Weekly Health Care Policy Update – July 9, 2021

July 16, 2021

In this update: 

  • Biden Administration Announces Updates on COVID-19 Response 
    • CDC and FDA Say Vaccine Boosters Not Needed Now
    • U.S. COVID-19 Global Response and Recovery Framework
    • Recovery Act Funding for Children with Disabilities
    • CMS Updates CAAP FAQs
  • Biden Issues Executive Order on Promoting Competition
  • CMS Announces Director of Center for Medicare
  • CMS Issues Basic Health Program Funding Methodology for 2022
  • HRSA Updates Lists of HPSAs
  • HHS OIG Issues Opinion on Medigap Plan’s Use of Preferred Hospital Network
  • FDA Issues Clarification Narrowing Scope of Patients for Aducanumab
  • House Committee on Oversight and Reform Issues Staff Report on Pharmaceutical R&D
  • CDC Data Describes Urban-Rural Divide in Dental Care
  • UnitedHealthcare Enacts Policy to Deny Out-of-Network Non-Emergency Claims Outside Service Area
  • Congressional Hearings
  • Governor Cuomo Signs Legislation Extending Long Term Care Ombudsman Program and Other Bills
  • OMH Releases Community Mental Health Services Block Grant Supplementary Funding Report
  • OMH Updates Part 599 Clinic Regulations and Guidance
  • DOL Releases Airborne Infectious Disease Exposure Prevention Standard and Plan
  • 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: 

  • CDC and FDA Say Vaccine Boosters Not Needed Now: On July 8th, the Centers for Diease Control and Prevention (CDC) and Food and Drug Administration (FDA) jointly released a statement that individuals fully vaccinated against COVID-19 do not currently need to receive booster shots. The statement was in response to a notice by Pfizer that it is developing such a booster shot, which it believes will be necessary to protect from COVID-19 variants.
  • U.S. COVID-19 Global Response and Recovery Framework: On July 1st, the Biden Administration released its COVID-10 Global Response and Recovery Framework. The Framework’s overarching goal is to “end the pandemic; mitigate its wider harms to people and societies; and strengthen the global recovery and readiness for future pandemic threats.” The Framework identifies five objectives the U.S. aims to achieve through a “whole of government” response. A press release and the Framework are available.
  • Recovery Act Funding for Children with Disabilities: On July 1st, the Department of Education announced the availability of $3 billion in funding from the American Rescue Plan Act to support children with disabilities. This funding to states will increase resources available through Individuals with Disabilities Education Act grant programs, which serve infants and toddlers, preschoolers, and children and youth with disabilities through age 21. A press release and fact sheet are available. 
  • CMS Updates CAAP FAQs: On July 8th, the Centers for Medicare & Medicaid Services (CMS) released updated frequently asked questions (FAQs) regarding COVID-19 Accelerated and Advanced Payment (CAAP) repayment and recovery. The document provides information on CAAP recoupment, including details on specific circumstances providers may face, such as shared Taxpayer Identification Numbers (TINs), extended repayment schedules, and deferred recoupments. In general, the document directs providers to contact their Medicare Administrative Contractor (MAC) with questions about their specific situation. The FAQs are available here.

Biden Issues Executive Order on Promoting Competition
On July 9th, the White House announced that President Biden will issue an executive order with 72 initiatives across federal agencies as part of a “whole-of-government effort to promote competition in the American economy.” Some health care-related provisions of the order include:
 
Hospitals

  • Encourages the Justice Department and FTC to review merger guidelines and antitrust enforcement regarding harmful hospital mergers.
  • Directs HHS to support existing hospital price transparency rules and to finish rulemaking on surprise billing.

Health Insurance

  • Directs HHS to “standardize plan options in the National Health Insurance Exchange” to allow for easier comparison shopping.

Labor

  • Encourages the Federal Trade Commission (FTC) to consider banning “unnecessary occupational licensing restrictions.”

Pharmacy

  • Directs FDA to work with states to safely import prescription drugs from Canada.
  • Directs the Department of Health and Human Services (HHS) to increase support for generic and biosimilar drugs, and to issue a comprehensive plan within 45 days to combat high prescription drug prices.
  • Encourages the FTC to consider banning “pay for delay” and similar arrangements between branded and generic drug manufacturers.

Hearing Aids

  • Directs HHS to issue proposed rules within 120 days for allowing hearing aids to be sold over the counter.

A full fact sheet is available here.
 
CMS Announces Director of Center for Medicare
On July 6th, CMS announced the appointment of Meena Sheshamani, MD, PhD, as Deputy Administrator and Director of the Center for Medicare. Dr. Sheshamani most recently served as Vice President of Clinical Care Transformation at MedStar Health in the D.C.-Baltimore area. Prior to MedStar, Dr. Seshamani was Director of the Office of Health Reform at HHS during the Obama administration, where she led implementation of the Affordable Care Act (ACA). A press release is available here.

Regulatory Updates

CMS Issues Basic Health Program Funding Methodology for 2022
On July 7th, CMS published in the Federal Register the final methodology and data sources required to set federal payments for program year 2022 to states that establish a Basic Health Program (BHP). Currently, only two states, New York and Minnesota, operate a BHP. The ACA permits states to offer a BHP program to individuals with household income between 138 and 200% of the federal poverty level (FPL), or lawfully present citizens with incomes below 138% of FPL (who are ineligible for Medicaid). Such individuals would otherwise be eligible to purchase coverage through Exchanges.
 
The final rule makes adjustments related to federal funding for the BHP due to changes included in the American Rescue Plan Act of 2021 (ARP), which increases BHP funding in several ways.

  • The ARP increased the amount of advance premium tax credits (APTCs) available to Exchange enrollees. Since BHP payments are set by a formula whose base is 95 percent of the APTCs and cost-sharing reductions that enrollees would otherwise receive, states operating a BHP will receive correspondingly higher payments as well.
  • Additionally, because the household premium contribution is reduced, the Income Reconciliation Factor in the calculator also increases (from 99.01% to 100.63%). These two changes together are expected to result in an increase in BHP expenditures of $853 million.
  • Because the ARP makes silver-level plans free for many more consumers, the Metal Tier Selection Factor (adjusting for individuals who would choose bronze-level plans) has been removed. This results in an increase of BHP payments of $261 million.

As a result, CMS expects federal expenditures on the BHP to increase by $1.11 billion, from $6.74 billion to $7.85 billion.
 
The final methodology is available here. 
 
HRSA Updates Lists of HPSAs
On July 6th, the HHS Health Resources and Services Administration (HRSA) announced the availability of complete lists of all Health Professional Shortage Areas (HPSAs) designated as of April 30, 2021. The updated lists reflect primary care, dental health, and mental health shortage areas.
 
The Federal Register notice is available here and the updated lists may be accessed here.
 
HHS OIG Issues Opinion on Medigap Plan’s Use of Preferred Hospital Network
On July 7th, the Department of Health and Human Services (HHS) Office of the Inspector General (OIG) issued an advisory opinion regarding a proposal from a Medigap plan to incentivize enrollees to use a “preferred hospital” network. Under the proposed arrangement, the Medigap plan would contract with preferred hospitals to provide discounts on any applicable Medicare inpatient deductibles for enrollees. The Medigap plan would subsequently provide a $100 credit off the next renewal premium for enrollees who used a network hospital for an inpatient stay.
 
The OIG’s opinion states that, although the proposed arrangement would be in violation of both the Federal Anti-Kickback Statute and the Beneficiary Inducements Civil Monetary Penalty, OIG would exercise administrative discretion to not impose sanctions on the Medigap plan or the preferred hospital under either statute. To support its opinion, OIG states that it believes it is unlikely that the discounts and premium credit would result in overutilization of health care services or increase costs to the Federal government, that the potential for patient harm is minimal, and that the payments would be unlikely to significantly impact competition.
 
The opinion is available here.

Other Updates

FDA Issues Clarification Narrowing Scope of Patients for Aducanumab
On July 8th, Biogen issued a press release stating that the FDA had approved updated labeling for its new drug Aduhelm (aducanumab), a controversial new treatment for Alzheimer’s disease. The new label indicates that Aduhelm should be used for patients “with mild cognitive impairment or mild dementia stage of disease,” and that there is no safety or effectiveness data for treatment at earlier or later stages. This change is expected to reduce the number of patients who would be prescribed the drug.
 
The press release is available here.
 
House Committee on Oversight and Reform Issues Staff Report on Pharmaceutical R&D
On July 8th, Representative Carolyn Maloney (D-NY), the Chair of the Committee on Oversight and Reform, released a committee staff report on pharmaceutical prices. The report examines financial reports from the 14 largest drug companies and finds that collectively, the companies spent more on stock buybacks, dividends, and executive compensation than on research and development. The report is in support of prescription drug pricing reforms in the Lower Drug Prices Now Act currently under consideration in the House.
 
The report is available here. A press release is available here.
 
CDC Data Describes Urban-Rural Divide in Dental Care
On July 7th, the Centers for Disease Control and Prevention (CDC) released a data brief that highlights geographic and other differences in dental care use among adults aged 18-64. Analyzing 2019 data, researchers found that 65.5% of adults had a dental visit in the previous 12 months. Adults in urban areas (66.7%) were more likely to have a dental visit in the past 12 months than adults in rural areas (57.6%). In both urban and rural areas, women were more likely to have a dental visit than men and non-Hispanic white adults were more likely to have a dental visit than Hispanic or non-Hispanic black adults. Overall, dental care use increased with family income.
 
The data brief is available here.
 
UnitedHealthcare Enacts Policy to Deny Out-of-Network Non-Emergency Claims Outside Service Area
Effective July 1st, UnitedHealthcare’s fully insured and individual market commercial health coverage plans will begin to implement a new policy not to cover of non-emergency out-of-network benefits when provided outside of a beneficiary’s service area. This applies to medical and behavioral health services for services subject to prior authorization. The policy is being rolled out in phases and is expected to be implemented fully by mid-2022.
 
The policy notice is available here.

Congressional Updates

Tuesday, July 13th:

  • At 2:30pm, the Senate Judiciary Subcommittee on Competition Policy, Antitrust, and Consumer Rights will hold a hearing entitled “A Prescription for Change: Cracking Down on Anticompetitive Conduct in Prescription Drug Markets.” More information is available here. 

Wednesday, July 14th:

  • At 12pm, the House Science, Space, and Technology Subcommittee on Investigation and Oversight will hold a hearing entitled “Principles for Outbreak Investigation: COVID-19 and Future Infectious Diseases.” More information is available here. 

Thursday, July 15th:

  • At 12pm, the House Financial Services Subcommittee on Oversight and Investigations will hold a hearing on the Community Development Block Grant (CDBG) program entitled “CDBG Disaster Recovery: States, Cities, and Denials of Funding.” More information is available here.

New York State Updates

Governor Cuomo Signs Legislation Extending Long Term Care Ombudsman Program and Other Bills
Governor Cuomo recently signed the following health care-related bills: 

  • Assembly Bill A4594A/Senate Bill S5506A permits all beds in hospice residences to be dually certified as both hospice and inpatient beds. Hospice residences were previously permitted to have dually certified hospice inpatient beds only up to 25 percent of the hospice residence’s patient capacity.
  • Assembly Bill A7022/Senate Bill S6740 extends for two years (through December 31, 2023) the authorization of the Long Term Care Ombudsman Program to advocate on behalf of managed long term care participants.

OMH Releases Community Mental Health Services Block Grant Supplementary Funding Report
On July 1st, the New York State Office of Mental Health (OMH) released the Community Mental Health Services (CMHS) Block Grant Supplementary Funding Report, which outlines OMH’s key priorities and potential investments within the mental health system that could be supplemented by additional CMHS Block Grant Funds. Under the Coronavirus Response and Relief Supplemental Appropriation Act, the federal government allocated over $46 million to NYS in supplemental block grant funding to be expended by March 14, 2023. Through the American Rescue Plan Act, the federal government allocated an additional $80 million to NYS to be expended from September 1, 2021 to September 30, 2025.
 
Following an analysis of stakeholder feedback regarding the use of CMHS block grant supplemental funding, OMH plans to focus on the following areas: 

  • Early diagnosis and intervention (including first episode psychosis);
  • Support for children, youth, and families (including school-based services, home and community-based services, and crisis intervention);
  • Robust community services (including a comprehensive and coordinated crisis response system);
  • Justice-involved populations (including training of law enforcement, diversion programs, and services for individuals exiting incarceration);
  • Transformation of the mental health system towards ambulatory recovery-oriented treatment and support services, including the integration of physical health and substance use disorder treatment; and
  • Implementation of specific strategies on payment parity and provider sustainability, with the aim of reducing disparities in access and treatment outcomes.

Accordingly, OMH intends to prioritize the following key areas for the initial $46 million block grant: 

  • Statewide Crisis Services, including a statewide 988 crisis call center network and start-up/expansion funding for crisis residences and crisis stabilization centers.
  • Child, Youth, and Family Services, including expansion of Youth Assertive Community Treatment (ACT) programs.
  • Adult Ambulatory Services, including telehealth expansion/support and ACT program enhancements.
  • Mental Health Workforce/System Capacity Building, including investment in recruitment and retention of culturally competent employees and training/implementation support.

OMH has requested certain waivers for the use of these funds, including: 

  • Waiver from the exclusion of capital expenditures as an allowable expense of funds, (for crisis phone line infrastructure);
  • Waiver of the prohibition of funding a for-profit entity (for hardware and software and/or training needed for a crisis line and/or crisis services); and
  • Waiver of the target population (to fund services to at-risk children, youth, and families prior to a diagnosis of serious emotional disturbance).

The report, which includes initial funding allocations for select initiatives, is available here.
 
OMH Updates Part 599 Clinic Regulations and Guidance
Effective July 15th, OMH-regulated providers should begin using an updated Clinic Standards of Care Anchor Element (available here). This element was updated in May to align with OMH’s August 2020 revisions to Part 599.10 regulation, which: 

  • Clarify the difference in requirements between Medicaid fee-for-service beneficiaries and those of other payors;
  • Remove discharge criteria from the contents of the initial treatment plan;
  • Reduce minimum requirements of treatment plan reviews from 90 days to no less than annually;
  • Allow for agency autonomy for the documentation of the treatment plan; and
  • Clarified physician and individual/family signature requirements for treatment plans.

Changes to the document are outlined in a recent OMH webinar that can be accessed here. Questions may be sent to omh.sm.adult-clinic@omh.ny.gov for adult clinics and to the provider’s Field Office or the Central Office at diana.manganelli@omh.ny.gov for children’s clinics.
 
OMH also updated the Part 599 Guidance Document (available here) to reflect that effective January 1, 2021, the American Medical Association (AMA) has discontinued the use of CPT code 99201.
 
DOL Releases Airborne Infectious Disease Exposure Prevention Standard and Plan
The NYS Department of Labor (DOL), in consultation with the NYS Department of Health (DOH), has developed an Airborne Infectious Disease Exposure Prevention Standard, a Model Airborne Infectious Disease Exposure Prevention Plan, and various industry-specific model plans for the prevention of airborne infectious disease. These documents have been developed in accordance with the NY HERO Act, which requires employers to implement infection control practices in response to the COVID-19 pandemic and protect employees against exposure during a future airborne infectious disease outbreak.
 
Employers must adopt the DOL’s standard airborne infectious disease exposure prevention plan or establish an alternative plan that equals or exceeds the minimum requirements. Plans must go into effect when an airborne infectious disease is designated by the New York State Commissioner of Health as a highly contagious communicable disease that presents a serious risk of harm to the public health. However, currently there is no such designation in effect related to COVID-19 or any other indication.
 
The Airborne Infectious Disease Exposure Prevention Standard is available here and the Model Airborne Infectious Disease Exposure Prevention Plan is available here. Spanish versions of these plans are forthcoming. Additional details regarding requirements under this law are expected from DOL in the near future. Feedback and inquiries may be submitted to DOL here.
 
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. Updated guidance since last week from state agencies is outlined below and in SPG’s updated tracking document, which can be found here.
 
Department of Health (DOH)
DOH issued a memo (available here) to hospital executives and nursing home administrators notifying them that the requirements for Article 28 general hospitals to obtain a negative COVID-19 test result prior to discharge to a nursing home or adult care facility have expired. However, DOH strongly encourages hospitals to test patients for COVID-19 prior to discharge to any congregate care setting, including nursing homes and adult care facilities and sharing those results with the accepting facility. Hospitals that fail to disclose a positive COVID-19 test to the accepting facility, or which fail to disclose whether the patient is still on Transmission-Based Precautions, may be cited for violation of discharge obligations and referred for enforcement. The guidance includes a reminder that nursing homes should only accept residents for whom they are capable of providing appropriate and necessary care.
 
In addition, DOH has updated visitation guidance for nursing homes (here) and adult care facilities (here). DOH also issued a notice that effective June 25, 2021, in accordance with the end of the State Disaster Emergency, the health care provider guidance on suspended health plan utilization review requirements (available here) has expired.
 
Office for People with Developmental Disabilities (OPWDD)
OPWDD released post-State of Emergency COVID-19 guidance (available here) for OPWDD certified, operated, and/or funded facilities and programs. The guidance indicates that effective June 25, 2021, providers may: 

  • Operate programs at full capacity to the extent possible;
  • Resume unrestricted visitation at community outings from residential facilities; and
  • Remove capacity limitations during transportation if all individuals are vaccinated.

The guidance also confirms that fully vaccinated individuals are no longer required to wear masks or maintain social distance within OPWDD programs. However, individuals and staff are required to wear masks (to the extent they can medically tolerate one), regardless of vaccination status while being transported between OPWDD certified locations or as part of an OPWDD certified services (e.g. from a residence to a day program). Facilities should continue to clean and disinfect high-touch services in accordance with current guidance. Residential facilities with positive COVID-19 cases should continue to adhere to established protocols. All providers should continue to report the vaccination status of individuals and staff and any positive COVID-19 cases to OPWDD.
 
OPWDD also released updated guidance (available here) regarding the use of telehealth, which indicates that current telehealth provisions are in place for the duration of the federal public health emergency (PHE) for all services except those governed by the OPWDD Home and Community Based Services (HCBS) Waiver, for which flexibilities will continue for six months following the end of the PHE.