Health Care Watch: February 4, 2024
The following Federal Health Policy (FHP) Strategies Weekly Health Care Watch provides a summary of legislative and regulatory health care activities from January 28 – February 4. 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 January 31, the Energy & Commerce Health Subcommittee held a hearing entitled Health Care Spending in the United States: Unsustainable for Patients, Employers, and Taxpayers. The hearing contained testimony from expert witnesses and examined ways to lower health care costs through policies such as Medicare Advantage (MA) reform, site-neutral payment, and increased transparency.
The week of February 4, the House will consider H.R. 485, Protecting Health Care for all Patients Act of 2023, which would prohibit federal health care programs from using quality-adjusted life years when making coverage and payment decisions.
Democrats will hold their issues conference retreat on February 7-9.
Senate
On January 29, a group of 60 bipartisan Senators, led by Sens. Catharine Cortez Masto (D-NV) and Tim Scott (R-SC), sent a letter to Centers for Medicare & Medicaid Services (CMS) Administrator Chiquita Brooks-LaSure urging CMS to protect and strengthen MA. The letter asks for more transparency on coverage options and encourages efforts to increase affordability and accessibility of the program while cracking down on deceptive marketing practices.
On January 29, Sen. Tammy Baldwin (D-WI) sent letters to the four biggest inhaler companies - AstraZeneca, Boehringer Ingelheim, GlaxoSmithKline (GSK), and Teva - asking them to stop improperly listing patents for inhalers in the Food & Drug Administration’s (FDA) Orange Book. The letter asks that the companies remove improperly listed patents from the Orange Book in order to allow for generic manufacturers to enter the market.
On January 30, 263 Members of Congress, led by Senator Chuck Schumer (D-NY), submitted an amicus brief to the U.S. Supreme Court in the case of Alliance for Hippocratic Medicine v. FDA, urging the Supreme Court to reverse a stay from Texas District Court Judge Matthew Kacsmaryk that would curtail access to mifepristone —an abortion drug approved by FDA in 2000.
On January 31, the Finance Committee voted 14-13 to favorably nominate Rebecca Lee Haffajee to serve as an Assistant Secretary of the Department of Health and Human Services (HHS).
On February 1, a group of bipartisan senators, led by Minority Whip John Thune (R-SD) and Sen. Debbie Stabenow (D-MI), released draft legislation aimed at reforming the 340B program. The draft legislation addresses rules over providing discounts to contract pharmacies, the “patient” definition (in light of the Genesis court decision), which subsidiaries can qualify for discounts, and Health Resources and Services Administration (HRSA) oversight of the 340B program (funded through a new user fee program). Additionally, the discussion draft serves as a Request for Information (FRI), allowing interested parties to provide feedback on sections and questions within the document.
REGULATORY UPDATE
On January 29, CMS announced increased participation in its Accountable Care Organization (ACO) initiatives in 2024. CMS announced that 19 newly formed ACOs in the Medicare Shared Savings Program are participating in a new, permanent payment option beginning in 2024 that is enabling these ACOs to receive more than $20 million in advance investment payments (AIPs) for caring for underserved populations. An additional 50 ACOs are new to the program in 2024, and 71 ACOs renewed their participation, bringing the total to 480 ACOs now participating in the Shared Savings Program.
On January 29, FDA revised the Emergency Use Authorization (EUA) for Paxlovid to continue to facilitate the transition from the government’s distribution of Paxlovid labeled for use under the EUA to Pfizer’s distribution of the commercial (NDA-labeled) Paxlovid. FDA’s full statement can be found here.
On January 29, HHS released a readout of HHS officials meeting with representatives from leading patient advocacy organizations, provider groups, and health insurers to discuss solutions that help guarantee nationwide access to medications that help manage asthma and eosinophilic esophagitis in children. During the meeting, participants discussed how their members are encountering access issues, including confusion at the pharmacy counter when parents are picking up their kids’ asthma medication and high out-of-pocket costs for authorized alternatives to Flovent, and how drug companies’ decisions to discontinue their products is affecting patients.
On January 30, CMS’ Center for Medicare & Medicaid Innovation (Innovation Center) announced that sickle cell disease (SCD) will be the first focus of the new Cell and Gene Therapy (CGT) Access Model. The voluntary model is designed to improve health outcomes, increase access to cell and gene therapies, and lower health care costs. Over the next year, CMS will partner with participating states and manufacturers to build a framework that expands access to gene therapies for the treatment of SCD. Under the model, CMS will negotiate an outcomes-based agreement (OBA) with participating manufacturers, which will tie pricing for SCD treatments to whether the therapy improves health outcomes for people with Medicaid. Negotiations will also include additional pricing rebates and a standardized access policy. A fact sheet detailing the CGT Access Model can be found here.
On January 30, HHS announced the establishment of the National Syphilis and Congenital Syphilis Syndemic (NSCSS) Federal Task Force. The actions of the Task Force will aim to leverage federal resources to reduce syphilis rates, promote health equity, engage impacted communities and direct resources to support those most impacted.
On January 31, CMS released the Calendar Year (CY) 2025 Advance Notice for the Medicare Advantage (MA) and Medicare Part D Prescription Drug Programs that would update payment policies for these programs. Under the Advance Notice, MA payments from the government to MA plans are expected to increase on average by 3.7%, or over $16 billion, from 2024 to 2025. CMS proposes to proceed with the phase-in of the Part C Risk Adjustment Model by blending 67% of the risk score calculated using the updated 2024 MA risk adjustment model with 33% of the risk score calculated using the 2020 MA risk adjustment model. This blended MA risk score trend for CY 2025 is 3.86%. CMS also issued Draft CY 2025 Part D Redesign Program Instructions for implementation of Inflation Reduction Act (IRA) policies related to redesigning Part D. Comments on the Advance Notice and the draft program instructions are due by March 1, 2024. A fact sheet detailing the Advance Notice can be found here. A fact sheet detailing the draft program instruction can be found here.
On January 31, HHS’ Office of the Assistant Secretary for Planning and Evaluation (ASPE) released three studies analyzing data on U.S. prescription drug prices and availability in comparison to drug prices and availability in other Organization for Economic Co-operation and Development (OECD) countries. According to the studies, in 2022, U.S. prices across all drugs (brands and generics) were nearly 2.78 times as high as prices in the comparison countries. U.S. prices for brand drugs were at least 3.22 times as high as prices in the comparison countries, even after adjustments for estimated U.S. rebates.
On January 31, ASPE also released new research detailing how the IRA expanded the financial protection available through the Low-Income Subsidy (LIS) Program for Medicare beneficiaries enrolled in prescription drug coverage. The research found that the IRA’s expanded financial assistance in Medicare’s LIS Program would have benefited almost 461,000 partial LIS enrollees had the provision been in effect in 2020. An additional 2.9 million Part D enrollees who were eligible but not enrolled in LIS could also have benefited.
On January 31, HHS released actions that the department and administration are taking to strengthen Medicare, including: establishing new guardrails to address predatory MA marketing; proposing new standards for plan compensation to agents and brokers to prevent steerage of patients to plans based on compensation; lowering drug costs; and increasing payments.
On February 1, HHS celebrated two years of its Overdose Prevention Strategy (Strategy) by announcing new actions to combat overdoses. These actions include finalizing the Medications for the Treatment of Opioid Use Disorder final rule that will expand access to medication-assisted treatment (MAT) with methadone for opioid use disorder and allow for providers to prescribe buprenorphine through telehealth without an in-person visit. HHS also announced that certain grant funds may now be used to purchase xylazine test strips (XTS) and released the Substance Abuse and Mental Health Services Administration’s (SAMHSA) updated Overdose Prevention and Response Toolkit. A list of 2023 Overdose Prevention Strategy accomplishments can be found here.
On February 1, HHS, through CMS, sent initial offers to the participating drug companies of the first 10 prescription drugs selected for negotiation in the first cycle of the Medicare Drug Price Negotiation Program. Drugmakers can accept the prices or negotiate with CMS before a final price is set by September 1, 2024.
On February 2, HHS, through SAMHSA, announced notices of funding opportunities for two grant programs aimed at expanding substance use disorder (SUD) treatment services among pregnant and postpartum women and through adult and family treatment drug courts. The grant opportunities total about $28 million and include grants to Expand Substance Use Disorder Treatment Capacity in Adult and Family Treatment Drug Courts (SAMHSA Treatment Drug Courts) – $24.4 million – and State Pilot Grant Program for Treatment for Pregnant and Postpartum Women – $3.6 million.
WHITE HOUSE
On February 1, President Biden released a statement on the Medicare drug price negotiation process. President Biden stated his commitment to continue negotiations with drug manufacturers and to lowering drug costs for Americans. His full statement can be found here.
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
Alternative Payment Model Updates; Increasing Organ Transplant Access (IOTA) Model (CMS-5535); Proposed Rule; 11/9/23
Disproportionate Share Hospital (DSH) Third Party Payer (CMS-2445); Final Rule; 12/8/23
Streamlining the Medicaid, CHIP, and BHP Application, Eligibility Determination, Enrollment, and Renewal Processes (CMS-2421); Final Rule’ 12/19/23
Medicaid and Children's Health Insurance Program (CHIP) Managed Care Access, Finance, and Quality (CMS-2439); Final Rule; 12/20/23
Ensuring Access to Medicaid Services (CMS-2442); Final Rule; 1/26/24
Hospital Inpatient Prospective Payment Systems for Acute Care Hospitals; the Long-Term Care Hospital Prospective Payment System; and FY 2025 Rates (CMS-1808); Proposed Rule; 1/31/24
FDA
Drug Products or Categories of Drug Products That Present Demonstrable Difficulties for Compounding Under Sections 503A or 503B of the Federal Food, Drug, and Cosmetic Act; Proposed Rule; 8/29/23
ONC
Health Data, Technology, and Interoperability: Patient Engagement, Information Sharing, and Public Health Interoperability; Proposed Rule; 1/18/24
UPCOMING HEARINGS
House
Ways and Means Committee
February 6; 10:00 AM; 1100 Longworth
Hearing on Examining Chronic Drug Shortages in the United States
Witnesses: Stephen Schleicher, MD, Chief Medical Officer, Tennessee Oncology; Eugene Cavacini, Senior Vice President and Chief Operating Officer, McKesson Pharmaceutical Solutions & Services; Allan Coukell, Senior Vice President for Public Policy, Civica Rx; Stephen Schondelmeyer, Director of the PRIME Institute, University of Minnesota’s College of Pharmacy; Julie Gralow, MD, Chief Medical Officer and Executive Vice President, ASCO; Jeromie Ballreich, Associate Research Professor, Johns Hopkins Bloomberg School of Public Health.
Energy and Commerce Committee
Oversight and Investions Subcommittee
February 6; 10:30 AM; 2322 Rayburn
Protecting American Health Security: Oversight of Shortcomings in the FDA's Foreign Drug Inspection Program
Witnesses: Dinesh Thakur, Public Helath Activist, Thakur Family Foundation, Inc.; John Claud, Counsel, Hyman, Phelps & McNamara; Mary Denigan-Macauley, Director of Public Health, GAO.
The hearing memo can be found here.
Senate
HELP Committee
February 8; 10:00 AM; SD-430
Why Does the United States Pay, by Far, the Highest Prices in the World for Prescription Drugs?
Witnesses: Joaquin Duato, CEO, Johnson & Johnson; Robert Davis, CEO, Merck; Chris Boerner, CEO, Bristol Myers Squibb
Finance Committee
February 8; 10:00 AM; 215 Dirksen
Artificial Intelligence and Health Care: Promise and Pitfalls
Witnesses: Peter Shen, Head of Digital & Automation For North America, Siemens Healthineers; Mark Sendak, MD, Co-Lead, Health AI Partnership; Michelle Mello, Professor Of Health Policy and of Law, Stanford University; Ziad Obermeyer, MD, Associate Professor and Blue Cross of California Distinguished Professor, University of California – Berkeley; Katherine Baicker, Provost, University of Chicago
OTHER POLICY NEWS
On January 29, the Supreme Court announced that they have set March 26 as the date for oral arguments in the case of FDA v. Alliance for Hippocratic Medicine. The case will decide the availability of mifepristone for medication abortion.
On January 31, Biogen announced that it will discontinue development and marketing for Alzheimer's disease treatment Aduhelm. After an internal review of its research and development efforts, Biogen determined that it should redirect its resources toward developing other drug candidates and advancing Leqembi.