoming midterm elections, and the popularity of certain components of the health law, several Democratic and Republican Chiefs of Staff believe it is unlikely Congress will attempt another ACA repeal in 2018. Expressing concern about the rising cost of healthcare to federal payers, policy experts commented that further reform to the healthcare system would be politically difficult without broad public support.

HIDA regularly advocates for distributors through regular meetings with lawmakers and partnerships with federal agencies year round. If you would like to get more involved, or would like more information about the HIDA Washington Summit, please contact us at HIDAGovAffairs@HIDA.org.