Washington Healthcare Update

October 3, 2022

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This Week in Washington: Congress Passes Continuing Resolution until Dec. 16; House Leaves Until After Election; Senate to be Back Mid-October. 

Congress

House

Administration

Proposed Rules

Final Rules

Reports

Congress

House

Following the Senate’s vote on Sept. 29, a Continuing Resolution funding the government through Dec 16 passed the House on Sept. 30 by 230-201. Ten Republicans joined Democrats to pass the legislation to fund the government through Dec. 16. The Senate passed the legislation 72-25.

The CR was stalled in the Senate because of provisions related to speed up permitting for energy projects, which had been included because a vote on the provisions had been promised to Sen. Joe Manchin (D-WV). After Sen. Manchin requested the provisions be removed so they did not stall the CR further, the bill gained bipartisan support.

Included in the CR were an additional $62 million for the 9-8-8 Suicide and Crisis Lifeline’s prevention and behavioral health services, and an extension of enhanced Medicaid federal matching assistance program for Puerto Rico and other territories. Extensions were also included for the Medicare low-volume payment program, and the drug user fees for the Food and Drug Administration. 

Mental Health Matters Act Passes

In a mostly party line 220-205 vote, the House passed the Mental Health Matters Act, which addresses the “severe impact” COVID-19 had on students, educators and families by putting more mental health experts in schools and expanding that pipeline of school-based professionals. 

One Republican, Rep. Brian Fitzpatrick (R-PA), voted for the legislation, which would provide grants to establish a pipeline for school-based mental health service professionals. The Department of Education would administer the grants.

Administration

Ahead of White House’s Conference on Hunger, Nutrition, and Health, Administration Unveils National Strategy

On Sept. 26, ahead of the administration’s Conference on Hunger, Nutrition, and Health, the administration released its National Strategy on Hunger, Nutrition, and Health. 

In that strategy the administration recommends that Medicare should cover medically tailored meals while states should be able to use Section 1115 waivers to provide Medicaid beneficiaries nutrition education. In addition, the administration also plans to create a permanent diabetes program for enrollees in all public health programs, including marketplace plans, and will collect data on what types of nutrition services exchange plans currently cover to explore whether the essential benefits should be expanded to include those services.

To read the strategy https://www.whitehouse.gov/wp-content/uploads/2022/09/White-House-National-Strategy-on-Hunger-Nutrition-and-Health-FINAL.pdf

HHS Resolution Panel Dismisses NAHC Dispute on 340B Payment

An administrative dispute resolution panel dismissed a dispute brought by the National Association of Community Health Centers concerning whether drug makers may deny 340B drug discounts when health centers use multiple contract pharmacies. The administrative dispute resolution panel based the dismissal on a court ruling in a suit that AstraZeneca brought against HHS’s attempt to require 340B drug discounts regardless of the number of contract pharmacies that dispense the drugs. In that case, a federal judge in Delaware ruled that Congress did not “clearly and unambiguously” require drug companies to discount drugs, no matter how many contract pharmacies hospitals or health centers dispense them. However, health centers are barred from using the courts to resolve disputes, and the court was presented with a different question than the dispute resolution panel, according to NAHC.

HHS Makes Bebtelovimab Available to Uninsured and Underinsured

This week HHS unveiled a new initiative to help uninsured and underinsured Americans access the COVID-19 treatment bebtelovimab and to smooth out the transition from reliance on drugs purchased by the government to reliance on the commercial marketplace. Under the program, effective immediately, providers that treat an uninsured or underinsured patient with a commercially procured dose of bebtelovimab can seek a free replacement dose from HHS.

CMS Announces Premium Decreases for 2023

On Sept. 29, the Centers for Medicare and Medicaid Services announced reductions in Medicare Advantage premiums an average of $18 a month for 2023, down about 8 percent from 2022. CMS estimates 31.8 million people will sign up for an MA plan for 2023 as Medicare open enrollment starts Oct. 15.

However, because the Inflation Reduction Act (IRA) passed after plans submitted their annual plan bid packages, the plan data displayed in the Medicare Plan Finder will not reflect the RA insulin cost-sharing cap. 

CMS says people with Medicare won’t pay more than the $35 per month cost-sharing cap and deductibles won’t be applied with respect to the covered insulin products. CMS also says Medicare.gov will include information on the new benefit to let Medicare Plan Finder users know the prices of insulin in the plan finder won’t necessarily match what beneficiaries will pay.

CMS suggests that beneficiaries don’t include insulin in their drug list when searching on the Medicare Plan Finder, and instead calculate out the cost manually—$420 annually—and add it back in later to estimate a maximum cost. Next, those using the plan finder should update the drug list with insulin products and dosage to make sure they are covered by a plan. 

The average basic monthly premiums for Part D, which were previously announced, are projected to be $31.50, compared to $32.08 in 2022.

CMS Lowers Part B Premiums and Deductible for 2023

CMS also announced that Part B premiums will decrease by $5.20 a month next year in large part to compensate for lower-than-expected spending on Aduhelm. The standard monthly premium for Medicare Part B enrollees will be $164.90 for 2023, a decrease from $170.10 this year. The Part B deductible will also decrease by $7 to $226.

CMS raised the Medicare Part B premium for 2022 by $21.60 to cover the anticipated annual $56,000 cost of the Alzheimer’s drug, but the drug’s price was reduced in half by its manufacturer, and Medicare decided to only pay for the drug when it’s used in a post-market clinical trial.

Because of those changes, CMS spent less than expected on the drug, as well as other Part B items and services, resulting in much larger reserves in the Part B account of the Supplementary Medical Insurance (SMI) Trust Fund.

In May, HHS Secretary Becerra had recommended CMS decrease 2023 premiums to account for the lower spending. 

Part B income-adjusted monthly premiums.

  • $164.90: standard Part B premium, individuals (less than or equal to $97,000); couples (at or below $194,000).
  • $230.80: individuals (over $97,000 to $123,000); couples (over $194,000 to $246,000).
  • $329.70: individuals (over $123,000 to $153,000); couples (over $246,000 to $306,000).
  • $428.60: individuals (over $153,000 to $183,000); couples (over $306,000 to $366,000).
  • $527.50: individuals (over $183,000 up to $500,000); couples (over $366,000 up to $750,000).
  • $560.50: individuals ($500,000 or more); couples ($750,000 or more).

CMS also noted that next year certain Medicare enrollees who are 36 months out from a kidney transplant—and as such no longer eligible for full Medicare coverage—can choose to continue Part B coverage of immunosuppressive drugs by paying a premium that starts at $97.10. Monthly income-related premiums for immunosuppressive drug coverage will go up to $485.50 at the highest income tier.

For the CMS Fact Sheet https://www.cms.gov/newsroom/fact-sheets/2023-medicare-parts-b-premiums-and-deductibles-2023-medicare-part-d-income-related-monthly

FDA and VA Collaborate to Develop Tools to Test Safety of Medical Devices

On Sept. 28, the Food and Drug Administration (FDA) and the Veterans Health Administration announced they will collaborate to develop and disseminate new tools to test the safety and effectiveness of medical devices and emerging technologies, with an initial focus on interoperable systems that can help advance automation, telemedicine and personalized health care.

The collaboration, established through a memorandum of understanding, is expected to increase development of “off-the-shelf” testing tools that can provide innovators with reproducible and cost-effective testing methods throughout the product development cycle. The FDA and VHA will initially focus on interoperable systems that can exchange health information automatically for the diagnosis and treatment of patients. According to the MOU, the agencies’ work around interoperability could help address medical needs in underserved rural populations by advancing the ability to monitor and treat patients outside of hospitals.

Seattle-based VA Ventures Innovation Institute, a part of the Department of Veterans Affairs, will host 12 members of FDA staff who will focus on regulatory science. VA Ventures staff will provide the clinical context for test development and provide hands-on training for innovators.

FDA Approves ALS Drug

On Sept. 29 the FDA approved Amylyx Pharmaceuticals’ amyotrophic lateral sclerosis drug Relyvrio, which the FDA and the company say could potentially meet an unmet need in ALS treatment. The drug has been considered controversial because questions have been raised about the drug’s efficacy. FDA and Amylyx have committed to pull Relyvrio from the market if future data show it to be ineffective.

Earlier in September, Relyvrio (sodium phenylbutyrate/taurursodiol) received an orphan drug designation

The approval of Relyvrio falls in line with recommendations from a panel of agency advisors that earlier this month voted in favor of approving the drug after Amylyx submitted new analyses to confirm Relyvrio’s effectiveness.

In March the same advisory panel narrowly voted, by a vote of 6-4, that the data from Amylyx’s single double-blind CENTAUR trial and its open-label extension study did not provide enough evidence that the drug is effective against ALS.

After the March advisory committee meeting, Amylyx submitted additional analyses to FDA that the company said served as confirmatory evidence to support the findings from the CENTAUR study. During the follow-up advisory committee meeting in September, members of the agency’s Peripheral and Central Nervous System Drugs Advisory Committee said they were swayed by the analyses.

FDA Names Lead Advisor for Cannabis Research and Regulation Efforts

On Sept. 26, the FDA named Norman Birenbaum, former New York state cannabis program director, as a senior public health advisor to help lead the drug center’s cannabis research and regulation efforts. 

Birenbaum, who has also served on the staff of U.S. Sen. Elizabeth Warren (D-MA), will use his expertise in policy analysis and legislative outreach related to cannabis and cannabis-derived products to create partnerships and advance FDA’s outreach with the healthcare community, including with patients and patient advocacy groups. Birenbaum previously served as chief cannabis policy advisor to the governors of New York and Rhode Island and led the agencies responsible for cannabis regulation and research in both states.

In May, the FDA announced that Principal Deputy Commissioner Janet Woodcock would chair the agency’s Cannabis Products Council, an intra-agency group that works on cannabis product policy, enforcement and outreach issues and that will help implement the agency’s data collection plan for cannabis products.

Proposed Rules

HHS Announces Proposed Rule to Implement Section 1557 of the ACA

On July 25, the Department of Health and Human Services (HHS) released a proposed rule to implement Section 1557 of the Affordable Care Act (ACA) that bans discrimination based on race, color, national origin, sex, age and disability in certain health programs and activities. The proposed rule expands civil rights protections for patients in certain federally funded programs by clarifying the scope and application of Section 1557. An HHS press release on the proposed rule can be found here.

FDA Releases Proposed Rule to Standardize the National Drug Code Format

On July 25, the Food and Drug Administration (FDA) issued a proposed rule titled “Revising the National Drug Code Format and Drug Label Barcode Requirements.” The proposed rule would amend the National Drug Code (NDC) to require one standardized format for all NDCs.

Public comments will be accepted until Nov. 22, 2022.

Final Rules

Homeland Security Issues Final Rule Reversing Trump “Public Charge” Rule

On Sept. 8 the administration issued final rules making it clear that the Department of Homeland Security will not refuse entry to non-citizens seeking admission to the U.S. or a green card due to their likelihood to receive Medicaid/CHIP or other health benefits except for long-term institutionalized care. The rule reverses the Trump administration’s public charge rules issued in 2019. 

https://public-inspection.federalregister.gov/2022-18867.pdf

CMS Publishes Final Rule to Update FY 2023 Hospice Payment Rate

On July 27, the Centers for Medicare and Medicaid Services (CMS) published a final rule titled “Medicare Program; FY 2023 Hospice Wage Index and Payment Rate Update and Hospice Quality Reporting Requirements.” The final rule makes updates to Medicare hospice payments and the aggregate cap amount for Fiscal Year (FY) 2023. The FY 2023 hospice payment update will be increased to 3.8 percent and a permanent budget-neutral 5 percent cap will be established on any decrease to an area’s wage index. The final rule also discusses the Hospice Outcomes and Patient Evaluation tool and provides an update on FY 2023 Quality Measures, the Consumer Assessment of Healthcare Providers and Systems, and Hospice Survey Mode Experiment. A press release on the final rule with additional information can be found here.

The final rule will go into effect on Oct. 1, 2022.

CMS Publishes FY 2023 Inpatient Psychiatric Facilities Prospective Payment System Final Rule

On July 27, the Centers for Medicare and Medicaid Services published a final rule titled “Medicare Program: FY 2023 Inpatient Psychiatric Facilities Prospective Payment System; Rate Update and Quality Reporting; Request for Information.” The final rule will update Medicare payment rates for the Inpatient Psychiatric Facility Prospective Payment System (IPF PPS) for Fiscal Year (FY) 2023 and sets a permanent 5 percent cap. The rule does not make any changes to the IPF Quality Reporting Program. A press release with additional information can be found here.

The final rule will go into effect on Oct. 1, 2022.

Final Rule to Change Qualifications for Products to be Considered “Made in America” Released

On March 4, the Department of Defense, the General Services Administration and the Aeronautics and Space Administration announced a final rule that would increase manufacturing of critical supplies in the U.S. as part of President Biden’s “Made in America” policy. The final rule would require pharmaceutical companies that want their products to qualify as being “Made in America” for federal procurement purposes to increase the percentage of drug ingredients made in the U.S. from 55 percent to 75 percent in the next seven years. Specifically, the final rule would increase the threshold to 60 percent in 2022, 65 percent in 2024 and 75 percent in 2029. In addition, the rule will allow the government to apply price preferences to select drug products and components that will support the expansion of the domestic supply chain. The final rule will go into effect on Oct. 25, 2022.

The White House Fact Sheet on the final rule can be found here.

Reports

Efforts to Address Fraud in Nonemergency Medical Transportation

GAO – Medicaid
GAO-22-105447, September 28

State Medicaid programs are required to provide nonemergency medical transportation to beneficiaries who are unable to provide their own transportation to medical appointments. Within broad federal guidelines, states have flexibility in how they administer this benefit; GAO found that states used three broad approaches to do so. These approaches included administering the benefit directly (in-house), contracting with third-party transportation brokers or contracting with managed care organizations. Most states used a combination of these approaches.

Congressional Budget Office Releases Report on Opioids

https://www.cbo.gov/publication/58221

The Congressional Budget Office (CBO) report was prepared at the request of the chairman of the House Committee on Energy and Commerce. In keeping with the Congressional Budget Office’s mandate to provide objective, impartial analysis, the report makes no recommendations.

The report states that prescription opioid use continued to fall after three laws were enacted. Opioid-involved deaths increased in most subsequent years before the start of the pandemic, but the annual rate of increase in deaths slowed. Deaths involving opioids increased dramatically during the pandemic, driven by a sharp increase in fatalities involving fentanyl. The rise in opioid-involved deaths may be due to greater demand, as well as to the availability of more potent opioids and an increase in the solitary use of opioids. Policy responses to the pandemic affected the opioid crisis in several ways. In March 2020, certain barriers to OUD treatment were reduced, and the American Rescue Plan Act of 2021 appropriated funds to address the opioid crisis.