Health Care Watch: July 29, 2024
The following Federal Health Policy (FHP) Strategies Weekly Health Care Watch provides a summary of legislative and regulatory health care activities from July 21 – July 28 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 23, the Oversight and Accountability Committee held a hearing entitled the Role of Pharmacy Benefit Managers (PBMs) in Prescription Drug Markets Part III: Transparency and Accountability. CEOs from CVS Caremark, Express Scripts, and OptumRx testified before the committee regarding their business and transparency practices. Members discussed reports of anti-competitive behavior through patient steering and spread pricing and referenced a recent Federal Trade Commission (FTC) report that found that the top three PBMs processed nearly 80% of all prescriptions filled in the U.S. in 2023.
On July 25, Energy & Commerce Committee Chair Cathy McMorris Rodgers (R-WA), Health Subcommittee Chairman Brett Guthrie (R-KY), and Oversight & Investigations Subcommittee Chairman Morgan Griffith (R-VA) sent a letter to Department of Health & Human Services (HHS) Secretary Xavier Becerra and National Institutes of Health (NIH) Director Monica Bertagnolli requesting documents and transcribed interviews related to an approved MPVX experiment. The letter comes after the Committee released an interim staff report on the experiment as well as an NIH reform framework. The letter notes that a failure to produce the requested documents by August 8, 2024, may lead to issuance of a subpoena to compel compliance.
The House is in recess until September 9.
Senate
On July 23, Health, Education, Labor & Pensions (HELP) Committee Ranking Member Bill Cassidy (R-LA) introduced the Upholding Standards of Accountability (USA) Act. This legislation comes as the Supreme Courtrecently overturned its previous 1984 Chevron decision and aims to rein in the executive branch and ensure federal agencies are held accountable to Congress. Specifically, the USA Act would: require the head of a federal agency signing a major rule to testify about the rule before the committee of jurisdiction within 30 days of the rule being published; require each person nominated to a Senate-confirmed position to testify before the committee of jurisdiction prior to Senate confirmation; and improve cost-benefit analyses by requiring federal agencies to conduct retrospective reviews of such analyses for major rulemakings within five years of each rule’s effective date.
On July 23, Majority Whip Dick Durbin (D-IL) and House Appropriations Committee Ranking Member Rosa DeLauro (D-CT) introduced the Federal Food Administration Act. The legislation would separate the Food & Drug Administration’s (FDA) food and drug regulatory powers by establishing the Federal Food Administration, a single agency responsible for ensuring the safety of the nation’s food supply and promoting good nutrition.
On July 24, the Senate passed the Preventing the Financing of Illegal Synthetic Drugs Act. The legislation will direct the Government Accountability Office (GAO) to investigate how transnational criminal organizations finance synthetic drug trafficking and help the federal government target them more effectively. The legislation now heads to the President’s desk for his signature.
On July 25, the HELP Committee voted to open an investigation into Steward Health Care – a large, for-profit health care system that operates several hospitals in Massachusetts and filed for Chapter 11 bankruptcy in May. The Committee also voted to subpoena the CEO of Steward Health, Ralph de la Torre. He is ordered to testify before the Committee on September 12, 2024.
REGULATORY UPDATE
On July 22, the Biden-Harris Administration’s Kids Online Health and Safety Task Force, co-led by HHS’ Substance Abuse and Mental Health Services Administration (SAMHSA) and the Department of Commerce’s (DOC) National Telecommunications and Information Administration (NTIA), released a new report with recommendations and best practices for safer social media and online platform use for youth. The recommendations in the report, Online Health and Safety for Children and Youth: Best Practices for Families and Guidance for Industry, underscore efforts to address the ongoing youth mental health crisis.
On July 22, FDA approved Femlyv (norethindrone acetate and ethinyl estradiol), the first orally disintegrating tablet approved for the prevention of pregnancy.
On July 22, FDA published common questions received related to laboratory developed tests (LDTs) and stated that the Agency intends to respond to generally applicable questions, as appropriate, in a public manner.
On July 23, the Centers for Disease Control and Prevention (CDC) issued a Health Alert Network (HAN) Health Advisory to inform healthcare providers, laboratory professionals, healthcare facility administrators, and state, tribal, local, and territorial health departments of a critical shortage of Becton Dickinson (BD) BACTEC blood culture media bottles.
On July 24, CMS released information on the process for drug manufacturers to submit Medicare drug inflation rebate reduction requests related to a severe supply chain disruption or likely shortage. Instructions on how to submit a request can be found here.
On July 24, Treasury Secretary Janet Yellen announced that the United States has pledged $667 million to the World Bank’s Pandemic Fund.
On July 24, SAMHSA announced grant awards totaling $45.1 million to expand mental health and substance use services, including $15.3 million to fund services specifically for children and youth.
On July 25, HHS announced a reorganization of the Department that aims to streamline and bolster technology, cybersecurity, data, and artificial intelligence (AI) strategy and policy functions. Historically, responsibility for policy and operations has been distributed across the Office of the National Coordinator for Health Information Technology (ONC), the Assistant Secretary for Administration (ASA), and the Administration for Strategic Preparedness and Response (ASPR). This reorganization will clarify and consolidate these critical functions, as follows:
ONC will be renamed the Assistant Secretary for Technology Policy and Office of the National Coordinator for Health Information Technology (ASTP/ONC);
Oversight over technology, data, and AI policy and strategy will move from ASA to ASTP/ONC, including the HHS-wide roles of Chief Technology Officer, Chief Data Officer, and Chief AI Officer; and
The public-private effort between the health sector and the federal government on cybersecurity (“405(d) Program”) will move from ASA to ASPR.
Additionally, ASTP/ONC will establish an Office of the Chief Technology Officer and reinstitute the role of Chief Technology Officer, which will oversee department-level and cross-agency technology, data, and AI strategy and policy, including the Office of the Chief AI Officer, Office of the Chief Data Officer, and a new Office of Digital Services.
On July 26, HHS Secretary Xavier Becerra released a statement on the 34th Anniversary of the Americans with Disabilities Act (ADA). Secretary Becerra stated that he is proud of the progress the Administration has made in addressing the health disparities of people with disabilities and that the Administration will continue its work to accelerate progress on the inclusion and equal opportunity for all Americans with disabilities.
WHITE HOUSE
On July 22, President Joe Biden announced that he would no longer accept the Democrat party’s nomination for President. He endorsed Vice President Kamala Harris for the nomination.
On July 22, the Biden Administration stated that it would veto H.R. 9027 – the Agriculture, Rural Development, Food and Drug Administration, and Related Agencies Appropriations Act, 2025 in its current form. The White House Office of Management and Budget (OMB) stated that the Administration is concerned with the legislation’s provisions that place limits on FDA’s ability to regulate tobacco products as well as the legislation’s funding levels for the agency.
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
Administrative Simplification: Modifications to NCPDP Retail Pharmacy Standards (CMS-0056); Final Rule; 6/27/24
Hospital Inpatient Prospective Payment Systems for Acute Care Hospitals; the Long-Term Care Hospital Prospective Payment System; and FY 2025 Rates (CMS-1808); Final Rule; 6/28/24
FY 2025 Skilled Nursing Facility (SNFs) Prospective Payment System and Consolidated Billing and Updates to the Value-Based Purchasing and Quality Reporting Programs (CMS-1802); Final Rule; 6/28/24
FY 2025 Hospice Wage Index, Payment Rate Update, and Quality Reporting Requirements (CMS-1810); Final Rule; 7/8/24
HHS Notice of Benefit and Payment Parameters for 2026 (CMS-9888); Proposed Rule; 7/17/24
FDA
Expedited Program for Serious Conditions--Accelerated Approval of Drugs and Biologics; Draft Guidance for Industry; Availability; Notice; 7/9/24
Conducting Clinical Trials With Decentralized Elements; Guidance for Industry, Investigators, and Other Stakeholders; Availability (2023-814); Notice; 7/25/24
Integrating Randomized Controlled Trials for Drug and Biological Products Into Routine Clinical Practice; Draft Guidance for Industry; Availability; Notice; 7/25/24
REPORTS
Office of Inspector General (OIG)
On July 22, OIG released a report examining HHS’ Office of the Secretary’s (OS) security controls to protect certain cloud information systems. OIG found that HHS OS did not accurately identify and inventory all its cloud systems in accordance with HHS security requirements. Additionally, although HHS OS implemented some security controls to protect its cloud systems, several key security controls were not effectively implemented in accordance with Federal requirements and guidelines. OIG made a series of recommendations for HHS OS to improve key security controls over cloud information systems, including that it implement a strategy that includes leveraging cloud security assessment tools that identify misconfigurations and other control weaknesses in its cloud services, and develop and implement a policy and process to ensure qualified staff are assigned as System Security Officers for its cloud systems.
Government Accountability Office (GAO)
On July 23, GAO released a report examining National Institute on Aging (NIA) project management practices. GAO found that the Real-World Data Platform’s goal was to improve research into Alzheimer's disease and related dementias by compiling and analyzing real-world data, however, during GAO’s work in April 2024, NIA decided not to fund the data platform. Prior to NIA’s decision not to fund the platform, the institute had not fully implemented key leading practices for the Real-World Data Platform's cost estimate or project management. Because NIA made the decision not to fund the Real-World Data Platform, GAO is making no recommendations. However, GAO stated that its analyses demonstrate the importance of developing reliable cost estimates and implementing effective project management practices.
UPCOMING HEARINGS
Senate
HELP Committee
July 31; 10:00 AM; 562 Dirksen
Legislation to be considered: S. 4776, Older Americans Act Reauthorization Act, S. 4762, Autism CARES Act, and S. 4755, Traumatic Brain Injury Program Reauthorization Act
September 12; TBD
Testimony from Steward Health CEO Ralph De La Torre
September 24; 10:00 AM; SD-562
Appropriations Committee
August 1; 9:30 AM; 106 Dirksen
Full Committee Markup of Energy and Water Development; Defense; Labor, Health, & Human Services; Homeland Security; and Financial Services and General Government Appropriations Acts
OTHER NEWS
On July 24, the U.S. Circuit Court of Appeals for the Ninth Circuit found that the seven states — Idaho, Iowa, Montana, Nebraska, South Carolina, Texas and Utah — do not have legal standing to challenge FDA decisions to make the abortion drug mifepristone more available, including through telehealth prescribing and dispensing by mail. The Ninth Circuit panel did not address the states claims that the FDA’s relaxed prescribing conditions harmed patients.