Oct 5, 2020
Washington Healthcare Update
This week in Washington: The Continuing Resolution (CR) to fund the government until Dec. 11 was signed by President Trump; House passes COVID-19 stimulus bill.
House Committee on Oversight and Reform: Unsustainable Drug Prices: Testimony from the CEOs (Parts I and II)
Sept. 30, 2020: The House Committee on Oversight and Reform held two days of hearings (Sept. 30 and Oct. 1) with executives of major drug manufacturers to examine their pricing practices for some of the costliest drugs in the U.S.
Find more information on meeting here.
Why this is important: Members of the committee questioned a panel of executives from pharmaceutical manufacturers Celgene Corp., Bristol-Myers Squibb Co. and Teva Pharmaceutical Industries Ltd. over why they have raised U.S. drug prices while selling them in other countries for a fraction of the cost. Committee Chairwoman Carolyn Maloney (D-NY) referenced reports from committee’s investigations that show the manufacturers have continued to inflate prices because they are allowed to do so, whereas other countries require price negotiations with the federal government.
Find the committee’s full report here.
House Committee on Energy and Commerce: Pathway to a Vaccine – Ensuring a Safe and Effective Vaccine People Will Trust
Sept. 30, 2020: The Subcommittee on Oversight and Investigations of the Committee on Energy and Commerce held a hearing with status updates on the COVID-19 vaccine’s development.
Find more information on meeting here.
Why this is important: Democrats on the subcommittee fear scientists are not allowed to do their jobs in developing the vaccine and are concerned these scientists are being rushed and are dealing with political interference.
Select Subcommittee on the Coronavirus Crisis: Hearing on HHS Response to the COVID-19 Pandemic
Oct. 2, 2020: The Select Subcommittee on the Coronavirus Crisis held a hearing with Secretary Alex Azar on the Department of Health and Human Services’ (HHS) response to the coronavirus pandemic. The hearing examined the Trump administration’s handling of scientific studies at the Centers for Disease Control and Prevention (CDC) and Food and Drug Administration (FDA), transparency concerns and critique of the national plan to contain the coronavirus.
Find more information on meeting here.
Why this is important: The subcommittee sought clarification from Secretary Azar after President Trump contradicted public health experts by saying that a vaccine could be available by the November presidential election. Azar said he is confident in the safety of any authorized vaccine.
House Democrats Pass Revised HEROES Act
On Oct. 1, the House passed H.R. 6800, the revised Health and Economic Recovery Omnibus Emergency Solutions Act (HEROES Act), with a vote of 214 to 207. This version of the bill costs $2.2 trillion and includes a new provision that would give the Food and Drug Administration (FDA) $1.5 million to hold one or more advisory committee meetings to discuss coronavirus vaccine authorization or approval requests. The bill creates a special enrollment period in healthcare.gov and Affordable Care Act (ACA) tax credits for anyone who has lost a job, and increases Medicaid matching funds, but does not include subsidies for the Consolidated Omnibus Budget Reconciliation Act (COBRA). The bill also provides $75 billion for coronavirus testing, contact tracing and isolation measures and $28 billion for procurement, distribution and education campaigns for a safe and effective vaccine. The bill adds $50 billion to the provider relief fund.
The Senate has shown no interest in this bill. House Speaker Nancy Pelosi (D-CA) and Secretary of the Treasury Steve Mnuchin continue to discuss COVID-19 stimulus funding.
Find the bill here.
Houses Passes Bill to Extend Medicaid to Postpartum Beneficiaries
On Sept. 29, the House passed a bipartisan bill that would create a new state plan option to extend Medicaid eligibility for up to one year after a beneficiary gives birth. The bill, introduced last year by Reps. Robin Kelly (D-IL), Lauren Underwood (D-IL), Cathy McMorris Rodgers (R-WA), Ayanna Pressley (D-MA), Buddy Carter (R-GA) and Michael Burgess (R-TX), also incentivizes states that choose to extend Medicaid for postpartum beneficiaries by increasing their federal Medicaid match 5 percent. The Congressional Budget Office (CBO) estimated that the bill would increase off-budget revenues by $649 million.
Find the Mothers and Offspring Mortality and Morbidity Awareness (MOMMA’s) Act here.
Six Republican Senators Join Democrats on Motion to Debate Legislation to Block DOJ Concerning the Affordable Care Act
On Oct. 1, six Senate Republicans [Sens. Cory Gardner (R-CO), Joni Ernst (R-IA), Martha McSally (R-AZ), Dan Sullivan (R-AK), Susan Collins (R-ME) and Lisa Murkowski (R-AK)] voted with Democrats on a procedural motion to debate a bill that would block the Department of Justice (DOJ) from arguing against the Affordable Care Act (ACA) at the Supreme Court in November. Five of the six Republican senators are up for reelection this cycle. The bill was not expected to pass but was a message to the Trump administration ahead of the Supreme Court case.
Bennet, Young Introduce Bipartisan Bill to Create New Antibiotic Subscription Model
On Sept. 30, Sens. Michael Bennet (D-CO) and Todd Young (R-IN) introduced legislation to establish a payment model under which antibiotic developers could get upfront payment for new antibiotics. The bill builds upon an existing framework to improve data collection for antibiotic use. The Pioneering Antimicrobial Subscriptions to End Upsurging Resistance (PASTEUR) Act requires the Department of Health and Human Services (HHS) to set up a committee, the Committee on Critical Need Antimicrobials, to develop a pilot subscription and reimbursement model that incentivizes manufacturers to create antibiotics for targeted microbes.
Find the bill here.
President Signs CR to Avoid Government Shutdown
On Sept. 30, the Senate passed a continuing resolution (CR) that funds the government through Dec. 11, avoiding a government shutdown. The CR extends funding for several Medicare and Medicaid programs, among other health care program extenders. The full package includes Medicare and Medicaid extenders, a delay in cuts to Medicaid disproportionate share hospitals and an extension of the repayment deadline and lowered interest for certain COVID-19 provider relief payments. It also includes a clarification that drugs used in medication-assisted treatment can continue to get Medicaid rebates, an increase in funding for the Medicaid improvement fund, protection of Medicare beneficiaries from an expected Part B premium hike and extension of the Food and Drug Administration’s (FDA) rare pediatric disease priority review voucher program.
Find more information from McGuireWoods Consulting senior vice president Stephanie Kennan here.
HHS: Remdesivir Approved to be Sold Directly to Hospitals
On Oct. 1, the Department of Health and Human Services (HHS) announced that Gilead Sciences and its distributor have been cleared to sell its Remdesivir COVID-19 antiviral drug directly to hospitals. The drug, branded as Veklury, was being distributed across the U.S. by HHS, but HHS Secretary Alex Azar said that the federal government oversight of the allocation of Remdesivir is not required because the drug is no longer a scarce resource.
Find more information here.
HHS: List of Regulatory Actions for President Trump’s America First Health Care
On Oct. 1, President Trump signed an executive order with a goal to lower drug costs, lower insurance premiums, provide easier access to prices of health care services and to medical records and create new protections from surprise bills.
As part of the executive order, the Department of Health and Human Services took the following actions:
- Issued a final rule and guidance from the Food and Drug Administration (FDA) to open the first-ever pathway for states to use to safely import prescription drugs to lower patients’ drug costs.
- Solicited private-sector proposals, as called for in the president’s July executive order, on allowing Americans to get lower-cost FDA-approved drugs and insulins from American pharmacies via importation and reimportation.
- Released the 2021 Medicare Advantage and Medicare Part D Premium landscape, showing that average 2021 premiums for Medicare Advantage plans are expected to decline 34.2 percent from 2017 while plan choice, benefits and enrollment continue to increase, and that Part D premiums will be down 12 percent from 2017, with over 1,600 drug plans offering insulin at less than $35 per month.
- Issued a notice of proposed rulemaking from the Health Resources and Services Administration (HRSA) to pass on discounts at community health centers on insulin and epinephrine to Americans who are uninsured or have high cost-sharing, including the nearly 3 million health center patients with diabetes.
Find more information about the Requests for Proposal Regarding Waivers for Individual Prescription Drug Importation Programs here.
Find more information about the Request for Proposals Regarding Insulin Reimportation Programs here.
CMS: FY 2018 and FY 2019 Performance Scores for the Skilled Nursing Facility Healthcare-Associated Infections Requiring Hospitalizations Measure
On Sept. 28, the Centers for Medicare and Medicaid Services (CMS) announced the Confidential Dry Run Reports containing FY 2018 and FY 2019 performance scores for the Skilled Nursing Facility Healthcare-Associated Infections Requiring Hospitalizations measure (SNF HAI measure) are now available. Performance scores are based on the draft measure specifications posted on CMS Measure Management Public Comment page. Providers can view these reports in their Certification and Survey Provider Enhanced Reports (CASPER) provider-shared folders. The purpose of these Confidential Dry Run Reports is to allow SNFs to become familiar with this measure and to inform them of their performance in comparison to their peers. Review and use of this measure information is voluntary.
FDA Has Shared Vaccine EUA-Plus Criteria with Industry
On Sept. 30, the Food and Drug Administration (FDA) shared its criteria for vaccine emergency use authorization (EUA) directly with vaccine manufacturers, even though the Department of Health and Human Services (HHS) has not published the guidance. For the past couple of months, FDA officials said that coronavirus vaccine that comes to the market under a EUA will have to follow an “EUA-plus” standard, meaning that the safety and efficacy criteria will be closer to those required to obtain full FDA approval.
DOJ Charges 345 Professionals in Health Fraud Schemes of Up to $6B
On Sept. 30, federal prosecutors have charged 345 executives, doctors and other medical professionals with perpetuating hundreds of health care fraud schemes involving more than $6 billion related to telemedicine, illegal opioid distribution and durable medical equipment (DME). The telemedicine fraud charges made up the bulk of the charges, implicating more than $4.5 billion in federal government losses.
OMB Reviews Rule to Delay Interoperability Rule Compliance Dates
On Sept. 30, the Office of Budget and Management (OMB) is reviewing an interim rule that extends the compliance timelines for the Department of Health and Human Services (HHS) Office of the National Coordinator’s (ONC) information blocking and interoperability rule finalized in March, due to the COVID-19 pandemic. ONC said on its website it would exercise enforcement discretion up to three months after the initial compliance date and timeline in the rule. At that time, ONC also moved some deadlines for compliance into later in 2021.
DOD Awards $20M for Domestic Manufacturing of Drugs, Ingredients
On Sept. 29, the Department of Defense (DOD) awarded a $20 million contract to On Demand Pharmaceuticals for domestic manufacturing of prescription drugs and ingredients as part of the effort to avert drug shortages and price gouging during the COVID-19 pandemic. The DOD’s Defense Advanced Research Projects Agency (DARPA) already funded the development of the company’s drug-manufacturing technology, and the company now is getting money set aside by the Coronavirus Aid, Relief, and Economic Security (CARES) Act for pandemic response projects.
HHS Proposes Rule to Implement President Trump’s Insulin Executive Order
On Sept. 28, the Department of Health and Human Services (HHS), through the Health Resources and Services Administration (HRSA), released a notice of proposed rulemaking to ensure health center grants are given to health centers that purchase insulin and injectable epinephrine through the 340B Drug Pricing Program, with established practices to make these drugs available at the discounted price paid under the 340B Program. These discounted drugs will be available to health center patients with low incomes who also have health insurance with a high cost-sharing requirement for either insulin or injectable epinephrine, health insurance with a high-unmet deductible or no health insurance.
Find the proposed rule here. Public comments are due by Oct. 28, 2020.
CMS Proposes to Expand Telehealth Benefits Permanently for Medicare Beneficiaries Beyond the COVID-19 Public Health Emergency
On Aug. 4, the Centers for Medicare and Medicaid Services (CMS) proposed permanently extending the availability of certain telemedicine services after the COVID-19 public health emergency (PHE) ends, giving Medicare beneficiaries access to health care particularly in rural areas where access to health care providers may otherwise be limited. CMS is proposing to permanently allow some telehealth services, including home visits for the evaluation and management of a patient (in the case where the law allows telehealth services in the patient’s home), and certain types of visits for patients with cognitive impairments. CMS is seeking public input on other services to permanently add to the telehealth list.
The billing and coding requirements for Evaluation and Management (E/M) (or office/outpatient visits) make up 20 percent of the spending under the Physician Fee Schedule. Simplified coding and billing requirements for E/M visits will go into effect Jan. 1, 2021. In this rule, CMS is proposing to increase the value of many services that are comparable to or include office/outpatient E/M visits such as maternity care bundles, emergency department visits, end-stage renal disease capitated payment bundles, physical and occupational therapy evaluation services and others.
Find the proposed rule here. Public comments are due by Oct. 5, 2020.
CMS Lowers Testing Threshold for Nursing Home Staff
On Sept. 29, the Centers for Medicare and Medicaid Services (CMS) lowered the thresholds for testing nursing home staff for COVID-19, basing its new methodology on the number of tests done in the county as well as COVID-19 positivity rates. The counties that previously were required to test once a week will now only need to test once a month if there were 20 or fewer tests conducted over 14 days. Counties previously required testing twice a week will now only need to test once a week if they conducted both fewer than 500 tests and fewer than 2,000 tests per 100,000 residents, and greater than 10 percent positivity over 14 days. CMS told nursing homes it made the change because of concerns rural counties had seemingly high comparative positivity rates due to low levels of testing instead of actual positivity in the community.
Find more information here.
Find a comprehensive look at “Courts and Healthcare Policy in 2020” here.
Insurers Seek Full Court Review of Cost-Sharing Reduction Case
The insurers suing the Trump administration for stopping the Affordable Care Act’s (ACA) cost-sharing reduction (CSR) reimbursements filed a motion for the full Federal Circuit Court to review last month’s ruling that found the federal government must reimburse insurers for the CSRs due in 2017 but can lower the amount due in 2018 because of the higher tax credits resulting from insurers’ silver-loading workaround. Insurers have already requested about $1.7 billion from the 2017 plan year and more is possible in the 2018 plan year and beyond. Insurers argue the federal government is obligated to make the payments regardless of the tax credits. They also argue that premium tax credits are based on consumer income and therefore should not be used to reduce the payment owed.
MACPAC Announces Concern About How States Will Restart Medicaid Redetermination After COVID-19 Pandemic
On Sept. 28, the Medicaid and Children’s Health Insurance Program Payment and Access Commission (MACPAC) members announced that the Centers for Medicare and Medicaid Services (CMS) needs to release guidance before the end of the COVID-19 public health emergency on how states should restart the Medicaid redetermination process. The commissioners fear states might be too anxious to remove beneficiaries and overwhelm the system. While the commissioners acknowledged Medicaid beneficiaries would be notified before they lose their coverage, the commissioners are concerned CMS might take too long to issue guidance on how to restart the redetermination process.
CBO: An Overview of the 2020 Long-Term Budget Outlook
On Oct. 1, the Congressional Budget Office (CBO) released a budget outlook and overview from 2020. By the end of 2020, federal debt held by the public is projected to equal 98 percent of gross domestic product (GDP), its highest level since shortly after World War II. If current laws governing taxes and spending generally remained unchanged, debt would first exceed 100 percent of GDP in 2021 and would reach 107 percent of GDP, its highest level in the nation’s history, by 2023, CBO projects. Debt would continue to increase in most years thereafter, reaching 195 percent of GDP by 2050.
Find the full report here.
CBO: Policies to Achieve Near-Universal Health Insurance Coverage
On Oct. 1, the Congressional Budget Office (CBO) released a report that examines policy approaches that could achieve near-universal health insurance coverage using some form of automatic coverage through a default plan. As defined by CBO, a proposal would achieve near-universal coverage if close to 99 percent of citizens and noncitizens who are lawfully present in this country were insured either by enrolling in a comprehensive major medical plan or government program or by receiving automatic coverage through a default plan.
CBO organized existing proposals into four general approaches, ranging from one that would retain existing sources of coverage to one that would almost entirely replace the current system with a government-run program. All four approaches would provide automatic coverage to people who did not enroll in a plan on their own. Two approaches would fully subsidize coverage for lower-income people and partially subsidize coverage for middle-income and some higher-income people while retaining employment-based coverage. The other two approaches would fully subsidize coverage for people at all income levels. The approaches that CBO examined would require varying amounts of government spending to cover the same number of people. They would all require additional federal receipts to achieve deficit neutrality.
Find the full report here.
GAO: VA Health Care - Additional Steps Could Help Improve Community Care Budget Estimates
On Sept. 30, the Government Accountability Office (GAO) released a report on how most veterans seek Department of Veterans Affairs (VA) medical services using its 170 medical centers or over 1,000 outpatient facilities. Veterans may also use community care, services from non-VA providers, in some cases, such as when they face long waits or drive times to VA facilities. Congress expanded access to community care beginning in June 2019. The VA estimates community care will cost $21.3 billion in FY 2022—a 45 percent increase from FY 2018—in part because of the recent expansion. GAO found ways the VA could improve its actuarial modeling and make its budget estimates more reliable.
Find GAO recommendations here and find the full report here.
GAO: Veterans Community Care Program - Improvements Needed to Help Ensure Timely Access to Care
On Sept. 28, the Government Accountability Office (GAO) released a report on the Department of Veterans Affairs (VA) and the implementation of the Veterans Community Care Program in June 2019. The new program replaced similar programs that allow eligible veterans to receive care from non-VA providers. GAO reviewed how the VA implemented the new program and found:
- The VA has not established a timeliness goal for veteran care;
- Few community providers use the VA’s new software system to exchange information electronically with VA medical centers;
- Few VA medical centers have the recommended number of staff for the program.
Find GAO’s recommendations here and find the full report here.
If you have any questions, contact the following individuals at
Stephanie Kennan, Senior Vice President
Mariam Eatedali, Research Associate
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