This Week in Washington: Appropriation bills move forward but remain incomplete; House Energy and Commerce Committee markup includes 17 healthcare bills; Senate Finance Committee schedules PBM markup

Upcoming Hearings

Congress

House

• House Appropriators Continue Work on Funding Bills
• House Energy and Commerce Health Subcommittee Marks Up 17 Healthcare Bills
• House Education and Workforce Committee Marks Up Four Healthcare Bills
• House Energy and Commerce Committee Chairman Announces Plans to Circulate Drug Shortage Discussion Draft

Senate

• Senate Majority Leader Outlines Work Priorities in Dear Colleague Letter
• Senate Continues Work on Appropriations Bills
• Senate HELP Committee Ranking Member Unveils Legislation
• Senate Finance Committee Continues Work on PBMs

Administration

• White House Issues Guidance on No Surprises Act
• HHS Issues RFI on Medical Credit Cards and Installment Loans
• HHS Releases Report on Projected Impact of IRA Prescription Drug Provision
• CMS Proposes Physician Fee Schedule for 2024
• CMS Innovation Center Tests Models for Health Equity and Releases Findings
• CMS Affirms Alzheimer’s Drug Coverage and Opens Clinician Registry
• CMS Releases Final 2023 QRS and QHP Enrollee Survey Call Letter

Proposed Rules

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

Final Rules

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

Reports

• GAO Releases Report on DOD Military Medical Personnel
• GAO Releases Report on Future Public Health Emergency Preparedness
• GAO Releases Report Regarding Indian Health Service Adverse Event Monitoring

CBO Cost Estimates

• CBO Releases Cost Estimate for H.R. 3561, the PATIENT Act of 2023

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Upcoming Hearings

July 18

House

House Energy and Commerce Health Subcommittee Hearing: “Innovation Saves Lives: Evaluating Medicare Coverage Pathways for Innovative Drugs, Medical Devices, and Technology”
10:30 a.m., Rayburn House Office Building 2322
Witnesses to be announced.

House Oversight and Accountability Committee Subcommittee on Health Care and Financial Services Hearing: “Why Expanding Medicaid to DACA Recipients Will Exacerbate the Border Crisis”
2:00 p.m., Rayburn House Office Building 2247
Announced witnesses are:

• Ellen Montz, Deputy Administrator and Director of the Centers for Medicare and Medicaid Services Center for Consumer Information and Insurance Oversight

July 19

House

House Committee on Small Business Subcommittee on Oversight, Investigations, and Regulations Hearing: “Burdensome Red Tape: Overregulation in Health Care and the Impact on Small Businesses”
10:00 a.m., Rayburn House Office Building 2360
Witnesses to be announced.

House

House Appropriators Continue Work on Funding Bills

On July 14, the House Appropriations Committee Subcommittee on Labor, Health and Human Services, and Education subcommittee held a markup of the FY 2024 Labor, Health and Human Services and Education appropriations bill and moved it out of the subcommittee.

The proposed House Republican funding levels for the Labor-HHS bill are below the spending caps agreed to in the debt-ceiling agreement.

The proposed bill would:

• Authorize $147 billion in overall funding to labor and health programs, a 29 percent reduction from FY 2023 funding levels;
• Cap funding for the Department of Health and Human Services (HHS) at $103.3 billion, $14 billion less than in FY 2023;
• Reduce funding for the Centers for Disease Control and Prevention (CDC) by $1.6 billion;
• Reduce funding for the National Institutes of Health (NIH) by $3.8 billion; and
• Eliminate funding for various healthcare programs, including the Agency for Healthcare Research and Quality and the CDC Center for Forecasting and Outbreak Analytics.

For more information, click here.

House Energy and Commerce Health Subcommittee Marks Up 17 Healthcare Bills

On July 13, the House Energy and Commerce Subcommittee on Health marked up and voted out of committee 17 healthcare bills. The bills that were considered include:

H.R. 824, Telehealth Benefit Expansion for Workers Act of 2023
This legislation would expand COVID-19 telehealth flexibilities issued by the Departments of Health and Human Services (HHS), Labor, and the Treasury, and allow employers to offer stand-alone coverage of telehealth-only services to employees.

H.R. 3226, Prematurity Research Expansion and Education for Mothers who deliver Infants Early (PREEMIE) Reauthorization Act of 2023
This legislation would reauthorization the Prematurity Research Expansion and Education for Mother who deliver Infants Early (PREEMIE) Act for fiscal years (FYs) 2024 to 2028. It would direct the Centers for Disease Control and Prevention (CDC) and the Health Resources and Services Administration (HRSA) to strengthen efforts to reduce preterm births and infant mortality and would authorize a new study to analyze the financial costs of premature births on society.

H.R. 3838, Preventing Maternal Deaths Reauthorization Act of 2023
This legislation would reauthorize federal support of state efforts to address disparities that exist in maternal health outcomes. It would require the CDC to work with HRSA to inform hospitals and healthcare providers of maternal mortality prevention strategies.

H.R. 3843, Action for Dental Health Act of 2023
This legislation would reauthorize Section 340G of the Public Health Service Act to address dental workforce needs.

H.R. 3884, Sickle Cell Disease and Other Heritable Blood Disorders Research, Surveillance, Prevention, and Treatment Act of 2023
This legislation would reauthorize Section 1106 of the Public Health Service Act for FYs 2024 to 2028 to continue research and treatment services.

H.R. 3821, Firefighter Cancer Registry Reauthorization Act of 2023
This legislation would reauthorize funding for FYs 2024 to 2028, for a voluntary CDC registry used to report firefighter cancer incidents.

H.R. 2365, National Plan to End Parkinson’s Act
This legislation would direct the HHS Secretary to coordinate and improve federal prevention, treatment and cure strategies for Parkinson’s disease. It would also require HHS to form an advisory council to assess current national Parkinson’s disease recommendations and strategies.

H.R. 3391, Gabriella Miller Kids First Research Act 2.0
This legislation would reauthorize funding through FY 2028 for the National Institutes of Health (NIH) Gabriella Miller Kids First Pediatric Research Program. It would also enhance the coordination of federal pediatric cancer research efforts and require HHS to report on federally funded pediatric cancer research programs and initiatives.

H.R. 4421, Preparing for All Hazards and Pathogens Reauthorization Act
This legislation would reauthorize federal programs supporting public health security and all-hazards response, the Biomedical Advanced Research and Development Authority (BARDA), the Public Health Emergency Medical Countermeasures Enterprise (PHEMCE) and the Strategic National Stockpile (SNS). It would also contain provisions aimed at streamlining emergency response authorities and medical countermeasure research and enhancing transparency across federal agencies.

H.R. 4420, Preparedness and Response Reauthorization Act
This legislation would reauthorize CDC programs that support the distribution of medical countermeasures and the control of biological agents and mosquito-borne diseases. It would also strengthen epidemiological monitoring.

H.R. 4529, Public Health Guidance Transparency and Accountability Act of 2023
This legislation would require the CDC to implement public participation requirements prior to finalizing and implementing guidance. It would also clarify that CDC guidance is nonbinding.

H.R. 4381, Public Health Emergency Congressional Review Act
This legislation would establish a congressional review process for a public health emergency (PHE) and would allow Congress to consider and vote on terminating a PHE six months after it was declared.

H.R. 3813, CDC Leadership Accountability Act of 2023
This legislation would require any director of the CDC appointed by the president on or after June 1, 2023, to be confirmed by the Senate.

H.R. 3836, Medicaid Primary Care Improvement Act
This legislation would clarify that current Medicaid law does not prohibit state Medicaid programs from using direct primary care to provide services to Medicaid beneficiaries. It would also require the Centers for Medicare and Medicaid Services (CMS) to report to Congress on existing Medicaid primary care contracting arrangements.

H.R. 4531, Support for Patients and Communities Reauthorization Act
This legislation would reauthorize portions of the Substance Use-Disorder Prevention that Promotes Opioid Recovery and Treatment for Patients and Communities (SUPPORT) Act. It would reauthorize public health programs related to substance use disorder prevention, treatment and recovery and the permanent extension of Medicaid’s required coverage of medication-assisted treatments.

H.R. 4056, Ensuring Medicaid Continuity for Foster Care Act
This legislation would lift Medicaid’s institutions for mental diseases (IMD) exclusion pertaining to qualified residential treatment programs (QRTPs) for foster youth. It would limit the lifting of the IMD Exclusion to QRTPs that are in compliance with existing QRTP guardrails outlined in the Family First Prevention Services Act of 2018.

H.R. 3887, Children’s Hospital GME Support Reauthorization Act
This legislation would reauthorize payments to children’s hospitals that have Graduate Medical Education programs for FYs 2024 to 2028. It would also prohibit payments to children’s hospitals that furnish specified procedures or drugs for minors.

For more information, click here.

House Education and Workforce Committee Marks Up Four Healthcare Bills

On July 11, the House Education and Workforce Committee marked up and voted out of committee four healthcare bills. The bills that were considered include:

H.R. 4509, Transparency in Billing Act
This legislation would prohibit group health plans from paying a hospital for providing services at an off-campus location unless they provide a separate health identifier. It would also authorize the Department of Health and Human Services (HHS) to charge hospitals for noncompliance. Hospitals with more than 30 beds would be charged up to $5500 per day and hospitals with less than 30 beds would be charged up to $300 per day.

H.R. 4507, Transparency in Coverage Act
This legislation would codify the October 2020 Centers for Medicare and Medicaid Services (CMS) Transparency in Coverage Final Rule, which would require health plans to publicly disclose price and cost-sharing information to consumers. In addition, it would require pharmacy benefit managers (PBMs) to disclose spending and compensation data to their plan administrator.

H.R. 4527, Health DATA Act
This legislation would allow health plan fiduciaries to access and review de-identified cost and quality information of their plan.

H.R. 4508, Hidden Fee Disclosure Act
This legislation would strengthen requirements for pharmacy benefit managers (PBMs) and third-party administrators and require them to disclose fees and compensation data to plan sponsors.

For more information, click here.

House Energy and Commerce Committee Chairman Announces Plans to Circulate Drug Shortage Discussion Draft

On July 12, House Energy and Commerce Chairman Cathy McMorris Rodgers (R-WA) announced that the committee will circulate a drug shortage discussion draft following the completion of a recent request for information (RFI) that the chairman led alongside Senate Finance Committee Ranking Member Mike Crapo (R-ID).

For more information, click here.

Senate

Senate Majority Leader Outlines Work Priorities in Dear Colleague Letter

On July 9, Senate Majority Leader Chuck Schumer (D-NY) sent out a Dear Colleague letter outlining his plan for the July congressional work period. The leader is urging his colleagues to work on a bipartisan basis and advance legislation relating to an array of policy areas, among them health bills that seek to address the ongoing fentanyl crisis and the cost of insulin and prescription drugs. The leader is also encouraging the Senate to build upon his previously released artificial intelligence (AI) framework and to continue confirming judicial nominees.

For more information, click here.

Senate Continues Work on Appropriations Bills

The Senate Appropriations Committee is continuing its work on appropriations for fiscal year 2024, including commerce, science, financial services, the legislative branch and general government. Before going on recess, the Senate Appropriations Committee passed two bills: the FY 2024 Agriculture-FDA and the Military Construction and Veterans Affairs funding bills. Senate appropriators are setting funding levels close to spending caps that were agreed to in the debt-ceiling agreement. This is in contrast to House appropriators who are setting funding levels below those agreed upon.

Senate HELP Committee Ranking Member Unveils Legislation

On July 13, Senate Health, Education, Labor and Pensions (HELP) Committee Ranking Member Bill Cassidy (R-LA) introduced the Community Health Care Reauthorization Act. The bill would increase funding for the Community Health Center Fund (CHCF) to $4.2 billion and increase funding for the National Health Service Corps to $350 million over the next two years. It would also increase funding for the Teaching Health Center Graduate Medical Education (THCGME) program to $275 million over the next six years.

In addition, the ranking member noted that his decision to introduce the bill came after negotiations regarding the reauthorization of community health center funding between his office and committee Chairman Bernie Sanders (I-VT) stalled. The chairman and ranking member are in disagreement over the total amount of funding that should be allocated.

For more information, click here.

Senate Finance Committee Continues Work on PBMs

On July 12, the Senate Finance Committee unveiled a draft bill that would increase pharmacy benefit manager (PBM) disclosure requirements. The committee has been developing legislation since April, when committee Chairman Ron Wyden (D-OR) and Ranking Member Mike Crapo (R-ID) released a bipartisan framework outlining legislative solutions.

In addition, the chair and ranking member announced that they will mark up PBM and federal prescription drug program proposals on July 26.

For more information on the draft PBM bill, click here.

For more information on the upcoming markup, click here.

Administration

White House Issues Guidance on No Surprises Act

On July 7, the White House released new guidance on loopholes used by healthcare providers that violate the surprise billing protections of the No Surprises Act. Specifically the guidance is aimed at ending the abuse of the “in-network” designation and the increase of patients’ being charged for facility fees outside of hospitals.

Currently, some health plans can contract with hospitals and claim those hospitals are not technically in-network. The administration’s guidance makes clear that such a move is prohibited under the surprise billing law, and health services provided by these providers need to either be designated in or out of network.

The guidance also focuses on an increase in patients’ being charged “facility fees” outside of hospitals. Such fees are often unexpected and the administration said health plans and providers must warn patients about these add-on fees. The administration also made it clear that providers and emergency rooms can’t get around the surprise billing law by renaming charges as “facility fees.”

The guidance is separate from an expected upcoming rule on surprise medical billing from CMS that is expected to amend the independent dispute resolution process.

For more information, click here.

HHS Issues RFI on Medical Credit Cards and Installment Loans

On July 7, the Department of Health and Human Services (HHS), in collaboration with the Centers for Medicare and Medicaid Services (CMS), the Department of Treasury and the Consumer Financial Protection Bureau (CFPB), issued a request for information (RFI) on the prevalence of high-cost specialty products such as medical credit cards and installment loans. The agencies are concerned that healthcare providers are pushing high-cost products onto patients, which can lead to higher healthcare costs and medical debt.

The RFI seeks to gather information on the specialty medical payment product market, patient experiences and downstream consequences, billing and financial assistance issues, and healthcare provider incentives. Public comments will be accepted until Sept. 5.

For more information, click here.

HHS Releases Report on Projected Impact of IRA Prescription Drug Provision

On July 7, the Department of Health and Human Services (HHS) Office of the Assistant Secretary for Planning and Evaluation (ASPE) released a report highlighting the projected impact of the Inflation Reduction Act (IRA) out-of-pocket prescription drug spending cap provision. The provision will go into effect in 2025 and will cap out-of-pocket prescription drug prices at $2000. HHS predicts that that provision will help 19 million seniors save $400 per year, resulting in a projected savings total of $7.4 billion.

For more information on the IRA Prescription Drug Provision report, click here.

CMS Proposes Physician Fee Schedule for 2024

The proposed 2024 Physician Fee Schedule includes a variety of policy changes.

Extend Medicare Diabetes Prevention Program Flexibilities

In the proposed 2024 Physician Fee Schedule (PFS) rule, CMS is proposing to extend COVID-19 public health emergency (PHE) flexibilities that applied to the Medicare Diabetes Prevention Program (MDPP) for another four years. MDPP suppliers would be allowed to provide MDPP services through distance learning and virtual technology through Dec. 31, 2027. Additionally, MDPP suppliers would be able to:

• Collect program participant weight measurements via virtual technology;
• Provide an unlimited amount of virtual sessions;
• Use a new distance learning G-code for distance learning services delivered virtually; and
• Bill for each session attended, up to 22 within the 12-month MDPP program period.

For more information, click here.

CMS and CDC Issue RFI on CLIA Revisions

The proposed rule includes a request for information (RFI) to CMS and the Centers for Disease Control and Prevention (CDC). The agencies are seeking comment on the revisions that the proposed rule would make to Clinical Laboratory Improvement Amendments (CLIA) regulations. The RFI is requesting input on various topics including:

• Whether and how CLIA should provide oversight of histopathology slide preparation;
• What an acceptable time interval to review a gross tissue specimen would be; and
• What standards should be considered for the examination of clinical cytogenetic images at a remote location apart from the primary CLIA-certified site.

Comments for the RFI will be accepted until Sept. 11, 2023. For more information, click here.

CMS Innovation Center Tests Models for Health Equity and Releases Findings

On July 10, the Centers for Medicare and Medicaid Services (CMS) Center for Medicare and Medicaid Innovation released findings of a recent analysis it conducted on Innovation Center models. The Center was interested in understanding the extent to which its models incorporate and address issues related to health equity.

After conducting an analysis, the Center determined that model designs have not always considered needs specific to underserved individuals and that the variability in Medicare and Medicaid claims race and ethnicity data makes it difficult to understand whether models are helping enroll underserved individuals. Additionally, the Center concluded that several model designs have too small of a sample size of underserved populations and that this limits any ability to draw conclusions.

For more information, click here.

CMS Affirms Alzheimer’s Drug Coverage and Opens Clinician Registry

On July 6, the Centers for Medicare and Medicaid Services (CMS) acknowledged that it would ensure broad coverage for Leqembi, following the Food and Drug Administration’s (FDA) decision to grant the medication full traditional approval. Approximately 10,000 Alzheimer’s patients are estimated to receive the drug before April 2024, with hundreds of thousands of other patients expected to be eligible to receive the drug in the years to come.

CMS reiterated that Medicare will cover the cost of the drug so long as Alzheimer’s patients are enrolled in Medicare, are diagnosed with mild cognitive impairment or Alzheimer’s disease dementia and participate in a clinician- or clinical team-led data registry and follow-up care routine. The CMS registry is now open and accessible for clinicians.

In response to Leqembi’s full approval, Senate Health, Education, Labor and Pensions (HELP) Committee Chairman Bernie Sanders (I-VT) sent a letter to the Secretary of Health and Human Services (HHS) Xavier Becerra criticizing the determined market price of the drug and warning of the impact it could have on out-of-pocket costs for senior citizens and Medicare premiums.

For more information on the CMS announcement, click here.

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

CMS Releases Final 2023 QRS and QHP Enrollee Survey Call Letter

On July 5, the Centers for Medicare and Medicaid Services (CMS) released the 2023 Quality Rating System (QRS) and Qualified Health Plan (QHP) Final Enrollee Survey Call Letter. The letter outlines finalized refinements that CMS is making to the QRS and QHP Enrollee Survey programs and the QRS measure set. It also lists the items that CMS is removing from the QHP Enrollee Survey questionnaire and incorporates public comments that were submitted to the Draft 2023 Call Letter.

For more information, click here.

Proposed Rules

CMS Proposed Rule Contains RFI on Episode-based Payment Model

On July 14, the Centers for Medicare and Medicaid Services (CMS) released a proposed rule that seeks comment through a request for information (RFI) on the design of a future CMS Center for Medicare and Medicaid Innovation episode-based payment model. The Center is considering designing and implementing a new episode-based payment model that would focus on healthcare equity, quality and costs. The Center is seeking information from individuals who have experience with bundled payments and noted that responses to the RFI may be used to inform potential future rulemaking and policy development.

Public comments will be accepted until Aug. 17, 2023. For more information, click here.

CMS Proposed Rule Updates CY 2024 Medicare PFS Payments

On July 13, the Centers for Medicare and Medicaid Services (CMS) released a proposed rule that updates the Medicare physician fee schedule (PFS) payment rates for calendar year (CY) 2024. The proposed rule would:

• Decrease the conversion factor by 3.34 percent to $32.75;
• Delay implementation of a policy that defines the substantive portion of a split or shared visit based on the amount of time spent by a billing practitioner;
• Create a new benefit category for marriage and family therapists and mental health counselors under Medicare Part B;
• Establish new payment codes for mobile psychotherapy for crisis services;
• Implement five new optional Merit-based Incentive Payment System Value Reporting Pathways; and
• Extend several telehealth waivers.

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

CMS Proposed Rule Revises FY 2024 Medicare Hospital OPPS and ASC Payment Systems

On July 13, the Centers for Medicare and Medicaid Services (CMS) released a proposed rule concerning the Medicare hospital Outpatient Prospective Payment System (OPPS) and the Medicare Ambulatory Surgical Center (ASC) payment system for fiscal year (FY) 2024. The proposed rule would:

• Increase OPPS payment rates for hospitals that meet applicable quality reporting requirements by 2.8 percent. This is based off of a projected hospital market basket percentage increase of 3.0 percent minus a 0.2 percent productivity adjustment;
• Update the productivity-adjusted hospital market basket update factor to ASC rates by 2.8 percent and extend its application through calendar years (CYs) 2024 and 2025;
• Establish the Intensive Outpatient Program (IOP) under Medicare and implement various IOP service provisions;
• Update partial hospitalization program (PHP) Medicare payment rates;
• Strengthen hospital price transparency;
• Adopt and codify several standard quality program reporting policies; and
• Expand access to behavioral healthcare and promote safe and effective patient-centered care.

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

OCR Proposed Rule Reaffirms Federal Discrimination Protections in HHS Grants

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

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

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

CMS Proposed Rule Updates Medicare Home Health PPS Rates for CY 2024

On July 10, the Centers for Medicare and Medicaid Services (CMS) released a proposed rule that updates the Medicare Home Health Prospective Payment System (PPS) rates for calendar year (CY) 2024. The proposed rule would:

• Apply a permanent PPS adjustment of negative 5.653 percent;
• Cut reimbursement rates for home health providers by 2.2 percent;
• Add and remove quality measures from the Home Health quality reporting program;
• Codify requirements for negative wound therapy;
• Establish regulations and implement the items and services payment for lymphedema compression treatment and home intravenous globulin services;
• Address concerns about unnecessary utilization, costs, and care quality; and
• Add and informal dispute resolution (IDR) and special focus program (SFP) for hospice programs.

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

CMS Proposed Rule Outlines Remedy to 340B Program Payment Adjustments

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

Under the proposed rule:

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

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

CMS Proposed Rule Modifies Definition of Short Term Health Plans

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

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

In addition to CMS, the Internal Revenue Service and the Employee Benefits Security Administration are proposing the rule. The agencies are also seeking comment and information on specified disease excepted benefits coverage and level-funded plans.

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

CMS Proposed Rule Updates and Revises ESRD PPS for CY 2024

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

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

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

CMS Proposes Rule to Strengthen Medicaid Drug Price Transparency and Verification

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

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

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

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

FDA Proposes Rule to Broaden Prescription Drug Labeling Regulations

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

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

FDA Proposes New Tobacco Product Manufacturing Practices Requirements

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

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

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

Final Rules

OIG Final Rule Outlines Civil Money Penalty Regulations

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

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

CMS Final Rule Clarifies Medicare DSH Payment Adjustment Part C Days

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

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

CMS Final Rule Eliminates COVID-19 Healthcare Worker Vaccination Requirement

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

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

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

DEA Releases Temporary Rule Extending COVID-19 Telemedicine Flexibilities

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

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

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

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

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

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

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

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

FDA Issues Final Rule Regarding Mammography Quality Standards

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

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

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

FDA Delays Tobacco Product Required Warning Final Rule Effective Date

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

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

CMS Issues Correction on Clinical Laboratory Improvement Amendments (CLIA) Final Rule

On Nov. 17, the Centers for Medicare and Medicaid Services (CMS) corrected a technical error that was found in a final rule published in the Federal Register on July 11, 2022. The final rule updates proficiency testing (PT) regulations under the Clinical Laboratory Improvement Amendments of 1988 (CLIA), to address analytes and newer technologies.

The rule goes into effect July 11, 2024. For more information, click here.

Reports

GAO Releases Report on DOD Military Medical Personnel

On July 11, the Government Accountability Office (GAO) released a report that analyzes the Department of Defense (DOD) healthcare system. The GAO was interested in understanding what impacts the reduction of military medical personnel would have on the DOD healthcare system, after the DOD proposed reducing its medical personnel by 10,000 in 2021.

The GAO analyzed methodologies the DOD uses to monitor the state of its healthcare system and discovered that the DOD lacks the ability to fully assess the impact a reduction or realignment of its active-duty medical personnel would have on its ability to deliver quality healthcare services. The GAO issued this report due to a provision in the fiscal year (FY) 2022 National Defense Authorization Act that directed the GAO to review DOD’s analyses in support of the reduction or realignment of military medical personnel.

For more information, click here.

GAO Releases Report on Future Public Health Emergency Preparedness

On July 11, the Government Accountability Office (GAO) released a report that summarizes previous GAO findings and recommendations from COVID-19 oversight reports that were issued between April 2022 and April 2023. The report examines the impact the COVID-19 public health emergency (PHE) had on the U.S. economy and vulnerable populations, and examines the distribution of COVID-19 relief funding, the prevalence of payment fraud and the challenges that federal agencies faced during the PHE.

The GAO issued this report due to a provision in the Coronavirus Aid, Relief, and Economic Security (CARES) Act that requires it to report regularly on the public health and economic effects of the COVID-19 pandemic and the federal response.

For more information, click here.

GAO Releases Report Regarding Indian Health Service Adverse Event Monitoring

On July 10, the Government Accountability Office (GAO) released a report analyzing how well the Indian Health Service (IHS) monitors adverse events that are reported in the IHS Safety Tracking and Response System. The GAO also examined how the IHS uses its electronic health record system to monitor healthcare quality at federally operated facilities.

The GAO discovered that despite the IHS developing standard reports for areas and facilities based on adverse event trends entered into its tracking system, the IHS does not include area or facility-level performance trends in its reports. The GAO also discovered that the reports do not incorporate location-based adverse event trends. Without analyzing adverse event trends by location, the IHS headquarters is unable to provide sufficient management and patient safety oversight of individual facilities. The GAO conducted this study because it was asked to review IHS’s capacity for using its information technology systems to manage patient care and adverse events.

For more information, click here.

CBO Cost Estimates

CBO Releases Cost Estimate for H.R. 3561, the PATIENT Act of 2023

On July 11, the Congressional Budget Office (CBO) released a cost estimate for H.R. 3561, the PATIENT Act of 2023. The bill would codify and strengthen federal hospital and health insurance price transparency rules and would extend funding for the Teaching Health Center Graduate Medical Education, the Community Health Center and the National Health Service Corps programs.

CBO and the Joint Committee on Taxation estimate that implementing various portions of the bill will not have an effect on direct spending or revenues.

For more information, click here.