Apr 20, 2015

Washington Healthcare Update

This Week: Energy and Commerce Health Subcommittee Explores Post-Acute Bundling…CMS Releases First-ever Hospital Compare Star Ratings…Fiscal Year 2016 Proposed Inpatient and Long-term Care Hospital Policy and Payment Changes

1. Congress

House of Representatives


2. Administration

3. State Activities

4. Regulations Open for Comment

5. Reports

1. Congress


Energy and Commerce Health Subcommittee Explores Post-Acute Bundling

On April 16, the Energy and Commerce Health Subcommittee held a hearing entitled “Medicare Post-Acute Care Delivery and Options to Improve It.” The hearing was intended to give members of the subcommittee an opportunity to explore the current state of Medicare’s post-acute care (PAC) system and discuss opportunities to improve the delivery of, and access to, these services for our seniors. In addition, the hearing provided an opportunity for witnesses to offer testimony regarding H.R. 1458, the “Bundling and Coordinating Post-Acute Care Act of 2015” (BACPAC), legislation introduced in March by Rep. David McKinley (R-WV), Rep. Jerry McNerney (D-CA) and Rep. Tom Price (R-GA), to reform and improve the PAC system for our nation’s seniors. BACPAC would bundle PAC payments, while preserving the ability of patients, with the guidance of their physicians, to select their preferred providers of PAC services.


Panel 1

Mark E. Miller, Ph.D.
Executive Director
Medicare Payment Advisory Commission

Panel 2

Steven Landers, M.D., M.P.H.
President and CEO
Visiting Nurse Association Health Group

Samuel Hammerman, M.D., M.M.M., F.C.C.P.
Chief Medical Officer
LTACH Hospital Division
Select Medical Corporation

Melissa Morley, Ph.D.
Program Manager
Health Care Financing and Payment
RTI International

Leonard Russ
Principal Partner
Bayberry Health Care
Chairman of American Health Care Association

For more information, or to view the hearing, please visit

House W&M Health Subcommittee Holds Hearing on ACA Individual and Employer Mandates

On April 14, the House Ways and Means Subcommittee on Health held a hearing on the individual mandate and employer mandates and associated penalties in the President’s health care law. Members were given the opportunity to ask questions one year after the end of the Affordable Care Act’s (ACA) first open season. The hearing took place immediately following a brief subcommittee organizational meeting in Room B-318 of the Rayburn House Office Building, beginning at 10:00 a.m.

Witness List

Douglas Holtz-Eakin
President, American Action Forum

Scott Womack
President, Womack Restaurants

Sabrina Corlette
Faculty, Georgetown University

For more information or to view the hearing, please visit

Upcoming: Energy and Commerce Oversight Hearing on Opioid Abuse

The Energy and Commerce Subcommittee on Oversight and Investigations will hold a hearing on Thursday, April 23, 2015, at 10:15 a.m. in 2322 Rayburn House Office Building. The hearing is entitled “Combatting the Opioid Abuse Epidemic: Professional and Academic Perspectives.” The hearing continues the subcommittee’s review of the growing and complex threat of prescription drug and heroin abuse. Subcommittee members will hear testimony from academics and other experts about treatment options currently available and best practices for those suffering from addiction and abuse. The subcommittee began its review of this threat last year, and last month the subcommittee held a hearing to understand the challenges of this problem at the state and local level .


Robert L. DuPont, M.D.
Institute For Behavior and Health

Marvin D. Seppala, M.D.
Chief Medical Officer
Hazelden Betty Ford Foundation

Laurence M. Westreich, M.D.
American Academy of Addiction Psychiatry

Anna Lembke, M.D.
Assistant Professor of Psychiatry and Behavioral Sciences
Stanford University Medical Center Psychiatry Department

Adam Bisaga, M.D.
Columbia University Medical Center
NYS Psychiatric Institute

Patrice Harris, M.D.
American Medical Association

For more information, or to view the hearing, please visit


Senate Approves, President Enacts Bipartisan Medicare Physician Payment Fix

On April 14, the Senate passed long-awaited legislation to permanently repeal the flawed sustainable growth rate (SGR) formula used to calculate Medicare physician payments by a vote of 92-8. The repeal comes after 17 temporary patches were enacted over roughly a decade to avert the threat of steep payment cuts. Six amendments were offered, but none were adopted. Some Republicans were concerned that the estimated $141 billion cost of the repeal package was not fully offset, while Democrats had pushed for a four-year extension of the Children’s Health Insurance Program (CHIP), though ultimately the need for a permanent “doc fix” allowed lawmakers to overcome disagreements and agree to the package that had previously passed the House by a vote of 392-37. President Obama signed the bill into law on April 16. Despite the broad bipartisan support, the CMS office of the Actuary has issued a report warning that, while the bill, H.R. 2, avoids the significant short-range physician payment issues resulting from the current SGR system approach, it nevertheless raises important long-range concerns that would almost certainly need to be addressed by future legislation.

Upcoming: Senate Commerce Committee to Host Hearing on Expanding Progress on Telehealth

Sen. Roger Wicker (R-MS), chairman of the Commerce, Science, and Transportation Subcommittee on Communications, Technology, Innovation, and the Internet, will convene a hearing on Tuesday, April 21, 2015, at 10:00 a.m., titled “Advancing Telehealth Through Connectivity.” The hearing will examine the progress made by the private sector and government entities to expand the benefits of telehealth nationwide, particularly in rural areas. The meeting will also explore the connectivity challenges facing many health care providers and patients attempting to take advantage of innovative telehealth applications.

Witness List

Dr. Kristi Henderson
Chief Telehealth and Innovation Officer
University of Mississippi Medical Center

Mr. Jonathan D. Linkous
Chief Executive Officer
American Telemedicine Association

Dr. M. Chris Gibbons
Distinguished Scholar in Residence
Connect2HealthFCC Task Force
Federal Communications Commission

Mr. Todd Rytting
Chief Technology Officer
Panasonic Corporation of North America

For more information or to view the hearing, please visit

Upcoming: Senate Finance Health Subcommittee to Hold Hearing on Impacts of Medical Device Tax

Chaired by Sen. Pat Toomey (R-PA), the Senate Finance Committee Subcommittee on Health will hold a hearing April 23 entitled “A Fresh Look at the Impact of the Medical Device Tax on Jobs, Innovation, and Patients.” Members will hear testimony on the economic and health outcome effects of the 2.3 percent medical device excise tax, a key funding mechanism of the Affordable Care Act (ACA). As it stands, Full Committee Chairman Orrin Hatch’s (R-UT) proposal to repeal the medical device tax has 34 co-sponsors, five of whom are Democrats. A competing Democratic proposal in the Senate to repeal the tax and pay for it by closing tax loopholes has no GOP co-sponsors.

A witness list had not been posted at time of print. For more information or to view the hearing, please visit

HHS-OIG Accepts Request to Investigate Generic Drug Pricing

At the urging of Sen. Bernie Sanders (I-VT) and Rep. Elijah Cummings (D-MD), the Department of Health and Human Services inspector general has agreed to investigate how sudden price hikes by generic drugmakers are driving up the cost of taxpayer-supported health care. As part of their own congressional investigation, Sanders and Cummings asked generic drugmakers to turn over records on prices. The companies refused to provide meaningful records. Federal law, however, requires pharmaceutical firms to provide price data to HHS, so Sanders and Cummings formally requested the investigation by the department’s inspector general. According to HHS-OIG, the investigation will examine quarterly average manufacturer prices (AMP) reported under Medicaid drug rebate program from 2005 through 2014, and determine the extent to which the quarterly AMPs exceeded the specified inflation factor. More information can be found at

2. Administration

CMS to Award $201 Million over Three Years in Navigator Grants

The Centers for Medicare & Medicaid Services (CMS) announced April 15 the availability of funding to support navigators in Federally-facilitated Marketplaces (FFM), including State Partnership Marketplaces. Consumers shopping for and enrolling in coverage through the federal exchanges can get local help from Navigators, who aim to provide objective information about health coverage to help consumers choose a health plan in the Marketplaces or in public programs including Medicaid and the Children’s Health Insurance Program. Grantees will be selected for a three-year project period, and a total of up to $67 million is available for the first year of the award. “Navigators play a vital role in helping Americans enroll in coverage through the Marketplaces and assessing if they qualify for any insurance affordability programs. Navigators have been an important resource for the millions of Americans who enrolled in coverage over the past two years. This funding announcement ensures this important work will continue over the next three years in states with a FFM, including during Marketplace open enrollment periods,” said CMS Acting Administrator Andy Slavitt. The funding opportunity announcement is open to eligible individuals, as well as private and public entities, applying to serve as Navigators in states with an FFM. The multi-year grant award will be funded in 12-month increments with continued funding contingent on grantees’ continuing to meet all Navigator program requirements and on funding availability. HHS said organizations wanting to apply for the grants must submit a letter of intent by June 3 and an application by June 15. The grants are slated to be awarded on Sept. 2.

HHS: $1 Million in New Grants Available to Help Improve Health IT Sharing

On April 16, National Coordinator for Health Information Technology Karen B. DeSalvo announced the availability of $1 million in grant funds to support community projects for the Community Interoperability Health Information Exchange (HIE) Program . The Community Interoperability and HIE program will provide funds to up to 10 community organizations, state or local government agencies, or other community groups. Final awardees will demonstrate the use of health IT to the wide range of health providers, including those that are not eligible under the Medicare and Medicaid Electronic Health Record Incentive Programs. The awards aim to help unlock health information and better integrate community resources advancing better care and healthier communities. “The new Community Interoperability and HIE program will fund local efforts that will leverage health IT in support of a more comprehensive digital data picture of health for people and their communities,” said Dr. DeSalvo in a statement. The submission deadline for the applications is June 15, 2015, and the non-mandatory deadline to submit intent to apply notices is May 15.

The submission application is available at

FDA Releases Guidance on Striking Median between Premarket and Postmarket Data Collection for Devices Subject to Premarket Approval

On April 13, the Food and Drug Administration (FDA) issued final guidance that clarifies the agency’s current policy on balancing premarket and postmarket data collection during FDA review of premarket approval applications (PMAs). More specifically, the guidance outlines how FDA considers the role of postmarket information in determining the extent of data that should be collected in the premarket setting to support premarket approval while still meeting the statutory standard of reasonable assurance of safety and effectiveness. The guidance suggests the agency may be willing to rely more heavily on postmarket data in certain cases, such as when the device is part of a “mature technology” in which FDA has a lot of experience with the benefits and when risks of a certain device type, or there is an urgent public health need. The guidance stresses that FDA must strike the right balance between timely patient access to new technology and not undermining patient safety in decisions on whether to rely more heavily on postmarket data. Section 513(a)(3)(C) of the Federal Food, Drug, and Cosmetic Act specifically requires FDA to consider the use of postmarket controls in lieu of collecting and reviewing all effectiveness data prior to PMA approval.

CMS Releases First-ever Hospital Compare Star Ratings

On April 16, CMS for the first time introduced star ratings on Hospital Compare, the agency’s public information website, to make it easier for consumers to choose a hospital and understand the quality of care each delivers. The announcement builds on a larger effort across HHS to build a health care system that delivers better care, spends health care dollars more wisely and results in healthier people. The Hospital Compare star ratings relate to patients’ experience of care at almost 3,500 Medicare-certified acute care hospitals. The ratings are based on data from the Hospital Consumer Assessment of Healthcare Providers and Systems Survey (HCAHPS) measures that are included in Hospital Compare. HCAHPS has been in use since 2006 to measure patients’ perspectives of hospital care, and includes topics like:

  • How well nurses and doctors communicated with patients
  • How responsive hospital staff were to patient needs
  • How clean and quiet hospital environments were
  • How well patients were prepared for post-hospital settings

For more information, please visit

Wachino Named as Permanent Chief Medicaid Official

On April 17, Vikki Wachino was tapped to be the top Medicaid official at CMS, Acting Administrator Andy Slavitt wrote in an email to staff. Wachino has been acting director of CMS’ Center for Medicaid and CHIP Services since late December, following the announcement that Cindy Mann would depart the agency in January. In prior and current roles at CMS, Wachino has overseen implementation of major pieces of the ACA and worked with states on Medicaid and CHIP.

3. State Activities

Florida Files Lawsuit Against CMS over Block on LIP Funding

On April 16, Florida Gov. Rick Scott (R) announced that his administration would file a lawsuit against the federal government if CMS continues to withhold more than $1.3 billion in Low Income Pool funding should the state not opt to expand Medicaid. “It is appalling that President Obama would cut off federal health care dollars to Florida in an effort to force our state further into Obamacare,” Gov. Scott said, citing a 2012 Supreme Court ruling that said the federal government couldn’t put a “gun to the head” of states to force them to expand Medicaid under the health care law. The decision follows a CMS letter sent to his Administration on April 15 that set a clear impasse, with the agency specifically saying that LIP funding is connected to a state’s decision not to expand Medicaid. The surprise announcement by the Scott Administration trails weeks of escalating tensions between state and administration officials over Florida’s opposition to Medicaid expansion. LIP funds may be used for health care expenditures (medical care costs or premiums) that would be within the definition of medical assistance. These health care expenditures may be incurred by the state, hospitals, clinics or other provider types for uncompensated costs of medical services for the uninsured. With LIP funds expected to run out by June 30, over 800,000 low-income Floridians may not have access to health care should the federal funding cease.

4. Regulations Open for Comment

Fiscal Year 2016 Proposed Inpatient and Long-term Care Hospital Policy and Payment Changes

On April 17, 2015, CMS issued a proposed rule to update fiscal year (FY) 2016 Medicare payment policies and rates under the Inpatient Prospective Payment System (IPPS) and the Long-Term Care Hospital (LTCH) Prospective Payment System (PPS). The proposed rule, which would apply to approximately 3,400 acute care hospitals and approximately 435 LTCHs, would affect discharges occurring on or after Oct. 1, 2015. The IPPS pays hospitals for services provided to Medicare beneficiaries using a national base payment rate, adjusted for a number of factors that affect hospitals’ costs, including the patient’s condition and market conditions in the hospital’s geographic area.

The rule proposes policies that continue a commitment to increasingly shift Medicare payments from volume to value. CMS pays acute care hospitals (with a few exceptions specified in the law) for inpatient stays under the IPPS and long-term care hospitals under the LTCH PPS. Under these two payment systems, CMS generally sets payment rates prospectively for inpatient stays based on the patient’s diagnosis and severity of illness. A hospital receives a single payment for the case based on the payment classification — MS-DRGs under the IPPS and MS-LTC-DRGs under the LTCH PPS — assigned at discharge.

By law, CMS is required to update payment rates for IPPS hospitals annually, and to account for changes in the costs of goods and services used by these hospitals in treating Medicare patients, as well as for other factors. This is known as the hospital “market basket.” LTCHs are paid according to a separate market basket based on LTCH-specific goods and services. CMS will accept comments on the proposed rule until June 16, 2015.

Proposed FY 2016 Payment and Policy Changes for Medicare Skilled Nursing Facilities (SNF)

On April 15, 2015, CMS issued a proposed rule [CMS-1622-P] outlining proposed Fiscal Year (FY) 2016 Medicare payment rates for skilled nursing facilities (SNFs). This proposed rule would update the payment rates used under the prospective payment system (PPS) for skilled nursing facilities (SNFs) for fiscal year (FY) 2016. In addition, it includes a proposal to specify a SNF all-cause all-condition hospital readmission measure, as well as a proposal to adopt that measure for a new SNF Value-Based Purchasing (VBP) Program and a discussion of SNF VBP Program policies being considered for future rulemaking to promote higher quality and more efficient health care for Medicare beneficiaries. Additionally, this proposed rule would implement a new quality reporting program for SNFs as specified in the Improving Medicare Post-Acute Care Transformation Act of 2014 (IMPACT Act). It also would amend the requirements that a long-term care (LTC) facility must meet to qualify to participate as a skilled nursing facility (SNF) in the Medicare program, or a nursing facility (NF) in the Medicaid program. These requirements implement the provision in the Affordable Care Act regarding the submission of staffing information based on payroll data. To be assured consideration, comments must be received no later than 5 p.m. on June 19, 2015.

CMS Proposes Mental Health Parity for Medicaid and CHIP in New Rule

The Centers for Medicare & Medicaid Services (CMS) announced April 6 a new proposed rule to align mental health and substance use disorder benefits for low-income Americans with benefits required of private health plans and insurance. Specifically, the proposal applies certain provisions of the Mental Health Parity and Addiction Equity Act of 2008 to Medicaid and the Children’s Health Insurance Program (CHIP) by mandating that mental health and substance use disorder benefits are no more restrictive than medical and surgical services. As it is currently written, the proposed rule ensures that all beneficiaries who receive services through managed care organizations or under alternative benefit plans have access to mental health and substance use disorder benefits regardless of whether services are provided through the managed care organization or another service delivery system, and the full scope of the proposed rule applies to CHIP, regardless of whether care is provided through fee-for-service or managed care. Currently, states have flexibility to provide services through a managed care delivery mechanism using entities other than Medicaid managed care organizations, such as prepaid inpatient health plans or prepaid ambulatory health plans; in the new rule, states will be required to include contract provisions requiring compliance with parity requirements in all applicable contracts for these Medicaid managed care arrangements. The proposed rule was published in the Federal Register on April 10 with comments due to the agency by June 9, 2015.

FDA Assessing the Center of Drug Evaluation and Research’s Safety-Related Regulatory Science Needs and Identifying Priorities

On March 19, the Food and Drug Administration (FDA) announced the availability of a report entitled "Assessing CDER’s Drug Safety-Related Regulatory Science Needs and Identifying Priorities." This report identifies drug safety-related regulatory science needs and priorities related to the mission of FDA’s Center for Drug Evaluation and Research (CDER) that would benefit from external collaborations and resources. FDA hopes to foster collaborations with external partners and stakeholders to help address these needs and priorities. This notice asks stakeholders conducting research related to these needs to describe that research and indicate their interest in collaborating with FDA to address safety-related research priorities. Since publication of the 2011 "Identifying CDER’s Science and Research Needs" report, FDA has been engaged in efforts to further assess and prioritize the needs articulated therein. As part of these efforts, CDER’s Safety Research Interest Group (SRIG), a subcommittee of the Science Prioritization and Review Committee, assessed CDER’s overall drug safety-related regulatory science needs in view of FDA’s ongoing research efforts and highlighted areas that would benefit from additional resources and collaboration. Public comments will be accepted at any time. However, the public is encouraged to submit comments by May 18, 2015, to ensure FDA consideration.

National Coverage Determinations Proposed for Removal

On Aug. 7, 2013, the Centers for Medicare & Medicaid Services (CMS) published a Federal Register notice (78 FR 48164-69), updating the process used for opening, deciding or reconsidering national coverage determinations (NCDs) under the Social Security Act (the Act). The notice replaced the Sept. 26, 2003, Federal Register notice (68 FR 55634) and further outlined an expedited administrative process, using specific criteria, to remove certain NCDs older than 10 years since their most recent review. On March 18, CMS announced its list of NCDs proposed for removal, along with the relevant portion of the Federal Register notice containing the CMS criteria. CMS is soliciting public comment through April 17 on whether any or all of these NCDs should be removed or retained. CMS expects to publish a finalized list by fall 2015. Local Medicare Administrative Contractors (MACs) will be able to determine coverage for items and services that were previously determined by removed NCDs. View the proposed rule:

HHS Releases Proposed Rules on EHR Incentive Programs and Health IT Certification Criteria

The U.S. Department of Health and Human Services (HHS), Centers for Medicare & Medicaid Services (CMS) and Office of the National Coordinator for Health Information Technology (ONC) announced March 20 the release of the Stage 3 notice of proposed rulemaking for the Medicare and Medicaid Electronic Health Records (EHRs) Incentive Programs and 2015 Edition Health IT Certification Criteria to improve the way electronic health information is shared and ultimately improve the way care is delivered and experienced. The proposed rules aim to give providers additional flexibility, make the program simpler, drive interoperability among electronic health records and increase the focus on patient outcomes to improve care.

Specifically, the Meaningful Use Stage 3 proposed rule issued by CMS specifies new criteria that eligible professionals, eligible hospitals and critical access hospitals must meet to qualify for Medicaid EHR incentive payments; the rule also proposes criteria that providers must meet to avoid Medicare payment adjustments (Medicaid has no payment adjustments) based on program performance beginning in payment year 2018. Moreover, the 2015 Edition Health IT Certification Criteria proposed rule aligns with the path toward interoperability — the secure, efficient and effective sharing and use of health information — identified in ONC’s draft shared Nationwide Interoperability Roadmap. The proposed rule also builds on past editions of adopted health IT certification criteria, and includes new and updated IT functionality and provisions that support the EHR Incentive Programs’ care improvement, cost reduction and patient safety across the health system.

Under the Health Information Technology for Economic and Clinical Health Act, doctors, health care professionals and hospitals, including critical access hospitals, can qualify for Medicare and Medicaid incentive payments when they adopt and meaningfully use health IT technology certified by ONC. The Stage 3 proposed rule may be viewed here, and the comment period ends on May 29, 2015. The 2015 Edition proposed rule may be viewed here and the comment period ends on May 29, 2015. The Draft 2015 Edition Certification Test Procedures may be viewed at, and the comment period ends on June 30, 2015.

Use of an Electronic Informed Consent in Clinical Investigations: Questions and Answers; Draft Guidance for Industry, Clinical Investigators and Institutional Review Boards

The Food and Drug Administration (FDA or the Agency) is announcing the availability of draft guidance for industry, clinical investigators and institutional review boards, entitled “Use of Electronic Informed Consent in Clinical Investigations: Questions and Answers.” The guidance provides recommendations for clinical investigators, sponsors and institutional review boards (IRBs) on the use of electronic media and processes to obtain informed consent for FDA-regulated clinical investigations of medical products, including human drug and biological products, medical devices and combinations thereof. Although public comments will be accepted any time, to ensure that the Agency considers your comment on this draft guidance before it begins work on the final version of the guidance, submit either electronic or written comments on the draft guidance by May 8, 2015.

FDA: Reprocessing Medical Devices in Health Care Settings: Validation Methods and Labeling

On March 12, FDA announced new actions to enhance the safety of reusable medical devices and address the possible spread of infectious agents between uses. The new recommendations are outlined in a final industry guidance aimed at helping device manufacturers develop safer reusable devices, especially those devices that pose a greater risk of infection. Medical devices intended for repeated use are commonplace in health care settings. They are typically made of durable substances that can withstand reprocessing, a multi-step process designed to remove soil and contaminants by cleaning and to inactivate microorganisms by disinfection or sterilization. While the majority of reusable devices are successfully reprocessed in health care settings, the complex design of some devices makes it harder to remove contaminants. FDA’s guidance document, titled “Reprocessing Medical Devices in Health Care Settings: Validation Methods and Labeling ,” includes recommendations medical device manufacturers should follow pre-market and post-market for the safe and effective use of reprocessed devices. A device manufacturer’s reprocessing instructions are critical to protect patients against the spread of infections. As part of its regulatory review for reusable medical devices, the FDA reviews the manufacturer’s reprocessing instructions to determine whether they are appropriate and able to be understood and followed by end users. The guidance lists six criteria that should be addressed in the instructions for use with every reusable device to ensure users understand and correctly follow the reprocessing instructions.

Compounding of Human Drug Products Under the Federal Food, Drug, and Cosmetic Act; Establishment of a Public Docket

On March 9, FDA announced it is establishing a public docket to receive information, recommendations and comments on matters related to the Agency’s regulation of compounding of human drug products under sections 503A and 503B of the Federal Food, Drug, and Cosmetic Act (FD&C Act). Section 503A of the FD&C Act describes the conditions that must be satisfied for human drug products compounded by a licensed pharmacist or licensed physician to be exempt from certain sections of the FD&C Act. Previously, the conditions of section 503A of the FD&C Act also included restrictions on the advertising or promotion of the compounding of any particular drug, class of drug or type of drug and the solicitation of prescriptions for compounded drugs. These provisions were challenged in court and held unconstitutional by the U.S. Supreme Court in 2002.

On Nov. 27, 2013, President Obama signed the Drug Quality and Security Act (DQSA), which contains important provisions relating to the oversight of human drug compounding. This new law removes from section 503A of the FD&C Act the provisions that had been held unconstitutional by the U.S. Supreme Court in 2002. By removing these provisions, the new law clarifies that section 503A of the FD&C Act applies nationwide. In addition, the DQSA adds a new section, 503B, to the FD&C Act that creates a new category of “outsourcing facilities.” Outsourcing facilities, as defined in section 503B of the FD&C Act, are facilities that meet certain conditions described in section 503B, including registration with FDA as an outsourcing facility. This docket is intended for general comments related to human drug compounding that are not specific to documents or issues that are the subject of other dockets. Comments may be submitted to this docket at any time.

FDA Solicits Comments on New Methodologies for Generic Drug Clinical Studies

In a notice released March 5 by the Federal Register, the Food and Drug Administration (FDA) is seeking feedback from stakeholders on possible new methodologies for generic drug clinical studies and ways to demonstrate bioequivalence as part of its regulatory science priorities for 2016 under Generic Drug User Fee Amendments (GDUFA). FDA noted it will take feedback from stakeholders into account when creating next year’s regulatory science plan for generic drugs. A public hearing has been scheduled for June 5, where FDA plans to hear from stakeholders on six specific areas including scientific or technical advancements that would help that currently limit generics’ availability, innovative approaches to preapproval development of generic drugs, advancements in scientific approaches to evaluate therapeutic equivalence of generic drugs through later stages of their lifecycle. The agency’s efforts come as House and Senate lawmakers are also looking at ways to revamp clinical trial design, though up to now they haven’t focused on generic drug-specific issues, and identification of high-impact public health issues involving generic drugs, among others. The notice comes as the House of Representatives 21st Century Cures discussion legislative draft also seeks to revamp clinical trials by allowing trial sponsors to propose incorporating adaptive trial designs for alternative statistical methods into proposed clinical trials and streamlining the institutional review board.

FDA Reopens Comment Period for Generic Drug Labeling Rule

In an announcement Feb. 17, the Food and Drug Administration (FDA) revealed that it has formally re-opened the comment period for a controversial generic drug labeling proposed rule and will hold a public meeting next month to address concerns with the rule and possible alternatives. The rule, which FDA proposed in 2013, would allow generic drugmakers to unilaterally update safety information and would require generic drugmakers to modify their labels independently of their brand-name counterparts, something that only brand-name drugmakers can currently do before receiving agency permission. The FDA proposed the rule in response to a 2011 U.S. Supreme Court decision that federal law does not permit generic drugmakers to make such changes independently and, therefore, they should not be held accountable for a failure to warn against a risk. Stakeholders will have until April 27 to comment on the proposed rule; the agency’s public hearing to receive more input from stakeholders will be held on March 27 from 8 a.m. to 5 p.m. at FDA’s White Oak campus.

FDA Releases Five Draft Guidance Documents on Drug Compounding

On Feb. 13, U.S. Food and Drug Administration (FDA) issued five draft guidance documents related to drug compounding and repackaging that will help entities comply with important public health provisions; guidance will be applicable to pharmacies, federal facilities, outsourcing facilities and physicians and comes as an outcrop of the Drug Quality and Security Act (DQSA), enacted by Congress in November 2013, in response to a deadly fungal meningitis outbreak that was linked to contaminated sterile compounded drug products. Specifically, the documents include potential direction on outsourcing facility registration, outsourcing facility adverse event reporting, drug repackaging, mixing, diluting and repackaging biological products, and a draft Memorandum of Understanding (MOU) with the states. The draft guidance documents are available for public comment until May 14, while draft comment for the draft MOU is open until June 13.

5. Reports

Office of the National Coordinator for Health Information Technology (ONC): Report on Health Information Blocking

On April 10, the Office of the National Coordinator for Health Information Technology issued a report on the extent of health information blocking and a comprehensive strategy to address it. The report provides criteria for identifying such conduct and distinguishing it from other barriers to interoperability and health information exchange. It also examines the nature and extent of information blocking, based on available evidence and the accumulated industry knowledge and experience of ONC. According to the report, while the evidence is in some respects limited, there is little doubt that information blocking is occurring and that it is interfering with the exchange of electronic health information. ONC believes that information blocking is best addressed through a combination of targeted actions aimed at deterring and remedying information blocking, and broader strategies and approaches that engage the larger context in which information blocking occurs. Information blocking occurs when persons or entities knowingly and unreasonably interfere with the exchange or use of electronic health information. This report focuses on potential information blocking by health care providers and health IT developers, including vendors of EHR technology.

HHS Report: Medicare Spending Was $316 Billion Lower than Average Growth Rate Spending Between 2009 and 2013

In a report released April 15 by the Department of Health and Human Services Assistant Secretary for Planning and Evaluation (ASPE), the agency found that between 2009 and 2013 Medicare spending was $316 billion lower than expected had average growth rates from 2000 to 2008 continued. “This is a good result for the taxpayer and our economy,” HHS Secretary Sylvia Burwell said. “We are also spending our dollars more wisely and improving the quality of care for Medicare beneficiaries. Using tools in the Affordable Care Act, we are changing the nation’s health care delivery system to one that achieves better care, smarter spending, and healthier people.” Moreover, the report notes that from 2009 to 2012, Medicare spending per beneficiary (across Traditional Medicare and Medicare Advantage) grew at an average rate of 1.8 percent annually or less than 1/3 its rate of growth during 2000-2008. There was essentially no growth in Medicare spending on a per beneficiary basis in 2013. Specific policies the report mentions that have contributed to the decline in Medicare spending per beneficiary include tying Medicare Advantage (MA) payment benchmarks to Traditional Medicare, implementing a wide range of delivery system reforms to improve quality and lower costs (such as fostering the growth of Accountable Care Organizations and testing bundled-payment arrangements) and consolidating payment enforcement efforts through expansion of the scope of program integrity activities and enhancing provider screening, among others.

CDC/USDA Report Finds Increase in E-Cigarette Use Among Teens

The Centers for Disease Control (CDC) and U.S. Food and Drug Administration’s Center for Tobacco Products (CTP) released a joint report April 16 that found that current e-cigarette use among middle and high school students tripled from 2013 to 2014. Findings from the 2014 National Youth Tobacco Survey show that current e-cigarette use (use on at least one day in the past 30 days) among high school students increased from 4.5 percent in 2013 to 13.4 percent in 2014, rising from approximately 660,000 to 2 million students. Among middle school students, current e-cigarette use more than tripled, from 1.1 percent in 2013 to 3.9 percent in 2014 — an increase from approximately 120,000 to 450,000 students. This is the first time since the survey started collecting data on e-cigarettes in 2011 that current e-cigarette use has surpassed current use of every other tobacco product overall, including conventional cigarettes. “We want parents to know that nicotine is dangerous for kids at any age, whether it’s an e-cigarette, hookah, cigarette or cigar,” said CDC Director Tom Frieden, M.D., M.P.H. “Adolescence is a critical time for brain development. Nicotine exposure at a young age may cause lasting harm to brain development, promote addiction, and lead to sustained tobacco use.” As it stands, FDA is currently developing a rule to bring additional tobacco products such as e-cigarettes, hookahs and some or all cigars subject to FDA’s tobacco control authority.

If you have any questions, contact the following individuals at McGuireWoods Consulting:

Stephanie Kennan, Senior Vice President
Charlyn Iovino, Vice President
Brian Looser, Vice President
Amanda Anderson, Research Assistant

Founded in 1998, McGuireWoods Consulting LLC (MWC) is a full-service public affairs firm offering state and federal government relations, national/multistate strategies, infrastructure and economic development, strategic communications and grassroots issue management services. McGuireWoods Consulting is a subsidiary of the McGuireWoods LLP law firm and in 2010 was ranked in the Top 20 of The National Law Journal's "The Influence 50," an annual report of the top public affairs firms in Washington, D.C.

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