This Week in Washington: House passes Lower Costs, More Transparency Act and SUPPORT Act Reauthorization; Senate HELP Committee reports SUPPORT Act Reauthorization and three other bills out of committee; ONC releases final rule concerning clinical use of AI.

Congress

House

• House Passes Lower Costs, More Transparency Act and SUPPORT Act Reauthorization
• Forty-Eight Members Send Letter Concerning Manufacturer Copay Accumulators
• House Energy and Commerce Committee Chairmen Threaten to Subpoena FDA Over Foreign Drug Inspection Program

Senate

• Senate HELP Committee Marks Up SUPPORT Act Reauthorization and Three Other Bills
• Senate Finance Committee Chairman Sends Letter Concerning Pharmacy Prescription Record Sharing Practices
• MACPAC Releases 2023 Medicaid and CHIP Data Book

Administration

• HHS Releases 2023 Data Strategy
• HHS Releases Revised Reports, Fact Sheets and Guidance Concerning Medicare Drug Price Negotiation and Inflation Rebate Programs
• HHS Announces Fair-Price Requirement for ASPR-Funded Medical Products
• CMS Announces New Maternal Healthcare Model
• CMS Sends Letter to PBMs and Insurance Providers Concerning Practices Harmful to Pharmacies and Patients
• CMS Issues Informational Bulletin on Worker Management Platforms
• FDA Issues Nine Warning Letters Over Unapproved and Misbranded Antimicrobial Animal Drugs
• FDA Requests Applications for Rare Neurodegenerative Disease Grant Program
• FDA Issues Draft Guidance on Advanced Manufacturing Technologies Designation Program
• FDA to Establish Genetic Metabolic Diseases Advisory Committee
• FDA to Finalize LDT Final Rule by April 2024
• ONC Announces Launch of TEFCA Health Data Exchange

Proposed Rules

• CMS Proposed Rule Outlines Benefit and Payment Parameters for 2025
• CMS Proposes Rule to Strengthen Medicare Advantage, Part D and Behavioral Healthcare Access
• CMS Proposes Rule to Penalize Providers Who Block Electronic Health Information
• CMS Proposes Rule Regarding Federal IDR Process
• FDA Proposes Rule Regarding Classification of Wound Dressings and Washes

Final Rules

• ONC Final Rule Establishes Transparency Requirements for Artificial Intelligence and Predictive Algorithms
• FDA Final Rule Implements Direct-To-Consumer Prescription Drug Ad Standards
• CMS Final Rule Implements Nursing Home Ownership and Management Disclosure Requirements
• CMS Final Rule Outlines Remedy for 340B Payment Cuts Deemed Unlawful Between CYs 2018-2022
• CMS Final Rule Updates 2024 Medicare Physician Fee Schedule
• CMS Final Rule Updates 2024 Hospital OPPS and ASC Payment System
• CMS Final Rule Updates 2024 Home Health Prospective Payment System
• CMS Final Rule Updates 2024 ESRD Prospective Payment System
• CMS Final Rule Mandates Medicaid and CHIP Program Core Set Measures Reporting
• CMS Finalizes 2024 Medicare Advantage and Part C and D Payment Policies
• FDA Issues Final Rule Regarding Mammography Quality Standards

Courts

• Supreme Court to Hear Case on Abortion Pill Access
• Supreme Court Orders Lower Courts to Void Rulings Concerning Vaccine Mandates

Reports

• GAO Releases Report Regarding VA Mobile Medical Units
• GAO Releases Report Regarding CMS Oversight of Medicaid State-directed Payments
• GAO Releases Report Regarding Federal Funding for Health-Related Organizations
• GAO Releases Report Regarding Independent Dispute Resolution Process Challenges
• GAO Releases Report Regarding Utilization of Medicare Cognitive Assessment Services

CBO Cost Estimates

• CBO Releases Presentation Regarding Fiscal Effects of Medicaid Spending on Children

Note

• Happy Holidays and Happy New Year

Congress

House

House Passes Lower Costs, More Transparency Act and SUPPORT Act Reauthorization

Last week, the House passed the Lower Costs, More Transparency Act, a legislative package that includes provisions seeking to increase hospital and other provider price transparency, implement site-neutral payments for off-campus hospital outpatient departments, ban pharmacy benefit manager spread pricing and extend funding for health programs.

The House also passed the Support for Patients and Communities Reauthorization Act. The legislation reauthorizes opioid-use disorder prevention, treatment and recovery programs; permanently extends Medicaid coverage for medication-assisted treatments; improves overdose response training programs; and places xylazine in Schedule III of the Controlled Substances Act.

In addition, the House passed the Dr. Emmanuel Bilirakis and Honorable Jennifer Wexton National Plan to End Parkinson’s Act. The legislation would require the Department of Health and Human Services to develop a national plan to prevent and cure Parkinson’s disease.

Forty-Eight Members Send Letter Concerning Manufacturer Copay Accumulators

On Dec. 12, Rep. Carter (R-GA) led 48 members in sending a letter to the Secretaries of HHS, Labor and Treasury—Xavier Becerra, Julie Su and Janet Yellen—concerning copay accumulators and the recent decision by the U.S. District Court for the District of Columbia that vacated the 2021 Notice of Benefit and Payment Parameters (NBPP) Final Rule that permitted the use of copay accumulator adjustment programs.

The members believe HHS should notify beneficiaries and reaffirm the 2020 NBPP Final Rule that states group health plans and health insurers must count copay assistance toward a patient’s maximum annual limitation on cost-sharing (MOOP) for drugs that do not have a medically appropriate generic equivalent available.

For more information, click here.

House Energy and Commerce Committee Chairmen Threaten to Subpoena FDA Over Foreign Drug Inspection Program

On Dec. 14, House Energy and Commerce Committee Chairman Cathy McMorris Rodgers (R-WA) and two subcommittee chairmen, Brett Guthrie (R-KY) and Morgan Griffith (R-VA), sent a follow-up letter to Food and Drug Administration (FDA) Commissioner Robert Califf, warning that the committee could subpoena the FDA if it does not submit documents and information concerning the FDA foreign drug inspection program.

The chairmen are concerned about the effectiveness of the program after reports indicated a reduction in the total number of FDA foreign inspections and an increase in drug manufacturing facility citations in 2022.

For more information, click here.

Senate

Senate HELP Committee Marks Up SUPPORT Act Reauthorization and Three Other Bills

On Dec. 12, the Senate Health, Education, Labor and Pensions Committee marked up and reported out of committee four bills. Among them was the SUPPORT for Patients and Communities Reauthorization Act, which would reauthorize programs that provide substance use disorder prevention, treatment and recovery services, and increase funding for mental and behavioral health training and the National Child Traumatic Stress Initiative.

In addition, the committee reported out of committee the Screening for Communities to Receive Early and Equitable Needed Services for Cancer Act of 2023, which would reauthorize the National Breast and Cervical Cancer Early Detection Program, the Advancing Research in Education Act, which would reauthorize the Education Science Reform Act and the Modernizing Opioid Treatment Access Act, which would allow certain providers to prescribe methadone for opioid use disorder.

For more information, click here.

Senate Finance Committee Chairman Sends Letter Concerning Pharmacy Prescription Record Sharing Practices

On Dec. 12, Senate Finance Committee Chairman Ron Wyden (D-OR) and Reps. Jayapal (D-WA) and Jacobs (D-CA) sent a letter to Department of Health and Human Services (HHS) Secretary Xavier Becerra, expressing their concern over the practice by some pharmacies to provide patient prescription records to law enforcement agencies without requesting a warrant.

The chairman and members have been investigating pharmacy prescription record-sharing practices and discovered through inquiries with pharmacy companies that several do not require a warrant prior to sharing records with law enforcement agencies. The chairman and members are urging HHS to address pharmacy privacy practices and revise Health Insurance Portability and Accountability Act regulations to require a warrant for law enforcement to access prescription records.

For more information, click here.

MACPAC Releases 2023 Medicaid and CHIP Data Book

On Dec. 15, the Medicaid and Children’s Health Insurance Program (CHIP) Payment and Access Commission (MACPAC) released the 2023 MACStats: Medicaid and CHIP Data Book. The data book contains the latest data and information on the Medicaid and CHIP programs and is divided into the following six sections:

• Key statistics on Medicaid and CHIP;
• Trends in Medicaid spending, enrollment and share of state budgets;
• Medicaid and CHIP enrollment and spending;
• Medicaid and CHIP eligibility;
• Measures of beneficiary health, use of services and access to care; and
• A technical guide regarding data sources and methods.

For more information, click here.

Administration

HHS Releases 2023 Data Strategy

On Dec. 14, the Department of Health and Human Services (HHS) released the 2023 HHS Data Strategy. The Data Strategy outlines the priorities and initiatives that HHS intends to focus on over the next five years, to improve its data usage and infrastructure.

The Strategy revolves around the following five priorities: cultivating data talent, fostering data sharing, integrating administrative data into program operations, enabling whole-person care delivery by connecting human services data and responsibly leveraging artificial intelligence.

For more information, click here.

HHS Releases Revised Reports, Fact Sheets and Guidance Concerning Medicare Drug Price Negotiation and Inflation Rebate Programs

On Dec. 14, the Department of Health and Human Services (HHS) announced the release of revised reports, fact sheets and guidance concerning the Medicare Drug Price Negotiation Program and Medicare Part B and D Inflation Rebate Programs. They include:

• A report released by the HHS Office of the Assistant Secretary for Planning and Evaluation (ASPE) that reviews the utilization and spending trends of 10 drugs selected for the first round of Medicare drug price negotiations;
• An ASPE fact sheet detailing which drug and biological products will receive a coinsurance adjustment under the Medicare Part B inflation rebate provisions for calendar year 2023;
• Fact sheets released by the Centers for Medicare and Medicaid Services (CMS) concerning revised guidances issued for the Medicare Prescription Drug Inflation Rebate Program and the reduced coinsurance for certain Part B rebatable drugs in the first quarter of 2024; and
• A letter sent by CMS to private insurance plans and pharmacy benefit managers concerning patients’ access to care.

For more information, click here.

HHS Announces Fair-Price Requirement for ASPR-Funded Medical Products

On Dec. 14, the Department of Health and Human Services announced that the Administration for Strategic Preparedness and Response (ASPR) will implement fair-pricing requirements in contracts it signs with drug manufacturers for medical products that underwent research efforts paid for by ASPR funds.

CMS Announces New Maternal Healthcare Model

On Dec. 15, the Centers for Medicare and Medicaid Services (CMS) announced that it will establish the Transforming Maternal Health (TMaH) Model, which will support participating state Medicaid agencies in developing and implementing a whole-person approach to pregnancy, childbirth and postpartum care. CMS will release a Notice of Funding Opportunity in spring 2024 and applications will be due summer 2024.

For more information, click here.

CMS Sends Letter to PBMs and Insurance Providers Concerning Practices Harmful to Pharmacies and Patients

On Dec. 14, Centers for Medicare and Medicaid Services (CMS) Administrator Chiquita Brooks-LaSure sent a letter to pharmacy benefit managers (PBMs) and Medicare Part D, Medicaid managed care and private insurance plan providers, regarding practices they are engaged in that CMS has deemed harmful to pharmacies, patients and physicians.

The practices highlighted in the letter include vertical integration among PBMs, reduced payments being made to pharmacists for the administration of COVID-19 and influenza vaccines, insurance plan providers misusing prior authorization and plans and providers imposing cost sharing on coverage of preventive services.

For more information, click here.

CMS Issues Informational Bulletin on Worker Management Platforms

On Dec. 12, the Centers for Medicare and Medicaid Services (CMS) issued an informational bulletin concerning the use of worker management platforms, also known as registries. CMS is encouraging states and stakeholders to use registries to inform Medicaid and home and community-based service beneficiaries about providers in their area from whom they can obtain services.

For more information, click here.

FDA Issues Nine Warning Letters Over Unapproved and Misbranded Antimicrobial Animal Drugs

On Dec. 14, the Food and Drug Administration (FDA) issued warning letters to nine companies that are manufacturing and distributing unapproved and misbranded antimicrobial animal drugs. The unapproved animal drugs contain antimicrobials that are important to human medicine, including amoxicillin, penicillin and tetracycline. The FDA is concerned that their use could contribute to the development of antimicrobial resistance.

For more information, click here.

FDA Requests Applications for Rare Neurodegenerative Disease Grant Program

On Dec. 13, the Food and Drug Administration (FDA) announced a new funding opportunity for the FDA Rare Neurodegenerative Disease Grant Program, to support the development and validation of clinical outcome assessments and biomarker studies to promote medical product development for rare neurogenerative diseases. Applications for the funding opportunity are due by May 6.

For more information, click here.

FDA Issues Draft Guidance on Advanced Manufacturing Technologies Designation Program

On Dec. 12, the Food and Drug Administration issued draft guidance regarding the Advanced Manufacturing Technologies Designation Program. The draft guidance provides recommendations for stakeholders who are interested in participating in the program and outlines the program’s eligibility criteria, benefits and submission and assessment process.

For more information, click here.

FDA to Establish Genetic Metabolic Diseases Advisory Committee

On Dec. 12, the Food and Drug Administration (FDA) announced that it would create the Genetic Metabolic Diseases Advisory Committee. The committee will provide the FDA with technical and scientific advice and will evaluate products used for the diagnosis, prevention and treatment of genetic metabolic diseases.

For more information, click here.

FDA to Finalize LDT Final Rule by April 2024

On Dec. 11, the Food and Drug Administration (FDA) announced that it intends to finalize a final rule concerning laboratory-developed tests by April 2024. The FDA released a proposed version of the rule in October. The rule would classify in vitro diagnostic products as medical devices under the Federal Food, Drug and Cosmetic Act and would restore the FDA’s authority to regulate them.

ONC Announces Launch of TEFCA Health Data Exchange

On Dec. 12, the Department of Health and Human Services Office of the National Coordinator for Health Information Technology announced that a health data exchange governed by the Trusted Exchange Framework and Common Agreement (TEFCA) is now operational.

TEFCA was developed to make it easier and safer for providers to share healthcare information. Providers must first complete onboarding and be designated a qualified health information network before gaining access to the TEFCA exchange.

For more information, click here.

Proposed Rules

CMS Proposed Rule Outlines Benefit and Payment Parameters for 2025

On Nov. 15, the Centers for Medicare and Medicaid Services released a proposed rule that would implement proposed standards for qualified health plans (QHPs) that are offered through the health insurance marketplace for 2025. It would also establish new requirements for health plan agents, brokers, direct enrollment entities and assisters. The proposed rule would:

• Require state marketplaces and state-based marketplaces on the federal platform (SBM-FPs) to establish quantitative time and distance QHP network adequacy standards;
• Allow states to add routine adult dental services as an essential health benefit;
• Revise certain prescription drug benefits;
• Enhance consumer protections and standards;
• Establish marketplace call center standards;
• Require state marketplaces and Medicaid/CHIP agencies to pay to access and use Verify Current Income Hub service income data;
• Implement a federally facilitated marketplace user fee of 2.2 percent and a SBM-FP user fee of 1.8 percent; and
• Implement a risk adjustment fee of $0.20 per member per month for the 2025 benefit year.

In addition, the proposed rule would grant states more flexibility when adopting income and resource disregards when determining financial eligibility for Medicaid for non-Modified Adjusted Gross Income populations.

Public comments will be accepted until Jan. 8, 2024. For more information, click here.

CMS Proposes Rule to Strengthen Medicare Advantage, Part D and Behavioral Healthcare Access

On Nov. 6, the Centers for Medicare and Medicaid Services released a proposed rule that would implement technical and policy changes to the Medicare Advantage (MA), Prescription Drug Benefit and Cost Plan programs in addition to the Programs of All-Inclusive Care for the Elderly (PACE) beginning in contract year (CY) 2025. The proposed rule would:

• Implement a $632 fixed payment for MA and Part D agents and brokers who assist individuals in enrolling in a MA or Part D plan;
• Establish a new MA facility-specialty type called “Outpatient Behavioral Health,” which will include marriage and family therapists, mental health counselors and other addiction and behavioral health providers;
• Encourage MA plans to increase engagement efforts and inform plan enrollees about supplemental benefits;
• Require MA plans to demonstrate that special supplemental benefits for the chronically ill (SSBCI) meet reasonable expectations of improving chronically ill enrollees’ health and well-being;
• Direct MA plans to analyze utilization management policies from a health equity perspective;
• Limit out-of-network cost sharing for dual eligible special needs plans; and
• Standardize the MA plan risk adjustment data validation (RADV) appeals process.

Public comments will be accepted until Jan. 5, 2024. For more information, click here.

CMS Proposes Rule to Penalize Providers Who Block Electronic Health Information

On Oct. 30, the Centers for Medicare and Medicaid Services released a proposed rule that would establish disincentives for healthcare providers who knowingly interfere with the access, exchange or use of electronic health information except when required by law or regulatory exception. The proposed rule would:

• Under the Medicare Promoting Interoperability Program, penalize hospitals that block information by reducing their annual market basket increase by 75 percent and reducing a critical access hospital’s payment to 100 percent of reasonable costs;
• Under the Merit-based Incentive Payment System Promoting Interoperability performance category, penalize clinicians or groups by awarding them a zero score for the category; and
• Under the Medicare Shared Savings Program, penalize accountable care organizations (ACO) and ACO participants, providers or suppliers by deeming them ineligible to participate in the program for at least one year.

Public comments will be accepted until Jan. 2, 2024. For more information, click here.

CMS Proposes Rule Regarding Federal IDR Process

On Oct. 27, the Centers for Medicare and Medicaid Services (CMS) released a proposed rule that would amend requirements for the federal independent dispute resolution (IDR) process. The proposed rule would:

• Require group health plans and insurers to provide additional information at the time of an initial payment or notice of denial of payment for certain items and services covered by surprise billing protections;
• Implement changes to the IDR open negotiation process to incentivize stronger communication between disputing parties;
• Revise the process for initiating the federal IDR process; and
• Modify requirements related to IDR dispute eligibility review and the payment and collection of administrative and certified IDR entity fees.

In addition to CMS, the Employee Benefits Security Administration and Internal Revenue Service are proposing the rule.

Public comments will be accepted until Jan. 2, 2024. For more information, click here.

FDA Proposes Rule Regarding Classification of Wound Dressings and Washes

On Nov. 30, the Food and Drug Administration (FDA) released a proposed rule that would classify certain types of wound dressings and liquid wound washes containing antimicrobials and other chemicals, as solid wound dressings. The FDA currently regulates gel, cream, ointment and liquid wound dressings and washes as unclassified devices requiring premarket notification.

Under the proposed rule, the FDA would classify wound dressings and liquid wound washes with a high level of antimicrobial resistance concern as Class III medical devices. In addition, wound dressings and washes with a medium or low level of antimicrobial resistance would be classified as Class II medical devices.

Public comments will be accepted until Feb. 28, 2024. For more information, click here.

Final Rules

ONC Final Rule Establishes Transparency Requirements for Artificial Intelligence and Predictive Algorithms

On Dec. 13, the Department of Health and Human Services Office of the National Coordinator for Health Information Technology (ONC) released a final rule that updates the ONC Health IT Certification Program and establishes new standards, implementation specifications and certification criteria. The final rule will:

• Establish transparency requirements for artificial intelligence and other predictive algorithms that are part of certified health IT;
• Adopt the United States Core Data for Interoperability Version 3 as the new baseline standards within the ONC Health IT Certification Program as of Jan. 1, 2026;
• Revise certain information-blocking definitions and exceptions to support information sharing; and
• Require developers of certified health IT to report certain metrics as part of their participation in the Certification Program, to better understand how certified health IT is used to support care delivery.

For more information, click here.

FDA Final Rule Implements Direct-To-Consumer Prescription Drug Ad Standards

On Nov. 21, the Food and Drug Administration (FDA) released a final rule that implements new standards for direct-to-consumer (DTC) television and radio prescription drug advertisements. The final rule will require advertisers to:

• Present information using language that is clear and readily understandable by consumers;
• Place textual information against a contrasting background for a sufficient duration, using a font style and size that is easily legible;
• Announce prescription drug information in the same volume, articulation and pacing used in the rest of the ad;
• Certify that no distracting representations including statements, text, images or sounds are used during the ad’s major statement; and
• Simultaneously present visual and audible information for ads in television format.

The final rule complements a final guidance the FDA issued in June that outlined how advertisers should present quantitative efficacy and risk information in DTC promotional labeling and ads.

The final rule will go into effect on May 20, 2024. The compliance date of the rule is Nov. 20, 2024.

For more information, click here.

CMS Final Rule Implements Nursing Home Ownership and Management Disclosure Requirements

On Nov. 15, the Centers for Medicare and Medicaid Services released a final rule that implements stricter ownership and management disclosure and reporting requirements for nursing homes enrolled in Medicare or Medicaid. The final rule will require nursing homes to:

• Disclose additional information regarding their owners, operators and management, specifically the individuals and entities that provide administrative services or clinical consulting services to the nursing home;
• Disclose entities that exercise financial control over the facility;
• Report the names of individuals or entities that lease or sublease property to the facility, or who own a whole or part interest equal to or exceeding 5 percent of the total value of such real property; and
• Provide information on the organizational structures of disclosed parties.

In addition, the final rule defines a private equity and real estate investment trust and finalizes definitions to assist nursing homes in collecting the requested data.

The final rule will go into effect on Jan. 16, 2024. For more information, click here.

CMS Final Rule Outlines Remedy for 340B Payment Cuts Deemed Unlawful Between CYs 2018-2022

On Nov. 2, the Centers for Medicare and Medicaid Services (CMS) released a final rule that outlines how it will pay back hospitals that participate in the 340B Drug Pricing Program and were impacted by payment cuts between calendar years (CYs) 2018 and 2022, which were deemed unlawful. The final rule clarifies that:

• CMS will repay impacted 340B hospitals in a single lump-sum payment equal to the difference in what CMS paid hospitals for 340B drugs between CYs 2018-2022 and the amount they would have paid if the payment cuts had not been implemented; and
• CMS will establish a policy to recoup funds from hospitals that received higher rates for non-drug services. CMS intends to achieve this by annually adjusting the outpatient prospective payment system conversion factor by minus 0.5 percent beginning in CY 2026 until the full amount is offset. This is projected to take 16 years.

The final rule will go into effect on Jan. 7, 2024. For more information, click here.

CMS Final Rule Updates 2024 Medicare Physician Fee Schedule

On Nov. 2, the Centers for Medicare and Medicaid Services released a final rule that updates the Medicare Physician Fee Schedule (PFS) payment rates for calendar year 2024. The final rule will:

• Decrease the PFS conversion factor by 3.4 percent from $33.89 to $32.74;
• Decrease overall PFS payment rates by 1.25 percent;
• Finalize separate coding and payment for new caregiver and health equity services;
• Allow eligible marriage and family therapists and addiction counselors to enroll in Medicare starting Jan. 1, 2024;
• Allow payments to be made for certain dental services linked to specific cancer treatments; and
• Enhance the Medicare Diabetes Prevention Program (MDPP) Expanded Model and allow MDPP suppliers to continue using COVID-19 public health emergency flexibilities and offer services virtually through Dec. 31, 2027.

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

CMS Final Rule Updates 2024 Hospital OPPS and ASC Payment System

On Nov. 2, the Centers for Medicare and Medicaid Services released a final rule that updates the hospital outpatient prospective payment system (OPPS) and the ambulatory surgical center (ASC) payment system for calendar year 2024. It also finalizes changes to the Hospital Outpatient Quality, ASC Quality and Rural Emergency Hospital Quality reporting programs. The final rule will:

• Increase hospital OPPS and ASC payment rates by 3.1 percent, based on an inpatient hospital market basket percentage increase of 3.3 percent and a 0.2 percent reduction in the final productivity adjustment;
• Modify and adopt new quality reporting measures;
• Establish payments for intensive outpatient program services under Medicare;
• Update payment rates for partial hospitalization program services;
• Modify community mental health center conditions of participation; and
• Establish the Rural Emergency Hospital (REH) provider type.

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

CMS Final Rule Updates 2024 Home Health Prospective Payment System

On Nov. 1, the Centers for Medicare and Medicaid Services released a final rule that updates payment policies and rates for Medicare Home Health Agencies for calendar year 2024. It also finalizes changes to the Home Health Quality Reporting and Value-based Purchasing Programs. The final rule will:

• Increase home health payments by 0.8 percent, based on a projected 3.0 percent increase in home health payments, a 2.6 percent decrease in the permanent behavior assumption adjustment and a 0.4 percent increase in the fixed-dollar ratio for outlier payments adjustment;
• Implement a permanent prospective payment adjustment of minus 2.89 percent;
• Increase the home health market basket percentage by 3.0 percent;
• Establish an informal dispute resolution and special focus program for hospice programs; and
• Add new and updated quality reporting measures.

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

CMS Final Rule Updates 2024 ESRD Prospective Payment System

On Oct. 27, the Centers for Medicare and Medicaid Services released a final rule that updates the payment policies and rates for the end-stage renal disease (ESRD) prospective payment system (PPS) for renal dialysis services covered under Medicare for calendar year (CY) 2024. It also updates the acute kidney injury dialysis payment rate and requirements for the ESRD Quality Incentive Program. The final rule will:

• Increase the ESRD PPS base rate by 2.1 percent to $271.02;
• Implement new ESRD PPS claims reporting requirements;
• Finalize a new transitional add-on pediatric ESRD dialysis payment adjustment for CYs 2024, 2025 and 2026;
• Discuss the responses CMS received to a request for information it issued related to a low-volume payment adjustment; and
• Implement a payment adjustment for new renal dialysis drugs and biological products after the Transitional Drug Add-on Payment Adjustment (TDAPA) period.

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

CMS Final Rule Mandates Medicaid and CHIP Program Core Set Measures Reporting

On Aug. 31, the Centers for Medicare and Medicaid Services (CMS) released a final rule that would establish mandatory state reporting requirements for the following quality measures:

• Core set of Children’s Health Care Quality measures under Medicaid and the Children’s Health Insurance Program (CHIP);
• Behavioral health measures on the Core Set of Adult Health Care Quality Measures for Medicaid; and
• Core Sets of Health Home Quality Measures for Medicaid.

The final rule will go into effect on Jan. 1, 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.

Courts

Supreme Court to Hear Case on Abortion Pill Access

On Dec. 13, the U.S. Supreme Court announced that it will review a decision made by the U.S. Court of Appeals for the Fifth Circuit concerning access to the abortion pill mifepristone. The lower court ruled in August that the Food and Drug Administration (FDA) did not follow proper procedures when it loosened regulations for obtaining mifepristone and allowed the pill to be taken later in pregnancy and be mailed directly to patients. The FDA also allowed non-physician medical professionals to prescribe the medication, including via telehealth.

Oral arguments are expected to begin in the spring and a decision is likely to come by the end of June. The Supreme Court clarified that it would not take up a separate appeal that challenges the FDA’s initial approval of the drug in 2000 and seeks to remove the drug from the market entirely.

Supreme Court Orders Lower Courts to Void Rulings Concerning Vaccine Mandates

On Dec. 11, the U.S. Supreme Court ordered the U.S. Court of Appeals for the District of Columbia Circuit, the Court of Appeals for the Fifth Circuit and the Court of Appeals for the Sixth Circuit to dismiss as moot, cases that the courts had previously ruled on concerning the legality of federal worker and military personnel COVID-19 vaccine mandates.

The Supreme Court argued that the lower court rulings should be voided because the vaccine mandates were voluntarily withdrawn. The Supreme Court’s decision erases all precedent concerning the legality of federal vaccine mandates.

Reports

GAO Releases Report Regarding VA Mobile Medical Units

On Dec. 14, the Government Accountability Office (GAO) released a report regarding mobile medical units (MMUs) that the Department of Veterans Affairs (VA) uses to provide primary and specialty care to veterans in rural areas. The VA is required by Congress to submit annual reports regarding the operations and performance of its MMUs.

After reviewing MMU reports from 2018 to 2022 and interviewing VA medical center and regional network officials, the GAO discovered that the reports submitted by the VA to Congress inaccurately reported the number of active MMUs and failed to explain why 20 units failed to meet VA operational requirements. The GAO conducted this study because it was asked to examine the VA’s use of MMUs.

For more information, click here.

GAO Releases Report Regarding CMS Oversight of Medicaid State-directed Payments

On Dec. 14, the Government Accountability Office (GAO) released a report regarding the policies and procedures the Centers for Medicare and Medicaid Services (CMS) uses to oversee Medicaid managed care state-directed payments.

After interviewing CMS officials and analyzing approved payment information, the GAO discovered that CMS has not yet defined what “reasonable and appropriate” payments are, does not consider state evaluation results when deciding to approve directed payment renewals and has failed to increase transparency of payment evaluation results and information.

For more information, click here.

GAO Releases Report Regarding Federal Funding for Health-Related Organizations

On Dec. 12, the Government Accountability Office (GAO) released a report regarding federal funding for organizations that provide preventive and reproductive healthcare services. This includes community-based health centers, privately owned regional organizations, the Planned Parenthood Federation of America and the International Planned Parenthood Federation.

After analyzing data from the Department of Health and Human Services’ (HHS) Payment Management System and the U.S. Agency for International Development’s Phoenix System, in addition to state Medicaid agency and Small Business Administration payment data, the GAO discovered that between 2019 and 2022, HHS obligated $33.67 billion to health centers and $49 million to Planned Parenthood affiliates. The GAO conducted this study because it was asked to provide updated information on federal funding for organizations that provide health-related services.

For more information, click here.

GAO Releases Report Regarding Independent Dispute Resolution Process Challenges

On Dec. 12, the Government Accountability Office (GAO) released a report outlining the challenges that health insurers and providers are facing when using the federal independent dispute resolution (IDR) process.

After reviewing published reports and interviewing officials from the Centers for Medicare and Medicaid Services (CMS), the Department of Labor and healthcare providers, the GAO discovered that federal officials have struggled to keep up with the high number of submitted disputes and have been unable to increase enforcement efforts due to budget constraints. In addition, healthcare providers have been increasingly frustrated over a lack of response to submitted complaints. The GAO conducted this study because a provision in the 2021 Consolidated Appropriations Act required it to review the federal IDR process.

For more information, click here.

GAO Releases Report Regarding Utilization of Medicare Cognitive Assessment Services

On Dec. 11, the Government Accountability Office (GAO) released a report regarding the utilization of cognitive assessment services by Medicare beneficiaries.

After analyzing Medicare fee-for-service claims and enrollment data from 2018 to 2022 and interviewing stakeholder group officials, the GAO discovered that use of cognitive assessment services by Medicare beneficiaries tripled between 2018 and 2022. The GAO also discovered that more than 80 percent of these services were provided by neurologists, nurse practitioners, internists, family physicians and geriatricians.

For more information, click here.

CBO Cost Estimates

CBO Releases Presentation Regarding Fiscal Effects of Medicaid Spending on Children

On Dec. 13, the Congressional Budget Office (CBO) released a presentation regarding the short- and long-term fiscal effects of Medicaid spending on children. The CBO concludes that in the short term, costs for Medicaid are paid upfront when children or their mothers receive healthcare services. In the long term, Medicaid enrollment during childhood appears to help individuals earn more in adulthood, which could lead to larger tax revenues and lower transfer payments for the federal government.

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Happy Holidays and Happy New Year

We wish you Happy Holidays and a Happy New Year. The next issue of the Washington Healthcare Update will be published the week of Jan. 15.