A&B Healthcare Week in Review, September 30, 2016

I. Regulations, Notices, & Guidance

• On September 26, 2016, the Center for Consumer Information & Insurance and Oversight (CCIIO) issued a guidance entitled, Issuer posting of rate filing information. The guidance provides additional information on the reporting requirements that must be met by health insurance issuers that implement rate increases determined by CMS or a State to be unreasonable. Specifically, the guidance explains the manner in which an issuer must “prominently post” the required rate filing information and its Final Justification for implementing a rate increase deemed to be “unreasonable” and clarifies the type of information that an issuer must include in its Final Justification. Additionally, the guidance clarifies that an issuer must prominently display the required rate filing information, including the Final Justification, for at least three years. Comments are due November 29, 2016.
• On September 27, 2016, the Food and Drug Administration (FDA) issued a guidance entitled, Use of the Term “Healthy” in the Labeling of Human Food Products. The guidance advises manufacturers who wish to use the implied nutrient content claim "healthy" to label their food products as provided by our regulations. More specifically, the guidance advises food manufacturers of our intent to exercise enforcement discretion with respect to the implied nutrient content claim "healthy" on foods that have a fat profile of predominantly mono and polyunsaturated fats, but do not meet the regulatory definition of "low fat", or that contain at least 10 percent of the Daily Value (DV) per reference amount customarily consumed (RACC) of potassium or vitamin D.
• On September 27, 2016, the FDA released a Request for Information and Comments on the use of the Term “Healthy” in the Labeling of Human Food Products. This action is consistent with the FDA’s recently released 2016-2025 Foods and Veterinary Medicine (FVM) Program’s strategic plan with specific goals for nutrition and other planned and recent activity including the issuance of final rules updating certain nutrition labeling regulations. Comments are due on January 26, 2017.
• On September 27, 2016, the National Heart, Lung, and Blood Institute (NHLBI) released a request for public comment. NHLBI, with input from federal and nonfederal partners, is developing the COPD National Action Plan to help guide stakeholders nationwide in their efforts to reduce the burden of Chronic Obstructive Pulmonary Disease (COPD). The request asks for comments to help in the current draft of the COPD National Action Plan. Comments are due by October 28, 2016.
• On September 28, 2016, the Centers for Medicare & Medicaid Services (CMS) issued a final rule entitled, Medicare and Medicaid Programs; Reform of Requirements for Long-Term Care Facilities. The final rule will revise the requirements that Long-Term Care facilities must meet to participate in the Medicare and Medicaid programs.  According to CMS, these changes are necessary to reflect the substantial advances that have been made over the past several years in the theory and practice of service delivery and safety. These revisions are also an integral part of CMS’ efforts to achieve broad-based improvements both in the quality of health care furnished through federal programs, and in patient safety, while at the same time reducing procedural burdens on providers. These regulations are effective on November 28, 2016.
• On September 29, 2016, the FDA issued a final order entitled, Medical Devices; Neurological Devices; Classification of the Evoked Photon Image Capture Device. The final order classifies the Evoked Photon Image Capture Device into class I (general controls).
• On September 29, 2016, the Office of Management and Budget (OMB) received a final rule from the Department of Health and Human Services (HHS) entitled, CY 2017 Home Health Prospective Payment System Rate Update; Home Health Value-Based Purchasing Model; and Home Health Quality Reporting Requirements. The final rule would update the 60-day national episode rate, the national per-visit rates used to calculate low utilization payment adjustments (LUPAs), and outlier payments under the Medicare prospective payment system for home health agencies. The rule would also update the provisions of the Home Health Value-Based Purchasing (HHVBP) program.
• On September 29, 2016, OMB received a final rule from HHS entitled, CY 2017 Hospital Outpatient PPS Policy Changes and Payment Rates and Ambulatory Surgical Center Payment System Policy Changes and Payment Rates (CMS-1656-P). The final rule would revise the Medicare hospital outpatient prospective payment system to implement statutory requirements and changes arising from our continuing experience with this system. The rule describes changes to the amounts and factors used to determine payment rates for services. In addition, the rule would change the ambulatory surgical center payment system list of services and rates.
• On September 29, 2016, OMB received a final rule from HHS entitled, CY 2017 Changes to the End-Stage Renal Disease (ESRD) Prospective Payment System and Quality Incentive, Durable Medical Equipment, and DMEPOS Competitive Bidding Programs (CMS-1651-P). The final rule would update the bundled payment system for ESRD facilities by January 1, 2017. The rule would also update the quality incentives in the ESRD program.  Additionally, the rule would include clarifications to the Part B benefit for the Durable Medical Equipment program and updates to the Durable Medical Equipment Prosthetics, Orthotics, and Supplies (DMEPOS) competitive bidding program.
• On September 29, 2016, the FDA issued a notice entitled, Agency Information Collection Activities; Proposals, Submission, and Approvals: Donor Risk Assessment Questionnaire. The FDA requests comments on the following topics: 1) Whether the proposed collection of information is necessary for the proper performance of FDA's functions, including whether the information will have practical utility; 2) the accuracy of FDA's estimate of the burden of the proposed collection of information, including the validity of the methodology and assumptions used; 3) ways to enhance the quality, utility, and clarity of the information to be collected; and 4) ways to minimize the burden of the collection of information on respondents, including through the use of automated collection techniques, when appropriate, and other forms of information technology. Comments are due on November 29, 2016.
• On September 29, 2016, the FDA issued a notice entitled, Fee for Using a Rare Pediatric Disease Priority Review Voucher in Fiscal Year 2017. The notice establishes the rare pediatric disease priority review fee rate for FY 2017 and outlines the payment procedures for such fees.
• On September 29, 2016, the FDA issued a notice entitled, Fee for Using Tropical Disease Priority Review Voucher in Fiscal Year 2017. The notice establishes the tropical disease priority review fee rate for FY 2017.
• On September 30, 2016, HHS issued a guidance entitled, National Institute for Occupational Safety and health List of Antineoplastic and Other Hazardous Drugs in healthcare Settings 2016. The current update (2016) adds 34 drugs and includes a review of the 2004 list, five of which have safe-handling recommendations from the manufacturers.

Event Notices

• October 11, 2016: CMS announced a virtual office hour session entitled, 2016 PQRS Reporting: MAVF and How to Get Started. Topics to be discussed in this session include how the Measure Applicability Validation (MAV) process is applied to data submitted via claims and qualified registry.
• October 13, 2016: CMS announced that it will host a CMS National Training program Learning Series Webinar. The webinar will provide information about current topics including: 1) legislation updates; 2) CMS Goals and Initiatives; 3) Medicare Updates; and 4) Medicaid/Children’s Health Insurance Program Updates. 

II. Congressional Legislation & Committee Action

U.S. Senate

• There were no health care related hearings held this week.

House of Representatives

• On September 28, 2016, the House Ways and Means, Oversight Subcommittee held a hearing entitled, “Health Care Fraud Investigations.” The witnesses included Ms. Barbara McQuade, United States Attorney, Eastern District of Michigan; Mr. Abhijit Dixit, Special Agent, Office of Investigations, Office of Inspector General, Department of Health and Human Services; and Mr. Scott Ward, Senior Vice President, Health Integrity LLC.
• On September 27, 2016, the House Energy and Commerce, Oversight and Investigations Subcommittee held a hearing entitled, “Bioresearch Labs and Inactivation of Dangerous Pathogens.” The witnesses included Mr. Steve Monroe, Associate Director for Laboratory Science and Safety at the Centers for Disease Control and Prevention; Mr. Timothy Persons, Director of Applied Research and Methods at the Government Accountability Office; Mr. Jeff Potts, Biorisk Manager at the National Institutes of Health; and Mr. Daniel Sosin, Deputy Director and Chief Medical Officer in the Centers for Disease Control and Prevention's Office of Public Health Preparedness and Response.

III. Reports, Studies, & Analyses 

• On September 26, 2016, the Congressional Budget Office (CBO) issued a cost estimate of H.R. 1877, Mental Health First Aid Act of 2016. CBO estimates implementing the bill would cost $62 million over the 2017-2021 period. Additionally, CBO estimates that enacting H.R. 1877 would not increase net direct spending or on-budget deficits in any of the four consecutive 10-year periods beginning in 2027.
• On September 26, 2016, the Government Accountability Office (GAO) issued a report entitled, Electronic Health Information: HHS Needs to Strengthen Security and Privacy Guidance and Oversight. The report found that the use of electronic health information can allow providers to more efficiently share information and give patients easier access to their health information, among other benefits. Nonetheless, systems storing and transmitting health information in electronic form are vulnerable to cyber-based threats. Additionally, the report found that the resulting breaches—involving over 113 million records in 2015—could have serious adverse impacts such as identity theft, fraud, and disruption of health care services, and their number has increased steadily in recent years, from 0 in 2009 to 56 in 2015.
• On September 27, 2016, the Office of Inspector General (OIG) issued a report entitled, Vermont Did Not Properly Allocate Millions to Establishment Grants for a Health Insurance Marketplace. The report found that The Department of Vermont Health Access, part of Vermont's Agency of Human Services (State agency) did not always follow Federal requirements for allocating costs to its establishment grants for implementing a health insurance marketplace and drawing down establishment grant funds. Specifically, the State agency: 1) allocated $10.5 million from July 2012 through September 2013 using a cost allocation methodology that included a material defect; 2) may not have allocated $13.9 million in costs from April through September 2014 in accordance with the relative benefits that each grant program received; and 3) drew down establishment grant funds that exceeded actual program costs by $736,330 from January through September 2014.
• On September 28, 2016, the GAO released a report entitled, NIH Biomedical Research; Agencies Involved in the Indirect Cost Rate-Setting Process Need to Improve Controls. The report found that while the three agencies (HHS’s Cost Allocation Services, NIH’s Division of Financial Advisory Services, and the Department of Defense’s Office of Naval Research) had designed controls for setting indirect cost rates, deficiencies in the design of some of these controls could result in the waste of federal resources. Additionally, the report made 12 recommendations for agencies involved in the indirect cost rate-setting process.
• On September 29, 2016, OIG released a report entitled, Illinois Claims Some Improper Federal Medicaid Reimbursement for Inpatient Hospital Services Related to Treating Provider-Preventable Conditions. The report found that Illinois improperly claimed $149,000 in Federal Medicaid reimbursement over a 2-year period for inpatient hospital services related to treating certain provider-preventable conditions. In addition, Illinois improperly reduced Federal Medicaid reimbursement by $52,000 for inpatient hospital services that did not relate to treating provider-preventable conditions.
• On September 29, 2016, OIG released a report entitled, California Made Incorrect Medicaid Electronic Health Record Incentive Payments to Hospitals. The report found that although the California Department of Health Care Services (State agency) made Medicaid electronic health record (EHR) incentive program payments to eligible hospitals, it did not always make these payments in accordance with Federal requirements. Specifically, from October 1, 2011, through December 31, 2015, the State agency made incorrect Medicaid EHR incentive payments to 61 of the 64 hospitals reviewed, totaling $23.2 million. These incorrect payments included both overpayments and underpayments, resulting in a net overpayment of $22 million. Because the incentive payment is calculated once and then paid out over 4 years, payments made after December 31, 2015, will also be incorrect. The adjustments to these payments total $6.3 million.
• On September 29, 2016, OIG released a report entitled, North Carolina State Medicaid Fraud Control Unit: 2016 Onsite Review. The report found that for FYs 2013 through 2015, the North Carolina Unit reported 57 convictions, 49 civil judgments and settlements, and combined criminal and civil recoveries of over $134 million.
• On September 29, 2016, the GAO released a study entitled, Medicaid Fee-For-Service: State Resources Vary for Helping Beneficiaries Find Providers. The report found that the 23 states GAO reviewed have 4 common types of resources to help beneficiaries: 1) searchable provider directories; 2) nonsearchable provider lists; 3) beneficiary helplines; and 4) beneficiary handbooks.
• On September 30, 2016, OIG issued a report entitled, Maryland State Medicaid Fraud Control Unit: 2016 Onsite Review. The report found that for FYs 2013 through 2015, the Maryland Unit reported 42 convictions, 61 civil judgments and settlements, and combined criminal and civil recoveries of over $70 million.
• On September 30, 2016, OIG released a report entitled, CGS Administrators, LLC’s Postretirement Benefit Costs for Fiscal Year 2011 Were Reasonable and Allowable. The report found that postretirement benefit costs totaling $4,000 that CGS Administrators, LLC, claimed for Medicare reimbursement for fiscal year 2011 were reasonable and allowable.
• On September 30, 2016, OIG released a report entitled, Palmetto Government Benefits Administrator, LLC, Claimed Some Unallowable Medicare Postretirement Benefit Costs for Fiscal Years 2005 Through 2011. The report found that Palmetto Government Benefits Administrator, LLC, a subsidiary of Blue Cross Blue Shield South Caroline, claimed unallowable postretirement benefit costs of $665,000 for Medicare reimbursement for fiscal years 2005 through 2011.
• On September 30, 2016, OIG released a report entitled, Medicare Improperly Paid Millions of Dollars for Unlawfully Present Beneficiaries for 2013 and 2014. The report found that CMS had policies and procedures to ensure that payments were not made for Medicare services rendered to unlawfully present beneficiaries in accordance with Federal requirements, but it did not always follow those policies and procedures.

IV. Other Health Policy News

• On September 26, 2016, BlueCross BlueShield of Tennessee announced they will no longer offer plans in the Memphis, Nashville, and Knoxville regions in 2017. In a statement, the company said “we have tried to make the ACA Marketplace model work for Tennessee, but we believe there are too many uncertainties to continue participating on a statewide level as we have before.”
• On September 27, 2016, the National Institutes of Health (NIH) released a notice listing the members of the NIH’s Senior Executive Service 2016 Performance Review Board (PRB).
• On September 28, 2016, HHS announced the winners of the "A Bill You Can Understand" challenge, a design and innovation challenge to solicit new approaches and draw national attention to a common complaint with the health care system: that medical billing is a source of confusion for patients and families.
• On September 29, 2016, the Physician-Focused Payment Model Technical Advisory Committee announced that it would begin accepting letters of intent (LOI) for the submission of physician-focused payment model (PFPM) proposals starting on October 1, 2016.
• On September 29, 2016, CMS announced the recipients of the second round of the Support and Alignment networks under the Transforming Clinical Practice Initiative (TCPI). The opportunity will provide up to $5 million to two awardees over the next three years to leverage primary and specialist care transformation work and learning.
• On September 29, 2016, CMS announced that it had awarded 16 national, regional, and state hospital associations, Quality Improvement Organizations, and health system organizations $347 million to continue efforts in reducing hospital-acquired conditions and readmission in the Medicare program.
• On September 29, 2016, CMS released a bulletin entitled, Enhancing Enrollment of Individuals Transitioning from Medicaid or CHIP to Marketplace Coverage. The bulletin highlights the ways states served by the Federally-Facilitated Marketplace (FFM) can help to facilitate enrollment in Marketplace coverage for people transferred to the FFM when denied Medicaid/CHIP eligibility by the state Medicaid/CHIP agency. The bulletin also provides information that may be useful for State-based Marketplaces working to improve their eligibility and enrollment coordination processes with state Medicaid/CHIP agencies.