A&B Healthcare Week in Review, May 22, 2015

I. REGULATIONS, NOTICES, & GUIDANCE

• On May 22, 2015, the Office of Management and Budget (OMB) completed review of a Centers for Medicare and Medicaid Services (CMS) proposed rule entitled “Medicaid Managed Care, CHIP Delivered in Managed Care, and Revisions related to Third Party Liability” (CMS-2390-P). OMB received the rule on March 19th. More information may be found here.
• On May 21, 2015, the Office of Personnel Management (OPM) released a final rule entitled “Federal Employees Health Benefits Program; Subrogation and Reimbursement Recovery”. OPM is issuing a final rule to amend the Federal Employees Health Benefits (FEHB) Program regulations to reaffirm the conditional nature of FEHB Program benefits and benefit payments under the plan’s coverage as subject to a carrier’s entitlement to subrogation and reimbursement recovery, and therefore, that such entitlement falls within the preemptive scope of the FEHA Act. FEHB contracts and brochures must include, and in practice already include, a provision incorporating the carrier’s subrogation and reimbursement rights, and FEHB plan brochures must contain an explanation of the carrier’s subrogation and reimbursement policy. This final rule is effective June 22, 2015
• On May 18, 2015, the Food and Drug Administration (FDA) announced the availability of a draft guidance for industry entitled ‘‘Patient Preference Information—Submission, Review in PMAs, HDE Applications, and De Novo Requests, and Inclusion in Device Labeling.’’ This document provides guidance on collecting and submitting patient preference information that may be used by FDA staff in decision-making relating to premarket approval applications (PMAs), Humanitarian Device Exemption (HDE) applications, and de novo requests. This draft guidance also outlines considerations for including patient preference information in labeling for patients and health care professionals. This draft guidance is not final nor is it in effect at this time. Although you can comment on any guidance at any time (see 21 CFR 10.115(g)(5)), to ensure that the Agency considers your comment on this draft guidance before it begins work on the final version of the guidance, submit either electronic or written comments on the draft guidance by August 17, 2015.
• On May 18, 2015, the FDA announced the availability of draft recommendations for preparing a Study Data Standardization Plan. The Standardization Plan is referenced in the Study Data Technical Conformance Guide. The Guide supplements the guidance for industry ‘‘Providing Regulatory Submissions in Electronic Format—Standardized Study Data’’ and provides specifications, recommendations, and general considerations on submitting standardized study data using FDA-supported data standards. The Guide recommends that, for clinical and nonclinical studies, sponsors include a plan that describes the submission of standardized study data to FDA. The proposed recommendations describe the information that should be included in the Standardization Plan. The proposed recommendations for creating a Standardization Plan are posted on FDA’s Study Data Standards Resources Web page here. Although you can comment on these recommendations at any time, to ensure that the Agency considers your comments, please submit either electronic or written comments by July 2, 2015.
• On May 18, 2015, FDA announced the availability of the draft guidance entitled ‘‘Adaptive Designs for Medical Device Clinical Studies; Draft Guidance for Industry and Food and Drug Administration Staff.’’ This guidance provides sponsors and FDA staff with guidance on how to plan and implement adaptive designs for clinical studies when used in medical device development programs. An adaptive design for a medical device clinical study is defined as a clinical trial design that allows for prospectively planned modifications based on accumulating study data without undermining the trial’s integrity and validity. Adaptive designs, when properly implemented, can reduce resource requirements and/ or increase the chance of study success. This draft guidance is not final nor is it in effect at this time. Although you can comment on any guidance at any time (see 21 CFR 10.115(g)(5)), to ensure that the Agency considers your comment of this draft guidance before it begins work on the final version of the guidance, submit either electronic or written comments on the draft guidance by August 17, 2015.
• On May 20, 2015, FDA announced an opportunity for public comment on a proposed information collection activity entitled “Guidance for Industry on Formal Meetings With Sponsors and Applicants for Prescription Drug User Fee Act Products”. This information collection approval request is for FDA guidance on the procedures for formal meetings between FDA and sponsors or applicants regarding the development and review of PDUFA products. The guidance describes procedures for requesting, scheduling, conducting, and documenting such formal meetings. The guidance provides information on how the Agency will interpret and apply section 119(a) of the Food and Drug Administration Modernization Act (FDAMA), specific PDUFA goals for the management of meetings associated with the review of human drug applications for PDUFA products, and provisions of existing regulations describing certain meetings (§§ 312.47 and 312.82 (21 CFR 312.47 and 312.82)). The guidance describes two collections of information: The submission of a meeting request containing certain information and the submission of an information package in advance of the formal meeting. Agency regulations at §§ 312.47(b)(1)(ii), (b)(1)(iv), and (b)(2) describe information that should be submitted in support of a request for an end-of-phase 2 meeting and a pre-NDA meeting. The information collection provisions of § 312.47 have been approved by OMB control number 0910–0014. However, the guidance provides additional recommendations for submitting information to FDA in support of a meeting request. As a result, FDA is submitting additional estimates for OMB approval. Submit either electronic or written comments on the collection of information by July 20, 2015
• On May 18, 2015, the FDA announced the availability of grant funds for the support of the International Council for Harmonization of Technical Requirements for Pharmaceuticals for Human Use (ICH). The goal of the ICH is to bring together leading global drug regulatory agencies and pharmaceutical manufacturer associations to achieve greater harmonization of technical standards to ensure that safe, effective, and high-quality medicines are developed and registered in the most resource-efficient manner. The application due date is September 30, 2015. The expiration date is October 1, 2015. More information may be found here.
• On May 13, 2015, CMS Center for Consumer Information and Insurance Oversight (CCIIO) released a guidance document entitled “Questions and Answers Regarding Rate Review Requirements”. The document notes that CMS has specified uniform rate review timelines with respect to 2015 rate filings for single risk pool compliant coverage effective on or after January 1, 2016, and specifies that these deadlines do apply in states with a State-Based Marketplace (SBM). However, for 2015 rate filings for coverage effective on or after January 1, 2016 only, CMS will not consider a state with an effective rate review program that operates an SBM and does not utilize the Federally Facilitated Marketplace (FFM) platform (and issuers offering coverage in such state) to be out of compliance with the uniform rate submission, posting, and finalization timeline for single risk pool compliant plans (including both QHPs and non-QHPs) offered in such state as long as the state meets several conditions, which are described in the guidance. States with effective rate review programs that operate an SBM and elect to exercise this flexibility must ensure that the information they release to the public is made available at a uniform time for all proposed and final rate increases for single risk pool compliant coverage (including QHPs and non-QHPs), as applicable, in the relevant market segment and without regard to whether coverage is offered through or outside of an Exchange.

Event Notices

• July 1-2, 2015: FDA’s Center for Drug Evaluation and Research, in collaboration with the National Institutes on Drug Abuse, the Centers for Disease Control and Prevention, the Substance Abuse and Mental Health Services Administration, and the Health Resources and Services Administration, will hold a public meeting to discuss increasing the use of naloxone to reduce the incidence of opioid drug overdose fatalities. During the meeting, academic and government experts, industry representatives, and patient advocates will discuss which populations are at-risk for opioid drug overdose and how we can work together to encourage the use of naloxone to reduce the risk of overdose from opioid drugs. The public meeting will be held on July 1, 2015, from 8 a.m. to 5 p.m. and on July 2, 2015, from 8 a.m. to 3 p.m. The open public hearing will be held between 1 p.m. and 2 p.m. on July 1, 2015, and between 1 p.m. and 2 p.m. on July 2, 2015, during which speaker testimony will be accepted. The public meeting will be held at the FDA White Oak Campus. More information may be found here.

II. CONGRESSIONAL LEGISLATION & COMMITTEE ACTION

U.S. Senate

• In a letter sent May 22nd to health care stakeholders, Finance Committee Chairman Orrin Hatch (R-UT) and Ranking Member Ron Wyden (D-OR) announced the formation of a bipartisan working group in an effort to begin exploring solutions that will improve outcomes for Medicare patients requiring chronic care. The Chairman and Ranking Member announced the initiative following a May 15th Finance hearing on the issue and have appointed committee members Johnny Isakson (R-GA) and Mark Warner (D-VA) to lead the effort, which will include seeking input from health care stakeholders. Submissions can be made at the Senate Finance Committee chronic care reform mailbox at chronic_care@finance.senate.gov. Specifically, the senators are seeking input regarding the following issue areas:1) Improvements to Medicare Advantage for patients living with multiple chronic conditions; 2) Transformative policies that improve outcomes for patients living with chronic diseases either through modifications to the current Medicare Shared Savings ACO Program, piloted alternate payment models (APMs) currently underway at CMS, or by proposing new APM structures; 3) Reforms to Medicare’s current fee-for-service program that incentivize providers to coordinate care for patients living with chronic conditions; 4) The effective use, coordination, and cost of prescription drugs; 5) Ideas to effectively use or improve the use of telehealth and remote monitoring technology; 6) Strategies to increase chronic care coordination in rural and frontier areas; 7) Options for empowering Medicare patients to play a greater role in managing their health and meaningfully engaging with their health care providers; and 8) Ways to more effectively utilize primary care providers and care coordination teams in order to meet the goal of maximizing health care outcomes for Medicare patients living with chronic conditions. The deadline to respond is Monday, June 22, 2015. All submissions will be considered part of the public record.
• On May 20, 2015, the Senate Special Aging Committee convened a hearing entitled “Challenging the Status Quo: Solutions to the Hospital Observation Stay Crisis”. Witnesses for the hearing included Sean Cavanaugh, Deputy Administrator And Director, Centers for Medicare and Medicaid Services (CMS); Mark E. Miller, PhD, Executive Director, Medicare Payment Advisory Commission (MedPAC); Dr. “Jeetu” Nanda, System Medical Director, Informatics And Physician Compliance, SSM Health; Spencer Young, President, Health Data Insights; and Tori Gaetani, Director Of Care Coordination, Population Health, Beacon Health. During the hearing Chairwoman Susan Collins (R-ME) expressed concern regarding the financial implications of outpatient observation status on beneficiaries. She stated that the financial consequences of these stays can be severe, particularly if the patient transitions to skilled nursing facility (SNF) care following the hospital stay. More information on the hearing may be found here.

House of Representatives

• On May 19, 2015, the House Energy and Commerce Committee convened a markup to consider the 21st Century Cures Act. Opening statements were presented. The Committee reconvened the markup on May 21, 2015 to continue consideration of the legislation and amendments offered. Chairman Upton’s Manager’s Amendment was agreed to by voice vote; all other amendments were either not offered in markup or withdrawn. The legislation as amended was passed out of Committee by a vote of 51-0. During the markup Chairman Fred Upton (R-TX) discussed his Manager’s Amendment, saying it reflects improvements to an already bipartisan bill. Changes include additional funding for the FDA, through the creation of an annual Cures Innovation Fund, to fund regulatory modernization activities at FDA including the qualification of biomarkers. The amendment also ensures privately funded user fee payments to FDA no longer face the threat of sequestration and establishes additional FDA hiring authority. The amendment includes ‘common sense reforms’ to fully pay for the cost of the bill. Finally, the amendment includes a provision on Lyme and other tick-borne disease research which is based off legislation that passed the House last year. Rep. Upton noted that he added a number of provisions to his amendment from Rep. Rush which would increase representation of underrepresented communities in clinical trials and the research workforce.
• On May 19, 2015, the House Ways and Means Health Subcommittee convened a hearing entitled “Improving Competition in Medicare: Removing Moratoria and Expanding Access.” Witnesses for the hearing included Joe Antos, Wilson H. Taylor Scholar in Health Care and Retirement Policy, American Enterprise Institute (AEI); Joe Minissale, President, Methodist McKinney Hospital; Robert Steedley, President, Barnes Healthcare Services (Valdosta, GA) on behalf of the American Association for Homecare (AAH); and Rich Umbdenstock, President and CEO, American Hospital Association (AHA). More information on the hearing may be found here.
• On May 20, 2015, the House Ways and Means Subcommittee on Oversight convened a hearing entitled “Examining the Use of Administrative Actions in the Implementation of the Affordable Care Act.” Witnesses for the hearing included Elizabeth Papez, Partner, Winston & Strawn LLP; Jonathan Adler, Professor of Law, Case-Western Reserve University School of Law; Grace-Marie Turner, President, The Galen Institute; and Robert Weiner, Partner, Arnold and Porter LLC. More information on the hearing may be found here.
• On May 21, 2015, the House Energy & Commerce Subcommittee on oversight convened a hearing entitled “What Are the State Governments Doing to Combat the Opioid Abuse Epidemic?” The purpose of this hearing was to confer with a selection of state health officials regarding their ongoing efforts to combat the opioid abuse epidemic and explore how state and federal policies can most effectively incentivize the development and broadened use of evidence-based practices and treatments in their communities. Witnesses for the hearing included Jerome Adams, M.D., M.P.H., Health Commissioner, Indiana State Department of Health; Monica Bharel, M.D., M.P.H. Commissioner, Massachusetts Department of Public Health; Mark Stringer, M.A., L.P.C., N.C.C., Director, Division of Behavioral Health, Missouri, Department of Mental Health; and Larry Wolk, M.D., MSPH, Executive Director and Chief Medical Officer, Colorado Department of Public Health and Environment. More information on the hearing may be found here.

III. REPORTS, STUDIES, & ANALYSES

• On May 20, 2015, the Commonwealth Fund released a report which finds that 31 million individuals were underinsured in 2014. According to the study, 11% of privately insured adults had a deductible of $3,000 or more in 2014, up from 1% in 2003. These estimates are statistically unchanged from 2010 and 2012, but nearly double those found in 2003 when the measure was first introduced in the survey. The share of continuously insured adults with high deductibles has tripled, rising from 3 percent in 2003 to 11 percent in 2014. Half (51%) of underinsured adults reported problems with medical bills or debt and more than two of five (44%) reported not getting needed care because of cost. Among adults who were paying off medical bills, half of underinsured adults and 41 percent of privately insured adults with high deductibles had debt loads of $4,000 or more.
• This week Milliman released a report entitled “2015 Milliman Medical Index”. The Milliman Medical Index (MMI) examines the cost of healthcare under five separate categories of services: inpatient facility care; outpatient facility care; professional services; pharmacy; and other. The report states that last year’s 5.4% growth rate was the lowest in the history of the MMI and stands out compared with ten years ago, when the three-year average annual growth rate was approximately 10%. This year, the growth rate has again climbed, increasing to 6.3% in 2015, largely due to increases in prescription drug costs. Prescription drug costs spiked significantly, growing by 13.6% between 2014 and 2015.
• On May 18, 2015, the HHS Office of Inspector General released a report entitled “U.S. Department of Health and Human Services Met Many Requirements of the Improper Payments Information Act of 2002 but Did Not Fully Comply for Fiscal Year 2014”. OIG finds that in general, the methodologies used by the Department to estimate improper payments were reasonable and valid and resulted in reasonable estimates. The Department also reported information on its efforts to recapture improper payments and the results of those actions. However, the Department did not fully comply with several IPIA requirements in that it: did not perform risk assessments of payments to employees and charge card payments; did not publish an improper payment estimate for one of eight programs that OMB deemed to be susceptible to significant improper payments (Temporary Assistance for Needy Families (TANF)); did not publish corrective action plans for one of the eight programs (TANF) that OMB deemed to be susceptible to significant improper payments; did not meet improper payment rate reduction targets for four of the six programs for which it reported reduction targets in the FY 2013 AFR (Medicare FFS, Medicaid, Foster Care, and Child Care Development Fund); and did not report an improper payment rate of less than 10 percent for one of the eight programs deemed susceptible to improper payments by OMB (Medicare Fee-for-Service) and two of the seven programs deemed susceptible to improper payments under the DRAA (Administration for Children and Families Social Services Block Grant and Substance Abuse and Mental Health Services Administration Grants).

IV. OTHER HEALTH POLICY NEWS

• On May 19, 2015, the Medicare Payment Advisory Commission (MedPAC) sent a letter to CMS Acting Administrator Andy Slavitt in response to the proposed rule entitled “Medicare Program; Prospective Payment System and Consolidated Billing for Skilled Nursing Facilities for FY 2016”, Federal Register, Vol. 80, No. 75, p. 22044 (April 20, 2015). In the letter, MedPAC notes that Medicare’s payments to the SNF sector are estimated to increase $500 million in FY 2016, and encourages CMS not to update SNF payment. “We understand that CMS is required by law to update the SNF prospective payment system (PPS) rates,” the Commission wrote. “However, after reviewing many factors—including indicators of beneficiary access, the volume of services, the supply of providers, and access to capital— the Commission believes no update is warranted.”
• On May 20, 2015, CareFirst BlueCross BlueShield announced that information from about 1.1 million current and former policyholders and others was compromised by a cyber-attack in 2014. The announcement reads: “CareFirst BlueCross BlueShield has confirmed that cyber attackers gained limited, unauthorized access to a CareFirst database. We understand that the security of your information is important and we are taking steps to protect members in light of this attack and moving forward. We are offering two years of free credit monitoring and identity theft protection services for those members affected. If you have been affected, you will receive a letter from CareFirst.”