Weekly Health Care Policy Update – June 21, 2023

June 28, 2023

In this update:

  • Federal Agencies
    • HHS ACL Publishes Proposed Rule Updating Older Americans Act Regulations
    • OMB Releases Biden Administration’s Spring 2023 Regulatory Agenda
    • CMS Releases National Health Expenditure Projections
    • CMS Announces July Publication of Interim Performance Reports for HHVBP
  • Other Updates
    • U.S. Chamber of Commerce Files Lawsuit Challenging Medicare Drug Price Negotiation Program
    • ACA Preventive Care Requirement to Remain During Legal Challenge
    • MACPAC Issues June 2023 Report to Congress
    • MedPAC Issues June 2023 Report to Congress
    • AMA Votes to Deemphasize BMI in Assessing Health and Obesity
  • New York State Updates
    • CMS Approves Extension of Medicaid Postpartum Coverage in NY
    • OASAS Proposes Voluntary Certification Process for Recovery Residences
  • Funding Opportunities
    • OMH Releases RFP for Intensive and Sustained Engagement Teams
    • HRSA Releases NOFO for Behavioral Health Workforce Education and Training Program
    • HRSA Releases NOFO for Maternity Care Nursing Workforce Expansion Program

Federal Agencies

HHS ACL Publishes Proposed Rule Updating Older Americans Act Regulations
On June 15th, the Administration for Community Living (ACL) at the Department of Health and Human Services (HHS) published a proposed rule to update regulations for Older Americans Act (OAA) programs, the first such update in 35 years. The Older Americans Act was first passed in 1965 and last reauthorized in March 2020. It authorizes a variety of programs servicing older Americans, including home-delivered and congregate meals, support for family caregivers, preventive health services, personal and home care services, transportation, legal assistance, elder abuse prevention, and more. In New York, the OAA governs the operations of the State Office for the Aging (SOFA).

The proposed rule clarifies requirements across programs and establishes regulations for programs authorized by the OAA since the rule was last updated. It intends to reflect changes to how older adults are cared for today, including lessons learned from the pandemic. Specific updates include clarifying who is eligible for services and setting expectations for legal assistance to help curb elder abuse.

The proposed rule is available here. A webinar on the rule will be held on June 22nd at 12:30pm ET, and comments are due by August 15th.

OMB Releases Biden Administration’s Spring 2023 Regulatory Agenda
On June 14th, the Office of Management and Budget (OMB) published the Biden Administration’s Fall 2022 Unified Agenda for regulation. Typically released twice a year, the Unified Agenda outlines regulatory priorities for the Administration. In this edition, most of the listed planned regulations have been included in the past. In addition to the annual payment policies required by statute, topics of note include: 

  • Skilled Nursing Facility (SNF) minimum staffing requirements;
  • 340B-acquired drugs (in response to the legal challenges in American Hospital Association v. Becerra);
  • Health Information Technology (HIT) provisions, via the Office of Civil Rights (OCR), as well as HIT-related interoperability and information blocking rules via the Office of the National Coordinator (ONC);
  • Medicare disproportionate share hospital (DSH) payments; and
  • A new mandatory alternative payment model under Medicare.

The Unified Agenda may be found here.

CMS Releases National Health Expenditure Projections 
On June 14th, the Centers for Medicare & Medicaid Services (CMS) Office of the Actuary released National Health Expenditure (NHE) and health insurance enrollment projections for 2022-2031. CMS projects an average annual growth in NHE of 5.4% over ten years, outpacing the projected annual increase in gross domestic product (GDP) of 4.6%. As a result, by 2031 health spending will consume 19.6% of GDP, up from 18.3% in 2021. Regarding health insurance enrollment, CMS projects that in 2031, 90.5% of the population will be insured, a similar rate to pre-pandemic levels but a drop from the projected, historic high of 92.3% in 2022.

The release also includes several payer- and provider-specific projections for 2022-2031, including: 

  • Decreases in the growth rate of total out-of-pocket spending for prescription drugs under Medicare Part D of 5.9% in 2024, 4.2% in 2025, and 0.2% in 2026, due to the Inflation Reduction Act;
  • Projected average annual expenditure growth of 7.5% for Medicare;
  • Projected average annual expenditure growth of 5% for Medicaid, mostly occurring in 2025-2031;
  • Projected average annual expenditure growth of 5.4% for private health insurance;
  • For hospital spending, projected average annual spending growth of 5.8%;
  • For physician and clinical services, projected average annual spending growth of 5.4%; and
  • For retail prescription drugs, projected average annual spending growth of 4.6%.

The published projections are available here, and a press release is available here. A research article written by CMS actuaries is also available from Health Affairshere.

CMS Announces July Publication of Interim Performance Reports for HHVBP
On June 16th, the Centers for Medicare and Medicaid Services (CMS) announced that it will publish interim performance reports (IPRs) for the Expanded Home Health Value-Based Purchasing Model (HHVBP) in July. The IPRs will offer home health agencies (HHAs) feedback about performance relative to quality measure achievement thresholds, benchmarks, and improvement thresholds, and will be based on the 12 most recent months of data available (ending in March 2023). For providers with more than one CMS Certification Number (CCN), a report will be available for CCN.

The IPR will include: 

  • The HHA’s interim measure performance scores;
  • An interim total performance score;
  • Improvement, achievement, and care points reflecting performance relative to an HHA’s cohort;
  • A total normalized composite change reference tab to show performance on individual OASIS items; and
  • Measure scorecard information to explain how individual measures contribute to the interim total performance score.

IPRs will be published in “preliminary” and “final” forms and HHAs may submit recalculation requests if they believe there are discrepancies. More information is available on the HHVBP website here.

Other Updates

U.S. Chamber of Commerce Files Lawsuit Challenging Medicare Drug Price Negotiation Program
On June 9th, the U.S. Chamber of Commerce, in partnership with the Dayton Area Chamber of Commerce, the Ohio Chamber of Commerce, and the Michigan Chamber of Commerce, sued the federal government over its Medicare drug price negotiation program, as established in the Inflation Reduction Act of 2022. The lawsuit, filed in the Southern District of Ohio Western Division, alleges that the program establishes “an artificial and arbitrary system for devising price caps that will jeopardize medical breakthroughs for individuals with life-threatening and chronic illnesses.”

The plaintiffs argue that the term “negotiation” implies a “voluntary and fair bargaining process will take place between the government and pharmaceutical companies,” when in fact, the process will be a “one-sided regime that forces manufacturers to sell drugs at government-set prices.” The suit alleges that the program is unconstitutional, violating the following provisions: separation-of-powers, due process, excessive fines clause, enumerated powers, and the first amendment. The suit follows a similar complaint by Merck, filed on June 6th.

The complaint is available here.

ACA Preventive Care Requirement to Remain During Legal Challenge
On June 13th, the Fifth Circuit Court of Appeals maintained the stay of a lower court decision in Braidwood Management v. Becerra for the duration of the appeals process. The Braidwood decision struck down the Affordable Care Act (ACA) requirement that health plans cover preventive care items and services with an A or B rating from the U.S. Preventive Services Task Force (USPSTF) and Pre-Exposure Prophylaxis (PrEP) for HIV without cost-sharing. Following last week’s oral arguments, the appeals court panel ordered attorneys representing both sides of the case to report on the possibility of a compromise regarding whether the coverage requirements should remain in place during the appeals process. On June 13th, the Court approved the compromise, in which the plaintiffs would permit a partial stay of the initial ruling (which eliminated the coverage requirements) in exchange for the federal government’s assurance that it will not seek penalties against the named plaintiffs for actions taken based on that initial ruling, even if such ruling is later vacated or reversed on appeal. This means that the requirement to cover preventive items and services without cost-sharing is maintained (for all entities except the named plaintiffs) while the case is appealed.

In a separate filing, the Fifth Circuit presented a briefing schedule for the appeal of the underlying ruling. Final briefs are due November 3rd, with oral arguments presumably to follow, though not yet scheduled.

The compromise reached by the two parties is available here and the order enforcing the compromise is available here. The briefing schedule may be found here.

MACPAC Issues June 2023 Report to Congress
On June 15th, the Medicare and CHIP Payment and Access Commission (MACPAC) released its June 2023 Report to the Congress. The report contains four chapters and the Commission includes recommendations to Congress on just one topic: 

  • Automatic DSH Adjustments: The Commission notes that DSH are capped based on federal allotments and when federal medical assistance percentages (FMAP) increase, DSH allotments decrease. The Commission recommends several changes to ensure that DSH funding is not impacted by FMAP changes.
  • Access to HCBS: The Commission reviewed recent research on access to home and community-based service (HCBS) and indicated its intent to explore HCBS spending and use, payment rates, and administrative requirements for programs in the coming year.
  • Integrating Care for Duals: The Commission elaborates on its previous recommendations regarding integrating care for individuals eligible for both Medicare and Medicaid, including that states develop strategies through the Financial Alignment Initiative demonstration. MACPAC intends to focus future work on options to integrate care across traditional Medicare delivery mechanisms and managed care, particularly in the wake of a CMS rule sunsetting Medicare-Medicaid Plans (MMPs), which the Commission believes will shift more dual eligibles into Medicare Advantage (MA) Dual-Eligible Special Needs Plans (D-SNPs).
  • Coverage for Adults Leaving Incarceration: The Commission notes that disproportionate incarceration rates amongst many different marginalized populations present equity issues for coverage of individuals leaving incarceration. MACPAC plans to monitor Section 1114 demonstrations that allow states to provide coverage for individuals leaving incarceration.

The June 2023 report is available here and a press release is available here.

MedPAC Issues June 2023 Report to Congress
On June 15th, the Medicare Payment Advisory Commission (MedPAC) released its June 2023 report to Congress. The report covers ten topics including prices of Part B drugs, post-sale rebates for Part D prescription drugs, standardized MA plan benefits, future MA payment policies, outcome disparities for beneficiaries with different social risks, Medicare behavioral health services, telehealth, ambulatory fee-for-service (FFS) rates, wage index, and a post-acute care (PAC) prospective payment system (PPS).

Within these categories, commissioners offered formal recommendations in four areas: 

  • Part B Drugs: Commissioners recommended that: 
    • Congress should require the HHS to cap the Medicare payment rate for Part B drugs and biologics approved under the accelerated approval program provided under certain circumstances;
    • Congress should give HHS the authority to establish a single average sales price–based payment rate for drugs and biologics with similar health effects;
    • Congress should require HHS to reduce add-on payments for costly Part B drugs and biologics paid based on average sales price; and
    • Congress should require HHS to eliminate add-on payments for Part B drugs and biologics paid based on wholesale acquisition cost.
  • Ambulatory FFS Rates: Commissioners recommended that Congress more closely align payment rates across ambulatory settings for services that are safe and appropriate to provide in all settings.
  • Wage Index: Commissioners recommended that Congress repeal existing Medicare wage index statutes, and that Congress require the Secretary to phase in new Medicare wage index systems that use all-employer, occupation-level wage data with different occupation weights for the wage index of each provider type, reflect local area level differences in wages between and within metropolitan statistical areas and statewide rural areas, and smooth wage index differences across adjacent local areas.
  • PAC PPS: Commissioners provided Congress with a report on a unified post-acute care payment system mandated by the Improving Medicare Post-Acute Care Transformation Act of 2014.

The full report is available here.

AMA Votes to Deemphasize BMI in Assessing Health and Obesity 
On June 13th, the American Medical Association (AMA) voted to adopt a policy to deemphasize the use of the body mass index (BMI) in assessing health and obesity at its annual meeting. BMI is calculated by dividing weight by the square of height (in metric units). In adopting the policy, the AMA acknowledged that the BMI tool has caused “historical harm” by basing its structure on data collected from white populations. BMI also does not consider a person’s gender or ethnicity, nor does it differentiate between fat and lean mass and does not account for body fat location. The AMA encourages physicians to use other measures such as body composition, waist circumference, and genetic factors, in conjunction with BMI. The AMA also adopted a policy to use other measures such as adiposity, body composition, and waist circumference in all patients, rather than simply BMI, when monitoring for obesity.

New York State Updates

CMS Approves Extension of Medicaid Postpartum Coverage in NY 
On June 13th, CMS announced the extension of New York’s comprehensive Medicaid and Children’s Health Insurance Program coverage after pregnancy for postpartum individuals for a full 12 months. Prior to this option, Medicaid required postpartum coverage for 60 days only. The extended coverage option was originally passed in the American Rescue Plan and made permanent in the Consolidated Appropriations Act of 2023. New York’s extension will make an additional 26,000 New Yorkers eligible for Medicaid for a full year after pregnancy. New York is now the 35th state to be approved for the extended coverage.

More information is available here.

OASAS Proposes Voluntary Certification Process for Recovery Residences 
On June 14th, the New York State Office of Addiction Services and Supports (OASAS) posted a proposed rule in the State Register (available here) outlining a voluntary certification process for Recovery Residences, which are also known as recovery homes or sober homes. The voluntary process aims to standardize safe and quality housing that supports individuals on the continuum of recovery, provide a pathway for providers to legitimize recovery support services, and allow OASAS to develop a framework to collect data on resident outcomes. Recovery residences that do not wish to go through the voluntary certification process will be able to continue operating.
The proposed rule outlines requirements that must be met by recovery residences to be approved for certification, including: 

  • Staffing and training requirements;
  • Support for residents who return to substance use;
  • Safety and housing standards;
  • Resident rights and obligations; and
  • Requirements for providers to attempt to help residents find other accommodations if facing eviction.

The detailed substance of the proposed rule is available here. Comments may be submitted to Kelly E. Grace at Kelly.Grace@oasas.ny.gov by August 13th.

Funding Opportunities

OMH Releases RFP for Intensive and Sustained Engagement Teams
On June 16th, the New York State Office of Mental Health (OMH) announced a Request for Proposals (RFP) seeking experienced organizations to implement Intensive and Sustained Engagement Teams (INSET) programs in four locations throughout New York State. INSET uses a peer-led, voluntary approach to engage high-risk individuals with complex needs who cycle in and out of emergency department, inpatient, and/or forensic settings, including individuals currently receiving AOT services or who are AOT eligible.
Award recipients must employ a multi-disciplinary team comprised of the following positions: 

  • Peer team leader;
  • Peer support staff;
  • Family liaison; and
  • Licensed professionals, including a social worker and a nurse practitioner and administrative staff.

INSET teams are expected to contact approximately 20-30 individuals a month through intensive, personalized outreach, which must include face-to-face, telephonic, and audio-visual modalities. INSET teams must also establish an on-call system to provide 24/7 response and support. 

Eligible applicants are 501(c)(3) not-for-profit agencies located in New York State, that have at least 51% of their governing body and a preponderance of their staff comprised of people with lived experience of mental health issues and experience with the public mental health system.

OMH will make awards to four programs, providing $800,000 annually per program, over a project period of five years. OMH anticipates INSET programs being administered in Western New York, Hudson River, Long Island, and in NYC regions; however, OMH will entertain proposals from any regions of New York State. Applicants wishing to apply for more than one region, county, or neighborhood should submit separate applications for each geographic area.

The RFP is available here. Application proposals are due by August 15th at 2pm. Questions may be submitted by July 11th to Carol Swiderski at OMHLocalProcurement@omh.ny.govwith the subject line “INSET RFP Inquiry”; answers will be posted on July 27th.

HRSA Releases NOFO for Behavioral Health Workforce Education and Training Program 
On June 12th, the Health Resources and Services Administration (HRSA) released a notice of funding opportunity (NOFO) for the fiscal year (FY) 2023 Behavioral Health Workforce Education and Training – Children, Adolescents, and Young Adult (BHWET-CAY) Program for Professionals, which aims to increase the supply of behavioral health providers who deliver developmentally appropriate care to individuals under the age of 26 residing in underserved and rural communities. BHWET-CAY will fund accredited degree or training programs that: 

  • Provide stipend support to behavioral health provider trainees in their final year of experiential training (internship or field placement) prior to graduation;
  • Develop or expand experiential training sites (including those in community-based settings) that prioritize cultural and linguistic competencies;
  • Recruit current students and clinical supervisors from diverse backgrounds;
  • Provide psychoeducation training to faculty, clinical supervisors, and trainees to reduce barriers to behavioral health care for CAY populations;
  • Recruit, develop, and compensate clinical supervisors who support BHWET-CAY trainees; and
  • Provide resources to connect graduating trainees with employment opportunities in underserved or rural communities.

Eligible applicants are institutions of higher education or professional training programs in mental health; doctoral, internship, and post-doctoral residency programs; master’s and doctoral degree programs of social work; and community-based organizations. Applicants must be accredited by a nationally recognized accrediting body. 

HRSA expects to award up to 18 recipients, at up to $530,000 annually per recipient, for a project period of 2 years. At least 50% of an applicant’s annual budget request must be dedicated to stipends for trainees; all other costs, including indirect costs, must be budgeted out of the remaining 50 percent. Stipends are capped as follows (anything above the cap must be paid for by the grantee): 

  • $15,000 per master’s-level students (including Advanced Standing);
  • $25,000 per doctoral-level students;
  • $28,352 per doctoral-level interns; and
  • $48,804 per post-doctoral residents/fellows.

The NOFO is available here. Applications must be submitted electronically to grants.gov by July 14th. Interested applicants may attend an optional technical assistance webinar here on June 20th at 3pm. Questions can be submitted to India Johns at BHWET-CAY@hrsa.gov.

HRSA Releases NOFO for Maternity Care Nursing Workforce Expansion Program 
On June 12th, HRSA issued a NOFO for the FY 2023 Maternity Care Nursing Workforce Expansion (MatCare) Program, which provides support to accredited nurse midwifery programs to train certified nurse midwives (CNMs) through trainee scholarships, stipends, curriculum enhancement and community-based training to grow the maternal and perinatal health nursing workforce in urban underserved and rural communities. Award recipients will be expected to: 

  • Recruit, train, and support student nurse midwife trainees from diverse backgrounds, including those from underrepresented populations;
  • Provide financial traineeship support (such as tuition scholarships and/or stipends) to student nurse midwives committed to working with underserved and/or rural populations;
  • Expand accredited certified nurse midwifery training programs to increase the number of trainees;
  • Implement or enhance didactic and clinical curriculum that addresses maternal mental health, social determinants of health, and health equity;
  • Establish or enhance partnerships that facilitate clinical training experiences in community-based settings; and
  • Develop or expand partnerships with other academic institutions or community-based organizations to recruit a diverse group of trainees and faculty/preceptors.

Eligible applicants are accredited nursing schools, nursing centers, academic health centers, state and local governments, and certain nonprofit entities such as FQHCs and rural health clinics. Trainees benefiting from MatCare support must be licensed registered nurses (RNs) who are enrolled full-time in an advanced nursing education program to become certified as a CNM.

HRSA expects to make eight awards of up to $1 million annually per award, for a project period of four years. Preference will be given to applicants with projects that demonstrate a high placement rate of CNM graduates in practice settings located in medically underserved areas, rural areas, and/or State/local health departments that serve communities in need.

The NOFO is available here. Applications must be submitted electronically to grants.gov by July 14th. Interested applicants may attend an optional technical assistance webinar here on June 22nd at 1pm. Questions can be submitted to Courtney McRae at cmcrae@hrsa.gov or to Tolu Apaloo at  TApaloo@hrsa.gov.