Health Care Watch: August 19, 2024
The following Federal Health Policy (FHP) Strategies Weekly Health Care Watch provides a summary of legislative and regulatory health care activities from August 12 – August 17. 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
The House returns from its August recess on September 9.
Senate
On August 13, Health, Education, Labor & Pensions (HELP) Committee Chairman Bernie Sanders (I-VT) released a statement calling on Prasco Laboratories and GlaxoSmithKline to immediately cap the cost of the authorized generic of Flovent – the most commonly prescribed inhaler for children – at $35, following the implementation of a $35 cap on inhalers by Boehringer Ingelheim and AstraZeneca.
On August 15, Finance Committee Chairman Ron Wyden (D-OR) and Sen. Chuck Grassley (R-IA) raised concerns regarding a potentially unethical hire at the United Network for Organ Sharing (UNOS). In April, UNOS announced the appointment of Ankit Mathur as its Chief Technology Officer. Mathur previously worked at the U.S. Digital Service, where he was responsible for overseeing and evaluating UNOS’ failed technology used to track the national organ transplant waitlist. Chairman Wyden and Sen. Grassley stated that they will continue digging into UNOS’ and Mathur’s actions and the obstacles they may present to ensuring full and open competition for critical contracts in the organ donation system.
The Senate returns from its August recess on September 9.
REGULATORY UPDATE
On August 12, Department of Health & Human Services (HHS) Secretary Xavier Becerra sent a letter to health insurance company CEOs regarding the Biden Administration’s Time is Money Initiative. The letter states that many Americans have faced frustrating and time-consuming experiences with health coverage that make it harder to access care. The letter asks organizations to partner with the Administration and evaluate their operations and protocols and consider what steps can be taken to help improve Americans’ experience with health coverage options. Specifically, the letter asks that companies consider: streamlining processes and providing clear, digestible information about health coverage; improving individuals’ ability to submit claims; and denying claims only when appropriate.
On August 12, the Food & Drug Administration (FDA) announced that it will hold a public meeting on October 16, 2024, titled, “Advancing Rare Disease Therapies Through an FDA Rare Disease Innovation Hub.” The meeting will discuss the establishment of the Rare Disease Innovation Hub which will enhance collaboration and cooperation across FDA’s Center for Biologics Evaluation and Research and Center for Drug Evaluation and Research, as well as other centers and offices across the FDA. Additional information about the meeting, including topics for discussion and how to register, can be found here.
On August 13, FDA announced that it will renew its Peripheral and Central Nervous System Drugs Advisory Committee for an additional 2 years beyond the charter expiration date. The new charter will be in effect until June 4, 2026.
On August 14, WHO declared the spread of mpox in multiple African countries a public health emergency of international concern. This becomes the second such declaration in the past two years called in response to transmission of the virus. HHS released a statement shortly after this declaration stating that the United States will continue to work closely with African governments, Africa CDC and WHO to ensure an effective response to the current outbreak and to protect the health and lives of people of the region.
On August 15, the Centers for Medicare & Medicaid Services (CMS) released the National Summary Report, Executive Summary, and National Summary Results workbook for the 2023 Post-Acute Care (PAC) Health Equity Confidential Feedback Reports. The National Summary Report provides insights on aggregate differences in quality by dual-enrollment status and race/ethnicity in the PAC settings. The National Summary Report, Executive Summary, and National Summary Results workbook can be found on the PAC Quality Reporting Training webpage for HH, IRF, LTCH, and SNF.
On August 15, the Biden Administration announced that it had reached agreements for new prices for all 10 drugs selected for Medicare drug price negotiations. The negotiated prices will go into effect for people with Medicare Part D prescription drug coverage beginning January 1, 2026. The Administration claimed that if the new prices had been in effect in 2023, Medicare would have saved an estimated $6 billion, which would have represented 22% lower net spending in aggregate. Additionally, the Biden Administration estimates that when the negotiated prices go into effect in 2026, people enrolled in Medicare prescription drug coverage would save under the projected defined standard benefit design an estimated $1.5 billion. A fact sheet, including a list of all final negotiated prices, can be found here. In addition to releasing new negotiated drug prices, the Office of the Assistant Secretary for Planning and Evaluation (ASPE) released an issue brief examining how Medicare’s negotiated prices for the selected drugs compare to historical list prices and average transaction prices across all payers in the U.S. market.
On August 16, HHS released a statement regarding disruptions in the availability of BD BACTEC™ blood culture media bottles, which could impact clinical practices for health care providers and laboratories. HHS recommends that health care providers, laboratory professionals, and health care facility administrators prioritize and conserve BD BACTEC blood culture media bottles.
On August 16, HHS Secretary Becerra and CMS Administrator Chiquita Brooks-LaSure released statements commemorating the second anniversary of the Inflation Reduction Act (IRA). Both statements discussed the achievements of the IRA, including delivering lower prescription drug costs and making health insurance more affordable.
On August 16, FDA granted marketing authorization to NOWDiagnostics for the First To Know Syphilis Test. This is the first at-home, over-the-counter test to detect Treponema pallidum (syphilis) antibodies in human blood.
WHITE HOUSE
On August 13, President Biden announced $150 million in Advanced Research Projects Agency for Health (ARPA-H) awards to develop technologies that will allow surgeons to provide more successful tumor-removal surgeries for people facing cancer. The awards will support researchers from eight teams across the country who are pursuing innovative ideas as part of ARPA-H’s Precision Surgical Interventions (PSI) program.
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
HHS Notice of Benefit and Payment Parameters for 2026 (CMS-9888); Proposed Rule; 7/17/24
Amendments to Rules Governing Organ Procurement Organizations (CMS-3409); Proposed Rule; 8/8/24
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
OASH
Organ Procurement and Transplantation: Implementation of the HIV Organ Policy Equity Act; 8/6/24; Proposed Rule
Public Health Service Policies on Research Misconduct; Final Rule; 8/7/24
REPORTS
Office of Inspector General (OIG)
On August 12, OIG released a report examining Medicare improper payments to hospitals for enrollees who received mechanical ventilation. OIG found that Medicare payments to hospitals for inpatient claims with certain MS-DRGs that required more than 96 consecutive hours of mechanical ventilation did not fully comply with Medicare requirements. OIG stated that for 233 of 250 sampled claims, Medicare payments to hospitals complied with requirements. However, for the 17 remaining sampled claims, Medicare payments to hospitals did not comply with requirements. For eight sampled claims, hospitals incorrectly used the procedure code for more than 96 hours of mechanical ventilation when enrollees had not received more than 96 hours of mechanical ventilation. For nine sampled claims, hospitals used incorrect diagnosis codes or incorrectly used a procedure code that was not related to mechanical ventilation. Consequently, the 17 sampled claims were assigned incorrectly to MS-DRGs 207 or 870, resulting in $382,032 of overpayments. On the basis of the sample results, OIG estimated that Medicare improperly paid hospitals $79.4 million during the audit period. OIG recommends that CMS: 1) direct the Medicare Administrative Contractors (MACs) to recover from hospitals the portion of the $382,032 in identified overpayments for the sampled claims during the audit period that are within the 4-year reopening period in accordance with CMS’s policies and procedures; and 2) educate hospitals on correctly counting the hours of mechanical ventilation and submitting claims with correct procedure and diagnosis codes.
On August 13, OIG released a Medicare Advantage compliance audit of diagnosis codes that MMM Healthcare submitted to CMS. OIG found that MMM did not submit some diagnosis codes to CMS for use in the risk adjustment program in accordance with Federal requirements. Although 580 of the 688 sampled enrollees’ HCCs were supported in the medical records and therefore validated, the remaining 108 HCCs were not validated, which resulted in overpayments. These 108 unvalidated HCCs included 11 HCCs for which OIG identified other HCCs for less severe manifestations of the diseases. OIG stated that as a result, MMM received $165,312 in net overpayments. OIG recommends that MMM refund to the Federal Government the $165,312 of net overpayments and continue to improve its policies and procedures to prevent, detect, and correct noncompliance with Federal requirements for diagnosis codes that are used to calculate risk-adjusted payments.
Government Accountability Office (GAO)
On August 15, GAO released a report examining FDA’s postmarket surveillance system for medical devices. GAO found that more than 1.7 million injuries and 83,000 deaths in the U.S. over a 10-year period were potentially linked to medical devices, according to a 2018 study of FDA data. GAO stated that FDA has taken steps to establish an active postmarket surveillance system for medical devices including: establishing a coordinating center in 2016 to partner with FDA to organize a network of data sources; completing, in 2021, the cloud-based data infrastructure necessary to collect evidence of medical device performance while protecting patient privacy; and planning to begin active postmarket surveillance of two medical devices by December 2024, with plans to expand over 5 years. However, GAO found that FDA has faced two key challenges establishing its system, according to agency officials: 1) limited use of unique device identifiers in electronic health records and billing claims, which makes identifying devices used by patients more difficult; and 2) funding considerations to support active surveillance. GAO stated that it will continue to monitor FDA's progress in establishing an active postmarket surveillance system.
Senate
HELP Committee
September 12; TBD
Testimony from Ralph De La Torre, CEO, Steward Health Care System
September 24; 10:00 AM; SD-562
ADDITIONAL POLICY NEWS
On August 12, North Carolina Gov. Roy Cooper (D) announced that all qualifying North Carolina hospitals have agreed to participate in a first-of-its-kind initiative that will provide the hospitals with higher Medicaid payments if medical debt of low- and middle-income patients is relieved. Governor Cooper and State HHS Secretary Kody Kinsley unveiled the proposal six weeks ago and expect it to help 2 million individuals across the state.
On August 14, Trilliant Health, a major health data firm, launched a free version of its nationwide provider directory. The guide has information on 2.9 million providers nationwide. CMS asked for public input on the same concept two years ago but has yet to create its own.