This Week in Washington: House Energy and Commerce Committee marks up 15 healthcare bills; Senate HELP Committee to hold mark up on primary care bill; CMS concerned over procedural Medicaid coverage terminations

Upcoming Hearings

Congress

House

• House Energy and Commerce Committee Marks Up 15 Healthcare Bills
• House Energy and Commerce Committee Chairmen Send Letter to FDA over Foreign Drug Manufacturing Inspections

Senate

• Senate HELP Committee Marks Up Pandemic and All-Hazards Preparedness and Response Act
• Senate HELP Committee Chairman Introduces Primary Care Bill
• Senate Finance Committee to Consider PBM Legislation on July 26
• Seventeen Senators Send Letter Concerning HIPAA Privacy Regulations
• SUPPORT for Patients and Communities Reauthorization Act of 2023 Introduced
• PBM Oversight Act of 2023 Introduced

Administration

• White House Launches Office of Pandemic Preparedness and Response Policy
• FTC and DOJ Release Draft Merger Guidelines
• CMS Concerned Over Procedural Medicaid Coverage Terminations
• CMS Approves Two Requests for Mobile Crisis Team Behavioral Health Services
• CMS Proposes Medicare Part A and B Coverage for HIV Prophylaxis Drugs
• FDA Approves RSV Monoclonal Antibody Treatment for Infants
• FDA Issues Warning Regarding the Use of Ultrasound Medical Devices
• SAMHSA Announces $47.8 Million in Opioid Use Disorder Program Grant Funding

Other Activity

• McGuireWoods Consulting Telehealth Flexibility Guidance Now Available

Proposed Rules

• CMS Proposed Rule Contains RFI on Episode-based Payment Model
• CMS Proposed Rule Updates CY 2024 Medicare PFS Payments
• CMS Proposed Rule Revises FY 2024 Medicare Hospital OPPS and ASC Payment Systems
• OCR Proposed Rule Reaffirms Federal Discrimination Protections in HHS Grants
• CMS Proposed Rule Updates Medicare Home Health PPS Rates for CY 2024
• CMS Proposed Rule Outlines Remedy to 340B Program Payment Adjustments
• CMS Proposed Rule Modifies Definition of Short-term Health Plans
• CMS Proposed Rule Updates and Revises ESRD PPS for CY 2024
• CMS Proposes Rule to Strengthen Medicaid Drug Price Transparency and Verification
• FDA Proposes Rule to Broaden Prescription Drug Labeling Regulations
• FDA Proposes New Tobacco Product Manufacturing Practices Requirements

Final Rules

• OIG Final Rule Outlines Civil Money Penalty Regulations
• CMS Final Rule Clarifies Medicare DSH Payment Adjustment Part C Days
• CMS Final Rule Eliminates COVID-19 Healthcare Worker Vaccination Requirement
• DEA Releases Temporary Rule Extending COVID-19 Telemedicine Flexibilities
• CMS Finalizes 2024 Medicare Advantage and Part C and D Payment Policies
• FDA Issues Final Rule Regarding Mammography Quality Standards
• FDA Delays Tobacco Product Required Warning Final Rule Effective Date

CBO Cost Estimates

• CBO Publishes Blog Post Requesting New Healthcare Research Information

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Upcoming Hearings

July 26

Senate

Senate Committee on Veterans’ Affairs Full Committee Hearing: “Implementing the PACT Act: One Year Later”
3:00 p.m., Russell Senate Office Building 418
Witnesses to be announced.

July 27

House

House Committee on Oversight and Accountability Select Subcommittee on the Coronavirus Pandemic Hearing: “Because I Said So: Examining the Science and Impact of COVID-19 Vaccine Mandates”
2:00 p.m., Rayburn House Office Building 2154
Witnesses to be announced.

House

House Energy and Commerce Committee Marks Up 15 Healthcare Bills

On July 19, the House Energy and Commerce Committee reported out of committee 15 healthcare bills. The bills are:

• H.R. 824, Telehealth Benefit Expansion for Workers Act of 2023

This legislation would expand COVID-19 telehealth flexibilities issued by the Departments of Health and Human Services (HHS), Labor and the Treasury, and allow employers to offer stand-alone coverage of telehealth-only services to employees.

• H.R. 3226, Prematurity Research Expansion and Education for Mothers who deliver Infants Early (PREEMIE) Reauthorization Act of 2023

This legislation would reauthorization the Prematurity Research Expansion and Education for Mothers who deliver Infants Early (PREEMIE) Act for fiscal years (FYs) 2024 to 2028. It would direct the Centers for Disease Control and Prevention (CDC) and the Health Resources and Services Administration (HRSA) to strengthen efforts to reduce preterm births and infant mortality and would authorize a new study to analyze the financial costs of premature births on society.

• H.R. 3838, Preventing Maternal Deaths Reauthorization Act of 2023

This legislation would reauthorize federal support of state efforts to address disparities that exist in maternal health outcomes. It would require the CDC to work with HRSA to inform hospitals and healthcare providers of maternal mortality prevention strategies.

• H.R. 3843, Action for Dental Health Act of 2023

This legislation would reauthorize Section 340G of the Public Health Service Act to address dental workforce needs.

• H.R. 3884, Sickle Cell Disease and Other Heritable Blood Disorders Research, Surveillance, Prevention, and Treatment Act of 2023

This legislation would reauthorize Section 1106 of the Public Health Service Act for FYs 2024 to 2028 to continue research and treatment services.

• H.R. 3821, Firefighter Cancer Registry Reauthorization Act of 2023

This legislation would reauthorize funding for FYs 2024 to 2028, for a voluntary CDC registry used to report firefighter cancer incidents.

• H.R. 3391, Gabriella Miller Kids First Research Act 2.0

This legislation would reauthorize funding through FY 2028 for the National Institutes of Health (NIH) Gabriella Miller Kids First Pediatric Research Program. It would also enhance the coordination of federal pediatric cancer research efforts and require HHS to report on federally funded pediatric cancer research programs and initiatives.

• H.R. 4421, Preparing for All Hazards and Pathogens Reauthorization Act

This legislation would reauthorize federal programs supporting public health security and all-hazards response, the Biomedical Advanced Research and Development Authority (BARDA), the Public Health Emergency Medical Countermeasures Enterprise (PHEMCE) and the Strategic National Stockpile (SNS). It would also contain provisions aimed at streamlining emergency response authorities and medical countermeasure research and enhancing transparency across federal agencies.

• H.R. 4420, Preparedness and Response Reauthorization Act

This legislation would reauthorize CDC programs that support the distribution of medical countermeasures and the control of biological agents and mosquito-borne diseases. It would also strengthen epidemiological monitoring.

• H.R. 4529, Public Health Guidance Transparency and Accountability Act of 2023

This legislation would require the CDC to implement public participation requirements prior to finalizing and implementing guidance. It would also clarify that CDC guidance is nonbinding.

• H.R. 4381, Public Health Emergency Congressional Review Act

This legislation would establish a congressional review process for a public health emergency (PHE) and would allow Congress to consider and vote on terminating a PHE six months after it was declared.

• H.R. 3813, CDC Leadership Accountability Act of 2023

This legislation would require any director of the CDC appointed by the president on or after June 1, 2023, to be confirmed by the Senate.

• H.R. 3836, Medicaid Primary Care Improvement Act

This legislation would clarify that current Medicaid law does not prohibit state Medicaid programs from using direct primary care to provide services to Medicaid beneficiaries. It would also require the Centers for Medicare and Medicaid Services (CMS) to report to Congress on existing Medicaid primary care contracting arrangements.

• H.R. 4531, Support for Patients and Communities Reauthorization Act

This legislation would reauthorize portions of the Substance Use-Disorder Prevention that Promotes Opioid Recovery and Treatment for Patients and Communities (SUPPORT) Act. It would reauthorize public health programs related to substance use disorder prevention, treatment and recovery and the permanent extension of Medicaid’s required coverage of medication-assisted treatments.

• H.R. 3887, Children’s Hospital GME Support Reauthorization Act

This legislation would reauthorize payments to children’s hospitals that have Graduate Medical Education programs for FYs 2024 to 2028. It would also prohibit payments to children’s hospitals that furnish specified procedures or drugs for minors.

For more information, click here.

House Energy and Commerce Committee Chairmen Send Letter to FDA over Foreign Drug Manufacturing Inspections

On July 18, House Energy and Commerce Committee Chairman Cathy McMorris Rodgers (R-WA), Subcommittee on Health Chairman Brett Guthrie (R-KY) and Subcommittee on Oversight and Investigations Chairman Morgan Griffith (R-VA) sent a letter to Food and Drug Administration (FDA) Commissioner Robert Califf concerning FDA-led foreign drug manufacturing inspections. The FDA recently decided to allow the import of drugs from India and China to alleviate the ongoing U.S. critical drug shortage. The members are concerned that this decision may lead to drug products entering the U.S. that are in violation of FDA safety regulations.

For more information, click here.

Senate

Senate HELP Committee Marks Up Pandemic and All-Hazards Preparedness and Response Act

On July 20, the Senate Health, Education, Labor and Pensions (HELP) Committee marked up and voted in favor of authorizing the Pandemic and All-Hazards Preparedness and Response (PAHPARA) Act. The legislation would improve U.S. biosecurity capabilities and pandemic preparedness and response capabilities among state and federal healthcare agencies. The legislation would:

• Improve planning and coordination efforts among federal agencies during public health emergencies, natural disasters and biological, chemical and nuclear threats;
• Reauthorize the Hospital Preparedness Program;
• Update the National Health Security Strategy, the Annual Threat-Based Review for the Strategic National Stockpile (SNS), the Vaccine Injury Compensation Program (VICP) and the Countermeasures Injury Compensation Program (CICP);
• Encourage the Biomedical Advanced Research and Development Authority (BARDA) to support innovate medical countermeasures and identify virus families with significant pandemic potential; and
• Direct the Government Accountability Office (GAO) to study the economic impact and health outcomes of COVID-19 response strategies.

During the markup, the committee adopted two amendments offered by Sens. Budd (R-NC), Hassan (D-NH) and Hickenlooper (D-CO) that seek to strengthen the SNS and establish an emerging pathogen preparedness program at the Food and Drug Administration (FDA).

For more information, click here.

Senate HELP Committee Chairman Introduces Primary Care Bill

On July 19, Senate Health, Education, Labor and Pensions (HELP) Committee Chairman Bernie Sander (I-VT) introduced the Primary Care and Health Workforce Expansion Act. The legislation would:

• Authorize $86.5 billion in funding for the Community Health Center Fund, the National Health Service Corps, the Children’s Hospital Graduate Medical Education Program, the Teaching Health Center Graduate Medical Education Program, the Primary Care Training and Enhancement Program and other education and loan repayment programs through fiscal year (FY) 2028;
• Require insurance plans to use electronic prior authorization forms;
• Prohibit insurance plans from imposing duplicate prior authorization requirements on patients who switch their health plans while receiving treatment;
• Prohibit hospitals from charging facility fees when patients receive care from off-site physicians;
• Prohibit hospitals and physicians from billing separately for a given service; and
• Cap hospital and physician fees to equal no more than the median amount that health plans and issuers pay for the service in a physician’s office.

The legislation is the Chairman’s response to a bill introduced last week by HELP Committee Ranking Member Bill Cassidy (R-LA) that also seeks to reauthorize various primary care and medical education programs. The Chairman and Ranking Member have been unable to agree on funding levels and negotiations have stalled between their staff. A markup of the Chairman’s bill has been scheduled for July 26.

For more information, click here.

Senate Finance Committee to Consider PBM Legislation on July 26

The Senate Finance Committee will hold a markup on July 26 to consider legislation to reform pharmacy benefit managers (PBM). The legislation builds upon the bipartisan framework released in April and a subsequent draft released by Committee Chair Ron Wyden (D-OR) and Ranking Member Mike Crapo (R-ID).

For more information, click here.

Seventeen Senators Send Letter Concerning HIPAA Privacy Regulations

On July 18, Senate Finance Committee Chairman Ron Wyden (D-OR) and Senate Appropriations Committee Chairman Patty Murray (D-WA) led a group of 17 senators and 28 members of the House of Representatives in sending a letter to Department of Health and Human Services (HHS) Secretary Xavier Becerra. The letter urges HHS to add additional provisions to a proposed rule that HHS issued in April that seeks to strengthen federal privacy requirements under the Health Insurance Portability and Accountability (HIPAA) Act. The members are urging HHS to:

• Require law enforcement agencies to obtain a warrant before requiring doctors, pharmacists and healthcare providers to pass along patient health information (PHI);
• Prohibit PHI from being shared among law enforcement agencies unless it is needed to further an investigation specified in a warrant application; and
• Inform patients when their PHI is shared with law enforcement agencies.

For more information, click here.

SUPPORT for Patients and Communities Reauthorization Act of 2023 Introduced

On July 20, Senate Health, Education, Labor and Pensions (HELP) Ranking Member Bill Cassidy (R-LA) introduced the Substance Use-Disorder Prevention that Promotes Opioid Recovery and Treatment (SUPPORT) for Patients and Communities Reauthorization Act of 2023. The legislation would reauthorize programs that support mental illness and substance use-disorder prevention, treatment and recovery services. It would also:

• Reauthorize programs that support first responder training, child and youth mental health, pregnant and postpartum women, and work-reentry;
• Increase access to treatment for patients with treatment-resistance depression;
• Direct the Food and Drug Administration (FDA) to carry out a review of at-home drug disposal standards and systems;
• Require the Department of Labor (DOL) to report on the 25-year implementation of mental health parity laws;
• Direct the Department of Health and Human Services (HHS) and the Drug Enforcement Administration (DEA) to issue a special registration process for practitioners who prescribe controlled substances via telehealth; and
• Provide guidance to states on how to treat children with serious emotional disturbance and individuals with serious mental illness.

In addition, on July 19 the House Energy and Commerce Committee reported its version H.R. 4531, the Support for Patients and Communities Reauthorization Act out of committee.

For more information, click here.

PBM Oversight Act of 2023 Introduced

On July 20, Sens. Carper (D-DE) and Grassley (R-IA) introduced the PBM Oversight Act of 2023. The legislation would increase oversight over the practices pharmacy benefit managers (PBMs) use to determine which medications are included on drug formularies and would require the Government Accountability Office (GAO) to conduct a study on the practices and report their findings to Congress. It would also require the GAO to study the practices that pharmacy and therapeutic committees use when developing drug formularies under Medicare Part D.

For more information, click here.

Administration

White House Launches Office of Pandemic Preparedness and Response Policy

On July 21, the White House announced that it had established the Office of Pandemic Preparedness and Response Policy (OPPR). The OPPR will be a permanent office within the Executive Office of the President (EOP) and will be responsible for leading and coordinating preparedness and response actions in response to biological threats, pathogens and other public health disruptions. It will be led by Ret. Major General Paul Friedrichs, who currently serves as Special Assistant to the president and Senior Director for Global Health Security and Biodefense at the National Security Council (NSC).

For more information, click here.

FTC and DOJ Release Draft Merger Guidelines

On July 19, the Federal Trade Commission (FTC) and the Department of Justice (DOJ) released 13 draft merger guidelines that seek to prevent anticompetitive mergers and strengthen federal antitrust laws. The guidelines could have a substantial impact on the healthcare industry due to the relatively high number of mergers and acquisitions that occur among healthcare entities.

The 13 guidelines are:

• Mergers should not significantly increase concentration in highly concentrated markets;
• Mergers should not eliminate substantial competition between firms;
• Mergers should not increase the risk of coordination;
• Mergers should not eliminate a potential entrant in a concentrated market;
• Mergers should not substantially lessen competition by creating a firm that controls products or services that its rivals may use to compete;
• Vertical mergers should not create market structures that foreclose competition;
• Mergers should not entrench or extend a dominant position;
• Mergers should not further a trend toward concentration;
• When a merger is part of a series of multiple acquisitions, the agencies may examine the whole series;
• When a merger involves a multi-sided platform, the agencies examine competition between platforms, on a platform or to displace a platform;
• When a merger involves competing buyers, the agencies examine whether it may substantially lessen competition for workers or other sellers;
• When an acquisition involves partial ownership or minority interests, the agencies examine its impact on competition; and
• Mergers should not otherwise substantially lessen competition or tend to create a monopoly.

The FTC and DOJ are seeking public comment on the guidelines and comments will be accepted until Sept. 18, 2023.

For more information, click here.

CMS Concerned Over Procedural Medicaid Coverage Terminations

On July 19, Director of the Centers for Medicare and Medicaid Services (CMS) Center for Medicaid and CHIP Services Daniel Tsai announced that CMS is concerned over the high number of individuals who are losing Medicaid coverage due to procedural reasons in at least 12 states. An estimated 3 million people have lost coverage since April and data indicates that 75 percent of these disenrollments were due to procedural reasons.

According to data CMS released on July 19, nine states have agreed to pause procedural Medicaid terminations. These include DE, ID, IA, ME, MN, MS, NY, WV and WY.

CMS has issued mitigation plans to several states that are in violation of federal Medicaid renewal requirements. Many states were issued mitigation plans because their renewal forms were requesting more information than was necessary to determine eligibility. Approximately 20 states were not allowing beneficiaries to make use of all modalities to renew their coverage, including phone, mail, in-person and online resources. Twenty-six states were issued mitigation plans because they were not conducting renewals ex parte.

In addition, on July 20, CMS Administrator Chiquita Brooks-LaSure sent a letter to employers and health plan sponsors, urging them to extend the special enrollment periods for group health plans beyond the 60-day minimum. The administrator argued that more time will be needed due to the resumption of Medicaid and CHIP renewals.

For more information on the data released by CMS, click here.

For more information on the CMS Administrator’s letter, click here.

CMS Approves Two Requests for Mobile Crisis Team Behavioral Health Services

On July 20, the Centers for Medicare and Medicaid Services (CMS) approved requests submitted by California and Kentucky to provide behavioral health services through mobile crisis intervention teams. The two states will now be able to utilize mobile crisis teams to provide Medicaid services and assist eligible individuals with accessing behavioral health services. Mobile crisis teams are trained to provide rapid response, individual assessment and crisis de-escalation services.

For more information, click here.

CMS Proposes Medicare Part A and B Coverage for HIV Prophylaxis Drugs

On July 12, the Centers for Medicare and Medicaid Services (CMS) released a proposed decision memo that recommends Medicare Part A and B plans cover oral and injectable pre-exposure prophylaxis (PrEP) drugs for HIV. CMS is also proposing that Medicare Part A and B plans:

• Cover the administration of injectable PrEP using antiretroviral drugs;
• Seven individual counseling visits every 12 months including an initial HIV risk assessment; and
• Seven HIV screenings and one hepatitis B screening per year for seniors currently taking PrEP drugs.

Public comments on the proposed coverage policy will be accepted until Aug. 11 and CMS will issue a final national coverage determination (NCD) in October.

For more information, click here.

FDA Approves RSV Monoclonal Antibody Treatment for Infants

On July 17, the Food and Drug Administration (FDA) approved Beyfortus (nirsevimab-alip), a monoclonal antibody drug intended to prevent respiratory syncytial virus (RSV) lower respiratory tract disease in neonates, infants and children up to 24 months of age. The FDA decided to approve the drug after three clinical trials revealed that the incidence of medically attended RSV lower respiratory tract infection was lower among infants who received the drug versus those who received a placebo.

For more information, click here.

FDA Issues Warning Regarding the Use of Ultrasound Medical Devices

On July 17, the Food and Drug Administration (FDA) issued a warning regarding the use of ultrasound medical devices manufactured and distributed by RoyalVibe Health, CellQuicken and Well-Being Reality. The FDA noted that these devices have not been reviewed and is urging medical providers to refrain from using them. The FDA had previously issued a warning letter to the CEO of RoyalVibe Health regarding the marketing of its ultrasound devices without receiving 510(k) clearance and premarket approval (PMA).

For more information, click here.

SAMHSA Announces $47.8 Million in Opioid Use Disorder Program Grant Funding

On July 19, the Substance Abuse and Mental Health Services Administration (SAMHSA) announced that it is awarding $47.8 million to five grant programs devoted to treating opioid and substance use disorders. The five grant programs include:

• The Medication-Assisted Treatment-Prescription Drug and Opioid Addiction Grant Program;
• The Emergency Department Alternatives to Opioid Demonstration Program;
• The Sober Truth on Preventing Underage Drinking (STOP) Act Program;
• The Adult Reentry Program; and
• The State Pilot Grant Program for Treatment for Pregnant and Postpartum Women.

For more information, click here.

Other Activity

McGuireWoods Consulting Telehealth Flexibility Guidance Now Available

McGuireWoods Consulting has compiled a list of all the telehealth flexibilities that were issued during the COVID-19 public health emergency. The list outlines flexibilities relating to physicians, hospitals, home health agencies, and other providers, and displays their current status.

For more information, click here.

Proposed Rules

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.

OCR Proposed Rule Reaffirms Federal Discrimination Protections in HHS Grants

On July 11, the Department of Health and Human Services (HHS) Office for Civil Rights (OCR) and the Office of the Assistant Secretary for Financial Resources (ASFR) released proposed rule that reaffirms federal protections against discrimination in HHS-funded programs and services. The proposed rule would:

• Clarify that discrimination on the basis of sexual orientation and gender identity is prohibited by federal statues administered by HHS;
• Confirm non-discrimination protections in HHS programs as well as services and grants relating to refugee and homelessness assistance, substance abuse treatment and prevention, community mental health, and maternal and child health; and
• Clarify that individuals with religious objections may seek an exemption from or modification of program requirement when appropriate.

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 programs.

Public comments will be accepted until Aug. 29, 2023. For more information, click here.

CMS Proposed Rule Outlines Remedy to 340B Program Payment Adjustments

On July 7, the Centers for Medicare and Medicaid Services (CMS) released a proposed rule that outlines how 340B hospitals will be reimbursed for funds they did not receive due to an adjustment made to the Medicare payment rates for drugs acquired under the 340B program between calendar years (CY) 2018 and 2022. The adjustment was ruled unlawful by the U.S. Supreme Court last year when the Court unanimously agreed that the Department of Health and Human Services (HHS) had exceed its statutory authority by adjusting the Outpatient Prospective Payment System (OPPS) payment rates for 340B hospitals without first conducting a statutorily mandated survey of hospitals’ acquisition costs.

Under the proposed rule:

• CMS would pay back the outstanding reimbursement funds to applicable 340B hospitals in a one-time lump-sum payment. CMS projects this amount to total approximately $10.5 billion.
• CMS would recoup funds from hospitals that received increased rates for non-drug services between CYs 2018 and 2022. CMS plans to do this by adjusting the OPPS conversion factor by minus 0.5 percent beginning in CY 2025. This adjustment would remain in effect for an estimated 16 years or until all overpaid funds are recouped.

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

CMS Proposed Rule Modifies Definition of Short-term Health Plans

On July 7, the Centers for Medicare and Medicaid Services (CMS) released a proposed rule that would amend the definition of short-term, limited duration-insurance (STLDI) plans and modify conditions for hospital indemnity insurance to be considered an excepted benefit in group and individual health insurance markets. The proposed rule would:

• Restrict the length of STLDI plans to three months and implement a maximum coverage period of four months;
• Prohibit issuers from offering STLDI plans to consumers who have previously purchased plans from the same or a different issuer;
• Prohibit fixed indemnity excepted benefits coverage from paying benefits on a per-service basis in the individual market;
• Implement additional payment standards for fixed indemnity excepted benefits coverage in individual and group markets;
• Require that fixed indemnity excepted benefits be offered as independent, non-coordinated coverage; and
• Propose amendments to revise current notice language to clarify the differences between STLDI and fixed indemnity excepted benefits coverage and comprehensive coverage.

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 specified disease-excepted benefits coverage and level-funded plans.

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

CMS Proposed Rule Updates and Revises ESRD PPS for CY 2024

On June 30, the Centers for Medicare and Medicaid Services (CMS) released a proposed rule that updates and revises the End-Stage Renal Disease (ESRD) Prospective Payment System (PPS) for calendar year (CY) 2024. The proposed rule would:

• Increase payment rates for freestanding ESRD facilities by 1.6 percent and hospital-based facilities by 2.6 percent;
• Increase the ESRD PPS base rate to $269.99;
• Implement a transitional pediatric ESRD dialysis add-on payment adjustment for CYs 2024 to 2026;
• Implement a new three-year add-on payment for new renal dialysis drugs and biological products at the end of the Transitional Add-on Payment Adjustment two-year period;
• Waive low-volume payment amount attestation requirements for ESRD facilities that were impacted by disasters and emergencies;
• Create a new adjustment that increases payment to low-volume, geographically isolated and rural ESRD facilities; and
• Codify new quality reporting measures and remove older measures.

Public comments will be accepted until Aug. 25, 2023. For more information, click here.

CMS Proposes Rule to Strengthen Medicaid Drug Price Transparency and Verification

On May 23, the Centers for Medicare and Medicaid Services (CMS) released a proposed rule that seeks to increase the transparency of Medicaid prescription drug costs. The proposed rule would implement new policies in the Medicaid Drug Rebate Program (MDRP) and would revise and modify MDRP administrative provisions and definitions. It would:

• Designate a time limitation on drug manufacturers’ initiating audits with states;
• Clarify and establish requirements for state fee-for-service (FFS) pharmacy reimbursement;
• Codify certain conditions relating to states’ claiming Federal Financial Partnership (FFP) for physician-administered drugs (PADs);
• Clarify requirements for accumulating price concessions when determining best prices;
• Improve drug price verification and transparency through data collection;
• Propose two new contracting requirements between states and their Medicaid managed plans; and
• Revise third-party liability regulation.

Additionally, the proposed rule would require pharmacy benefit managers (PBMs) that contract with Medicaid to disclose the prices they pay for medications, and would establish a Drug Price Verification Survey Process that would require manufacturers and wholesalers of certain high-cost Medicaid drugs to share drug pricing information with CMS.

Public comments will be accepted until July 25, 2023. For more information, click here.

FDA Proposes Rule to Broaden Prescription Drug Labeling Regulations

On May 30, the Food and Drug Administration (FDA) released a proposed rule that would amend human prescription drug product labeling regulations for medication guides. The proposed rule would require prescription drug and biological product applicants to include a new one-page medication guide known as the Patient Medication Information (PMI) along with products that are used, dispensed or administered in an outpatient setting. Blood and blood components transfused in an outpatient setting would also require a PMI. The PMI would include essential information such as the product’s name, important safety information, common side effects and directions for use.

Public comments will be accepted until Nov. 27, 2023. For more information, click here.

FDA Proposes New Tobacco Product Manufacturing Practices Requirements

On March 8, the Food and Drug Administration (FDA) released a proposed rule that would improve the manufacture, design, packing and storage of tobacco products. The proposed rule seeks to ensure that tobacco products comply with the Federal Food, Drug, and Cosmetic (FD&C) Act. The FDA has noted that it will help minimize and prevent tobacco product contamination, as well as inconsistencies in e-cigarette liquid concentrations and labeling. The proposed rule will also:

• Establish tobacco product design and development controls;
• Ensure that tobacco products meet established specifications;
• Crack down on tobacco products that do not meet specifications;
• Require manufacturers to take action in cases of product contamination;
• Require investigations of products that do not meet specifications; and
• Establish the ability to trace all components, ingredients, additives and materials used by tobacco product manufacturers.

Public comments will be accepted until Sept. 6, 2023. For more information, click here.

Final Rules

OIG Final Rule Outlines Civil Money Penalty Regulations

On July 3, the Department of Health and Human Services (HHS) Office of Inspector General (OIG) released a final rule that amends the HHS OIG civil money penalty (CMP) regulations. The final rule outlines penalties that can be imposed against developers of health information technology and health information networks and exchanges if they violate information blocking regulations. The CMPs were authorized under the 21st Century Cures Act. The final rule also modifies 42 CFR parts 1003 and 1005 and adds Cures Act statutory provision language to them.

The rule will go into effect on Aug. 2, 2023. Some provisions will go into effect on Sept. 1, 2023. For more information, click here.

CMS Final Rule Clarifies Medicare DSH Payment Adjustment Part C Days

On June 7, the Centers for Medicare and Medicaid Services (CMS) released a final rule that establishes a policy that governs how the hospital inpatient days of Medicare Part C beneficiaries should be considered when calculating a hospital’s disproportionate share (DSH) payment adjustment. The policy is intended to provide clarity on how Part C days will be treated for DSH calculations that are not governed by the FY 2014 inpatient prospective payment system (IPPS)/long-term care hospital (LTCH) prospective payment system (PPS) final rule.

The rule will go into effect on Aug. 8, 2023. For more information, click here.

CMS Final Rule Eliminates COVID-19 Healthcare Worker Vaccination Requirement

On May 31, the Centers for Medicare and Medicaid Services (CMS) released a final rule that eliminates the COVID-19 vaccination requirement for healthcare workers. The vaccination requirement, which required all staff working in long-term care (LTC) facilities to receive an initial COVID-19 vaccine, was originally proposed in a Nov. 2021 interim final rule. The rule faced a series of legal challenges and officially went into effect in Jan. 2022, following a ruling by the U.S. Supreme Court.

Although the vaccination requirement is eliminated, the final rule will still require LTC facilities to provide education about COVID-19 vaccines and to offer them to residents, clients and staff. CMS announced that it will rely on proposed quality reporting measures to encourage providers to stay up to date on vaccines.

The rule will go into effect on Aug. 4, 2023. For more information, click here.

DEA Releases Temporary Rule Extending COVID-19 Telemedicine Flexibilities

On May 10, the Drug Enforcement Administration (DEA) and the Substance Abuse and Mental Health Services Administration (SAMHSA) released a temporary rule that extends telemedicine flexibilities adopted during the COVID-19 public health emergency (PHE). The temporary rule follows two Notices of Proposed Rulemaking (NPRM) regarding the virtual prescribing of controlled substances that the DEA released in March 2023, which received more than 38,000 public comments. The temporary rule specifically:

• Extends through Nov. 11, 2023, the COVID-19 PHE controlled substance prescribing flexibilities that allow practitioners to prescribe controlled substances via telemedicine without having to evaluate patients in person.
• Implements a one-year grace period through Nov. 11, 2024, for practitioners and patients who have or who develop a telemedicine relationship on or before Nov. 11, 2023. A “telemedicine relationship” is considered to exist if a practitioner has already issued a prescription for a controlled substance to a patient.

The temporary rule will stay in effect through Nov. 11, 2024. For more information, click here.

CMS Finalizes 2024 Medicare Advantage and Part C and D Payment Policies

On March 31, the Centers for Medicare and Medicaid Services (CMS) released a final rule that will finalize the calendar year (CY) 2024 payment policies for the Medicare Advantage (MA) and Medicare Part C and D programs. The final rule implements several changes that were made with regard to the Medicare programs listed above, which are outlined in a Rate Announcement released by CMS. The final rule will:

• Finalize technical changes and updates made to the MA risk adjustment model, which include transitioning the model to reflect International Classification of Diseases 10 (ICD-10) condition categories and updating the model with recent Medicare data years. CMS intends on phasing in the updated model over the next three years.
• Finalize changes to the Medicare Part C and D Star Ratings. CMS will provide a list of the eligible disasters for the extreme and uncontrollable circumstances adjustment and of non-substantive updates made to several measure specifications.

CMS’ rate announcement update reflects a 3.32 percent increase in MA payments, equivalent to approximately $13.8 billion. Additionally, the update reflects a 2.28 percent increase in the MA payment effective growth rate, a 1.24 percent decline in star ratings and a 4.4 percent increase in the MA risk score trend.

The rule will go into effect on Jan. 1, 2024. For more information, click here.

FDA Issues Final Rule Regarding Mammography Quality Standards

On March 9, the Food and Drug Administration (FDA) issued a final rule that updates the regulations implemented by the Mammography Quality Standards Act of 1992. The FDA has decided to update the regulations due to advancements made in mammography technology and information. The final rule will:

• Improve the delivery of mammography services;
• Strengthen communication of healthcare information;
• Require mammography facilities to provide patients with additional health information;
• Ensure the availability of qualified mammography personnel;
• Bolster medical outcome audits;
• Modernize technological aspects of mammography services; and
• Implement enforcement tools to deal with noncompliant facilities.

The rule will go into effect on Sept. 10, 2024. For more information, click here.

FDA Delays Tobacco Product Required Warning Final Rule Effective Date

On Nov. 25, the Food and Drug Administration (FDA), in compliance with an order issued by the U.S. District Court for the Eastern District of Texas, delayed the effective date of a final rule published on March 18, 2020, titled “Tobacco Products; Required Warnings for Cigarette Packages and Advertisements.” The rule, which was originally supposed to go into effect on June 18, 2021, establishes new cigarette health warnings for cigarette packages and advertisements.

The rule will go into effect on Nov. 6, 2023. For more information, click here.

CBO Cost Estimates

CBO Publishes Blog Post Requesting New Healthcare Research Information

On July 19, the Congressional Budget Office (CBO) published a blog post outlining specific healthcare research information that it is requesting to enhance the quality of its work. The CBO stated that it is currently working on topics related to healthcare provider cost structures and long-term healthcare market services and support (LTSS), and that it has discovered significant gaps in the research literature it is relying on.

For more information, click here.