Weekly Health Care Policy Update – October 8, 2021

October 15, 2021

In this update: 

  • COVID-19 Response
    • Pfizer Asks FDA for EUA for Covid-19 Vaccine for Kids 5-11
    • White House Announces Investment in Covid-19 Rapid Tests, FDA Grants EUA for FlowFlex
    • OMB Publishes Guidance on Federal Vaccine Mandate Exemptions
    • AstraZeneca Applies for EUA for Long-Acting Antibody Treatment
    • J&J Requests FDA Authorization for Booster Shots
  • Administration
    • NIH Director Francis Collins Announces Retirement
  • Legislative
    • Reps. Neal and Brady Express Concerns about Surprise Billing Rule
  • Regulatory
    • CMS Releases 2022 MA and Part D Star Ratings
    • FDA Finalizes Rule on De Novo Approval Guidelines
    • CMS Issues FAQs on Premium Discounts for Covid-19 Vaccination
    • CMS Releases Data on Utilization of Z-Codes for Social Determinants of Health
    • SAMHSA Awards $74.2 Million to Strengthen Youth Mental Health
  • Other
    • GAO Issues Report on Provider Experiences with MIPS
    • Premier Releases Data on Hospitals’ Pandemic Labor Costs
  • Congressional Hearings
  • New York State
    • DOH to Hold Webinar on SHCFTP Capital Funding Round 3
    • Governor Hochul Expands Covid-19 Vaccine Mandate to Staff in OMH and OPWDD Hospitals
    • NYS Receives CMS Approval for Transition of Some Behavioral Health HCBS to CORE Services
    • DFS and DOH Release Health Care Administrative Simplification Workgroup Report
    • DFS Issues Circular Letter to Insurers Regarding Suspension of Certain Utilization Review Requirements and Appeal Timeframes
    • DOH Proposes to Increase Rates for ACT Services
    • HERO Act Designation Extended Through October 31st
    • DOH to Require Cultural Competency Training for Managed Care Providers

COVID-19 Response

Pfizer Asks FDA for EUA for Covid-19 Vaccine for Kids 5-11
On October 7th, Pfizer and BioNTech announced that they have asked the Food and Drug Administration (FDA) to authorize emergency use of their Covid-19 vaccine for children ages 5 to 11. The FDA has tentatively scheduled a meeting for October 26th to consider the request, with a decision expected before Thanksgiving. The companies are proposing to give children a dose one-third the size of the adult amount, which will require a change in administration compared to the 12+ vaccine, as well as new labeling. About 30,000 children were hospitalized with Covid-19 in August, and roughly 500 have died. The FDA granted an EUA for use of the vaccine in children ages 12 to 15 in May.
 
White House Announces Investment in Covid-19 Rapid Tests, FDA Grants EUA for FlowFlex
On October 6th, the White House announced that it will purchase $1 billion worth of rapid, at-home Covid-19 tests, stating that this will quadruple the current supply of at-home tests to 200 million per month by December. The White House will also expand its free testing program to 20,000 pharmacies, doubling the President’s earlier commitment. The announcement follows an October 4th decision by the FDA to issue an emergency use authorization for the ACON Laboratories FlowFlex Covid-19 home test. FlowFlex is an over-the-counter Covid-19 antigen test available to consumers without a prescription. The authorization is expected to double at-home rapid testing capacity in the U.S. over the next several weeks. ACON Laboratories is expected to produce more than 100 million tests per month, increasing to 200 million per month by February 2022.
 
A press briefing by the Covid-19 Response Team discussing this program is available here.
 
OMB Publishes Guidance on Federal Vaccine Mandate Exemptions
On October 4th, the White House Office of Management and Budget (OMB) published new guidance outlining specific medical conditions that would warrant an exemption to the vaccine mandate for federal workers. Under the mandate, federal employees need to be fully vaccinated by November 22nd. Employees will be considered fully vaccinated for Covid-19 two weeks after they have received the requisite number of doses of their vaccine. Prior Covid-19 infection (or antibody tests) may not substitute for vaccination.
 
The guidance outlines very limited exceptions to the vaccination mandate, which include a disability or a sincere religious belief. In the case of a religious belief, the guidance specifies that “personal preference, concerns about the possible effects of the vaccine, or political opinions” do not qualify an individual for an exception. In the case of a disability, some medical conditions may permit a delay in vaccination until two weeks after the clinical condition resolves. However, the only conditions that will be accepted for permanent exceptions are: 

  • Severe allergic reaction after a previous dose (or to a component of the vaccine); or
  • An immediate allergic reaction of any severity to a previous dose (or known allergy to a component of the vaccine).

Employees who delay or are exempt from vaccination will need to follow applicable masking, physical distancing, and testing protocols, as well as applicable travel guidance.
 
The full guidance, including templates of forms for employees seeking exemptions, can be found here.
 
AstraZeneca Applies for EUA for Long-Acting Antibody Treatment
On October 5th, AstraZeneca announced that it had applied to the FDA for emergency use authorization for AZD7442, its long-acting antibody treatment to prevent Covid-19 in people at high risk for the disease. In its statement, AstraZeneca reported that the prophylaxis treatment reduced the risk of symptomatic Covid-19 by 77% amongst trial participants with co-morbidities associated with greater risk of severe disease, and those without sufficient antibodies post-vaccination. The treatment, a combination of tixagevimab and cilgavimab, is derived from B-cells donated by convalescent patients post-Covid infection. It was discovered by Vanderbilt University Medical Center and could offer up to 12 months of protection from Covid-19 following a single administration.
 
The statement can be found here.
 
J&J Requests FDA Authorization forBooster Shots
On October 5th, Johnson & Johnson (J&J) asked the FDA to authorize a booster dose of its Covid-19 vaccine for people 18 and older. J&J said that a second dose increased protection against symptomatic moderate to severe Covid-19 to 94%, with 100% protection against severe illness. The company did not say, however, how long after initial vaccination the second dose should be given. The FDA’s independent vaccine advisory committee will meet on October 15th to consider the booster shot. Roughly 15 million people received an initial J&J vaccine, which provided 66% protection against moderate and severe illness. On September 22nd, the FDA authorized the Pfizer/BioNTech booster shot for the elderly, and for younger adults with jobs or underlying health conditions that increase their risk of severe infection.

Administration Updates

NIH Director Francis Collins Announces Retirement
On October 5th, Francis Collins, the director of the National Institutes of Health (NIH), announced his retirement from the agency. Collins, an MD/PhD physician-geneticist, has worked at the NIH since 1993. During his tenure, he directed the National Human Genome Research Institute and an international project to map the human genome, earning him the Presidential Medal of Freedom in 2007. He was nominated to serve as director by President Obama in 2009, making him the longest-serving NIH director in the Agency’s history. As director, Collins oversaw a one-third increase in the agency’s budget. He is the only presidentially appointed NIH director to serve in more than one administration. Collins will serve until the end of the year, after which time he will continue to lead his research laboratory at NIH.

Legislative Updates

Reps. Neal and Brady Express Concerns about Surprise Billing Rule
On October 4th, House Ways and Means Chairman Richard Neal (D-MA) and Ranking Member Kevin Brady (R-TX) sent a letter to Biden Administration officials expressing concerns that the agencies’ implementation of the No Surprises Act does not reflect the law passed by Congress. The letter expresses specific concerns about the interim final rule published on September 30th, as well as the decision to delay full implementation of the Advanced Explanation of Benefits and other patient protections.
 
According to the letter, the interim final rule does not uphold the balance that Congress struck in designing the independent dispute resolution (IDR) process. Instead, the agencies crafted a process that “essentially tips the scales for the median contracted rate being the default appropriate payment amount.” This standard “biases the IDR entity toward one factor (a median rate) as opposed to evaluating all factors equally as Congress intended.” The letter also expresses concern about the administration’s decision to delay the implementation of certain transparency provisions that were supposed to take effect on January 1, 2022. The letter asks that the agencies “revisit this interim final rule and consider adjustments that better align with the law Congress enacted.”

Regulatory Updates

CMS Releases 2022 MA and Part D Star Ratings
On October 8th, the Centers for Medicare and Medicaid Services (CMS) announced the release of the 2022 Star Ratings for Medicare Advantage (MA) and Part D managed care plans. In 2022, approximately 68 percent of MA plans that offer prescription drug coverage will have an overall score of four stars or above, compared to 49 percent in 2021. CMS stated that the increase resulted both from underlying score improvements and from Covid-19-related adjustments.  Over 90 percent of enrollees in such plans are in a plan earning four stars or above.
 
The 2022 Star Ratings may be found here.
 
FDA Finalizes Rule on De Novo Approval Guidelines
On October 4th, the FDA released a final rule to update and clarify the medical device de novo classification process. The de novo classification process provides a pathway for certain new medical devices to obtain marketing authorization as class I or class II devices, rather than automatically being designated a class III device, which requires premarket approval by the FDA. This final rule completes a rulemaking effort announced by the FDA in November 2018 to provide an efficient pathway to approval for new medical devices for which a substantial equivalent, or predicate, is not currently approved or marketed.

The final rule is substantively similar to the 2018 proposed rule with a few exceptions. Notably, with regard to confidentiality, the final rule provides that after a de novoclassification is issued, data and information that are not exempt from release under the Freedom of Information Act (FOIA) will be available for public disclosure, and that safety and effectiveness information will be disclosed immediately, rather than after a request is made. 

The rule is available here and is effective January 3, 2022.
 
CMS Issues FAQs on Premium Discounts for Covid-19 Vaccination
On October 4th, CMS issued subregulatory guidance in the form of frequently asked questions (FAQs) on group health plans offering differential pricing based on Covid-19 vaccination status. Although such plans may not condition benefit eligibility or coverage of Covid-19 treatments on an individual’s vaccination status, providing incentives for Covid-19 vaccination is generally permissible. Such incentives may be provided through existing regulations around programs of health promotion and disease prevention (known as “wellness programs”). These may include discounts or surcharges of up to 30 percent of the total cost of employee-only coverage. However, any such discount must meet existing regulatory requirements, including: 

  • The wellness program must be reasonably designed to promote health or prevent disease.
  • Issuers must provide a reasonable alternative to qualify for the discount, such as attesting to following other Covid-19-related guidelines, to “individuals for whom it is unreasonably difficult due to a medical condition or medically inadvisable to obtain the Covid-19 vaccination.”
  • Individuals must be offered the opportunity to qualify at least once per year.

CMS notes that in the determination of whether employer-sponsored coverage is affordable under the Affordable Care Act, premium discounts or reductions are disregarded, but premium surcharges would not be.
 
The FAQs are available here.
 
CMS Releases Data on Utilization of Z-Codes for Social Determinants of Health
On October 6th, the CMS Office of Minority Health announced the release of a “Data Highlight” on the use of “Z-codes” among Medicare fee-for-service (FFS) beneficiaries in2019. Z-codes are a set of ICD-10-CM diagnosis codes that indicate certain social, economic, and environmental factors known to affect health and health outcomes.
 
CMS found that 1.59% of Medicare FFS beneficiaries had claims with Z codes in 2019, up from 1.31% in 2016. The five most utilized Z codes in 2019 were: homelessness (Z59.0), disappearance and death of a family member (Z63.4), problems related to living alone (Z60.2), problems related to living in a residential institution (Z59.3), and problems in relationship with spouse or partner (Z63.0).
 
The report also includes certain findings on subpopulations and demographic groups (e.g., age, gender). For example, full benefit dual eligible enrollees were overrepresented in claims with Z codes, accounting for 22.1% of the total Medicare FFS population, but 44.1% of beneficiaries with any Z-code claim.
 
The full report is available here.

Other Updates

GAO Issues Report on Provider Experiences with MIPS
On October 1st, the Government Accountability Office (GAO) published a report entitled “Provider Performance and Experiences Under the Merit-Based Incentive Payment System.” The congressionally mandated report analyzed MIPS data for performance years 2017 through 2019, and summarized interviews with officials from CMS and individuals from 11 selected professional organizations representing MIPS-eligible providers from various specialties.

The report found that at least 93% of providers earned a small positive adjustment in 2017 through 2019, with between 72% and 84% of providers earning an exceptional performance bonus, depending on the year. However, stakeholders still had mixed opinions on the MIPS program. Some of those GAO interviewed thought bonus points helped increase scores for certain providers who might otherwise be disadvantaged, but the majority stated that the program may not have meaningfully improved quality of care or patient health outcomes, and that MIPS may incentivize reporting over quality improvement, allowing providers to report on measures on which they perform well, rather than on measures in areas that need improvement.

The full report can be found here.

Premier Releases Data on Hospitals’ Pandemic Labor Costs
On October 6th, Premier, Inc. released data showing that hospitals paid $24 billion more for labor during the Covid-19 pandemic compared to a pre-pandemic baseline. The study found that clinical labor costs are up by an average of 8% per patient day, translating to $17 million in additional annual labor expenses for the average 500-bed facility since the pandemic began. Overall, overtime hours are up 52% as of September 2021, and the use of agency and temporary labor is up by 132% for full time workers and 131% for part-time workers. The use of contingency labor is also up nearly 126%.

Productivity, measured in worked hours per unit of departmental volume, also increased by an average of 7% to 14% year over year across intensive care, nursing, and emergency department units. In addition, the use of sick time, particularly among FTEs in the intensive care unit, was up 50% or full-time clinical staff and more than 60% for part-time employees compared to a pre-pandemic baseline. Turnover is also up, with rates across departments increasing from 18% to 30%.

The full report is available here.

Congressional Hearings

Previous Hearings:

  • On October 7th, the Senate Commerce, Science, and Transportation Subcommittee on Communications, Media, and Broadband held a hearing entitled “State of Telehealth: Removing Barriers to Access and Improving Patient Outcomes” that examined utilization of and changes to telehealth services during the COVID-19 pandemic, as well as the development of policies to address the needs of underserved communities. The hearing was scheduled after SPG’s previous weekly update was distributed. A recording of the webcast is available here.

Wednesday, October 13th:

  • At 2pm, the House Veterans Affairs Subcommittee on Health will hold a legislative hearing on 13 bills, including the Veteran Peer Specialist Act of 2021 (H.R.4575), the Expanding the Families of Veterans Access to Mental Health Services Act (H.R.5029), and the Making Advances in Mammography and Medical Options for Veterans Act (H.R.4794). More information is available here.

New York State Updates

DOH to Hold Webinar on SHCFTP Capital Funding Round 3
Last week, DOH and the Dormitory Authority of the State of New York (DASNY) released a Request for Applications (RFA) for Phase Three of the Statewide Health Care Facility Transformation Program (SHCFTP III). DOH will host an optional webinar on October 14th at 3pm to review this opportunity. Interested applicants may register for the webinar here.
 
The full RFA is available here and SPG’s detailed summary is available here. Applications are due on January 12, 2022.
 
Governor Hochul Expands Covid-19 Vaccine Mandate to Staff in OMH and OPWDD Hospitals
On October 5th, Governor Hochul announced that New York’s mandate for health care workers to receive Covid-19 vaccinations will be expanded to include employees who work in Office of Mental Health (OMH) psychiatric hospitals and Office for People with Developmental Disabilities (OPWDD) specialty hospitals. Unvaccinated employees at these settings will be required to submit to weekly testing beginning October 12th, and will be required to show proof of at least one Covid-19 vaccine dose by November 1st without a test-out option.
 
These requirements do not yet apply to OMH or OPWDD community-based providers. However, Governor Hochul has stated that she intends to continue expanding the vaccine requirement to additional human service and mental hygiene care settings in the coming weeks.
 
The Governor’s press release is available here.
 
NYS Receives CMS Approval for Transition of Some Behavioral Health HCBS to CORE Services
On October 5th, CMS approved New York’s request to transition a subset of adult behavioral health home and community-based services (BH HCBS) to a new service array called Community Oriented Recovery and Empowerment (CORE) services.

Unlike the adult BH HCBS services, CORE services will be available to all Health and Recovery Plan (HARP) members and HIV Special Needs Plans (SNP) members meeting HARP eligibility criteria, following a recommendation by a Licensed Practitioner of the Healing Arts (LPHA). As part of this transition, the following adult BH HCBS will transition to CORE: 

  • Community Psychiatric Support and Treatment (CPST)
  • Psychosocial Rehabilitation (PSR)
  • Family Support and Training (FST)
  • Empowerment Services – Peer Support

The CMS approval letter is available here. On October 1st, OMH and the Office of Addiction Services and Supports (OASAS) held a joint webinar outlining the transition to CORE services. The presentation is available here. DOH will provide adequate notice to providers prior to the official implementation of the CORE services.
 
DFS and DOH Release Health Care Administrative Simplification Workgroup Report
On October 4th, the NYS Department of Financial Services (DFS), in conjunction with DOH, released a report (available here) to the NYS Legislature that includes recommendations for reducing health care costs and complexities for consumers, providers, and health insurers. Recommendations were developed by the Health Care Administrative Simplification Workgroup, which was established by the fiscal year 2021 enacted NYS Budget and was tasked with evaluating mechanisms to reduce health care administrative costs through standardization, simplification, and technology.
 
The Workgroup made a total of 25 recommendations, including recommendations related to: 

  • Simplifying the credentialing process;
  • Streamlining preauthorization practices;
  • Improving access to electronic medical records;
  • Modernizing the claims submission and payment process; and
  • Standardizing insurance eligibility verification processes.

The DFS press release is available here.
 
DFS Issues Circular Letter to Insurers Regarding Suspension of Certain Utilization Review Requirements and Appeal Timeframes
On October 7th, DFS issued a circular letter (available here) to insurance plans notifying them that, in accordance with Governor Hochul’s recent Executive Order (available here) addressing health care facility staffing shortages, certain utilization review requirements and appeal timeframe must be suspended upon notification from a hospital or nursing home that such suspension is needed to increase the availability of staff. The suspension must remain in effect until the Executive Order expires or upon notification from a hospital or nursing home that the suspension is no longer needed.
 
The suspension may include the following requirements: 

  • Preauthorization requirements for scheduled surgeries and admissions at hospitals and outpatient hospital services;
  • Concurrent review for inpatient and outpatient hospital services;
  • Retrospective review for inpatient and outpatient hospital services at in-network hospitals;
  • Preauthorization for home health care services and inpatient rehabilitation services following a hospital admission; and
  • Internal and external appeal timeframes for hospitals.

A hospital or nursing home must use the certification form developed by DFS and DOH (available here) to delineate which requirements it is requesting to be suspended, and it must request suspension for all insurers with which it contracts. Questions may be sent to health@dfs.ny.gov.
 
DOH Proposes to Increase Rates for ACT Services
On October 6th, DOH posted a notice in the State Register (available here) outlining its intent to increase rates for Assertive Community Treatment (ACT) services, as follows: 

  • Permanently increase rates by 5 percent, effective October 7th. Rates will be increased by an additional 5 percent (for a total increase of 10 percent) from October 7th through March 31, 2022. On April 1, 2022, rates will be reduced by 5 percent.
  • Increase rates by an additional 8.2 percent from October 7th through March 31, 2022, to allow providers to increase recruitment and retention through loan forgiveness, tuition reimbursement, and signing bonuses, among other initiatives.
  • Increase rates by an additional 50 percent for 10 newly licensed Youth ACT teams serving individuals up to age 21 from October 7th through March 31, 2022.
  • Increase rates by an additional 50 percent for Young Adult ACT teams from October 7th through March 31, 2022.

The proposed rate enhancements are contingent upon CMS approval of the State’s spending plan for the enhanced Federal Medical Assistance Percentage (FMAP) for home and community-based services (HCBS) contained in the American Rescue Plan (ARP). Stakeholders may submit public comments on the proposed training enhancements via email to spa_inquiries@health.ny.gov.
 
HERO Act Designation Extended Through October 31st
On September 30th, DOH extended its designation of Covid-19 as an airborne infectious disease that presents serious risk of harm to the public health in New York State. This designation, initially implemented on September 6th, triggers the HERO Act that requires all employers to implement workforce safety plans to protect employees against exposure and disease. The designation will now run through October 31st.
 
The Commissioner’s designation is available here and additional details on the HERO Act are available here.
 
DOH to Require Cultural Competency Training for Managed Care Providers
On October 4th, DOH announced approval of a cultural competency training offered by the United States Office of Minority Health education program, entitled “Think Cultural Health.” Medicaid managed care plans should begin notifying participating providers of the requirement to complete the training within the next 12 months and annually thereafter. Behavioral health providers may complete either the “Think Cultural Health” training or the previously approved cultural competency training for behavioral health providers (available here). The training is available online and is free to providers.
 
The DOH memo is available here. Questions may be submitted to OMCmail@health.ny.gov.