Health Care Watch: October 14, 2024
The following Federal Health Policy (FHP) Strategies Weekly Health Care Watch provides a summary of legislative and regulatory health care activities from October 6 – October 12. Where available, hyperlinks are included to the relevant documents. Please let us know if you have any questions or would like additional information on the items below.
LEGISLATIVE UPDATE
House
On October 8, a bipartisan group of Energy & Commerce Committee members sent a letter to Food & Drug Administration (FDA) Commissioner Dr. Robert Califf expressing concern about the presence of counterfeit Ozempic in the U.S. supply chain for semaglutide products and to request a Committee staff briefing on the public health and investigative response by the FDA.
Senate
On October 9, Finance Committee Chairman Ron Wyden (D-OR) sent a letter to the Department of Justice (DOJ) asking it to investigate whether four major youth residential treatment facilities (RTFs) are committing Medicaid fraud by failing to provide needed care that is required to be provided to all Medicaid beneficiaries. The letter also asks that DOJ investigate whether states are violating the civil rights of children and youth by placing them in facilities rather than providing access to community-based care.
REGULATORY UPDATE
On October 4, the Administration for Strategic Preparedness and Response’s (ASPR) Center for Biomedical Advanced Research and Development Authority (BARDA) announced the provision of approximately $72 million to CSL Seqirus, Sanofi, and GSK to complete the next steps in influenza A(H5) vaccine manufacturing.
On October 7, FDA granted marketing authorization for the Healgen Rapid Check COVID-19/Flu A&B Antigen Test. The test, authorized for use without a prescription, is for use by individuals experiencing respiratory symptoms and uses a nasal swab sample to deliver at-home results in approximately 15 minutes for COVID-19 and influenza. The test detects proteins from both SARS-CoV-2 and influenza A and B.
On October 7, the Centers for Medicare & Medicaid Services (CMS) released a JYNNEOS coverage fact sheet following the Centers for Disease Control and Prevention’s (CDC) Advisory Committee on Immunization Practices (ACIP) recommended vaccination with the 2-dose JYNNEOS vaccine series for persons aged 18 years and older at risk for mpox. The fact sheet details Medicaid, Children’s Health Insurance Program (CHIP), Medicare, and private insurance coverage of the vaccine.
On October 8, CMS’ Center for Medicare and Medicaid Innovation (CMMI) released a Request for Information (RFI)and a sample list of prescription drugs that the agency preliminarily intends to include under the proposed Medicare $2 Drug List (M2DL) Model. The M2DL Model aims to test whether a simplified approach to offering low-cost, clinically important generic drugs can improve medication adherence, lead to better health outcomes, and improve satisfaction with the Part D prescription drug benefit among people with Medicare and prescribers. The goal of the RFI is to inform the development of the model in order to maximize beneficiary access to low-cost generic drugs. A fact sheet detailing the M2DL Model can be found here. Comments are due by December 9, 2024, and can be made here.
On October 8, CVS Health, UnitedHealth Group, and Cigna filed separate motions with the Federal Trade Commission (FTC) to disqualify top FTC officials from participating in the agency’s lawsuit against the companies. The filings ask that FTC disqualify Commission Chair Lina Khan and Commissioners Rebecca Kelly Slaughter and Alvaro Bedoya due to a history of the individuals publicly criticizing PBMs which the filings indicate as “serious bias” against the companies.
On October 9, Department of Health & Human Services (HHS) Secretary Xavier Becerra sent a letter to health care leaders and stakeholders on the impacts of hurricane Helene. The letter states that the impacts of Hurricane Helene have led to the temporary supply disruption at the Baxter facility in Marion, North Carolina that provides a significant portion of IV solutions, irrigation fluids, and peritoneal solutions to the U.S. medical system. Secretary Becerra stated that HHS is coordinating a U.S. Government-wide response to address supply chain disruptions as well as working with public and private partners to support the supply chain while the Baxter facility is brought back to full operational capacity. The letter encourages manufacturers, wholesalers, and distributors to evaluate product allocation and healthcare providers to implement product conservation strategies to maintain safe, quality patient care and maximize available supply.
On October 9, FDA announced that it will allow Baxter to ship certain IV fluids from its plants in Canada, Ireland, China, and Great Britain in an effort to ease shortages caused by the temporary shutdown of its North Carolina facility due to damage from hurricane Helene.
On October 10, CMS released the 2025 Medicare Advantage and Part D Star Ratings. Approximately 40% of MA-PDs (209 contracts) that will be offered in 2025 earned four stars or higher for their 2025 overall rating. Weighted by enrollment, approximately 62% of MA-PD enrollees are currently in contracts that will have four or more stars in 2025. There were no major methodological changes in the 2025 Star Ratings, however, minor methodological changes were included for 2025, such as increasing the weight for the Part C Plan All-Cause Readmissions measure from one to three. All Star Rating data can be found here.
On October 10, the Advanced Research Projects Agency for Health (ARPA-H) announced funding of the Pro/Prebiotic Regulation for Optimized Treatment and Eradication of Clinical Threats (PROTECT) project. PROTECT aims to leverage beneficial bacteria to outcompete harmful bacteria, preventing or quickly treating infections before they can take hold or develop antibiotic resistance. PROTECT aims to develop a generalizable platform for combatting antimicrobial resistance, beginning with an at-home, inhalable treatment for infections ofPseudomonas aeruginosa, a bacterium that can cause severe infection and lung damage in people with cystic fibrosis or pneumonia.
On October 10, FDA’s Cardiovascular and Renal Drugs Advisory Committee voted 10-6 to recommend Stealth Biotherapeutics’ elamipretide for treating Barth syndrome, an X-linked genetic disorder that weakens the heart and other muscles.
On October 10, FDA issued an exemption from the enhanced drug distribution security requirements of section 582 of the Food, Drug & Cosmetic Act for eligible trading partners. The exemption is part of the agency’s broader efforts to avoid supply chain disruptions and ensure patients will not face delays in receiving the medicines they need. The duration of the exemption varies depending on the eligible trading partners: manufacturers and repackers have until May 28, 2025, wholesale distributors have until August 27, 2025, and dispensers with 26 or more full-time employees have until November 27, 2025.
WHITE HOUSE
On October 8, the Biden Administration announced that over 250 organizations, businesses, and stakeholders across the country have made voluntary commitments to the White House Challenge to Save Lives from Overdose. The Challenge, launched earlier this year, is a nationwide call-to-action to stakeholders across all sectors to increase training on, and access to, life-saving opioid overdose reversal medications like naloxone.
On October 8, the Harris-Walz Campaign released a fact sheet detailing a policy which would expand home health care under Medicare as well as hearing and vision benefits. The policy aims to strengthen Medicare home care services by providing independent evaluations, tailoring home care services to beneficiaries, and working with the private sector to draw upon best practices for at-home care. The fact sheet states that the new benefits will be fully paid for and extend the life of the Medicare Trust Fund by expanding Medicare drug price “negotiations,” increasing the discounts drug manufacturers cover for certain brand-name drugs in Medicare and addressing Medicare fraud.
RULES AT THE WHITE HOUSE OFFICE OF MANAGEMENT & BUDGET (OMB)
Pending Review
CMS
Healthcare System Resiliency and Modernization (CMS-3426); Proposed Rule; 10/12/23
Administrative Simplification: Modifications to NCPDP Retail Pharmacy Standards (CMS-0056); Final Rule; 6/27/24
Amendments to Rules Governing Organ Procurement Organizations (CMS-3409); Proposed Rule; 8/8/24
Contract Year 2026 Policy and Technical Changes to the Medicare Advantage, Medicare Prescription Drug Benefit, and Medicare Cost Plan Programs, and PACE (CMS-4208); Proposed Rule; 9/20/24
Alternative Payment Model Updates; Increasing Organ Transplant Access (IOTA) Model (CMS-5535); Finale Rule; 9/20/24
CY 2025 Revisions to Payment Policies Under the Physician Fee Schedule and Other Revisions to Medicare Part B (CMS-1807); Final Rule; 9/25/24
CY 2025 Hospital Outpatient PPS Policy Changes and Payment Rates and Ambulatory Surgical Center Payment System Policy Changes and Payment Rates (CMS-1809); Final Rule; 9/25/24
CY 2025 Home Health Prospective Payment System Rate Update and Home Infusion Therapy and Home IVIG Services Payment Update (CMS-1803); Final Rule; 10/1/24
CY 2025 Changes to the End-Stage Renal Disease (ESRD) Prospective Payment System and Quality Incentive Program (CMS-1805); Final Rule; 10/3/24
FDA
Expedited Program for Serious Conditions--Accelerated Approval of Drugs and Biologics; Draft Guidance for Industry; Availability; Notice; 7/9/24
Marketing Submission Recommendations for a Predetermined Change Control Plan for Artificial Intelligence-Enabled Device Software Functions; Guidance for Industry and Food and Drug Administration Staff; Notice; 8/26/24
Nonprescription Drug Product With an Additional Condition for Nonprescription Use; Final Rule; 9/24/24
Notifying the Food and Drug Administration of a Permanent Discontinuance in the Manufacture or an Interruption of the Manufacture of an Infant Formula; Draft Guidance for Industry; Notice; 9/26/24
Considerations for Including Biopsies in Clinical Trials; Draft Guidance for Industry, Investigators, Institutions, and Institutional Review Boards; Notice; 9/27/24
Transitional Enforcement Policy for Ethylene Oxide Sterilization Facility Changes for Class III Devices; Guidance for Industry and Food and Drug Administration Staff; Availability; Notice; 10/2/24
Temporary Policies for Compounding Certain Large Volume Parenteral Drug Products for Hospitals (2024-742); Notice; 10/10/24
REPORTS
Congressional Budget Office (CBO)
On October 7, CBO released a report examining alternative approaches to reducing prescription drug prices. Some of the approaches examined by CBO aim to reduce prescription drug prices by capping them or limiting their growth; others would reduce prices by promoting price competition or affecting the flow of information. One examined approach, which would set maximum allowed prices based on prices outside the U.S., would reduce prices by more than 5% — and possibly substantially more. CBO found that an approach that expanded the Medicare Drug Price Negotiation Program would lead to a small reduction (1% to 3%) in average prices. An approach requiring manufacturers to pay inflation rebates for sales in the commercial market would also lead to a small price reduction. CBO also examined four additional approaches that would lead to a very small price reduction, no reduction, or a price increase: 1) allow commercial importation of prescription drugs distributed outside the U.S.; 2) eliminate or limit direct-to-consumer prescription drug advertising; 3) facilitate earlier market entry for generics and biosimilar drugs; or 4) increase transparency in brand-name drug prices. CBO concluded by stating that reducing drug prices would save money for patients and payers, but reducing manufacturers’ expected revenue from drugs that are not yet on the market would make investments in pharmaceutical research and development less profitable, thus decreasing the number of new drugs developed and introduced.
On October 8, CBO released a report examining how authorizing Medicare to cover anti-obesity medications (AOM) would affect the federal budget. CBO found that authorizing coverage of AOMs in Medicare would increase federal spending, on net, by about $35 billion from 2026 to 2034. Total direct federal costs of covering AOMs would increase from $1.6 billion in 2026 to $7.1 billion in 2034, and relative to the direct costs of the medications, total savings from beneficiaries’ improved health would be small—less than $50 million in 2026 and rising to $1.0 billion in 2034. CBO also stated that beyond 2034, the policy’s net federal costs to the Medicare program would probably be lower on a per-user basis than in the first decade, but CBO expects that the cost of the drugs will fall over time and that the savings from improved health will grow over time.
Office of Inspector General (OIG)
On October 9, OIG released a report examining Massachusetts oversight of nursing home compliance with federal requirements for life safety, emergency preparedness, and infection control. OIG identified 236 deficiencies related to life safety, emergency preparedness, or infection control at the 20 nursing homes in Massachusetts that were reviewed. OIG stated that the deficiencies put the health and safety of residents, staff, and visitors at an increased risk of injury or death during a fire or other emergency, or in the event of an infectious disease outbreak. OIG recommends that Massachusetts improve the health and safety of residents, staff, and visitors at nursing homes, including that it follows up with the 20 nursing homes where deficiencies were identified to ensure that they have taken corrective actions. OIG also recommends that Massachusetts work with CMS to identify nursing homes requiring frequent inspections.
ADDITIONAL HEALTH POLICY NEWS
On October 7, the American Hospital Association (AHA) sent a letter to President Biden asking the Administration to declare a shortage of sterile IV solutions. The letter comes as a North Carolina factory responsible for producing most of the IV solution sent to hospitals remains offline due to damage from hurricane Helene. The letter states that many of AHA’s members are already reporting substantial shortages of these products.
On October 8, the Outsourcing Facilities Association, a trade group representing compounding outsourcing facilities that have made copies of popular diabetes and weight-loss drugs for nearly two years, filed a lawsuit against FDA. The lawsuit argues that FDA should have conducted notice-and-comment rulemaking when pulling tirzepatide — the active ingredient in Lilly’s Mounjaro and Zepbound – from its shortage list on October 2.