Health Care Watch: May 26, 2023
The following Federal Health Policy (FHP) Strategies Weekly Health Care Watch provides a summary of legislative and regulatory health care activities from May 20 – May 26. 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
Republican Leadership and White House staff continue to negotiate a deal to extend the federal debt ceiling. On May 26, Treasury Secretary Janet Yellen said that lawmakers now have until June 5 to raise the debt limit and avoid a default, providing negotiators a few more days to reach a deal. Secretary Yellen previously said the debt limit could be reached by June 1. While negotiators are making progress, a major sticking point remains on work requirements for certain federal programs and permitting reforms. Agreement has reportedly been reached to extend the debt ceiling through 2024, implement spending caps on non-Defense and non-veterans’ programs for two years, rescind unspent COVID funds, and incentivize Congress to pass its individual appropriations bills.
On May 23, the House Oversight & Accountability Committee held a hearing to discuss pharmacy benefit manager (PBM) oversight. The hearing featured testimony from Miriam Atkins, MD, FACP, President, Community Oncology Alliance; Greg Baker, CEO of AffirmedRx; Kevin J. Duane, PharmD; and Frederick Isasi JD, MPH, Executive Director, Families USA. The hearing focused on PBMs’ impact on patient health, independent pharmacies and access to care. The committee discussed PBM practices that may negatively impact both patients and independent pharmacies, as well as the problems of transparency and high drug costs. Following the conclusion of the hearing, the committee issued a press release indicating their commitment to examining PBM practices to inform legislative solutions.
On May 24, the Energy & Commerce Committee advanced 19 bills to the full House, including:
H.R. 1418, the Animal Drug User Fee Amendments of 2023 (49-0);
H.R. 2544, the Securing the U.S. Organ Procurement and Transplantation Network Act (49-0);
H.R. 3561, the Promoting Access to Treatments and Increasing Extremely Needed Transparency (PATIENT) Act of 2023 (49-0);
H.R. 2666, the Medicaid VBPs for Patients (MVP) Act (31-19);
H.R. 3284, the Providers and Payers COMPETE Act (49-0); and
H.R. 3290, To amend title III of the Public Health Service Act to ensure transparency and oversight of the 340B drug discount program (29-22).
A background memo containing bill summaries can be found here.
On May 25, the House passed the HALT Fentanyl Act by a vote of 289-133. This legislation would classify street versions of fentanyl as a Schedule I controlled substance, making it subject to enhanced penalties and regulation.
On May 25, 35 House conservative Republicans sent a letter to Speaker Kevin McCarthy (R-CA) urging that he hold the line while negotiating with the White House on the debt ceiling and build upon the House-passed Limit, Save, Grow Act.
The House is scheduled to return from its Memorial Day recess on June 5 but will likely return earlier to consider legislation to extend the federal debt limit.
Senate
On May 22, Finance Committee member Sen. Tom Carper (D-DE) announced that he will retire at the end of the Congress. Rep. Lisa Blunt Rochester, who serves on the Energy & Commerce Health Subcommittee, is expected to run for the Senate seat.
The Senate returns from its Memorial Day recess on May 30.
REGULATORY UPDATE
On May 23, CMS issued a proposed rule entitled, Medicaid Program: Misclassification of Drugs, Program Administration and Program Integrity Updates under the Medicaid Drug Rebate Program. The proposed rule would implement policies in the Medicaid Drug Rebate Program (MDRP) to address drug misclassification, as well as drug pricing and product data misreporting by manufacturers. The rule also proposes several other program integrity and program administration provisions or modifications including revising and proposing key definitions used in the MDRP. Additionally, the rule designates a time limitation on manufacturers initiating audits with States; clarifies and establishes requirements for State fee-for-service pharmacy reimbursement; clarifies the requirement of accumulating price concessions when determining Best Price; and proposes new contracting requirements between states, Medicaid managed care plans and third-party contractors such as PBMs to reflect transparent reporting of drug payment information among third-party contractors. Finally, the rule would allow CMS to conduct a drug price verification survey aimed at increasing transparency about why certain drug prices are expensive for Medicaid and helping states better negotiate what Medicaid pays for high-cost drugs. Comments on the rule are due by July 25, 2023.
On May 25, FDA approved Pfizer’s COVID-19 drug Paxlovid. The approval marks the first oral antiviral pill approved to treat COVID-19 in adults ages 18 and older who are at high risk for progressing to severe disease. The approval does not apply to adolescents ages 12 to 17, although Paxlovid will still be available under emergency use authorization for that age group.
On May 25, the Substance Abuse and Mental Health Services Administration (SAMHSA) awarded 13 grants to communities to create new and enhance existing mobile crisis response teams, which will respond to mental health and substance use crises in high-need areas, in coordination with local law enforcement. Recipients of this funding are required to build crisis system capacity by offering post-crisis follow-up, developing and implementing criteria for coordination with law enforcement, providing evidence-based crisis training to health care providers and first responders, mapping community crisis systems, and enhancing the use of data. Grantees may also support a range of other allowable activities that enhance their crisis systems.
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
Treatment of Medicare Part C Days in the Calculation of a Hospital's Medicare Disproportionate Patient Percentage (CMS-1739); Final Rule; 4/6/23
CY 2024 Revisions to Payment Policies under the Physician Fee Schedule and Other Revisions to Medicare; Proposed Rule; 4/18/23
Short-Term Limited Duration Insurance; Update (CMS-9904); Proposed Rule; 4/20/23
CY 2024 Hospital Outpatient PPS Policy Changes and Payment Rates and Ambulatory Surgical Center Payment System Policy Changes and Payment Rates (CMS-1786); Proposed Rule; 4/20/23
CY 2024 Changes to the End-Stage Renal Disease (ESRD) Prospective Payment System and Quality Incentive Program (CMS-1782); Proposed Rule; 4/21/23
CY 2024 Home Health Prospective Payment System Rate Update and Home Infusion Therapy Services Payment Update (CMS-1780); Proposed Rule; 4/24/23
Transitional Coverage for Emerging Technologies (CMS-3421); Notice; 4/24/23
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
REPORTS
Office of Inspector General (OIG)
On May 23, OIG released a report assessing whether selected health centers used their COVID-19 supplemental grant funding in accordance with Federal requirements and grant terms. OIG examined grant funding totaling over $70 million awarded during fiscal year 2020 to 30 selected health centers. OIG found that 17 of the 30 selected health centers did not use or may not have used a portion of their COVID-19 supplemental grant funding as required under Federal requirements and grant terms. OIG recommended that HRSA require sampled health centers to return unallowable or improperly allocated costs to the federal government, and assist non-compliant health centers to ensure grant funding is used for allowable purposes.
On May 24, OIG released a report assessing the effectiveness of CMS’ cybersecurity defenses, identifying potential indicators of compromise, and determining whether any breaches have gone undetected, and reviewing its incident response capabilities. OIG found that although CMS had implemented some security controls for detecting and preventing threats on its network, CMS’ cybersecurity controls needed improvements to better detect and prevent cyber threats on its network. OIG recommended that CMS: (1) remediate the security control findings OIG identified; (2) update security controls to align with current “NIST SP 800-53” requirements; and (3) enhance policies and procedures to periodically identify and assess whether security controls are in place and operating effectively and remediate weak controls timely.
Congressional Budget Office (CBO)
On May 24, CBO released updated projections of health insurance coverage for people under age 65. CMS projects that enrollment in Medicaid and enrollment in marketplace plans have reached historic highs in 2023, mostly because of temporary policies (put in place during the pandemic) that kept beneficiaries enrolled in Medicaid and that enhanced the subsidies for health insurance purchased through marketplaces. The share of the population under age 65 that is uninsured is at a historic low of 8.3% but is expected to increase to 10.1% by 2033. CBO also projects that private health insurance premiums will increase more in the near-term to reflect a return to normal levels of utilization (estimated average of 5.9% in 2024 and 2025), and then lower to an estimated 4.6% growth over the 2028–2033 period.
UPCOMING CONGRESSIONAL HEARINGS
House
Ways & Means Committee
June 7, time TBD
Hearing on wellness-related issues
Witnesses: TBD