A&B Healthcare Week in Review, April 17, 2015

I. REGULATIONS, NOTICES, & GUIDANCE

• On April 17, 2015, the Centers for Medicare & Medicaid Services (CMS) released a proposed rule entitled “Medicare Program; Hospital Inpatient Prospective Payment Systems for Acute Care Hospitals and the Long-Term Care Hospital Prospective Payment System Policy Changes and Fiscal Year 2016 Rates; Revisions of Quality Reporting Requirements for Specific Providers, including Changes Related to the Electronic Health Record Incentive Program.” CMS is proposing to revise the Medicare hospital inpatient prospective payment systems (IPPS) for operating and capital-related costs of acute care hospitals to implement changes arising from the agency’s continuing experience with these systems for FY 2016. The proposed increase in operating payment rates for general acute care hospitals paid under the IPPS that successfully participate in the Hospital Inpatient Quality Reporting (IQR) Program and are meaningful electronic health record (EHR) users is 1.1 percent. This reflects the projected hospital market basket update of 2.7 percent adjusted by -0.6 percentage point for multi-factor productivity and an additional adjustment of -0.2 percentage point in accordance with the Affordable Care Act (ACA); like last year, the rate is further decreased by a proposed 0.8 percent for a documentation and coding recoupment adjustment required by the American Taxpayer Relief Act of 2012. CMS is also addressing the update of the rate-of-increase limits for certain hospitals excluded from the IPPS that are paid on a reasonable cost basis subject to these limits for FY 2016. CMS also proposes to update the payment policies and the annual payment rates for the Medicare prospective payment system (PPS) for inpatient hospital services provided by long-term care hospitals (LTCHs) for FY 2016. In addition, CMS is proposing to establish new requirements or to revise existing requirements for quality reporting by specific providers (acute care hospitals, PPS-exempt cancer hospitals, and LTCHs) that are participating in Medicare, including related proposals for eligible hospitals and critical access hospitals participating in the Medicare Electronic Health Record (EHR) Incentive Program. CMS also proposes to update policies relating to the Hospital Value-Based Purchasing (VBP) Program, the Hospital Readmissions Reduction Program, and the Hospital-Acquired Condition (HAC) Reduction Program. This proposed rule was filed on April 17th and will be published in the Federal Register on April 30th. Comments on the proposed rule are due June 16, 2015. A CMS fact sheet on the proposed rule may be found here.
• On April 15, 2015, CMS released a proposed rule entitled “Medicare Program; Prospective Payment System and Consolidated Billing for Skilled Nursing Facilities (SNFs) for FY 2016, SNF Value-Based Purchasing Program, SNF Quality Reporting Program, and Staffing Data Collection”. This proposed rule would update the payment rates used under the prospective payment system (PPS) for skilled nursing facilities (SNFs) for fiscal year (FY) 2016. In addition, it includes a proposal to specify a SNF all-cause all-condition hospital readmission measure, as well as a proposal to adopt that measure for a new SNF Value-Based Purchasing (VBP) Program and a discussion of SNF VBP Program policies we are considering for future rulemaking to promote higher quality and more efficient health care for Medicare beneficiaries. Additionally, this proposed rule proposes to implement a new quality reporting program for SNFs as specified in the Improving Medicare Post-Acute Care Transformation Act of 2014 (IMPACT Act). It also would amend the requirements that a long-term care (LTC) facility must meet to qualify to participate as a skilled nursing facility (SNF) in the Medicare program, or a nursing facility (NF) in the Medicaid program. These requirements implement the provision in the Affordable Care Act regarding the submission of staffing information based on payroll data. The proposed rule was filed on April 15th, and will be published in the Federal Register on April 20th. Comments are due June 15, 2015.
• On April 13, 2015, CMS announced that it is expanding coverage in section 210.7 of the Medicare National Coverage Determinations (NCD) Manual. CMS has determined that the evidence is adequate to conclude that screening for HIV infection for all individuals between the ages of 15 and 65 years, as is recommended with a grade of A by the United States Preventive Services Task Force (USPSTF), is reasonable and necessary for the early detection of HIV and is appropriate for individuals entitled to benefits under Part A or enrolled under Part B. The coverage determination memo may be accessed here.
• On April 16, 2015, CMS released a proposed decision memo entitled, “Screening for Cervical Cancer with Human Papillomavirus (HPV) Testing”. CMS proposes that the evidence is sufficient to add Human Papillomavirus (HPV) testing once every five years as an additional preventive service benefit under the Medicare program for asymptomatic beneficiaries aged 30 to 65 years in conjunction with the Pap smear test. CMS will cover screening for cervical cancer with the appropriate U.S. Food and Drug Administration (FDA) approved/cleared laboratory tests, used consistent with FDA approved labeling and in compliance with the Clinical Laboratory Improvement Act (CLIA) regulations. CMS is seeking comments on its proposed decision.
• On April 13, 2015, the FDA announced the availability of the guidance entitled ‘‘Balancing Premarket and Postmarket Data Collection for Devices Subject to Premarket Approval.’’ This guidance clarifies FDA’s current policy on balancing premarket and postmarket data collection during the Agency’s review of premarket approval applications (PMA). Specifically, this guidance outlines how FDA considers the role of postmarket information in determining the appropriate type and amount of data that should be collected in the premarket setting to support premarket approval, while still meeting the statutory standard of safety and effectiveness. FDA believes this guidance will improve patient access to safe and effective medical devices that are important to public health by improving the predictability, consistency, transparency, and efficiency of the premarket process. More information may be found here.
• On April 13, 2015, FDA announced the availability of the guidance entitled ‘‘Expedited Access for Premarket Approval and De Novo Medical Devices Intended for Unmet Medical Need for Life Threatening or Irreversibly Debilitating Diseases or Conditions.’’ This guidance outlines FDA’s new, voluntary program for certain medical devices that demonstrate the potential to address unmet medical needs for life threatening or irreversibly debilitating diseases or conditions and that are subject to premarket approval (PMA) applications or de novo classifications. FDA believes that the Expedited Access Pathway (EAP) program will help patients have more timely access to these medical devices by expediting their development, assessment, and review, while preserving the statutory standard of reasonable assurance of safety and effectiveness for premarket approval, consistent with the Agency’s mission to protect and promote public health. The document also discusses how the EAP program approaches the balance of premarket and post-market data collection and incorporates a benefit-risk framework. The EAP program will become effective April 15, 2015. More information may be found here.
• On April 15, 2015, FDA announced the availability of grant funds for the support of Center for Drug Evaluation and Research (CDER). The goal of the CDER is to support the development of appropriate methodologies to conduct medical product safety surveillance in large electronic databases. Innovations in Medical Evidence Development and Surveillance (IMEDS)-Methods is a program within the Reagan-Udall Foundation that supports FDA’s scientific mission of serving public health needs by initiating and facilitating research into the methods of safety evaluation in large databases. The application due date is June 15, 2015. More information may be found here.
• On April 16, 2015, CMS released a proposed rule entitled “Medicaid Program; Mechanized Claims Processing and Information Retrieval Systems (90/10)”. This proposed rule would extend enhanced funding for Medicaid eligibility systems as part of a state’s mechanized claims processing system, and would update conditions and standards for such systems, including adding to and updating current Medicaid Management Information Systems (MMIS) conditions and standards. These changes would allow states to improve customer service and support the dynamic nature of Medicaid eligibility, enrollment, and delivery systems. Comments on the proposed rule are due June 15, 2015.
• On April 14, 2015, the National Coordinator for Health Information Technology (ONC) announced the availability of $1 million in grant funds to support community projects for the Community Interoperability Health Information Exchange (HIE) Program. The Community Interoperability and HIE program will provide funds to up to ten community organizations, state or local government agencies, or other community groups. Under the new grant program, awardees will demonstrate the use of health IT to the wide range of health providers, including those that are not eligible under the Medicare and Medicaid Electronic Health Record Incentive Programs. These include long-term and post-acute care providers, behavioral health providers, individuals and their caregivers, and other care setting and providers. These additional providers could also be safety net providers, public health, social service, emergency medical services and other key members of the care continuum. The deadline for the submission of applications is 11:59 p.m. EDT on June 15, 2015. The deadline to submit intent to apply notices is May 15, but intent to apply notices are not mandatory. The submission application is available here.
• On April 14, 2015, the CMS Center for Consumer Information & Insurance Oversight (CCIIO) released sub-regulatory guidance entitled “Timing of Submission and Posting of Rate Filing Justifications for the 2015 Filing Year for Single Risk Pool Compliant Coverage Effective on or after January 1, 2016.” This Bulletin provides guidance on the timing of submission and posting of information about rate increases as required by section 2794 of the Public Health Service Act (PHS Act) and regulations at 45 CFR Part 154. Specifically, this Bulletin provides guidance on the timing for health insurance issuers to submit Rate Filing Justifications for proposed rate increases in the individual and small group markets. It also provides guidance on the timing for states with an effective rate review program to provide public access to information regarding proposed rate increases that are subject to review and final rate increases. The timelines specified in this Bulletin apply to rates filed in 2015 (2015 filing year) for single risk pool compliant coverage (including both qualified health plans (QHPs) and non-QHPs) effective on or after January 1, 2016.
• On April 14, 2015, CCIIO released a notice entitled “The Transitional Reinsurance Program’s Contribution Collections for the 2014 Benefit Year”. Section 1341 of the Affordable Care Act established a transitional reinsurance program to help stabilize premiums in the individual market inside and outside of the Marketplaces. As of March 31, 2015, HHS has collected approximately $8.7 billion in reinsurance contributions for the 2014 benefit year. Approximately $1 billion more is scheduled to be remitted on or before November 15, 2015.
• On April 14, 2015, CCIIO released a notice entitled “Transitional Reinsurance Program - Timing of Contributions Refund Requests Due to Annual Enrollment Count Misreporting”. To enable CMS to provide issuers with their calculated 2014 benefit year reinsurance payment amount, for the 2014 benefit year contributing entities must send refund requests resulting from annual enrollment count misreporting to CMS by April 30, 2015 or 90 days from the date of their Form submission, whichever is later. For the 2015 and 2016 benefit years, refund requests resulting from annual enrollment count misreporting must be submitted 90 days from the date of Form submission. These requests and other inquiries regarding the reinsurance contribution submission process should be sent to reinsurancecontributions@cms.hhs.gov.  
• On April 14, 2015, CCIIO released “Key Dates in 2015: QHP Certification in the Federally-Facilitated Marketplaces; Rate Review; Risk Adjustment, Reinsurance, and Risk Corridors”. The document includes key dates in 2015 pertaining to QHP certification, rate review for single risk pool compliant plans; and risk adjustment, reinsurance, and risk corridors for PY 2014.
• On April 16, 2015, the Department of Health and Human Services (HHS), the Department of Labor, and Department of the Treasury released an FAQ regarding ACA implementation. The FAQ document addresses the following questions regarding wellness programs under the statute: 1) What does it mean that a health-contingent wellness program must be “reasonably designed”?; and 2) Is compliance with the Departments’ wellness program regulations determinative of compliance with other laws?
• On April 16, 2015, CCIIO released a Frequently Asked Questions on Health Insurance Market Reforms and Wellness Programs. The questions addressed are as follows: 1) May an issuer limit its offering of a wellness program in connection with a particular health insurance product to only certain employer groups enrolling in that product, such as employers in certain industry classifications?; 2) Do the rating rules of section 2701 of the PHS Act prevent an issuer from offering premium discounts, rebates or other incentives for wellness programs other than those designed to prevent or reduce tobacco use?; and 3) When establishing the index rate and plan-level adjustments under the single risk pool provision, may an issuer take into account the penalties or rewards expected to be provided under a wellness program (whether health-contingent or participatory)?
• On April 17, 2015, CMS updated the Shared Savings Program Fast Facts documents to include information for Accountable Care Organizations (ACOs) that joined the Shared Savings Program in 2015. The Shared Savings Program Fast Facts are an annual collection of data that illustrate facts about the Shared Savings Program ACOs such as where ACOs are located, ACO composition, payment characteristics, beneficiary population demographics, and the risk profile of the ACO beneficiary population. This compilation of information provides an aggregate look at the composition of all ACOs, not specific ACOs. The facts now include information for 404 Shared Savings Program ACOs and 19 Pioneer ACOs, which serve 7.92 million Medicare beneficiaries in 49 states plus Washington, D.C. and Puerto Rico. They may be accessed here (all shared savings program ACOs) and here (all Shared Savings Program and Medicare Pioneer ACOs combined).

Event Notices

• April 20-22, 2015: On April 15, 2015, FDA announced a public workshop entitled ‘‘Drug Transporters in Absorption, Distribution, Metabolism, and Excretion (ADME): From the Bench to the Bedside.’’ The public workshop is an American Association of Pharmaceutical Scientists/International Transporter Consortium (AAPS/ITC) Joint Workshop, cosponsored with AAPS, the American Society for Clinical Pharmacology and Therapeutics, and the European Federation for Pharmaceutical Sciences. The goals of this public workshop are to provide an opportunity for scientists in academia, industry, and regulatory agencies to exchange ideas about the cutting edge science in transporters, and to facilitate and enhance translational applications of new development in transporter research in drug development and regulatory review of new therapeutics. The meeting will take place in Baltimore, Maryland. More information may be found here.

II. CONGRESSIONAL LEGISLATION & COMMITTEE ACTION

U.S. Senate

• On April 14, 2015, the Senate voted 92-8 to pass the Medicare Access and CHIP Reauthorization Act of 2015 without amendments, which permanently replaces the flawed Sustainable Growth Rate (SGR) and extends CHIP through FY2017, among other provisions. The President signed the measure into law on April 16th, thereby preventing Medicare physician’s fees from being slashed by 21 percent, as was scheduled to occur in the absence of Congressional action. Due to the timing of the bill signing, some doctors’ claims will be subject to cuts, and then re-processed at the appropriate rate.
• On April 15, 2015, the Senate Homeland Security and Governmental Affairs Committee convened a hearing entitled “IRS Challenges in Implementing the Affordable Care Act”. More information on the hearing may be found here.

House of Representatives

• On April 15, 2015, the House Energy and Commerce Health Subcommittee convened a hearing entitled “Medicare Post Acute Care [PAC] Delivery and Options to Improve It”. The sole witness for Panel I was Mark Miller, Executive Director of the Medicare Payment Advisory Commission (MedPAC). Witnesses for Panel II included Steven Landers, M.D., M.P.H., President and CEO, Visiting Nurse Association Health Group; Samuel Hammerman, M.D., M.M.M., F.C.C.P., Chief Medical Officer, LTACH Hospital Division, Select Medical Corporation; Melissa Morley, Ph.D., Program Manager, Health Care Financing and Payment, RTI International; and Leonard Russ, Principal Partner, Bayberry Health Care, Chairman of American Health Care Association (AHCA). More information on the hearing may be found here.
• On April 14, 2015, the House Ways and Means Health Subcommittee convened a hearing entitled “Individual and Employer Mandates in the President’s Health Care Law”. Witnesses for the hearing included Douglas Holtz-Eakin, President, American Action Forum; Scott Womack, President, Womack Restaurants; and Sabrina Corlette, Faculty, Georgetown University. More information on the hearing may be found here.
• On April 14th, the House Education and Workforce Subcommittee on Health, Employment, Labor and Pensions Subcommittee convened a hearing entitled “Five Years of Broken Promises: How the President’s Health Care Claw is Affecting America’s Workplaces”. The hearing will take place at 2175 Rayburn House Office Building at 10:00 AM. More information on the hearing may be found here.
• On April 15, 2015, the House Appropriations Subcommittee on Labor, Health and Human Services, Education and Related Agencies held a hearing on the budget for Ebola. Witnesses for the hearing included Nicole Lurie, MD, MSPH, Assistant Secretary for Preparedness and Response, United States Public Health Service, United Sates Department of Health and Human Services (HHS); Thomas R. Frieden, MD, MPH, Director, Centers of Disease Control and Prevention (CDC); Anthony S. Fauci, MD, Director, National Institute of Allergy and Infectious Diseases (NIAID), National Institutes of Health (NIH); Robin Robinson, PhD, Director, Biomedical Advanced Research and Development Authority (BARDA), Deputy Assistant Secretary for Preparedness and Response, HHS. More information on the hearing may be found here.

III. REPORTS, STUDIES, & ANALYSES

• On April 13, 2015, Gallup released the results of a poll which shows that the uninsured rates among U.S. adults declined to 11.9% for the first quarter of 2015, down one percentage point from the previous quarter and 5.2 points since the end of 2013, just before the ACA went into effect. The uninsured rate is now the lowest since Gallup began tracking in 2008. While the uninsured rate has declined across all key demographic groups since the healthcare law fully took effect in January 2014, it has dropped most among lower-income Americans and Hispanics -- the groups most likely to lack insurance. The uninsured rate among Americans earning less than $36,000 in annual household income dropped 8.7 points since the end of 2013, while the rate among Hispanics fell 8.3 points.
• On April 16, 2015, the Kaiser Family Foundation released the results of a study entitled “Coverage of Contraceptive Services: A Review of Health Insurance Plans in Five States”. With the passage of the ACA came the requirement that most private plans provide coverage for women’s preventive health care, including all prescribed FDA-approved contraceptive services and supplies, without cost-sharing. Kaiser Family Foundation (KFF) staff, with the Lewin Group, reviewed the insurance plan coverage policies for 12 prescribed contraceptive methods (excluding oral contraceptives). Information was collected from 20 different insurance carriers in five states (California, Georgia, Michigan, New Jersey, and Texas) about how they are applying reasonable medical management (RMM) techniques in their coverage of women’s contraceptive services. Interviews were conducted with plan officials for nine carriers and reviews of publicly available plan documents on contraceptive coverage policies were conducted for an additional 11 carriers. Results show that while most carriers are complying with the spirit of this requirement, there are exceptions, particularly for certain contraceptive methods such as intrauterine devices and emergency contraceptive pills.
• This week IMS Health released a study entitled “Medicines Use and Spending Shifts: A Review of the Use of Medicines in the U.S. in 2014”. The results of the analysis show that spending on medicines increased 13.1% in 2014, the highest level since 2001 when spending growth reached 17.0%. Of note, the study reports that specialty medicines now account for one-third of spending, driven by a wave of recent innovations in treatment for autoimmune diseases, hepatitis C, and cancer. The report also finds that increasing numbers of launches and growth in spending on specialty products in 2014 were driven by growing R&D focus on specialty medicines over the past decade. In addition, Medicaid was the leading driver of retail prescription growth in the first year of expanded coverage under the ACA.

IV. OTHER HEALTH POLICY NEWS

• On April 16, 2015, CMS announced the first-ever Hospital Compare Star Ratings program. The Hospital Compare star ratings relate to patients’ experience of care at almost 3,500 Medicare-certified acute care hospitals. The ratings are based on data from the Hospital Consumer Assessment of Healthcare Providers and Systems Survey (HCAHPS) measures that are included in Hospital Compare. Consumers will now see 12 HCAHPS Star Ratings on Hospital Compare, one for each of the 11 publicly reported HCAHPS measures, plus a summary star rating that combines or rolls up all the HCAHPS Star Ratings. These star ratings will be updated each quarter. This reflects a wider CMS effort to help consumers compare healthcare options, including Nursing Home Compare, Physician Compare, and Dialysis Facility Compare, all of which incorporate star ratings, as well as Home Health Compare, which will include Star Ratings later this year. “The patient experience Star Ratings will make it easier for consumers to use the information on the Hospital Compare website and spotlight excellence in health care quality,” said Dr. Patrick Conway, Acting Principal Deputy Administrator for CMS and Deputy Administrator for Innovation and Quality. “These star ratings also encourage hospitals and clinicians to strive to continuously improve the patient experience and quality of care delivered to all patients.” More information may be found here.