Weekly Health Care Policy Update – August 8, 2022

In this update: 

• Administration Updates
  • Biden Administration Declares Public Health Emergency for Monkeypox
  • Biden Administration Secures 66 Million Doses of Moderna’s Variant-Specific Covid-19 Vaccine
  • Biden Signs Executive Order to Protect Travel for Abortion
• Legislative Update
  • Senate Passes Inflation Reduction Act
• Federal Agencies
  • CMS Issues FY 2023 Hospital IPPS and LTCH PPS Final Rule
  • CMS Finalizes FY 2023 Skilled Nursing Facility Payment Policies
  • CMS Publishes Guidance for ACE Kids Act Health Home Benefit
  • Administration Issues FAQs on Coverage of Contraception as a Preventive Service
  • HHS and DOJ Issue Guidance on Nondiscrimination in Telehealth
  • HHS Report Finds Uninsured Rate at Historic Low of 8%
• Other Updates
  • DOJ Sues Idaho Over Restrictive Abortion Law
  • NCQA Announces New Equity-Focused Measures for HEDIS 2023
• New York State Updates
  • NYS Launches Health Care and Mental Hygiene Worker Bonus Program and Submission Portal
  • Governor Hochul Extends Disaster Emergency Due to Health Care Staffing Shortages
• Funding Opportunities
  • NYC DSS and HRA Release Round 3 Scattered-Site Supportive Housing RFP

Administration Updates

Biden Administration Declares Public Health Emergency for Monkeypox
On August 4^th, the Department of Health and Human Services (HHS) declared a Public Health Emergency (PHE) in response to the monkeypox outbreak, which has reached nearly 9,000 cases as of today (August 8^th). The declaration allows the Administration to access additional funding, have additional flexibilities regarding federal rules and regulations, as well as appoint personnel to positions directly responding to the emergency. It will last for 90 days, unless extended further. President Biden also named a White House monkeypox coordinator, Robert Fenton, who is a Regional Administrator at the Federal Emergency Management Agency.
 
Biden Administration Secures 66 Million Doses of Moderna’s Variant-Specific Covid-19 Vaccine
On July 29^th, HHS, in collaboration with the U.S. Department of Defense (DoD), announced an agreement to purchase 66 million doses of Moderna’s bivalent Covid-19 vaccine booster candidate for potential use this fall and winter. The purchase adds to the 105 million bivalent Covid-19 vaccine boosters the U.S. government has already purchased from Pfizer for potential use later this year. Both vaccines will require authorization by the Food and Drug Administration (FDA) and recommendation by the Centers for Disease Control and Prevention (CDC) before they can be administered. The contracts with both Moderna and Pfizer include options for purchasing a total of 600 million doses if Congress allocates the necessary funding.
 
More information is available here.
 
Biden Signs Executive Order to Protect Travel for Abortion
On August 3^rd, President Biden signed an Executive Order aimed at protecting access to reproductive health care services for individuals traveling across state lines to receive them. Specifically, the order directs HHS to “consider actions to advance access to reproductive healthcare services, including, to the extent permitted by Federal law, through Medicaid, for patients traveling across State lines for medical care.” It is unclear how HHS will implement this directive due to the ongoing prohibition on the use of federal funds for abortions except in extremely limited circumstances.
 
The order also directs HHS to evaluate and improve research, data collection, and data analysis efforts regarding “the effect of access to reproductive healthcare on maternal health outcomes.” Biden signed the order during the first meeting of the interagency Task Force on Reproductive Healthcare Access.
 
The Executive Order is available here and a fact sheet is available here.

Legislative Update

Senate Passes Inflation Reduction Act
On August 7^th, the Senate passed the Inflation Reduction Act of 2022 on a party-line vote (51-50). The major health care provisions in this version of the Act were largely unchanged from the previous draft versions, focused on prescription drug pricing and an extension of the enhanced Marketplace subsidies from the American Rescue Plan (ARP) through plan year 2025. The major prescription drug provisions include:

• In Medicare Part D, removal of the 5 percent coinsurance above the catastrophic threshold in 2024, and establishment of an overall $2,000 cap on out-of-pocket Medicare Part D costs starting in 2025.
• The Drug Price Negotiation Program, which will allow the Centers for Medicare and Medicaid Services (CMS) to negotiate drug prices for certain high-cost drugs in Medicare. 
  • The Program would begin in 2026, with negotiations on up to 10 drugs, increasing by 2028 to cover up to 20 drugs.
  • Only single-source drugs that have been approved for at least 9 years (or 13 years for biologicals) and are among the 50 highest-cost drugs (by total expenditures) under Part B or Part D would be eligible for selection, except for insulin products, which would be eligible throughout.
  • The Program would establish a ceiling for possible negotiated prices. The ceiling would be a percentage (between 40 and 75 percent) of the average manufacturer price in 2021, adjusted for inflation.
  • Manufacturers who do not offer a price under the ceiling may be subject to civil monetary penalties. Additionally, if negotiations continue for too long, an increasing excise tax on the drug’s revenues may be applied.
  • 340B purchasers would be able to purchase drugs at the lower of the 340B price or the Medicare negotiated price.
• A requirement that manufacturers of drugs whose prices increase faster than inflation provide a rebate to Medicare (whether Part B or Part D), starting in 2023. Unlike in the original version, this will not apply to private insurance.
• A maximum monthly cost-sharing for insulin of $35 in Medicare, starting in 2023. Starting in 2026, the cap could be lowered to either 25 percent of the established maximum fair price or 25 percent of the negotiated Medicare price, if these are lower than $35.
• Removal of the phase-in of the Low Income Subsidy (LIS) between 135 and 150 percent of the federal poverty line (FPL), so that all individuals with incomes up to 150 percent of FPL are eligible for the full LIS.
• A cap of 6 percent on premium increases in Part D.

The bill will now move back to the House of Representatives for consideration this week. The full text of the bill is available here.

Federal Agencies

CMS Issues FY 2023 Hospital IPPS and LTCH PPS Final Rule
On August 1^st, CMS issued its final rule on the fiscal year (FY) 2023 Medicare Hospital Inpatient Prospective Payment System (IPPS) and Long-Term Care Hospital (LTCH) Prospective Payment System (PPS). Overall, CMS estimates the final rule will increase operating payment rates to IPPS-paid hospitals that successfully participate in the Hospital Inpatient Quality Reporting (IQR) Program and are meaningful electronic health records (EHR) users by 4.3% ($2.6 billion) in 2023. This is a 1.1 percentage point ($1 billion) increase from the proposed rule. LTCH payments are estimated to increase by $71 million, reflecting an estimated 2.3% increase in the standard LTCH payment rate, both substantial increases from the proposed rule.
 
CMS finalized its return to the usual practice of using the most recent available data to set FY 2023 rates (FY 2021 MedPAR claims and FY 2020 cost reports) with some modifications to account for an anticipated decline (though not elimination) of Covid-19 hospitalizations in FY 2023 relative to FY 2021.
 
Some highlights of the final rule include: 

• Revised and new requirements for eligible hospitals and Critical Access Hospitals (CAHs) participating in the Medicare Promoting Interoperability Program.
• An effective suspension of the Hospital Value-Based Purchasing (VBP) Program for FY 2023 (each participating hospital will receive an incentive payment equal to their reduction), as well as newly established performance standards and other updates to the program. This policy was finalized as proposed.
• An effective suspension of the Hospital-Acquired Condition (HAC) Reduction Program for FY 2023 (all six measures would be suspended, and no hospital would be scored), as well as other updates to the program. This policy was finalized as proposed.
• The adoption of ten measures in the Hospital Inpatient Quality Reporting (IQR) Program, as well as other changes, including the “Birthing-Friendly” designation.
• Updated policies for a number of programs, including: 
  • Hospital Readmissions Reduction Program;
  • PPS-Exempt Cancer Hospital Reporting Program; and
  • LTCH Quality Reporting Program.
• The continuation of FY 2020 wage index policies affecting low wage index hospitals, and the enactment of a 5% limit on year-to-year decreases in wage indexes (as proposed in other recent payment rules).
• Changes to graduate medical education (GME) policies, including: 
  • An adjustment for situations when a hospital’s weighted full-time equivalent (FTE) count is greater than its FTE cap; and
  • Flexibility for teaching hospitals that cross-train residents.
• Revisions to hospital and CAH conditions of participation for infection prevention and control, antibiotic stewardship, and to require continued reporting of Covid-19 and seasonal influenza reporting after the conclusion of the current PHE. CMS finalized this rule as proposed, though with narrowed scope by eliminating reporting requirements related to: (1) suspected patient and staff Covid-19 infections; (2) confirmed staff Covid-19 and flu infections; (3) staff deaths due to Covid-19 and the flu; and (4) confirmed co-occurring Covid-19 and flu infections in staff.

The final rule is available here, a press release is available here, and a fact sheet is available here.
 
CMS Finalizes FY 2023 Skilled Nursing Facility Payment Policies
On July 29^th, the Centers for Medicare and Medicaid Services (CMS) finalized a rule updating Medicare payment policies and rates for skilled nursing facilities (SNFs) in fiscal year (FY) 2023. These policy changes will take effect October 1, 2022. In a reversal from the proposed rule, Medicare Part A payments to SNFs are estimated to increase by $904 million in FY 2023, rather than decrease by approximately $320 million as proposed. This amount reflects the net impact of a proposed increase in payment rates of 5.1% (up from 3.9% in the proposed rule), due to market basket and productivity adjustments, and a 4.6% reduction in rates related to recalibration of the Patient Driven Payment Model (PDPM). The PDPM, when implemented, was intended to be budget-neutral, but CMS has observed an increase in payments of approximately 5% ($1.7 billion in FY 2020), and the 4.6% reduction adjusts for this. CMS notes that this proposed adjustment reflects stakeholder feedback to better account for the impact of Covid-19 on SNFs.
 
The proposed rule included a Request for Information (RFIs), on establishing minimum staffing requirements for long-term care (LTC) facilities. In the final rule, CMS acknowledged that it received significant response from a wide range of interested parties. CMS reiterated its intention to propose minimum staffing requirements for LTC facilities within one year.
 
The rule also includes several direct policy proposals: 

• Permanent cap on wage index decreases: CMS finalized a permanent 5% cap on annual wage index decreases to help smooth annual changes in these payments.
• Proposed changes to PDPM ICD-10 code mapping: CMS finalized several changes to how ICD-10 codes are used to assign patients to clinical categories under several PDPM components, including the Physical Therapy, Occupational Therapy, Speech Language Pathology, and Non-Therapy Ancillary components.

The rule also finalized several changes to the SNF Quality Reporting Program (QRP), including: 

• Adopting the Influenza Vaccination Coverage among Healthcare Personnel (HCP) measure, beginning in FY2024, one year earlier than proposed;
• Revising the compliance date for some SNF QRP reporting requirements, including the Transfer of Health Information measures and some standardized patient assessment data, to October 1, 2023;
• While CMS sought input on future measure concepts related to health equity, self-care and mobility items, Covid-19 vaccination for SNF residents, CMS did not respond to comments in this final rule but will continue to consider comments as it develops future policies; 

Finally, the rule finalizes changes to the SNF VBP program, including: 

• Suppressing the SNF 30-day all-cause readmission measure for FY 2023, due to the impact of Covid-19;
• A proposed special scoring policy which would result in all qualifying SNFs receiving an identical incentive payment multiplier and eliminate ranking for the FY 2023 SNF VBP program; and
• Adopting three new measures: 
  • In FY 2026, a SNF Healthcare Acquired Infections (HAI) Requiring Hospitalization measure and a Total Nursing Hours per Resident Day Staffing measure, and
  • In FY 2027, adding a Discharge to Community-Post-Acute Care measure.

The final rule may be found here. In addition, a fact sheet on the proposed rule is available here and a press release may be found here.
 
CMS Publishes Guidance for ACE Kids Act Health Home Benefit
On August 1^st, CMS published a State Medicaid Director (SMD) letter with guidance on a new Medicaid Health Home benefit for children with medically complex conditions. Medically complex conditions include serious health concerns such as cerebral palsy, cystic fibrosis, blood diseases, and mental health conditions, which may often require traveling out-of-state for needed services. This new option was passed into law in 2019 as part of a package of Medicaid reforms, and was also known as the Advancing Care for Exceptional Kids (ACE Kids) Act.
 
Like the existing Section 2703 Medicaid Health Home option under the Affordable Care Act (ACA), Health Homes operating under the ACE Kids provision will provide the six core Health Home services, based around comprehensive care management. However, ACE Kids Health Homes must limit enrollment to children with significant chronic conditions. States may apply for planning grants for the purposes of developing a State Plan Amendment (SPA) for an ACE Kids Health Home, which may be award beginning October 1, 2022.
 
The guidance offers information to states about details of the benefit, including payment methodologies, provider standards, reporting, monitoring, and state assurance requirements. However, it does not include a comparison between the two types of Health Home model. Notably, if approved, states will be eligible for a 15 percentage point increase in their Federal Medical Assistance Percentage (FMAP) to a maximum of 90 percent for their expenditures on health home services during the first two fiscal year quarters that their SPA is in effect, whereas existing ACA Health Homes receive a flat 90 percent FMAP for eight quarters.
 
The SMD letter is available here.
 
Administration Issues FAQs on Coverage of Contraception as a Preventive Service
On July 28^th, HHS, along with the Department of Labor and the Department of the Treasury, issued subregulatory guidance in the form of a frequently asked questions (FAQs) document regarding access to preventive health services, specifically contraception, under the ACA. The ACA requires insurers to provide coverage of preventive services and may only use “reasonable” medical management techniques. The guidance was issued in response to “increasing complaints” from patients who allege they were denied access to these services, and reminds insurers that they may face excise taxes or civil monetary penalties if they wrongfully deny services and fail to revise their protocols, notify enrollees of the violation, and rescind denied claims.
 
Notably, the Departments assert that the federal requirement on plans to provide access to preventive items and services (including contraception and emergency contraception) without cost-sharing preempts any state law that may prevent application of the requirement. The Departments note that if a state passes a law preventing insurers from covering an FDA-approved, cleared, or granted contraceptive product or service, HHS may initiate a process whereby it assumes enforcement control of that provision in that state.
 
While much of the guidance is a restatement of previously-issued guidance, it does offer insurers some additional information regarding how plans may determine whether a medical management technique is “reasonable” with regard to the frequency, method, treatment, or setting for coverage of a recommended preventive health item or service, and whether the plans’ exceptions process is “easily accessible, transparent, sufficiently expedient, and not unduly burdensome. Specifically, the new guidance includes: 

• Examples of “unreasonable” medical management, such as imposing an age limit, denying coverage even after a medical provider determines a product is medically necessary, or requiring individuals to fail first using other contraceptive categories or using “numerous” other contraceptives in the same category.
• A definition of “easily accessible” to mean that plan documentation includes various information on how to access the plan’s exception process, including contact information.
• A definition of “transparent” to mean that information relevant to the exceptions process is prominently displayed in plan documents and any other materials that describe the plan’s contraceptive coverage.
• A recommendation that plans should develop and utilize a standard form and instructions “similar to the Medicare Part D Coverage Determination Requestion Form.”

The FAQs may be found here.
 
HHS and DOJ Issue Guidance on Nondiscrimination in Telehealth
On July 29^th, HHS and the Department of Justice published guidance on protections in federal nondiscrimination laws that require telehealth to be accessible to people with disabilities and limited English proficiency. The guidance highlights protections within multiple federal laws including the Americans with Disabilities Act, Section 504 of the Rehabilitation Act of 1973, Title VI of the Civil Rights Act of 1964, and Section 1557 of the Patient Protection and Affordable Care Act, and is intended to help providers “better understand their nondiscrimination obligations and patients better understand their rights under federal laws in their area.” It covers scenarios such as the use of screen reader software, the use of an interpreter to join a telehealth appointment from a separate location, and instructions for setting up telehealth appointments in non-English languages.
 
The full guidance is available here.
 
HHS Report Finds Uninsured Rate at Historic Low of 8%
On August 2^nd, the HHS Office of the Assistant Secretary for Planning and Evaluation (ASPE) released a report that found that the national uninsured rate dipped to an historic low of 8.0% in the first quarter of 2022. The previous record low rate was 9.0%, reached in 2016. The authors point to recent Medicaid expansions in several states, Medicaid’s continuous enrollment requirement under the Covid-19 PHE, and the enhanced ACA subsidies included in the ARP as contributing to increasing rates of health insurance coverage.
 
The ASPE report is available here, and a press release is available here.

Other Updates

DOJ Sues Idaho Over Restrictive Abortion Law
On August 2^nd, the Department of Justice (DOJ) filed a lawsuit challenging the state of Idaho’s restrictive abortion law, which is set to take effect August 25^th. The law, Idaho Code § 18-622, restricts access to abortion only when necessary to save the life of the pregnant person or in documented cases of rape or incest. There is no protection for an abortion necessary to protect the health of the pregnant patient, which the DOJ argues conflicts with the federal Emergency Medical Treatment and Active Labor Act (EMTALA). EMTALA, DOJ argues, preempts state law and protects access to abortion when it is the necessary stabilizing treatment.
 
The DOJ’s complaint is available here. In addition, a press release is available here, remarks from Attorney General Merrick Garland are available here, and remarks from Associate Attorney General Vanita Gupta are available here.
 
NCQA Announces New Equity-Focused Measures for HEDIS 2023
On August 1^st, the National Committee for Quality Assurance (NCQA) announced new and revised measures for the measurement year 2023 Healthcare Effectiveness Data and Information Set (HEDIS). Notable changes include:

• Addition of race and ethnicity stratification to eight existing measures, to assist in identifying and reducing disparities in care. The measures are childhood and adult immunizations, asthma, emergency department visits for substance use disorder, opioid prescribing and treatment, well-child visits, and breast cancer screening;
• Revisions to measures that reference pregnancy and deliveries to remove the limitation to women, to reduce the likelihood that transgender individuals are inadvertently excluded or inappropriately included in a measure; and
• Addition of five new measures to address pediatric dental care, safely and appropriately deprescribing benzodiazepines in older adults, prevention of hypoglycemia in older adults with diabetes, and social need screening and intervention.

A press release is available here; more information, including the full measure specifications, is available for purchase from NCQA here.

New York State Updates

NYS Launches Health Care and Mental Hygiene Worker Bonus Program and Submission Portal
On August 3^rd, the New York State (NYS) Department of Health (DOH), in partnership with the Governor’s Office and other State agencies, launched the Health Care and Mental Hygiene Worker Bonus (HWB) Program. The NYS Fiscal Year 2023 Enacted Budget allocated $1.2 billion of State-only funds for one-time bonuses of up to $3,000 to recruit, retain, and reward health care and mental hygiene workers that meet certain eligibility requirements.
 
Eligible employees are frontline workers with annual salaries of $125,000 or less who provide hands-on health or care services. They may include practitioners, technicians, assistants, support staff, and aides, regardless of the structure of their employment (including part-time/temporary employees and independent contractors). Disbursements will be commensurate with the number of hours worked and duration of service within designating vesting periods.
 
Eligible employers are Medicaid-enrolled providers that bill for State Plan or home and community- based services (HCBS) waiver services, or that have a provider agreement with a Medicaid managed care plan. Eligible employers may also include public or private schools, institutions of higher education, preschool programs, and other programs funded by State agencies.
 
Employers must request bonuses on behalf of qualifying employees by creating an online account in the HWB portal and submitting a claim. Employers must submit claims for bonuses within 30 days of the end of the vesting period and pay the bonus to eligible employees within 30 days of receiving the amount from the State. A qualified employer that fails to identify, claim, and/or pay any bonus for more than 10 percent of eligible employees may be subject to penalties of up to $1,000 per violation.
 
The Governor’s press release is available here. Additional information, including a link to the program portal, a list of eligible worker titles, and frequently asked questions, is available here. Questions may be submitted to nysworkersbonus@health.ny.gov.
 
Governor Hochul Extends Disaster Emergency Due to Health Care Staffing Shortages
On July 29^th, Governor Hochul issued Executive Order 4.11 (available here), which extends through August 28^th the provisions in Executive Order 4 and its successors that reinstate many workforce and scope of practice flexibilities that applied during the original New York State Covid-19 public health emergency.

Funding Opportunities

NYC DSS and HRA Release Round 3 Scattered-Site Supportive Housing RFP
On August 3^rd, the New York City Department of Social Services (DSS) and Human Resources Administration (HRA) released a Request for Proposals (RFP) for the operation and maintenance of approximately 400 units of scattered-site supportive housing for single individuals living with HIV or AIDS. This housing model provides case management and other related social service supports while providing clients with permanent, stable housing and maximizing their access to and participation in health and behavioral health treatment. This is the third round of funding for this RFP, which seeks applicants for eight service areas with existing apartments and current service contracts (see Attachment A).
 
The anticipated annual service award amount per unit is $11,270. The maximum cost per unit is based on the rental rate and the service award rate. The awarded contractor(s) will be expected to achieve a 95 percent occupancy rate within six months and maintain this occupancy rate throughout the term of the contract.
 
Applicants must have at least five years of experience providing case management and permanent supportive housing to individuals diagnosed with HIV or AIDS who have a history of mental illness or substance use disorder.
 
Additional information is available in the PASSPort system here by searching “HASA NYNYIII Scatter Site RFP.” Applications are due on September 15^th.