A&B Healthcare Week in Review, September 5, 2014

I. REGULATIONS, NOTICES, & GUIDANCE

• On August 28, 2014, the Centers for Medicare and Medicaid Services (CMS) released a final rule entitled “Medicare and Medicaid Programs; Modifications to the Medicare and Medicaid Electronic Health Record (EHR) Incentive Program for 2014 and Other Changes to the EHR Incentive Program; and Health Information Technology: Revisions to the Certified EHR Technology Definition and EHR Certification Changes Related to Standards”. This final rule changes the meaningful use stage timeline and the definition of certified electronic health record technology (CEHRT) to allow options in the use of CEHRT for the EHR reporting period in 2014. It also sets the requirements for reporting on meaningful use objectives and measures as well as clinical quality measure (CQM) reporting in 2014 for providers who use one of the CEHRT options finalized in this rule for their EHR reporting period in 2014. It addition, it finalizes revisions to the Medicare and Medicaid EHR Incentive Programs to adopt an alternate measure for the Stage 2 meaningful use objective for hospitals to provide structured electronic laboratory results to ambulatory providers; to correct the regulation text for the measures associated with the objective for hospitals to provide patients the ability to view online, download, and transmit information about a hospital admission; and to set a case number threshold exemption for CQM reporting applicable for eligible hospitals and critical access hospitals (CAHs) beginning with FY 2013. Finally, this rule finalizes the provisionally adopted replacement of the Data Element Catalog (DEC) and the Quality Reporting Document Architecture (QRDA) Category III standards with updated versions of these standards. These regulations are effective on October 1, 2014.
• On September 2, 2014, CMS published a final rule entitled “Annual Eligibility Redeterminations for Exchange Participation and Insurance Affordability Programs; etc.”. This final rule specifies additional options for annual eligibility redeterminations and renewal and re-enrollment notice requirements for qualified health plans (QHPs) offered through the Exchanges, beginning with annual redeterminations for coverage for benefit year 2015. This final rule provides additional flexibility for Exchanges, including the ability to propose unique approaches that meet the specific needs of their state, while streamlining the consumer experience. According to a CMS fact sheet on the rule, “As part of the renewal process in the Federally-facilitated Marketplace, generally, if consumers do nothing, they will be auto-enrolled in the same plan with the same premium tax credit and other financial assistance, if applicable, as the 2014 plan year... Consumers whose 2013 tax return indicates that they had very high income, or who did not give the Marketplace permission to check updated tax information for annual eligibility redetermination purposes will get auto-enrolled without financial assistance if they do not return to HealthCare.gov.”
• On August 27, 2014, CMS issued a final notice entitled “Medicare and Medicaid Programs; Renewal of Deeming Authority of the Accreditation Association for National Committee for Quality Assurance (NCQA)”. This final notice announces CMS’ decision to renew the Medicare Advantage “deeming authority” of the National Committee for Quality Assurance (NCQA) for a period of 6 years. This new term of approval would begin October 19, 2014 and end October 18, 2020.
• On August 27, 2014, the Food and Drug Administration (FDA) submitted the following collection of information to OMB for review and clearance: “Guidance for Industry on Registration of Human Drug Compounding Outsourcing Facilities Under Section 503B of the Federal Food, Drug, and Cosmetic Act”. The guidance is being issued to implement provisions added to the Federal Food, Drug, and Cosmetic Act (the FD Act) by the Drug Quality and Security Act (DQSA), which created a statutory category of “outsourcing facilities” that compound human drugs. Section 503B of the FD Act (21 U.S.C. 353b) allows compounders to register with FDA as outsourcing facilities. Drug products compounded in an outsourcing facility can qualify for exemptions from the FDA approval requirements in section 505 of the FD Act (21 U.S.C. 355) and the requirement to label products with adequate directions for use under section 502(f)(1) of the FD Act (21 U.S.C. 352(f)(1)) if the requirements in section 503B are met. The guidance discusses the process for registration of outsourcing facilities. Comments are due September 26, 2014.
• On August 27, 2014, FDA announced the availability of a draft guidance for industry entitled “Controlled Correspondence Related to Generic Drug Development.” The guidance document provides information regarding the process by which human generic drug manufacturers and related industry can submit correspondence to FDA requesting information on generic drug development. This guidance also describes FDA's process for providing communications related to such correspondence. Comments are due October 27, 2014. More information may be found here.
• On August 27, 2014, FDA announced the availability of guidance entitled “Highly Multiplexed Microbiological/Medical Countermeasure In Vitro Nucleic Acid Based Diagnostic Devices.” This guidance is to provide industry and Agency staff with recommendations for studies to establish the analytical and clinical performance of highly multiplexed microbiological/medical countermeasure in vitro nucleic acid-based diagnostic devices (HMMDs) intended to simultaneously detect and identify multiple pathogen nucleic acids extracted from a single appropriate human specimen or culture. More information may be found here.
• On August 27, 2014, FDA announced the fee rates for using a tropical disease priority review voucher for fiscal year (FY) 2015. The Federal Food, Drug, and Cosmetic Act (the FD&C Act), as amended by the Food and Drug Administration Amendments Act of 2007 (FDAAA), authorizes FDA to determine and collect priority review user fees for certain applications for approval of drug or biological products when those applications use a tropical disease priority review voucher awarded by the Secretary of Health and Human Services (HHS). These vouchers are awarded to the sponsors of certain tropical disease product applications, submitted after September 27, 2007, upon FDA approval of such applications. The amount of the fee submitted to FDA with applications using a tropical disease priority review voucher is determined each FY based on the average cost incurred by FDA in the review of a human drug application subject to priority review in the previous FY. This notice establishes the tropical disease priority review fee rate for FY 2015.
• On August 25, 2014, CMS announced that it has submitted the following information collection activities to the Office of Management and Budget (OMB) for review: 1) Request for Certification in the Medicare and/or Medicaid Program to Provide Outpatient Physical Therapy and/or Speech Pathology Services, and (CMS-1893) Outpatient Physical Therapy—Speech Pathology Survey Report; and 2) Reporting Requirements for Grants to States for Rate Review Cycle I, Cycle II, Cycle III, and Cycle IV and Effective Rate Review Program. Comments are due September 24, 2014. More information may be found here.
• On August 26, 2014, CMS announced that it has submitted the following information collection activities to OMB for review: 1) Withholding Medicare Payments to Recover Medicaid Overpayments and Supporting Regulations in 42 CFR 447.31; 2) Limitations on Provider Related Donations and Health Care Related Taxes; 3) Identification of Extension Units of Medicare Approved Outpatient Physical Therapy/Outpatient Speech Pathology (OPT/OSP) Providers and Supporting Regulations; and 4) Payment Collection Operations Contingency Plan Under sections 1401, 1411, and 1412 of the Affordable Care Act and 45 CFR part 155 subpart D. Comments are due September 25, 2014. More information may be found here.
• On August 28, 2014, the National Institutes of Health (NIH) announced the final Genomic Data Sharing (GDS) Policy that promotes sharing, for research purposes, of large-scale human and non-human genomic1data generated from NIH-funded research. A summary of public comments on the draft GDS Policy and the NIH responses are also provided.
• On August 29, 2014, CMS announced that it submitted the following information collection request to OMB for emergency review: “Medicare and Medicaid Programs OASIS Collection Requirements as Part of the CoPs for HHAs and Supporting Regulations”. Comments must be received by September 12, 2014.
• On August 29, 2014, CMS announced that it submitted the following information collection activities to OMB for review: 1) Medicare Prescription Drug Coverage and Your Rights; 2) Skilled Nursing Facility and Skilled Nursing Facility Health Care Complex Cost Report; 3) Independent Renal Dialysis Facility Cost Report and Supporting Regulations; 4) Medicare Authorization to Disclose Personal Health Information; and 5) National Implementation of the Hospice Experience of Care Survey (CAHPs Hospice Survey). Comments are due September 29, 2014. More information may be found here.
• On August 29, 2014, FDA announced the availability of a draft document entitled “Guidance for Industry: Electronic Submission of Lot Distribution Reports”. The draft guidance document provides information and recommendations pertaining to the electronic submission of lot distribution reports for applicants with approved biologics license applications (BLAs). FDA recently published in the Federal Register a final rule requiring that, among other things, lot distribution reports be submitted to FDA in an electronic format that the Agency can process, review, and archive. The draft guidance, when finalized, is intended to help licensed manufacturers of products distributed under approved BLAs (henceforth referred to as applicants) comply with the final rule. Comments are due November 28, 2014. More information may be found here.
• On September 2, 2014, FDA announced that a proposed information collection entitled “Guidance for Industry on Fees for Human Drug Compounding Outsourcing Facilities Under the Federal Food, Drug, and Cosmetic Act” had been submitted to OMB for review and clearance. Comments are due October 2, 2014.
• On September 4, 2014, FDA announced that the Agency is establishing a public docket to discuss issues related to developing drugs for Duchenne muscular dystrophy (DMD). During a public-private policy forum for DMD on December 12, 2013, FDA agreed that Parent Project Muscular Dystrophy (PPMD) and other interested parties in the DMD community could submit for FDA consideration a proposal for a draft guidance for industry on developing drugs for DMD. That proposed draft guidance was submitted to FDA on June 25, 2014. FDA values the guidance provided by the DMD community and is posting the document to seek additional guidance and public comment. More information may be found here.
• On September 5, 2014, CMS announced that the following information collection activities had been submitted to OMB for review: 1) Fast Track Appeals Notices: NOMNC/DENC; 2) Medicare Prescription Drug Coverage and Your Rights; 3) Data Use Agreement (DUA) Certificate of Disposition (COD) for Data Acquired from the Centers for Medicare & Medicaid Services; 4) Collection of Encounter Data from Medicare Advantage Organizations, Section 1876 Cost HMOS/CMPS, Section 1833 Health Care Prepayment Plans (HCPPS), and Pace Organizations; 5) Data Use Agreement (DUA) Certificate of Disposition for Data Acquired from the Centers for Medicare & Medicaid Services (CMS); 6) Survey Tool for www.medicare.gov and www.cms.hhs.gov; and 7) Physician Quality Reporting System (PQRS) and the Electronic Prescribing Incentive (eRx) Program Data Assessment, Accuracy and Improper Payments Identification Support. Comments are due October 6, 2014. More information may be found here.
• On September 5, 2014, CMS announced an opportunity for the public to comment on the following information collection activities: 1) Consumer Operated and Oriented (CO-OP) Program; 2) Payments for Services Furnished by Certain Primary Care Providers and Supporting Regulations in 42 CFR 438.804, 447.400, and 447.410; 3) Risk Corridors Transitional Policy; and 4) Application to Be a Qualified Entity to Receive Medicare Data for Performance Measurement. Comments are due November 4, 2014. More information may be found here.
• On September 5, 2014, CMS released a Notice of Computer Matching Program (CMP), to be published in the Federal Register on September 8, 2014. The purpose of this matching program is to reduce improper payments by authorizing Fiscal Service to provide CMS, through the U.S. Department of the Treasury’s Working System as defined by OMB Memorandum M-13-20 (Protecting Privacy while Reducing Improper Payments with the Do Not Pay Initiative), identifying information from Fiscal Service’s SOR Treasury/Fiscal Service .023 about individuals and entities excluded from receiving federal payments, contract awards, and other benefits. The information resulting from this matching program will be provided to CMS for use in determining whether an individual or entity is eligible to receive federal payments, contract awards, or other benefits. The CMS Center for Program Integrity intends to use information resulting from this matching program in a variety of activities related to the enrollment of healthcare professionals, to check payments made to providers and physicians, to verify that providers submitting claims are not deceased, and to collect debts owed to federal or state governments.

Event Notices

• September 12, 2014: The Health Resources and Services Administration (HRSA) will host a meeting of the Council on Graduate Medical Education (COGME) on September 12th from 9:00 AM to 3:00 PM via webinar and conference call. The COGME provides advice and recommendations to the Secretary of the Department of Health and Human Services and to Congress on a range of issues including the supply and distribution of physicians in the United States, current and future physician shortages or excesses, issues relating to foreign medical school graduates, the nature and financing of medical education training, and the development of performance measures and longitudinal evaluation of medical education programs. This webinar meeting will begin with opening remarks from HRSA senior officials and include a vote on the Council's next Vice Chair. The meeting will also include discussion on the Council's 22nd Report to Congress as well as a brief update by the Designated Federal Official on the Council's current status. More information may be found here.
• September 23-24, 2014: On September 23rd and 24th, the ICD-10 Coordination and Maintenance (C&M) Committee will hold a meeting at the CMS Auditorium in Baltimore, Maryland. The ICD-10 Coordination and Maintenance (C&M) Committee is a public forum for the presentation of proposed modifications to the International Classification of Diseases, Tenth Revision, Clinical Modification and ICD-10 Procedure Coding System. Attendees who wish to attend the September 23-24, 2014, ICD-10 C&M meeting must submit their name and organization by September 12, 2014, for inclusion on the visitor list. More information may be found here.
• September 29-30, 2014: The National Institutes of Health (NIH) announced a public workshop entitled, “Pathways to Prevention Workshop: The Role of Opioids in the Treatment of Chronic Pain,” which will be held on September 29-30th beginning at 8:30 a.m. on both days at the NIH Natcher Conference Center, 45 Center Drive, Bethesda, Maryland 20892. At the workshop, participants will seek to clarify: (1) the long-term effectiveness of opioids for treating chronic pain; (2) the potential risks of opioid treatment in various patient populations; (3) the effects of different opioid management strategies on outcomes related to addiction, abuse, misuse, pain, and quality of life; (4) the effectiveness of risk mitigation strategies for opioid treatment; and (5) the future research needs and priorities to improve the treatment of pain with opioids. More information about this event may be found here.

II. LEGISLATION & COMMITTEE ACTION

U.S. Senate

• The Senate is in the final week of summer recess and will reconvene for regular legislative business on Monday September 8th. More information about the Senate Floor Schedule may be found here.

House of Representatives

• The House is in the final week of summer recess and will reconvene for regular legislative business on Monday September 8th. More information about the House Floor Schedule may be found here.
• On August 26, 2014, members of the Congressional Seniors Task Force, led by Representatives Doris Matsui (D-CA) and Jan Schakowsky (D-IL), sent a letter to CMS Administrator Marilyn Tavenner urging CMS to fully implement the provision of the ACA (sections 6103 and 6106) which requires nursing home staffing information be obtained through a payroll data collection system. Currently, staffing information is self-reported annually, which the lawmakers allege creates “instances where consumers have inaccurate or misleading information”. The letter was also signed by Representatives Lois Frankel (D-FL), Marcy Kaptur (D-OH), Paul Tonko (D-NY), and Charles Rangel (D-NY).

III. REPORTS, STUDIES, & ANALYSES

• On August 26, 2014, the Office of Inspector General (OIG) released a report entitled “An Overview of 60 Contracts That Contributed to the Development and Operation of the Federal Marketplace”. This report is the first in a series that will address the planning, acquisition, management, and performance oversight of Affordable Care Act (ACA) Federal Marketplace contracts, as well as various aspects of Federal Marketplace operations. The document provides descriptive and financial data on 60 contracts related to the development of the Federal Marketplace at HealthCare.gov. Of the 60 contracts, OIG found that the original estimated value totaled $1.7 billion, ranging from $69,195 to over $200 million. Across the 60 contracts, OIG reports, nearly $800 million has been obligated for the development of the Federal Marketplace as of February 2014. As of that date, CMS had paid nearly $500 million for the development of the Federal Marketplace to the contractors awarded these contracts. For 20 of the 60 contracts, they found, the amounts obligated through February 2014 already exceeded the estimated value of the contracts at award. For seven of these contracts, the obligated amounts exceeded the expected value by more than 100 percent.
• On August 26, 2014, HealthPocket released a research brief which suggests that for individuals using specialty drugs, platinum plans available on the Health Insurance Exchanges may be of highest value. Using rate filing data for 2015 ACA individual market plans, HealthPocket estimated out-of-pocket costs for consumers taking five common specialty drugs (Humira, Copaxone, Gleevec, Atripla, and Norditropin used to treat inflammation, multiple sclerosis, cancer, HIV, and growth deficiency respectively). Among the metal plans, platinum plans incurred by far the lowest average out-of-pocket costs for the five common specialty drugs. Out-of-pocket specialty drug costs for platinum plans were 64% lower than gold plans, 74% lower than silver plans, and 78% lower than bronze plans. In every bronze plan examined, the three most expensive drugs (Gleevec, Copaxone, and Norditropin) each incurred annual out-of-pocket costs that reached the plan’s out-of-pocket limit.
• On September 3, 2014, the Pew Charitable Trusts released a report entitled “Medical Device Registries: Recommendations for Advancing Safety and Public Health”. In 2012, FDA issued a report, “Strengthening Our National System for Medical Device Postmarket Surveillance,” outlining four key steps for creating a national surveillance system that would quickly identify poorly performing medical devices. One step was to encourage the development of national and international device registries, which contain information on patients who use or are treated with a specific device. In response to FDA’s report, The Pew Charitable Trusts, the Blue Cross Blue Shield Association, and the Medical Device Epidemiological Network (MDEpiNet) Science Infrastructure Center at Weill Cornell Medical College partnered to develop a set of recommendations—which emerged from several multistakeholder convenings of practitioners, regulators, payers, patients, and industry—on the use of registries to improve patient safety. The report outlines five objectives for stakeholders to work toward so that medical device registries can better contribute to the national surveillance system.
• On September 3, 2014, PricewaterhouseCoopers (PwC) released a research brief entitled “The Health System Haves and Have Nots of ACA Expansion”. The brief describes the impact on the health system of the health law’s option for states to expand their Medicaid programs. According to the findings, Medicaid expansion under the ACA has delivered higher volumes and increased revenue to providers across the 26 states and the District of Columbia that expanded the program, while dramatically reducing the amount of care that goes unpaid. Hospitals in states that did not expand Medicaid have seen the opposite. “[I] non-expansion states,” the brief states, “lower-income individuals may continue to have limited access to care and strain the safety net”.
• On September 3, 2014, an article published online in Health Affairs suggests that between 2013 and 2023, health spending growth will increase as a result of the ACA’s coverage expansions, faster economic growth, and population aging (5.6 percent in 2014 and 6.0 percent per year for 2015–23). However, the average rate of increase through 2023 is projected to be slower than the 7.2 percent average growth experienced during 1990–2008. Because health spending is projected to grow 1.1 percentage points faster than the average economic growth during 2013–23, the health share of the gross domestic product is expected to rise from 17.2 percent in 2012 to 19.3 percent in 2023. The same day, CMS released a press release on the findings, available here.
• On September 5, 2014, the Kaiser Family Foundation released an analysis of 2015 premium changes in the ACA Health Insurance Marketplaces. The analysis examines premium changes for the lowest-cost bronze plan and the two lowest-cost silver plans in 16 major cities. The second-lowest cost silver plan in each state is of particular interest as it acts as a benchmark that helps determine how much assistance eligible individuals can receive in the form of federal tax credits. The findings show that in general, individuals will pay slightly less to enroll in the second-lowest cost plan in 2015 than they did in 2014, prior to the application of tax credits. Although premium changes vary substantially across and within states, the report states, premium changes for 2015 in general are modest when looking at the low-cost insurers in the marketplaces, where enrollment is concentrated.

IV. OTHER HEALTH POLICY NEWS

• On August 26, 2014, HHS and CMS announced new management hires ahead of the 2015 Open Enrollment season for the ACA Marketplaces. The Department announced that Kevin Counihan will join the CMS team as Marketplace Chief Executive Officer (CEO), and Lori Lodes has been named the new Director of Communications for CMS. In his role as Marketplace CEO, Counihan will be responsible and accountable for leading the Federal Marketplace, managing relationships with State Marketplaces, and running the Center for Consumer Information and Insurance Oversight (CCIIO), which regulates health insurance at the federal level. He will report to CMS Administrator Marilyn Tavenner. Counihan most recently served as Connecticut’s Health Insurance Exchange CEO. “When I arrived at the Department, I committed to retain, develop and recruit the best talent available, and that’s what we are doing,” HHS Secretary Sylvia Mathews Burwell said of the announcement. “We are building strong teams with the focus and know-how necessary to advance our mission and deliver impact for the people we serve…I’m particularly pleased to welcome Kevin Counihan to the new Marketplace CEO role. He brings additional operational and technological expertise to the position and will be a clear, single point of contact for streamlined decision-making.”
• On August 28, 2014, CMS announced that the Open Payments reporting system would be inaccessible on both Saturday August 30th and Saturday September 5th. To allow time in the review, dispute and correction processes, CMS is extending the deadlines for review and dispute, and correction. The revised timeline is: Review and dispute (45 days): 7/14/2014 – 8/3/2014, 8/14/2014 – 9/10/2014; Correction period (15 days): 9/11/2014 – 9/25/2014. The date for data publication remains the same, September 30, 2014.
• On August 28, 2014, HHS approved terms and conditions for Pennsylvania’s Medicaid expansion alternative under Republican Governor Tom Corbett, entitled “Healthy Pennsylvania”. CMS has stated that the program will be conducted as a demonstration. With the decision Pennsylvania becomes the 28th state, including the District of Columbia, to expand Medicaid under the ACA.
• On August 28, 2014, the Medicare Payment Advisory Commission (MedPAC) issued a letter to CMS Administrator Marilyn Tavenner commenting on the CMS proposed rule entitled “Medicare Program; Revisions to Payment Policies under the Physician Fee Schedule, Clinical Laboratory Fee Schedule, Access to Identifiable Data for the Center for Medicare and Medicaid Innovation Models & Other Revisions to Part B for CY 2015,” published in the Federal Register, vol. 79, no. 133, pages 40318 to 40540. The comments address the following provisions in the proposed rule: Resource-based practice expense relative value units; potentially misvalued services under the physician fee schedule; valuing new, revised, and potentially misvalued codes; reports of payments or other transfers of value to covered recipients; chronic care management services; physician quality reporting system and value-based payment modifier; and quality measurement for accountable care organizations (ACOs) under the Medicare Shared Savings Program.
• On August 29, 2014, CMS announced that it is now offering an “administrative agreement” to any hospital willing to withdraw their pending Medicare claim appeals in exchange for timely partial payment (68% of the net allowable amount).
• On September 2, 2014, HHS announced that it has awarded $65 million in Healthy Start grants to reduce infant mortality. Healthy Start is targeted to the needs of vulnerable mothers and infants in areas of the country with disproportionately high rates of infant mortality. Twenty-two of these awardees serve rural communities, four will serve the United States-Mexico border, and three programs will serve a predominately Native American population. The list of awardees may be accessed here.
• On September 4, 2014, CMS announced the availability of a Special Enrollment Period (SEP) for former enrollees in Wisconsin’s Medicaid program “BadgerCare”, following a change in the state’s Medicaid eligibility earlier this year. Individuals eligible for this SEP will be able to apply for Marketplace coverage immediately and will have 60 days to do so. “We are working to ensure people affected by the State’s change in Medicaid have the opportunity to enroll in Marketplace coverage,” said CMS Administrator Marilyn Tavenner. “Coverage options are now available to the limited number of people who are no longer eligible for BadgerCare, after the State made changes to its Medicaid program”.
• On September 5, 2014, HHS announced that in late October, small employers, agents and brokers in Delaware, Illinois, New Jersey, Ohio, and Missouri, will have early access to some online functions of the Small Business Health Options Program (SHOP) Marketplace, which launches nationwide on November 15, 2014. During the “SHOP Early Access,” small employers in the five selected states will be able to use HealthCare.gov to take several initial steps in the enrollment process: establishing a Marketplace SHOP account, assigning an agent or broker to their account; completing an employer eligibility application; obtaining an eligibility determination, and uploading an employee roster.
• This week CMS announced that a portion of HealthCare.gov was breached in July. Officials note, however, that no data was stolen and no personal information was compromised. An HHS spokesman asserted that the Department has taken measures in response to further strengthen website security.

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.