Weekly Health Care Policy Update – July 2, 2021

July 9, 2021

In this update: 

  • Biden Administration Announces Updates on COVID-19 Response 
    • Provider Relief Fund Reporting Portal Opens
    • ACF Announces $1 Billion for Head Start
  • CMS Announces Director of Center for Medicaid and CHIP
  • HHS, Labor, Treasury, and OPM Release Interim Final Rule on Surprise Billing
  • CMS Releases Proposed Updates to the Medicare Home Health PPS
  • CMS Issues Proposed Rule Governing Exchanges for 2022 and Beyond
  • CMS Proposes CY 2022 ESRD Payment Rule
  • CMS Revokes Medicaid Work Requirements in Two States
  • SCOTUS Declines to Hear Appeal Challenging HHS’ Site-Neutral Payment Policy
  • SCOTUS Accepts Several Health Care Cases for Next Term
  • CDC Data Indicates Almost All COVID-19 Deaths Are Unvaccinated
  • Study Finds 70% of Physicians are Employed by Hospitals or Corporate Entities
  • Advisory Council on Alzheimer’s Research, Care, and Services to Discuss Aducanumab
  • Congressional Recess
  • Governor Cuomo Signs OMH Licensure Exemption Extension and Other Bills
  • DOH Announces Prior Authorization Minimum Data Set Policy Effective August 1st
  • Updates on NYS COVID-19 Regulatory Flexibilities Post-Executive Order 202

Administration Updates

Biden Administration Announces Updates on COVID-19 Response
This week, the Biden Administration announced new updates on the COVID-19 response: 

  • Provider Relief Fund Reporting Portal Opens: The reporting portal is now open for providers required to report their use of Provider Relief Fund (PRF) money during reporting period 1 (April 10, 2020 – June 30, 2020). Funds received during this period had to be expended by June 30th (of this year). Providers who received payments exceeding $10,000 during this reporting period will have until September 30th, to report how funds were used. The Health Resources and Services Administration (HRSA) will hold a technical assistance webinar for providers on July 8th at 3pm ET.
  • ACF Announces $1 Billion for Head Start: On June 30th, the Department of Health and Human Services (HHS) and the Administration for Children and Families announced the availability of $1 billion in funding from the American Rescue Plan Act (ARP) for Head Start programs nationwide. The funds are intended to help Head Start programs return to full, in-person capacity this fall, support summer programming, and support vaccination of Head Start staff and families. A press release is available here.

CMS Announces Director of Center for Medicaid and CHIP
On June 18th, the Centers for Medicare and Medicaid Services (CMS) announced the appointment of Daniel Tsai as Director of the Center for Medicaid and CHIP Services. Tsai previously served as Assistant Secretary for MassHealth and Medicaid Director, where he led the program through a major restructuring through a Section 1115 waiver approved in 2016. Tsai begins work at CMS on July 6th.

CMS’s press release is available here. 

Regulatory Updates

HHS, Labor, Treasury, and OPM Release Interim Final Rule on Surprise Billing
On July 1st, HHS, in collaboration with the Departments of Labor, Treasury, and the Office of Personnel Management, released an interim final rule with comment period (IFC) to implement provisions of the No Surprises Act, entitled “Requirements Related to Surprise Billing; Part I.” This rule covers the following types of services: 

  • Emergency services;
  • Out-of-network air ambulance services; and
  • Out-of-network services provided at in-network facilities, in certain circumstances, including hospitals and ambulatory surgery centers (ASCs).

These protections are implemented for individuals with coverage through an employer (including federal, state, or local government), through federal Marketplaces, state-based Marketplaces, or directly through an individual market health insurance issuer. The rule does not cover individuals covered by Medicare, Medicaid, Indian Health Services, Veterans Affairs Health Care, or TRICARE, which already prohibit balance billing.
 
Key provisions of the rule include: 

  • Emergency services must be covered without any prior authorization, regardless of whether a provider or facility is in-network, and regardless of any other terms or conditions (except for exclusion or coordination of benefits, or a permitted affiliation or waiting period).
  • For covered services, an individual’s out-of-network cost-sharing is to in-network level.
  • For covered services, an individual’s cost-sharing must count toward any in-network deductibles and out-of-pocket maximums.
  • Covered health care providers must furnish patients with a one-page notice on the requirements and prohibitions applicable regarding balance billing, any applicable state balance billing prohibitions or limitations, and how to contact appropriate state and federal agencies if the patient believes a provider has violated the requirements in the notice.
  • Cost-sharing amounts for emergency services provided by an out-of network emergency facility or provider will be calculated based on one of the following: 
    • An amount determined by an applicable All-Payer Model Agreement under section 1115A of the Social Security Act;
    • If there is no such applicable All-Payer Model Agreement, an amount determined under a specified state law;
    • If neither of the above apply, the lesser amount of either the billed charge or the qualifying payment amount, which is generally the plan’s or issuer’s median contracted rate.
  • The total out-of-network rate paid to the provider or facility will be: 
    • An amount determined by an applicable All-Payer Model Agreement under section 1115A of the Social Security Act;
    • If there is no such applicable All-Payer Model Agreement, an amount determined under a specified state law;
    • If there is no such applicable All-Payer Model Agreement or specified state law, an amount agreed upon by the plan or issuer and the provider or facility;
    • If none of the three conditions above apply, an amount determined by an independent dispute resolution (IDR) entity. Regulations are forthcoming regarding IDR entities and processes.

In the individual market, the regulations are generally applicable for plan years beginning on or after January 1, 2022. For providers, regulations are applicable beginning on January 1, 2022.

The proposed rule can be found here. A fact sheet is also available. Comments are due within 60 days of publication in the Federal Register (which has not yet occurred).

CMS Releases Proposed Updates to the Medicare Home Health PPS
On June 28th, CMS proposed updates to the Medicare Home Health Prospective Payment System (HH PPS) and home infusion therapy services rates for Calendar Year (CY) 2022. In total, CMS estimates Medicare payments to home health agencies in CY 2022 will increase by 1.7 percent (or $310 million) under the proposed rule. The proposed rule does not include a final home infusion therapy payment amount, given that the CPI-U for June 2021 is not yet available. It will be released in a forthcoming change request.
 
Additional key provisions of the rule include: 

  • Nationwide expansion of the Home Health Value-Based Purchasing (HHVBP) Model, including up to a five percent increase or reduction in payments based on performance on certain quality measures.
  • Permanent implementation of the Conditions of Participation (CoP) introduced during the COVID-19 Public Health Emergency (PHE).
  • Permanent authorization for mandated 14-day on-site supervisory visits to be conducted via telehealth.
  • Implementation of a statutory requirement that permits occupational therapists to conduct initial comprehensive assessments for Medicare beneficiaries under the home health benefit in certain circumstances.
  • Continuation of an increased payment amount for the first home infusion therapy visit and a decreased amount for subsequent visits.
  • Solicitation of input on a variety of issues, including: 
    • Using the Fast Healthcare Interoperability Resources (FHIR) framework to support digital quality measurement;
    • The method used to make the CY 2020 Patient-Driven Groupings Model (PDGM); and
    • Ways to close health equity gaps in post-acute care reporting programs.

The proposed rule can be found here. A fact sheet is also available. Comments on the proposed rule are due on August 27th.
 
CMS Issues Proposed Rule Governing Exchanges for 2022 and Beyond
On June 28th, CMS issued a proposed rule regarding changes to regulatory requirements for Exchanges and health insurance markets for 2022 and beyond. Key provisions of the rule include: 

  • Extending annual open enrollment by one month – CMS proposes to extend the annual open enrollment period, which currently runs from November 1 – December 15, by one month, ending on January 15. This change would be effective for the 2022 plan year and beyond and apply to individual plans sold on and off any Exchange.
  • New Special Enrollment Period (SEP) for low-income individuals – CMS proposes to create a new, monthly SEP for Advance Premium Tax Credit (APTC)-eligible individuals with household income at or below 150% of the Federal Poverty Level (FPL). Issuers would not be required to offer this SEP off the Exchange (where applicants are unable to access the APTCs that, in part, trigger the proposed SEP).
  • Repeal of separate billing for abortion services – CMS proposes to repeal a Trump-era rule requiring qualified health plans (QHPs) that offer abortion services to separately bill enrollees for such services, requiring enrollees to make two payments: one for abortion services and one for all other services. The “double billing” requirement had not yet taken effect and was vacated by a district court judge in July 2020.
  • Repeal of October 2018 Section 1332 waiver guidance – Under Section 1332 of the Affordable Care Act (ACA), states may pursue changes to certain ACA requirements so long as the effect of such waivers will not limit coverage eligibility or make coverage less comprehensive and affordable. Guidance issued in October 2018 loosened these waiver guardrails, encouraging states to pursue alternatives to QHPs, such as association health plans and short-term limited duration insurance, and focus on the coverage residents are offered rather than the coverage residents actually purchase. In this rule, CMS proposes to repeal these less stringent requirements and provide additional information about the 1332 waiver requirements and approval processes.
  • Repeal of direct enrollment option – CMS proposes to repeal a recently-established direct enrollment option that would allow Exchanges to work directly with private sector entities to operate enrollment websites in lieu of government responsibility for Exchange operations. The proposed repeal would still permit direct enrollment activities, but they must supplement, not replace, state or federal government Exchange activities.

The proposed rule can be found here. A fact sheet is also available. Comments on the proposed rule are due July 28th.
 
CMS Proposes CY 2022 ESRD Payment Rule
On July 1st, CMS issued a proposed rule for the CY 2022 End-Stage Renal Disease (ESRD) prospective payment system (PPS). CMS projects that this rule would increase total payments to all ESRD facilities by 1.2 percent. For hospital-based facilities, CMS projects a decrease of 1.3 percent in total payments, while for freestanding facilities, it projects an increase of 1.2 percent. To update the ESRD outlier policy, CMS used CY 2020 data, since its analysis suggests there was no COVID-19-related effect on utilization. The rule also proposes: 

  • Updates to the Acute Kidney Injury (AKI) dialysis payment rate.
  • Modifications to the CMS Innovation Center’s (CMMI) ESRD Treatment Choices (ETC) model to focus on health equity by encouraging providers to reduce disparities in rates of home dialysis and kidney transplants among individuals with lower socioeconomic status.
  • Updated requirements for the ESRD Quality Incentive Program (QIP).
  • Solicitation of input on a variety of issues, including: 
    • Public input on issues pertaining to Medicare payment for peritoneal dialysis catheter placement;
    • A beneficiary experience measure for home dialysis;
    • Using the Fast Healthcare Interoperability Resources (FHIR) framework to support digital quality measurement;
    • COVID-19 vaccination measures to be included in the ESRD QIP;
    • Possible collection of a minimum set of demographic data elements to permit national interoperable health information exchange; and
    • Ways to close health equity gaps in the QIP.

The proposed rule can be found here. A fact sheet is also available. Comments may be submitted by August 31st.
 
CMS Revokes Medicaid Work Requirements in Two States
On June 24th, CMS officially notified Medicaid programs in Arizona and Indiana of the revocation of approval of provisions in each state’s Section 1115 waiver requiring that adults work or seek work in order to receive Medicaid benefits. This follows similar action CMS has taken with regard to work requirements in Arkansas, Michigan, New Hampshire, and Wisconsin.
 
CMS’s letter to Arizona is available here and its letter to Indiana is available here.

Other Updates

SCOTUS Declines to Hear Appeal Challenging HHS’ Site-Neutral Payment Policy
On June 28th, the Supreme Court declined to hear an appeal in a case challenging the site-neutral payments policy instituted by CMS in its 2019 Outpatient Prospective Payment System (OPPS) rule. The OPPS statute provides that courts may not review an HHS action that is “a method for controlling unnecessary increases in the volume of covered [outpatient] services.” The American Hospital Association (AHA) argued that the such methods must be budget-neutral, and a district court overturned the CMS rule in September 2019 on those grounds. However, in July 2020, the Court of Appeals for the District of Columbia overturned that ruling, stating that HHS made a reasonable interpretation of an ambiguous statue.  The AHA estimated that the rule cost providers about $380 million in 2019.
 
SCOTUS Accepts Several Health Care Cases for Next Term
Today (July 2nd), the Supreme Court accepted several new cases pertaining to health care issues for consideration during its next term. These include: 

  • AHA v. Becerra, a case challenging CMS’s cuts to reimbursement for 340B prescription drugs promulgated in the 2018 OPPS rule.
  • Becerra v. Empire Health Foundation, a case regarding the calculation of disproportionate share hospital adjustments to Medicare payments.
  • Gallardo v. Marstiller, a case in which Florida’s Medicaid program seeks to recover costs of prior care from a patient who received a civil settlement meant to pay for future treatment.
  • CVS Pharmacy v. Doe, a case concerning whether CVS’s policy on out-of-network rates for specialty medications disproportionately harms patients with HIV.

CDC Data Indicates Almost All COVID-19 Deaths Are Unvaccinated
On June 24th, the Associated Press released an analysis of all available government data from the Centers for Disease Control and Prevention on Covid-19 deaths. The analysis showed that nearly all COVID-19 deaths nationally are now in unvaccinated individuals. Of the 18,000 COVID-19 deaths that occurred in May 2021, only about 150 of them occurred in fully vaccinated people, or about 8%. Fully vaccinated people also accounted for fewer than 1,200 of more than 853,000 COVID-19 hospitalizations, or about .1% of all hospitalizations. Overall, deaths from COVID-19 peaked in January at 3,400 per day but have since fallen precipitously.
 
Study Finds 70% of Physicians are Employed by Hospitals or Corporate Entities
On June 28th, the Physicians Advocacy Institute, in collaboration with Avalere Health, published a study on physician employment trends and practice acquisitions in 2019-2020. The study showed that only 30% of physicians in the United States practiced medicine independently, as of the beginning of 2021. The remaining 70% of physicians are employed by hospital systems or other corporate entities such as private equity forms and health insurers. In total, 48,400 additional physicians left independent practice and became employees of hospitals or other corporate entities during the 2019-2020 period, with the COVID-19 pandemic accelerating these trends during the last half of 2020. In addition, hospitals and other corporate entities acquired 20,900 additional physician practices over the two-year period, a 25% increase.
 
Advisory Council on Alzheimer’s Research, Care, and Services to Discuss Aducanumab
 On June 29th, HHS published a notice that its Advisory Council on Alzheimer’s Research, Care, and Services will hold a virtual meeting to discuss “the implications of and opportunities presented by the approval of aducanumab” among other topics. Aducanumab is the first drug approved by the Food and Drug Administration (FDA) for the treatment of Alzheimer’s disease in several decades, but has sparked public controversy due to a lack of scientific evidence for its efficacy and the potential large impact on Medicare prescription drug spending.
 
The meeting will be held on July 19th at 12:30pm. The notice of public meeting is available here. 

Congressional Recess

The House and Senate are in recess until July 12th.

New York State Updates

Governor Cuomo Signs OMH Licensure Exemption Extension and Other Bills
Over the past week, Governor Cuomo signed the following health care-related bills: 

  • Assembly Bill A7504-A/Senate Bill S6431 extends for an additional year certain exemptions from professional licensure requirements for individuals employed as mental health practitioners, psychologists, and social workers in licensed programs, such as Office of Mental Health (OMH) licensed Article 31 clinics. This exemption was otherwise set to expire on June 24th.
  • Assembly Bill A6395-B/Senate Bill S7194 creates an Opioid Settlement Fund comprising all funds received by NYS as a result of a settlement or judgment in litigation against opioid manufacturers or related companies. Such funds should supplement and not supplant or replace existing state funding. The Opioid Settlement Fund will be monitored by the Office of Addiction Services and Supports (OASAS) and other state agencies to ensure that funding is expended for appropriate substance use disorder purposes.
  • Assembly Bill A7659/Senate Bill S6801 maintains for an additional two years (through June 30, 2023) existing consumer protections that make consumers aware of changes to network coverage under their health plan and requires, under certain circumstances, hospitals and health plans to continue to abide by contracts following a termination for two months or until the end of the contract period.
  • Assembly Bill A7688/Senate Bill S6312 amends the New York State Medical Care Facilities Finance Agency Act to increase the maximum permitted amount of certain issued hospital and nursing home project bonds and notes.
  • Assembly Bill A7660/Senate Bill S6896 extends for two years (through July 1, 2023) provisions that establish premiums under Child Health Plus and presumptive eligibility protections for children in the program.
  • Assembly Bill A7658/Senate Bill S7059 extends provisions of certain laws related to licensed home care service agencies (LHCSAs) through June 30, 2023 in order to avoid the expiration of those laws during the end of the state budget cycle.
  • Assembly Bill A7945/Senate Bill S7055 extends the demonstration project that allows for the provision of physical, occupational, and speech therapy by a residential health care facility at an off-site location until June 2024.
  • Assembly Bill A7670/Senate Bill S7062 makes the existing pilot emergency medical services (EMS) recertification program permanent.
  • Assembly Bill A7684/Senate Bill S7108 allows the Justice Center to provide a summary of any final findings of Category Two conduct of employees or volunteers of facilities licensed, certified, or operated by the Office for People with Developmental Disabilities (OPWDD), even if the conduct occurred at another facility or provider agency.

DOH Announces Prior Authorization Minimum Data Set Policy Effective August 1st
On July 1st, the New York State Department of Health (DOH) announced implementation of the Prior Authorization Minimum Data Set Policy effective August 1st. This policy, which was part of a set of proposals developed by the second Medicaid Redesign Team (MRT II), aims to improve the submission of Prior Authorization Requests to Medicaid Managed Care Plans (MMCPs) by creating a standard prior authorization data set with the minimum information required for MMCPs to accept and begin reviewing a request. While it is not mandatory for MMCPs to implement this policy, DOH anticipates that use of this data set will lower the number of service request denials and appeals due to lack of basic information.
 
MMCPs that choose to implement this policy must follow the guidelines outlined here and notify network providers prior to implementation. If an MMCP chooses not to implement this policy, it must continue to accept and make a determination on all Prior Authorization Requests submitted by a provider.
 
Questions may be submitted to URAgent@health.ny.gov.
 
Updates on NYS COVID-19 Regulatory Flexibilities Post-Executive Order 202
Following the expiration of New York’s state-level disaster emergency declaration for COVID-19 on June 24th, various NYS agencies have issued guidance clarifying the status of emergency COVID-19 policies and are planning further clarifications.
 
To assist clients in keeping track of relevant changes, SPG has updated the document we distributed earlier in the week containing the following: 

  • An updated version of SPG’s Waiver Timeline Tracker document to show in detail the status of these policies;
  • A summary of NYS agency policies and guidance released so far; and
  • A brief summary of the continued application of federal PHE-related policies.

The updated document can be found here.