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Welcome back to Vitals. Busy day ahead: a Senate Finance Committee confirmation vote for Tom Price, a meeting between President Trump and leaders of the Pharmaceutical Research and Manufacturers of America, the first Aetna earnings call since a federal judge knocked down its proposed merger with Humana, and the season finale of Obamacare open enrollment. Oh, and we'll get a Supreme Court nominee tonight, too. And those are just the things we know about.

Thanks for reading, and here's your daily reminder to check out the Axios health care news stream, like Axios on Facebook and follow us on Twitter, and sign up for our health care alerts.

How the regulations executive order could backfire


The goal of President Trump's latest executive order is clear enough: Fewer rules. But the way he's going about it — making agencies withdraw two old regulations every time they issue a new one — is a bit sloppy and probably will cause more problems than it solves, former Health and Human Services officials tell me.

That's mainly from Obama administration alums, so take it for what it's worth. But they weren't really hostile to the idea — they just don't think it will end well. Here's what the Trump team will probably find out as they implement the order:

  • It takes time to figure out which regulations to withdraw. That "just adds a layer of work that may not be very productive," said Kathleen Sebelius, the former Health and Human Services secretary under President Barack Obama.
  • If Republicans really want to repeal or even rewrite Obamacare, it's going to take a whole new set of rules to implement that, and the executive order is "more likely to slow things down rather than speed them up," said Sebelius.
  • It also takes a lengthy process just to get rid of a rule, said former HHS official Rima Cohen.
  • There are also plenty of regulations that are routine, and that everyone wants — like updating payment rates for doctors.
Tom Scully, who ran the Centers for Medicare and Medicaid Services under President George W. Bush, said the order would be "a little clumsy, but I don't think it's undoable" — as long as the Office of Management and Budget doesn't apply the order too literally. More from Caitlin Owens and me here.

One big impact: 21st Century Cures

The executive order could have an especially big impact on implementing the 21st Century Cures law, which just passed in the last Congress. Rachel Sachs, a health care legal expert at Washington University in St. Louis, explains why in this blog post that was making the rounds yesterday: the law has all kinds of provisions that will require new regulations, such as one to make sure health IT companies don't do anything that gets in the way of exchanging electronic health information.

Those regulations, Sachs points out, "are not ones the agency in its own judgment has decided are necessary. They are ones that Congress and the President have deemed are necessary."

Obamacare open enrollment could end quietly

Tonight is the deadline for people to sign up for Obamacare for 2017 coverage, but there's going to be a big difference between this year and previous years. Every time open enrollment ended under the Obama administration, they'd eagerly give us real-time updates. "Look how many people signed up by noon! It's going gangbusters!" This year, there's no guarantee that we'll get any updates at all. I've been asking HHS officials from President Trump's team, and haven't gotten an answer yet.

Of course they don't have the same level of enthusiasm for the law as the Obama team did, but we're also still in that transitional period where the old HHS team isn't allowed to talk publicly and the new team is still getting its act together. So maybe we'll get some updates out of the blue — but it's also possible we'll end the day with no idea what happened.

How hospitals are being rattled by Obamacare uncertainty

Bob Herman has a story this morning about why hospital executives are so worried about what comes after Obamacare, if the repeal goes through. It's actually not the loss of patients with private insurance that concerns them the most, Bob writes — it's losing patients with Medicaid coverage. But they're also worried about patients who won't be able to pay their bills because of high deductibles.

The bottom line: Hospitals were just starting to make progress against the uncompensated care costs they used to face — and they don't want to go back. Read Bob's story here.

PhRMA leaders to get face time with Trump

Well, that didn't take long: Trump and Vice President Mike Pence are going to meet this morning with PhRMA president and CEO Stephen Ubl, along with several of the group's board members. What ever will they talk about? Yes, you can be pretty sure drug prices will come up. But Ubl has talked about other issues on the group's agenda where they're more likely to find common ground, especially on reforming the Food and Drug Administration to give more encouragement to medical innovation.

So yes, it'll be awkward, but it probably won't be awkward the whole time.

That drip-drip-drip isn't stopping the Tom Price vote

Trump's Health and Human Services nominee is up for a Senate Finance Committee confirmation vote this morning, and at the moment, he looks safe even though the ethics stories haven't stopped. The latest came yesterday from the Wall Street Journal, which reported that Price got a privileged offer to buy stock in Innate Immunotherapeutics Ltd., an Australian medical biotechnology company, at a discount — which is not what he said in his confirmation hearings.

So far, none of the stories about Price's stock trades have made enough of an impact to peel Republicans away, so he'll probably have the votes even if some or all Democrats oppose him. The Finance Committee will vote on Price as well as Steven Mnuchin, the Treasury nominee, whose confirmation vote got delayed yesterday by a Democratic procedural maneuver.

New lawsuit targets drug companies over insulin prices

Eli Lilly, Novo Nordisk and Sanofi are grappling with a new class-action lawsuit that accuses them of colluding with pharmacy benefit managers to jack up the prices of their insulin products, Bob Herman reports. The lawsuit says each drug company raised prices at the same times even though there was no change in demand or research costs. Yale endocrinologist Dr. Kasia Lipska called the rise of insulin prices a "racket" in a popular New York Times op-ed last February.

Why this matters: Drug companies will continue to face heat over what many have said are unjustified price hikes. Several generic drug makers are facing similar legal probes over price-fixing. But this latest lawsuit also shows an appetite to drag pharmacy benefit managers out of the shadows. You can view the full lawsuit here.

What we're watching today: Aetna quarterly earnings report, to be released before the markets open; Trump meeting with PhRMA leaders, 9 a.m. Eastern; Senate Finance Committee confirmation vote on Tom Price, executive session starts at 10 a.m. Eastern; Trump announces Supreme Court nominee, 8 p.m. Eastern; the end of Obamacare open enrollment, midnight.

What we're watching this week: Senate HELP Committee hearing on stabilizing the individual market, Wednesday; House Energy and Commerce health subcommittee hearing on pre-existing condition coverage and other insurance reforms, Thursday; 2018 payment rates and policies for Medicare Advantage plans, Thursday.

OK, get on with your day. Thanks, and keep me posted on other stuff we should be covering:


Facebook's new tool will help you avoid your ex after a breakup

Employees of the Competence Call Center (CCC) work for the Facebook Community Operations Team in Essen, Germany. Photo: Martin Meissner / AP

Facebook has deployed two new features on its site which will allow users more control over who and what they see in their feeds, according to Facebook's Director of Research David Ginsberg, and Research Scientist Moira Burke.

Why it matters: Research showed that users' mental health in relation to social media depended on how they used it. Passive consumption of their feed resulted in worse mental health, while active interaction with friends and family was "linked to improvements in well-being."

Two new features:

  • Snooze: This feature allows users to hide a person or page for 30 days without unfriending or unfollowing them.
  • Take a Break: After a breakup, users can now dictate what their ex can and cannot see, and vice versa.

One more thing: Facebook's suicide prevention AI.


GOP tax bill enhances child tax credit in response to Rubio

Rubio and Ivanka Trump have pushed for an expanded child tax credit. Photo: Alex Wong / Getty Images

The final GOP tax bill will enhance the child tax credit, according to four GOP sources. Enhancing the refundability of the credit was a key demand of Sen. Marco Rubio, who threatened to vote no on the bill if it wasn't addressed, and Sen. Mike Lee, who was undecided.

"We have not seen text but I think it is fair to say the working families will get more tax relief in the final bill," said Conn Carroll, a Lee spokesman. The conference report will allow families with no income tax liability to receive $1,400 of the $2,000 credit, according to the WSJ and confirmed by an aide. The original Rubio-Lee ask was that the credit be fully refundable up to payroll tax liability.

Why this matters: It now seems likely Rubio will vote for the bill and, sparing any other last-minute issues, the bill will cruise to passage next week.


Trump administration's climate debate on hold

President Trump speaks at EPA headquarters, with Vice President Mike Pence and EPA Administrator Scott Pruitt. Photo: Jim Watson/AFP/Getty

The Trump administration's plans to publicly debate climate-change science is on indefinite hold, E&E News reports.

Why it matters: This is the latest sign the administration is not looking to overtly challenge mainstream climate-change science, despite a few vocal skeptics of the science in and close to the administration. 

The other signs:

  • The administration released in November a congressionally mandated report confirming human-influenced climate change.
  • EPA Administrator Scott Pruitt said in recent congressional testimony he plans to issue a rule cutting carbon emissions from power plants, which is replacing a more sweeping such rule President Obama issued. The fact he's issuing a replacement at all is a subtle but clear sign the agency isn't going to review a 2009 scientific finding Obama's EPA issued that concluded greenhouse gases endanger public health and welfare. The finding is the scientific and legal underpinning of most climate-related regulations. 

Go deeper:


Trump tells FBI graduates he has their back "100 percent"

President Trump speaks during the FBI National Academy graduation ceremony Friday. PhotoL Evan Vucci / AP

President Trump received a warm welcome at the FBI National Academy graduation ceremony Friday, less than an hour after continuing to make claims about how angry the American public is with the bureau and his Justice Department, calling it "a shame." But Trump took on a more optimistic tune during his speech to the graduates:

"Know, with me as your president, America's police will have a true friend and loyal champion in the White House – more loyal than anyone else can be...The president of the United States has your back 100 percent."

Key quotes from Trump's speech:

  • He went after chain migration and the visa lottery system: "You think the country is giving us their best people? No... They give us their worst people, they put them in a bin ... really the worst of the worst." (Go deeper: How the diversity visa process works. Take note: Recipients of diversity visas are vetted through the same process as any other visa recipients).
  • And crime in Chicago: "What the hell is going on in Chicago? What the hell is happening there? ... Police departments are overstretched, they're underfunded and they're totally underappreciated — except by me." (Go deeper: Trump compares Chicago to Afghanistan; Chicago police tout 14% homicide drop)
  • His message "to those who threaten violence against our police": "We will protect those who protect us. And we believe criminals who kill police officers should get the death penalty." (Go deeper: Trump's history of calling for the death penalty)

Dem woman drops out of Kansas race over sexual harassment settlement

Andrea Ramsey is dropping out of the race in Kansas. Photo via screengrab from Kansas City Star video.

A Democratic woman who was running for Congress in Kansas' 3rd district dropped out of the race today after it was revealed a former male employee filed a sexual harassment lawsuit against her in 2005. She denies his allegations.

Why it matters: Andrea Ramsey is the first female candidate accused of sexual harassment in a time when these allegations are hitting nearly every industry. And her resignation from the race reflects the zero-tolerance policy the Democratic Party is implementing for such instances and for candidates at every level.

The allegations: When Ramsey was the executive vice president of human resources at LabOne Inc. in 2005, Gary Funkhouser — a male employee who worked under Ramsey as a human resources manager — alleged she propositioned him for sex. She made “unwelcome and inappropriate sexual comments and innuendos" toward him, according to the lawsuit he filed against LabOne in October 2005. Ramsey then stopped talking to Funkhouser, moved him from his office to a cubicle farther away from her in the office, and then fired him on June 13, 2005. Funkhouse and LabOne permanently closed the case in July 2006 after reaching agreed-upon mediation terms, according to legal documents reviewed by Axios.

When I spoke to Funkhouser by phone back in November, he told me he expected Ramsey would try to deny the claims, which she has done.

“In its rush to claim the high ground in our roiling national conversation about harassment, the Democratic Party has implemented a zero tolerance standard," Ramsey said in a statement to the Kansas City Star. “For me, that means a vindictive, terminated employee's false allegations are enough for the Democratic Congressional Campaign Committee (DCCC) to decide not to support our promising campaign. We are in a national moment where rough justice stands in place of careful analysis, nuance and due process." A DCCC source told Axios that Ramsey was never backed by their organization.

Funkhouser didn't want to comment further on the case today, but simply said "the matter was resolved."

Although she's running in a local Kansas race, Ramsey arguably had a higher profile than most Congressional candidates. She was endorsed by Emily's List, a D.C. based group that recruits and helps Democratic women run for office. Emily's List has already removed Ramsey's page from their website. "We understand that Andrea Ramsey has dropped out of the race. We support her decision and we wish her well," said Bryan Lesswing, Emily's List director of campaign communications.

Another source who works as a Democratic pollster told me Ramsey's situation was an "open secret" in local Kansas politics.

The intrigue: Ramsey, who has been accused of sexual harassment, campaigned on Roy Moore's sexual misconduct allegations in an email sent out in November. "Predatory behavior is wrong," her campaign wrote in the email asking supporters to donate to Doug Jones campaign in the Alabama U.S. Senate race.


How the end of net neutrality might affect customers

FCC Chairman Ajit Pai, photo: Jacquelyn Martin / AP

"The repeal of Obama-era net neutrality rules [yesterday] wipes from the books regulations that prevented Internet service providers from blocking or slowing some websites, and charging more for others to run faster," USA Today writes in the lead story of its print edition.

Why it matters: "The onus shifts to the public to flag any signs these Internet gatekeepers are playing favorites including with their own properties — and report them to the Federal Trade Commission if it looks like the provider is trying to suppress a competitor."

More from the report:

  • "The new regulations, passed by the Republican-controlled Federal Communications Commission's 3-2 vote, instead require companies like Verizon and Comcast to disclose if they block sites or give priority to their own content more than others — say by allowing Comcast unit NBCUniversal's sites to run at a faster clip than Time Warner's"
  • The other side: "The big Internet and cable providers, who lobbied hard for repeal, say they won't stop or slow any legal content."
  • What's next: "The replacement rules are slated to go into effect as soon as next month. But expect a noisy fight online and in the courts before then — and after."

The next wave in tech scandals is coming

A building on Microsoft's campus. Photo: Microsoft

A blockbuster story from Bloomberg on an alleged rape of one Microsoft intern at the hands of another raises questions both for how Microsoft handled the situation then as well as broader questions of how large tech companies will adjust to a new reality.

What's next: I'd be shocked if I am the only one left scratching their head over how Microsoft handled this one. And I'd also be shocked if other big tech companies won't also soon be dealing with tricky issues from their past.

  • The Microsoft case is clearly a complicated one. No charges were brought in the now five-year-old case and, while there was an internal investigation, it's not clear it was able to determine what happened at the event, which took place outside of work.
  • But there are several actions Microsoft took that seem dubious. It made choices that left the pair in proximity of one another, both as interns and then, equally puzzlingly, after it chose to hire both employees.
  • No matter what actually happened, Microsoft willingly put itself in the position of employing a woman as well as a man she accused of raping her.

Three big questions:

  1. Does Microsoft think it handled the situation appropriately at the time?
  2. Would it do anything differently today?
  3. Will it launch a broader re-evaluation of how it handles complaints?
Microsoft declined to respond specifically to these questions, instead issuing the same statement it gave to Bloomberg. However, that statement suggests the company, even today, believes it acted appropriately.
  • "We work hard to create a safe work environment for every employee. The incident referenced took place away from work, but we took the allegation very seriously. Our global security team and our employee relations investigations team met with the employee to review the allegation. We encouraged her to take her complaint to law enforcement, and offered to connect her with additional resources such as victim advocacy groups. We also took practical steps to address concerns she had about her safety. Law enforcement did not ultimately file any charges. Given this, and our own findings, we took the action we deemed appropriate related to the accused employee. We continued to work with the employee who raised the complaint to provide support."
Why it matters: Large tech companies have tens or hundreds of thousands of employees and, in addition to all the clear-cut cases of sexual harassment or assault, no doubt have all manner of more complex issues from their past, some of which will no doubt come under fresh scrutiny with a new sensibility applied.
  • Microsoft has shown itself willing to take action against employees, even high-ranking executives, when it is convinced there has been impropriety. I know of at least two high-ranking executives who were forced out of the company in such circumstances during the decade I covered the company for CNET.

Trump: "People are very, very angry" with FBI and Justice Department

President Trump speaks with reporters before heading to the FBI National Academy in Quantico, Photo: Alex Wong / Getty Images

"When you look at what's gone on with the FBI and this Justice Department — people are very, very angry... the level of anger with this FBI is certainly very sad."
— President Trump on his way to Quantico to participate in the FBI graduation

He also lamented how "it's a shame" what's happened with the Bureau, but added "we're going to rebuild the FBI, it'll be bigger and better than ever."

More from Trump:

  • He insisted that there has been "absolutely no collusion" with Russia, "that has been proven." Instead, he said the entire investigation is a "Democrat hoax" to provide cover for losing the election.
  • "That was a rigged system folks."His recent call with Vladimir Putin: "He said very nice things in terms of what I've done with the economy and this Congress ... we would love to have Russia's help on North Korea."
  • Did you know Mike Flynn lied to the FBI? "You know the answer," he said, adding that he doesn't want to talk about pardoning Flynn yet. "We'll see what happens."
  • Roy Moore should concede defeat to Doug Jones, he said.
  • Child tax credit, which Marco Rubio said is required to get him to vote yes on the tax bill: "The Democrats have done nothing in terms of children, in terms of child tax credit ... We're putting in a tremendous child tax credit."

How China is challenging the West

Photo: Andy Wong / AP

"China is manipulating decision-makers in Western democracies," The Economist writes in its cover editorial.

Why it matters: "When a rising power challenges an incumbent one, war often follows. That prospect, known as the Thucydides trap after the Greek historian who first described it, looms over relations between China and the West, particularly America."

More from the report:

  • Lingo: "Soft power" harnesses the allure of culture and values to add to a country's strength; sharp power helps authoritarian regimes coerce and manipulate opinion abroad.
  • What's new: "In Australia and New Zealand, Chinese money is alleged to have bought influence in politics, with party donations or payments to individual politicians."
  • "German intelligence said that China was using the LinkedIn business network to ensnare politicians and government officials, by having people posing as recruiters and think-tankers and offering free trips."

China’s new threat

China's man-made Subi Reef in the South China Sea. Photo: Bullit Marquez / AP

"While attention in Asia has been distracted by the North Korean nuclear crisis in the past year, China has continued to install high-frequency radar and other facilities that can be used for military purposes on its man-made islands in the South China Sea," Reuters reports from D.C.

Why it matters: "The United States and its allies oppose China's building of artificial islands in the South China Sea and their militarization, given concerns Beijing plans to use them to deny access to strategic routes."