Health Care Watch: June 17, 2023
The following Federal Health Policy (FHP) Strategies Weekly Health Care Watch provides a summary of legislative and regulatory health care activities from June 11 – June 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
On June 12, Energy & Commerce Chair Cathy McMorris Rodgers (R-WA) and Senate Finance Committee Ranking Member Mike Crapo (R-ID) sent a request for information (RFI) to various stakeholders on the scope of drug shortages. The RFI asks for responses on what market conditions lead to drug shortages and how the Centers for Medicare & Medicaid Services (CMS) can better address the economic conditions that are driving drug shortages.
On June 13, the Education & the Workforce Committee advanced legislation that would permanently allow employers to offer telehealth as a tax-free benefit separate from their group health insurance plans. H.R. 824, the Telehealth Benefit Expansion for Workers Act of 2023, aims to ensure that workers do not lose access to telehealth services they accessed because of the flexibilities granted during the COVID-19 pandemic.
On June 14, the Appropriations Committee advanced the Agriculture, Rural Development, Food and Drug Administration (FDA), and Related Agencies spending bill. The legislation was advanced in a 34-27 vote and allocates $17.838 billion to the departments.
On June 15, a bipartisan group of Energy & Commerce members announced their intention to reform Medicare physician payments and injecting more money into the system. This effort will commence with a hearing on June 21.
Senate
On June 12, a group of 34 Republican lawmakers, led by Sens. Bill Hagerty (R-TN) and John Kennedy (R-LA), filed an amicus brief before the U.S. Court of Appeals for the Fifth Circuit urging the court to uphold gene-sequencing company Illumina’s acquisition of cancer test-maker Grail. The Federal Trade Commission (FTC) sued to block the deal in 2021 but lost an administrative trial in the agency’s in-house court last year. That ruling was overturned by the FTC’s four commissioners in April. Now, the companies have appealed, challenging both the ruling against the merger and the constitutionality of the FTC’s decision-making process.
On June 13, the Patients Before Middlemen (PBM) Act of 2023 was introduced by Sens. Robert Menendez (D-NJ) and Marsha Blackburn (R-TN). The legislation would prohibit PBMs from incorporating fees, pharmaceutical company rebates and other costs into prescription drug prices for Medicare Part D plans.
On June 15, Sens. Brian Schatz (D-HI) and Roger Wicker (R-MS) and Reps. Mike Thompson (D-CA) and David Schweikert (R-AZ) introduced the latest edition of the CONNECT for Health Act. The legislation would permanently extend rules that have allowed Medicare patients to access virtual care during the COVID-19 pandemic. The legislation would also repeal Medicare’s in-person requirement for virtual mental health care.
Majority Leader Chuck Schumer (D-NY) intends to bring legislation to the floor the week of July 24 that would reform the PBM industry and place a monthly cap on commercial insulation costs.
REGULATORY UPDATE
On June 12, Department of Health & Human Services (HHS) Secretary Xavier Becerra sent a letter to governors announcing a slate of new flexibilities for states to use when reevaluating their Medicaid rolls. The letter urges states to take more comprehensive steps to minimize coverage losses during the unwinding of Medicaid’s pandemic-era continuous enrollment requirement. In this letter, Secretary Becerra announced new flexibilities to help keep Americans covered as states resume Medicaid and Children’s Health Insurance Program (CHIP) renewals, which can be found here.
On June 13, the he U.S. Court of Appeals for the Fifth Circuit maintained a freeze on a ruling that struck down the Affordable Care Act's (ACA’s) mandate that employers and insurers fully cover preventive health services such as coverage for certain cancer screenings, behavioral counseling, and HIV prevention. The legal challenge continues to make its way through the court system.
On June 13, HHS announced new measures to reduce prescription drug costs, targeting low-income seniors and people with disabilities. The Administration for Community Living will implement targeted efforts to reach and enroll eligible individuals in the Extra Help program, which was expanded at the beginning of 2023, under the Inflation Reduction Act (IRA). This program helps seniors and individuals with disabilities in paying for their Medicare Part D premiums.
On June 13, CMS announced New York’s extension of comprehensive coverage after pregnancy through Medicaid and the Children’s Health Insurance Program for postpartum individuals for a full 12 months.
On June 13, the Biden Administration released its Spring Regulatory Agenda, which reports on the actions administrative agencies plan to issue in the near and long term.
On June 14, the Centers for Medicare & Medicaid Services’ (CMS) Office of the Actuary released projections of National Health Expenditures (NHE) and health insurance enrollment for the years 2022-2031. CMS estimates that from 2022-2031, average annual growth in NHE (5.4%) will outpace average annual growth in gross domestic product (GDP) (4.6%), resulting in an increase in the health spending share of GDP from 18.3% in 2021 to 19.6% in 2031. The report also highlights impacts from the IRA, including projections that those with Medicare prescription drug coverage will experience lower out-of-pocket spending on prescription drugs for 2024 and beyond. Additional projections can be found here.
On June 14, the Health Resources and Services Administration (HRSA), announced awards of nearly $9 million to strengthen and expand the mental health and substance use workforce in underserved and rural communities. This funding will provide support to 20 grantees to train health care providers to provide care for individuals in need of mental health and substance use services.
On June 15, CMS announced that Amy Larrick, Director of the Medicare Drug Benefit and C & D Data Group (MDBG), is leaving the agency after 18 years of service. Vanessa Duran, who has been serving as the Deputy Director of MDBG since 2020, will assume the role of Acting Director.
On June 15, FDA’s Vaccine and Related Biological Products Committee voted 21-0 to recommend that the next iteration of COVID-19 vaccines protect against one variant of the XBB strain. The committee also agreed that manufacturers should use XBB.1.5 as the specific descendant lineage, which makes up roughly 40% of COVID-19 cases in the U.S. The recommendation follows a plan FDA outlined in January, which suggested that most adults and children with previous vaccinations would get a single booster shot for COVID ahead of the colder weather season when cases of respiratory illness increase.
On June 16, Bristol Myers Squibb (BMS) announced that the manufacturer filed a lawsuit challenging the constitutionality of the IRA’s drug negotiation program in the U.S. District Court for the District of New Jersey. Similar to an earlier lawsuit filed by Merck challenging the IRA, the lawsuit challenges the law on Fifth Amendment and First Amendment grounds. Specifically, BMS argues that the IRA violates the Fifth Amendment by requiring BMS and other manufacturers “to provide innovative medicines to third parties at prices set by the government, without any requirement that those prices reflect fair market value.” BMS also argues that the IRA violates the First Amendment by forcing manufacturers to state publicly that the government’s price setting is a true negotiation that resulted in a fair price.
WHITE HOUSE UPDATE
On June 16, President Biden formally announced his intent to appoint Dr. Mandy Cohen as Director of the Centers for Disease Control and Prevention. From 2017 to 2021, Cohen served as health secretary in North Carolina.
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
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
Minimum Staffing Standards for Long-Term Care Facilities (CMS-3442); Proposed Rule; 5/30/23
Request for Information; Episode-based Payment Model (CMS-5540-NC); Notice; 6/9/23
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
Fixed-Combinations and Single-Entity Versions of Previously Approved Antiretrovirals for the Treatment or Prevention of Human Immunodeficiency Virus-One Under the President's Emergency Plan for Acquir; Notice; 6/12/23
Prescription Drug User Fee Act Waivers, Reductions, and Refunds for Fixed-Combinations and Single-Entity Versions of Previously Approved Antiretrovirals under the President's Emergency Plan for Acquir; Notice; 6/12/23
Clinical Considerations for Studies of Devices Intended to Treat Opioid Use Disorder; Draft Guidance for Industry and Food and Drug Administration Staff; Availability; 6/12/23
Prohibition on Wholesaling Under Section 503B of the Federal Food, Drug, and Cosmetic Act; Draft Guidance for Industry; Availability (2021-103); Notice; 6/13/23
REPORTS
Medicare Payment Advisory Commission (MedPAC)
On June 15, MedPAC released its June 2023 Report to the Congress: Medicare and the Health Care Delivery System. MedPAC reports on issues affecting the Medicare program as well as broader changes in health care delivery and the market for health care services. The report contains chapters on ways to address high prices of drugs covered under Medicare Part B; assessment of post-sale rebates for prescription drugs in Medicare Part D; standardized benefits in Medicare Advantage (MA) plans; disparities in outcomes for Medicare beneficiaries with different social risks, behavioral health services in the Medicare program; telehealth in Medicare; alignment of fee-for-service payment rates across ambulatory settings; reforms to Medicare’s wage index systems; and an evaluation of a prototype design for a post-acute care prospective payment system.
Medicaid and CHIP Payment and Access Commission (MACPAC)
On June 15, MACPAC released the June 2023 Report to Congress on Medicaid and CHIP. The report contains four chapters on automatic adjustments to disproportionate share hospital payments, integration of care for dually eligible beneficiaries, access to Medicaid coverage and care during and after incarceration, and barriers to Medicaid home- and community-based services (HCBS).
UPCOMING CONGRESSIONAL HEARINGS
House
Energy and Commerce Committee
Health Subcommittee
June 21; 10:00 AM; 2322 Rayburn
Responding to America's Overdose Crisis: An Examination of Legislation to Build Upon the SUPPORT Act
Witnesses: Matthew Strait, Deputy Assistant Administrator, Office of Diversion Control, Drug Enforcement Administration; Dr. Christopher Jones, Director of the National Center for Injury Prevention and Control, CDC; Tom Coderre, Acting Deputy Assistant Secretary for Mental Health and Substance Use; Diana Espinosa, Principal Deputy Administrator of the Health Resources and Services Administration, Acting Deputy Assistant Secretary for Mental Health and Substance Use; Jonathan Blum, MPP, Principal Deputy Administrator and Chief Operating Officer, CMS.
Oversight and Investigations Subcommittee
June 22; 10:30 AM; 2322 Rayburn
MACRA Checkup: Assessing Implementation and Challenges that Remain for Patients and Doctors
Senate
Health, Education, Labor & Pensions Committee
June 21; 10:00 AM; 430 Dirksen
Executive Session: S. 728, S. 1664, and S. 567
Legislation to be considered: S. 728, Paycheck Fairness Act; S. 1664, Healthy Families Act; S.567, Richard L. Trumka Protecting the Right to Organize Act of 2023
Appropriations Committee
June 22; 10:30 AM; 106 Dirksen
Legislation to be considered: Military Construction, Veterans Affairs, and Related Agencies Appropriations Act, 2024; Agriculture, Rural Development, Food and Drug Administration, and Related Agencies Appropriations Act, 2024
OTHER HEALTH POLICY NEWS
On June 14, the American Medical Association (AMA) issued a press release announcing that the AMA House of Delegate adopted a policy during its Annual Meeting calling for greater regulatory oversight of insurers’ use of artificial intelligence (AI) in reviewing patient claims and prior authorization requests. The release notes: “[w]hile the AMA supports automation to speed up the prior authorization process and cut down on the burdensome paperwork required by physicians, the fact remains that prior authorization is overused, costly, inefficient, and responsible for patient care delays.”
On June 14, MedPAC announced that Executive Director James E. Mathews, Ph.D., will leave the agency at the end of August. Dr. Mathews has led MedPAC since November of 2017, and previously served as its Deputy Director for nearly a decade. Paul Masi, Unit Chief of the Health Systems and Medicare Cost Estimates Unit at the Congressional Budget Office (CBO), has been appointed as MedPAC’s next Executive Director.