Weekly Health Care Policy Update – July 5, 2023

July 12, 2023

In this update:

  • Administration Updates
    • Biden Administration Launches Initiative Addressing Poverty and Cancer
  • Legislative Updates
    • Senate HELP Committee Releases Draft Pandemic Preparedness Act Reauthorization Bill; Comments Due July 10th
  • Federal Agencies
    • OIG Finalizes Rule Establishing Penalties for Information Blocking
    • FTC and DOJ Propose Changes to Premerger Notification Rules
    • GAO Seeks Nominations for HITAC
    • CMS Issues Revised Guidance for Medicare Prescription Drug Price Negotiation Program
    • CMS Releases Proposed CY 2024 Home Health Payment Rule
    • CMS Releases Proposed CY 2024 ESRD PPS Payment Rule
  • Other Updates
    • Supreme Court Declares Use of Race in College Admissions Unconstitutional
    • DOJ Announces Charges in $2 Billion Telehealth Fraud
    • Joint Commission Launches New Health Care Equity Certification Program
  • New York State Updates
    • DOH Repeals Covid-19 Vaccination Requirements for Healthcare Workers at Covered Entities
    • SED Adopts Emergency Rule for the Licensure and Certification of Behavior Analysts and Assistants
    • SED Proposes Rules Establishing Registration and Operational Requirements for Central Fill Pharmacies

Administration Updates

Biden Administration Launches Initiative Addressing Poverty and Cancer 
On June 26th, the Biden Administration launched the Persistent Poverty Initiative, an effort to “alleviate the cumulative effects of persistent poverty on cancer outcomes by building research capacity, fostering cancer prevention research, and promoting the implementation of community-based programs.” The initiative will be overseen by the National Cancer Institute at the National Institutes of Health (NIH).

The Administration also announced the award of $50 million in grants to launch five new Centers for Cancer Control Research in persistent poverty areas. These areas will be defined as those where 20% or more of the population has lived below the federal poverty line for the past 30 years. Residents of these areas have higher incidence of cancer, delays in diagnosis and treatment, poorer outcomes. The five centers will: 

  • Conduct research in areas such as obesity, nutrition, physical activity, and smoking;
  • Implement and measure the effectiveness of structural interventions for cancer control and prevention, follow-up care, and survivorship; and
  • Help build a pipeline of early-career investigators.

The centers will be located at the University of Texas MD Anderson Cancer Center, the University of Alabama at Birmingham, Stanford University, Weill Cornell Medicine and Columbia University, and the Huntsman Cancer Institute at the University of Utah.

More information is available here.

Legislative Update

Senate HELP Committee Releases Draft Pandemic Preparedness Act Reauthorization Bill; Comments Due July 10th
On July 3rd, the Senate Health, Education, Labor and Pensions (HELP) Committee released for public comment a bipartisan discussion draft of the 2023 Reauthorization of the Pandemic and All-Hazards Preparedness Act (PAHPA).
 
The discussion draft includes new programs and authorities that reflect lessons learned from the COVID-19 pandemic, such as enhancements to support EMS participation in the Hospital Preparedness Program, a pilot program to support public health data sharing between federal and state agencies, and the establishment of technical assistance centers to support individuals with disabilities during emergency responses. The draft also contains two partisan provisions that have not been agreed upon: a Democratic proposal to require all products developed with certain federal support to be sold to the U.S. government at a “most favored nation” price, and a Republican proposal to reauthorize the Food and Drug Administration’s (FDA) Priority Review Voucher program through 2028.  
 
The HELP Committee plans to mark up the bill during July. Comments are therefore due by July 10th at 10am. The draft legislative text is available here.

Federal Agencies

OIG Finalizes Rule Establishing Penalties for Information Blocking
On June 27th, the Office of the Inspector General (OIG) at the Department of Health and Human Services (HHS) published the final version of its rule establishing penalties for health care entities that engage in information blocking. This rule focuses on establishing OIG’s authority to investigate allegations of information blocking and to issue civil monetary penalties (CMPs) of up to $1 million per violation.

The regulations that define the scope of information blocking requirements and available exceptions were established by the Office of the National Coordinator for Health IT (ONC) in a March 2020 rule (summarized by SPG here). ONC is also expected to publish a rule later this year establishing its own disincentives for providers who are determined to have engaged in information blocking, as noted in the Biden Administration’s Spring 2023 Unified Agenda here.

The final OIG rule is largely unchanged from the proposed version that OIG issued in April 2020. OIG will investigate alleged cases of information blocking referred by ONC. In nonbinding guidance, it notes that it will prioritize on cases that: 

  • Result in or have the potential to cause patient harm;
  • Significantly impact a provider’s ability to care for patients;
  • Are of long duration;
  • Cause financial loss to federal health programs or other entities; and
  • Are performed with actual knowledge.

OIG will determine the amount of a CMP based on factors including the nature and extent of the information blocking and the harm resulting from the blocking. Factors that may affect the “nature and extent” include: 

  • The number of patients affected;
  • The number of providers affected; and
  • The number of days the violation persisted.

OIG’s intent is to adhere closely to the statutory language for its initial implementation of CMPs, but “may consider implementing additional, specific factors in the future via notice and comment rulemaking as we gain more experience in enforcing the CMP.”

The full text of the final rule is here. OIG has established an effective date of September 1stfor enforcement to begin.

FTC and DOJ Propose Changes to Premerger Notification Rules
On June 27th, the Federal Trade Commission (FTC), with the concurrence of the Antitrust Division of the Department of Justice (DOJ), issued a notice of proposed rulemaking (NPRM) outlining proposed change to the premerger notification form and instructions as well as the premerger notification rules under the Hart-Scott-Rodino (HSR) Act. The HSR requires the parties to certain mergers and acquisitions to notify the FTC and DOJ of their intent to merge by completing the premerger notification form and then waiting a specified amount of time before closing the proposed transaction.

FTC is proposing changes aimed at enabling the FTC and DOJ to perform more effective screening for potential competition issues during that waiting period, which is typically 30 days. During the waiting period, the Agencies may identify proposed transactions that require more in-depth investigation. These proposed changes include requiring merging parties to: 

  • Provide additional information about the transaction rationale, investment vehicles, and/or corporate relationships;
  • Provide information regarding products or services in both horizontal and non-horizontal (i.e. supply agreements) business relationships;
  • Provide projected revenue streams, transactional analyses, and market condition analyses;
  • Provide details regarding previous acquisitions; and
  • Disclose information that will allow the Agencies to screen for labor market issues by classifying employees using current Standard Occupational Classification system categories.

Comments on the proposed rule are due August 28th. The proposed rule may be found here, a press release is available here, and an FAQ document may be found here.

GAO Seeks Nominations for HITAC 
On June 20th, the Government Accountability Office (GAO) requested nominations for appointments to the Health Information Technology Advisory Committee (HITAC) for terms beginning January 1, 2024. HITAC, which was established through the 21st Century Cures Act, provides recommendations to ONC on “policies, standards, implementation specifications, and certification criteria relating to the implementation of the health information technology infrastructure that advances the electronic access, exchange, and use of health information.”

Members serve three-year terms, for a maximum of two terms serving on the committee. GAO expects to appoint two to three new members and are looking specifically for members focused on patients or consumers, health plans or purchasers, and researchers.

Letters of nomination and resumes are due by July 31st and may be submitted to HITCommittee@gao.gov. The notice in the Federal Register is available here.

CMS Issues Revised Guidance for Medicare Prescription Drug Price Negotiation Program
On June 30th, the Centers for Medicare & Medicaid Services (CMS) released revised guidance for the first round of negotiations in the new Medicare Drug Price Negotiation Program, which will occur this year and next and establish prices effective in 2026. CMS indicates the revised guidance is intended to improve transparency and create an environment for effective negotiations with pharmaceutical manufacturers. Changes from the initial guidance, which was released in March 2023, include: 

  • Clarifying how CMS will select drugs for the program;
  • Revising and clarifying the negotiation process for drug companies of selected drugs; and
  • Including additional opportunities for drug companies and the public to engage with CMS during the negotiation process.

CMS reiterated the timeline for price negotiations, including that by September 1st, it will publish the first 10 drugs selected for the program (with prices applicable in 2026) and that the maximum fair price for those drugs will be published by September 1, 2024. CMS will select up to 15 additional drugs for 2027, up to 15 additional drugs for 2028 (which may include Part B drugs), and up to 20 additional drugs in each following year.

The revised guidance is available here, a fact sheet is available here, and a press release is available here.

CMS Releases Proposed CY 2024 Home Health Payment Rule
On June 30th, CMS released the calendar year (CY) 2024 Home Health Prospective Payment System (HH PPS) proposed rule. CMS estimates that payments to home health agencies (HHAs) under the proposed rule would decrease by 2.2% ($375 million) in the aggregate, relative to CY 2023, reflecting the combined effects of a proposed 2.7% payment increase, an estimated 5.1% payment decrease (statutorily required by the proposed prospective, permanent behavior assumption adjustment), and an estimated 0.2% increase reflecting the effects of a proposed update to the fixed-dollar loss (FDL) ratio used in determining outlier payments.

Other notable provisions of the proposed rule include: 

  • A permanent, prospective adjustment for CY 2024 to account for the impact of the implementation of the Patient-Driven Groupings Model (PDGM). CMS previously finalized, for CY 2023, an adjustment that was half of the estimated required permanent adjustment;
  • Rebasing and revising the home health market basket;
  • Revising the labor-related share;
  • Recalibrating PDGM case-mix weights;
  • Updating the low utilization payment adjustment (LUPA) thresholds, functional impairment levels, and comorbidity adjustment subgroups for CY 2024;
  • Codifying statutory requirements for disposable negative pressure wound therapy (dNPWT);
  • Establishing regulations to implement payment for items and services under the lymphedema compression treatment items and home intravenous immune globulin (IVIG) benefit categories;
  • An RFI on access to home health aide services;
  • Changes to the home health quality reporting program (QRP), including adopting two new quality measures, removing two measures, and proposing public reporting of four measures; and
  • Changes to provider enrollment regulations to prevent and address hospice waste, fraud, and abuse.

Comments on the proposed rule are due August 29th. The proposed rule is available here and a fact sheet is available here.

CMS Releases Proposed CY 2024 ESRD PPS Payment Rule
On June 26th, the CMS released the Calendar Year (CY) 2024 end-stage renal disease (ESRD) PPS proposed rule. The rule also proposes a CY 2024 update to the Acute Kidney Injury (AKI) dialysis payment rate and updates to the ESRD Quality Incentive Program (QIP). Overall, CMS proposes to increase the ESRD PPS base rate to $269.99, an increase of $4.42 from the CY 2023 base rate of $265.57, resulting in an estimated $6.4 billion in Medicare spending on ESRD facilities. CMS estimates Medicare payments to freestanding ESRD facilities will increase by 1.6% and payments to hospital-based ESRD facilities will increase by 2.6%. The proposed CY 2024 AKI payment rate is also $269.99.

Other proposals in the rule include: 

  • A payment increase for certain new renal dialysis drugs and biological products following the end of the Transitional Drug Add-On Payment Adjustment (TDAPA);
  • Adjustments to the wage index and outlier policy, as required annually;
  • Adding exceptions to the LVPA attestation process for facilities affected by disasters or other emergencies;
  • Requiring reporting of “time on machine” data and of discarded and unused amounts of dialysis drugs and biological products from single-dose or single-use packages or containers;
  • A transitional add-on payment adjustment for pediatric ESRD services for CYs 2024-2026;
  • Clarifications regarding evaluation of the Transitional Add-On Payment Adjustment for New and Innovative Equipment and Supplies (TPNIES) eligibility criteria. CMS requests comments on whether a new product designed to block pain associated with dialysis cannulation meets TPNIES eligibility criteria; and
  • Changes to the ESRD QIP for payment years 2026 and 2027, including: 
    • Adding three new social needs-related reporting measures (Facility Commitment to Health Equity, the Screening for Social Drivers of Health, and the Screen Positive Rate for Social Drivers of Health);
    • Updating the Covid-19 Vaccination Coverage Rate Among Healthcare Personnel (HCP) reporting measure to align with CDC updates; and
    • Other proposed changes.

The rule also includes two Requests for Information (RFIs) to inform potential future rulemaking, on: 

  • Updates to the Low-Volume Payment Adjustment (LVPA) methodology; and
  • Potential creation of a new payment adjustment for geographically isolated ESRD facilities.

Comments on the proposed rule are due August 25th. The proposed rule is available here and a fact sheet is available here.

Other Updates

Supreme Court Declares Use of Race in College Admissions Unconstitutional
On June 29th, in a 6-3 decision, the Supreme Court declared the use of race as a factor in college and university admissions’ decisions unconstitutional, citing the Fourteenth Amendment’s prohibition on discrimination based on race. The decision addressed cases involving Harvard and the University of North Carolina, both of which use race as a factor in admissions decisions to diversify their student body. While colleges may evaluate students on materials that may mention race (such as their application essays), colleges are no longer permitted to use race alone as a factor in admissions decisions. The Court indicated that they should instead consider whether the mention of race demonstrates the applicant’s personal accomplishments or virtues.

Health care leaders expressed concerns about the ruling’s impact on the diversity of the health care workforce, with Health and Human Service Secretary Xavier Becerra saying, “This ruling will make it even more difficult for the nation’s colleges and universities to help create future health experts and workers that reflect the diversity of our great nation. The health and wellbeing of Americans will suffer as a result.” The decision was met with disapproval by several health care organizations including the American Association of Medical Colleges, the American Medical Association, and the American Cancer Society.

The Supreme Court’s decision is available here. A statement from HHS Secretary Becerra is available here.

DOJ Announces Charges in $2 Billion Telehealth Fraud
On June 28th, the Department of Justice (DOJ) announced that a national law enforcement action, conducted with federal and state law enforcement partners, resulted in criminal charges against 78 defendants for their alleged participation in health care fraud and opioid abuse schemes totaling more than $2.5 billion in alleged fraud. This includes one of the largest health care fraud schemes ever prosecuted, totaling more than $2 billion in fraudulent claims resulting from telemedicine schemes. Charges were also filed in connection with fraudulent prescription drug claims, illegal distribution of opioids, and clinical laboratory testing fraud.

A press release with more information about the most recent charges is available here and descriptions of the cases involved in this enforcement action is available here.

Joint Commission Launches New Health Care Equity Certification Program 
On June 27th, the Joint Commission launched a new Health Care Equity Certification Program. The voluntary program, effective July 1st, recognizes hospitals (including critical access hospitals) that “strive for excellence in their efforts to provide equitable care, treatment, and services.” The new certification will focus on: 

  • Decreasing health care disparities in patient populations;
  • Promoting diversity, equity and inclusion for staff; and
  • Addressing organizational performance in five key domains: 
    • Leadership;
    • Collaboration;
    • Data collection;
    • Provision of care; and
    • Performance improvement.

The Joint Commission has also developed a Health Care Equity Certification Resource Center to help organizations meet the certifications requirements and elements of performance.

The full announcement is available here.

New York State Updates

DOH Repeals Covid-19 Vaccination Requirements for Healthcare Workers at Covered Entities
On June 28th, the New York State Department of Health (DOH) issued a proposed rule to repeal the Covid-19 vaccine mandate for health care personnel at covered entities across New York, including: 

  • Article 28 hospitals, nursing homes, and diagnostic and treatment centers;
  • Article 36 (Public Health Law) home care providers;
  • Article 40 (Public Health Law) hospices; and
  • Article 7 (Social Services Law) adult care facilities.

Although the repeal requires final approval by the Public Health and Health Planning Council (PHHPC), DOH has already ceased enforcement.

The proposed rule is available in the State Register here. It aligns with the Dear Administrator letter issued by DOH on May 24th (available here). Comments may be submitted to Katherine Ceroalo at regsqna@health.ny.gov through August 27th.

SED Adopts Emergency Rule for the Licensure and Certification of Behavior Analysts and Assistants
On June 28th, pursuant to legislation passed in 2022 and 2021 (available here and here), the New York State Education Department (SED) posted an emergency rule in the State Register (available here) that amends State licensure and certification requirements for behavioral analysts to align more closely with national standards. Specifically, the emergency rule implements the following provisions for licensed behavioral analysts (LBAs) and certified behavioral analyst assistants (CBAAs): 

  • Revises education requirements;
  • Revises experience requirements and adds additional qualifications for supervisors;
  • Increases flexibility in licensing examination requirements;
  • Allows individuals who graduate from qualifying education programs and who work under an LBA’s supervision to meet experience requirements for national certification and entry for the licensing examination;
  • Updates provisions related to unprofessional conduct; and
  • Expands the scope of practice for LBAs by authorizing them to provide applied behavioral analysis (ABA) services to individuals diagnosed with behavioral health conditions beyond autism spectrum related disorders.

The detailed substance of the emergency rule is available here. The emergency rule will expire September 10th. SED intends to adopt the provisions of the emergency rule as a permanent rule.

SED Proposes Rules Establishing Registration and Operational Requirements for Central Fill Pharmacies
On June 28th, SED issued rules to establish requirements for the registration and operation of central fill pharmacies. The rules delineate the respective roles and responsibilities of originating pharmacies and central fill pharmacies and provides for a 12-month phase-in period for such pharmacies to come into compliance with regulations. 

The rules also require non-resident pharmacies that provide central fill activities on behalf of registered pharmacies in New York State to meet the same operational requirements as central fill pharmacies located in the State.

The texts of the proposed rules are available in the State Register here. Comments may be submitted to Sarah Benson at regcomments@nysed.gov by August 27th.