Washington Healthcare Update - August 2021 #4

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This week in Washington: House passes budget resolution with compromise, setting up a September deadline for infrastructure bill vote.

Congress

House

  • House Passes Budget Resolution
  • Reps. Kuster and McKinley Request a New Formulary Tier for Generics and Biosimilars

Administration

  • Robert Gordon Nominated for HHS Assistant Secretary for Financial Resources
  • FDA Issues Full Approval on Pfizer COVID-19 Vaccine
  • FDA to Launch Pilot Program to Increase Speed of Drug Reviews
  • FDA to Hold Meeting on PDUFA Reauthorization
  • FDA Denies Marketing Applications for 55,000 Flavored E-Cigarette Products
  • CMS Increases Medicare Reimbursement for At-Home COVID-19 Vaccines
  • CMS Announces Increased Savings for Medicare and Accountable Care Organizations
  • $19 Million in Telehealth Grants Announced

Proposed Rules

  • CMS Issues Proposed Rule to Reassign Medicaid Provider Claims
  • CMS Issues Calendar Year 2022 Medicare Hospital Outpatient Prospective Payment System Proposed Rule
  • CMS Issues CY 2022 Medicare Physician Fee Schedule Proposed Rule
  • CMS Issued Proposed Rule for End-Stage Renal Disease Prospective Payment System
  • CMS Proposes 2022 Home Health Prospective Payment System Rate Update

Final Rules

  • CMS Issues Final Rule on Prospective Payment System and Consolidated Billing for Skilled Nursing Facilities
  • CMS Issues Final Rule on Inpatient Rehabilitation Facility Prospective Payment System
  • CMS Issues Final Rule on Inpatient Psychiatric Facilities Prospective Payment System
  • CMS Issues Final Rule on Hospice Wage Index and Payment Rate Update
  • CMS Issues Final Rule for Long-Term Care Hospital Quality Reporting Program

Courts

  • Federal Judge Blocks CMS From Rescinding Texas Medicaid Waiver
  • U.S. Chamber of Commerce Drops Lawsuit on Drug Price Transparency

Congress

House

House Passes Budget Resolution

On Aug. 24, the House voted 220-212 to pass a $3.5 trillion budget resolution and also advanced a $1 trillion bipartisan infrastructure bill. The vote allows Democrats to write and approve the spending package without Republican support.

This vote came after House leadership compromised with centrist Democrats by agreeing to a Sept. 27 deadline for the infrastructure bill vote. The reconciliation instructions make way for health care measures such as extending the Affordable Care Act (ACA) tax credits, expanding Medicare benefits and closing the Medicaid coverage gap. The resolution assumes these measures will be paid for by drug pricing reforms.

Reps. Kuster and McKinley Request a New Formulary Tier for Generics and Biosimilars

On Aug. 25, Reps. Annie Kuster (D-NH) and David McKinley (R-WV) wrote to the Centers for Medicare and Medicaid Services (CMS) requesting the creation of a preferred formulary tier just for generics and biosimilars. In addition, the representatives asked CMS to set a lower coinsurance for the specialty generic and biosimilar tier, and that brand drugs be prohibited from the specialty tier.

The letter can be found here.

Administration

Robert Gordon Nominated for HHS Assistant Secretary for Financial Resources

On Aug. 18, President Biden announced the nomination of Robert Gordon for assistant secretary for financial resources at the Department of Health and Human Services (HHS). Gordon previously served as the director of HHS for the state of Michigan and acting assistant secretary of the Department of Education.

FDA Issues Full Approval on Pfizer COVID-19 Vaccine

On Aug. 23, the Food and Drug Administration (FDA) approved Pfizer’s two-dose COVID-19 vaccine for individuals age 16 and up. This marks the first full approval of a COVID-19 vaccine. Acting FDA Administrator Janet Woodcock stated that she hopes the approval will increase public confidence in the vaccine’s safety and efficacy. The decision was made based on the results of a clinical trial that followed vaccine and placebo recipients for at least six months.

HHS to Require Staff Receive COVID-19 Vaccines

On Aug. 12, Secretary of the Department of Health and Human Services (HHS) Xavier Becerra announced that the department would require its workforce to get vaccinated against COVID-19. This requirement will also apply to staff at the Indian Health Service (IHS) and the National Institutes of Health (NIH), as well as to employees, contractors, trainees and volunteers who come into contact with patients.

FDA to Launch Pilot Program to Increase Speed of Drug Reviews

In its Aug. 23 fiscal 2023-2027 prescription drug user fee commitment letter, the Food and Drug Administration (FDA) stated it will create a pilot program to expedite reviews and approvals for novel uses of existing therapies. The pilot program, titled “Through the Split Real-Time Application Review,” will launch in 2023. The FDA hopes the program will allow for reviews of existing therapies to meet unmatched medical needs.

The letter can be found here.

FDA to Hold Meeting on PDUFA Reauthorization

On Aug. 23, the Food and Drug Administration (FDA) announced that it would be holding a virtual meeting on Sept. 28 to discuss proposed recommendations for the reauthorization of the Prescription Drug User Fee Act (PDUFA) for fiscal years 2023-2027. PDUFA authorizes the FDA to collect user fees that support the agency’s ability to review new medications. The current PDUFA authorization known as PDUFA VI will expire in Sept. 2022.

The meeting will be an opportunity for stakeholders to provide their views on recommended enhancements to the reauthorization. Public comments will be accepted until Oct. 28.

Registration for the event can be found here.

FDA Denies Marketing Applications for 55,000 Flavored E-Cigarette Products

On Aug. 26, the Food and Drug Administration (FDA) issued marketing denial orders (MDOs) for 55,000 flavored electronic nicotine delivery system (ENDS) products, citing insufficient evidence that the products provide a benefit to adult smokers that outweighs the risk posed by youth use.

The press release can be found here.

CMS Increases Medicare Reimbursement for At-Home COVID-19 Vaccines

On Aug. 24, the Centers for Medicare and Medicaid Services (CMS) announced that it would be increasing the reimbursement for at-home COVID-19 vaccines administered to multiple residents in one home setting or in a communal home setting. Medicare reimburses providers $40 for each dose of a COVID-19 vaccine, with an additional $35 for each dose provided in the home starting June 8. The new increase will increase the reimbursement amount by an additional $35.

CMS Announces Increased Savings for Medicare and Accountable Care Organizations

On Aug. 25, the Centers for Medicare and Medicaid Services (CMS) announced $1.9 billion in Medicare savings and $2.3 billion for accountable care organization in 2020 from the Medicare Shared Savings Program.

$19 Million in Telehealth Grants Announced

On Aug. 18, the Biden administration announced that 36 academic medical centers and telehealth resource centers will receive $19 million to strengthen telehealth in rural and underserved areas. The funding will be split between four programs, with $6.5 million going to telehealth centers of excellence, $4.55 million to 14 national telehealth resource centers, $4.28 million to nine academic medical centers to build telemonitoring programs and $3.85 million to the Evidence-Based Direct to Consumer Telehealth Network Program to assess telehealth impact.

Proposed Rules

CMS Issues Proposed Rule to Reassign Medicaid Provider Claims

On July 30, the Centers for Medicare and Medicaid Services (CMS) released a proposed rule titled “Medicaid Program; Reassignment of Medicaid Provider Claims.” The proposed rule would explicitly authorize states to make payments to third parties to benefit individual practitioners by ensuring health and welfare benefits, training, and other benefits customary for employees, if the practitioner consents to such payments to third parties on the practitioner’s behalf.

Comments will be accepted until Sept. 28.

The proposed rule can be found here.

CMS Issues Calendar Year 2022 Medicare Hospital Outpatient Prospective Payment System Proposed Rule

On July 19, the Centers for Medicare and Medicaid Services (CMS) issued a proposed rule titled “Calendar Year (CY) 2022 Medicare Hospital Outpatient Prospective Payment System (OPPS) and Ambulatory Surgical Center (ASC) Payment System Proposed Rule.” CMS is required by the Jan. 2021 Hospital Price Transparency Final Rule to update Medicare payment policies for OPPS hospitals and ASCs on an annual basis. In the proposed rule, CMS proposes several changes aimed at increasing compliance and reducing hospital burden. These changes include setting a minimum civil monetary penalty (CMP) of $300 a day that would apply to smaller hospitals and apply a $10/bed/day charge for hospitals with a bed count over 30, not to exceed a daily amount of $5,500. The minimum total penalty amount for a full year of noncompliance would be $109,500 per hospital, and the maximum total penalty amount would be $2,007,500 per hospital.

CMS is seeking input on how to make data on health disparities based on social risk factors more comprehensive. The proposed rule includes a request for information (RFI) to seek public input on establishing rural emergency hospitals (REHs). CMS is also proposing changes to the Radiation Oncology (RO) Model and halting the elimination of the inpatient-only list. The final rule will be published in early November.

Comments will be accepted until Sept. 17.

The fact sheet on the proposed rule can be found here.

The proposed rule can be found here.

CMS Issues CY 2022 Medicare Physician Fee Schedule Proposed Rule

On July 13, the Centers for Medicare and Medicaid Services (CMS) issued a proposed rule titled “Calendar Year (CY) 2022 Medicare Physician Fee Schedule Proposed Rule.” The proposed rule includes policy changes for Medicare payments under the Physician Fee Schedule (PFS) and would continue the coverage of Medicare telehealth services through the end of 2023, among other changes.

The proposed CY 2021 PFS conversion factor is $33.58, a decrease from the CY 2021 factor of $34.89. The proposed rule would also waive the provider enrollment Medicare application fee for organizations that apply as a Medicare Diabetes Prevention Program (MDPP) supplier on or after Jan. 1, 2022. In the proposed rule, CMS requests feedback on how to best update pay rates for the administration of preventive vaccines covered under Part B and whether to assign certain Section 505(b)(2) drug products to existing multiple source codes.

Comments will be accepted until Sept. 13, 2021.

The proposed rule can be found here.

The fact sheet for the rule can be found here.

For additional information on the proposed rule, click here.

CMS Issued Proposed Rule for End-Stage Renal Disease Prospective Payment System

On July 1, the Centers for Medicare and Medicaid Services (CMS) published a proposed rule titled “End-Stage Renal Disease Prospective Payment System, Payment for Renal Dialysis Services Furnished to Individuals with Acute Kidney Injury, End-Stage Renal Disease Quality Incentive Program, and End-Stage Renal Disease Treatment Choices Model.” The proposed rule would update payment rates under the End-Stage Renal Disease (ESRD) Prospective Payment System (PPS) for renal dialysis services starting Jan. 1, 2022. The rule also would update the acute kidney injury (AKI) dialysis payment rate for renal dialysis services and the ESRD Treatment Choices (ETC) Model.

Comments will be accepted until Aug. 31, 2021.

The proposed rule can be found here.

A CMS fact sheet on the proposed rule can be found here.

CMS Proposes 2022 Home Health Prospective Payment System Rate Update

On June 28, the Centers for Medicare and Medicaid Services (CMS) published a proposed rule titled “Calendar Year (CY) 2022 Home Health Prospective Payment System Rate Update.” The rule would expand the Home Health Value-Based Purchasing (HHVBP) Model. In addition, the rule would update the Medicare Home Health Prospective Payment System (HH PPS) and the home infusion therapy services payment rates for CY 2022. In addition, the proposed rule would also make permanent changes to the home health Conditions of Participation (CoP) implemented during the COVID-19 public health emergency.

Comments will be accepted until Aug. 27.

The proposed rule can be found here.

The CMS Fact Sheet on the rule can be found here.

Final Rules

CMS Issues Final Rule on Prospective Payment System and Consolidated Billing for Skilled Nursing Facilities

On July 29, the Centers for Medicare and Medicaid Services (CMS) released a final rule titled “Prospective Payment System and Consolidated Billing for Skilled Nursing Facilities; Updates to the Quality Reporting Program and Value-Based Purchasing Program for Federal Fiscal Year 2022; and Technical Correction to Long-Term Care Facilities Physical Environment Requirements.” The final rule updates the payment rates used under the prospective payment system (PPS) for skilled nursing facilities (SNFs) for fiscal year (FY) 2022. In addition, the final rule includes a forecast error adjustment for FY 2022, updates the diagnosis code mappings used under the Patient Driven Payment Model (PDPM), rebases and revises the SNF market basket, implements a recently enacted SNF consolidated billing exclusion along with the required proportional reduction in the SNF PPS base rates and includes a discussion of a PDPM parity adjustment. The regulations are effective Oct. 1, 2021.

The final rule can be found here.

CMS Issues Final Rule on Inpatient Rehabilitation Facility Prospective Payment System

On July 29, the Centers for Medicare and Medicaid Services (CMS) released a final rule titled “Inpatient Rehabilitation Facility Prospective Payment System for Federal Fiscal Year 2022 and Updates to the IRF Quality Reporting Program; Payment for Complex Rehabilitative Wheelchairs and Related Accessories (Including Seating Systems) and Seat and Back Cushions Furnished in Connection with Such Wheelchairs.” The final rule provides updates to and finalized proposals for the fiscal year (FY) 2022 Inpatient Rehabilitation Facilities Quality Reporting Program (IRF QRP). This rule includes one new finalized measure, the COVID-19 Vaccination Coverage among Healthcare Personnel (HCP) Measure, as well as an update to the specifications for the Transfer of Health (TOH) Information to the Patient-Post-Acute Care Quality Measure. The rule will go into effect on Oct. 1, 2021.

The final rule can be found here.

CMS Issues Final Rule on Inpatient Psychiatric Facilities Prospective Payment System

On July 29, the Centers for Medicare and Medicaid Services (CMS) released a final rule titled “FY 2022 Inpatient Psychiatric Facilities Prospective Payment System and Quality Reporting Updates for Fiscal Year Beginning October 1, 2021 (FY 2022).” The rule updates the prospective payment rates, the outlier threshold and the wage index for Medicare inpatient hospital services provided by inpatient psychiatric facilities (IPF), which include psychiatric hospitals and excluded psychiatric units of an acute care hospital or critical access hospital.

The final rule can be found here.

CMS Issues Final Rule on Hospice Wage Index and Payment Rate Update

On July 29, the Centers for Medicare and Medicaid Services (CMS) released a rule titled “FY 2022 Hospice Wage Index and Payment Rate Update, Hospice Conditions of Participation Updates, Hospice and Home Health Quality Reporting Program Requirements.” The final rule updates the hospice wage index, payment rates and aggregate cap amount for fiscal year 2022. In addition, this rule makes changes to the labor shares of the hospice payment rates and finalizes clarifying regulations text changes to the election statement addendum that was implemented on Oct. 1, 2020. The regulations are effective on Oct. 1, 2021.

The final rule can be found here.

CMS Issues Final Rule for Long-Term Care Hospital Quality Reporting Program

On Aug. 2, the Centers for Medicare and Medicaid Services (CMS) issued a final rule titled “Hospital Inpatient Prospective Payment Systems for Acute Care Hospitals and the Long Term Care Hospital Prospective Payment System and Policy Changes and Fiscal Year (FY) 2022 Rates; Quality Programs and Medicare Promoting Interoperability Program Requirements for Eligible Hospitals and Critical Access Hospitals; Changes to Medicaid Provider Enrollment; and Changes to the Medicare Shared Savings Program.” The rule will update and finalize proposals for the FY 2022 Long Term Care Hospital Quality Reporting Program and includes the new COVID-19 Vaccination Coverage among Healthcare Personnel (HCP) measure, among other things. The rule will go into effect Oct. 1, 2021.

The final rule can be found here.

Courts

Find a comprehensive look at “The Courts and Healthcare Policy” here.

Federal Judge Blocks CMS From Rescinding Texas Medicaid Waiver

On Aug. 20, a federal judge in the Eastern District of Texas issued a preliminary injunction temporarily blocking the Centers for Medicare and Medicaid Services (CMS) from rescinding Texas’ 10-year Medicaid uncompensated care waiver. The judge stated that CMS’ move to rescind the waiver is unlawful. The preliminary injunction means that CMS cannot act on its April 16 recission letter until a final judgment is issued in the case.

The Texas waiver was approved in the late days of the Trump administration and provides billions of dollars for the state’s uncompensated care program, which reimburses providers for caring for uninsured patients. In April, the acting CMS administrator informed Texas that the waiver extension would be rescinded because the state failed to complete the required notice and comment period.

U.S. Chamber of Commerce Drops Lawsuit on Drug Price Transparency

On Aug. 25, the U.S. Chamber of Commerce dropped its lawsuit over a health care coverage transparency rule provision requiring insurers, including employer group plans, to disclose drug prices in machine-readable formats. This came after the Biden administration deferred enforcement and delayed start dates of measures in the Transparency in Coverage rule. The delay in enforcement was announced in a frequently asked questions (FAQ) document released on Aug. 23 by the Department of Health and Human Services (HHS).

The FAQ document can be found here.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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