Health Care: Constitutional Rights and Legislative Powers

Kathleen S. Swendiman
Legislative Attorney

The health care reform debate raises many complex issues including those of coverage, accessibility, cost, accountability, and quality of health care. Underlying these policy considerations are issues regarding the status of health care as a constitutional or legal right. This report analyzes constitutional and legal issues pertaining to a right to health care, as well as the power of Congress to enact and fund health care programs. The United States Supreme Court’s decision in NFIB v. Sebelius, which upheld most of the Patient Protection and Affordable Care Act (Affordable Care Act/ACA), is also discussed.

The United States Constitution does not set forth an explicit right to health care, and the Supreme Court has never interpreted the Constitution as guaranteeing a right to health care services from the government for those who cannot afford it. The Supreme Court has, however, held that the government has an obligation to provide medical care in certain limited circumstances, such as for prisoners.

Congress has enacted numerous statutes, such as Medicare, Medicaid, and the Children’s Health Insurance Program, that establish and define specific statutory rights of individuals to receive health care services from the government. As a major component of many health care entitlement statutes, Congress has provided funding to pay for the health services provided under law. Most of these statutes have been enacted pursuant to Congress’s authority to “make all Laws which shall be necessary and proper” to carry out its mandate “to … provide for the … general Welfare.” Congress has also used other constitutional powers, such as its power to regulate interstate commerce and its power to levy taxes, to enact legislation relating to health insurance and health care.

In 2010, Congress enacted the Affordable Care Act, a comprehensive health care reform law which includes a requirement, effective in 2014, that most individuals purchase health insurance, and which significantly expands the Medicaid program. A number of lawsuits were filed challenging various provisions of this legislation, and, on June 28, 2012, the Supreme Court upheld the majority of ACA’s provisions. Significantly, the Court upheld the requirement that individuals purchase health insurance as a valid exercise of Congress’ taxing power, but the Court limited Congress’ power to spend for the general welfare by holding that Congress cannot threaten the states with the loss of all federal Medicaid funds if the states decline to expand Medicaid coverage as mandated by ACA.

In addition, several states have passed laws, amended their state constitutions, or entered into interstate compacts to attempt to “nullify” or “opt out” of the federal individual health insurance mandate and other federal health care provisions. Direct conflicts between federal laws and state nullification statutes or state constitutional amendments would raise constitutional issues which are likely to be resolved in favor of federal law under the Supremacy Clause of the United States Constitution.

A number of state constitutions contain provisions relating to health and the provision of health care services. State constitutions may provide constitutional rights that are more expansive than those found under the federal Constitution since federal rights set the minimum standards for the states.


Date of Report: July 9, 2012
Number of Pages: 20
Order Number: R40846
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ACA: A Brief Overview of the Law, Implementation, and Legal Challenges

C. Stephen Redhead, Coordinator
Specialist in Health Policy

Hinda Chaikind
Section Research Manager

Bernadette Fernandez
Specialist in Health Care Financing

Jennifer Staman
Legislative Attorney

In March 2010, the 111th Congress passed health reform legislation, the Patient Protection and Affordable Care Act (ACA; P.L. 111-148), as amended by the Health Care and Education Reconciliation Act of 2010 (HCERA; P.L. 111-152) and other laws. ACA increases access to health insurance coverage, expands federal private health insurance market requirements, and requires the creation of health insurance exchanges to provide individuals and small employers with access to insurance. It also expands Medicaid coverage. The costs to the federal government of expanding health insurance and Medicaid coverage are projected to be offset by increased taxes and revenues and reduced spending on Medicare and other federal health programs. Implementation of ACA, which began upon the law’s enactment and is scheduled to unfold over the next few years, involves all the major health care stakeholders, including the federal and state governments, as well as employers, insurers, and health care providers.

Following the enactment of ACA, individuals, states, and other entities challenged various provisions of ACA on constitutional grounds. Many of these suits addressed ACA’s requirement for individuals to have health insurance (i.e., the individual mandate), and claimed that it is beyond the scope of Congress’s enumerated powers. The expansion of the Medicaid program was also challenged, as state plaintiffs contended that the expansion impermissibly infringes upon states’ rights, coercing them into accepting onerous conditions in exchange for federal funds.

On June 28, 2012, the Supreme Court issued its decision in National Federation of Independent Business v. Sebelius, finding that the individual mandate is a constitutional exercise of Congress’s authority to levy taxes. However, the Court held that it was not a valid exercise of Congress’s power under the Commerce Clause or the Necessary and Proper Clause. With regard to the Medicaid expansion provision, the Court further held that the federal government cannot terminate current Medicaid program federal matching funds if a state refuses to expand its Medicaid program. If a state accepts the new ACA Medicaid expansion funds, it must abide by the new expansion coverage rules, but, based on the Court’s opinion, it appears that a state can refuse to participate in the expansion without losing any of its current federal Medicaid matching funds. All other provisions of ACA, as amended by HCERA, remain intact.

This report provides a brief summary of major ACA provisions, implementation and oversight activities, and current legal challenges. For more detailed information on ACA’s provisions, CRS has produced a series of more comprehensive reports, which are available at http://www.crs.gov. The information provided in these reports ranges from broad overviews of ACA provisions, such as the law’s Medicare provisions, to more narrowly focused topics, such as dependent coverage for children under age 26.


Date of Report: July 3, 2012
Number of Pages: 11
Order Number: R41664
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FDA Regulation of Medical Devices

Judith A. Johnson
Specialist in Biomedical Policy

Update: On June 20, 2012, the House of Representatives passed, by voice vote and under suspension of the rules, S. 3187 (EAH), the Food and Drug Administration Safety and Innovation Act, as amended. This bill would reauthorize the FDA prescription drug and medical device user fee programs (which would otherwise expire on September 30, 2012), create new user fee programs for generic and biosimilar drug approvals, and make other revisions to other FDA drug and device approval processes. It reflects bicameral compromise on earlier versions of the bill (S. 3187 [ES], which passed the Senate on May 24, 2012, and H.R. 5651 [EH], which passed the House on May 30, 2012). The following CRS reports provide overview information on FDA’s processes for approval and regulation of drugs:

• CRS Report R41983, How FDA Approves Drugs and Regulates Their Safety and Effectiveness, by Susan Thaul. 
• CRS Report RL33986, FDA’s Authority to Ensure That Drugs Prescribed to Children Are Safe and Effective, by Susan Thaul. 
• CRS Report R42130, FDA Regulation of Medical Devices, by Judith A. Johnson. 
• CRS Report R42508, The FDA Medical Device User Fee Program, by Judith A. Johnson
  (Note: The rest of this report has not been updated since December 28, 2011.) 

Prior to and since the passage of the Medical Device Amendments of 1976, Congress has debated how best to ensure that consumers have access, as quickly as possible, to new and improved medical devices and, at the same time, prevent devices that are not safe and effective from entering or remaining on the market. Medical devices regulation is complex, in part, because of the wide variety of items that are categorized as medical devices; examples range from a simple tongue depressor to a life-sustaining heart valve. The regulation of medical devices can affect their cost, quality, and availability in the health care system.

In order to be legally marketed in the United States, many medical devices must be reviewed by the Food and Drug Administration (FDA), the agency responsible for protecting the public health by overseeing medical products, including devices. FDA’s Center for Devices and Radiological Health (CDRH) is primarily responsible for medical device review. CDRH activities are funded through a combination of public money (i.e., direct FDA appropriations from Congress) and private money (i.e., user fees collected from device manufacturers) which together comprise FDA’s total. User fees account for 33% of FDA’s total FY2011 program level and 15% of CDRH’s program level, which is $378 million in FY2011 including $56 million in user fees. FDA’s authority to collect user fees, originally authorized in 2002 (P.L. 107-250), has been reauthorized in five-year increments. It will expire on October 1, 2012, under the terms of the Medical Device User Fee Act of 2007 (MDUFA), Title II of the FDA Amendments Act of 2007 (FDAAA, P.L. 110-85).

FDA requires all medical product manufacturers to register their facilities, list their devices with FDA, and follow general controls requirements. FDA classifies devices according to the risk they pose to consumers. Premarket review is required for moderate- and high-risk devices. There are two paths that manufacturers can use to bring such devices to market. One path consists of conducting clinical studies, submitting a premarket approval (PMA) application and requires evidence providing reasonable assurance that the device is safe and effective. The other path involves submitting a 510(k) notification demonstrating that the device is substantially equivalent to a device already on the market (a predicate device) that does not require a PMA. The 510(k) process results in FDA clearance and tends to be much less expensive and less time-consuming than seeking FDA approval via PMA. Substantial equivalence is determined by comparing the performance characteristics of a new device with those of a predicate device; clinical data demonstrating safety and effectiveness are usually not required. Once approved or cleared for marketing, manufacturers must comply with regulations on manufacturing, labeling, surveillance, device tracking, and adverse event reporting.

Problems related to medical devices can have serious consequences for consumers. Defects in medical devices, such as artificial hips and pacemakers, have caused severe patient injuries and deaths. In 2006, FDA reported 116,086 device-related injuries, 96,485 malfunctions, and 2,830 deaths; an analysis by the National Research Center for Women & Families claims there were 4,556 device-related deaths in 2009. Reports published in 2009 through 2011—by the Government Accountability Office (GAO), the Department of Health and Human Services Office of the Inspector General and the Institute of Medicine—have voiced concerns about FDA’s device review process. In 2009 and 2011 GAO included FDA’s oversight of medical products on the GAO list of high-risk areas. FDA has conducted internal reviews as well and is implementing changes.

Date of Report: June 25, 2012
Number of Pages: 33
Order Number: R42130
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How FDA Approves Drugs and Regulates Their Safety and Effectiveness

Susan Thaul
Specialist in Drug Safety and Effectiveness

Update: On June 20, 2012, the House of Representatives passed, by voice vote and under suspension of the rules, S. 3187 (EAH), the Food and Drug Administration Safety and Innovation Act, as amended. This bill would reauthorize the FDA prescription drug and medical device user fee programs (which would otherwise expire on September 30, 2012), create new user fee programs for generic and biosimilar drug approvals, and make other revisions to other FDA drug and device approval processes. It reflects bicameral compromise on earlier versions of the bill (S. 3187 [ES], which passed the Senate on May 24, 2012, and H.R. 5651 [EH], which passed the House on May 30, 2012). The following CRS reports provide overview information on FDA’s processes for approval and regulation of drugs:

• CRS Report R41983, How FDA Approves Drugs and Regulates Their Safety and Effectiveness, by Susan Thaul. 
• CRS Report RL33986, FDA’s Authority to Ensure That Drugs Prescribed to Children Are Safe and Effective, by Susan Thaul. 
• CRS Report R42130, FDA Regulation of Medical Devices, by Judith A. Johnson. 
• CRS Report R42508, The FDA Medical Device User Fee Program, by Judith A. Johnson. 

(Note: The rest of this report has not been updated since September 1, 2011.)

The Food and Drug Administration (FDA) is a regulatory agency within the Department of Health and Human Services. A key responsibility is to regulate the safety and effectiveness of drugs sold in the United States. FDA divides that responsibility into two phases: preapproval (premarket) and postapproval (postmarket). FDA reviews manufacturers’ applications to market drugs in the United States; a drug may not be sold unless it has FDA approval. The agency continues its oversight of drug safety and effectiveness as long as the drug is on the market. Beginning with the Food and Drugs Act of 1906, Congress has incrementally refined and expanded FDA’s responsibilities regarding drug approval and regulation.

The progression to drug approval begins before FDA involvement. First, basic scientists work in the laboratory and with animals; second, a drug or biotechnology company develops a prototype drug. That company must seek and receive FDA approval, by way of an investigational new drug (IND) application, to test the product with human subjects. Those tests, called clinical trials, are carried out sequentially in Phase I, II, and III studies, which involve increasing numbers of subjects. The manufacturer then compiles the resulting data and analysis in a new drug application (NDA). FDA reviews the NDA with three major concerns: (1) safety and effectiveness in the drug’s proposed use; (2) appropriateness of the proposed labeling; and (3) adequacy of manufacturing methods to assure the drug’s identity, strength, quality, and purity. The Federal Food, Drug, and Cosmetic Act (FFDCA) and associated regulations detail the requirements at each step. FDA uses a few special mechanisms to expedite drug development and the review process when a drug might address an unmet need or a serious disease or condition. Those mechanisms include accelerated approval, animal efficacy approval, fast track applications, and priority review.

Once a drug is on the U.S. market (following FDA approval of the NDA), FDA continues to address drug production, distribution, and use. Its activities, based on ensuring drug safety and effectiveness, address product integrity, labeling, reporting of research and adverse events, surveillance, drug studies, risk management, information dissemination, off-label use, and directto- consumer advertising, all topics in which Congress has traditionally been interested.

FDA seeks to ensure product integrity through product and facility registration; inspections; chain-of-custody documentation; and technologies to protect against counterfeit, diverted, subpotent, adulterated, misbranded, and expired drugs. FDA’s approval of an NDA includes the drug’s labeling; the agency may require changes once a drug is on the market based on new information. It also prohibits manufacturer promotion of uses that are not specified in the labeling. The FFDCA requires that manufacturers report to FDA adverse events related to its drugs; clinicians and other members of the public may report adverse events to FDA. The agency’s surveillance of drug-related problems, which had primarily focused on analyses of various adverse-event databases, is now expanding to more active uses of evolving computer technology and linking to other public and private information sources.

The FFDCA allows FDA to require a manufacturer to conduct postapproval studies of drugs. The law specifies when FDA must attach the requirement to the NDA approval and when FDA may issue the requirement after a drug is on the market. To manage exception risks of drugs, FDA may require patient or clinician guides and restrictions on distribution. The agency publicly disseminates information about drug safety and effectiveness; and regulates the industry promotion of products to clinicians and the public.

Date of Report: June 25, 2012
Number of Pages: 23
Order Number: R41983
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FDA’s Authority to Ensure That Drugs Prescribed to Children Are Safe and Effective

Susan Thaul
Specialist in Drug Safety and Effectiveness

Summary Update: On June 20, 2012, the House of Representatives passed, by voice vote and under suspension of the rules, S. 3187 (EAH), the Food and Drug Administration Safety and Innovation Act, as amended. This bill would reauthorize the FDA prescription drug and medical device user fee programs (which would otherwise expire on September 30, 2012), create new user fee programs for generic and biosimilar drug approvals, and make other revisions to other FDA drug and device approval processes. It reflects bicameral compromise on earlier versions of the bill (S. 3187 [ES], which passed the Senate on May 24, 2012, and H.R. 5651 [EH], which passed the House on May 30, 2012). The following CRS reports provide overview information on FDA’s processes for approval and regulation of drugs:

• CRS Report R41983, How FDA Approves Drugs and Regulates Their Safety and Effectiveness, by Susan Thaul.
• CRS Report RL33986, FDA’s Authority to Ensure That Drugs Prescribed to Children Are Safe and Effective, by Susan Thaul.
• CRS Report R42130, FDA Regulation of Medical Devices, by Judith A. Johnson.
• CRS Report R42508, The FDA Medical Device User Fee Program, by Judith A. Johnson.

(Note: The rest of this report has not been updated since November 10, 2011.)

With the Best Pharmaceuticals for Children Act (BPCA) and the Pediatric Research Equity Act (PREA), Congress authorized the Food and Drug Administration (FDA) to offer drug manufacturers financial and regulatory incentives to test their products for use in children. Congress extended both programs with the FDA Amendments of 2007 (FDAAA) and, because of the programs’ sunset date, must act before October 1, 2012, to continue them. This report presents the historical development of BPCA and PREA, their rationale and effect, and FDAAA’s impact. The report also discusses pediatric drug issues that remain of concern to some in Congress.

Most prescription drugs have never been the subject of studies specifically designed to test their effects on children. In these circumstances, clinicians, therefore, may prescribe drugs for children that FDA has approved only for adult use; this practice is known as off-label prescribing. Although some clinicians may believe that the safety and effectiveness demonstrated with adults would hold for younger patients, studies show that the bioavailability of drugs—that is, how much gets into a patient’s system and is available for use—varies in children for reasons that include a child’s maturation and organ development and other factors. The result of such off-label prescribing may be that some children receive ineffective drugs or too much or too little of potentially useful drugs; or that there may be side effects unique to children, including effects on growth and development.

Drug manufacturers are reluctant to test drugs in children because of economic, ethical, legal, and other obstacles. Market forces alone have not provided manufacturers with sufficient incentives to overcome these obstacles. BPCA and PREA represent attempts by Congress to address the need for pediatric testing. FDA had tried unsuccessfully to spur pediatric drug research through administrative action before 1997. With the FDA Modernization Act of 1997 (FDAMA, P.L. 105- 115), Congress provided an incentive: if a manufacturer completed pediatric studies that FDA requested, the agency would extend the company’s market exclusivity for that product for six
months, not approving the sale of another manufacturer’s product during that period. In 2002, BPCA (P.L. 107-109) reauthorized this program for five years.

In 1998, to obtain pediatric use information on the drugs that manufacturers were not studying, FDA published the Pediatric Rule, which required manufacturers to submit pediatric testing data at the time of all new drug applications. In 2002, a federal court declared the rule invalid, holding that FDA lacked the statutory authority to promulgate it. Congress gave FDA that authority with PREA (P.L. 108-155). PREA covers drugs and biological products and includes provisions for deferrals, waivers, and the required pediatric assessment of an approved marketed product.

In extending BPCA and PREA in 2007, Congress considered several issues: Why offer a financial incentive to encourage pediatric studies when FDA has the authority to require them? How does the cost of marketing exclusivity—including the higher prices paid by government—compare with the cost of the needed research? What percentage of labeling includes pediatric information because of BPCA and PREA? Do existing laws provide FDA with sufficient authority to encourage pediatric studies and labeling? Is FDA doing enough with its current authority? The 112th Congress will likely consider those questions as well as others: What information do clinicians and consumers need and how could industry and government develop and disseminate it? How can Congress balance positive and negative incentives to manufacturers for developing pediatric information to use in labeling? How could Congress consider cost and benefit when it deals with reauthorizing legislation in 2012?

Date of Report: June 25, 2012
Number of Pages: 28
Order Number: RL33986
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FDA Regulation of Cosmetics and Personal Care Products

Amalia K. Corby-Edwards
Analyst in Public Health and Epidemiology

The 1938 Federal Food, Drug, and Cosmetic Act (FFDCA) granted the Food and Drug Administration (FDA) the authority to regulate cosmetic products and their ingredients. The statutory provisions of the FFDCA that address cosmetics include adulteration and misbranding provisions. In addition to the FFDCA, cosmetics are regulated under the Fair Packaging and Labeling Act (FPLA) and related regulations. The cosmetics provisions were amended by the Color Additive Amendments Act of 1960 and the Poison Prevention Packaging Act, but remain basically the same as the provisions in the 1938 FFDCA.

FDA’s authorities over cosmetic products include some of those applicable to other FDAregulated products, such as food, drugs, medical devices, and tobacco. For example, FDA has the authority to take certain enforcement actions—such as seizures, injunctions, and criminal penalties—against adulterated or misbranded cosmetics. Additionally, as with drug and food companies, FDA may conduct inspections of cosmetic manufacturers and prohibit imports of cosmetics that violate the FFDCA. The agency also has issued rules restricting the use of ingredients that the agency has determined are poisonous or deleterious.

However, FDA’s authority over cosmetics is less comprehensive than its authority over other FDA-regulated products with regard to registration; testing; premarket notification, clearance, or approval; good manufacturing practices; mandatory risk labeling; adverse event reports; and recalls. For example, FDA does not impose registration requirements on cosmetic manufacturers. Rather, cosmetic manufacturers may decide to comply with voluntary FDA regulations on registration. With the exception of color additives, FDA does not require premarket notification, safety testing, review, or approval of the chemicals used in cosmetic products. Cosmetic manufacturers also are not required to use good manufacturing practices (GMP)—although FDA has released GMP guidelines for cosmetic manufacturers—nor required to file ingredient information with, or report adverse reactions to, the agency. Instead, under a voluntary FDA program, cosmetic manufacturers and packagers may report the ingredients used in their product formulations. FDA does not have the authority to require a manufacturer to recall a cosmetic product from the marketplace, although the agency has issued general regulations on voluntary recalls. The agency’s ability to issue regulations on cosmetic products is limited by the agency’s statutory authorities or lack thereof.

As a result, cosmetics are arguably more self-regulated than other FDA-regulated products. The manner in which a cosmetic product could or should be regulated, however, is not always clear. FDA’s guidelines have provided the cosmetic industry with considerable flexibility for product development and claims. The question remains as to whether that flexibility and the extent of government oversight of cosmetic products are still appropriate.


Date of Report: July 9, 2012
Number of Pages: 43
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Prescription Drug Monitoring Programs

Kristin M. Finklea
Specialist in Domestic Security

Erin Bagalman
Analyst in Health Policy

Lisa N. Sacco
Analyst in Illicit Drugs and Crime Policy

In the midst of national concern over illicit drug use and abuse, prescription drug abuse has been identified as the United States’ fastest growing drug problem. Nearly all prescription drugs involved in overdoses are originally prescribed by a physician (rather than, for example, being stolen from pharmacies). Thus, attention has been directed toward preventing the diversion of prescription drugs after the prescriptions are dispensed.

Prescription drug monitoring programs (PDMPs) maintain statewide electronic databases of prescriptions dispensed for controlled substances (i.e., prescription drugs of abuse that are subject to stricter government regulation). Information collected by PDMPs may be used to support access to and legitimate medical use of controlled substances; identify or prevent drug abuse and diversion; facilitate the identification of prescription drug-addicted individuals and enable intervention and treatment; outline drug use and abuse trends to inform public health initiatives; or educate individuals about prescription drug use, abuse, and diversion as well as about PDMPs.

How PDMPs are organized and operated varies among states. Each state determines which agency houses the PDMP; which controlled substances must be reported; which types of dispensers are required to submit data (e.g., pharmacies); how often data are collected; who may access information in the PDMP database (e.g., prescribers, dispensers, or law enforcement); the circumstances under which the information may (or must) be accessed; and what enforcement mechanisms are in place for noncompliance.

PDMP costs may vary widely, with startup costs ranging from $450,000 to over $1.5 million and annual operating costs ranging from $125,000 to nearly $1.0 million. States finance PDMPs using monies from a variety of sources including the state general fund, prescriber and pharmacy licensing fees, state controlled substance registration fees, health insurers’ fees, direct-support organizations, state grants, and/or federal grants. The federal government has established two grant programs aimed at supporting state PDMPs: The Harold Rogers PDMP grant, administered by the Department of Justice, and the National All Schedules Prescription Electronic Reporting Act of 2005 (NASPER) grant, administered by the Department of Health and Human Services. The Harold Rogers PDMP received $7.0 million in appropriations for FY2012; NASPER last received appropriations (of $2.0 million) in FY2010.

State PDMPs vary widely with respect to whether or how information contained in the database is shared with other states. While some states do not have measures in place allowing interstate sharing of information, others have specific practices for sharing. An effort is ongoing to facilitate information sharing using prescription monitoring information exchange (PMIX) architecture. Currently, there are no national level standards for state PDMP information sharing and interoperability. Legislation has been introduced in the 112th Congress that would take up these issues (see, for example, Section 1141 of the Food and Drug Administration Safety and Innovation Act (P.L. 112-144), the Medicare and Medicaid FAST Act (H.R. 3399, S. 1251), and ID MEDS Act (H.R. 4292, S. 2254)).

The available evidence suggests that PDMPs are effective in reducing the time required for drug diversion investigations, changing prescribing behavior, reducing “doctor shopping,” and reducing prescription drug abuse; however, research on the effectiveness of PDMPs is limited. Assessments of effectiveness may also take into consideration potential unintended consequences of PDMPs, such as limiting access to medications for legitimate use or pushing drug diversion
activities over the border into a neighboring state. Experts suggest that PDMP effectiveness might be improved by increasing the timeliness, completeness, consistency, and accessibility of the data.

Current policy issues that might come before Congress include the role of state PDMPs in the federal prescription drug abuse strategy and the role of the federal government in interstate datasharing and interoperability. While establishment and enhancement of PDMPs enjoy broad support, stakeholders express concerns about health care versus law enforcement uses of PDMP data (particularly with regard to protection of personally identifiable health information) and maintaining access to medication for patients with legitimate medical needs.

Date of Report: July 10, 2012
Number of Pages: 25
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Housing for Persons Living with HIV/AIDS

Libby Perl
Specialist in Housing Policy

Since the beginning of the acquired immunodeficiency syndrome (AIDS) epidemic in the early 1980s, many individuals living with the disease have had difficulty finding affordable, stable housing. As individuals become ill, they may find themselves unable to work, while at the same time facing health care expenses that leave few resources to pay for housing. In addition, many of those persons living with AIDS struggled to afford housing even before being diagnosed with the disease. The financial vulnerability associated with AIDS, as well as the human immunodeficiency virus (HIV) that causes AIDS, results in a greater likelihood of homelessness among persons living with the disease. At the same time, those who are homeless may be more likely to engage in activities through which they could acquire or transmit HIV. Further, recent research has indicated that those individuals living with HIV who live in stable housing have better health outcomes than those who are homeless or unstably housed, and that they spend fewer days in hospitals and emergency rooms.

Congress recognized the housing needs of persons living with HIV/AIDS when it approved the Housing Opportunities for Persons with AIDS (HOPWA) program in 1990 as part of the Cranston-Gonzalez National Affordable Housing Act (P.L. 101-625). The HOPWA program, administered by the Department of Housing and Urban Development (HUD), funds short-term and permanent housing, together with supportive services, for individuals living with HIV/AIDS and their families. In addition, a small portion of funds appropriated through the Ryan White HIV/AIDS program, administered by the Department of Health and Human Services (HHS), may also be used to fund short-term housing for those living with HIV/AIDS.

In FY2012, Congress appropriated $332 million for HOPWA as part of the Consolidated Appropriations Act (P.L. 112-55). This was a reduction of $3 million from the $335 million appropriated in FY2011 and FY2010, the most funding ever appropriated for the program. Prior to FY2010, the most that had been appropriated for HOPWA was $310 million in FY2009. HOPWA funds are distributed to states and localities through both formula and competitive grants. HUD awards 90% of appropriated funds by formula to states and eligible metropolitan statistical areas (MSAs) based on population, reported cases of AIDS, and incidence of AIDS. The remaining 10% is distributed through a grant competition. Funds are used primarily for housing activities, although grant recipients must provide supportive services to those persons residing in HOPWA-funded housing.


Date of Report: July 3, 2012
Number of Pages: 26
Order Number: RL34318
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Medicaid: A Primer

Elicia J. Herz
Specialist in Health Care Financing

In existence for 47 years, Medicaid is a means-tested entitlement program that financed the delivery of primary and acute medical services as well as long-term care to more than 69 million people in FY2011. The estimated annual cost to the federal and state governments was roughly $404 billion in FY2010. In comparison, the Medicare program provided health care benefits to nearly 48 million seniors and certain persons with disabilities, and cost roughly $523 billion in FY2010. Because Medicaid represents a large component of federal mandatory spending, Congress is likely to continue its oversight of Medicaid’s eligibility, benefits, and costs.

Understanding the complex statutory and regulatory rules that govern Medicaid is further complicated by the fact that each state designs and administers its own version of the program under broad federal rules. State variability is the rule rather than the exception in terms of eligibility levels, covered services, and how those services are reimbursed and delivered. The ACA makes both mandatory and optional changes to Medicaid along some of these dimensions.

This report describes the basic elements of Medicaid, focusing on the federal rules governing who is eligible, what services are covered, how the program is financed, and how beneficiaries share in the cost of care, how providers are paid, and the role of special waivers in expanding eligibility and modifying benefits. Examples of both mandatory and optional eligibility groups and benefits as defined in the federal statute are described. Basic program statistics are also provided. Finally, selected legislative changes at the federal level via the ACA, and the Supreme Court decision in National Federation of Independent Busines v. Sebelius announced on June 28, 2012, that affect Medicaid in significant ways are also described.


Date of Report: June 29, 2012
Number of Pages: 19
Order Number: RL33202
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Individual Mandate and Related Information Requirements under ACA

Janemarie Mulvey
Specialist in Health Care Financing

Hinda Chaikind
Section Research Manager

Beginning in 2014, ACA through amendments to the Internal Revenue Code requires individuals to maintain health insurance, with some exceptions. Most individuals will be required to maintain minimum essential coverage, which includes eligible employer coverage, individual coverage, grandfathered plans, and federal programs such as Medicare and Medicaid, among others. Those who do not maintain minimum essential coverage, and who are not exempt from the mandate, will be required to pay a penalty for noncompliance.

On June 28, 2012, the United States Supreme Court issued its decision in National Federation of Independent Business v. Sebelius, finding that the individual mandate in § 5000A of the Internal Revenue Code (as added by § 1501 of the Patient Protection and Affordable Care Act (ACA)), is a constitutional exercise of Congress’s authority to levy taxes. However, the Court held that it was not a valid exercise of Congress’s power under the Commerce Clause or the Necessary and Proper Clause.

This report describes the individual mandate under Section 1501 and Section 10106 of the Patient Protection and Affordable Care Act (ACA, P.L. 111-148), as amended by Section 1002 of the Health Care and Education Reconciliation Act of 2010 (P.L. 111-152). Hereinafter, “ACA” will refer to ACA as amended by the reconciliation act and other laws. In addition, ACA includes several reporting requirements designed, in part, to assist individuals in providing evidence of having met the mandate, as well as other related information about their health insurance. These requirements are also described in this report.


Date of Report: July 2, 2012
Number of Pages: 16
Order Number: R41331
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FDA User Fees and the Regulation of Drugs, Biologics, and Devices: Comparative Analysis of S. 3187 and H.R. 5651

Susan Thaul, Coordinator
Specialist in Drug Safety and Effectiveness

Erin Bagalman
Analyst in Health Policy

Amalia K. Corby-Edwards
Analyst in Public Health and Epidemiology

Judith M. Glassgold
Specialist in Health Policy

Judith A. Johnson
Specialist in Biomedical Policy

Sarah A. Lister
Specialist in Public Health and Epidemiology

Amanda K. Sarata
Specialist in Health Policy

UPDATE: On June 18, 2012, the Senate Committee on Health, Education, Labor, and Pensions and the House Committee on Energy and Commerce distributed the text of an agreement that combined provisions of S. 3187 [ES], as passed by the Senate on May 24, 2012, and H.R. 5651 [EH], as passed by the House on May 30, 2012. The full House passed the new version by voice vote under suspension of the rules on June 20, 2012. On June 25, 2012, the Senate voted for cloture to limit debate on that bill, S. 3187 [EAH], the Food and Drug Administration Safety and Innovation Act of 2012 [hereinafter referred to as “the agreement”]. The Senate is expected to vote on the agreement sometime the week of June 25, 2012. For information on selected features of the agreement, see the Introduction of this report. 

The Senate Committee on Health, Education, Labor, and Pensions and the House Committee on Energy and Commerce have worked for more than a year developing Food and Drug Administration (FDA)-related legislation, versions of which both chambers passed in the last week of May 2012. S. 3187 (the Food and Drug Administration Safety and Innovation Act) and H.R. 5651 (the Food and Drug Administration Reform Act of 2012) each include provisions that would affect the regulation of human drugs, biological products, and medical devices, along with several agency-wide administrative or miscellaneous items. Majority and minority committee leaders have expressed the desire to get a completed bill to the President before July 4, 2012.

The impetus to the timing of these bills is that current authority for FDA to collect fees under the Prescription Drug User Fee Amendments (PDUFA) of 2007 and the Medical Device User Fee Amendments (MDUFA) of 2007 will expire on October 1, 2012, unless reauthorizing legislation is enacted before then. Member statements at committee hearings indicated no opposition to reauthorization and very little comment about changes to the current user fee programs. Because Members of Congress generally consider the user fee reauthorizations to be must-pass legislation—for example, the user fee revenue accounts for more than half of the agency’s human drug program budget—they have used these bills as vehicles for numerous additional measures.

The introduction to this report highlights selected features of S. 3187 [EAH], the agreement, relative to S. 3187 [ES] and H.R. 5651 [EH]. The remainder of this report provides, in a series of 14 tables, comparisons of the provisions in S. 3187 [ES] and H.R. 5651 [EH], presented generally in the order in which they appear in the Senate bill, the first to be reported by committee. Each table addresses a broad topic (e.g., human device regulation) and is preceded by narrative discussing the policy and legislative context of the table’s provisions.


Date of Report: June 26, 2012
Number of Pages: 100
Order Number: R42564
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Medical Malpractice: Overview and Legislation in the 112th Congress

Baird Webel
Specialist in Financial Economics

Vivian S. Chu
Legislative Attorney

Amanda K. Sarata
Specialist in Health Policyb

As a policy area, medical malpractice involves issues related to its prevalence in the health care system; the market for provider liability insurance; and the resolution of malpractice complaints through the tort system.

Medical malpractice has attracted congressional attention numerous times over the past decades, particularly in the midst of three “crisis” periods for the liability insurance market in the mid- 1970s, the mid-1980s, and the early 2000s. These periods were marked by sharp increases in medical liability insurance premiums, difficulties in finding any medical liability insurance in some areas as insurers withdrew from providing coverage, reports of providers leaving areas or retiring following insurance difficulties, and a variety of public policy measures at both the state and federal levels. The effectiveness of various public policy measures in addressing the issues in the medical malpractice liability market has been a matter of debate, in part because these difficulties have arisen at the intersection of the health care, tort, and insurance systems.

The overall medical liability insurance market is not currently exhibiting a comparable level of disruption to that in the “crisis” periods. Nonetheless, concerns persist regarding the affordability and availability of malpractice insurance in particular regions and for certain physician specialties (e.g., obstetricians). In addition, concern about medical malpractice claims may affect individual provider decisions and the cost of health care.

In terms of direct costs, medical malpractice insurance adds relatively little to the overall cost of health care. Medical malpractice premiums in 2010 totaled approximately $10.2 billion, whereas overall health expenditures were $2.6 trillion in 2010 according, respectively, to data from insurance rating firm AM Best and the National Health Expenditure Accounts. Indirect costs, particularly increased use of services by providers to protect against future lawsuits (“defensive medicine”), have been estimated to be higher than direct costs. CBO estimated that enacting federal tort reforms would reduce health care spending by approximately 0.4%-0.5% (roughly $9 billion-$11 billion) and the federal budget deficit by between $40 billion and $57 billion over a 10-year period.

The malpractice system also faces issues of equity and access. For example, some observers have criticized the current system’s performance with respect to (1) compensating patients who have been harmed by malpractice, (2) deterring substandard medical care, and (3) promoting patient safety. There are differing opinions as to the extent that each of these areas has been affected by the current malpractice system.

In the 112th Congress, the primary vehicle addressing medical malpractice has been H.R. 5, which focused on medical liability tort reform when introduced but was amended to include language similar to other legislation, specifically H.R. 157, H.R. 1150, H.R. 1943, and H.R. 3586. The amended version of H.R. 5 passed the House in March 2012. Language similar to the introduced version of H.R. 5 was included in H.R. 5652, the House budget reconciliation bill for FY2013, which passed the House in May 2012. The Senate has yet to consider H.R. 5 or S. 218 and S. 1099, companion bills to H.R. 5 as introduced. The President’s budgets for FY2012 and FY2013 both requested $250 million for grants to test a variety of reform proposals, but this funding has not been appropriated by Congress.


Date of Report: June 18, 2012
Number of Pages: 20
Order Number: R41693
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