The following LPG Weekly Health Care Watch provides a summary update of legislative and regulatory health care activities from April 5 – April 11. Where available, hyperlinks are included to the relevant documents. Please let us know if you have any questions or would like additional information on the items below.
LEGISLATIVE UPDATE
Senate
The Senate stands in recess until at least April 20.
House
The House stands in recess until at least April 20.
REGULATORY UPDATE
On April 6, the Centers for Medicare & Medicaid Services (CMS) released its Announcement of Calendar Year (CY) 2021 Medicare Advantage (MA) Capitation Rates and Part C and Part D Payment. Under the rate notice, CMS finalized a 1.66% rate increase to MA payments, and finalized proposals to 1) increase the weight of encounter data in MA risk scores from 50% to 75% and decrease the weight on diagnosis data (Risk Adjustment Payment System) from 50% to 25% in 2021, and 2) continue its phase-in of the 2020 risk adjustment model, increasing the blend of the 2020 model to 75% (from 50%) and decreasing value the scores from the 2017 model to 25% (from 50%). A fact sheet is available here.
On April 8, CMS delayed the start of the Emergency Triage, Treat, and Transport (ET3) Model from May 1 2020 to Fall 2020 because of COVID-19.
On April 10, CMS released the following proposed payment rules for FY2021:
In what might be a sign of things to come for other providers, the three proposed rules did not contain major policy proposals and focused on routine updates and minor technical changes.
CORONAVIRUS UPDATE
On April 5, Speaker Nancy Pelosi (D-CA) circulated a “Dear Colleague” letter to House Democrats specifying that the fourth COVID-19 package should include more immediate emergency relief by “doubling down on the down-payment” Congress made in H.R. 748, the Coronavirus Assistance, Relief & Economic Security (CARES) Act. Previously, her focus was on a broad recovery bill that would include more general party priorities, such as infrastructure reform. House Democrats’ now want the fourth package to include expanded unemployment benefits, more direct cash payments, and additional aid to state and local governments. Speaker Pelosi has said the bill could “easily” exceed $1 trillion.
On April 7, it was reported that Sen. Doug Jones (D-AL) is hoping to attach a bill to fully cover states’ Medicaid expansion costs for the next three years to incentivize non-expansion states to increase coverage.
On April 8, eight addiction and mental health patient advocacy groups sent a letter to Congress requesting for the next package to include $38.5 billion for the behavioral health system.
On April 8, America’s Health Insurance Plans (AHIP) and the Blue Cross Blue Shield Association sent a letter to Congressional leaders outlining their asks, including reopening enrollment on HealthCare.gov and creating risk mitigation programs.
HELP Chairman Lamar Alexander (R-TN) and Energy & Commerce Ranking Member Greg Walden (R-OR) are leading an effort to attach surprise billing legislation to the package.
Senate Democrats are advocating for a $13 per hour hazard pay bump (capped at $25,000 per worker) for frontline health care workers, as well as a $15,000 incentive payment for people who join the medical workforce during the pandemic.
On April 6, President Donald Trump suggested a COVID-19 treatment will be ready “fairly quick,” citing his communication with four pharmaceutical companies to support his prediction. According to a White House aide, President Trump has spoken with Amgen, Genentech, Regeneron, and Gilead about federal support for clinical trials and aligning regulations with the companies’ needs.
On April 6, AHIP told the American Hospital Association that its members will waive patient cost sharing for testing and treatment. AHIP also promised to expand access to, and coverage for, telehealth services, as well as partner with hospitals to expedite patient care, payment, and administrative work.
On April 6, the National Association of Medicaid Directors sent CMS and the White House Office of Management & Budget (OMB) a letter asking for retainer payments to essential Medicaid providers during the pandemic, warning that many providers are at risk of closing their doors in short order due to extraordinary costs and a loss of revenue.
On April 6, the Trump administration announced 3M will produce 166.5 million masks over the next three months, most of which will be N95 and KN95 (which are appropriate for health care workers).
On April 7, China lifted its 76-day lockdown of Wuhan, the Hubei province where the COVID-19 pandemic first developed.
On April 7, CMS Administrator Seema Verma announced the Agency will pull $30 billion from the $100 billion Public Health and Social Services Emergency Fund (PHSSEF) included in the CARES Act to distribute grants directly to health care providers with “no strings attached.” Administrator Verma specified the first round of funding will be sent to providers with high Medicare revenue in the coming days, and a second round will follow for providers with low Medicare revenue.
On April 9, the Trump administration announced that providers benefiting from the PHSSEF will be prohibited from sending COVID-19 patients surprise medical bills or charging patients more than in-network rates, even for out-of-network care.
On April 10, CMS released the initial $30 billion from the PHSSEF via direct deposit to all facilities and providers who received Medicare FFS reimbursements in 2019. Payments were based on providers’ share of total Medicare FFS spending in 2019. A second tranche of PHSSEF is expected to release next week which could focus on providers who do not have significant Medicare claims (e.g., children’s hospitals, pediatricians), those who treat patients enrolled in Medicare Advantage, and those who treat the uninsured. These funds do not need to be repaid.
On April 7, the Kaiser Family Foundation (KFF) released an analysis estimating that between 670,000 and 2 million uninsured Americans eventually could become hospitalized from COVID-19. Further, KFF predicts that reimbursing hospitals for treatment could cost between $13.9 billion to $41.8 billion.
On April 7, President Trump signaled his intent to investigate the World Health Organization (WHO), accusing the organization of being “funded largely by the U.S. yet very China centric.” The President also threatened to cut U.S. funding, but later walked back the suggestion.
On April 8, Sen. Todd Young (R-IN) asked WHO Director Tedros Adhanom Ghebreyesus to testify before the Senate Foreign Relations Committee about how the organization has handled the pandemic.
On April 9, it was reported that the White House instructed agencies and departments not to send additional funds to WHO without sign-off from high-level officials.
On April 7, President Trump removed the U.S. Department of Defense Acting Inspector General Glenn Fine from leading the Pandemic Response Accountability Committee, one of three groups Congress created in the CARES Act to oversee implementation of a $500 billion fund controlled by the U.S. Treasury meant to stabilize distressed industries. Since the law permits only current inspector generals to fill the position, the President tapped the Environment Protection Agency Inspector General Sean O’Donnell, with whom he has a closer relationship.
On April 8, House Oversight & Government Reform Chair Carolyn Maloney (D-NY) introduced a bill to expand the list of officials able to lead the Committee and ensure that Acting Inspector General Fine could be reinstated.
On April 10, Speaker Nancy Pelosi (D-CA) announced she has begun communicating with Majority Leader Mitch McConnell (R-KY) about appointing the chair of the Congressional Oversight Commission, another oversight group created by the CARES Act, to monitor implementation. The law directs each Republican and Democratic leader in the House and Senate to pick one member of the panel; Speaker Pelosi and Leader McConnell are charged with jointly picking the chair. So far, only Minority Leader Chuck Schumer (D-NY) has announced a selection (Bharat Ramaurti).
On April 8, the U.S. Department of Health & Human Services (HHS) announced it had signed contracts with General Motors (GM) and Philips under the Defense Production Act (DPA) to produce ventilators for the Strategic National Stockpile (SNS). The Department will pay Philips $646.7 million to deliver 2,500 ventilators to the SNS by May and 43,000 by the end of the year. Likewise, GM will receive $489.4 million in exchange for 6,132 ventilators by June and 30,000 by the end of the year.
On April 8, CMS issued a new wave of infection control guidances to protect patients and health care workers.
On April 8, the American Heart Association, American College of Cardiology, and the Health Rhythm Society published an article linking cardiovascular risks to a drug combination (hydroxychloroquine and azithromycin) that is increasingly being prescribed “off-label” for COVID-19 treatment. In addition, on April 9, the National Institutes of Health (NIH) launched a randomized trial to test whether hydroxychloroquine is an effective treatment for COVID-19.
On April 8, HELP Chairman Lamar Alexander (R-TN) and Appropriations Labor, HHS & Education Subcommittee Chairman Roy Blunt (R-MO) asked HHS Secretary Alex Azar to cover antibody testing at no costs to patients with the funds included in the CARES Act. Only one antibody test has received an Emergency Use Authorization (EAU) from the Food & Drug Administration (FDA) but over 80 test manufacturers have notified the Agency that they have a non-authorized test ready for use.
On April 8, Vice President Mike Pence and the coronavirus task force informed House lawmakers that the Administration is exploring ways to return to normalcy and may soon unveil a framework for reopening the country.
On April 10, National Institute of Allergy & Infectious Diseases Director Anthony Fauci said the task force is considering issuing certificates of immunity to allow some people to ease into regular life. This approach is already being implemented in Germany.
On April 12, Director Fauci predicted that parts of the country could begin relaxing stay-at-home orders as early as next month.
On April 9, the Senate failed to pass a new emergency relief package targeted at small businesses. Majority Leader McConnell pushed for adding another $250 billion to the $350 billion Paycheck Protection Program (PPP), which provides small businesses with forgivable loans to be used on payroll and other qualifying expenses. However, Democrats wanted to link an additional $250 billion for hospitals, state and local governments, and food stamps to the small business package. Each side (unsuccessfully) attempted to pass their measure by unanimous consent. On April 11, Leader McConnell and House Republican Leader Kevin McCarthy (R-CA) announced they would continue to seek a clean PPP-only funding bill.
On April 9, the National Cancer Institute (NCI) said enrollment has dropped between 30% to 50% for government-sponsored cancel clinical trials across the country. In response, NCI is developing workarounds to boost enrollment, such as shipping pills directly to patients and allowing local physicians to administer infusion drugs.
On April 9, CMS temporarily suspended several rules in an effort to increase providers’ workforce capacity by allowing various clinicians to practice at the top of their license.
On April 9, Reps. Lloyd Doggett (D-TX) and Rosa DeLauro (D-CT) asked FDA Commissioner Stephen Hahn to publicly release information regarding the accuracy of different tests.
On April 9, HHS testing czar Admiral Brett Giroir said that the federal government is encouraging (not mandating) states to take over drive-through testing sites currently run by HHS and the Federal Emergency Management Agency.
As of April 9, CMS delivered approximately $51 billion to providers and suppliers under the Accelerated and Advance Payments Program. Providers can request up to six months of advanced payments; HHS plans to charge 10.25% interest on such funds if payments are not recouped within one year. On April 8, 33 Senators asked CMS to modify or waive the interest rate, arguing “For this program to be most effective, health care providers will need to be assured that large interest payments will not accrue on the advance payments they receive and that accrual of interest can be delayed as long as possible.” On April 6, the AHA also asked for interest relief. A fact sheet on the Accelerated and Advanced Payment Program, including how to submit a request, is available here.
On April 9, the FDA granted EUAs to a blood purification system and a low temperature sterilizer that decontaminates N95-equivalent respirators.
On April 10, Sen. Mark Warner (D-VA), Sen. Richard Blumenthal (D-CT), and Rep. Anna Eshoo (D-CA) sent Jared Kushner a letter after it was reported that he is working with private technology companies to build a public health surveillance network. In their letter, the lawmakers raise concerns about the privacy implications of such a network.
On April 10, the Federal Communications Commission announced plans to start reviewing applications for the $200 million telehealth fund included in the CARES Act to assist providers in establishing the infrastructure needed to offer telehealth, such as broadband connectivity.
On April 10, the New England Journal of Medicine posted an observational study showing promising results for Gilead’s antiviral Remdesivir as a treatment for patients with severe COVID-19.
On April 10, Apple and Google announced a partnership to develop “contract-tracing” technology to alert iPhone and Android users when they have come in contact with someone diagnosed with COVID-19. They plan to embed the technology in an iOS update by mid-May.
On April 10, CMS issued guidance clarifying that MA plans can use health risk assessments derived via telehealth (both audio and video) for risk adjustment purposes.
On April 11, CMS and the Labor and Treasury Departments released guidance to ensure that those with private health insurance have access to COVID-19 diagnostic testing and certain other related services, including antibody testing, at no cost. The Trump administration also touted the no-cost antibody testing as an effort to allow people to return to work more quickly.
As of April 12, the U.S. had 530,200 confirmed COVID-19 cases resulting in 20,614 deaths, according to Johns Hopkins University & Medicine Coronavirus Resource Center.
RULES AT THE WHITE HOUSE OMB
Pending Review
HHS-CMS
· Conditions for Coverage for End-Stage Renal Disease Facilities—Third Party Payments (CMS-3337-P); Proposed Rule; Received 6/6/2019
· International Pricing Index Model for Medicare Part B Drugs (CMS-5528-P); Proposed Rule; Received 6/20/2019
· Medicare Coverage of Innovative Technologies (CMS-3372-P); Received 7/30/2019
· Medicaid & CHIP Managed Care (CMS-2408-F); Final Rule; Received 9/26/2019
· Establishing Minimum Standards in Medicaid State Drug Utilization Review (DUR) and Supporting Value Based Payments (VBP) for Drugs Covered in Medicaid (CMS-2482-P); Proposed Rule; Received 12/27/19
· Hospital Inpatient Prospective Payment Systems (IPPS) for Acute Care Hospitals; the Long-Term Care Hospital Prospective Payment System; and FY 2021 Rates (CMS-1735); Proposed Rule; Received 1/30/20
· Strengthening Oversight of Accrediting Organizations (AO) and Preventing AO Conflict of Interest, and Related Provisions (CMS-3367); Proposed Rule; Received 2/18/20
· FY 2021 Inpatient Rehabilitation Facility (IRF) Prospective Payment System Rate Update and Quality Reporting Requirements (CMS-1729); Proposed Rule; 2/24/20
· Specialty Care Models to Improve Quality of Care and Reduce Expenditures (CMS-5527); Proposed Rule; Received 3/10/20
· Amendments to the HHS-operated Risk Adjustment Data Validation under the Patient Protection and Affordable Care Act's (ACA) HHS-operated Risk Adjustment Program (CMS-9913); Proposed Rule; Received 3/11/20
· Treatment of Medicare Part C Days in the Calculation of a Hospital's Medicare Disproportionate Patient Percentage (CMS-1739); Proposed Rule; Received 3/12/20
· Patient Protection and Affordable Care Act; HHS Notice of Benefit and Payment Parameters for 2021; Notice Requirement for Non-Federal Governmental Plans (CMS-9916); Final Rule; Received 4/9/20
HHS-FDA
· Annual Summary Reporting Requirements Under the Right to Try Act; Proposed Rule; Received 3/31/20
HHS-HRSA
· Coordinating Care and Information Sharing in the Treatment of Substance Use Disorders; Final Rule; 3/16/20
REPORTS
Government Accountability Office (GAO)
On April 6, GAO released a report entitled FDA Drug Approval: Application Review Times Largely Reflect Agency Goals. FDA’s goal is to complete review 90% of new drug applications within deadlines that vary depending on the drug. GAO reviewed 637 new drug applications submitted between FYs 2014-2018 and concluded that the FDA met its goals. GAO also noted that FDA divisions differed on how long it took them to review new drug applications.
On April 7, GAO posted a report entitled Maternal Mortality: Trends in Pregnancy-Related Deaths and Federal Efforts to Reduce Them. GAO’s report describes trends in pregnancy-related deaths in the U.S. and HHS funding efforts focused on reducing pregnancy-related deaths. Using CDC data, GAO found that between 2007 to 2016, over 6,700 women died of causes related to or provoked by their pregnancy (either while pregnant or within a year of the end of pregnancy). GAO also reported an overall increase in the pregnancy-related mortality ratio in the U.S. during this time frame. In addition, GAO reports that the leading causes of pregnancy-related deaths differed by racial ethnic groups, and factors such as cardiovascular conditions, infection, and hemorrhage were the leading causes of pregnancy-related deaths.
HHS Office of Inspector General (OIG)
On April 6, OIG released a report entitled Hospital Experiences Responding to the COVID-19 Pandemic: Results of a National Pulse Survey. OIG conducted a survey between March 23-27 to aid policymakers with a national snapshot of hospitals’ challenges and demands in responding to the COVID-19 pandemic. Hospitals reported that their most significant challenges centered on testing and caring for COVID-19 patients and keeping staff safe. Hospitals said that severe shortages of testing supplies and extended waits for test results limited hospitals' ability to monitor the health of patients and staff. They also claimed shortages of personal protective equipment and inability to maintain adequate staffing levels put staff and patients at risk.
On April 9, OIG posted a report entitled Iowa Inadequately Monitored Its Medicaid Health Home Providers, Resulting in Tens of Millions in Improperly Claimed Reimbursement. Based on their audit of 130 payments to health home providers during FY 2016, OIG reports that Iowa improperly claimed federal Medicaid reimbursement for 62 payments, mostly because of documentation deficiencies. OIG estimates such improper payments translate to at least $37.1 million in federal Medicaid reimbursement; therefore, OIG recommends for Iowa return this sum to the federal government, as well as improve its monitoring of the home health program.
On April 9, OIG issued a report entitled New York Did Not Bill Manufacturers for Some Rebates for Drugs Dispensed to Enrollees of Medicaid Managed-Care Organizations. OIG estimates that New York did not bill for and collect from manufacturers at least $10.8 million in rebates (federal share) for pharmacy and physician-administered drugs that were eligible or may have been eligible for rebates between January 2015 through December 2017. OIG recommends that New York recoup missed rebates and strengthen its internal controls to ensure that all pharmacy and physician-administered drugs eligible for rebates are invoiced.
UPCOMING HEARINGS
Senate
None of note
House
None of note
OTHER HEALTH POLICY NEWS
On April 6, Connecticut Gov. Ned Lamont (D) signed an Executive Order (EO) that seeks to curb surprise medical bills related to COVID-19 treatment. While Connecticut already has laws to limit surprise billing, the EO specifically precludes providers from billing uninsured patients more than Medicare rates and allows insurers to pay in-network rates for out-of-network treatment.
On April 6, the U.S. Sixth Circuit Court of Appeals denied Ohio’s request to lift a district court’s block on the state’s COVID-19 abortion ban, allowing abortions to continue in Ohio on a case-by-case basis.
On April 6, a U.S. District Court issued a temporary restraining order blocking Oklahoma’s COVID-19 abortion ban. The court ruled that the state’s EO labeling abortion as a “non-essential” procedure constituted a “plain and palpable deprivation of a fundamental right” for pregnant women.
On April 9, U.S. District Judge Lee Yeakel loosened Texas’ COVID-19 abortion ban, allowing medication and surgical abortions to continue certain pregnancies.
On April 6, a U.S. District Judge James Boasberg paused a lawsuit on work requirements in Indiana until the COVID-19 emergency concludes.
On April 8, Sen. Bernie Sanders (I-VT) withdrew his candidacy from the 2020 democratic primary. The next day, former Vice President Joe Biden outlined new plans to capture Sen. Sanders’ progressive base, including lowering the Medicare eligibility age to 60.