Health Care Watch: June 3, 2023
The following Federal Health Policy (FHP) Strategies Weekly Health Care Watch provides a summary of legislative and regulatory health care activities from May 28 – June 3. 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 27, President Biden and House Speaker Kevin McCarthy (R-CA) reached an agreement to extend the federal debt ceiling. On May 30, the House passed H.R.3746 - Fiscal Responsibility Act of 2023 in a 314-117 bipartisan vote. In addition to suspending the $31.4 trillion debt limit until January 1, 2025, the legislation cuts federal spending by $1.5 trillion over a decade by freezing certain funding that had been projected to increase next year and then limiting that spending to 1% growth in 2025. The legislation also rescinds almost $30 billion in unspent COVID-19 relief money. On June 1, the Senate passed the bill by a bipartisan vote of 63–36, successfully averting a default. The legislation now heads to the President’s desk where he is expected to sign it into law on June 3.
On May 30, Rochelle Walensky, the former director of the Centers for Disease Control and Prevention (CDC) agreed to testify on June 13 before the Select Subcommittee on the Coronavirus Pandemic. The goal of the hearing is to help prepare for a possible future pandemic.
On June 2, Select Subcommittee on the Coronavirus Pandemic Chair Brad Wenstrup (R-OH) sent a letter to Department of Health & Human Services (HHS) Secretary Xavier Becerra requesting access to two unredacted documents from the federal health department as part of the panel’s probe into the origins of COVID-19. The letter requests that these documents be shared no later than June 8.
Senate
On May 30, Sens. Tim Kaine (D-VA) and Joni Ernst (R-IA) announced that they will propose the Disrupt Fentanyl Trafficking Act as an amendment to the National Defense Authorization Act (NDAA). The goal of the act is to make fentanyl trafficking a major priority of the Pentagon.
REGULATORY UPDATE
On May 26, the Centers for Medicare & Medicaid Services (CMS) sent to the Office of Management and Budget (OMB) for review a proposed rule entitled Hospital Outpatient Prospective Payment System: Remedy for 340B-Acquired Drugs Purchased in Cost Years 2018-2022. The proposed rule is related to remedying past underpayments to outpatient hospitals for 340B-acquired drugs. As background, after the Supreme Court’s unanimous June 2022 decision that CMS lacked the statutory authority to implement the Medicare outpatient payment rate cut for 340B-acquired drugs that had been in place since 2018, the U.S. District Court for the District of Columbia ordered CMS to develop a remedy for underpayments to 340B hospitals as a result of the now overturned payment policy.
On May 30, the Department of Veterans Affairs (VA) announced that it is relaxing its masking requirement at medical facilities, no longer requiring universal masking in most clinical areas.
On May 30, the Food & Drug Administration (FDA) proposed overhauling the paper inserts that come in prescription drug packages so that risks and safety information are summarized on a single page.
On May 30, the U.S. Court of Appeals for the Second Circuit ruled that, as part of a proposed bankruptcy settlement, members of the Sackler family who own OxyContin maker Purdue Pharma, could be shielded from current and future civil claims in exchange for paying up to $6 billion in settlements and giving up control of the company. The three-judge panel decision reversed a 2021 lower court ruling against granting the Sackler family immunity from lawsuits on the grounds that they did declare bankruptcy themselves.
On May 31, CMS issued a final rule that formally rescinds the November 2021 Omnibus COVID-19 Health Care Staff Vaccination interim final rule that required health care workers be fully vaccinated for COVID-19 as a condition for facilities to participate in Medicare and Medicaid. Instead, CMS notes that it will use quality reporting and value-based measures and incentives to encourage entities to keep workers “up-to-date” on COVID-19 vaccinations. The final rule also makes permanent policies requiring long-term care providers to educate and provide COVID-19 vaccines to staff and residents and removes expired COVID-19 testing requirements for those populations.
On May 31, FDA approved Pfizer’s respiratory syncytial virus (RSV) vaccine, Abrysvo, for individuals 60 years and older. The CDC Advisory Committee on Immunization Practices (ACIP) will meet on June 21 to discuss recommendations for the appropriate use of RSV vaccines in older adults.
On June 1, CMS Administrator Chiquita Brooks-LaSure announced updates surrounding how individuals can get drugs that may slow the progression of Alzheimer’s disease covered by Medicare. Administrator Brooks-LaSure noted that if the FDA grants traditional approval, Medicare will cover the drugs in appropriate settings that also support the collection of real-world information via a registry to study the usefulness of these drugs for Medicare beneficiaries.
On June 1, the Supreme Court unanimously overturned a 7th Circuit Court of Appeals ruling that SuperValu and Safeway did not "knowingly" violate the False Claims Act when they offered cash-paying customers extended discounts on generic drugs while charging the government full price. The justices said the lower court applied the wrong standard and that companies could not claim a lack of knowledge they were violating the law as a defense. The decision gives the whistleblowers who brought the original lawsuit another shot to pursue allegations that the companies defrauded the Medicare and Medicaid programs.
On June 2, CMS issued a transmittal related to the new claims modifier requirement for drugs from a single-dose container or single-use package billed under Part B. As background, the Infrastructure Investment and Jobs Act required manufacturers to provide a refund to CMS for certain discarded amounts from a refundable single-dose container or single-use package drug. In calendar year 2023 rulemaking, CMS implemented this policy by finalizing new requirements for submitting claims to Medicare under the physician fee schedule, outpatient prospective payment system, and ambulatory surgical center payment systems. Specifically, CMS required the use of the JW modifier to identify discarded amounts, and a new JZ modifier to identify when no drug amount was discarded.
WHITE HOUSE UPDATE
On May 31, officials from the White House Domestic Policy Council, the White House Office of Intergovernmental Affairs, and HHS convened 19 state legislators from 10 states across the country that are working to advance legislation to improve mental health care. During the meeting, legislators discussed steps they are taking at the state level to address the mental health crisis, including improving access to mental health care in schools and universities, funding and expanding “988” services, and boosting the mental health workforce.
On June 1, press reports indicated that President Biden will appoint former North Carolina Health Secretary Mandy Cohen the next director of the CDC.
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
Hospital Outpatient Prospective Payment System: Remedy for 340B-Acquired Drugs Purchased in Cost Years 2018-2022 (CMS-1793); Proposed Rule; 5/26/23
Minimum Staffing Standards for Long-Term Care Facilities (CMS-3442); Proposed Rule; 5/30/23
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 30, OIG released a report examining Medicare payment rates for physician services. OIG found that Medicare sometimes paid higher non-facility rates rather than lower facility rates for physician services while enrollees were receiving services under Part A in skilled nursing facilities (SNFs) or as hospital inpatients. During the two-year audit period, Medicare made overpayments totaling $22,463,193 for 1,130,182 claim lines by paying the non-facility rate for services coded as furnished in a nursing facility or SNF setting without Part A coverage while enrollees were a Part A SNF inpatients. OIG made recommendations to CMS including: that CMS direct its Medicare contractors to recover overpayments identified in the audit; and that CMS notify the appropriate practitioners so that they can exercise reasonable diligence to identify, report, and return any overpayments.
UPCOMING CONGRESSIONAL HEARINGS
House
Energy & Commerce Committee
Subcommittee on Oversight and Investigations
June 7; 10:30 AM; 2322 Rayburn
Looking Back Before Moving Forward: Assessing CDC's Failures in Fulfilling its Mission
Subcommittee on Health
June 9, 9:30 AM; Gettysburg National Park Visitor’s Center
Addressing the Opioid Crisis: Examining the SUPPORT Act Five Years Later
Oversight and Accountability
Subcommittee on the Coronavirus Pandemic
June 13; TBD
Hearing examining how to prepare for future pandemics
Witness: Rochelle Walensky, former Director of the CDC
Ways & Means Committee
Week of June 5
Markup of legislation addressing commercial health insurance affordability
Senate
Veterans Affairs Committee
June 7; 3:00 PM; 418 Russell
An Abiding Commitment to Those Who Served: Examining Veterans’ Access to Long Term Care
Health, Education, Labor & Pensions Committee
June 8; 10:00 AM; 430 Dirksen
Why Are So Many American Youth in a Mental Health Crisis? Exploring Causes and Solutions
Finance Committee
June 8; 10:00 AM; 215 Dirksen
Consolidation and Corporate Ownership in Health Care: Trends and Impacts on Access, Quality, and Costs
Witnesses: Zack Cooper, Associate Professor of Public Health and Associate Professor of Economics, Yale University; Shawn Martin, Vice President and Chief Executive Officer, American Academy of Family Physicians; Karen Maddox, Associate Professor of Medicine, Washington University; Chris Thomas, President and Chief Executive Officer, Community Hospital; Caroline Pearson, Executive Director, Peterson Center on Healthcare.
OTHER POLICY NEWS
On May 30, the Journal of the American Medical Association (JAMA) published a study finding that a lack of availability of opioid use disorder medication at local pharmacies across the country might be a barrier to treatment. The study found that only 58% of pharmacies reported having buprenorphine/naloxone in stock at the time of request, according to the study, with substantial differences among states and pharmacy chains. Additionally, the study found that chain pharmacies were more likely to report stock of the medications over independent pharmacies – 62% to 45%.
On May 31, GAO announced the appointment of three new members to the Medicare Payment Advisory Commission (MedPAC), as well as the reappointment of three current members, one of whom will continue to serve as chair. The newly appointed members, whose terms began in May 2023 and will expire in April 2026, are Tamara Konetzka, and Brian Miller, MD, MBA, MPH. Gina Upchurch, RPh, MPH was also appointed; however, her term expires in 2024 as she is serving the remaining term for a member who recently resigned. The reappointed members, whose terms will expire in April 2026, are Michael Chernew, Betty Rambur, and Wayne Riley, MD.