Health Care Watch: September 6, 2021
The following FHP Weekly Health Care Watch provides a summary of legislative and regulatory health care activities from August 30 – September 5. 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.
**NOTE TO READERS: The FHP Strategies Weekly Health Care Watch will not publish next week.**
NON-CORONAVIRUS LEGISLATIVE UPDATE
House
On September 1, the Energy & Commerce and Oversight & Reform Committees requestedinformation from the Food & Drug Administration (FDA) regarding the review and accelerated approval of Biogen’s Alzheimer’s drug, Aduhelm, and voiced concern regarding potential anomalies in the FDA’s accelerated approval processes surrounding its review of Aduhelm, the opposition from experts following the approval, and potential improper interactions between the FDA and Biogen throughout the approval process.
On September 3, Ways & Means Chairman Richard Neal (D-MA) and Energy & Commerce Committee Chairman Frank Pallone (D-NJ) introduced sweeping skilled nursing facility legislation. A section-by-section summary can be found here and the legislative text can be found here.
Committees have until September 15 to assemble the $3.5 trillion budget reconciliation legislation. Democrats are discussing health priorities to be included in the package, including:
Expanding Medicare to cover vision, dental, and hearing;
Closing the Medicaid "coverage gap” in non-expanded states;
Tying Medicare drug reimbursement to a domestic benchmark;
Extending premium subsidies to purchase coverage through the Affordable Care Act (ACA) insurance marketplaces; and
Funding for home and community-based services.
The package is not expected to include a provision to lower Medicare’s eligibility age. It is estimated that between $500 and $700 billion will be spent on health care policies which would be at least partially offset by drug pricing reforms and repealing the prescription drug rebate rule.
The House will return from recess on September 20.
Senate
On September 1, Sen. Joe Manchin (D-WV) urged Democrats to prioritize the U.S. withdrawal from Afghanistan and the increase of COVID-19 cases before pursuing the $3.5 trillion reconciliation package. On September 2, Sen. Manchin released an op-ed in the Wall Street Journal reiterating this message, stating that he “won’t support a $3.5 trillion bill, or anywhere near that level of spending, without greater clarity about why Congress chooses to ignore the serious effects of inflation and debt have on existing government programs” and argued such a package “will create a disastrous future for the next generation of Americans.”
The Senate will return from recess on September 13. It is expected to bypass Committee markups and consider the $3.5 trillion reconciliation package on the floor the week of October 4.
NON-CORONAVIRUS REGULATORY UPDATE
On August 27, the White House Office of Management & Budget (OMB) received a proposed rule entitled Medicare Coverage of Innovative Technology (MCIT) and Definition of "Reasonable and Necessary" (CMS-3372). As background, on May 14, the Biden administration delayed until December 15 the implementation of the Trump-era MCIT final rule that sets up a new Medicare coverage pathway (MCIT) allowing coverage of Breakthrough Devices for four years as soon as FDA authorizes the technology. Coverage beyond that would hinge on additional data collected by the manufacturer. The rule also codified the Medicare definition of reasonable and necessary, which applies beyond medical devices. The proposed rule sent to OMB could either rescind or modify the Trump-era rule, including the MCIT pathway.
On August 31, the Centers for Disease Control and Prevention (CDC) National Center for Health Statistics released a report estimating that about 90% of all Americans had health insurance coverage in 2020. Among adults 18–64, 13.9% were uninsured, 20.5% had public coverage, and 67.5% had private health insurance coverage.
On August 31, OMB received a notice from the FDA entitled Hospital and Health System Compounding Under Section 503A of the Federal Food, Drug, and Cosmetic Act; Revised Draft Guidance for Industry; Availability.
On August 31, OMB received a proposed rule from the Health & Human Services (HHS) Office of the Secretary entitled Securing Updated and Necessary Statutory Evaluations Timely.
On September 1, HHS issued a notice entitled FDA; Delegation of Authority. The notice revokes a previous rule that required the HHS Secretary to sign off on any FDA rulemaking.
The National Vaccine Advisory Committee (NVAC) will hold a virtual meeting on September 14 and 15 to discuss vaccine safety, vaccine development, and communication activities.
The Medicare Evidence Development & Coverage Advisory Committee (MEDCAC) will hold a public meeting on September 22 to examine relevant health outcomes in studies for cerebrovascular disease treatment, with a particular focus on new technologies of interest to CMS.
The CDC Advisory Committee on Immunization Practices (ACIP) will hold a meeting on September 29and 30 to review and revise the list of vaccines for administration to vaccine-eligible children through the Vaccines for Children program.
NON-CORONAVIRUS WHITE HOUSE UPDATE
None of note.
CORONAVIRUS UPDATE
House
Nothing of note.
Senate
Nothing of note.
Regulatory
On August 30, CMS announced it will provide guidance and information to states about additional funding for states to promote the importance of COVID-19 vaccination and testing for eligible children and adults enrolled in Medicaid and CHIP.
On August 30, the CDC ACIP held a meeting to discuss COVID-19 vaccines and boosters. The Committee supported COVID-19 boosters for health care workers, long-term care residents, and other groups that were vaccinated soon after COVID-19 vaccines were granted Emergency Use Authorization (EUA) but did not make recommendations. The Committee noted that booster dose data still needs to be properly reviewed and recommendations will be coordinated with the FDA for regulatory allowance. The Committee also unanimously recommended the Pfizer COVID-19 vaccine as a fully approved vaccine. During the meeting, a representative from Pfizer noted that it may not have clinical-trial efficacy data for the Pfizer COVID-19 vaccine booster until October. The agenda for this meeting is available here.
On August 30, CDC released guidance determining that those participating in the Novavax COVID-19 vaccine Phase III trial can be considered fully vaccinated two weeks after completing the two-dose vaccine regimen.
On August 31, CMS released the annual Medicare Trustees Report. The report predicted Medicare’s Hospital Insurance (Part A) will run out of money in 2026, the same as last year’s report. The report notes that COVID-19 dramatically affected Medicare’s short-term financing and spending, but it is not expected to have a large effect on the financial status of the trust funds after 2024. The report does not include the potential effects of Medicare coverage of the Alzheimer’s disease drug Aduhelm due to the uncertainty associated with the current lack of coverage determination. The report notes that current projections indicate that Medicare still faces a substantial financial shortfall that will need to be addressed with further legislation and recommended that legislation should be enacted sooner rather than later to minimize the impact on beneficiaries, providers, and taxpayers. In 2020, the program spent $925.8 billion and served 62.6 million people.
On August 31, CDC released a study that found that patients with COVID-19 had nearly 16 times the risk for myocarditis compared with patients who did not have COVID-19.
On August 31, Secretary of State Tony Blinken and HHS Secretary Xavier Becerra published a joint op-ed in JAMA calling to strengthen global health security, reforming international health regulations, and making the world safer from future pandemics.
On September 1, the CDC released data that pharmacies and state governments have thrown away at least 15.1 million COVID-19 vaccine doses since March 1, 2021.
The FDA Vaccines and Related Biological Products Advisory Committee will hold a meeting on September 17 to discuss COVID-19 vaccine booster shots.
The FDA Center for Biologics Research and Evaluation will hold a meeting on September 27 to discuss the Pfizer COVID-19 booster.
The COVID-19 Health Equity Task Force will hold a meeting on September 30 to present and vote on the final recommendations for mitigating inequities caused or exacerbated by COVID-19 and for preventing inequities in the future.
White House
On September 2, White House COVID-19 Response Chief Jeff Zients announced a $3 billion investment in the domestic COVID-19 vaccine supply chain to expand U.S. manufacturing of critical vaccine inputs and expand fill-finish capacity.
On September 3, White House Office of Science and Technology Policy Director Eric Lander announced $65.3 billion in funding to advance science, technology, and core capabilities to protect the U.S. against future and potentially catastrophic biological threats.
Other
On August 30, a study published by the American College of Physicians in the Annals of Internal Medicine found that Pfizer and Moderna COVID-19 vaccines produced reduced antibody levels in vaccinated immunocompromised people with chronic inflammatory disease treated with immunosuppressive medications, compared to healthy people.
On August 30, a study published in JAMA found that the Moderna COVID-19 vaccine generated more than double the antibodies than the Pfizer vaccine.
On August 31, GlaxoSmithKline (GSK) and South Korea’s SK Bioscience launched a Phase III clinical study of SK’s COVID-19 vaccine candidate and GSK’s COVID-19 vaccine booster to evaluate its safety and efficacy compared to other COVID-19 vaccines.
On August 31, the World Health Organization (WHO) announced that the COVID-19 variant that was first detected in South Africa does not appear to be spreading. The WHO also advocated for third COVID-19 doses to be prioritized for vulnerable populations, such as immunocompromised people. On September 1, the WHO added a new COVID-19 variant, ‘mu’, which originated in Columbia, to the list of interest to monitor.
On September 1, Merck launched a Phase III trial of its experimental oral antiviral drug, molnupiravir for the prevention of COVID-19.
On September 1, Moderna announced it has submitted COVID-19 booster vaccine data to the FDA for authorization. The data submitted showed that a 50 µg dose level, which is a reduced dose of its existing vaccine dose, provided strong protection against the delta variant.
On September 1, a study published in The Lancet found that those fully vaccinated who experience breakthrough COVID-19 have a lower likelihood of developing long COVID-19 symptoms than unvaccinated people.
On September 1, Pfizer launched a Phase II/III clinical trial for an oral COVID-19 treatment.
On September 2, the European Centre for Disease Prevention and Control announced that there is not an urgent need for COVID-19 vaccine booster for the fully vaccinated.
On September 2, an Israeli study that has not been peer-reviewed found that Pfizer COVID-19 booster shots significantly decreased the risk of infection and severe COVID-19 by over 10-fold after 12 days.
As of September 5, nearly 207 million people in the U.S. have received the first dose of COVID-19 vaccines (nearly 176 million have received both doses) and nearly 447 million doses have been distributed, according to the CDC COVID Data Tracker.
As of September 5, the U.S. had nearly 40 million confirmed COVID-19 cases resulting in 648,268 deaths, according to the Johns Hopkins University & Medicine Coronavirus Resource Center.
RULES AT THE WHITE HOUSE OMB
HHS-CMS
Modification of Limitations on Redesignation by the Medicare Geographic Classification Review Board (CMS-1762); Interim Final Rule; Received 2/26/21
Basic Health Program; Federal Funding Methodology for Program Year 2022 (CMS-2438); Final Rule; Received 5/12/21
Reporting Requirements Related to Air Ambulance and Agent and Broker Services and HHS Enforcement Provisions; Proposed Rule; 7/7/21
Medicare Coverage of Innovative Technology (MCIT) and Definition of “Reasonable and Necessary” (CMS-3372); Proposed Rule; 8/27/21
HHS-FDA
Drug Supply Chain Security Act Implementation: Identification of Suspect Product and Notification; Guidance for Industry; Availability; Notice; 5/11/21
Definitions of Suspect Product and Illegitimate Product for Verification Obligations Under the Drug Supply Chain Security Act; Draft Guidance for Industry; Availability; Notice; Received 5/11/21
Product Identifiers Under the Drug Supply Chain Security Act Questions and Answers; Guidance for Industry; Availability; Notice; 5/11/21
Enhanced Drug Distribution Security at the Package Level Under the Drug Supply Chain Security Act; Draft Guidance for Industry; Availability; Notice; 5/11/21
Medical Devices; Ear, Nose and Throat Devices; Establishing Over-the-Counter Hearing Aids and Aligning Other Regulations; Proposed Rule; 8/18/21
Regulatory Requirements for Hearing Aid Devices and Personal Sound Amplification Products; Draft Guidance for Industry and Food and Drug Administration Staff; Availability; Notice; 8/18/21
Patient Protection and Affordable Care Act; Updating Payment Parameters and Improving Health Insurance Markets for 2022 and Beyond (CMS-9906); Final Rule; 8/19/21
Hospital and Health System Compounding Under Section 503A of the Federal Food, Drug, and Cosmetic Act; Revised Draft Guidance for Industry; Availability; Notice; 8/31/21
Department of Labor-Employee Benefits Security Administration
Requirements Related to Surprise Billing, Part 2; Interim Final Rule; 8/2/21
HHS-Office of the Secretary
Securing Updated and Necessary Statutory Evaluations Timely; Proposed Rule; 8/31/21
REPORTS
HHS Office of Inspector General (OIG)
On September 1, OIG released a report entitled Medicare Beneficiaries Hospitalized With COVID-19 Experienced a Wide Range of Serious, Complex Conditions. The report found that during surges in COVID-19 hospitalizations, Medicare beneficiaries were treated for a wide range of serious, complex conditions, including acute respiratory issues; acute kidney failure; acute circulatory issues; significant endocrine, nutritional, or metabolic issues; and sepsis. OIG found that more than 50% of Medicare beneficiaries hospitalized with COVID-19 received intensive care or mechanical ventilation. The report also found that dually eligible, Black, Hispanic, or older beneficiaries were disproportionately hospitalized with COVID-19 localities. OIG concluded that the complex needs of hospitalized Medicare beneficiaries may create substantial challenges in meeting the needs of these patients and that gaining a better understanding of Medicare beneficiaries hospitalized with COVID-19 can assist Federal, State, and local efforts in the COVID-19 pandemic and may be used to provide additional guidance to hospitals. OIG also noted that this study can also help hospitals, physicians, and other practitioners better prepare for the complex and resource-intensive care needs of Medicare beneficiaries with COVID-19, and CMS can also use this information to identify beneficiaries who are particularly vulnerable to hospitalization as well as to understand the needs of these beneficiaries during their hospitalizations. Finally, OIG suggested that this analysis shows that Medicare claims data can be used to enhance knowledge around the treatment of COVID-19 and help inform additional research efforts. An interactive map that accompanies the report is available here. A summary of the report is available here.
On September 1, OIG released a report entitled The National Human Genome Research Institute (NHGRI) Should Strengthen Procedures in Its Pre-Award Process To Assess Risk for Certain Foreign and Higher Risk Applicants. The report found that NHGRI generally had adequate policies and procedures in place for assessing risk in its grant pre-award process when awarding grant funds but had inadequate policies and procedures as they relate to assessing the risk to NHGRI grant programs presented by foreign applicants and mitigating potential risk associated with applicants demonstrating higher risk factors. OIG recommended that NIH direct NHGRI to improve its policies and procedures to ensure Grants Specialists monitor whether required audit reports are submitted for foreign applicants; clarify existing procedures to specify when Grants Specialists should take additional steps, including the imposition of specific award conditions, to mitigate risk for new grantees; and update policies and procedures for Grants Specialists to require that they review available Internal Revenue Service Form 990s regarding grant applicants’ risk factors before awarding grant funds. The NIH agreed with some of the recommendations. A summary of the report is available here.
On September 2, OIG released a report entitled Kansas Made Capitation Payments to Managed Care Organizations (MCOs) After Beneficiaries’ Deaths. The report found that Kansas made at least $17.3 million in unallowable capitation payments to MCOs on behalf of deceased beneficiaries and claimed at least $9.7 million in unallowable Federal reimbursement. OIG recommended that Kansas identify, refund, and recover unallowable capitation payments, and strengthen internal controls and policies and procedures regarding accurate and timely updates to Kansas’s eligibility system and the accurate reporting of all Medicaid expenditures, to include prior-period adjustments. Kansas stated that OIG analysis resulted in legitimate findings of incorrect capitation payments and described corrective actions it had taken or planned to take. A summary of the report is available here.
On September 3, OIG released a report entitled CMS’ COVID-19 Data Included Required Information From the Vast Majority of Nursing Homes, but CMS Could Take Actions To Improve Completeness and Accuracy of the Data. The report found that CMS’ COVID-19 data for nursing homes included the required data from most nursing homes, however, the data were not complete or accurate for some nursing homes. CMS’ COVID-19 data did not include all the COVID-19 data that nursing homes were required to report and were not complete or accurate after CMS had performed its quality assurance checks. OIG also identified two areas in which CMS could take additional actions to help ensure that its COVID-19 data are complete and accurate: CMS could provide technical assistance to all nursing homes that fail its quality assurance checks, and CMS could make additional efforts to ensure that CMS’s and States’ COVID-19 data elements are comparable and reported data are not substantially different. OIG identified that when CMS’ COVID-19 data are complete and accurate, Federal and State officials and other stakeholders may be able to more effectively monitor trends in infection rates and develop public health policies when making decisions about how to ensure the health and safety of nursing home residents and staff. OIG recommend that CMS assess the costs and benefits of implementing the six recommendations listed in our report and if CMS determines that the benefits outweigh the costs, take action to implement the recommendations. CMS agreed with three of the recommendations but did not agree with the other three recommendations. A summary of the report is available here.
Congressional Budget Office (CBO)
Nothing of note.
UPCOMING CONGRESSIONAL HEARINGS
House
House Committees are expected to markup their reconciliation bills the week of September 6 and 13.
Energy & Commerce Committee
TBD
Hearing on the Future of Biomedicine: Translating Biomedical Research into Personalized Health Care
Senate
None of note.
OTHER HEALTH POLICY NEWS
On August 31, the Federation of American Hospitals sent a letter to Congressional leaders urging them to delay the statutory Pay-As-You-Go (PAYGO) provision that would trigger a 4% cut in Medicare spending and called for Congress to address PAYGO as a component of extending government funding set to expire on September 30, 2021.
On September 1, the District Court for the District of Columbia ruled against 48 hospitals that brought a lawsuit against HHS’ disproportionate share hospital overpayment changes. The judge upheld HHS' DSH calculations and methodology for uncompensated care payments.
On September 1, the U.S. Bankruptcy Court approved the Purdue Pharma settlement with some states and local governments over their participation in the opioid crisis. Connecticut and Washington State said they intend to pursue an appeal of the ruling.
On September 2, the American Academy of Actuaries released an annual report predicting that 2022 individual and small group health insurance premiums will not be significantly impacted by COVID-19 uncertainty because there is more information available regarding how COVID-19 has affected and could continue to affect health care spending. However, according to the report, some uncertainties remain regarding how the potential ending of the public health emergency and the American Rescue Plan Act enhanced premium subsidies will affect plan enrollment and spending.
On September 2-3, the Medicare Payment Advisory Commission (MedPAC) held its September meeting. The meeting included sessions discussing: