A&B Healthcare Week In Review, August 28, 2015

I. REGULATIONS, NOTICES, & GUIDANCE

• On August 28, 2015, the Food and Drug Administration (FDA) announced the availability of a draft guidance for industry entitled ‘‘Nonproprietary Naming of Biological Products.’’ The draft guidance describes FDA’s current thinking on the need for biological products licensed under the Public Health Service Act (PHS Act) to bear a nonproprietary name that includes an FDA-designated suffix. The Agency’s current thinking is that shared nonproprietary names are not appropriate for all biological products. There is a need to clearly identify biological products to improve pharmacovigilance, and, for the purposes of safe use, to clearly differentiate among biological products that have not been determined to be interchangeable. Accordingly, for biological products, FDA intends to designate a nonproprietary name that includes a suffix composed of four lowercase letters. Each suffix will be incorporated in the nonproprietary name of the product. This naming convention is applicable to biological products previously licensed and newly licensed under the PHS Act. The nonproprietary name designated for originator biological products, related biological products, and biosimilars will include a unique suffix. However, FDA is considering whether the nonproprietary name for an interchangeable product should include a unique suffix, or should share the same suffix as its reference product. FDA invites comment on the draft guidance and solicits comments on ways to improve active pharmacovigilance systems for the purposes of monitoring the safety of biological products. Submit either electronic or written comments on the collection of information by October 27, 2015.
• On August 28, 2015, FDA announced that the Agency is proposing a regulation, entitled “Designation of Official Names and Proper Names for Certain Biological Products”, to designate official names and proper names for certain biological products. These products are filgrastimsndz (Biologics License Application (BLA) 125553), filgrastim (BLA 103353), tbo-filgrastim (BLA 125294), pegfilgrastim (BLA 125031), epoetin alfa (BLA 103234), and infliximab (BLA 103772). The official names and proper names of these products would include distinguishing suffixes composed of four lowercase letters and would be designated as filgrastim-bflm (BLA 125553), filgrastim-jcwp (BLA 103353), filgrastim-vkzt (BLA 125294), pegfilgrastim-ljfd (BLA 125031), epoetin alfa-cgkn (BLA 103234), and infliximabhjmt (BLA 103772). Although FDA is continuing to consider the appropriate naming convention for biological products, including how such a convention would be applied retrospectively to currently licensed products, FDA is proposing to take action with respect to these six products because of the need to encourage routine usage of designated suffixes in ordering, prescribing, dispensing, recordkeeping, and pharmacovigilance practices for the biological products subject to this rulemaking, and to avoid inaccurate perceptions of the safety and effectiveness of biological products based on their licensure pathway. Submit either electronic or written comments on the proposed rule by November 12, 2015.
• On August 28, 2015, the Health Resources and Services Administration (HRSA) released a notice entitled “340B Drug Pricing Program Omnibus Guidance”. HRSA administers section 340B of the Public Health Service Act (PHSA), which is referred to as the ‘‘340B Drug Pricing Program’’ or the ‘‘340B Program.’’ This notice proposes guidance for covered entities enrolled in the 340B Program and drug manufacturers that are required by section 340B of the PHSA to make their drugs available to covered entities under the 340B Program. When finalized after consideration of public comments solicited by this notice, the guidance is intended to assist 340B covered entities and drug manufacturers in complying with the statute. Submit comments on or before October 27, 2015.
• On August 25, 2015, the Centers for Medicare & Medicaid Services (CMS) released a document entitled “Guidance for Issuers on 2016 Reenrollment in the Federally-facilitated Marketplace (FFM)”. This bulletin provides guidance on the reenrollment process for 2016 Health Insurance Marketplace (Marketplace) coverage for issuers in Federally-facilitated Marketplaces (FFMs). Specifically, this bulletin will replace “Bulletin #14: Guidance for Issuers on 2015 Reenrollment in the FFM,” released on December 1, 2014, and highlight changes in the 2016 reenrollment process for FFMs. While much of the redetermination and reenrollment process remains unchanged for the Annual Open Enrollment Period (OEP) for 2016, important changes include: (1) establishing eligibility for 2016 advance payments of the premium tax credit (APTC) and income-based cost-sharing reductions (CSRs) using the most recent family income data available and updated 2016 Qualified Health Plan (QHP) prices (in contrast to the 2015 plan year, when 2014 APTC and CSRs were generally carried forward); (2) discontinuing APTC and income-based CSRs for enrollees who do not comply with the requirement to file a tax return and reconcile APTC for tax year 2014; (3) sending the first group of passive reenrollment transactions to issuers before the start of 2016 OEP; and (4) maintaining 2015 enrollees’ effectuation status in 2016 passive reenrollment transactions.
• On August 28, 2015, CMS issued a notice entitled “Medicare Program; Solicitation of Nominations to the Advisory Panel on Hospital Outpatient Payment”. This notice solicits nominations for up to seven new members to the Advisory Panel on Hospital Outpatient Payment (HOP, the Panel). There will be vacancies on the Panel for four-year terms that begin during Calendar Year 2016. The purpose of the Panel is to advise the Secretary of the Department of Health and Human Services (HHS) and the Administrator of the Centers for Medicare & Medicaid Services on the clinical integrity of the Ambulatory Payment Classification groups and their associated weights, and supervision of hospital outpatient therapeutic services. The Secretary re-chartered the Panel in 2014 for a 2-year period effective through November 6, 2016. Nominations should be submitted by October 27, 2015.
• On August 27, 2015, FDA announced the availability of a document entitled ‘‘Design and Analysis of Shedding Studies for Virus or Bacteria-Based Gene Therapy and Oncolytic Products; Guidance for Industry.’’ The guidance document provides sponsors of virus or bacteria-based gene therapy products (VBGT products) and oncolytic viruses or bacteria (oncolytic products) with recommendations on how to conduct shedding studies during preclinical and clinical development. The guidance announced in this notice finalizes the draft guidance of the same title dated July 2014.
• On August 26, 2015, FDA announced that the Agency is extending the comment period for the notice of draft guidance availability and public meeting that appeared in the Federal Register of July 28, 2015, and August 7, 2015 (Request for Quality Metrics; Notice of Draft Guidance Availability and Public Meeting). In the notice of draft guidance availability and public meeting, FDA requested comments on a number of specific questions identified in the document. The Agency is taking this action in response to requests for an extension to allow interested persons additional time to submit comments. FDA is extending the comment period on the notice of draft guidance availability and public meeting published July 28, 2015 (80 FR 44973) and August 7, 2015 (80 FR 47493). Submit either electronic or written comments by November 27, 2015.
• On August 26, 2015, the Department of Defense released a notice entitled “TRICARE; Fiscal Year 2016 Continued Health Care Benefit Program Premium Update”. The Defense Health Agency has updated the quarterly premiums for Fiscal Year 2016 as shown below:
  
  Quarterly CHCBP Premiums for Fiscal Year 2016 Individual $1,300 Family $2,925.
  
  The above premiums are effective for services rendered on or after October 1, 2015.
• On August 25, 2015, the FDA announced the availability of the report and Web site location where the Agency has posted the report entitled ‘‘Recommendations for a National Medical Device Evaluation System: Strategically Coordinated Registry Networks to Bridge the Clinical Care and Research,’’ developed by the Medical Device Epidemiology Network’s Medical Device Registry Task Force. In addition, FDA has established a docket where stakeholders may provide comments. Comments should be submitted by October 26, 2015. More information may be found here.
• On August 24, 2015, the FDA published a notice that an applicant for a proposed biosimilar product notified FDA that a patent infringement action was filed in connection with the applicant’s biologics license application (BLA). Under the Public Health Service Act (PHS Act), an applicant for a proposed biosimilar product or interchangeable product must notify FDA within 30 days after the applicant was served with a complaint in a patent infringement action described under the PHS Act.
• On August 27, 2015, CMS announced that it is requesting an emergency review of the information collection activity entitled “Standards Related to Reinsurance, Risk Corridors, and Risk Adjustment”. Based on CMS’s identification of more significant data discrepancies than previously anticipated, the agency is requesting an emergency revision to the risk corridors data validation information collection requirement. CMS is requiring all companies with QHP issuers to complete a checklist to attest that their submission complied with critical guidelines for risk corridors and MLR data submission. For companies with issuers whose reported claims or premium amounts for risk corridors and MLR differ from data collected for other premium stabilization programs by a greater magnitude than expected, CMS is requiring that issuers quantify these differences, and provide a written explanation of the magnitude of the discrepancy. CMS requires these descriptions to be approved by an actuary. The MLR Risk Corridors Submission Checklist and the Risk Corridors Data Discrepancy Worksheet will be submitted via web form at the company level, such that a company will submit one checklist and one discrepancy worksheet that includes information for all of its applicable issuers. As a result of this new requirement, CMS is updating its annual burden hour estimates to reflect the actual numbers of risk corridors submissions received by QHP issuers and the increased annual burden hours associated with submitting additional data validation information to CMS. Comments are due by September 3, 2015.
• On August 24, 2015, CMS announced an opportunity for the public to comment on the following information collection activities:
  • Medicare Part D Reporting Requirements and Supporting Regulations
  • Part C Medicare Advantage Reporting Requirements and Supporting Regulations
  • Essential Community Provider Data Collection to Support QHP Certification for PY 2017
    
    Comments are due by September 23, 2015.

Event Notices

• September 22-23. 2015: The Centers for Disease Control and Prevention (CDC) will convene a meeting of the ICD–10 Coordination and Maintenance (C&M) Committee. The meeting 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. The meeting will take place at the CMS Auditorium in Baltimore, Maryland from 9:00 AM to 5:00 PM. More information may be found here.

II. CONGRESSIONAL LEGISLATION & COMMITTEE ACTION

U.S. Senate

• The Senate is out of session during the August recess. Both chambers of Congress are expected to resume regular legislative business on September 8th. The Senate calendar may be found here.

House of Representatives

• The House is out of session during the August recess. Both chambers of Congress are expected to resume regular legislative business on September 8th. The House calendar may be found here.

III. REPORTS, STUDIES, & ANALYSES

• On August 21, 2015, the HHS Office of Inspector General (OIG) released a report entitled “NIH Post Award Grant Administration and Oversight Could Be Improved”. In order to conduct their review, OIG used the National Institutes of Health’s (NIH) electronic storage system for grant files to review a random sample of 100 NIH grant files from new and continuing extramural research awards made in FY 2011. They also collected and reviewed information from NIH staff regarding oversight of post-award administration requirements. OIG found weaknesses in the oversight of grantee progress during the life of the grants. Specifically, they found weaknesses in NIH's review of progress reports. NIH approved 13 percent of awards for funding despite the fact that the awardee did not provide required information regarding its progress towards project objectives. NIH awarded $7.2 million to four awardees that reported not meeting established goals or removing a goal. Although NIH policy requires program staff to determine whether awardee progress towards stated goals is satisfactory or not satisfactory, it does not require a written statement to support those determinations. OIG recommend that NIH (1) confirm that grants management staff ensure timely submission of required reports from awardees, and (2) revise the NIH Policy Manual and Award Worksheet Report to require a brief narrative documenting awardee progress and whether any change in research goals may influence continued funding. NIH concurred with both recommendations.
• On August 25, 2015, the Kaiser Family Foundation released an analysis entitled “How Many Employers Could be Affected by the Cadillac Plan Tax?” The Affordable Care Act’s (ACA) high-cost plan tax, which takes effect in 2018, was meant to raise revenue to fund coverage expansions under the health care law and to help contain health spending. It taxes plans at 40 percent of each employee’s health benefits that exceed certain cost thresholds: In the first year, the thresholds are $10,200 for self-only coverage and $27,500 for other than self-only coverage. The thresholds increase annually with inflation. Using data from the forthcoming 2015 Kaiser/HRET Employer Health Benefits Survey, the Foundation’s new analysis estimates the percentage of employers who offer one or more plans that would reach Cadillac tax thresholds for some employees and who would face a choice between paying the tax or restructuring their benefits to avoid it. The Foundation estimates that one in four employers (26%) offering health benefits could be subject to the Affordable Care Act’s tax on high-cost health plans in 2018 unless they make changes to their plans. The analysis also estimates that the share of employers potentially affected by the tax could grow significantly over time — to 30 percent in 2023 and 42 percent in 2028 — if their plans remain unchanged and health benefit costs increase at expected rates.
• On August 24, 2015, the Commonwealth Fund released an issue brief entitled “Competition Among Medicare’s Private Health Plans: Does It Really Exist?” Competition among private Medicare Advantage (MA) plans is seen by some as leading to lower premiums and expanded benefits. Using a standard measure of market competition, the analysis finds that 97 percent of markets in U.S. counties are highly concentrated and therefore lacking in significant MA plan competition. Competition is considerably lower in rural counties than in urban ones. Even among the 100 counties with the greatest numbers of Medicare beneficiaries, the authors write, 81 percent do not have competitive MA markets. Market power was shown to be concentrated among three nationwide insurance organizations in nearly two-thirds of those 100 counties.
• On August 25, 2015, the Congressional Budget Office (CBO) released “An Update to the Budget and Economic Outlook: 2015 to 2025”. CBO expects that the deficit this year will be $426 billion––$60 billion less than projected in March. The economy is expected to expand modestly this year, at a solid pace in 2016 and 2017, and at a more moderate pace in subsequent years. In CBO’s projections, federal outlays remain near 21 percent of GDP for the next several years. Later in the coming decade, under current law, growth in outlays would outstrip growth in the economy; outlays would rise to 22 percent of GDP in 2022 and remain at that level through 2025. (Over the past 50 years, outlays have averaged about 20 percent of GDP.) That trend reflects significant growth in mandatory spending— particularly in federal spending for health care, Social Security, and interest payments— offset somewhat by a decline (relative to the size of the economy) in spending subject to annual appropriations.
• This week the Kaiser Family Foundation published a brief entitled, “A Look at the Private Option in Arkansas”. In September 2013, Arkansas became the first state in the nation to receive approval from the federal government for a Section 1115 demonstration waiver to require most adults who are newly eligible for coverage through the Affordable Care Act’s Medicaid expansion to enroll in Marketplace plans. The initiative, often referred to as the “private option,” has allowed Arkansas to cover close to 220,000 Medicaid beneficiaries with commercial provider networks and strengthen its Marketplace. An additional 25,000 medically frail adults are covered through the state’s fee-for-service system, bringing to 245,000 the number of newly eligible adults covered in Arkansas as of June 30, 2015. Drawing on a dozen interviews with state officials, providers, insurance carriers, and advocates, as well as early data on coverage, reduced uncompensated care costs, and other topics, this issue brief provides an initial look at implementation. Key findings include:
  • Arkansas cut its uninsured rate among non-elderly adults nearly in half (from 27.5 percent to 15.6 percent) between 2013 and 2014.
  • Stakeholders reported that private option enrollees are generally able to access services, and hospitals are seeing sharp drops in uncompensated care, while the impact on community health centers is more mixed.
  • Early reports indicate that private option beneficiaries are receiving wrap-around protections for premiums and cost-sharing that exceed Medicaid limits, while access to wrapped benefits required by Medicaid but not covered in the Marketplace was more mixed.
  • The private option has helped to increase competition in the Arkansas Marketplace and contributed to reductions in premiums.

IV. OTHER HEALTH POLICY NEWS

• On August 25, 2015, CMS released issued 2014 quality and financial performance results for Medicare Accountable Care Organizations (ACOs). According to the results, the 20 ACOs in the Pioneer ACO Model and 333 Medicare Shared Shavings Program ACOs generated more than $411 million in total savings in 2014, which includes all ACOs’ savings and losses. At the same time, 97 ACOs qualified for shared savings payments of more than $422 million by meeting quality standards and their savings threshold. The results also show that ACOs with more experience in the program tend to perform better over time. A CMS fact sheet on the results may be found here.
• On August 27, 2015, CMS announced the next phase in an initiative to reduce avoidable hospitalizations among nursing facility residents. For the past three years, CMS has been partnering with seven organizations to implement strategies to reduce avoidable hospitalizations for Medicare-Medicaid enrollees who are long-stay residents of nursing facilities. This work, the Initiative to Reduce Avoidable Hospitalizations among Nursing Facility Residents, is a result of collaboration between the Medicare-Medicaid Coordination Office and the Center for Medicare and Medicaid Innovation. To launch the second phase of this initiative, CMS is announcing a new funding opportunity that will allow currently participating organizations to apply to test whether a new payment model for nursing facilities and practitioners will further reduce avoidable hospitalizations, lower combined Medicare and Medicaid spending, and improve the quality of care received by long-stay nursing facility residents.