A&B Healthcare Week in Review, July 10, 2015

I. REGULATIONS, NOTICES, & GUIDANCE

• On July 10, 2015, the Centers for Medicare & Medicaid Services (CMS) released a proposed rule entitled “Medicare and Medicaid Programs; CY 2016 Home Health Prospective Payment System Rate Update; Home Health Value-Based Purchasing Model; and Home Health Quality Reporting Requirements”. This proposed rule would update Home Health Prospective Payment System (HH PPS) rates, including the national, standardized 60- day episode payment rates, the national per-visit rates, and the non-routine medical supply (NRS) conversion factor under the Medicare prospective payment system for home health agencies (HHAs), effective for episodes ending on or after January 1, 2016. As required by the Affordable Care Act (ACA), this proposed rule implements the third year of the four-year phase-in of the rebasing adjustments to the HH PPS payment rates. This proposed rule provides information on CMS’ efforts to monitor the potential impacts of the rebasing adjustments. This proposed rule also proposes: reductions to the national, standardized 60-day episode payment rate in CY 2016 and CY 2017 of 1.72 percent in each year to account for estimated case-mix growth unrelated to increases in patient acuity (nominal case-mix growth) between CY 2012 and CY 2014; a HH value-based purchasing (HHVBP) model to be implemented beginning January 1, 2016 in which all Medicare-certified HHAs in selected states will be required to participate; changes to the home health quality reporting program requirements; and minor technical regulations text changes. Finally, this proposed rule would update the HH PPS case-mix weights using the most current, complete data available at the time of rulemaking and provide an update on the Report to Congress regarding the home health (HH) study. Comments are due September 4, 2015. A CMS press release on the proposed rule may be found here; a Fact Sheet may be found here.
• On July 10, 2015, the Departments of Treasury, Labor, and Health and Human Services (HHS) released a final rule entitled “Coverage of Certain Preventive Services Under the Affordable Care Act”. This document contains final regulations regarding coverage of certain preventive services under section 2713 of the Public Health Service Act (PHS Act), added by the Patient Protection and Affordable Care Act, as amended, and incorporated into the Employee Retirement Income Security Act of 1974 and the Internal Revenue Code. Section 2713 of the PHS Act requires coverage without cost sharing of certain preventive health services by non-grandfathered group health plans and health insurance coverage. These regulations finalize provisions from three rulemaking actions: interim final regulations issued in July 2010 related to coverage of preventive services, interim final regulations issued in August 2014 related to the process an eligible organization uses to provide notice of its religious objection to the coverage of contraceptive services, and proposed regulations issued in August 2014 related to the definition of “eligible organization,” which would expand the set of entities that may avail themselves of an accommodation with respect to the coverage of contraceptive services. The rule will go into effect in 60 days. An HHS news release may be found here.
• On July 8, 2015, CMS released a proposed rule entitled “Medicare Programs: Revisions to Payment Policies under the Physician Fee Schedule and Other Revisions to Part B for CY 2016”. This major proposed rule addresses changes to the physician fee schedule, and other Medicare Part B payment policies to ensure that CMS’ payment systems are updated to reflect changes in medical practice and the relative value of services, as well as changes in the statute. Comments are due September 8, 2015. A CMS Fact Sheet on the proposed rule may be found here.
• On July 9, 2015, CMS released a proposed rule entitled “Medicare Program; Comprehensive Care for Joint Replacement Payment Model for Acute Care Hospitals Furnishing Lower Extremity Joint Replacement Services”. This proposed rule proposes to implement a new Medicare Part A and B payment model under section 1115A of the Social Security Act, called the Comprehensive Care for Joint Replacement (CCJR) model, in which acute care hospitals in certain selected geographic areas will receive retrospective bundled payments for episodes of care for lower extremity joint replacement or reattachment of a lower extremity. All related care within 90 days of hospital discharge from the joint replacement procedures will be included in the episode of care. In its summary of the rule, CMS states: “We believe this model will further our goals in improving the efficiency and quality of care for Medicare beneficiaries for these common medical procedures.” Comments are due September 8, 2015. A CMS press release may be found here; a Fact Sheet on the proposed rule may be found here.
• On July 6, 2015, the Food and Drug Administration (FDA) announced the availability of a guidance for industry entitled ‘‘DSCSA Implementation: Product Tracing Requirements for Dispensers— Compliance Policy.’’ This guidance announces FDA’s intention with regard to enforcement of certain product tracing requirements of the Federal Food, Drug, and Cosmetic Act (FD&C Act) added by the Drug Supply Chain Security Act (DSCSA). FDA does not intend to take action against dispensers who, prior to November 1, 2015, accept ownership of product without receiving product tracing information, prior to or at the time of a transaction or do not capture and maintain the product tracing information, as required by the FD&C Act.
• On July 6, 2015, the Substance Abuse and Mental Health Services Administration (SAMHSA) released a notice entitled, “National Registry of Evidence-based Programs and Practices (NREPP)”. This notice announces the redesign of NREPP to better align the registry with the standards and processes of other evidence-based repositories. A re-launch of the website with revised content is anticipated in late fall/early winter 2015. The notice explains the changes in how programs and practices will be identified for NREPP, how submissions will be screened and reviewed, and provides guidance on accessing updated information on the NREPP site. Potential applicants should be aware that this notice includes updated information relating to the eligibility of interventions for inclusion in NREPP and changes in the program and practice review process that supersedes guidance provided in earlier Federal Register notices.
• On July 7, 2015, CMS announced an opportunity for the public to comment on two information collection activities. The first is entitled “Solicitation for Applications for Medicare Prescription Drug Plan 2017 Contract”. The information will be collected under the solicitation of proposals from prescription drug plans, Medicare Advantage (MA) plans that offer integrated prescription drug and health care coverage (MA–PD) plans, Cost Plan, PACE, and Employer Group Waiver Plan applicants. The second is entitled “Title of Information Collection: Part C— Medicare Advantage and 1876 Cost Plan Expansion Application”. The information will be collected under the solicitation of Part C applications from Medicare Advantage, Employer Group Waiver Plan, and Cost Plan applicants and will be used by CMS to ensure that applicants meet CMS requirements, and to support the determination of contract awards. Comments are due September 8, 2015. More information may be found here.
• On July 7, 2015, FDA announced the availability of a draft guidance for industry entitled ‘‘Qualification of Biomarker—Plasma Fibrinogen in Studies Examining Exacerbations and/or All-Cause Mortality in Patients With Chronic Obstructive Pulmonary Disease.’’ This draft guidance provides a qualified context of use (COU) for plasma fibrinogen in interventional clinical trials of chronic obstructive pulmonary disease (COPD) subjects at high risk for exacerbations and/or all-cause mortality. This draft guidance also describes the experimental conditions and constraints for which this biomarker is qualified through the Center for Drug Evaluation and Research (CDER) Biomarker Qualification Program. This biomarker can be used by drug developers for the qualified COU in submissions of investigational new drug applications (INDs), new drug applications (NDAs), and biologics license applications (BLAs) without the relevant CDER review group reconsidering and reconfirming the suitability of the biomarker. Comments are due September 8, 2015.
• On July 8, 2015, FDA issued a final rule entitled “Permanent Discontinuance or Interruption in Manufacturing of Certain Drug or Biological Products”. FDA is amending its regulations to implement certain drug shortages provisions of the Federal Food, Drug, and Cosmetic Act (the FD&C Act), as amended by the Food and Drug Administration Safety and Innovation Act (FDASIA). The rule requires all applicants of covered approved drugs or biological products— including certain applicants of blood or blood components for transfusion and all manufacturers of covered drugs marketed without an approved application—to notify FDA electronically of a permanent discontinuance or an interruption in manufacturing of the product that is likely to lead to a meaningful disruption in supply (or a significant disruption in supply for blood or blood components) of the product in the United States. The rule is effective September 8, 2015.
• On July 8, 2015, the Office of Personnel Management (OPM) announced a 60-day notice and request for comments entitled “Submission for Review; Health Benefits Election Form, OPM 2809, 3206–0141”. Comments are due September 8, 2015.
• On July 8, 2015, the Department of Veterans Affairs (VA) released a proposed rule entitled “Schedule for Rating Disabilities—The Endocrine System”. VA proposes to revise the portion of the VA Schedule for Rating Disabilities (Rating Schedule) that addresses the endocrine system. The intended effects of these changes are to update medical terminology, add medical conditions not currently in the Rating Schedule, revise the criteria to reflect medical advances since the last revision in 1996, and clarify the criteria. Comments are due September 8, 2015.
• On July 9, 2015, FDA announced the availability of the draft guidance entitled ‘‘Heparin-Containing Medical Devices and Combination Products: Recommendations for Labeling and Safety Testing.’’ This draft guidance describes FDA’s intent to address the safety concerns by clarifying new expectations for labeling with regard to the soon-to-be revised heparin United States Pharmacopeia (USP) monographs as well as outline safety testing recommendations. Comments are due October 7, 2015.
• On July 9, 2015, FDA announced the availability of a guidance for industry entitled “Meetings With the Office of Orphan Products Development; Guidance for Industry, Researchers, Patient Groups, and Food and Drug Administration Staff”. This guidance provides recommendations to industry, researchers, patient groups, and other stakeholders (collectively referred to as ‘‘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 guidance document is intended to assist these groups with requesting, preparing, scheduling, conducting, and documenting meetings with OOPD. This guidance finalizes the draft guidance of the same title dated April 2014.
• On July 10, 2015, the HHS released a notice entitled “Medicare Program; Administrative Law Judge Hearing Program for Medicare Claim and Entitlement Appeals; Quarterly Listing of Program Issuances—March Through June 2015”. This notice announces the implementation of the OMHA Case Processing Manual (OCPM). This manual standardizes the day-to-day procedures for carrying out adjudicative functions, in accordance with applicable statutes, regulations and OMHA directives, and gives OMHA staff direction for processing appeals at the OMHA level of adjudication.

Event Notices

• July 28 & 29, 2015: The Health Resources and Services Administration (HRSA) has announced a meeting of the National Advisory Council on Nurse Education and Practice. The purpose of the 131st National Advisory Council on Nurse Education and Practice (NACNEP) meeting is to provide advice and recommendations on policy and program development related to the role of nursing in Inter-professional Education (IPE) and Practice. The purpose is to discuss existing IPE models in an academic setting and the intersect between education and practice as it relates to Health Care delivery reform. The goal of the meeting is to solicit recommendations for IPE in an academic setting and the intersect important to IPE and practice. Strengths, challenges, achievable solutions, and replicable models required and/or available to move from discussion to action will be identified. Additionally, the meeting will discuss topics for future work of the council. This meeting will conclude with a formulation of recommendations and form the basis for NACNEP’s mandated Thirteenth Annual Report to the Secretary of the U.S. Department of Health and Human Services and Congress. A final agenda will be posted on the NACNEP Web site 3 days prior to the meeting. The meeting will take place July 28th and 29th from 8:30 AM to 5:00 PM via webinar. More information may be found here.

II. CONGRESSIONAL LEGISLATION & COMMITTEE ACTION

U.S. Senate

• On July 6, 2015, the Senate Health, Education, Labor and Pensions (HELP) Committee convened a hearing entitled "Small Business Health Care Challenges and Opportunities." Witnesses included: Thomas Harte, owner of Landmark Benefits; James Scott, owner of Applied Policy; Sabrina Corlette, Senior Research Fellow and Project Director, Georgetown University; and Kelly Conklin, owner of Foley Waite, LLC. More information on the hearing may be found here.
• On July 8, 2015, the Senate Homeland Security & Governmental Affairs Committee convened a hearing entitled “Stopping an Avian Influenza Threat to Animal and Public Health”. Witnesses for the hearing included: John R. Clifford, DVM, Chief Veterinary Officer, U.S. Department of Agriculture; Anne Schuchat, M.D., Director, National Center for Immunization and Respiratory Diseases, Centers for Disease Control and Prevention (CDC) and Assistant Surgeon General, U.S. Public Health Service, U.S. Department of Health and Human Services (HHS); Christopher P. Currie, Director, Homeland Security and Justice, U.S. Government Accountability Office (GAO); Jack Gelb, Jr., Ph.D., Director, Avian Biosciences Center, College of Agriculture and Natural Resources, University of Delaware; and Scott Schneider, Owner, Nature Link Farm, and President, Wisconsin Poultry and Egg Industries Association. More information on the hearing may be found here.

House of Representatives

• On July 10, 2015, the House passed the “21st Century Cures Act” (H.R. 6) as amended by a vote of 344-77. Five amendments were passed; an amendment by Representative Dave Brat (R-VA), which would have made new funding provisions discretionary, instead of mandatory, failed. The measure now heads to the Senate. On July 8th, the White House issued a Statement of Administration Policy on H.R. 6. In the document, the President praises certain aspects of the bill, while expressing concern about the use of oil sales from the Strategic Petroleum Reserve as a source of funding. A Congressional Budget Office (CBO) cost estimate on the measure may be found here.
• On July 8, 2015, the House Energy and Commerce Health Subcommittee convened a hearing entitled “Medicaid at 50: Strengthening and Sustaining the Program.” Witnesses included Vikki Wachino, Deputy Administrator, CMS, and Director, Center for Medicaid and CHIP Services, CMS; Carolyn Yocom, Director, Health Care, Government Accountability Office (GAO); accompanied by Katherine Iritani, Director, Health Care, GAO; and Anne Schwartz, Executive Director, Medicaid and CHIP Payment and Access Commission (MACPAC). More information on the hearing may be found here. During the hearing, Subcommittee Chairman Joe Pitts (R-PA) cautioned that the trajectory of Medicaid spending is problematic, and he noted that program outlays are projected to double in the next decade. “I believe that Congress will be increasingly forced to take steps to modernize the Medicaid program,” he said. Witness Carolyn Yocom, GAO, provided an overview of GAO findings as outlined in a recently-released report entitled “Medicaid: Overview of Key Issues Facing the Program”.
• On July 8, 2015, the House Appropriations Committee approved the fiscal year 2016 Agriculture Appropriations bill by voice vote. The bill provides for approximately $2.6 billion in discretionary funding for the FDA. Total funding for the FDA, including revenue from user fees, is $4.6 billion – $106 million above fiscal year 2015. Within this total, food safety activities are increased by $41.5 million, and medical product safety activities are increased by $4.2 million. More information on the measure may be found here.

III. REPORTS, STUDIES, & ANALYSES

• On July 6, 2015, the Government Accountability Office (GAO) released a report entitled “Medicare Part B Drugs: Action Needed to Reduce Financial Incentives to Prescribe 340B Drugs at Participating Hospitals”. Certain providers, including hospitals that serve a disproportionate number of low-income patients, have access to discounted prices on outpatient drugs through the 340B Drug Pricing Program, which is administered by HRSA. In 2012, these hospitals—referred to as 340B disproportionate share hospitals (DSH) because they are eligible for the program based on their serving a disproportionate share of low-income patients and other specified criteria—were generally larger and more likely to be teaching hospitals compared with non-340B hospitals. GAO found that in both 2008 and 2012, per beneficiary Medicare Part B drug spending, including oncology drug spending, was substantially higher at 340B DSH hospitals than at non-340B hospitals. This indicates that, on average, beneficiaries at 340B DSH hospitals were either prescribed more drugs or more expensive drugs than beneficiaries at the other hospitals in GAO's analysis. The differences did not appear to be explained by the hospital characteristics GAO examined or patients' health status. CMS, which administers the Medicare program, uses a statutorily defined formula to pay hospitals for drugs at set rates regardless of hospitals' costs for acquiring the drugs. “Therefore,” GAO wrote, “there is a financial incentive at hospitals participating in the 340B program to prescribe more drugs or more expensive drugs to Medicare beneficiaries… In addition, this raises potential concerns about the appropriateness of the health care provided to these beneficiaries.” GAO recommended that “Congress should consider eliminating the incentive to prescribe more drugs or more expensive drugs than necessary to treat Medicare Part B beneficiaries at 340B hospitals.”
• This week the Centers for Disease Control and Prevention (CDC) issued an update on the national heroin epidemic. CDC reports that 2002 and 2013, the rate of heroin-related overdose deaths nearly quadrupled, and more than 8,200 people died in 2013. In its report, CDC outlines a number of steps that states and providers can take to address heroin addiction.

IV. OTHER HEALTH POLICY NEWS

• On July 9, 2015, President Obama announced his intent to nominate four individuals to key Administration posts. These include Mary K. Wakefield, who will be nominated as Deputy Secretary of HHS, and Andy Slavitt, who will be nominated as CMS Administrator (Slavitt currently serves as Acting Administrator). The White House announcement on the nominations may be found here.
• On July 8, 2015, the White House issued a set of draft guiding principles related to its “Precision Medicine Initiative”, or PMI, which was launched in January. In a press release, the White House said that these principles, “…will guide the development of a research cohort of one million or more participants who voluntarily contribute their health data to help us answer the many as yet unsolved mysteries of health and disease. These principles are being made available today as a working draft, with the intent of soliciting the broadest possible input and feedback from stakeholders, experts, and the public.”
• On July 6, 2015, CMS and the American Medical Association (AMA) announced efforts to help physicians get ready in advance of the October 1st deadline to transition from ICD-9 to ICD-10 coding for medical diagnoses and inpatient hospital procedures. In a press release, CMS explains, “Recognizing that health care providers need help with the transition, CMS and AMA are working to make sure physicians and other providers are ready ahead of the transition to ICD-10 that will happen on October 1. Reaching out to health care providers all across the country, CMS and AMA will in parallel be educating providers through webinars, on-site training, educational articles and national provider calls to help physicians and other health care providers learn about the updated codes and prepare for the transition.” CMS also detailed its operating plans for the ICD-10 implementation. New CMS guidance on ICD-10 may be found here.