Health Care Watch: July 30, 2023
The following Federal Health Policy (FHP) Strategies Weekly Health Care Watch provides a summary of legislative and regulatory health care activities from July 23 – July 30. 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 July 25, the House passed two health care–related bills by voice vote. Specifically, H.R. 3203, the Stop Chinese Fentanyl Act, would sanction Chinese chemical manufacturers and officials who fail to combat synthetic opioid trafficking, and H.R. 2544, the Securing the U.S. Organ Procurement and Transplantation Network Act, which aims to make the U.S. organ transplant network more competitive by authorizing the Health Resources and Services Administration (HRSA) to award contracts to multiple bidders and eliminate the cap on contracts, passed the House.
On July 25, Rep. Mike Carey (R-OH) introduced the Imaging Services Price Transparency Act. The legislation would require hospitals and other medical providers to make public the cost of imaging services, like x-ray, MRI, and CT scans.
On July 25, Rep. Carol Miller (R-WV) introduced the Clinical Laboratory Price Transparency Act. The legislation would require clinical labs to publish their health care prices and the Centers for Medicare & Medicaid Services (CMS) to monitor compliance.
On July 26, the Ways and Means Committee approved a health care package on a party-line vote. The legislation includes proposals that promote price transparency among hospitals, health plans and pharmacy benefit managers (PBMs), require prior authorization from Medicare Advantage plans to be handled electronically, and implement site-neutral Part B drug payment policies that ensure patients pay the same for a service regardless of where it is performed.
On July 26, Energy & Commerce Committee Ranking Member Frank Pallone (D-NJ), Ways & Means Committee Ranking Member Richard Neal (D-MA), and Education & the Workforce Committee Ranking Member Bobby Scott (D-VA) introduced the Lowering Drug Costs for American Families Act. The legislation would extend the negotiated in Medicare to employer-sponsored health plans and plans offered on the state insurance marketplaces. The legislation would also allow the government to negotiate lower prices for up to 50 drugs and allow for Medicare drug rebates required under the Inflation Reduction Act (IRA) to apply to private plans.
The House is in recess until September 5.
Senate
On July 25, Health, Education, Labor & Pensions (HELP) Committee Chairman Bernie Sanders (I-VT) postponed a markup of primary care legislation. Chairman Sanders has stated that committee members intend to have a “major piece of bipartisan legislation ready by the first week of September.”
On July 26, the Finance Committee approved a legislative package that aims to require more transparency from PBMs. The legislation, which advanced with a 26-1 vote, would place new requirements on contracts between Medicare Part D plan sponsors and PBMs, impose transparency requirements on PBMs, delink certain payments that PBMs receive from the price of a drug, and ban spread pricing in the Medicaid program.
On July 27, the Appropriations Committee approved the Fiscal Year (FY) 2024 Labor, Health and Human Services, Education, and Related Agencies Appropriations Bill. Committee members voted 26-2 to approve the bill which provides $117 billion to the U.S. Department of Health and Human Services (HHS) in FY 2024.
On July 27, the Senate passed S. 1668, the Securing the U.S. Organ Procurement and Transplantation Network Act which aims to break up the contract used to manage the Organ Procurement and Transplantation Network (OPTN) and reform the current organ procurement and transplant system. The House passed a companion bill by unanimous consent. The legislation now heads to President Biden for final approval.
REGULATORY UPDATE
On July 25, the Departments of Labor, HHS, and the Treasury issued a proposed rule entitled Requirements Related to the Mental Health Parity and Addiction Equity Act (MHPAEA). The proposed rule reinforces MHPAEA and would mandate that insurers analyze the outcomes of their coverage to help ensure there is equivalent access to mental health care, establish when health plans cannot use prior authorization or other tactics to make it more difficult to access mental health and substance use treatment, and require additional insurers to comply with MHPAEA. A fact sheet on the proposed rule can be found here. Comments are due 60 days after the proposed rule is published in the federal register.
On July 25, CMS announced a webinar entitled Promising Practices for Utilizing Motivational Interviewing to Improve Care Coordination and Address Social Determinants of Health. The webinar is scheduled for August 17 and will feature speakers including: Brandon G. Wilson, Director of the Center for Consumer Engagement in Health Innovation, Community Catalyst; Gladys Antelo-Allen, Associate Director of Education and Training, Camden Coalition; and Brian Thompson, Housing Coordinator, Care Management Initiatives, Camden Coalition. Registration for the webinar can be found here.
On July 26, HHS, through the Health Resources & Services Administration (HRSA), awarded nearly $11 million to 15 awardees to strengthen the health workforce by establishing new medical residency programs in rural communities. Award recipients will each receive up to $750,000 to establish new rural residency programs and may use the funding to support accreditation costs, curriculum development, faculty recruitment and retention, resident recruitment activities, and consultation services to support program development.
On July 26, HHS Secretary Xavier Becerra released a statement on the 33rd Anniversary of the Americans with Disabilities Act (ADA). Secretary Becerra stated that the administration will continue to call for action to expand access to home and community-based services and accessible transportation and improve employment opportunities.
On July 27, CMS issued the FY 2024 Inpatient Psychiatric Facilities (IPF) Prospective Payment System (PPS) final rule. CMS estimates that IPFs will see a 2.3% increase ($70 million) in total payments relative to FY 2023. The final rule also finalizes CMS’ proposals to rebase and revise the IPF market basket and to modify regulations to allow hospitals to open and begin billing Medicare for an excluded IPF unit anytime within the cost reporting year. A fact sheet on the final rule can be found here.
On July 27, CMS issued the FY 2024 Inpatient Rehabilitation Facility (IRF) Prospective Payment System (PPS) and Updates to the IRF Quality Reporting Program (QRP) final rule. The final rule provides for an increase to IRF PPS payment rates of 3.4% ($355 million) for FY 2024. The final rule also adopts several proposed changes to the IRF QRP, including proposals to modify, remove, and add a number of measures for implementation in FY 2025 and FY 2026. A fact sheet on the final rule can be found here.
On July 27, the Food & Drug Administration (FDA) announced new steps to help facilitate innovation in devices intended to treat opioid use disorder (OUD). The draft guidance, Clinical Considerations for Studies of Devices Intended to Treat Opioid Use Disorder, outlines key considerations intended to aid sponsors in designing clinical studies for devices intended to treat OUD that address challenges, including inaccurate participant reports of drug use, high rates of missing data, the confounding effects of concomitant drug treatments and the need to demonstrate the durability of the treatment effect of the device
On July 27, Surescripts and the Federal Trade Commission (FTC) agreed on a proposed settlement that resolves FTC charges that the company used anti-competitive tactics to illegally monopolize two e-prescription drug markets. The settlement prevents Surescripts from engaging in exclusionary conduct and executing or enforcing non-compete agreements with current and former employees.
On July 27, FDA announced new fiscal 2024 user fee rates for biosimilars, generic drugs, medical devices, prescription drugs, and outsourcing facilities in the Federal Register.
On July 28, CMS issued the FY 2024 Hospice Wage Index and Payment Rate Update final rule. The FY 2024 hospice payment update percentage is 3.1% (an estimated increase of $780 million in payments from FY 2023). The hospice payment update includes a statutory aggregate cap limiting the overall payments per patient made to a hospice annually. The hospice cap amount for FY 2024 is $33,494.01, which is equal to the FY 2023 cap amount ($32,486.92), updated by the FY 2024 hospice payment update percentage of 3.1%. The rule also finalizes the proposal that physicians who certify patient eligibility for hospice services must be enrolled in Medicare or validly opted out as a prerequisite for payment for the hospice period of care in question. A fact sheet on the final rule can be found here.
WHITE HOUSE
On July 24, the White House stated that President Biden would veto H.R. 4366 — Military Construction and Veterans Affairs, and Related Agencies Appropriations Act, if it were to reach his desk, pointing to the legislation’s funding cuts and policy riders targeting abortion, gender-affirming care, contraception, and tobacco regulation.
On July 24, Mexico President Andrés Manuel López Obrador and senior officials hosted a U.S. delegation led by Homeland Security Advisor Dr. Elizabeth Sherwood-Randall to further the cooperation that the countries already have undertaken, including on the global fight against illicit fentanyl and dual-use chemical substances. The leaders discussed their commitment to continuing joint efforts under the U.S.-Mexico Bicentennial Framework for Security, Public Health, and Safe Communities to combat drug traffickers, disrupt the supply of the chemicals used to make illicit fentanyl, prevent trafficking.
On July 27, President Joe Biden announced the first cancer-focused initiative under the Advanced Research Projects Agency for Health (ARPA-H). The Precision Surgical Interventions program will directly fund cancer treatment innovation, focused on new techniques and technologies in excising cancerous cells and surgically removing tumors more precisely and accurately.
RULES AT THE WHITE HOUSE OFFICE OF MANAGEMENT & BUDGET (OMB)
Pending Review
CMS
Medicare Secondary Payer and Certain Civil Money Penalties (CMS-6061); Final Rule; 3/1/22
Minimum Staffing Standards for Long-Term Care Facilities (CMS-3442); Proposed Rule; 5/30/23
Streamlining the Medicaid, CHIP, and BHP Application, Eligibility Determination, Enrollment, and Renewal Processes (CMS-2421); Final Rule; 6/28/23
FDA
Informed Consent: Guidance for Institutional Review Boards, Clinical Investigators, and Sponsors; Notice; 5/19/23
Direct-to-Consumer Prescription Drug Advertisements: Presentation of the Major Statement in a Clear, Conspicuous, Neutral Manner in Advertisements in Television and Radio Format; Final Rule; 5/19/23
Postmarketing Approaches to Obtain Data on Under-Represented Populations in Clinical Trials (Draft Guidance); Notice; 6/29/23
Communications from Firms to Health Care Providers Regarding Scientific Information on Unapproved Uses of Certain Legally Marketed Medical Products: Questions and Answers (CDER, 2023-155); Notice; 7/13/23
Medical Devices; Laboratory Developed Tests; Proposed Rule; 7/26/23
REPORTS
Office of Inspector General (OIG)
On July 24, OIG released a report examining capitation payments to Medicaid Managed Care Organizations (MCOs) in Virginia after enrollees' deaths. OIG selected and reviewed a stratified random sample of 100 capitation payments (out of 58,351) totaling $319,525. For 67 of the 100 capitation payments, OIG found that Virginia made unallowable capitation payments totaling $76,939. For 30 of the remaining capitation payments, Virginia adjusted the capitation payments before the audit. OIG estimates that Virginia made unallowable capitation payments totaling at least $21.8 million to MCOs on behalf of 12,054 deceased enrollees during the audit period. OIG recommends that Virginia: 1) refund $15.7 million to the Federal Government; 2) identify and recover unallowable capitation payments, which we estimate to be at least $21.8 million, made to MCOs during the audit period on behalf of deceased enrollees; and 3) identify and recover unallowable capitation payments made on behalf of deceased enrollees in 2018 and 2022 and repay the Federal share of amounts recovered.
OTHER POLICY NEWS
On July 24, a lawsuit began in Alabama examining whether hospitals can use state courts to hold drugmakers and distributors accountable for the opioid crisis. A group of eight Alabama hospitals argue that they have been on the front lines of treating victims of the opioid crisis and have borne a significant portion of the associated costs. The hospitals are seeking between $300 million and $500 million from the nine defendants, which include opioid manufacturer Johnson & Johnson and wholesale distributor AmerisourceBergen.