Health Care Watch: July 8, 2023
The following Federal Health Policy (FHP) Strategies Weekly Health Care Watch provides a summary of legislative and regulatory health care activities from July 3 – July 8. 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 July 5, Energy and Commerce Chair Cathy McMorris Rodgers called for the Centers for Medicare & Medicaid Services (CMS) to expand coverage of Alzheimer’s therapies ahead of the Food and Drug Administration’s action to grant traditional approval to Leqembi on July 6.
The House will return from its July 4 recess on July 11.
Senate
On July 3, HELP Committee Chairman Bernie Sanders (D-VT) and Ranking Member Bill Cassidy (R-LA), along with Committee members Bob Casey (D-PA) and Mitt Romney (R-UT), released a discussion draft of legislation to reauthorize the Pandemic All-Hazards Preparedness Act (PAHPA). Feedback on the discussion draft, which includes certain policies not subject to the staff agreement on drug pricing, is requested by Monday, July 10 at 10:00 AM and can be sent to PAHPA2023Comments@help.senate.gov. The Chairman’s press release on the discussion draft and feedback process is available here.
The Senate will return from its July 4 recess on July 10.
REGULATORY UPDATE
On July 5, the National Institutes of Health (NIH) announced that the first clinical trial of a three-month tuberculosis (TB) treatment regimen is closing enrollment because of a high rate of unfavorable outcomes with the investigational course of treatment. The CLO-FAST trial sought to evaluate the safety and efficacy of a three-month clofazimine- and high-dose rifapentine-containing regimen. An interim data analysis showed that participants taking the investigational regimen experienced ongoing or recurring TB at rates above thresholds set in the study protocol.
On July 6, the U.S. Food & Drug Administration (FDA) converted Leqembi, indicated to treat adult patients with Alzheimer’s disease, to traditional approval following a determination that a confirmatory trial verified a clinical benefit. Leqembi was previously approved in January under the FDA’s accelerated approval pathway. Leqembi is the first amyloid beta-directed antibody to be converted from an accelerated approval to a traditional approval for the treatment of Alzheimer’s disease. The drug works by reducing amyloid plaques that form in the brain. Notably, with traditional FDA approval, Medicare will begin to cover the drug more broadly. CMS announced Medicare’s expanded coverage of Leqembi the same day which follows an earlier National Coverage Decision (NCD) tied to traditional approval by the FDA.
On July 6, the National Association for Home Care and Hospice (NAHC) filed a lawsuit against CMS and the and the United States Department of Health & Human Services (HHS) challenging the validity of a change in Medicare home health payment that reduced rates by 3.925% in 2023 with significant additional cuts expected over the next several years. CMS has proposed an additional 5.653% permanent rate cut to begin in 2024 based on the same challenged payment methodology.
On July 6, the CY 2024 Revisions to Payment Policies under the Physician Fee Schedule and Other Revisions to Medicare Proposed Rule concluded review at the Office of Management and Budget (OMB). The rule is expected to be issued to the public during the week of July 9th.
On July 7, HHS, the Department of Labor, and the Department of the Treasury released a joint notice of proposed rulemaking (NPRM) that proposes to modify the definition of short-term, limited-duration insurance (STLDI) and modify the conditions for hospital indemnity or other fixed indemnity insurance to be considered an “excepted benefit” which is an alternative to a traditional health insurance plan under the Affordable Care Act. The NPRM also solicits comments regarding specified disease excepted benefits coverage and comments regarding level-funded plan arrangements. The NPRM further includes a proposal from the Department of the Treasury and the Internal Revenue Service that would clarify the tax treatment of certain benefit payments in fixed amounts received under employer-provided accident and health plans.
On July 7, in light of the Supreme Court’s decision in American Hospital Association v. Becerra, CMS issued a proposed rule outlining the proposed remedy for the 340B-acquired drug payment policy for calendar years 2018-2022. CMS is publishing this proposed rule to remedy the payment rates the Court held were invalid. CMS proposes to make a one-time lump-sum payment to each 340B-covered entity hospital that was paid less due to the now-invalidated policy. The proposed rule contains the calculations of the amounts owed to each of the approximately 1,600 affected 340B covered entity hospitals. As a result of budget neutrality provisions, CMS is also proposing to reduce future non-drug item and service payments by adjusting the OPPS conversion factor by minus 0.5% for a period of 16 years.
On July 7, HHS released a new report showing that nearly 19 million Part D enrollees are projected to save $400 per year on prescription drugs when the $2,000 out-of-pocket cap and other Inflation Reduction Act (IRA) provisions go into effect in 2025. Among those enrollees, 1.9 million with the highest drug costs will save an average of $2,500 per year starting in 2025. Overall, the report estimates that the IRA’s Part D provisions will reduce enrollee out-of-pocket spending by about $7.4 billion annually. The report also breaks the data down by state.
On July 7, CMS released new surprise billing guidance to end the “in-network” designation and patients being charged for facility fees outside of hospitals (such as a doctor’s offices).
On July 7, the Consumer Financial Protection Bureau, HHS and Treasury Department launched an inquiry into high-cost specialty financial products, such as medical credit cards and installment loans. Providers often encourage patients to sign up for such third-party products to help pay for care, but the products can include rates and deferred interest features that lead to higher costs for patients. The RFI aims to learn more about this practice and solicits comments about potential policy actions.
WHITE HOUSE UPDATE
On July 7, the White House announced new actions that it argues will lower health care costs. The announcement included new data on expected Part D savings as a result of the IRA, as well as new actions related to short-term plans, surprise medical billing, and medical debt – as referenced above.
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 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
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
Streamlining the Medicaid, CHIP, and BHP Application, Eligibility Determination, Enrollment, and Renewal Processes (CMS-2421); Final Rule; 6/28/23
Hospital Inpatient Prospective Payment Systems for Acute Care Hospitals; the Long-Term Care Hospital Prospective Payment System; and FY 2024 Rates (CMS-1785); Final Rule; 6/29/23
FY 2024 Skilled Nursing Facility (SNFs) Prospective Payment System and Consolidated Billing and Updates to the Value-Based Purchasing and Quality Reporting Programs (CMS-1779); Final Rule; 7/3/23
FY 2024 Inpatient Rehabilitation Facility (IRF) Prospective Payment System Rate Update and Quality Reporting Program (CMS-1781); Final Rule; 7/5/23
FY 2024 Hospice Wage Index, Payment Rate Update, and Quality Reporting Requirements (CMS-1787); Final Rule; 7/5/23
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; 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
Postmarketing Approaches to Obtain Data on Under-Represented Populations in Clinical Trials (Draft Guidance); Notice; 6/29/23
CDC
Possession, Use, and Transfer of Select Agents and Toxins; Biennial Review; Proposed Rule; 6/26/23
REPORTS
HHS, Office of the Inspector General
On July 5, the HHS Office of Inspector General (OIG) issued a report entitled “Part D Plans Generally Include Drugs Commonly Used by Dual-Eligible Enrollees: 2023”. The OIG found that dual-eligible enrollees (individuals who are covered by both Medicare and Medicaid) have access to most used drugs in 2023 via their Part D plans, consistent with OIG's findings from previous years. The report notes that most of the 445 Part D plan formularies covered almost all (at least 97 percent) of the drugs most used by dual-eligible enrollees.
UPCOMING CONGRESSIONAL HEARINGS
House
Oversight and Accountability Committee
July 11; 10:00 AM; 2154 Rayburn
Investigating the Proximal Origin of a Cover Up
Energy & Commerce Committee
July 13; TBD
Markup of the Pandemic and All-Hazards Preparedness Act
Small Business Committee
July 13; 2:00 PM; 2360 Rayburn
Pandemic Fraud Accountability: Reviewing the SBA Inspector General’s COVID-19 Fraud Report
Witness: Mike Ware, Inspector General, U.S. Small Business Administration
Oversight, Investigations, and Regulations Subcommittee
July 19; 10:00 AM; 2360 Rayburn
Burdensome Red Tape: Overregulation in Health Care and the Impact on Small Businesses
Senate
HELP Committee
July 11; 10:00 AM; 430 Dirksen
Superbugs: The Impact of Antimicrobial Resistance on Modern Medicine
Appropriations Committee
July 11; 10:00AM; 106 Dirksen
Witnesses: Panel I: Griffin Rodgers, MD, Director, National Institute of Diabetes and Digestive and Kidney Diseases, National Institutes of Health; Panel II: Aaron Kowalski, CEO, JDRF; James "Jimmy Jam" Harris, Music Producer and Philanthropist; Maria Muayad, JDRF 2023 Children’s Congress Delegate; Elise Cataldo, JDRF 2023 Children’s Congress Delegate.
OTHER HEALTH POLICY NEWS
The Urban Institute released a report entitled The Medicare Advantage Quality Bonus Program (QBP): High Cost for Uncertain Gain finding that while a significant revenue source for some Medicare Advantage organizations, the QBP doesn’t translate to higher quality care for beneficiaries. The report argues for reforms to or replacement of the QBP.