Health Care Watch: July 11, 2021
The following Health Care Watch provides a summary of legislative and regulatory health care activities from July 5 - July 10. 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.
NON-CORONAVIRUS LEGISLATIVE UPDATE
House
On June 28, the Appropriations Committee released 302(b) appropriation discretionary spending amounts for fiscal year (FY) 2022. Proposed topline funding includes $26.6 billion for the Agriculture-Food and Drug Administration (FDA) Subcommittee and $237.5 billion for the Labor-Health & Human Services (HHS)-Education Subcommittee. On June 30, the Appropriations Committee approved the FY 2022 Agriculture, Rural Development, FDA, and Related Agencies bill by voice vote. A summary of the spending bill is available here.
On July 8, Oversight & Reform Committee Chair Carolyn Maloney (D-NY), Speaker Nancy Pelosi (D-CA), and other Oversight & Reform Committee Members released a staff report on financial data for 14 drug companies to evaluate the amount they spend “to enrich investors and executives,” compared to research and development (R&D) investments, and the potential impact of allowing Medicare to negotiate drug prices. The investigation found that the 14 drug companies the committee focused on spent $577 billion on stock buybacks and dividends, compared to the $521 billion they spent on R&D, from 2016 to 2020. The report also argued that many drug companies spent a significant portion of their R&D budget on suppressing generic and biosimilar competition, rather than on innovative research, while continuing to raise prices.
On July 6, Ways & Means Health Subcommittee Chairman Lloyd Doggett (D-TX) and 76 other Democrats introduced the Medicare Dental, Vision, and Hearing Benefit Act,which would expand Medicare coverage to these benefits through Medicare Part B. A summary of the bill is available here.
On July 6, the Appropriations Agriculture, Rural Development, FDA, and Related Agencies Subcommittees held a hearing entitled FY 2021 Agriculture, Rural Development, FDA, and Related Agencies Subcommittee Markup. A summary of the FY 2021 Agriculture Subcommittee Bill is available here. Chairman Sanford Bishop (D-GA) highlighted the increase in funding for rural broadband and other rural infrastructure.
Senate
On July 9, Majority Leader Chuck Schumer (D-NY) released a Dear Colleague outlining the Senate schedule for July, noting that the Senate will consider both the bipartisan infrastructure legislation and a budget resolution with reconciliation instructions.
On July 8, Sen. Chuck Grassley (R-IA) urged Office of National Drug Control Policy Acting Director Regina LaBelle to permanently schedule fentanyl related substances; include a comprehensive approach on how to address prevention, interdiction, and enforcement efforts surrounding methamphetamine; address polysubstance drug abuse to ensure that the overall drug abuse and overdose crisis is holistically addressed, including efforts on prevention, enforcement, and treatment; address the benefits and dangers of marijuana, and how it plans to implement prevention programs for youth users; addresses how digital currency technologies is funding illicit activities and work with other government entities such as the Department of the Treasury, the Department of Justice/Drug Enforcement Administration, and the Federal Bureau of Investigation to strengthen the US financial systems to prevent DTOs and MLOs from taking advantage of banking loopholes; balance deterrence and punishment with rehabilitation and fairness; repair joint drug interdiction efforts with Mexico and secure the Southwest border and prevent the illegal trafficking of drugs; and include enforcement, prevention, treatment, and recovery efforts post-COVID.
NON-CORONAVIRUS REGULATORY UPDATE
On July 6, Dr. Meena Seshamani was appointed as CMS Deputy Administrator and Director for the Center for Medicare. Jacqueline Corrigan-Curay was appointed FDA Principal Deputy Center Director of the Center for Drug Evaluation and Research. M. Khair ElZarrad will take over Corrigan-Curay’s position as FDA Office of Medical Policy Acting Director.
On July 6, FDA published guidance on how device manufacturers should comply with unique device identifier labeling requirements.
On July 6, FDA Director Janet Woodcock on Tuesday published a blog post on how FDA plans to spend additional funds it requested from Congress on IT investments and enterprise modernization.
On July 6, the White House Office of Management & Budget (OMB) received a final rule from CMS entitled FY 2022 Inpatient Rehabilitation Facility (IRF) Prospective Payment System Rate Update and Quality Reporting Requirements (CMS-1748).
On July 6, OMB concluded review of a notice from the HHS Office of the Secretary entitled Extension of Designation of Scarce Materials or Threatened Materials Subject to COVID-19 Hoarding Prevention Measures; Extension of Effective Date with Modifications.
On July 7, OMB received a proposed rule from CMS entitled Most Favored Nation (MFN) Model (CMS-5528). As background, in late December 2020, the U.S. District Court for the Northern District of California issued a nationwide preliminary injunction which preliminarily enjoined CMS from implementing the Trump-era MFN Model Interim Final Rule. At the time, CMS noted that “given this preliminary injunction, the MFN Model was not implemented on January 1, 2021 and will not be implemented without further rulemaking.” It is unclear whether the proposed rule modifies or rescinds the Trump-era MFN Model.
On July 7, OMB received the following final rule from CMS entitled FY 2022 Inpatient Psychiatric Facilities Prospective Payment System Rate and Quality Reporting Updates (CMS-1750).
On July 8, the FDA revised the usage labeling for Biogen’s new Alzheimer’s drug, Aduhelm, noting that it should only be used for patients with mild or early-stage Alzheimer’s. On July 9, Acting FDA Commissioner Woodcock urged the HHS Office of Inspector General (OIG) to review the agency’s interactions with Biogen leading up to the approval of Aduhelm. On July 9, it was reported that on June 30 AHIP formally requested that CMS establish a National Coverage Determination (NCD) for Aduhelm to clarify whether and under what circumstances Medicare will cover the drug.
On July 8, FDA issued a notice entitled Requests for Proposals for Insulin Reimportation and Personal Prescription Drug Importation; Withdrawal. This notice revokes the Trump-era requests for proposals related to insulin reimportation and personal prescription drug importation.
On July 8, OMB received a final rule from CMS entitled FY 2022 Hospice Wage Index, Payment Rate Update, and Quality Reporting Requirements (CMS-1754).
On July 8, CMS issued a correction to the rule entitled Comprehensive Care for Joint Replacement Model Three Year Extension and Changes to Episode Definition and Pricing; Medicare and Medicaid Programs; Policy and Regulatory Revisions in Response to the COVID-19 Public Health Emergency; Additional Policy and Regulatory Revisions in Response to the COVID-19 Public Health Emergency.
On July 9, the U.S. Patent and Trademark Office and Department of Commerce issued a request for information on the current state of patent eligibility and how the current jurisprudence has impacted investment and innovation.
On July 9, the HHS Office of the National Coordinator for Health Information Technology released the U.S. Core Data for Interoperability version 2 standards, to support the electronic exchange of sexual orientation, gender identity, and social determinants of health.
NON-CORONAVIRUS WHITE HOUSE UPDATE
On July 9, President Biden issued an Executive Order (EO) entitled Promoting Competition in the American Economy. The EO aims to promote competition, including 72 initiatives to tackle competition problems across the economy. The initiatives include: directing HHS to develop a comprehensive plan within 45 days to lower drug prices; supporting state and tribal programs to import safe and cheaper drugs from Canada to lower prescription drug prices; allowing hearing aids to be sold over the counter at drug stores; call for the Department of Justice and Federal Trade Commission (FTC) to enforce antitrust laws and allow them to challenge prior bad mergers that past Administrations did not previously challenge, including prescription drugs, hospital consolidation, and insurance; encouraging the FTC to ban “pay for delay” arrangements; establishes a White House Competition Council to monitor progress on finalizing the initiatives and to coordinate the federal government’s response to the rising power of large corporations in the economy; and other initiatives.
CORONAVIRUS UPDATE
House
None of note.
Senate
None of note.
Regulatory
On July 6, the Centers for Disease Control and Prevention (CDC) announced that the COVID-19 delta variant, B.1.1.7, accounts for more than 51% of COVID-19 cases in the U.S.
On July 8, the FDA and CDC issued a joint statement that people who are fully vaccinated are protected from severe COVID-19 disease and death, including the Delta variant, and do not need a booster shot, while people who are not vaccinated remain at risk.
The COVID-19 Health Equity Task Force will hold a virtual meeting on July 30 to consider interim recommendations addressing future pandemic preparedness, mitigation, and resilience needed to ensure equitable response and recovery in communities of color and other underserved populations
HHS’ Office of the Assistant Secretary for Preparedness and Response will hold a meeting with COVID-19 test makers and labs on July 22 to prepare for the next phase of the pandemic and discuss potential strategies to maintain preparedness efforts.
White House
On July 6, White House Press Secretary Jen Psaki announced that the U.S. will send 1.5 million Moderna COVID-19 vaccines to Guatemala and 2 million to Vietnam.
On July 6, President Biden announced that the Administration continues its vaccine campaign, including going “community-by-community, neighborhood-by-neighborhood, and oftentimes, door-to-door” to reach and educate those not yet vaccinated.
On July 6, White House COVID-19 Response Coordinator Jeff Zients said that the U.S. will be prepared to deploy COVID-19 booster shots if determined necessary.
Other
On July 5, a study by the Israel Health Ministry found that the Pfizer COVID-19 vaccine is 64% effective against the Delta variant. The vaccine continues to be 93% effective at preventing hospitalizations and severe symptoms.
On July 6, the World Health Organization recommended the use of Roche’s Actemra, tocilizumab, and Regeneron’s Kevzara, sarilumab, for treating COVID-19.
On July 7, the Commonwealth Fund released a report that estimated that the U.S. COVID-19 vaccination campaign saved an estimated 279,000 lives and averted up to 1.25 million hospitalizations.
On July 9, Pfizer announced that it will ask the FDA to authorize a third dose of its COVID-19 vaccine by next month. Pfizer also suggests a third “booster” dose may be able to improve protection against the COVID-19 Delta variant.
On July 9, a study published in Nature found that in preliminary lab testing, the Delta variant was resistant to some monoclonal antibody drugs, such as bamlamivimab, and natural antibodies from infection or vaccination.
As of July 10, nearly 184 million people in the U.S. have received the first dose of COVID-19 vaccines (nearly 159 million have received both doses) and nearly 387 million doses have been distributed, according to the CDC COVID Data Tracker.
As of July 9, the U.S. had more than 33.8 million confirmed COVID-19 cases resulting in 606,806 deaths, according to the Johns Hopkins University & Medicine Coronavirus Resource Center. On July 7, the global COVID-19 death toll surpassed 4 million.
RULES AT THE WHITE HOUSE OMB
HHS-CMS
Modification of Limitations on Redesignation by the Medicare Geographic Classification Review Board (CMS-1762); Interim Final Rule; Received 2/26/21
CY 2022 Revisions to Payment Policies Under the Physician Fee Schedule and Other Revisions to Medicare Part B (CMS-1751); Proposed Rule; Received 3/30/21
CY 2022 Hospital Outpatient PPS Policy Changes and Payment Rates and Ambulatory Surgical Center Payment System Policy Changes and Payment Rates (CMS-1753); Proposed Rule; Received 5/11/21
Basic Health Program; Federal Funding Methodology for Program Year 2022 (CMS-2438); Final Rule; Received 5/12/21
FY 2022 Inpatient Rehabilitation Facility (IRF) Prospective Payment System Rate Update and Quality Reporting Requirements (CMS-1748); Final Rule; 7/6/21
Reporting Requirements Related To Air Ambulance and Agent and Broker Services and HHS Enforcement Provisions; Proposed Rule; 7/7/21
Most Favored Nation (MFN) Model (CMS-5528); Proposed Rule; 7/7/21
FY 2022 Inpatient Psychiatric Facilities Prospective Payment System Rate and Quality Reporting Updates (CMS-1750)’ Final Rule; 7/7/21
FY 2022 Hospice Wage Index, Payment Rate Update, and Quality Reporting Requirements (CMS-1754); Final Rule; Received 7/8/21
HHS-FDA
Drug Supply Chain Security Act Implementation: Identification of Suspect Product and Notification; Guidance for Industry; Availability; Notice; 5/11/21
Definitions of Suspect Product and Illegitimate Product for Verification Obligations Under the Drug Supply Chain Security Act; Draft Guidance for Industry; Availability; Notice; Received 5/11/21
Product Identifiers Under the Drug Supply Chain Security Act Questions and Answers; Guidance for Industry; Availability; Notice; 5/11/21
Enhanced Drug Distribution Security at the Package Level Under the Drug Supply Chain Security Act; Draft Guidance for Industry; Availability; Notice; 5/11/21
Remanufacturing of Medical Devices; Draft Guidance for Industry and Food and Drug Administration Staff; Prerule; Received 5/26/21
REPORTS
HHS Office of Inspector General (OIG)
On July 7, OIG released an advisory opinion regarding the anti-kickback statute and the use of a preferred hospital network as part of Medicare Supplemental Health Insurance (Medigap) policies.
On July 7, OIG released a report entitled The Puerto Rico Department of Health's (PRDOH) Implementation of Its Emergency Preparedness and Response Activities Before and After Hurricane Maria Was Not Effective. The report found that PRDOH did not effectively implement its emergency preparedness and response activities before and after Hurricane Maria, which as a result, placed the health and safety of its residents at risk. OIG recommended that PRDOH revise its Emergency Operation Plan, consider working with the HHS Office of the Assistant Secretary for Preparedness and Response to develop an effective method for contacting volunteers when there are communication challenges and consider coordinating with appropriate organizations to develop guidance on accurate cause-of-death certifications. PRDOH did not agree or disagree with the recommendations, but it described steps that it has taken to address them. A summary of the report is available here.
On July 8, OIG released an advisory opinion regarding the anti-kickback statute and financial assistance for transportation, lodging, and meals provided by the Requestor to certain patients potentially eligible for treatment with Requestor’s drug.
On July 8, OIG released a report entitled The National Heart, Lung, and Blood Institute (NHLBI) Did Not Fully Comply With Federal Requirements for Other Transactions. The report found that NHLBI did not fully comply with Federal requirements for awarding and administering "other transactions" (OTs), which are special award instruments that are generally not subject to Federal laws and regulations that apply to traditional award instruments, and did not adequately document its justifications for: using OTs rather than traditional award instruments, ensuring that awarded amounts were fair and reasonable and incurred costs were allowable, or ensuring that it complied with Federal requirements for obligating annual appropriations. OIG recommended that NHLBI strengthen its internal controls for OTs by updating its policies and procedures to properly document its justifications for using OTs instead of traditional award instruments and to determine fairness and reasonableness of award amounts, allowability of costs, and compliance with Federal funding requirements. National Institutes of Health agreed with the recommendations. A summary of the report is available here.
On July 9, OIG released a report entitled The CMS Did Not Account for National Security Risks in Its Enterprise Risk Management (ERM) Processes. The report found that CMS' ERM process did not consider national security risks for any of CMS' programs in accordance with Federal requirements and lacked policies and procedures that required its programs to consider national security threats because it relied on HHS' ERM process. OIG recommended that CMS implement a process to assess all of its programs for national security risks to include new or emerging risks in the risk profile. CMS agreed with the recommendation. A summary of the report is available here.
On July 9, OIG released a report entitled Medicare Payments for Transitional Care Management (TCM) Services Generally Complied With Federal Requirements, but Some Overpayments Were Made. The report found that payments made to physicians for TCM services generally complied with Federal requirements, but there were $1.7 million in overpayments where multiple physicians billed for TCM services for a beneficiary's same 30-day TCM service period and billed overlapping care management services. OIG recommended that CMS notify appropriate providers so that they can exercise reasonable diligence to identify, report, and return any overpayments and implement claims processing controls to prevent and detect overpayments for TCM services. CMS agreed with the recommendations and described corrective actions that it had taken or planned to take. A summary of the report is available here.
On July 9, OIG released a report entitled New York's Claims for Federal Reimbursement for Payments to Health Home Providers on Behalf of Beneficiaries Diagnosed With Serious Mental Illness or Substance Use Disorder Generally Met Medicaid Requirements But It Still Made $6 Million in Improper Payments to Some Providers.The report found that New York improperly claimed reimbursement for some payments, specifically New York's health home providers, did not provide a comprehensive patient-centered care plan covering the sampled date of service for enrolled beneficiaries and did not document health home services. OIG recommended that New York refund $6 million in overpayments and strengthen its monitoring of the health home program to ensure that health home providers comply with Federal and State requirements for providing services according to a comprehensive patient-centered care plan and maintaining documentation to support services billed. The agency did not agree or disagree with the recommendations, but it described actions to address them. A summary of the report is available here.
On July 9, OIG released an update entitled LEIE Database Updated with June 2021 Exclusions and Reinstatements.
Congressional Budget Office (CBO)
On July 6, CBO released a report entitled HISIM2: The Health Insurance Simulation Model Used in Preparing CBO’s July 2021 Baseline Budget Projections. CBO updated the model CBO uses to generate estimates of health insurance coverage and premiums for people under age 65 to take into consideration the impacts of COVID-19 and other updates. A summary of the update is available here.
On July 9, CBO released a report entitled Monthly Budget Review: June 2021. The report found that the deficit was $2.2 trillion in the first nine months of FY 2021, $508 billion less than the deficit recorded during the same period last year, in part because some tax payments were due earlier this year. A summary of the report is available here.
UPCOMING CONGRESSIONAL HEARINGS
House
Appropriations Labor, HHS, Education, and Related Agencies Subcommittee
FY Appropriations 2022 Markup: Labor, HHS, Education, and Related Agencies
Monday, July 12, 11:00 a.m.
Energy & Commerce Member Day Hearing
Tuesday, July 13, 11:00 a.m.
Appropriations Committee
FY Appropriations 2022 Markup
July 16-17, TBD
Senate
Senate Health, Education, Labor and Pensions Committee
July 13, 10:00 a.m.
Senate Judiciary Competition Policy, Antitrust, and Consumer Rights Subcommittee
A Prescription for Change: Cracking Down on Anticompetitive Conduct in Prescription Drug Markets
July 13, 2:30 p.m., Dirksen Senate Office Building Room 226
OTHER HEALTH POLICY NEWS
The Committee for a Responsible Federal Budget has estimated that lowering the Medicare eligibility age to 60 would cost $200 billion over one decade. Expanding Medicare coverage of dental, vision and hearing coverage could cost $358 billion over the next 10 years
On July 6, a study published in JAMA Internal Network found Costco’s streamlined distribution system for generic drugs could have saved Medicare $2.6 billion on 184 commonly prescribed generic drugs. Medicare overspent by 13.2% in 2017 and 20.6% in 2018 compared with Costco member prices for these prescriptions
On July 6, the Wall Street Journal analyzed hospital pricing data and found that hundreds of hospitals charge higher prices for uninsured patients than those with insurance.
On July 7, Moderna began its Phase I/II study of its quadrivalent seasonal influenza mRNA vaccine candidate. Moderna aims to develop a vaccine combining seasonal flu, COVID-19 variant booster, and respiratory syncytial virus.