Washington Healthcare Update - October 2019 #4

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This week in Washington: Senate to hold a hearing on eligibility requirements under the Medicaid program, as well as a hearing to review a number of healthcare bills, including OTC drug safety, innovation and reform.

Upcoming Hearings/Markups

Congress

Hearings/Markups

  • House Energy and Commerce Committee: “Sabotage: The Trump Administration’s Attack on Health Care”
  • Senate Committee on Finance: “Treating Substance Misuse in America: Scams, Shortfalls, and Solutions”

House

  • Ways and Means Passes Speaker Pelosi’s Drug Pricing Negotiation Bill, H.R. 3

Senate

  • Bipartisan Drug Patent Bill Used in Negotiations for Broader Drug Pricing Reform

Administration

  • Deadline Approaching for Nomination of New FDA Commissioner

Proposed Regulations/Guidance

  • OIG: Revisions to Safe Harbors Under the Anti-Kickback Statute, Etc.
  • CMS Releases Kidney Care Choices Model Request for Application
  • CMS: Modernizing and Clarifying the Physician Self-Referral Regulations (Stark Law Rule)
  • CMS: Proposed Radiation Oncology (RO) Model
  • FDA: Drug Products Labeled as Homeopathic Guidance
  • FDA: Patient-Focused Drug Development: Methods to Identify What Is Important to Patients’ Guidance

Other

  • Medicaid and CHIP Payment and Access Commission (MACPAC) October Meeting

Reports

  • GAO: Medicaid - Opioid Use Disorder Services for Pregnant and Postpartum Women, and Children
  • GAO: Substance Use Disorder - Prevalence of Recovery Homes, and Selected States’ Investigations and Oversight

Upcoming Hearings/Markups

Wednesday, Oct. 30, 2019

Senate Committee on Finance: “Medicaid: Compliance with Eligibility Requirements”

The Senate Committee on Finance will hold a health care subcommittee hearing on eligibility requirements under the Medicaid program. Witnesses include representatives from the Office of Inspector General at the Department of Health and Human Services (HHS), the Government Accountability Office (GAO), the Louisiana Legislative Auditor and the Center on Budget and Policy Priorities. This hearing foreshadows action that is expected to be taken by the administration soon related to states’ ensuring Medicaid recipients are eligible for Medicaid.

Find more details on the hearing as they become available here.

Thursday, Oct. 31, 2019

Senate Health, Education, Labor and Pensions (HELP) Committee: Health Legislation Hearing, including Over-the-Counter (OTC) Drug Safety, Innovation, and Reform Act of 2019.

  • S. 1657, Ticks: Identify, Control, and Knockout Act
  • S. 2619, Healthy Start Reauthorization Act of 2019
  • S. 1399, Title VIII Nursing Workforce Reauthorization Act of 2019
  • S. 995, Lifespan Respite Care Reauthorization Act of 2019
  • S. 1130, Scarlett’s Sunshine on Sudden Unexpected Death Act
  • S. 1608, Promoting Physical Activity for Americans Act
  • S. 2629, United States Public Health Service Modernization Act of 2019
  • S. __, Over-the-Counter Drug Safety, Innovation, and Reform Act of 2019

Find hearing details here.

Congress

Hearings/Markups

House Energy and Commerce Committee: “Sabotage: The Trump Administration’s Attack on Health Care”

Wednesday, Oct. 23, 2019: The Subcommittee on Oversight and Investigations of the Committee on Energy and Commerce held to seek clarity on the Trump administration’s health care policy choices. The Centers for Medicare and Medicaid (CMS) Administrator Seema Verma testified at the hearing, and was met with hostility from Democratic members who wanted more answers on why the administration is dismantling the Affordable Care Act (ACA).

Find more details on the hearing here.

Senate Committee on Finance: “Treating Substance Misuse in America: Scams, Shortfalls, and Solutions”

Thursday, Oct. 24, 2019: The Senate Committee on Finance held hearing on solutions to the substance misuse concern in the United States. Witnesses included the surgeon general, Dr. Jerome M. Adams; the director of Health Care at the Government Accountability Office (GAO), Dr. Mary Denigan-Macauley; and the deputy inspector general for Investigations at the Department of Health and Human Services (HHS), Gary L. Cantrell.

Find more details on the hearing here.

House

Ways and Means Passes Speaker Pelosi’s Drug Pricing Negotiation Bill, H.R. 3

On Oct. 22, the House Ways and Means Committee passed its amended version of H.R. 3, the Lower Drug Prices Now Act, to the House floor with a 24-17 vote along party lines. Health subcommittee Chairman Lloyd Doggett (D-TX) voted present on passage after unsuccessful attempts to expand the reach of the drug pricing reforms. The committee also endorsed renaming the bill the Elijah E. Cummings Lower Drug Prices Now Act.

The Ways and Means bill will now be consolidated with the marked-up bills from the House Energy and Commerce, and Education and Labor Committees for full House vote, expected in November.

Senate

Bipartisan Drug Patent Bill Used in Negotiations for Broader Drug Pricing Reform

A bipartisan bill from Sens. John Cornyn (R-TX) and Richard Blumenthal (D-CT) to stop drug manufacturers from gaming the patent system to eliminate generic competition is now part of negotiations for broader drug pricing reform. S. 1416, the Affordable Prescriptions for Patients Act of 2019, allows the Federal Trade Commission (FTC) to sue drug manufacturers that get duplicative patents or attempt to delay cheaper generics from entering the market as well.

While the Senate Judiciary Committee already passed the bill, Senate Democrats are using the bipartisan bill’s full passage as a bargaining chip to have more drug pricing legislation on the Senate floor. This is a result of Senate Majority Leader Mitch McConnell’s (R-SC) not yet committing to bring up either the Senate Finance Committee drug package, S. 2543, the Prescription Drug Pricing Reduction Act of 2019 or the Senate HELP Committee bill, S. 1895, the Lower Health Care Costs Act.

Administration

Deadline Approaching for Nomination of New FDA Commissioner

The deadline for the nomination of a new Food and Drug Administration (FDA) commissioner after Scott Gottlieb’s departure is Nov. 1. The Trump administration is expected to make an announcement by next week.

Proposed Regulations/Guidance

OIG: Revisions to Safe Harbors Under the Anti-Kickback Statute, Etc.

On Oct. 9, the Department of Health and Human Services Office of Inspector General (OIG) proposed a rule that creates three new safe harbors for certain remuneration exchanged between or among eligible participants: care coordination arrangements aimed at improving quality and outcomes; value-based arrangements with substantial downside financial risk; and value-based arrangement with full financial risk. Modifications to existing AKS safe harbors include more flexibility for part-time and outcomes-based arrangements, removing the part-time schedule requirement and the aggregate compensation set-in-advance requirement. Modifications were also made to expand and modify mileage limits to rural areas and for transportation of patients discharged from inpatient facilities. As for electronic health records, the proposal extends the interoperability provision.

Find the proposed rule here.

Public comments must be submitted by Dec. 31, 2019.

CMS Releases Kidney Care Choices Model Request for Application

On Oct. 24, the Center for Medicare and Medicaid Innovation (Innovation Center) announced that the request for applications (RFA) for the Kidney Care Choices (KCC) Model has been posted here. The deadline to submit an application is Jan. 22, 2020.

The KCC Model is a voluntary model to reduce Medicare expenditures while preserving or enhancing quality of care for beneficiaries with end-stage renal disease (ESRD) and chronic kidney disease (CKD). The KCC Model contains the following four options:

  1. The CMS Kidney Care First (KCF) option
  2. The Comprehensive Kidney Care Contracting (CKCC) Graduated option
  3. The CKCC Professional option
  4. The CKCC Global option

Stay up to date on the latest Kidney Care Choices Model news and updates by subscribing to the KCC Model listserv.

CMS: Modernizing and Clarifying the Physician Self-Referral Regulations (Stark Law Rule)

On Oct. 9, the Centers for Medicare and Medicaid Services (CMS) proposed a rule that will create new, permanent exceptions to the Stark Law for value-based arrangements. These exceptions would apply broadly to care provided to all patients, not just Medicare beneficiaries. The proposed rule requires health care entities to provide written documentation that explains arrangements and patient populations being targeted, and the outcomes being measured in terms of value. There is a new exception to protect compensation not exceeding an aggregate of $3,500 per calendar year if certain conditions are met, for limited remuneration to a physician.

There is also a new exception for cybersecurity technology and related services, where CMS proposes protecting arrangements involving the donation of certain cybersecurity technology and related services. Modifications to compensation exceptions were added. There rules includes the expansion of the 90-day grace period for writing requirements. CMS proposed the deletion of goal posts for when an entity knows the period of disallowance ended. And, the proposal includes modifying the physician contribution requirement to the electronic health records’ conditions and allowing certain donations of replacement technology.

CMS is soliciting comments about the role of price transparency in the context of the Stark Law and whether to require cost-of-care information at the point of a referral for an item or service.

Find the proposed rule here.

Public comments must be submitted by Dec. 31, 2019.

CMS: Proposed Radiation Oncology (RO) Model

On July 10, the Centers for Medicare and Medicaid Services (CMS) proposed a Radiation Oncology (RO) Model as a payment model that tests if site-neutral payments, in which providers are paid the same rate no matter the care setting, for a 90-day episode of care, can improve the quality of treatment and save Medicare money. The experiment targets radiation treatment for 17 different types of cancer. Payment will be based on proposed national base rates and trend factors and will be adjusted for geography and the mix of patients the provider treats.

Participants in the model could earn back a share of dollars that are withheld based on the quality of care and patient experience. The model is scheduled to begin next year and end in December 2024.

Find the proposed rule here.

FDA: Drug Products Labeled as Homeopathic Guidance

On Oct. 24, the Food and Drug Administration (FDA) pulled a compliance policy allowing leeway for unapproved homeopathic drugs to remain on the market if they met certain criteria, unless FDA found a quality or manufacturing issue. FDA said products should go through the formal drug approval process before they can be sold again.

To replace the older policy, the FDA released a revised draft guidance on a risk-based approach. As a result, FDA intends to prioritize enforcement and regulatory actions involving certain categories of such products that potentially pose a higher risk to public health.

Find the draft guidance here.

Public comments must be submitted by Dec. 24, 2019.

FDA: Patient-Focused Drug Development: Methods to Identify What Is Important to Patients’ Guidance

On Sept. 30, the Food and Drug Administration (FDA) released a second draft guidance in a series of four patient-focused drug development guidances, as required under the 21st Century Cures Act. The series looks at how to collect and submit information from patients and caregivers for medical product development and regulatory decision-making. This draft guidance explains three research methods to do so: qualitative research, quantitative research and mixed-method research.

Find the draft guidance here.

Public comments must be submitted by Dec. 30, 2019.

Other

Medicaid and CHIP Payment and Access Commission (MACPAC) October Meeting

MACPAC will meet on Oct. 31–Nov. 1, 2019, at the Ronald Reagan Building and International Trade Center.

Find more details and the meeting agenda here.

Reports

GAO: Medicaid - Opioid Use Disorder Services for Pregnant and Postpartum Women, and Children

On Oct. 24, the Government Accountability Office (GAO) released a report on opioid use disorder (OUD) services under Medicaid. The GAO looked at treatment services (e.g., outpatient therapy) under Medicaid coverage of opioid addiction treatments for low-income pregnant and postpartum women. The six states reviewed generally covered most of them. Specifically, the six states—Alabama, Arkansas, Colorado, Massachusetts, South Dakota and Texas—covered OUD services, such as screening for opioid use, counseling and medication-assisted treatment, which combines the use of medications with counseling.

As for Medicaid coverage of opioid screening and treatment for children, nationwide, 31 states covered school telehealth services for opioid addiction, such as counseling via video conference. State Medicaid officials said they were not aware of any instances of these services being utilized through telehealth in schools.

Find the full report here.

GAO: Substance Use Disorder - Prevalence of Recovery Homes, and Selected States’ Investigations and Oversight

On Oct. 24, the Government Accountability Office (GAO) released a report on how some recovery home (i.e., peer-run or peer-managed drug- and alcohol-free supportive homes for individuals in recovery from substance use disorder) operators exploit residents to profit from them—for example, by sending them to doctors who bill insurance for unneeded tests and share insurance payments with the operators. In March 2018, GAO found that the prevalence of recovery homes was unknown, with no federal agency responsible for overseeing recovery homes that would compile such data.

Officials in four of the five states reviewed said they conducted or were conducting investigations on recovery homes. No reliable tally of recovery homes was found nationwide. To increase oversight, officials from three of the five states—Florida, Massachusetts and Utah—said they had established state certification or licensure programs for recovery homes in 2014 and 2015. Officials from the other two states—Ohio and Texas—had not established such programs, but were providing training and technical assistance to recovery homes.

Find the full report 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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