Overnight Defense: Inside the House's $717B defense policy bill | Bill would authorize Trump's military parade, halt weapons sales to Turkey, allow sanctions waivers for allies with Russian weapons | SEALs discharged over drug use

View in your browser     Happy Friday and welcome to Overnight Defense. We're Ellen Mitchell and Rebecca Kheel, and here's your nightly guide to the latest developments at the Pentagon, on Capitol Hill and beyond. THE TOPLINE: The House on Friday released details of its $717 billion defense policy bill, with several notable provisions dealing with everything from President Trump’s desired military parade in Washington, D.C., to arms sales to Turkey, to an aviation crisis among the service branches. The fiscal year 2019 National Defense Authorization Act (NDAA) would authorize $616.7 billion for the Pentagon’s base budget, $22.1 billion for the Department of Energy’s defense programs and $300 million for other defense-related base budget items. It would also authorize $69 billion for a war fund known as the Overseas Contingency Operations (OCO) account, with additional mandatory spending of $8.9 billion rounding out the total. An aviation crisis: Citing a “crisis point,” including 25 service members killed in military aviation accidents this spring, the NDAA includes increases in funding for training, maintenance and new equipment aimed at helping to restore readiness. The bill goes beyond the administration’s budget request for funding for flying hours by $24.2 million, which “will help reverse the tragic trend of military aviation accidents,” the summary said. The proposal also has $83 million more than the administration’s request for other training operations. Trump’s military parade gets House GOP support: House Republicans backed Trump’s planned military parade with a provision in the NDAA that would allow the event to go forward. House Armed Services Committee Chairman Mac Thornberry (R-Texas) “agrees with President Trump that it is appropriate to honor and celebrate 100 years of patriotic sacrifice in a way that expresses appreciation and admiration for our men and women in uniform, including a parade in the nation’s capital and a national celebration for that purpose,” according to a summary of the bill. In order to ensure the parade does not leave the military flat-footed, the NDAA “prohibits the use of operational units or equipment in the parade if the secretary of Defense believes such use will hamper readiness." US defense sales to Turkey would be temporarily stopped: The bill also would hold U.S. weapons sales to NATO ally Turkey until a report is created to analyze worsening tensions between Washington and Ankara. The provision would require the Pentagon to provide Congress a report “on the impact that increasing strains on the U.S.-Turkey relationship, caused by provocative actions taken by the Turkish government over the past year, will have on all U.S. military and diplomatic activities currently conducted in Turkey.” The Pentagon would be prohibited from delivering major defense equipment sold to Turkey until the report is complete, according to the language, included in a minority summary of the NDAA released Friday. A senior committee aide told reporters that lawmakers are trying to work with the Defense Department to figure out where the countries’ relationship is headed as Washington is poised to hand over more than 100 F-35 Lightning II fighters to Turkey. Allies could get Russia sanctions waivers: The NDAA would also establish a “special rule” allowing the Trump administration to waive some sanctions on U.S. allies for buying Russian arms. The sanctions in question were required by the Countering America's Adversaries Through Sanctions Act, which Congress overwhelmingly passed last year. That bill, which was passed to punish Moscow for destabilizing activities, including its 2016 election interference, included a section requiring sanctions against those making transactions with Russia’s defense industry. But Defense Secretary James Mattis has been arguing the sanctions bill left no wiggle room not to sanction allies who intend to move away from Russian arms, but still need to contract with Moscow to maintain their older equipment. NORTH KOREA MEETING DRAWS CLOSER: Trump on Friday announced that a time and location had been chosen for the upcoming meeting with North Korean leader Kim Jong Un. "We now have a date. And we have a location. We'll be announcing it very soon," Trump said from the White House lawn. Trump predicted "very good things" from the meeting, which will be the first between a U.S. president and a North Korean leader since the end of the Korean War. U.S. troops are not on the table, he says: Trump said Friday that reducing the number of U.S. troops stationed in South Korea is “not on the table” in upcoming talks with Kim. “Not really, not at this moment, certainly not,” Trump said when asked if a reduction of American troops is a bargaining chip in the talks. Trump added that “we haven’t been asked” to reduce the military presence, but said a future withdrawal was still possible, citing the cost of U.S. forces' upkeep. “Now, I have to tell you, at some point into the future, I would like to save the money. You know, we have 32,000 troops there, but I think a lot a great things will happen, but troops are not on the table.” The U.S. has roughly 28,000 soldiers stationed on the Korean peninsula, according to the Pentagon. U.S. forces have supported South Korea since the Korean War, but Trump in the past has complained that Washington is not properly compensated for the cost of maintaining them. And administration pushes back on new reports on troop discussions: Prior to Trump’s comments on U.S. troops in the Korean peninsula, the White House on Friday strongly denied a New York Times story claiming the administration is talking to South Korea about reducing the troops stationed in that country. “The New York Times story is utter nonsense,” national security adviser John Bolton said in a statement. Bolton said the Pentagon has not discussed a troop drawdown with South Korea. US prisoners still hang in the balance: Trump also addressed the ongoing negotiations for the release of three U.S. prisoners in North Korea. "We're having very substantive talks with North Korea," Trump says. "And a lot of things have already happened, with respect to the hostages. And I think you're going to be seeing very good things. As I said yesterday: Stay tuned." Trump's comments come after erroneous reports on social media that claimed the Trump administration had secured the release of the three Americans. NAVY SEALS DISCHARGED OVER METH, COCAINE USE: Eleven Naval service members are being discharged after testing positive for cocaine and methamphetamines. Ten Navy SEALs and one sailor in Navy special warfare tested positive for the substances, according to Cmdr. Tamara Lawrence. "We have a zero-tolerance policy for the use of illicit drugs and as such these individuals will be held accountable for their actions," Lawrence said in the statement, according to Business Insider. A CBS investigation last April found that drug abuse in the elite military segment was “staggering.” Active and retired SEALs told CBS that speaking up about teammates’ drug use was considered a “career killer.” ON TAP FOR MONDAY The Center for Strategic and International Studies will hold a discussion on the results of the inter-Korean summit last month and its implications for the U.S.-North Korea summit in May, to begin at 8:45 a.m. in Washington, D.C. https://bit.ly/2uG6QmZ Lt. Gen. Jerry Harris, Air Force Deputy Chief of Staff, will give an analysis on Air Force operations at 9:30 a.m. at the Air Force Association  in Arlington, Va. https://bit.ly/2FLvAdF Sen. Ben Cardin with speak on the impact of sanctions on Russia’s economy and foreign policy at 1 p.m. at the Center for Strategic and International Studies in Washington, D.C. https://bit.ly/2JSLlSw ICYMI: — The Hill: Macron: Trump pulling out of Iran deal 'could mean war' — The Hill: State Dept. freezes funding for famed Syrian humanitarian group: report — The Hill: North Korea changes time zone to match South Korea — Defense News: The US Navy’s new command puts Russia in the crosshairs — Associated Press: China denies using lasers on US aircraft in Djibouti     Please send tips and comments to Rebecca Kheel, rkheel@thehill.com, and Ellen Mitchell, emitchell@thehill.com. Follow us on Twitter: @thehill, @Rebecca_H_K, @EllenMitchell23         Did a friend forward you this email? Sign up for Defense Newsletters     Forward Defense Newsletters       Privacy Policy  |  Manage Subscriptions  |  Unsubscribe  |  Email to a friend  |  Sign Up for Other Newsletters   The Hill 1625 K Street, NW 9th Floor, Washington DC 20006 ©2016 Capitol Hill Publishing Corp., a subsidiary of News Communications, Inc.

Overnight Health Care — Sponsored by PCMA — Drug pricing, opioids on tap next week | Vice president's physician resigns | South Carolina Senate blocks abortion ban bill in late-night vote

Sponsored by Pharmaceutical Care Management Association | View in Browser     Happy Friday! And welcome to Overnight Health Care, sponsored by the Pharmaceutical Care Management Association.  For next week, we’re putting together the clues to figure out what President Trump’s drug policy speech will entail. An array of opioid bills are set for mark-up before the full House Energy and Commerce Committee, and the panel’s investigative subcommittee will put pharmaceutical distributors in the hot seat. Health and Human Services Secretary Alex Azar will speak to hospitals and a House committee will put a spotlight on changes to veterans health care. But first, ICYMI on Friday:  Vice President Pence’s doctor resigned, the latest fallout from the scandal surrounding the failed nomination of Ronny Jackson, President Trump’s pick to lead the Department of Veterans Affairs. Jennifer Peña was a physician in the White House Medical Unit, which Jackson led prior to his nomination. Multiple reports said she was one of the people who accused Jackson of misconduct, which helped sink his bid to lead the VA. Read more here.   In South Carolina, the state Senate blocked legislation that would have implemented a wide-ranging ban on abortions early Friday night after a Democratic filibuster.  Read more here.   A trio of Democratic senators urged the Food and Drug Administration (FDA) to remove ultra-high dose opioids from the market as policymakers grapple with how to stem the tide of the opioid epidemic. But the proposal isn’t without controversy, with one pain group worrying pulling powerful opioids from the shelves would be unsafe for patients who need the medicines to manage their pain. Read more here.   Today is the one-year anniversary of the House passage of its ObamaCare repeal bill, the American Health Care Act. Three House Democratic committee leaders used that anniversary to call on Speaker Paul Ryan (R-Wis.) to hold a vote on their legislation to stabilize ObamaCare, called The Undoing Sabotage and Expanding Affordability of Health Insurance Act. Read more here.         SPONSORED CONTENT   Pharmaceutical Care Management Association Where PBM tools are used, a new report shows net spending – including the combined impact of drug prices, generic vs. brand drug use, and the overall number of prescriptions – declined by 2.1% last year. Spending increased in 2017 through channels not managed by PBMs. Learn how PBMs are part of the solution to reducing Rx costs at DrugBenefitSolutions.com.       Big week on drug prices President Trump’s big speech on actions on drug pricing is finally expected next week. It was originally slated for Tuesday, though now there are rumors it could be pushed until later in the week. No one seems to know exactly what will be proposed, but here are some possibilities we’re hearing: FDA Actions. Commissioner Scott Gottlieb hinted in a speech this week that he wants to issue guidance to crack down on delay tactics that slow cheaper generic drugs coming to market. Medicare Part B changes. The administration has floated these before, to make payments more efficient in this section of Medicare or shift some drugs into Medicare Part D, where there is more competition. One option, according to a lobbyist, is to revitalize a program called the competitive acquisition program, from the 2003 Medicare Modernization Act. Rebate changes. The administration could move forward with rumored actions on passing discounts and rebates on to consumers, something supported by drug companies. Surprises. No one is pretending they know exactly what the administration will announce. Next week: Bye recess, hello Congress. Opioids: Cities, counties, tribes and other health-care stakeholders have filed hundreds of lawsuits against pharmaceutical distributors, alleging they didn’t report suspicious quantities of opioids, sometimes shipped in large volumes to small, rural areas. In Kermit, W.Va., one pharmacy received nearly 9 million hydrocodone pills over two years. The town’s population: 392.   In statements about the lawsuits, the Healthcare Distribution Alliance has said: “Given our role, the idea that distributors are responsible for the number of opioid prescriptions written defies common sense and lacks understanding of how the pharmaceutical supply chain actually works and is regulated. Those bringing lawsuits would be better served addressing the root causes, rather than trying to redirect blame through litigation.” On Tuesday, a House Energy and Commerce subcommittee will get the chance to grill executives from the top distributors in a hearing billed as examining concerns about distribution and diversion. The panel has been investigating the issue for about a year. Key quote: “Through their testimony, we hope to gain a more complete picture of the crisis that unfolded in West Virginia and across our nation. As we work to develop solutions to combat the opioid crisis, we must fully understand the root causes of it,” Rep. Gregg Harper (R-Miss.), the subcommittee chairman, said in a video previewing the hearing. ALSO: The full House Energy and Commerce Committee has scheduled mark ups for over 50 opioid bills, the first of which will be Wednesday. The final committee mark up is slated for May 17, as the panel’s chairman, Rep. Greg Walden (R-Ore.), aims to put legislation to the House floor by Memorial Day weekend. Democrats balked at the timeline during a health subcommittee mark up last week, saying many of the bills were still in draft form and awaiting technical assistance.     VA health changes get scrutiny. It’s been somewhat lost in the high-profile controversy over Ronny Jackson, but the Veterans Choice Program is running out of money. The House Veterans Affairs Committee on Wednesday will mark up a bill that, among other things, would provide $5.2 billion to keep the Choice program funded. The Choice program was meant to be temporary. It was created in the wake of the 2014 wait-time scandal. It allows some veterans to see private doctors, but only in cases where they have to wait more than 30 days for an appointment or drive more than 40 miles to a facility. The issue: Reauthorizing Choice shouldn’t be a problem, but the legislation under consideration aims to create an entirely new program to allow veterans access to private-sector care paid for by the VA. It would eliminate the current waiting period and distance requirements and allow veterans to seek community care outside the VA if veterans and their providers agree it’s the best method of treatment. Will there be fireworks? According to Committee Chairman Phil Roe (R-Tenn.), the bill broadly includes the Senate’s language on community care and caregivers. It’s backed by all major veterans groups, included the Koch-backed Concerned Veterans for America. But a version of the legislation was supposed to be included in the recently passed omnibus spending package, and House Democrats blocked it because they were worried it would go too far towards privatizing the VA.         SPONSORED CONTENT   Pharmaceutical Care Management Association Pharmacy benefit managers (PBMs) have outlined several policy solutions to ensure patients receive opioid prescriptions when safe and medically appropriate. One important solution would be requiring e-prescribing of controlled substances in Medicare (S. 2460 / H.R. 3528, the Every Prescription Conveyed Securely Act). A new study by the Opioid Safety Alliance finds this could save taxpayers $13 billion over 10 years.       Other things we’re watching: Health and Human Services Secretary Alex Azar will speak on Wednesday at the American Hospital Association’s annual conference in Washington, D.C. Insurers will be filing their ObamaCare premium requests for 2019, and they’re expected to be higher than last year’s. Watch for both Democrats and Republicans to point fingers. What we’re reading The U.S. can't keep up with demand for health aides, nurses and doctors (CNN Money) ‘Pharma Bro’ Shkreli Is In Prison, But Daraprim’s Price Is Still High (Kaiser Health News) Gottlieb pushes back against criticism of ‘breakthrough’ designation (Stat News) State by state    States Aren’t Meeting Residents’ Mental Health Needs, Study Finds (US News and World Report) Here's what Iowa women are saying about the 'fetal heartbeat' abortion ban (Des Moines Register) New Hampshire House approves funds for DCYF, mental health services (The Concord Monitor)     Send tips and comments to Jessie Hellmann, jhellmann@thehill.com; Peter Sullivan, psullivan@thehill.com; Rachel Roubein, rroubein@thehill.com; and Nathaniel Weixel, nweixel@thehill.com. Follow us on Twitter: @thehill, @jessiehellmann, @PeterSullivan4, @rachel_roubein, and @NateWeixel.         Did a friend forward you this email? Sign up for Healthcare Newsletters     Forward Healthcare Newsletters       Privacy Policy  |  Manage Subscriptions  |  Unsubscribe  |  Email to a friend  |  Sign Up for Other Newsletters   The Hill 1625 K Street, NW 9th Floor, Washington DC 20006 ©2016 Capitol Hill Publishing Corp., a subsidiary of News Communications, Inc.

Overnight Finance: Unemployment drops to lowest since 2000 | Trump asks China to slash trade deficit $200B by 2020 | NJ gov signs bill to skirt GOP tax law provision

View in your browser     Happy Friday and welcome back to Overnight Finance, where we are celebrating Star Wars Day with a few laughs and a vigorous defense of Porgs. I’m Sylvan Lane, and here’s your nightly guide to everything affecting your bills, bank account and bottom line. See something I missed? Let me know at slane@thehill.com or tweet me @SylvanLane. And if you like your newsletter, you can subscribe to it here: http://bit.ly/1NxxW2N.   THE BIG DEAL: The U.S. economy added 164,000 jobs in April, a modest number that was less than expected as the nation’s labor market maintains a steady rate of growth.  The unemployment rate fell to 3.9 percent – the lowest level since December 2000 – from 4.1 percent in March, where it had held for six months, the Labor Department reported on Friday. Analysts expected an April gain of about 190,000 jobs. The economy is maintaining growth even as President Trump’s threats of steep tariffs on China and some U.S. allies have unnerved businesses and stock markets, injecting uncertainty into the economy. The Hill’s Vicki Needham breaks down the data for us here.   Wage growth still lags: With a tightening labor market, job growth is expected to slow down somewhat as the unemployment rate drops into the rarely seen 3-4 percent range.  And wage growth remains stubborn, while companies have been slow to raise wages despite getting a boost to their bottom lines from the GOP's tax-cut bill. Businesses continue to complain that they can’t find enough qualified workers to fill openings. In April, average hourly earnings were up 2.6 percent for the year. Jason Furman, former head of the Council of Economic Advisers under President Obama who now teaches at Harvard, said that while the 3.9 percent unemployment rate “is positively exciting,” the slow rate of pay increases is “pretty disappointing.” Robert Frick, corporate economist with the Navy Federal Credit Union, said the slower pace of wage growth shows that “workers are not sharing in the expansion as they should, and that has consequences for the expansion given two-thirds of [gross domestic product] is consumer spending.” “We need wage increases well above 3 percent for consumer spending to accelerate at a healthy pace,” Frick said.   Reactions: “JUST OUT: 3.9% Unemployment. 4% is Broken! In the meantime, WITCH HUNT!” — President Trump “The percent of the labor force that is working part-time for economic reasons has been hovering around 3.1 percent for a few months, which may mean that recovery in this measure is stalling out.” — Martha Gimbel, director of economic research at Indeed “The Trump administration’s govern-by-chaos mentality is continuing to put unnecessary burdens on working families. His policies are creating stagnant wages and shrinking markets for American agricultural goods overseas.” — Rep. Joe Crowley (D-N.Y.), House Democratic Caucus chairman “With the lowest unemployment rate since 2000, this report shows an expanding economy – which was our goal when Republicans passed pro-growth tax reform.” — Rep. Kevin Brady (R-Texas), chairman of the House Ways and Means Committee. “April’s job report shows our continued economic strength built on what President Obama left to his successor: a combination of declining deficits and robust job growth.” — Rep. Steny Hoyer (D-Md.), House minority whip. “The bad news is that there was no measured employment growth in the household sector; the decline in the unemployment rate was solely because the labor force fell by 236,000 and labor force participation dipped to 62.8 percent.” — Douglas Holtz-Eakin, former director of the Congressional Budget Office.   ON TAP NEXT WEEK Monday: North American Free Trade Agreement (NAFTA) re-negotiation meetings resume. The Federal Deposit Insurance Corporation (FDIC) hosts a forum on the use of technology in the business of banking, 9 a.m. House Rules Committee: Meeting on three bills including the Senate resolution to repeal the Consumer Financial Protection Bureau’s 2013 guidance on auto-lending, 5 p.m. Tuesday: Brookings Institution hosts an event on the future of the middle class featuring a speech from former Vice President Joe Biden, 9 a.m. The Heritage Foundation hosts an event on “the case for reforming farm subsidies,” 12 p.m. Wednesday: American Enterprise Institute hosts an event on threats to U.S. community banks featuring Rep. Blaine Luetkemeyer (R-Mo.), 8:30 a.m. House Education and the Workforce Committee: Hearing entitled “Closing the Skills Gap: Private sector solutions for America's workforce,” 10 a.m. House Oversight and Government Reform Committee: Hearing entitled “Program Integrity for the Supplemental Nutrition Assistance Program,” 10 a.m. House Ways and Means Committee: Hearing entitled “Jobs and Opportunity: Legislative Options to Address the Jobs Gap,” 10 a.m. Thursday: Brookings Institution hosts an event on economic mobility across generations around the world, 10:30 a.m.   NEXT WEEK’S NEWS, NOW House to vote on repeal of Consumer Financial Protection Bureau auto lending guidance: The House is likely to vote this week to repeal the CFPB’s controversial 2013 guidance on auto loans. A measure to repeal the CFPB’s attempt to weed out “dealer markups,” the additional interest added by an auto-dealer to a third-party loan as extra compensation, passed the Senate on April 18. The House vote to repeal, as we reported in April, will likely pass along party lines. Trump is expected to sign the measure and strike a precedent-setting blow to informal federal legal guidance. I’ve got more here on why that’s important.    NAFTA talks resume: U.S. Trade Representative Robert Lighthizer is scheduled Monday to meet his counterparts in the North American Free Trade Agreement (NAFTA) on Monday, with the administration hoping to complete talks on a revised deal this month. Lighthizer is scheduled to meet with Canadian Foreign Minister Chrystia Freeland and Mexican Economy Minister Ildefonso Guajardo. “If we can get a good agreement, I’d like to get it done a week or two after that. If not, then you start having a problem,” Lighthizer told the U.S. Chamber of Commerce on Tuesday.   GOOD TO KNOW President Trump's trade representatives presented Chinese officials with a document Friday asking China's government to reduce its trade deficit with the U.S. by $200 billion by the end of 2020.   The Washington Post explores why Trump’s trade requests to China amount to changing “just about everything” in its economy. More than half of the combined net-income growth reported by 200 large public companies for the first quarter stemmed from a decline in the companies’ effective tax rates, according to a Wall Street Journal analysis.   Bloomberg explores the backlash Citigroup and Bank of America is facing from Washington Republicans over their gun policies. Speaking of which, Sen. Ted Cruz (R-Texas) fired off a letter to both of the banks excoriating them for their decisions and demanding answers about the new policies. The government of Qatar bought a $6.5 million apartment in one of Trump’s New York towers soon after the dismissal of a lawsuit that tried to stop the president benefiting from such deals, according to The Guardian.   New Jersey Gov. Phil Murphy (D) on Friday signed legislation providing a workaround to a controversial provision in the new federal tax law Trump signed late last year.   ODDS AND ENDS Kevin Warsh, a former Federal Reserve governor once considered by Trump to lead the Fed, said the central bank should consider getting involved in cryptocurrency. White House adviser Jared Kushner has made additional mistakes on his financial ethics disclosure forms, this time regarding two loans for properties in Brooklyn. Recapping the week with Overnight Finance: Monday:  Banks close in on Dodd-Frank relief | Inflation reaches threshold for Fed rate hikes | Rubio undercuts GOP tax message | Closing arguments in AT&T trial Tuesday: Trump delays tariffs for key trading partners | Dems want investigation into Mulvaney lobbyist remarks | Trump lawyer Cohen hit with $282K tax bill | Apple plans $100B stock buyback Wednesday: Fed holds rates steady but sees inflation rise | Crucial month ahead for Trump on trade | US businesses added 204K jobs in April | Lawmakers eye new powers for panel on foreign investment  Thursday: Trump trade agenda at crossroads | White House to request $11B in spending cuts | SEC subpoenas Jay-Z | Company drops legal challenge to consumer bureau     Write us with tips, suggestions and news: slane@thehill.com, vneedham@thehill.com, njagoda@thehill.com, and nelis@thehill.com. Follow us on Twitter: @SylvanLane,  @VickofTheHill, @NJagoda, and @NivElis.         Did a friend forward you this email? Sign up for Finance Newsletters     Forward Finance Newsletters       Privacy Policy  |  Manage Subscriptions  |  Unsubscribe  |  Email to a friend  |  Sign Up for Other Newsletters   The Hill 1625 K Street, NW 9th Floor, Washington DC 20006 ©2016 Capitol Hill Publishing Corp., a subsidiary of News Communications, Inc.