Health Care Watch: May 6, 2024
The following Federal Health Policy (FHP) Strategies Weekly Health Care Watch provides a summary of legislative and regulatory health care activities from April 29 – May 5. 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 May 1, the Energy & Commerce Oversight and Investigations Subcommittee held ahearing entitled Examining the Change Healthcare Cyberattack. UnitedHealth Group CEO Andrew Witty testified on behalf of the company, answering a variety of questions regarding Change and United’s cybersecurity protocols, the aftermath of the cyberattack, and actions to prevent future cyberattacks. Mr. Witty’s testimony can be found here.
Senate
On May 1, the Finance Committee held a hearing entitled Hacking America’s Health Care: Assessing the Change Healthcare Cyber Attack and What’s Next. UnitedHealth Group CEO Andrew Witty also testified in front of the Finance Committee. His testimony can be foundhere.
On May 2, Appropriations Committee Chair Patty Murray (D-WA) and Sens. Lisa Murkowski (R-AK), Tammy Baldwin (D-WI), Susan Collins (R-ME), Amy Klobuchar (D-MN) and Shelley Moore Capito (R-WV) introduced the Advancing Menopause and Mid-Life Women’s Health Act. The legislation would provide $275 million over five years to strengthen and expand federal research on menopause, health care workforce training, awareness and education efforts, and public health promotion and prevention to better address menopause and mid-life women’s health issues.
On May 3, Finance Committee Chairman Ron Wyden (D-OR) and Ranking Member Mike Crapo (R-ID) released a discussion draft that would establish a new program in Medicare for hospitals and physicians to incentivize transparent, reliable, and resilient purchasing practices across supply-chain participants, including by driving health care providers, intermediaries and drug manufacturers to meet proactive standards in securing a sustainable, high-quality supply of essential medicines. Key requirements for program participants, in order to receive targeted Medicare incentive payments, include: minimum three-year contracts with manufacturers for generic drugs that present high shortage risks; meaningful purchase volume commitments and stable pricing; requirements for contingency contracts with alternate manufacturers; and transparency around manufacturer quality control issues to improve supply-chain visibility.
REGULATORY UPDATE
On April 29, the Food & Drug Administration (FDA) announced a final rule that amends FDA’s regulations to make explicit that in vitro diagnostic products (IVDs) are devices under the Federal Food, Drug, and Cosmetic Act (FD&C Act) including when the manufacturer of the IVD is a laboratory. FDA also issued a policy to phase out, over the course of four years, its general enforcement discretion approach for laboratory developed tests (LDTs). The agency also issued targeted enforcement discretion policies for certain categories of IVDs manufactured by laboratories. A fact sheet detailing the final rule can be found here.
On April 29, FDA announced that it will host a listening session on June 13 as part of its broader work to optimize the use of, and processes for, advisory committees. This virtual public meeting will focus on the composition of advisory committees, ways to improve the experience for members serving on committees and ways to ensure public awareness and understanding of the role of FDA advisory committees. Registration for the listening session can be found here.
On April 29, the Health Resources and Services Administration (HRSA) announced $105 million in funding to support more than 100 community-based organizations working to improve maternal and infant health. Healthy Start is a HRSA-funded program that focuses on improving the well-being of expecting mothers and those who have just given birth. TheHealthy Start funding announcement will support the health care and social needs of moms and babies in high need communities to help improve community health and combat disparities in maternal and infant health outcomes.
On April 29, the U.S. Department of Health & Human Services (HHS) released its plan for promoting responsible use of artificial intelligence (AI) in automated and algorithmic systems by state, local, tribal, and territorial governments in the administration of public benefit. HHS stated that it is committed to strengthening governance, advancing responsible innovation, and managing risks in the use of AI-enabled automated or algorithmic systems. The plan provides more detail about how the rights-impacting and/or safety-impacting risk framework established in OMB Memorandum M-24-10 applies to public benefits delivery, provides information about existing guidance that applies to AI-enabled systems, and lays out topics that HHS is considering providing future guidance on.
On April 29, the Department of Labor (DOL) released a final rule that rescinds a 2018 rule that established an alternative set of criteria from those set forth in guidance issued prior to the 2018 rule for determining when a group or association of employers is acting “indirectly in the interest of an employer” for purposes of establishing an association health plan (AHP) as a multiple employer group health plan. DOL believes that the core provisions of the 2018 rule are, at a minimum, not consistent with the “best reading” of statutory requirements governing group health plans. DOL notes that it does not believe any entities rely upon the 2018 rule, so the rescission will maintain the status quo. The new rule will be effective on June 29, 2024.
On April 30, HHS’ Office for Civil Rights (OCR) and the Assistant Secretary for Financial Resources, released the Health and Human Services Grants Regulation (HHS Grants Rule) Final Rule. The final rule aims to affirm nondiscrimination in HHS-funded programs and services to protect LGBTQI+ people by clarifying and reaffirming the prohibition on discrimination on the basis of sex. The final rule confirms these protections in specific HHS programs, including services and grants that provide aid to refugees, early childhood education services, assistance to people experiencing homelessness, substance use disorder (SUD) treatment and prevention, community mental health services, maternal and child health services, and community services.
On May 1, HHS’ OCR released a final rule entitled Discrimination on the Basis of Disability in Health and Human Service Programs or Activities. The final rule aims to advance equity and bolsters protections for people with disabilities under Section 504 of the Rehabilitation Act (Section 504). The Section 504 Final Rule clarifies and strengthens civil rights protections for people with disabilities, addresses discrimination in medical treatment, adds enforceable standards for accessible medical diagnostic equipment, and ensures accessible web content and mobile apps. Additionally, the final rule updates existing requirements to make them consistent with the American with Disabilities Act. A fact sheet detailing the final rule can be found here.
On May 2, the Substance Abuse and Mental Health Services Administration announced the 2024 State Opioid Response (SOR) and Tribal Opioid Response (TOR) Notices of Funding Opportunity, providing up to $1.48 billion to states, territories, and the District of Columbia and $63 million to Tribes to address the overdose crisis in fiscal year 2024. The 2024 SOR funding opportunity includes initiatives to: build on opioid overdose reversal medication (naloxone and nalmefene) saturation efforts; increase the focus on the full continuum of prevention, harm reduction, treatment, and recovery support services; and emphasize the provision of services using a whole-person approach.
On May 3, CMS released draft guidance for public comment on the second cycle of negotiations under the Medicare Drug Price Negotiation Program. CMS will announce up to 15 additional drugs selected for potential negotiation for 2027 by February 1, 2025. This second round of negotiations will occur during 2025, and any negotiated maximum fair prices (MFPs) will be effective for this second set of drugs starting January 1, 2027. Additionally, CMS is setting forth policies that outline how manufacturers must ensure eligible people in Medicare will have access to the negotiated MFPs for 2026 and 2027. CMS will engage with a Medicare Transaction Facilitator (MTF), which will serve as the infrastructure intended to facilitate the exchange of data between pharmaceutical supply chain entities to verify eligibility of an individual who is dispensed a selected drug for its negotiated MFP. A fact sheet detailing the guidance can be found here.
On May 3, CMS released a final rule that removes the prohibition on Deferred Action for Childhood Arrivals (DACA) recipients’ eligibility for Affordable Care Act coverage. The final rule is projected to help more than 100,000 young people gain health insurance. Starting in November, DACA recipients can apply for coverage through HealthCare.gov and state-based marketplaces, where they may qualify for financial assistance. A fact sheet detailing the final rule 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
Misclassification of Drugs, Program Administration and Program Integrity Updates Under the Medicaid Drug Rebate Program (CMS-2434); Final Rule; 3/22/24
CY 2025 Changes to the End-Stage Renal Disease (ESRD) Prospective Payment System and Quality Incentive Program (CMS-1805); Proposed Rule; 4/18/24
CY 2025 Revisions to Payment Policies Under the Physician Fee Schedule and Other Revisions to Medicare Part B (CMS-1807); Proposed Rule; 4/18/24
CY 2025 Hospital Outpatient PPS Policy Changes and Payment Rates and Ambulatory Surgical Center Payment System Policy Changes and Payment Rates (CMS-1809); Proposed Rule; 4/24/24
CY 2025 Home Health Prospective Payment System Rate Update and Home Infusion Therapy and Home IVIG Services Payment Update (CMS-1803); Proposed Rule; 4/26/24
FDA
Diversity Action Plans to Improve Enrollment of Participants from Underrepresented Populations in Clinical Studies; Guidance for Industry; Notice; 4/10/24
ONC
Health Data, Technology, and Interoperability: Patient Engagement, Information Sharing, and Public Health Interoperability; Proposed Rule; 1/18/24
REPORTS
Government Accountability Office (GAO)
On May 2, GAO released a report examining challenges faced by the strategic national stockpile (SNS). GAO found that the 62 jurisdictions GAO surveyed reported challenges during the COVID-19 and mpox responses related to understanding the SNS inventory and coordinating on requesting and receiving SNS assets. GAO stated that these challenges led to jurisdictional confusion during response efforts, and while HHS has taken some actions, challenges still exist regarding the lack of 1) clearly defined roles for HHS agencies that work with SNS assets; and 2) procedures for updating SNS's main guidance document. GAO recommends that HHS: 1) define and share SNS roles; 2) develop procedures for updating guidance; and 3) assess unique tribal issues. HHS concurred with all recommendations.
House
Small Business Committee
May 8; 10:00 AM; 2360 Rayburn
Stifling Innovation: Examining the Impacts of Regulatory Burdens on Small Businesses in Healthcare
Ways and Means Committee
Likely the week of March 6
Markup of Medicare extenders, rural health policy, and telehealth legislation
Senate
Appropriations Committee
May 8; 10:00 AM; 124 Dirksen
A Review of the President’s Fiscal Year 2025 Budget Request for the Food and Drug Administration
Witness: Dr. Robert Califf, Commissioner, FDA
Budget Committee
May 8; 10:00 AM; SD-608
Reducing Paperwork, Cutting Costs: Alleviating Administrative Burdens in Health Care
Witnesses: Dr. David Cutler, Otto Eckstein Professor of Applied Economics, Harvard University; Mr. Noah Benedict; President & CEO; Rhode Island Primary Care Physicians Corporation