Washington Healthcare Update

June 24, 2019

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This week in Washington: Senate to hold hearing on the enforcement of antitrust laws, while the House plans to cover a number of health care bills that reauthorize a variety of health programs for Americans. The House may hold markups on Medicare-related legislation soon, but they have not been announced. 

Upcoming Hearings/Markups

Congress

Hearings/Markups

House

Administration

Final Rules/Guidance

Proposed Regulations/Guidance

Courts

Other

Reports

Upcoming Hearings/Markups

[Note: The House Ways and Means Committee and the House Committee on Energy and Commerce may hold markups on Medicare-related legislation soon. However, they have not been announced.  If they are not held this week, they will be after Congress returns from its 4th of July recess.]

Tuesday, June 25, 2019

House Committee on Energy and Commerce: “Reauthorizing Vital Health Programs for American Families”
The Health Subcommittee of the Committee on Energy and Commerce will hold a legislative hearing on health care bills that reauthorize a variety of health programs for Americans

  • H.R. 776, the “Emergency Medical Services for Children Program Reauthorization Act of 2019” reauthorizes the Emergency Medical Services for Children Program at $22.334 million dollars each year through 2024.
  • H.R. 1058, the “Autism CARES Act of 2019” reauthorizes funding for programs at the National Institutes of Health (NIH), Centers for Disease Control and Prevention (CDC) and Health Resources and Services Administration (HRSA) through 2024.
  • H.R. 2035, the “Lifespan Respite Care Reauthorization Act of 2019” reauthorizes the Lifespan Respite Care Program at $20 million in fiscal year (FY) 2020, and increases the funding level by $10 million each year thereafter through FY 2024. It would also add new reporting requirements for program grantees.
  • H.R. 2507, the “Newborn Screening Saves Lives Reauthorization Act of 2019” reauthorizes newborn screening programs for five years. The bill includes reforms to ensure that the activities of the Advisory Committee on Heritable Disorders in Newborns and Children (ACHDNC) are transparent, including requiring the creation of a publicly accessible website which details the uniform screening panel nomination process. The bill also requires the Centers for Disease Control and Prevention (CDC) to standardize data collection and reporting to track and monitor newborn screening in real time. Additionally, the bill orders a study on the modernization of newborn screening. The bill authorizes appropriations of $60.65 million per year through 2024.

Find witness testimonies and hearing updates as they become available here.

Wednesday, June 26, 2019

Senate Committee on Health, Education, Labor and Pensions (HELP): “Executive Session/Markup of S. 1199, S. 1173, S. 1895”
The Senate Committee on Health, Education, Labor and Pensions (HELP) will hold a markup on the following legislation:  

  • S. 1199, Poison Center Network Enhancement Act of 2019
  • S. 1173, Emergency Medical Services for Children Reauthorization Act of 2019
  • S. 1895, Lower Health Care Costs Act

Find markup updates as they become available here.

Tuesday, July 23, 2019

Senate Committee on the Judiciary: “Oversight of the Enforcement of the Antitrust Laws”
The Senate Committee on the Judiciary’s Subcommittee on Antitrust, Competition Policy, and Consumer Rights will hold another hearing related to antitrust laws, seeking suggestions on oversight and enforcement at the federal level.

Congress

Hearings/Markups

Senate Committee on Health, Education, Labor and Pensions (HELP): “Lower Health Care Costs Act”

Tuesday, June 18, 2019: The Senate Committee on Health, Education, Labor and Pensions (HELP) held a hearing on the Lower Health Care Costs Act, a bipartisan discussion draft largely concerning drug pricing. The committee requested comment on the draft that addresses surprise medical billing, reforms to prevent anticompetitive behavior in health care markets and a proposal to create a nationwide health care cost transparency organization. The comment period closed on June 5. Find an analysis of the discussion draft by MWC Research Associate Mariam Eatedali here. Find witness testimonies and hearing updates here.

Why this is important: While the hearing’s witnesses were highly supportive of the bill’s provisions regarding the elimination of gag clauses and the building of an all-payer claims database, they disagreed concerning how to determine what should be paid when a claim is out of network. The options discussed were: (1) in-network guarantees, which would require a provider to either join an insurance network or be paid by the hospital; (2) third-party, “baseball style” arbitration; and (3) benchmark payment setting.

Senate Special Committee on Aging: “The Complex Web of Prescription Drug Prices, Part III: Examining Agency Efforts to Further Competition and Increase Affordability

Wednesday, June 19, 2019: The Senate Aging Committee held the third hearing in its series on prescription drug prices, with witnesses testifying from the Centers for Medicare and Medicaid Services (CMS), the Food and Drug Administration (FDA) and the Department of Health and Human Services (HHS), Office of the Inspector General. Find witness testimonies and hearing updates here.

Why this is important: The committee focused on how drugs become generic and how they are discounted by rebates to patients with health insurance. 

House Committee on Oversight and Reform: “Medical Experts: Inadequate Federal Approach to Opioid Treatment and the Need to Expand Care”

The House Committee on Oversight and Reform held a hearing on solutions that address the opioid crisis and action that can be taken at the federal level. Witnesses will include a panel of medical experts. Find witness testimonies and hearing updates here.

Why this is important: The witness panel spent the hearing advocating for the committee’s Comprehensive Addiction Resources Emergency (CARE) Act. The bill, H.R. 2569, has an identical bill introduced to the Senate, S. 1365. Both bills are modeled directly on the bipartisan Ryan White Act, which Congress passed in 1990 to help state and local governments combat the HIV/AIDS epidemic and provide the resources and the comprehensive framework to begin treating the opioid crisis like a critical public health emergency.

House Committee on Energy and Commerce: “Strengthening Health Care in the U.S. Territories for Today and Into the Future”

Thursday, June 20, 2019: The House Committee on Energy and Commerce’s Health subcommittee will hold a hearing on long-term health care concerns in U.S. territories. Find witness testimonies and hearing updates here.

Why this is important: The federal funding shortfall in the U.S. territories means most of the territories are not able to provide the full range of benefits that state Medicaid programs are required to cover. Unlike in the states, where the Federal Medicaid Assistance Percentage (FMAP) is not capped, and the federal share varies based on the per capita income of residents of that state, federal funding for Medicaid in the territories is subject to a statutory cap and a fixed federal matching rate. While Congress has provided some time-limited increases to the territories’ Medicaid funding, the committee is seeking a long-term solution.

House

House Committee Leaders Warn Trump Administration to Not Adjust Poverty Overhaul

On June 21, House Democrats spoke out against the Trump administration’s plan to shift the Census Bureau’s poverty thresholds to an alternate, lower measure of inflation than the traditional Consumer Price Index. The House committee chairs warn that it could harm millions of low-income Americans and would subvert how Congress legislates around safety net programs like Medicaid. The Members wrote to Office of Management and Budget (OMB) director, Mick Mulvaney, on the same day that the public comment period ended for the proposed change.

The letter was led by Rep. Bobby Scott (D-VA), who chairs the House Education and Labor Committee, and it was signed by the chairs of Ways and Means, Oversight and Reform, Budget, Transportation and Infrastructure, Armed Services, Veterans Affairs, Small Business, Natural Resources, Appropriations and Energy and Commerce committees.

House Extends Money Follows the Person Funding, Mental Health Demonstration

On June 18, the House passed H.R. 3253, the Empowering Beneficiaries, Ensuring Access, and Strengthening Accountability Act, 371-46. The legislation, introduced by Rep. Debbie Dingell (D-MI), funds the Money Follows the Person demonstration through 2024, preserves asset protections for the spouses of Medicaid beneficiaries who receive long-term care benefits and extends the Community Mental Health Services Demonstration. Both the Money Follows the Person program, which helps Medicaid beneficiaries’ transition from nursing homes to community-based care, and the spousal impoverishment protections would be extended to 2024 under the bill.

Senate – see hearings above

Administration

FDA Expands Paragraph IV Patent List to Help Boost Generic Competition

On June 18, the Food and Drug Administration (FDA) expanded its patent certification list to include additional data that can help subsequent generic drug applicants determine when their products can be approved and marketed. The list now includes information on the status of 180-day exclusivity decisions for drugs, dates of first approval, marketing status and expiration dates of blocking patents. Find the full press release here.

CMS Asks for Feedback to Reduce Regulatory Burdens

On June 6, the Centers for Medicare and Medicaid Services (CMS) announced a request for information (RFI) asking for another round of feedback on ways to cut administrative and regulatory burden through its Patients over Paperwork campaign, an initiative to lower health care costs. The RFI specifically looks for ways to cut down on the burden posed by prior authorization procedures, beneficiary enrollment and beneficiary eligibility determinations, as well as burdens on rural providers and duals.

Comments must be submitted by Aug. 12, 2019.

Find the RFI here.

CMS Sends States Guidance on Medicaid Program Integrity

On June 20, the Centers for Medicare and Medicaid Services (CMS) issued guidance to state Medicaid agencies to outline a series of steps the agency has taken since 2017 in an effort to reduce Medicaid improper payments.   

The guidance specifically emphasizes CMS’s expectations for states that may be considering or that have implemented the Medicaid expansion. This comes in recognition of the increased risk resulting from the enhanced federal share of costs. States in the process of expanding coverage to the new adult group should provide these assurances of compliance with applicable program requirements when submitting the appropriate state plan amendments to CMS.

CMS is also developing an assurance template, based on the program readiness checklist included in the guidance, for states that have already adopted the adult group where states can attest to having proper systems and procedures in place to ensure appropriate claiming of the enhanced federal match of funds. As part of CMS’s ongoing program integrity efforts for the Medicaid program, states may be subject to future program oversight reviews or audits to ensure compliance with these requirements.

Find more information here.

Final Rules/Guidance

CMS Releases Guidance to Combat Medicaid Eligibility Errors

On June 20, the Centers for Medicare and Medicaid Services (CMS) issued guidance to state Medicaid agencies with necessary assurances that states should make to ensure that program resources are reserved for those who meet eligibility requirements. CMS added that it is developing an assurance program, based on the program readiness checklist included in the guidance, for states that have already expanded. The guidance added that assurance templates can be used by states to attest that they have proper systems and procedures in place to make sure the larger federal match they claim for the expansion population is appropriate.

Find more on the guidance here.

Health Reimbursement Arrangement Rule Finalized

On June 13, the Trump administration finalized a rule allowing employers to offer health reimbursement arrangements (HRA) for employees to enroll in the individual market or in short-term plans beginning in 2020. The final rule creates individual coverage HRAs that reimburse premiums for individual health insurance chosen by the employee, as well as excepted benefit HRAs that allow employers to finance additional medical care or plans, such as short-term health plans. This rule was released by the Department of Labor, Department of Health and Human Services and the Treasury.

Find the final rule here.

FDA: Final Guidance Premarket Tobacco Product Applications for Electronic Nicotine Delivery Systems (ENDS)

On June 11, the Food and Drug Administration (FDA) finalized its guidance for manufacturers submitting new tobacco product applications through the premarket tobacco product application (PMTA) pathway for electronic nicotine delivery systems (ENDS), such as e-cigarettes or “vapes,” and the liquid nicotine and nicotine-containing e-liquids used with such products. The final guidance is meant to improve the efficiency of application submission and review.

Find the final guidance here.

President Trump to Sign Executive Order on Health Price Transparency

On June 24, President Trump will sign an executive order directing the Department of Health and Human Services to develop regulations requiring healthcare insurers and providers to be more transparent about pricing. The plan is to have providers and insurers disclose the prices of care they negotiate, including routine checkups, drugs, major surgeries, in-patient treatments, medical supplies, therapies, and more. As a result, how much hospitals charge for common procedures and treatment will become available to patients.

Proposed Regulations/Guidance

FDA Considering New Incentives for Safer Pain, Addiction Therapies

On June 20, the Food and Drug Administration (FDA) released a draft guidance weighing broader public health effects as it reviews proposed opioids that could be safer pain and addiction therapies, as well as any comparative advantage the proposed product would have over currently approved analgesics. The FDA also announced a public hearing for Sept. 17 to discuss the FDA’s benefit-risk assessment of opioid analgesics, including the manner in which risks of misuse and abuse of these products factor into the benefit-risk assessment.

Find the draft guidance, “Opioid Analgesic Drugs: Considerations for Benefit-Risk Assessment Framework,” here.

Find the press release here.

CMS: Fiscal Year (FY) 2020 Medicare Hospital Inpatient Prospective Payment System (IPPS) and Long-Term Acute Care Hospital (LTACH) Prospective Payment System

On April 23, 2019, the Centers for Medicare and Medicaid Services (CMS) proposed to update Medicare payment policies for hospitals under the Inpatient Prospective Payment System (IPPS) and the Long-Term Acute Care Hospital (LTACH) Prospective Payment System (PPS) for fiscal year 2020. The proposals include a raise in pay for low-wage hospitals by cutting pay for high-wage hospitals, as part of the reforms to the hospital wage index, as well as raising the add-on pay for new technology and providing a path for breakthrough devices approved by the Food and Drug Administration (FDA) to access add-on payments. CMS also proposed policy changes to increase significantly Medicare pay to hospitals for administering expensive chimeric antigen receptor T-cell (CAR-T) cancer drugs and make it easier for hospitals to get the maximum possible reimbursement for administering the CAR-T cell therapies.

Find the proposals here.

CMS Proposes Increasing Payments to Inpatient Rehabilitation Facilities

On April 17, 2019, the Centers for Medicare and Medicaid Services (CMS) proposed a rule to update Medicare payment policies for facilities under the Inpatient Rehabilitation Facility Prospective Payment System (IRF PPS) and the Inpatient Rehabilitation Facility Quality Reporting Program (IRF QRP) for fiscal year (FY) 2020.

CMS is proposing to raise the estimated payments per discharge for inpatient rehabilitation facilities in federal fiscal year 2020 by 2.3 percent, or $195 million, compared to 2019. The proposal could boost payments in urban areas by 2.2 percent and rural areas by 4.3 percent compared to the year before.

Comment period ends on June 27, 2019.

Find the proposed rule here.

Courts

U.S. Supreme Court Agrees to Hear ACA-related Case

The Supreme Court on June 24, agreed to hear a challenge from health insurers who argue the federal government owes them money from the Affordable Care Act’s risk corridors program.   The justices’ decision to take the case means it will reconsider an earlier appellate court ruling that the federal government isn’t on the hook for the payments.

Lower courts split on the merits of the legal claims. Oregon-based Moda Health won a $200 million judgment, but the $70 million claim from the now-defunct Land of Lincoln Health was rejected. A divided appellate court last June ruled against the insurers in a combined case, finding that Congress clearly took action to prevent federal payouts to the program.

Maine Community Health Options is the third insurer that had appealed to the Supreme Court to take up the issue. The cases will be consolidated and scheduled for one hour of oral arguments.

Other

UnitedHealth Gets FTC Approval for DaVita Acquisition

On June 19, the Federal Trade Commission (FTC) approved the UnitedHealth Group Inc.’s $4.3 billion acquisition of DaVita Medical Holdings LLC. UnitedHealth will gain a network of close to 300 clinics that treat over 1.7 million patients every year, though DaVita’s kidney dialysis unit is not included in the purchase. The FTC approved the deal on condition that UnitedHealth sell a Las Vegas facility to Utah-based to Intermountain Healthcare. DaVita will be rolled into UnitedHealth’s Optum unit, which has some 30,000 physicians. Denver-based DaVita operates medical groups in six states that serve 1.7 million patients through about 300 clinics.

Reports

GAO: Veterans Health Administration – Regional Networks Need Improved Oversight and Clearly Defined Roles and Responsibilities

On June 19, the Government Accountability Office (GAO) released a report reviewing the Veterans Health Administration’s (VHA) oversight of Veterans Integrated Services Networks (VISN) that manage the day-to-day functions of medical centers and provide administrative and clinical oversight of medical centers. The GAO found that quarterly reviews by the VHA do not typically include discussion of VISN-level performance measures, or how VISNs manage and oversee medical centers. By establishing a process for assessing the overall performance of VISNs in managing and overseeing medical centers, the VHA would be better able to determine if a VISN’s performance is positive, if it is functioning poorly or if it requires remediation.

The GAO also found that the VHA lacks a comprehensive policy to define VISN roles and responsibilities. According to the GAO, the lack of clearly defined roles and responsibilities at the VISN level makes it difficult for VHA to develop an effective oversight process that ensures adequate monitoring of VISN activities.

The GAO recommends:

  • The undersecretary for Health at the Department of Veterans Affairs (VA) develop a process to assess the overall performance of VISNs in managing and overseeing medical centers.
  • The undersecretary for Health establish a comprehensive policy that clearly defines VISN roles and responsibilities for managing and overseeing medical centers.
  • The undersecretary for Health establish a process to routinely oversee VISN staffing, to include ensuring VISNs are consistent with VHA’s standardized VISN staffing levels and positions, and documenting the rationale for approving staffing that does not adhere to VHA’s standardized approach.

Find the full report here.

GAO: Black Lung Benefits Program – Financing and Oversight Challenges Are Adversely Affecting the Trust Fund

On June 20, the Government Accountability Office (GAO) released a report on the Black Lung Benefits Program, specifically on the Trust Fund, which pays benefits to certain coal miners; the program faced financial challenges due to the coal tax rate decrease and declining coal production. The GAO found that the Trust Fund revenue will be further limited by the coal tax rate decrease of about 55 percent that took effect in 2019, and declining coal production and that Trust Fund revenue may not be sufficient to cover beneficiary payments and administrative costs, from fiscal years 2020 through 2050.

Therefore, the Trust Fund could need to continue borrowing to cover its expenditures, including the repayment of past debt and interest, and the Trust Fund’s simulated outstanding debt could exceed $15 billion by 2050. However, as the GAO reported in 2018, various options, such as adjusting the coal tax and forgiving debt, could improve the Trust Fund’s financial position.

The GAO will be considering recommendations, as appropriate, when ongoing work is finished.

Find the full report here.

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

Stephanie Kennan, Senior Vice President
Mariam Eatedali, Research Associate

Founded in 1998,McGuireWoods Consulting LLC(MWC) is a full-service public affairs firm offering infrastructure andeconomic development, strategic communications & grassroots, and governmentrelations services. McGuireWoods Consulting is a subsidiary of theMcGuireWoods LLPlaw firm and has been named in The National Law Journal’s special annualreport, “The Influence 50,” for the past several years. In the most recentreport, McGuireWoods Consulting was ranked 15th of the 1,900 governmentrelations firms in Washington, D.C.

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