A&B Healthcare Week in Review, April 11, 2014

I. REGULATIONS, NOTICES, & GUIDANCE

• On April 7, 2014, the Centers for Medicare and Medicaid Services (CMS) issued the Announcement of Calendar Year (CY) 2015 Medicare Advantage (MA) Capitation Rates and Medicare Advantage and Part D Payment Policies and Final Call Letter. CMS received over 1,300 comments on the Advance Notice and Draft Call Letter for 2015, released February 21, 2014, and made several key changes to their proposal in response to stakeholder feedback. Although payments will vary by plan based on its location and star rating, overall, CMS estimates the net change to plan payments between 2014 and 2015 to be +0.4 percent, compared to the -1.9 percent effect of proposed rates and policies issued in the preliminary notice. Among its key provisions, the final call letter requires plans to notify CMS 90 days before making significant changes to their provider networks, and allows enrollees to switch plans if they are affected by significant mid-year provider terminations. CMS also said that it plans to study the issue of beneficiary access to “preferred” pharmacy networks in Part D. Specifically, CMS will “analyze beneficiaries’ geographic access (i.e. time and distance) to pharmacies offering preferred cost sharing in plans’ networks”. Regarding the MA Star Ratings Quality Bonus demonstration (which had provided quality bonus payments for a broader set of MA plans, with lower quality scores from the MA Star Rating system, than what would be provided under current law) CMS believes that the demonstration’s three-year duration will be sufficient to test the hypothesis of whether providing scaled quality bonuses leads to greater quality improvement. As a result, CMS will terminate the bonus demonstration at the end of this year, as scheduled. Also of note, CMS said that it has decided not to finalize the proposal to exclude diagnoses from enrollee home-based risk assessments at this time, but it may reconsider the proposal in a future plan year. A fact sheet on the announcement may be found here. MA and drug plan bids are due in June, and MA enrollment starts October 15th.
• On April 7, 2014, the Centers for Disease Control and Prevention (CDC) published a notice announcing that a proposed project, entitled “Customer Surveys Generic Clearance for the National Center for Health Statistics”, is under review by the Office of Management and Budget (OMB). As part of a comprehensive program, the National Center for Health Statistics (NCHS) plans to continue to assess its customers' satisfaction with the content, quality and relevance of the information it produces. NCHS will conduct voluntary customer surveys to assess strengths in agency products and services and to evaluate how well it addresses the emerging needs of its data users. Results of these surveys will be used in future planning initiatives. Systematic surveys of several groups will be folded into the program. Among these are Federal customers and policy makers, state and local officials who rely on NCHS data, the broader educational, research, and public health community, and other data users. Comments are due June 4, 2014.
• On April 7, 2014, the Food and Drug Administration (FDA) solicited comments on the proposed extension of the collection of information concerning requirements relating to FDA's Adverse Experience Reporting System (AERS) for licensed biological products, and general records associated with the manufacture and distribution of biological products. The primary purpose of FDA's AER system is to identify potentially serious safety problems with licensed biological products. Respondents to this collection of information include manufacturers of biological products and any person whose name appears on the label of a licensed biological product. Comments are due June 6, 2014.
• On April 7, 2014, FDA solicited comments on a generic clearance to collect information to support communications used by FDA about drug products. FDA will use this mechanism to test messages about regulated drug products on a variety of subjects related to consumer, patient, or health care professional perceptions and about use of drug products and related materials, including but not limited to, direct-to-consumer prescription drug promotion, physician labeling of prescription drugs, Medication Guides, over-the-counter drug labeling, emerging risk communications, patient labeling, online sale of medical products, and consumer and professional education. Comments are due June 6, 2014.
• On April 7, 2014, FDA issued guidance for industry on “Updating Labeling for Susceptibility Test Information in Systemic Antibacterial Drug Products and Antimicrobial Susceptibility Testing Devices”. The guidance describes procedures and responsibilities for updating information on susceptibility test interpretive criteria, susceptibility test methods, and quality control parameters in the labeling for systemic antibacterial drug products for human use, and also describes procedures for making corresponding changes to susceptibility test interpretive criteria for antimicrobial susceptibility testing devices. Comments are due June 6, 2014.
• On April 8, 2014, the CDC announced that it had reopened the comment period on the CDC Draft Guideline for the Prevention of Surgical Site Infections (SSI). The draft Guideline is designed for use by infection prevention staff, healthcare epidemiologists, administrators, nurses, and personnel responsible for developing, implementing, and evaluating infection prevention and control programs for healthcare settings across the continuum of care. The recommendations contained in the draft Guideline are based on a targeted systematic review of the best available evidence for specific topics related to the prevention of surgical site infections (SSI). Comments are due May 8, 2014.
• On April 8, 2014, CMS issued a notice of a new system of records, “Hospice Item Set (HIS) System”. The new system will support the collection of data required for the Hospice Quality Reporting Program (HQRP). HIS is a standardized, patient-level data collection vehicle consisting of data elements confirming that the appropriate assessments were made and inquiries or concerns were addressed for each patient at the time of admission for the following domains of care: (1) Pain; (2) Respiratory Status; (3) Medications; (4) Patient Preferences; and (5) Beliefs Values. The new system is effective May 9, 2014. Comments should be submitted on or before the effective date.
• On April 8, 2014, FDA announced that it is extending to May 7, 2014, the comment period for the draft guidance document entitled “Blood Glucose Monitoring Test Systems for Prescription Point-of-Care Use.” FDA also announced this week that the Agency is extending to May 7, 2014 the comment period for the draft guidance document entitled “Self-Monitoring Blood Glucose Test Systems for Over-the-Counter Use”.
• On April 8, 2014, FDA announced the availability of draft guidance for industry entitled “Immunogenicity-Related Considerations for the Approval of Low Molecular Weight Heparin for NDAs and ANDAs.” This guidance discusses how applicants for low molecular weight heparin (LMWH) products should provide information on impurities and the potential impact on immunogenicity. Comments must be submitted by June 9, 2014 for consideration before the Agency begins work on final guidance.
• On April 9, 2014, FDA announced the availability of draft guidance for industry, researchers, patient groups, and FDA staff entitled “Meetings With the Office of Orphan Products Development.” This draft guidance provides recommendations to industry, researchers, patient groups, and other stakeholders interested in requesting a meeting with FDA's Office of Orphan Products Development (OOPD) on issues related to orphan drug designation requests, humanitarian use device (HUD) designation requests, rare pediatric disease designation requests, funding opportunities through the Orphan Products Grants Program and the Pediatric Device Consortia Grants Program, and orphan product patient-related topics of concern. This draft guidance document is intended to assist these groups with requesting, preparing, scheduling, conducting, and documenting meetings with OOPD. Comments must be submitted by June 9, 2014 for consideration before the Agency begins work on final guidance.
• On April 9, 2014, the FDA Center for Drug Evaluation and Research (CDER) announced the establishment of a docket to receive suggestions, recommendations, and comments on innovative packaging, storage, and disposal systems, technologies or designs that could be used to prevent or deter misuse and abuse of opioid analgesics by patients and others. FDA is interested in receiving comments on new designs as well as enhancements to existing designs, and is particularly interested in comments from academic institutions, regulated industry, technology companies (e.g., those producing technologies for medication adherence, disposal, or tracking), healthcare professionals, patient representatives, clinical trial service providers, and other interested organizations. Comments submitted in response to this notice will help the Agency determine whether innovative designs for opioid analgesic packaging, storage, and/or disposal systems could help prevent or deter misuse and abuse without diminishing access for patients with legitimate prescriptions. Responses are due June 9, 2014.
• On April 9, 2014, FDA announced that it had submitted a proposed information collection, entitled “Food and Drug Administration Generic Rapid Response Surveys”, to OMB for review and clearance. The Federal Food, Drug, and Cosmetic Act requires that important safety information relating to all human prescription drug products be made available to FDA so that it can take appropriate action to protect the public health when necessary. FDA is seeking OMB clearance to collect vital information via a series of rapid response surveys. Participation in these surveys will be voluntary. This request covers rapid response surveys for community based health care professionals, general type medical facilities, specialized medical facilities (those known for cardiac surgery, obstetrics/gynecology services, pediatric services, etc.), other health care professionals, patients, consumers, and risk managers working in medical facilities. Comments are due May 9, 2014.
• On April 9, 2014, FDA announced that a proposed information collection entitled “Draft Guidance for Industry and FDA Staff; Total Product Life Cycle: Infusion Pump-Premarket Notification Submissions” had been submitted to OMB for review and clearance. This draft guidance is intended to assist industry in preparing premarket notification submissions for infusion pumps and to identify device features that manufactures should address throughout the total product life cycle. The draft guidance is available here. In the Federal Register of April 26, 2010 (75 FR 21632), FDA published a notice seeking comment on the guidance. Given the lapse in time since its publication, FDA is reissuing this notice, responding to a single comment and providing the public an additional opportunity to comment prior to the issuance of the final guidance document. Comments are due May 9, 2014.
• On April 10, 2014, FDA released an information collection request entitled “Exception From General Requirements for Informed Consent”. This notice solicits comments on the collection of information related to the use of investigational in vitro diagnostic devices to identify chemical, biological, radiological, or nuclear agents without informed consent in certain circumstances. Comments are due June 9, 2014.
• On April 10, 2014, CMS issued an announcement of requirements and registration for the “Data Supporting Decisions Challenge”. CMS stated that data made publicly available for the first time in recent months has great potential to further the nation's understanding of health care spending and physician practice patterns. Because this data exists in raw forms that require interpretation and context, to make an impact on the average consumer it must be presented in ways that they can understand. This challenge seeks the creation of interactive data visualization tools that communicate complex data from multiple sources in ways that support consumer decision making for value based health care. The challenge is broken into two phases: In Phase I, participants will submit a proposal of no more than 750 words describing the use case for their visualization(s), how their approach will address the use case, and the data sources they intend to use. In Phase II, the finalists will build out their visualization tools to the most complete extent possible. The Phase I submission period will be April 14- April 24, 2014.
• On April 11, 2014, CMS issued the following information requests: 1) Cooperative Agreement to Support Navigators in Federally-facilitated and State Partnership Exchanges; and 2) Improving Quality of Care in Medicaid and CHIP through Increased Access to Preventive Services State Survey. Comments are due June 10, 2014. More information may be found here.
• On April 11, 2014, CMS announced that the following information collection activities had been submitted to OMB for review and approval: 1) Quarterly Statement of Budget for Medical Assistance; 2) Quarterly Statement of Expenditure for Medical Assistance; 3) Health Care Reform Insurance Web Portal Requirements; 4) Medication Therapy Management Program Improvements; 5) Clinical Laboratory Improvement Amendments of 1988 (CLIA) Budget Workload Reports and Supporting Regulations; and 6) Medicaid Drug Program—Monthly and Quarterly Drug Reporting Format. Comments are due May 12, 2014. More information may be found here.
• The CMS Center for Medicare & Medicaid Innovation (CMMI) has issued a document detailing its “Priority Measures for Monitoring and Evaluation”. CMMI plans to use the quality measures for monitoring and evaluation of Innovation Center models where applicable. On a periodic basis, measures will be examined for relevance and new measures considered for inclusion.

Event Notices:

• April 25, 2014: Congressional health and research staff are invited to join on a brief tour of National Institutes of Health (NIH) medical research lab in Bethesda and watch demonstrations by leading medical scientists on Friday morning, April 25th. The American Institute for Medical and Biological Engineering (AIMBE) in partnership with the Academy of Radiology Research and NIH invite Congressional staff to meet National Institute of Biomedical Imaging and Bioengineering (NIBIB) Director Dr. Roderic Pettigrew and 6 scientists previewing cutting-edge medical research. Demonstrations will include work on neuroprosthesis to restore hand grasps in persons with complete paralysis and two microscopes used to observe real-time migration of cells to understand brain development. Transportation from Capitol Hill will be provided on Friday morning, April 25th, departing at 9:00 AM and returning at 12:00 noon. This event has been approved by House and Senate Ethics. This tour is intended for Congressional staff only. For details or to RSVP, contact Sarah Mandell at smandell@aimbe.org or 202-496-9661.
• April 28-29, 2014: The Department of Health and Human Services (HHS) issued a meeting notice for the Advisory Group on Prevention, Health Promotion, and Integrative and Public Health. Information about the Advisory Group and the agenda for this meeting may be found here. The meeting will take place at 200 Independence Ave. SW., Room 505A, Washington, DC 20201 on April 28, 2014. The meeting will take place via teleconference on April 29, 2014.
• April 29, 2014: HHS issued a meeting notice for the Advisory Council on Alzheimer's Research, Care, and Services. The Advisory Council on Alzheimer's Research, Care, and Services provides advice on how to prevent or reduce the burden of Alzheimer's disease and related dementias on people with the disease and their caregivers. During the April meeting, the Advisory Council will hear presentations from the three subcommittees (Research, Clinical Care, and Long-Term Services and Supports). The Advisory Council will hear updates to the 2014 plan. The Advisory Council will also hear presentations on state and local plans to address dementia. The meeting will be held from 9:00 AM to 5:00 PM in the Hubert H. Humphrey Building, 200 Independence Avenue SW., Washington, DC 20201.
• May 2, 2014: FDA will hold a meeting of the Nonprescription Drugs Advisory Committee. The committee will discuss data submitted by MSD Consumer Care, Inc., to support new drug application (NDA) 204804, for over-the-counter marketing of montelukast 10 milligram tablets. The meeting will take place from 8:00 AM to 4:30 PM in Gaithersburg, Maryland.

LEGISLATION & COMMITTEE ACTION

U.S. Senate

• On April 9, 2014, the Senate Primary Health and Aging Subcommittee of the Senate Health, Education, Labor and Pensions (HELP) Committee held a hearing entitled "Addressing Primary Care Access and Workforce Challenges: Voices from the Field." More information on the hearing may be found here.
• On April 10, 2014, the Senate Finance Committee held a hearing on 2015 budget proposals for HHS, with the HHS Secretary Kathleen Sebelius as the sole witness. More information on the hearing may be found here. During the hearing Sebelius explained that while the HHS FY 2015 Budget proposal makes critical public health investments, the budget also helps tackle the federal deficit with legislative proposals that would generate an estimated net $356 billion in health care savings over 10 years. She noted that 7.5 million Americans have signed up for Qualified Health Plans (QHPs) since enrollment opened last October, and said the Administration is collecting data on the number of uninsured individuals who enrolled and will feed this information to Congress as it becomes available. On Monday, Senate Judiciary Committee Ranking Member Chuck Grassley (R-IA) and Senate Finance Committee Ranking Member Orrin Hatch (R-UT) issued a letter to Sebelius expressing concern about the “severe technical glitches” plaguing State-Based Exchanges given that “The federal government has spent billions of dollars in grants to help states build their Exchanges”. They suggest that the technical difficulties experienced by enrollees raise “…questions about the sustainability of the exchange model”.

House of Representatives

• On April 7, 2014, the House Energy and Commerce Subcommittee on Health held a hearing entitled “Improving Predictability and Transparency in Drug Enforcement Administration (DEA) and Food and Drug Administration (FDA) Regulation”. Witnesses for Panel I were Dr. Janet Woodcock, M.D., Director of the Center for Drug Evaluation and Research (CDER) at FDA, and Joseph Rannazzisi, Deputy Assistant Administrator of the Office of Diversion Control at DEA. Witnesses for Panel II included Dr. Nathan Fountain, Chair of the Medical Advisory Board of the Epilepsy Foundation; John Gray, President and CEO of the Healthcare Distribution Management Association; D. Linden Barber, Partner and Director of DEA Compliance Operations at Quarles & Brady; Wendy K.D. Selig, President and CEO of the Melanoma Research Alliance; and Scott Faber, Vice President of Government Affairs at the Environmental Working Group (EWG). During the hearing Members and witnesses discussed the following pieces of legislation: the Improving Regulatory Transparency for New Medical Therapies Act (H.R. 4299); the Ensuring Patient Access and Effective Drug Enforcement Act (H.R. 4069); and the Sunscreen Innovation Act (H.R. 4250). More information on the hearing may be found here.
• On April 8, 2014, the House Committee on Ways and Means Subcommittee on Health held a hearing on the Treasury Department’s final employer mandate and employer reporting requirements regulations. The witness for the hearing was J. Mark Iwry, Senior Advisor to the Secretary and Deputy Assistant Secretary for Retirement and Health Policy at the U.S. Department of the Treasury. More information on the hearing may be found here.
• On April 10, 2014, the House voted 219-205 to approve a budget proposal (H. Con. Res. 96), introduced last week by Representative Paul Ryan (R-WI). The budget proposes to cut health spending by $2.9 trillion over a decade, primarily by repealing ACA coverage provisions. The Ryan budget would maintain provider taxes, and would use the funds to pay down the deficit. The proposal includes a voluntary private plan option for Medicare and would convert Medicaid into block grants for states. No Senate action is expected on a new annual budget.

III. REPORTS, STUDIES, & ANALYSES

• The Robert Wood Johnson Foundation released the results of a study which finds that 5.4 million US adults gained health insurance since September 2012—the first available estimate of how many uninsured people acquired coverage since enrollment in the ACA Health Insurance Exchanges began. Funded in part by the Robert Wood Johnson Foundation and conducted by researchers at the Urban Institute, the Health Reform Monitoring Survey (HRMS) shows that the percentage of uninsured Americans fell from 17.9% in September 2013 to 15.2% at the beginning of March. The data also show that declines in the number of uninsured Americans are considerably larger in states that expanded their Medicaid programs. More information on the study may be found here.
• A study commissioned by The Pew Charitable Trusts and conducted by Avalere Health examined how payers cover medical devices that come to market, and what role the extent of evidence generated to seek FDA approval impacts downstream coverage and payment for these devices. Avalere looked at two FDA regulatory approval pathways with different standards of evidentiary burden: the standard Premarket Approval (PMA) process and the Humanitarian Device Exemptions (HDEs) process for medical devices that address rare conditions. Avalere found that payers often cover humanitarian use devices despite the limited data, thus providing patients with a therapeutic option when no alternatives exist. The study also found that PMA devices that come to market with more evidence are not always covered by payers. More information on the study may be found here.
• The RAND Corporation issued a Health Reform Opinion Study (HROS), which estimates the number of people who have become enrolled in all sources of healthcare coverage since the implementation of the ACA. In addition to asking them about their opinions of the ACA, each month RAND collected information about enrollment in health insurance, including employer-sponsored insurance (ESI), Medicaid, Medicare, insurance purchased on a marketplace, and other insurance purchased on the individual market. The authors estimate that 9.3 million more people had coverage in March 2014 compared to September 2013, lowering the uninsured rate from 20.5% to 15.8%. They found that ESI plan enrollment increased by 8.2 million, and Medicaid enrollment increased by 5.9 million.
• According to a new Gallup-Healthways poll, in the U.S. the uninsured rate dipped to 15.6% in the first quarter of 2014, a 1.5-percentage-point decline from the fourth quarter of 2013. The uninsured rate is now at the lowest level recorded since late 2008. The uninsured rate has been falling since the fourth quarter of 2013, after hitting an all-time high of 18.0% in the third quarter. Even within this year's first quarter, the uninsured rate fell consistently, from 16.2% in January to 15.6% in February to 15.0% in March. And within March, the rate dropped more than a point, from 15.5% in the first half of the month to 14.5% in the second half -- indicating that enrollment through the healthcare exchanges increased as the March 31 deadline approached. The full results may be found here.
• On April 8, 2014, the Government Accountability Office (GAO) and Office of Inspector General (OIG) issued reports on the CMS durable medical equipment (DME) competitive bidding program round one rebid. Under the Medicare competitive bidding program (CBP) only competitively selected contract suppliers can furnish certain durable medical equipment (DME) product categories (such as oxygen supplies and hospital beds) at competitively determined prices to Medicare beneficiaries in designated competitive bidding areas. The CBP's round 1 rebid was in effect for a 3-year period, from 2011 through 2013, and included nine DME product categories in nine geographic areas. Both reports found that the DME competitive bidding program is generally in compliance with federal requirements and is reducing DME utilization, but continued monitoring and oversight are needed to ensure that patient access is not compromised. The GAO report may be found here, and the OIG report may be found here.
• On April 10, 2014, OIG issued a report entitled “Limited Compliance with Medicare’s Home Health Face-to-Face Documentation Requirements”. The ACA requires that practitioners who certify beneficiaries as eligible for Medicare home health services document that face-to-face encounters with those beneficiaries occurred, as a condition of payment for home health services. The study sought to determine the extent to which physicians document face-to-face encounters and assess CMS’ oversight of the face-to-face requirement. OIG found that for 32% of home health claims that required face-to-face encounters, the documentation did not meet Medicare requirements, resulting in $2 billion in payments that should not have been made. OIG recommended that CMS 1) consider requiring a standardized form to ensure that physicians include all elements required for the face-to-face documentation; 2) develop a specific strategy to communicate directly with physicians about the face-to-face requirement; and 3) develop other oversight mechanisms for the face-to-face requirement.

IV. OTHER HEALTH POLICY NEWS

• CMS this week announced the release of a public data set, the Medicare Provider Utilization and Payment Data: Physician and Other Supplier Public Use File (PUF) with information on services and procedures provided to Medicare beneficiaries by over 880,000 physicians and other healthcare professionals who received $77 billion in payments in 2012. The PUF contains information on utilization, payment (allowed amount and Medicare payment), and submitted charges organized by National Provider Identifier (NPI), Healthcare Common Procedure Coding System (HCPCS) code, and place of service. This PUF is based on information from CMS’s National Claims History Standard Analytic Files. The data indicate that Medicare paid almost 4,000 doctors and medical professionals more than $1 million apiece in 2012. The data also shows that medical specialties with the highest aggregate Medicare payments were internal medicine, ophthalmology, and cardiology; and the specialties with highest average Medicare-allowed amount per individual on average were hematology/oncology, radiation oncology and ophthalmology. Last week, CMS indicated in a letter to the American Medical Association (AMA) that it would release the data in response to multiple requests for the information under the Freedom of Information Act. In a brief this week responding to the release of information, the AMA stated, “Medicare claims data is complex and can be confusing and the manner in which CMS is broadly releasing physician claims data, without context, can lead to inaccuracies, misinterpretations and false conclusions”. In a CMS blog post on the data release, CMS Principal Deputy Administrator Jonathan Blum said the data will make it possible “…to conduct a wide range of analyses that compare 6,000 different types of services and procedures provided, as well as payments received by individual health care providers”.
• On Friday April 11th, President Barack Obama announced that he accepted the resignation of HHS Secretary Kathleen Sebelius, who has held the post since Obama took office in 2009. Obama also announced the nomination of OMB Director Sylvia Mathews Burwell to replace Sebelius. Speaking at the White House on Friday, Sebelius called her tenure “…the most meaningful work I’ve ever been a part of…the cause of my life”. Last fall many Republicans had called for the resignation of high-ranking HHS officials, including Sebelius, following the botched rollout of HealthCare.gov, the Federally-Facilitated Exchange enrollment website. Sebelius’ resignation comes just after the close of the first open enrollment period for ACA Health Insurance Exchanges, during which time over 7 million Americans signed up for coverage.

This advisory is published by Alston & Bird LLP’s Health Care practice area to provide a summary of significant developments to our clients and friends. It is intended to be informational and does not constitute legal advice regarding any specific situation. This material may also be considered attorney advertising under court rules of certain jurisdictions.