Washington Healthcare Update

July 31, 2023

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This Week in Washington: Senate Finance Committee reports out Modernizing and Ensuring PBM Accountability Act; House Ways and Means Committee reports out healthcare bills; Senate Appropriations Committee reports out FY 2024 Labor-HHS funding bill; Congress leaves for August recess

Upcoming Hearings

Congress

House

Senate

Administration

Proposed Rules

Final Rules

Reports

CBO Cost Estimates

Other

Upcoming Hearings

House

The House has recessed for its August district work period.

Senate

The Senate has recessed for its August state work period.

Congress

House

House Ways and Means Committee Marks Up Two Healthcare Bills

On July 26, the House Ways and Means Committee reported out two healthcare bills on a party line vote. The bills are:

H.R. 4822, the Health Care Price Transparency Act of 2023
This legislation would implement additional site-neutral payment cuts and regulatory measures on off-campus hospital outpatient departments. It would also impose Medicare sequester cuts on hospitals, codify hospital price transparency regulations, require healthcare plans to limit beneficiary cost-sharing for a month’s supply of a drug covered under Medicare Part D, and establish an electronic prior authorization system for Medicare Advantage plans.

H.R. 3284, the Providers and Payers COMPETE Act
This legislation would require the Secretary of Health and Human Services (HHS) to submit an annual report to Congress outlining the effects of Medicare payment rules on provider and payer consolidation. The report would also detail the effects of payer and provider consolidation with respect to Centers for Medicare and Medicaid (CMS) Innovation Center models.

During the markup, the committee rejected four amendments. Among them was an amendment offered by Rep. Pascrell (D-NJ) that would have required the disclosure of hospitals and nursing homes owned by private equity entities.

For more information, click here.

House Energy and Commerce Committee Chairman Issues Drug Shortage Discussion Draft

On July 28, House Energy and Commerce Committee Chairman Cathy McMorris Rodgers (R-WA) released a discussion draft concerning drug shortages. The discussion draft outlines proposals that the committee developed from stakeholder feedback from a request for information (RFI) the Chair and Senate Finance Committee Ranking Member Mike Crapo (R-ID) issued on drug shortages in June.

Among the policy proposals are provisions that would:

  • Exempt certain specified drugs from increases in rebates under the Medicaid program;
  • Implement a cap on total rebates for certain generic drugs;
  • Exempt generic, sterile injection drugs from the 340B Drug Discount Program;
  • Direct the Government Accountability Office (GAO) to study the number of generic drugs that are subject to 340B penny pricing;
  • Direct the Health Resources and Services Administration (HRSA) to issue guidance on preventing drug diversions during shortages;
  • Reduce inflation rebate amounts for certain shortage drugs subject to rebate waivers under the Medicare program;
  • Direct the Department of Health and Human Services (HHS) to study Medicare coding policies for generic sterile injectables and other Part B drugs facing shortages;
  • Strengthen reporting requirements for Group Purchasing Organizations; and
  • Require the Food and Drug Administration (FDA) to issue noncompliance letters relating to drug volume reporting.

The committee is seeking public comment on the draft discussion and will accept comments until Aug. 25, 2023.

For more information, click here.

Senate

Senate Finance Committee Marks Up Modernizing and Ensuring PBM Accountability Act

On July 26, on a 26 to 1 vote, the Senate Finance Committee reported out of committee the Modernizing and Ensuring PBM Accountability (MEPA) Act. The legislation would update federal prescription drug programs and implement provisions aimed at reforming pharmacy benefit manager (PBM) practices. It would:

  • Prohibit PBMs and their affiliates from deriving income or renumeration for Medicare Part D covered drugs based on a manufacturer’s price for the drug;
  • Require PBMs to define and apply drug and drug pricing terms in contracts with Part D plan sponsors in a transparent and consistent manner;
  • Strengthen PBM reporting requirements and expand the amount of information that PBMs provide to Part D plan sponsors and the Secretary of Health and Human Services (HHS);
  • Allow Part D plan sponsors to audit their PBM for compliance with contract requirements;
  • Require the HHS Secretary to implement standard Part D measures to assess network pharmacy performance;
  • Ban PBM spread pricing in the Medicaid program; and
  • Require retail community pharmacies to participate in the National Average Drug Acquisition Cost (NADAC) survey.

For more information, click here.

Senate Appropriations Committee Marks Up FY 2024 Labor-HHS Funding Bill

On July 27, the Senate Appropriations Committee reported out of committee the fiscal year (FY) 2024 Labor, Health and Human Services (HHS) and Education appropriations bill. The legislation would authorize $224.4 billion in total discretionary funding, of which $117 billion would go to the Department of Health and Human Services (HHS). In addition, it included $2 billion in supplemental funding. The bill would:

  • Authorize $47.8 billion in funding for the National Institutes of Health (NIH);
  • Authorize $5 billion in funding for opioid and substance use disorder treatment and prevention programs;
  • Authorize $1.5 billion in funding for the NIH Advanced Research Projects Agency for Health (ARPA-H);
  • Authorize $3.67 billion in funding for the Administration for Strategic Preparedness and Response (ASPR);
  • Retain funding for the Teen Pregnancy Prevention Program;
  • Increase funding for the Ending the HIV Epidemic Initiative;
  • Increase funding for childcare and mental health programs; and
  • Award $2 billion in additional emergency funding to HHS.

For more information, click here.

Senate HELP Committee Chairman Cancels Two Days of Mark Ups

On July 26 and 27, the Senate Health, Education, Labor and Pensions (HELP) Committee was scheduled to mark up legislation relating to primary care, health workforce development, and job and apprenticeship programs. However, both markups were canceled by committee Chairman Bernie Sanders (I-VT). Ranking Member Bill Cassidy (R-LA) raised concerns about the postponements.

The bills that were scheduled to be marked up include:

Primary Care and Health Workforce Expansion Act
This legislation would authorize $86.5 billion in funding for various health workforce development programs, including the National Health Service Corps and the Primary Care Training and Enhancement Program. It would also implement new prior authorization requirements, prohibit hospitals from charging facility fees when patients receive care from off-site physicians and place a cap on hospital and physician fees.

National Apprenticeship Act of 2023
This legislation would support the creation and expansion of registered, youth and pre-apprenticeship programs. It would also grant the Department of Labor Office of Apprenticeship (OA) additional statutory authority to support state apprenticeship programs and agencies.

Youth Apprenticeship Advancement Act
This legislation would support the expansion of youth apprenticeship opportunities available to high school students and would authorize an investment of $500 million in youth apprenticeship programs over the next five years.

JOBS Act of 2023
This legislation would expand Pell Grant eligibility to students who are enrolled in short-term job training programs that result in their obtaining industry-recognized credentials and certificates.

Gateway to Careers Act of 2023
This legislation would create a grant program aimed at strengthening job training. The grant program would support workforce partnerships established among community colleges, industry stakeholders and other community organizations.

For more information on the primary care legislation markup, click here.

For more information on the job and apprenticeship program legislation markup, click here.

Administration

CMS Releases Medicaid and CHIP Coverage Renewal Data

On July 28, the Centers for Medicare and Medicaid Services (CMS) released data on ongoing Medicaid and Children’s Health Insurance Program (CHIP) coverage renewals. The data revealed that 715,000 people lost their Medicaid coverage in April and 500,000 renewals remain pending. Approximately 80 percent of disenrollments have occurred due to procedural reasons, and nearly half of renewals were conducted on an ex parte basis.

For more information, click here.

CMS Releases Medicaid and CHIP Mental Health and SUD Action Plan Overview and Guide

On July 25, the Centers for Medicare and Medicaid Services (CMS) released the Medicaid and Children’s Health Insurance Program (CHIP) Mental Health (MH) and Substance Use Disorder (SUD) Action Plan overview and guide. The overview and guide outline the strategies CMS is using to improve treatment and support of enrollees with these conditions. CMS is primarily focused on increasing access to prevention and treatment services, expanding home- and community-based services and coverage of non-traditional services and settings, and improving the quality of care for MH and SUD conditions.

For more information on the action plan overview, click here.

For more information on the action plan guide, click here.

CMS Updates Overall Hospital Quality Star Ratings

On July 26, the Centers for Medicare and Medicaid Services (CMS) updated the overall hospital quality star ratings on the CMS Care Compare website. The Care Compare website allows patients and caregivers to compare hospitals and access information on more than 100 quality measures. For the first time, CMS has included Veterans Health Administration (VA) hospitals in its annual quality star ratings update.

For more information, click here.

CMS Issues Civil Monetary Penalties Over Hospital Price Transparency Non-Compliance

On July 25, the Centers for Medicare and Medicaid Services (CMS) announced that it had imposed civil monetary penalties on three hospitals that were not complying with the Hospital Price Transparency Final Rule that went into effect on Jan. 1, 2021. The final rule requires all hospitals to disclose the standard charges for items and services they provide.

For more information, click here.

FDA Approves Second OTC Naloxone Nasal Spray

On July 28, the Food and Drug Administration (FDA) approved RiVive, an over-the-counter (OTC) naloxone hydrochloride nasal spray intended to reverse a known or suspected opioid overdose. This is the second OTC naloxone nasal spray to be granted FDA approval. The FDA decided to grant RiVive approval after data showed that it was as effective as an approved prescription naloxone product.

For more information, click here.

FDA Releases Draft Guidance on Opioid Use Disorder Device Innovation

On July 27, the Food and Drug Administration (FDA) Center for Devices and Radiological Health (CDRH) released draft guidance outlining how clinical studies for devices seeking to treat opioid use disorder (OUD) should be designed to support marketing submissions. The draft guidance recommends that stakeholders control for bias, monitor drug use, conduct follow-up studies and evaluate participant retention and data analysis plans. The FDA is seeking comments on the draft guidance and will accept them until Oct. 26.

For more information, click here.

FDA Approves Warfarin Therapy Reversal Drug

On July 21, the Food and Drug Administration (FDA) approved Balfaxar (prothrombin complex concentrate, human-lans), a drug intended to rapidly restore the blood coagulation factor in adult patients undergoing vitamin K antagonist and warfarin therapy before an urgent surgical or invasive procedure.

Patients undergoing warfarin therapy are at significant risk of experiencing heavy bleeding during invasive procedures. Balfaxar seeks to reduce this risk by replenishing the levels of blood clotting factors in patients. The FDA decided to grant the drug approval after a randomized, double-blind, multicenter study showed that the drug had a similar efficacy rate as its comparator drug Kcentra.

For more information, click here.

FDA Approves Pediatric Pulmonary Artery Stenosis Stent

On July 21, the Food and Drug Administration (FDA) approved the Cordis Palmaz Mullins XD Pulmonary Stent. The stent is intended to treat pediatric patients who are receiving treatment for pulmonary artery stenosis (PAS), a heart condition in which the pulmonary artery narrows and prevents normal blood flow.

For more information, click here.

FDA Approves Anthrax Post-Exposure Vaccine

On July 20, the Food and Drug Administration (FDA) approved Cyfendus (anthrax vaccine adsorbed, adjuvanted), a vaccine intended to be administered to patients 18 to 65 years old following suspected or confirmed exposure to Bacillus anthracis. The FDA is recommending that the vaccine be administered in conjunction with other recommended antibacterial drugs.

For more information, click here.

HRSA Awards $11 Million Toward Healthcare Workforce Residency Programs

On July 26, the Health Resources and Services Administration (HRSA) announced that it had awarded $11 million toward programs focused on implementing medical residency programs in rural communities. The funding is intended to help address the shortage of medical health professionals and lack of access to care in rural areas.

For more information, click here.

Proposed Rules

CMS Proposed Rule Strengthens Coverage of Mental Health Insurance Benefits

On July 25, the Centers for Medicare and Medicaid Services (CMS) released a proposed rule that would implement amendments relating to the Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA). The proposed rule would:

  • Clarify that the MHPAEA ensures an individual’s right to access mental health and substance use disorder benefits in parity with medical/surgical benefits;
  • Provide examples that make clear that plans and issuers may not use restrictive prior authorization and other medical management techniques or standards related to network composition for mental health and substance use disorder benefits;
  • Clarify that certain factors may not be used to determine out-of-network reimbursement rates for mental health and substance use disorder providers;
  • Require plans and issuers to gather and analyze outcomes data and take action to resolve material differences in access to mental health and substance use disorder benefits and medical/surgical benefits;
  • Codify a requirement that directs plans and issuers to conduct meaningful comparative analyses to measure the impact of nonquantitative treatment limitation (NQTL); and
  • Implement a sunset provision adopted in the Consolidated Appropriations Act of 2023, that allows self-funded, non-federal government plan elections to opt out of compliance with MHPAEA.

In addition to CMS, the Internal Revenue Service and the Employee Benefits Security Administration are proposing the rule. The agencies are also seeking comment and information on proposed new data requirements for limitations related to the composition of a health plan’s or issuer’s network.

Public comments will be accepted until Oct. 2, 2023. For more information, click here.

CMS Proposed Rule Contains RFI on Episode-based Payment Model

On July 14, the Centers for Medicare and Medicaid Services (CMS) released a proposed rule that seeks comment through a request for information (RFI) on the design of a future CMS Center for Medicare and Medicaid Innovation episode-based payment model. The Center is considering designing and implementing a new episode-based payment model that would focus on healthcare equity, quality and costs. The Center is seeking information from individuals who have experience with bundled payments and noted that responses to the RFI may be used to inform potential future rulemaking and policy development.

Public comments will be accepted until Aug. 17, 2023. For more information, click here.

CMS Proposed Rule Updates CY 2024 Medicare PFS Payments

On July 13, the Centers for Medicare and Medicaid Services (CMS) released a proposed rule that updates the Medicare physician fee schedule (PFS) payment rates for calendar year (CY) 2024. The proposed rule would:

  • Decrease the conversion factor by 3.34 percent to $32.75;
  • Delay implementation of a policy that defines the substantive portion of a split or shared visit based on the amount of time spent by a billing practitioner;
  • Create a new benefit category for marriage and family therapists and mental health counselors under Medicare Part B;
  • Establish new payment codes for mobile psychotherapy for crisis services;
  • Implement five new optional Merit-based Incentive Payment System Value Reporting Pathways; and
  • Extend several telehealth waivers.

Public comments will be accepted until Sept. 11, 2023. For more information, click here.

CMS Proposed Rule Revises FY 2024 Medicare Hospital OPPS and ASC Payment Systems

On July 13, the Centers for Medicare and Medicaid Services (CMS) released a proposed rule concerning the Medicare hospital Outpatient Prospective Payment System (OPPS) and the Medicare Ambulatory Surgical Center (ASC) payment system for fiscal year (FY) 2024. The proposed rule would:

  • Increase OPPS payment rates for hospitals that meet applicable quality reporting requirements by 2.8 percent. This is based off of a projected hospital market basket percentage increase of 3.0 percent minus a 0.2 percent productivity adjustment;
  • Update the productivity-adjusted hospital market basket update factor to ASC rates by 2.8 percent and extend its application through calendar years (CYs) 2024 and 2025;
  • Establish the Intensive Outpatient Program (IOP) under Medicare and implement various IOP service provisions;
  • Update partial hospitalization program (PHP) Medicare payment rates;
  • Strengthen hospital price transparency;
  • Adopt and codify several standard quality program reporting policies; and
  • Expand access to behavioral healthcare and promote safe and effective patient-centered care.

Public comments will be accepted until Sept. 11, 2023. For more information, click here.

CMS Proposed Rule Updates Medicare Home Health PPS Rates for CY 2024

On July 10, the Centers for Medicare and Medicaid Services (CMS) released a proposed rule that updates the Medicare Home Health Prospective Payment System (PPS) rates for calendar year (CY) 2024. The proposed rule would:

  • Apply a permanent PPS adjustment of negative 5.653 percent;
  • Cut reimbursement rates for home health providers by 2.2 percent;
  • Add and remove quality measures from the Home Health quality reporting program;
  • Codify requirements for negative wound therapy;
  • Establish regulations and implement the items and services payment for lymphedema compression treatment and home intravenous globulin services;
  • Address concerns about unnecessary utilization, costs and care quality; and
  • Add an informal dispute resolution (IDR) and special focus program (SFP) for hospice