I. REGULATIONS, NOTICES, & GUIDANCE

• On January 5, 2016, the Office of Management and Budget (OMB) received for review a final rule from the Centers for Medicare & Medicaid Services (CMS) entitled Covered Outpatient Drugs (CMS-2345-F). The rule had previously been reviewed and released by OMB on December 11, 2015.
• On January 4, 2016, the Department of Health and Human Services (HHS) Office for Civil Rights (OCR) issued a final rule entitled Health Insurance Portability and Accountability Act (HIPAA) Privacy Rule and the National Instant Criminal Background Check System (NICS) to expressly permit certain HIPAA covered entities to disclose to the NICS the identities of individuals who are subject to a Federal “mental health prohibitor” that disqualifies them from shipping, transporting, possessing, or receiving a firearm. The rule specifically prohibits the disclosure of diagnostic or clinical information, from medical records or other sources, and any mental health information beyond the indication that the individual is subject to the Federal mental health prohibitor. This final rule is effective on February 5, 2016.
• On January 8, 2016, HHS announced an extension of the deadline for entities to submit an Essential Community Provider (ECP) Petition and is now accepting petitions from qualified providers until Friday, January 15, 2016, for data corrections and additions to be considered for the 2017 ECP List. For the Marketplace’s 2017 benefit year, CMS released an ECP Petition to collect more complete data from providers who qualify as an ECP and wish to appear on CMS’s ECP list for the 2017 benefit year. The ECP petition is a web-based questionnaire that is available at the following link: https://data.healthcare.gov/cciio/ecp_petition.  
• On January 8, 2016, the Food and Drug Administration (FDA) issued a notice entitled Over-the-Counter Sunscreens -- Safety and Effectiveness Data, extending the comment period provided in the notice entitled "Over-the-Counter Sunscreens: Safety and Effectiveness Data; Draft Guidance for Industry; Availability" that appeared in the Federal Register on November 23, 2015 (80 FR 72975). That notice announced the availability of a draft guidance for industry and requested comments to that draft guidance by January 22, 2016. FDA is extending the draft guidance's comment period by 30 days (to February 22, 2016) in response to a request for an extension to allow interested persons additional time to submit comments.
• On January 5, 2016, the Department of Veterans Affairs (VA) issued a proposed rule entitled Copayments for Medications Beginning January 1, 2017. The VA proposes to amend its regulations concerning copayments charged to certain veterans for medication required on an outpatient basis to treat non-service connected conditions. VA currently charges non-exempt veterans either $8 or $9 for each 30-day or less supply of medication, and under current regulations, a calculation based on the prescription drug component of the Medical Consumer Price Index would be used to determine the copayment amount in future years. This rulemaking would eliminate the formula used to calculate future rate increases and establish three classes of medications, identified as Tier 1, Tier 2, and Tier 3. These tiers would be defined further in the rulemaking and would be distinguished in part based on whether the medications are available from multiple sources or a single source, with some exceptions. Copayment amounts would be fixed and would vary depending upon the class of medication. The following copayment amounts would be effective January 1, 2017: $5 for a 30-day or less supply of a Tier 1 medication, $8 for a 30-day or less supply of a Tier 2 medication, and $11 for a 30-day or less supply of a Tier 3 medication. Comments must be received by the VA on or before March 7, 2016.
• On January 4, 2016, the FDA issued a final order, Effective Date of Requirement for Premarket Approval for Surgical Mesh for Transvaginal Pelvic Organ Prolapse Repair, to require the filing of a premarket approval application (PMA) or notice of completion of a product development protocol (PDP) for surgical mesh for transvaginal pelvic organ prolapse (POP) repair. The FDA simultaneously issued a final order, Obstetrical and Gynecological Devices; Reclassification of Surgical Mesh for Transvaginal Pelvic Organ Prolapse Repair, to reclassify surgical mesh for transvaginal pelvic organ prolapse (POP) repair from class II to class III. FDA is reclassifying these devices based on the determination that general controls and special controls together are not sufficient to provide reasonable assurance of safety and effectiveness for this device, and these devices present a potential unreasonable risk of illness or injury. The Agency is reclassifying surgical mesh for transvaginal POP repair on its own initiative based on new information.
• The FDA also announced an opportunity for public comment on the proposed collection of certain information by the Agency, Draft Guidance for Industry and Review Staff on Target Product Profile--A Strategic Development Process Tool. The draft guidance is intended to provide sponsors and FDA review staff with information regarding target product profiles (TPPs). A TPP can be prepared by a sponsor and then shared voluntarily with the appropriate FDA review staff to facilitate communication regarding a particular drug development program. A Clinical Development Working Group recommended use of a template that provides a summary of drug labeling concepts to focus discussions and aid in the understanding between sponsors and FDA. The resulting TPP is a format for a summary of a drug development program described in terms of labeling concepts. With the TPP, a sponsor specifies the labeling concepts that are the goals of the drug development program, documents the specific studies that are intended to support the labeling concepts, and then uses the TPP to assist in a constructive dialogue with FDA. The draft guidance describes the purpose of a TPP, its advantages, and its optimal use. It also provides information on how to complete a TPP and relates case studies that demonstrate a TPP's usefulness.
• On January 5, 2016, the FDA issued a final order, Obstetrical and Gynecological Devices; Classification of the Intravaginal Culture System, classifying the intravaginal culture system into class II (special controls). The special controls that will apply to the device are identified in this order and will be part of the codified language for the intravaginal culture system’s classification. The Agency is classifying the device into class II (special controls) in order to provide a reasonable assurance of safety and effectiveness of the device. This order is effective January 6, 2016; the classification was applicable on November 2, 2015.
• On January 8, 2016, FDA announced the availability of a draft document entitled Use of Nucleic Acid Tests to Reduce the Risk of Transmission of Hepatitis B Virus from Donors of Human Cells, Tissues, and Cellular and Tissue-Based Products; Draft Guidance for Industry. The draft guidance document provides establishments that make donor eligibility determinations for donors of human cells, tissues, and tissue-based products (HCT/Ps), with recommendations concerning the use of FDA-licensed nucleic acid tests (NAT) in donor testing for hepatitis B virus (HBV) deoxyribonucleic acid (DNA). The draft guidance, when finalized, is intended to supplement previous FDA recommendations to HCT/P establishments concerning donor testing for hepatitis B surface antigen (HBsAg) and total antibody to hepatitis B core antigen (anti-HBc), in the document entitled "Guidance for Industry: Eligibility Determination for Donors of Human Cells, Tissues, and Cellular and Tissue-Based Products (HCT/Ps)" dated August 2007 (2007 Donor Eligibility Guidance).
• On January 6, 2016, the HHS Office of Inspector General (OIG) released a report entitled CMS Could Not Effectively Ensure That Advance Premium Tax Credit Payments Made Under the Affordable Care Act Were Only for Enrollees Who Paid Their Premiums (A-02-14-02025). The OIG determined that CMS could not ensure that advance premium tax credit (APTC) payments made to qualified health plan (QHP) issuers were only for enrollees who had paid their premiums. Specifically, we found that CMS (1) did not have a process in place to ensure that APTC payments were made only for enrollees who had paid their monthly premiums; instead, CMS relied on each QHP issuer to verify that enrollees paid their monthly premiums and to attest that APTC payment information that the issuer reported to CMS was accurate; and (2) had sole responsibility for ensuring that APTC payments were made only for enrollees who had paid their premiums and did not share these data for enrollees with the IRS when making payments. OIG recommended that CMS (1) establish policies and procedures to calculate APTC payments without relying solely on QHP issuers' attestations, including QHP issuer assurances, that enrollees have paid their premiums, and (2) once it implements an automated policy-based payment process to maintain individual enrollee data, consult with the IRS to explore sharing APTC payment data when these payments are made throughout the year in order to allow the IRS to verify the data reported on each individual's Form 1095-A at tax filing time. CMS concurred with the first recommendation and did not indicate concurrence or non-concurrence with the second recommendation.
• On January 6, 2016, the OIG released a Modification of Advisory Opinion 04-15, which modifies Advisory Opinion 04-15, regarding grants provided by a nonprofit, charitable organization to financially-needy patients suffering from specific chronic or life-threatening diseases to defray the costs of prescription drug therapies, and its first modification at Modification of Advisory Opinion 04-15, to reflect guidance issued on May 21 in the Supplemental Special Advisory Bulletin regarding Independent Charity Patient Assistance Programs.
• On January 4, 2016, the OMB received for review a proposed rule from CMS entitled Hospital and Critical Access Hospital (CAH) Changes to Promote Innovation, Flexibility, and Improvement in Patient Care (CMS-3295-P). This proposed rule would update the requirements that hospitals and Critical Access Hospitals (CAHs) must meet to participate in the Medicare and Medicaid programs. These proposals are intended to conform the requirements to current standards of practice and to support improvements in quality of care, reduce barriers to care, and reduce some issues that may exacerbate workforce shortage concerns.
• On January 4, 2016, the Office of Inspector General (OIG) issued the following Advisory Opinions:
  • Advisory Opinion 15-17 (regarding a non-profit, tax-exempt, charitable organization's proposal to provide financial assistance with copayment obligations, health insurance premiums, and insurance deductibles to patients, including Medicare and Medicaid beneficiaries, receiving treatment for [disease state redacted])
  • Advisory Opinion 15-16 (regarding a nonprofit, tax-exempt, charitable organization's proposal to provide assistance with out-of-pocket expenses for outpatient prescription drugs to financially needy insured patients, including, but not limited to, Medicare and Medicaid beneficiaries)
• On January 5, 2016, CMS issued the following updates:
  • R3431CP: Fiscal Year (FY) 2016 Inpatient Prospective Payment System (IPPS) and Long Term Care Hospital (LTCH) PPS Changes
  • R3432CP: 2016 Durable Medical Equipment Prosthetics, Orthotics, and Supplies Healthcare Common Procedure Coding System (HCPCS) Code Jurisdiction List
  • R3433CP: Clinical Laboratory Fee Schedule – Medicare Travel Allowance Fees for Collection of Specimens
  • R217BP: Rural Health Clinic and Federally Qualified Health Center - Medicare Benefit Policy Manual Update
  • R3435CP: Clarification on Patient’s Reason for Visit Necessary to Capture HIPAA Compliant Fields
• On January 6, 2016, the FDA issued a notice entitled Guidance: Regulatory Requirements for Hearing Aid Devices and Personal Sound Amplification Products, reopening the comment period for the draft guidance entitled "Regulatory Requirements for Hearing Aid Devices and Personal Sound Amplification Products." A notice of availability requesting comments on the draft guidance document appeared in the Federal Register of November 7, 2013. The Agency is reopening the comment period to receive updated comments and any new information. Although stakeholders can comment on any guidance at any time, to ensure that the Agency considers a comment on this draft guidance before it begins work on the final version of the guidance, stakeholders should submit either electronic or written comments on the draft guidance by May 6, 2016.
  • The FDA also announced a meeting on Streamlining Regulations for Good Manufacturing Practices for Hearing Aids. The public workshop will be held on April 21, 2016, from 8:30 a.m. to 5 p.m. Submit either electronic or written comments on the public workshop by May 19, 2016.
• HRSA recently posted the December 2015 Update: 340B Price Unavailability - How to Report to HRSA. Manufacturers who participate in Medicaid are required under the 340B statute to enter into an agreement with the Secretary under which the manufacturer must agree to charge a price (“the 340B ceiling price”) that will not exceed the amount determined under a statutory formula when selling covered outpatient drugs to particular covered entities listed in the statute. If a covered entity is unable to purchase a covered outpatient drug at the 340B price, the entity should first contact the wholesaler and/or manufacturer to determine the underlying issue as to why the product is unavailable at the 340B price. Then, if the issue is not resolved by taking such action, covered entities are encouraged to bring these occurrences to the attention of HRSA.
• On January 7, 2016, the OMB received a proposed rule from the Substance Abuse and Mental Health Services Administration (SAMHSA) entitled Increase Number of Patients to which Drug Addiction Treatment Act (DATA)-Waived Physicians Can Prescribe Buprenorphine. This rule is needed to improve the national response to the rise in prescribed opioid misuse and heroin use and related morbidity and mortality by proposing an approach to increasing access to buprenorphine treatment while protecting against diversion. Medication assisted treatment (MAT) using buprenorphine, in combination with counseling and other support services, is one important tool for treating opioid addiction. To address this need and help close the gap in treatment services, SAMHSA would propose to address restrictions in the use of buprenorphine imposed by the Drug Addiction Treatment Act (DATA 2000).

Event Notices

• January 12, 2016: President Obama will deliver his final State of the Union address on January 12, 2016 at 9pm ET. Additional details from the White House can be found here.
• January 14, 2016: CMS has announced a National Training Program Webinar, “Learning Series Webinar.” This webinar will provide an overview of key Medicare dates, including enrollment periods, plan data and Plan Finder updates.
• January 21, 2016: CMS has announced a National Training Program Webinar, “Getting Started: New to CMS Programs?” This webinar will provide an introduction to Medicare, Medicaid, the Children’s Health Insurance Program (CHIP), the Federally-facilitated Health Insurance Marketplace and key resources for these programs.
• March 25, 2016: CMS has announced a public conference to discuss potential improvements to the HHS Risk Adjustment methodology for the 2018 benefit year and beyond. More information on the announcement may be found here.

II. CONGRESSIONAL LEGISLATION & COMMITTEE ACTION

• On January 6, 2016, the House passed legislation (HR 3762, Restoring Americans’ Healthcare Freedom Reconciliation Act) that would have repealed certain provisions of the Affordable Care Act and limited federal funding for Planned Parenthood for a year. The bill was passed by a vote of 240-181. The bill had originally passed the House by a 240-189 vote October 23, 2015. After being amended, it passed the Senate on December 3, 2015 by a 52-47 vote as part of the budget reconciliation process.
  • President Barack Obama vetoed the measure on January 8, 2016. The President’s veto message is available here. The House reportedly plans to hold a veto override debate before January 26, 2016, but does not appear to have the two-thirds majority needed to reverse the veto.
• On January 4, 2016, the Congressional Budget Office (CBO) issued a Cost Estimate of H.R. 3762, Restoring Americans' Healthcare Freedom Reconciliation Act, as passed by the Senate on December 3, 2015, and following enactment of the Consolidated Appropriations Act, 2016. Over the 2016-2025 period, estimated savings are $36 billion larger, without macroeconomic feedback, and $42 billion larger, with macroeconomic feedback, relative to CBO and JCT’s prior estimate for H.R. 3762.
• The GOP Doctors Caucus will reportedly prepare its own ACA replacement bill in the coming weeks, according to caucus co-chair John Fleming. The bill is expected to combine Rep. Tom Price’s Empowering Patients First Act and the Republican Study Committee’s American Health Care Reform Act. “Hopefully, we’ll have a bill that’s 80 to 90 percent completed before it even gets a chance to go through the committees,” Fleming was quoted as saying on Wednesday.

III. REPORTS, STUDIES, & ANALYSES

• On January 8, 2016, CBO released its Monthly Budget Review for December 2015. The federal budget deficit was $212 billion for the first three months of fiscal year 2016, the CBO estimates. That deficit was $36 billion larger than the one recorded during the same period last year. Receipts and outlays were both higher than last year’s amounts, by 4 percent and 7 percent, respectively. If not for shifts in the timing of certain payments (which otherwise would have fallen on a weekend or on New Year’s Day), the deficit for the three-month period would have been $9 billion larger than it was last year.
• On January 5, 2016, the Government Accountability Office (GAO) issued a report entitled DOD and VA Health Care: Actions Needed to Help Ensure Appropriate Medication Continuation and Prescribing Practices (GAO-16-158). GAO found that DOD relies on each military service to review the medication prescribing practices of its providers and that the Army does not monitor the prescribing of medications to treat PTSD on an ongoing basis. Without such monitoring, the Army may be unable to identify and address practices that are inconsistent with the guideline. Federal internal control standards require agencies to have control activities to establish performance measures, implement ongoing monitoring to assess performance, and ensure that the findings of reviews are promptly resolved. GAO recommends that the Army monitor prescribing practices of medications discouraged under the PTSD guideline and that VHA clarify its medication continuation policy. DOD and VHA concurred with the recommendations.
• On January 6, 2016, the Urban Institute released an analysis that found that the top reason uninsured parents remain without coverage has been affordability. The brief suggests that roughly 65 percent of uninsured parents said they couldn't afford insurance. “The next most frequently cited reason was that parents were in transition between different types of coverage (13.7 percent); another 7.1 percent said they did not know how to find information about available options. About 13.0 percent of uninsured parents reported that they do not want coverage.”
• A study in the latest issue of Health Affairs, Premium-Based Financial Incentives Did Not Promote Workplace Weight Loss In A 2013–15 Study, finds that workplace wellness programs using financial incentives do not promote weight loss. Researchers at the University of Pennsylvania gave nearly 200 obese wellness program participants a goal of losing 5 percent of body weight and assigned each participant to receive no incentive, a premium-based incentive, or a separate financial incentive, to see which would lead to the most successful outcome. At twelve months, researchers found no statistically significant differences in mean weight change either between the control group (whose members had a mean gain of 0.1 pound) and any of the incentive groups or among the intervention groups.

IV. OTHER HEALTH POLICY NEWS

• On January 5, 2016, CMS announced a new CMMI funding opportunity – the Accountable Health Communities Model. The Accountable Health Communities Model will support up to 44 bridge organizations, through cooperative agreements, which will deploy a common, comprehensive screening assessment for health-related social needs among all Medicare and Medicaid beneficiaries accessing care at participating clinical delivery sites. The model will test three scalable approaches to addressing health-related social needs and linking clinical and community services – community referral, community service navigation, and community service alignment.
• On January 6, 2016, CMS announced that the Quality of Patient Care Star Ratings Preview Reports are now available in the CASPER folders. These reports contain data that will be publicly reported on the Home Health Compare website in April 2016. The deadline to submit a request to have the star rating data suppressed is January 25, 2016. Please follow the directions laid out in the Preview Reports to submit a suppression request. The October refresh of the Home Health Compare website will occur on January 28th. The data presented on HHC in October will match those presented in the preview reports that were uploaded to CASPER in October. Any questions about these reports can be directed to HomeHealthQualityQuestions@cms.hhs.gov.  
• On January 7, 2016, HHS released updated enrollment figures for the Health Insurance Marketplaces. According to the announcement, more than 11.3 million people are signed up for coverage through the Health Insurance Marketplaces in all 50 states and the District of Columbia. That includes 8.6 million people (76 percent) in the 38 states that use the HealthCare.gov platform through January 2, 2016 and 2.7 million people (24 percent) in the remaining 13 State-based Marketplaces through December 26, 2015.