Weekly Health Care Policy Update – November 12, 2021

November 19, 2021

In this update: 

  • Covid-19 Updates
    • States Begin Legal Challenges to Federal Vaccine Mandates; Fifth Circuit Temporarily Blocks Large Employer Mandate
    • Pfizer Asks FDA to Approve Boosters for Anyone 18 and Older
    • HHS Invests $650 Million in Rapid Molecular Covid-19 Tests
    • White House Extends FEMA Virus Relief for States
  • Administration
    • Robert Califf Nominated as FDA Commissioner
    • Administration Accepts Health Equity Task Force Final Report, Announces Equity Investments
  • Legislative
    • House Passes Infrastructure Bill; Biden to Sign Monday
    • CBO Releases Some Estimates on Build Back Better Act
  • Regulatory
    • CMS Issues Revised Funding Methodologies for Basic Health Program
    • CMS Finalizes Repeal of Medicare Breakthrough Technologies Rule
  • Other
    • MedPAC Holds November Meeting
    • Analysis Says CMS Overpaid MA Plans Due to Excess Risk Scores
  • Congressional Hearings
  • New York State Updates
    • Governor Hochul Announces New Administration Nominations and Appointments
    • DOH and OMH Update Mental Health Outpatient Provider Rates to Reflect Minimum Wage Increases
    • DOH Announces HANYS Geriatric Emergency Department Initiative
    • DOH Announces Children’s Waiver Renewal Feedback Webinar

COVID-19 Updates

States Begin Legal Challenges to Federal Vaccine Mandates; Fifth Circuit Temporarily Blocks Large Employer Mandate
This week, several Republican-controlled states along with some businesses and associations have begun legal challenges to the two rules released by the Biden Administration last week which implement Covid-19 vaccination mandates for Medicare and Medicaid-participating health care facilities and for large employers. At least 27 states filed 12 challenges to the large employer rule issued by the Occupational Health and Safety Administration (OSHA), selecting the most conservative federal appeals circuits in which to file their cases. Similarly, at least 11 states have also announced plans to challenge the health care facility vaccination mandate issued by the Centers for Medicare and Medicaid Services (CMS).
 
On November 6th, a three-judge panel of the Fifth Circuit temporarily blocked the OSHA rule for large employers on the grounds that the rule raises “grave statutory and constitutional issues.” The rule requires all companies with at least 100 employees to require unvaccinated workers to mask indoors starting December 5th and undergo weekly testing beginning January 4th. In its defense, filed November 8th, the Justice Department (DOJ) asserts that the plaintiffs failed to demonstrate their claimed injuries outweigh the harm of blocking the regulations. DOJ further asked the court to consolidate multiple challenges and choose at random a federal circuit court to hear the combined cases, as is required by federal law. A decision on consolidation and jurisdiction could come during the week of November 15th. Ultimately, the issue is likely to be decided by the Supreme Court.
 
Pfizer Asks FDA to Approve Boosters for Anyone 18 and Older
On November 9th, Pfizer/BioNTech asked the Food and Drug Administration (FDA) to approve a booster dose of its Covid-19 vaccine for anyone 18 and older. In September, the FDA approved Pfizer/BioNTech boosters for anyone over 65, or those at greater risk of Covid-19 infection due to their job or living conditions. The companies’ data show that a booster increased protection against symptomatic infection to about 95%, even amid the Delta wave, and that side effects were similar to those seen with the first two shots. If the FDA approves the request, the Centers for Disease Control and Prevention (CDC) will then consider whether to make a recommendation for its use.
 
HHS Invests $650 Million in Rapid Molecular Covid-19 Tests
On November 10th, the Department of Health and Human Services (HHS) announced that it would invest $650 million in American Rescue Plan (ARP) funding to strengthen manufacturing of rapid point-of-care Covid-19 molecular tests by American manufacturers to increase access to such diagnostic testing. Rapid molecular tests are used by hospitals, urgent care centers, pharmacies, and other community health care organizations to diagnose Covid-19, screen patients before surgery, identify individuals who may benefit from Covid-19 therapies, and confirm at-home test results. The funding will strengthen domestic production of rapid molecular tests, including through the purchase of raw materials and finished tests.
 
The press release can be found here.
 
White House Extends FEMA Virus Relief for States
On November 9th, President Biden issued a memorandum extending the federal government’s 100% reimbursement of COVID-19 emergency response costs incurred by states, tribal governments, and territories through April 1, 2022. The Presidential Memorandum directs the Federal Emergency Management Agency (FEMA) to continue FEMA-sponsored vaccination clinics and vaccination public education campaigns, as well as full federal funding of National Guard emergency response efforts. This memorandum extends an order President Biden signed on his second day in office, which applied the 100% federal funding policy through September 2021. In August, Biden extended the policy through the end of 2021.
 
The memorandum is available here.

Administration Updates

Robert Califf Nominated as FDA Commissioner
Today (November 12th), the White House announced that it has nominated Dr. Robert Califf to serve as FDA Commissioner. Dr. Califf previously served as FDA Commissioner under the Obama Administration from 2016-17. Dr. Califf is a professor of medicine at Duke University and has recently served as a senior advisor to Verily Life Sciences and its sister company Google Health.
 
The announcement is available here.
 
Administration Accepts Health Equity Task Force Final Report, Announces Equity Investments
On November 10th, the Biden Administration announced that it had officially accepted the report of the Covid-19 Health Equity Task Force, chaired by Dr. Marcella Nunez-Smith. Alongside the report, the Administration announced a total of $785 million in associated investments from the ARP to support the following health equity efforts: 

  • Public Health Workforce: $240 million for a new program administered by the Health Resources and Services Administration (HRSA) to build the pipeline of public health workers in underserved communities. This initiative will fund apprenticeship programs at over 500 sites nationally, with a goal of training 13,000 community health workers (CHWs) and paraprofessionals.
  • Indian Health Service: $210 million for school nurses, public health capacity, loan repayment, and epidemiology work in Tribal Nations.
  • Disability and Aging Networks: $150 million through the Administration for Community Living (ACL) to disability and aging networks to increase the public health workforce and collaborate with public health systems.
  • Community-Based Vaccine Outreach: $77 million in additional funding for the HRSA community-based organization vaccine outreach initiative established in May, and $66.5 million in new funding to support community-based organizations specifically focusing on the medically vulnerable and underserved. Applicants may submit applications for the new funding initiative on Grants.gov here by December 10th.
  • CDC Diversity Investments: $35 million for the CDC to expand activities in recruitment and pipeline programs in public health to increase interest among underrepresented groups.

The Administration’s press release is available here. The Task Force report is available here.

Legislative Updates

House Passes Infrastructure Bill; Biden to Sign Monday
On November 5th, the House of Representatives passed the Infrastructure Investment and Jobs Act (H.R. 3684) by a vote of 228-206, with 13 Republicans voting in favor and 6 Democrats against. President Biden is expected to sign the bill into law on Monday, November 15th. The bill, which contains roughly $550 billion in new spending, is focused on physical infrastructure such as roads, bridges, electricity, and broadband, and does not include specific health care investments. However, the bill does contain some minor health care provisions that would pay for the cost of the bill, including the extension of the Medicare sequester through 2031. The text of the bill is unchanged from the version passed by the Senate and described in SPG’s August 13th update.
 
CBO Releases Some Estimates on Build Back Better Act
On November 9th, the Congressional Budget Office (CBO) published a blog post on its timeline for releasing cost estimates of the Build Back Better Act (H.R. 5376). Some House Democrats refused to vote in favor of the bill until CBO published a full cost estimate. CBO indicated that it will release estimates for individual titles of the bill as it completes them, and that other titles will take longer due to interacting provisions. It will provide advance notice when it has a release date for the cost of the entire bill. So far, CBO has released estimates for four titles of the bill, which do not include health care items.
 
The blog post is available here. CBO’s cost estimates are available here.

Regulatory Updates

CMS Issues Revised Funding Methodologies for Basic Health Program
On November 10th, the Center for Medicaid & CHIP Services (CMCS) issued an informational bulletin to update funding methodologies for Basic Health Program (BHP) years 2020 and 2021 due to changes contained in the ARP. Because states’ BHP funding is based in part on the cost of Marketplace coverage, the enhancements to Marketplace subsidies in the ARP resulted in increased funding for the two states operating a BHP, New York and Minnesota. New York is expected to receive an additional $750 million for program years 2020 and 2021.
 
Provisions of the ARP relevant to BHP payments include the enhanced advance premium tax credits (APTCs) for Affordable Care Act plans, temporary changes to the limit on reconciliation of the tax credits (in the event an enrollee misestimates their income), and enhanced premium tax credits for individuals receiving unemployment assistance. Together, these three provisions resulted in an increased projection of the APTCs that otherwise would be paid for BHP enrollees as well as an increased income reconciliation factor (by 3% in 2020 and 1.4% in 2021). CMS will issue updated payments to states based on estimated enrollment data and notify states when the payments will be issued.
 
The information bulletin is available here. HHS also issued a press release on the increases here, which notably stated that the Administration “stands poised to lend expertise to others considering the program.”
 
CMS Finalizes Repeal of Medicare Breakthrough Technologies Rule
On November 12th, CMS finalized a rule that will repeal the Trump Administration’s rule on Medicare coverage of innovative technologies. The final rule repeals both the original rule’s coverage pathway for “breakthrough technologies” designated as such by the FDA and its codified definition of “reasonable and necessary,” which would have encompassed any items or services approved in the commercial market unless evidence indicated they should not be included.
 
As covered in SPG’s September 17th Update, CMS proposed the repeal on September 13thbecause of the potential for coverage of technologies based on insufficient evidence and because it would impede Medicare’s ability to make case-by-case determinations. CMS intends to pursue further stakeholder engagement on this topic as well as the “reasonable and necessary” definition. CMS also noted that it will not be issuing subregulatory guidance related to the consideration of commercial insurance coverage, and that its longstanding position not to consider costs as part of coverage determinations is “not because of a statutory prohibition.”
 
The text of the final rule is available here.

Other Updates

MedPAC Holds November Meeting
On November 8th and 9th, the Medicare Payment Advisory Commission (MedPAC) met for its monthly public meeting. The agenda included:

  • Benchmark incentives for accountable care organizations (ACOs)
  • Medicare payment policies to support safety net providers
  • Telehealth: Updates on use, beneficiary and clinical experiences
  • Aligning fee-for-service payment rates across ambulatory settings
  • Part D for residents in long-term care facilities

The first presentation was particularly notable, including a discussion of how Medicare might forecast cost trends as part of a revised benchmark approach. MedPAC staff stated that the resetting of benchmarks after each performance period makes it increasingly hard for ACOs to continually generate savings and threatens long-term participation by ACOs in the program. MedPAC commissioners agreed to explore how to get rid of this “ratcheting” effect, especially in the context of the CMS Innovation Center’s (CMMI) recent white paper discussing its aim to have all Medicare beneficiaries in value-based arrangements by 2030.
 
Other discussion included: moving to a definition of “safety-net providers” weighed towards populations served; equity between audio-only and audio-visual telehealth payments; the in-person visit requirement for use of telehealth in behavioral health; support for the creation of acuity-adjusted ambulatory payment classifications; additional research into ambulatory site-specific neutrality; and concern over medication management practices in nursing homes and assisted living facilities.
 
Materials from the MedPAC meeting can be found here. The CMMI white paper can be found here.
 
Analysis Says CMS Overpaid MA Plans Due to Excess Risk Scores
On November 11th, Kaiser Health News published a summary of an analysis by Richard Kronick on the effect of the coding adjustment factor in Medicare Advantage (MA). Kronick’s analysis, which focused on risk scoring and coding policies, found that risk scores were 19% higher in MA plans than in Original Medicare in 2019. Although CMS may implement a coding intensity adjustment to reduce MA risk scores, the adjustment has been set at 5.9%, the minimum amount required by law, since 2018. As a result, Kronick estimates that Medicare overpaid MA plans by more than $106 billion from 2010 through 2019, with the extra spending increasing significantly in recent years ($34 billion in 2018 and 2019).
 
The Kaiser Health News report is available here. Kronick was formerly HHS Deputy Assistant Secretary for health policy and the head of the Agency for Healthcare Research and Quality (AHRQ) under the Obama Administration.

Congressional Hearings

Wednesday, November 17th:

  • At 10:30am, the House Appropriations Subcommittee on Labor, Health and Human Services, Education, and Related Agencies will hold a hearing entitled “U.S. Role in Global COVID-19 Vaccine Equity.” More information is available here.
  • At 2pm, the House Select Subcommittee on the Coronavirus Crisis will hold a hearing entitled “Combating Coronavirus Cons and the Monetization of Misinformation.” More information is available here.

New York State Updates

Governor Hochul Announces New Administration Nominations and Appointments
On November 9th, Governor Hochul announced the following nominations and appointments to her administration:  

  • Dr. Chinazo Cunningham has been nominated as Commissioner of the Office of Addiction Services and Supports (OASAS). Cunningham most recently served as the Executive Deputy Commissioner of Mental Hygiene at the New York City Department of Health and Mental Hygiene. Cunningham will require confirmation from the New York State Senate and will serve as Acting Commissioner in the interim.
  • Reverend Viviana DeCohen has been appointed Director of the New York State Division of Veterans’ Services. DeCohen is a veteran of the U.S. Marine Corps who most recently served the city of Mt. Vernon as its Commissioner of Veterans’ Affairs. 
  • Kylah Hynes has been appointed Director of Federal Affairs. Hynes most recently served as the Director of Federal Affairs for the New York Metropolitan Transportation Authority.

The Governor’s press release is available here.
 
DOH and OMH Update Mental Health Outpatient Provider Rates to Reflect Minimum Wage Increases
On October 8th, the New York State Department of Health (DOH) and Office of Mental Health (OMH) issued a memorandum to Medicaid Managed Care Plans (MMCPs), HIV Special Needs Plan (HIV SNPs), and Health and Recovery Plans (HARPs) to notify them of and ensure compliance regarding enhanced reimbursement rates resulting from an increase to the minimum wage.
 
Effective January 1, 2022, mental health outpatient provider rates will be increased to reflect the legislatively mandated increases in minimum wage, as outlined in rate tables available here. MMCPs must complete necessary systems edits to ensure payable claims are reimbursed at the newly effective rates and are required to conduct retrospective reconciliation to adjust payment for claims as necessary within 90 days of receipt of the memorandum.
 
Questions may be submitted to BHO@omh.ny.gov.
 
DOH Announces HANYS Geriatric Emergency Department Initiative
Today (November 12th), DOH announced that the Healthcare Association of New York State (HANYS) is launching a geriatric emergency department initiative, which will provide funding to ten New York State hospitals pursuing Geriatric Emergency Department Accreditation through the American College of Emergency Physicians. Participating hospitals will work with HANYS to implement geriatric-focused policies and protocols, improve staffing and education, refine transitions of care processes, and optimize the physical environment to serve older adults presenting to the emergency department. HANYS will help each hospital select the appropriate accreditation level, provide tailored education and technical assistance, and cover accreditation fees.
 
Any New York State hospital with an emergency department may enroll in the HANYS learning collaborative. Interested hospitals may email Morgan Black at mblack@hanys.orgby November 29th to reserve a spot. Training will begin in January 2022.
 
DOH Announces Children’s Waiver Renewal Feedback Webinar
DOH will be hosting a webinar on December 6th from 1pm-2:30pm to review feedback received from stakeholders regarding the Children’s Waiver renewal. Registration for the webinar is available here. Questions may be submitted to BH.Transition@health.ny.gov.