Below is Alston & Bird’s Health Care Week in Review, which provides a synopsis of the latest news in health care regulations, notices, and guidance; federal legislation and congressional committee action; reports, studies, and analyses; and other health policy news.

Week in Review Highlight of the Week:

This week, HRSA issued a request for proposals (RFPs) ahead of executing multiple contract awards as part of an initiative to reform the organ transplant system, and both the House and Senate held hearings related to drug costs and chronic shortages.

I. Regulations, Notices & Guidance

• On February 5, 2024, the Centers for Medicare & Medicaid Services (CMS) issued a notice entitled, Application by DNV Healthcare USA Inc. (DNV) for Continued CMS Approval of its Psychiatric Hospital Accreditation Program. This proposed notice acknowledges the receipt of a deeming application from DNV Healthcare USA Inc. (DNV) for continued CMS approval of its psychiatric hospital accreditation program. The statute requires that within 60 days of receipt of an organization’s complete application, CMS must publish a notice that identifies the national accrediting body making the request, describes the nature of the request, and provides at least a 30-day public comment period.
• On February 5, 2024, the Food and Drug Administration (FDA) issued a notice entitled, Revocation of Two Authorizations of Emergency Use of In Vitro Diagnostic Device for Detection and/or Diagnosis of COVID-19; Availability. FDA is announcing the revocation of the Emergency Use Authorization (EUAs) (the Authorizations) issued to Southern California Permanente Medical Group, for the Kaiser Permanente High Throughput SARS-CoV-2 Assay, that includes the Kaiser Permanente Saliva Home Collection Kit, and Drexel University College of Medicine, for the SARS-CoV-2 DUCoM-PDL Modified Tetracore Assay. FDA revoked the Authorizations under the Federal Food, Drug, and Cosmetic Act (FD&C Act) as requested by the Authorization holder. The revocations, which include an explanation of the reasons for each revocation, are reprinted at the end of this document.
• On February 5, 2024, FDA issued a notice entitled, Reporting Amount of Listed Drugs and Biological Products Under Section 510(j)(3) of the Federal Food, Drug, and Cosmetic Act; Guidance for Industry; Availability. FDA is announcing the availability of a final guidance for industry entitled Reporting Amount of Listed Drugs and Biological Products Under Section 510(j)(3) of the Federal Food, Drug, and Cosmetic Act; Guidance for Industry; Availability. This guidance addresses the process through which registrants of drug establishments should submit reports to FDA on the amount of each listed drug manufactured, prepared, propagated, compounded, or processed for commercial distribution, as required by the FD&C Act. This guidance finalizes the draft guidance of the same title published on November 1, 2021. To allow for the transition of technical updates to the NextGen Portal, FDA will delay implementation of the final guidance until February 26, 2024. The draft guidance will remain available until that date.
• On February 6, 2024, the Department of Health and Human Services (HHS) issued a final rule correction entitled, Health Data, Technology, and Interoperability: Certification Program Updates, Algorithm Transparency, and Information Sharing; Correction. This document corrects technical and typographical errors in the final rule entitled, “Health Data, Technology, and Interoperability: Certification Program Updates, Algorithm Transparency, and Information Sharing” that was published in the Federal Register on January 9, 2024, and has a stated effective date of February 8, 2024.
• On February 6, 2024, the Administration for Community Living (ACL) issued a final rule entitled, Older Americans Act: Grants to State and Community Programs on Aging; Grants to Indian Tribes and Native Hawaiian Grantees for Supportive, Nutrition, and Caregiver Services; Grants for Supportive and Nutritional Services to Older Hawaiian Natives; and Allotments for Vulnerable Elder Rights Protection Activities. ACL issued this final rule to modernize the implementing regulations of the Older Americans Act of 1965 (“the Act” or OAA). These changes advance the policy goals of the Act as articulated by Congress, including increasing equity in service delivery, accountability for funds expended, and clarity of administration for ACL and its grantees. This final rule ultimately facilitates improved service delivery and enhanced benefits for OAA participants, particularly those in greatest economic need and greatest social need consistent with the statute.
• On February 7, 2024, FDA issued a notice entitled, International Drug Scheduling; Convention on Psychotropic Substances; Single Convention on Narcotic Drugs; World Health Organization; Scheduling Recommendations; Butonitazene; 3-Chloromethcathinone; Dipentylone; 2- Fluorodeschloroketamine; Bromazolam; Request for Comments. FDA is providing interested persons with the opportunity to submit written comments concerning recommendations by the World Health Organization (WHO) to impose international manufacturing and distributing restrictions, under international treaties, on certain drug substances. The comments received in response to this notice will be considered in preparing the United States’ position on these proposals for a meeting of the United Nations Commission on Narcotic Drugs (CND) in Vienna, Austria, in March 2024. This notice is issued under the Controlled Substances Act (CSA).
• On February 8, 2024, HHS issued a final rule entitled, Health Resources Priorities and Allocations System (HRPAS). The final rule establishes s standards and procedures by which it may require acceptance and priority performance of certain contracts or orders to promote the national defense over other contracts or orders with respect to health resources. This final rule also sets new standards and procedures by which HHS may allocate materials, services, and facilities to promote the national defense. This rule finalizes the regulations as proposed in the Notice of Proposed Rule Making (NPRM) of August 16, 2023, with minor technical edits based on comments received.
• On February 8, 2024, HHS issued a proposed rule entitled, Regulatory Agenda: Semiannual Regulatory Agenda. The Regulatory Flexibility Act of 1980 and Executive Order (EO) 12866 require the semiannual issuance of an inventory of rulemaking actions under development throughout the Department, offering for public review summarized information about forthcoming regulatory actions.
• On February 9, 2024, HHS issued a proposed rule entitled, Medicare Program: Strengthening Oversight of Accrediting Organizations and Preventing Accrediting Organization Conflict of Interest, and Related Provisions. This proposed rule would set forth a number of provisions to strengthen the oversight of accrediting organizations (AOs) by addressing conflicts of interest, establishing consistent standards, processes and definitions, and updating the validation and performance standards systems. Additionally, this proposed rule would revise the psychiatric hospital survey process, add a limitation on terminated deemed providers and suppliers when reentering the program, and provides technical corrections for End-Stage Renal Disease facilities and Kidney Transplant Programs. This proposed rule also solicits comments from stakeholders and AOs to refine and revise the AO oversight standards and processes. In addition, this proposed rule includes a request for information on the timeframes and expectations for the submission of AO applications.
• On February 9, 2024, HHS issued a rule entitled, Confidentiality of Substance Use Disorder Patient Records. HHS is issuing this final rule to modify its regulations to implement section 3221 of the Coronavirus Aid, Relief, and Economic Security (CARES) Act. HHS is issuing this final rule after careful consideration of all public comments received in response to the notice of proposed rulemaking (NPRM) for the Confidentiality of Substance Use Disorder (SUD) Patient Records. This final rule also makes certain other modifications to increase alignment with the Health Insurance Portability and Accountability Act of 1996 (HIPAA) Privacy Rule to improve workability and decrease burden on programs, covered entities, and business associates.
• On February 9, 2024, FDA issued a rule entitled, Biologics License Applications and Master Files. FDA is issuing a final rule to amend its regulations to address the use of master files by applications licensed under the Public Health Service Act (PHS Act). This final rule codifies FDA’s existing approach that former approved applications for certain biological products under the FD&C Act that have been deemed to be licenses for the biological products under the PHS Act may continue to incorporate by reference drug substance, drug substance intermediate, or drug product (DS/DSI/DP) information contained in a drug master file (DMF) if such information was being referenced at the time the application was deemed to be a license. This final rule also codifies FDA’s general practices regarding the referencing of information in master files by applications licensed under the PHS Act, including applications for combination products licensed under the PHS Act, and by investigational new drug applications (INDs) for products that would be subject to licensure under the PHS Act.

Event Notices

February 13-14, 2024: HHS announced a meeting of the Advisory Committee on Minority Health. The meeting is open to the public. Individuals who wish to attend must register by emailing OMH-ACMH@hhs.gov by 5:00 p.m. EST on January 30, 2024. Each registrant should provide their name, affiliation, phone number, email address, days attending, and if participation is in-person or via webcast.

February 14, 2024: The Centers for Disease Control and Prevention (CDC) announced a meeting of the Advisory Board on Radiation and Worker Health, National Institute for Occupational Safety and Health. This meeting is open to the public, but without a public comment period. The public can join the meeting by teleconference.

February 16, 2024: The National Institutes of Health (NIH) announced a meeting of the NIH Clinical Center Research Hospital Board. This is a hybrid meeting open to the public.

February 22, 2024: HHS announced a meeting of the Presidential Advisory Council on Combating Antibiotic-Resistant Bacteria. This is a hybrid meeting open to the public.

February 22-23, 2024: HHS announced a meeting of the National Vaccine Advisory Committee (NVAC). This is a hybrid meeting open to the public.

February 27, 2024: The Substance Abuse and Mental Health Services Administration (SAMHSA) announced a meeting of SAMHSA’s Tribal Technical Advisory Committee (TTAC). This is a hybrid meeting open to the public.

February 27, 2024: SAMHSA announced a meeting of SAMSHA’s Center for Mental Health Services National Advisory Council. This is a hybrid meeting open to the public.

February 28-29, 2024: The CDC announced a meeting of the Advisory Committee on Immunization Practices. This is a virtual meeting open to the public.

March 5, 2024: HHS announced a meeting of the Vaccines and Related Biological Products Advisory Committee. This is a virtual meeting open to the public.

March 6, 2024: CDC announced a meeting of the Board of Scientific Counselors, National Center for Health Statistics. This meeting is open to the public.

March 7, 2024: The Agency for Healthcare Research and Quality (AHRQ) announced a meeting for Software Developers on the Common Formats for Patient Safety Data Collection. This is a virtual meeting open to the public.

March 13, 2024: NIH announced a meeting of the National Cancer Institute Clinical Trials and Translational Research Advisory Committee. This is a virtual meeting open to the public.

March 13, 2024: CDC announced a meeting of the Board of Scientific Counselors, National Institute for Occupational Safety and Health. This is a virtual meeting open to the public.

March 13, 2024: FDA announced a meeting of the Oncologic Drugs Advisory Committee. This is a virtual meeting open to the public.

March 19, 2024: CDC announced a meeting of the ICD-10 Coordination and Maintenance Committee. This is a virtual meeting open to the public.

March 21, 2024: FDA announced a meeting of the Ophthalmic Devices Panel of the Medical Devices Advisory Committee. This is a virtual meeting open to the public.

March 25-26, 2024: HHS announced a meeting of the Physician-Focused Payment Model Technical Advisory Committee (PTAC). This is a hybrid meeting open to the public.

II. Hearings & Markups

House of Representatives

• On February 6, 2024, the House Ways & Means Committee held a hearing entitled, Examining Chronic Drug Shortages in the United States. Witnesses present included Dr. Stephen Schleicher, MD, MBA, Chief Medical Officer, Tennessee Oncology; Eugene Cavacini, Senior Vice President and Chief Operating Officer, McKesson Pharmaceutical Solutions & Services (PSaS); Allan Coukell, BSc, Senior Vice President for Public Policy, Civica Rx; Dr. Stephen Schondelmeyer, PharmD, PhD, Director of the PRIME Institute, University of Minnesota’s College of Pharmacy; Dr. Julie Gralow, MD, Chief Medical Officer and Executive Vice President, ASCO; and Dr. Jeromie Ballreich, PhD, Associate Research Professor, Johns Hopkins Bloomberg School of Public Health.
• On February 6, 2024, the House Energy & Commerce Committee held a hearing entitled, Protecting American Health Security: Oversight of Shortcomings in the FDA's Foreign Drug Inspection Program. Witnesses present included Dinesh S. Thakur, Public Heath Activist, Thakur Family Foundation, Inc.; John W.M. Claud, Counsel, Hyman, Phelps & McNamara; and Mary Denigan-Macauley, Director of Public Health, Government Accountability Office.
• On February 6, 2024, the House Budget Committee held a markup of H.R. 766, Preventive Health Savings Act; H.R. 7032, Congressional Budget Office Data Sharing Act; and H.R. 5301, Eliminate Useless Reports Act of 2023. H.R. 766, the Preventive Health Savings Act and H.R. 7032, the Congressional Budget Office Data Sharing Act were advanced by a bipartisan vote of 30-0. The markup also featured an amendment to change the short title of H.R. 766 to the Dr. Michael C. Burgess Preventive Health Savings Act to commemorate the honorable service of Representative Burgess to the House Budget Committee. H.R. 5301, the Eliminate Useless Reports Act of 2023 was also passed by a bipartisan vote.

Senate

• On February 8, 2024, the Senate Health, Education, Labor, and Pensions (HELP) Committee held a hearing entitled, Why Does the United States Pay, by Far, the Highest Prices in the World for Prescription Drugs? Witnesses present included Joaquin Duato, Chief Executive Officer, Johnson & Johnson; Robert Davis, Chief Executive Officer, Merck; Chris Boerner, Chief Executive Officer, Bristol Myers Squibb; Peter Maybarduk, J.D., Access to Medicines Director, Public Citizen; Tahir Amin, LL.B., Chief Executive Officer, Initiative for Medicines, Access & Knowledge; and Darius Lakdawalla, Ph.D., Director, Research, University of Southern California Schaeffer Center.
• On February 8, 2024, the Senate Finance Committee held a hearing entitled, Artificial Intelligence and Health Care: Promise and Pitfalls. Witnesses included Peter Shen, Head of Digital & Automation for North America, Siemens Healthineers; Mark Sendak, MD, MPP, Co-Lead, Health AI Partnership; Michelle M. Mello, JD, Ph.D.; Professor of Health Policy and of Law; Stanford University; Ziad Obermeyer, MD, Associate Professor and Blue Cross ff California Distinguished Professor, University of California – Berkeley; and Katherine Baicker, Ph.D., Provost, University of Chicago.

III. Reports, Studies, & Analyses

• On February 6, 2024, the Congressional Budget Office (CBO) issued a cost estimate for the Bipartisan Primary Care and Health Workforce Act (S. 2840). CBO estimates that the bill would increase spending by $3.9 billion in 2024 and $23.1 billion from 2024-2033, primarily driven by extending funding for the Teaching Health Center Graduate Medical Education Program, the National Health Service Corps, and community health centers. Conversely, CBO estimates that the bill would increase revenues by $0 in 2024 and $7.0 billion from 2024 to 2023. As such, the bill would have a net increase in the deficit of $3.9 billion in 2024 and $16.1 billion from 2024-2033. The bill was originally introduced by Senators Bernie Sanders (I-VT) and Roger Marshall (R-KS) in November 2023.
• On February 7, 2024, CBO released a report entitled, The Budget and Economic Outlook: 2024 to 2034. According to report, the federal budget deficit is projected to increase from $1.6 trillion in fiscal year 2024 to $2.6 trillion in 2034. Deficits are expected to grow in relation to the size of the economy, reaching 6.1 percent of GDP by 2025 and returning to that level by 2034, significantly higher than the historical average. The report states that debt held by the public is forecasted to rise each year, reaching 116 percent of GDP by 2034, the highest in the nation's history. Mandatory spending and interest costs are driving up debt, outpacing declines in discretionary spending and revenue growth. Federal outlays are projected to be 23.1 percent of GDP in 2024, increasing to 24.1 percent by 2034, driven by spending on programs benefiting the elderly and rising interest costs. Revenues are expected to be 17.5 percent of GDP in 2024, reaching 17.9 percent in 2027 due to tax provisions expiring. The current projections show a smaller deficit for 2024 compared to previous estimates, with discretionary outlays being the main contributing factor to reduced deficits over the 10-year period.
• On February 8, 2024, the Kaiser Family Foundation (KFF) released a report entitled, Millions of People with Medicare Will Benefit from the New Out-of-Pocket Drug Spending Cap Over Time. The Inflation Reduction Act set a $2,000 out-of-pocket (OOP) cap on annual Medicare Part D beneficiary spending that begins in 2025. To assess how many beneficiaries this would impact, KFF analyzed the OOP spending of Part D beneficiaries in 2021. If the cap had been in effect in 2021, roughly 1.5 million beneficiaries would have seen OOP costs capped. Furthermore, if the cap had been in effect over ten years from 2012 to 2022, over 5 million beneficiaries would have seen savings. The analysis also aggregated findings by state, with California, Florida, and Texas all seeing over 100,000 beneficiaries impacted by the OOP cap in 2021. Given health care and pharmaceutical costs are increasingly rising, even more individuals are likely to be impacted by the OOP cap in 2025.

IV. Other Health Policy News

• On February 6, 2024, the Health Resources and Services Administration (HRSA) announced it is undertaking significant reforms to transform the Organ Procurement and Transplantation Network (OPTN) under President Biden’s American Rescue Plan. This initiative, empowered by new legal authority, aims to enhance patient care and transparency. HRSA is issuing requests for proposals (RFPs) to multiple vendors, to introduce competitive bidding processes to diversify vendor contracts, promoting transparency and accountability in organ matching technology, and targeting disparities in pre-waitlist practices to improve equity. Additionally, he reforms include establishing an independent OPTN Board of Directors, issuing multi-vendor contracts, and enhancing IT infrastructure. A press release with more information is available here.
• The Health Resources and Services Administration (HRSA) is implementing significant changes to the Organ Procurement and Transplantation Network (OPTN) as part of its Modernization Initiative, enabled by new legislative authority. These actions aim to enhance patient care and address systemic issues within the organ transplant system. These measures reflect a commitment to modernizing the organ transplant system for better patient outcomes and management effectiveness.
• On February 7, 2024, the House of Representatives passed H.R. 485, the Protecting Health Care for All Patients Act of 2023, which extends the current ban in Medicare on the use of quality-adjusted life years (QALYs) metrics, which measure the effectiveness of a drug by weighing how many more years of life the medicine could give a patient, and similar metrics to all government health programs, including Medicare Advantage (MA), the Department of Veterans Affairs (VA), and Medicaid. QALYs have been criticized for being discriminatory against people with chronic illnesses and disabilities. The bill passed with a vote of 211-208 without Democratic support because of concerns that the legislation might curb federal drug price negotiations by excluding all comparative effectiveness analysis. The bill now moves to the Senate, where its passage is uncertain because the Biden Administration has signaled its opposition to the measure. The text of the bill is available here.
• On February 8, 2024, HHS, through CMS, approved New Mexico’s proposal to expand access to Medicaid crisis services through community-based mobile crisis intervention teams, making it the 15th state to adopt this option under President Biden’s American Rescue Plan. These teams, comprised of trained behavioral health professionals, provide rapid response and support to individuals in crisis, aiming to integrate behavioral health services into Medicaid programs. By offering immediate care and referrals for ongoing support, these interventions help save lives and reduce the need for costly inpatient services. New Mexico's initiative aligns with the administration’s commitment to transforming mental health services and investing in the nation's crisis continuum of care. A press release with more information is available here.
• On February 9, 2024, U.S. Senators Marsha Blackburn (R-TN), John Thune (R-SD), John Barrasso (R-WY), Debbie Stabenow (D-MI), Mark Warner (D-VA), and Catherine Cortez Masto (D-NV) jointly announced the establishment of a Medicare payment reform working group. This bipartisan initiative aims to investigate and propose long-term reforms to the physician fee schedule (PFS) and make necessary updates to the Medicare Access and CHIP Reauthorization Act (MACRA). Recognizing the evolving landscape of healthcare and the need for payment systems to reflect advancements in care and technology, the group seeks to ensure financial stability for providers, improve patient outcomes, promote access to quality care, and incentivize the use of emerging healthcare technology within Medicare. The working group plans to engage stakeholders for feedback and develop policy solutions to address Medicare physician payment challenges, with a focus on long-term sustainability and quality care for patients.

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