Alston & Bird Healthcare Week in Review, April 28, 2017

Regulations, Notices, & Guidance

• On April 24, 2017, the Food and Drug Administration (FDA) issued a draft guidance entitled, Extending Expiration Dates of Doxycycline Tablets and Capsules in Strategic Stockpiles. The  draft guidance, once finalized, will provide guidance to government stakeholders on testing to extend the shelf life (e., expiration date) under the Federal Food, Drug, and Cosmetic Act (the FD&C Act) of stockpiled doxycycline tablets and capsules for public health emergency preparedness and response purposes for an anthrax emergency. According to the FDA, the draft guidance has been prepared in response to requests from States asking the FDA what would be necessary to provide confidence that stockpiled doxycycline tablets and capsules have retained their original quality beyond the manufacturer’s labeled expiration date so the replacement of stockpiled product could be deferred. The draft guidance and any resulting expiration date extensions authorized by the FDA do not apply to doxycycline available commercially or otherwise held for any other non-emergency purpose. Comments are due by July 26, 2017.

• On April 24, 2017, the FDA issued a draft guidance entitled, Extending Expiration Dates of Doxycycline Tablets and Capsules in Strategic Stockpiles. The draft guidance, once finalized, will provide guidance to government stakeholders on testing to  extend the shelf life (e., expiration date) under section 564A(b) of the FD&C Act of stockpiled doxycycline tablets and capsules for public health emergency preparedness and response purposes for an anthrax emergency.

• On April 26, 2017, the Office of Management and Budget (OMB) received a proposed rule from the Centers for Medicare & Medicaid Services (CMS) entitled, Advancing Care Coordination Through Episode Payment Models (EPMs); Cardiac Rehabilitation Incentive Payment Model; and Changes to Comprehensive Care for Joint Replacement Model. According to CMS, the proposed rule encourages care coordination among providers furnishing services to Medicare beneficiaries, which CMS expects will lead to higher quality health care.

• On April 27, 2017, the Centers for Disease Control and Prevention (CDC) issued a notice entitled, Announcement of Requirements and Registration for Healthy Behavior Challenge. The notice announces that the CDC will launch the Healthy Behavior Data Challenge. According to the CDC, the Healthy Behavior Data Challenge responds to the call for new ways to address the challenges and limitations of self-reported health surveillance information and tap into the potential of innovative data sources and alternative methodologies for public health surveillance. Challenge participants will propose data sources and approaches for aggregating data from wearable devices, mobile applications and/or social media in the areas of nutrition, physical activity, sedentary behaviors, and/or sleep.

• On April 27, 2017, the FDA issued a notice entitled, Determination that DEMEROL (Meperidine Hydrochloride) Injectable and Other Drug Products Were Not Withdrawn from Sale for Reasons of Safety or Effectiveness. The notice announces that the FDA has determined that the drug products listed in this notice were not withdrawn from sale for reasons of safety or effectiveness. According to the FDA, this determination means that the FDA will not begin procedures to withdraw approval of abbreviated new drug applications (ANDAs) that refer to these drug products, and it will allow the FDA to continue to approve ANDAs that refer to the products as long as they meet relevant legal and regulatory requirements.

• On April 27, 2017, the FDA issued a notice entitled, Government-Owned Inventions; Availability for Licensing. The notice announces that the U.S. Government owns an invention for solid-phase purification of synthetic DNA sequences. According to the FDA, scientists at the FDA have developed a high-throughput method for purifying full-length phosphorothioate and native DNA sequences. The method comprises a modified silica gel that enables capture of DNA sequences functionalized with a novel linker specifically designed for exclusive capture of full-length sequences. The technology has been shown to generate DNA sequences of high purity without the need of expensive equipment. The notice also announces that the U.S. Government is making this technology available for licensing.

• On April 27, 2017, CMS issued a proposed rule entitled, Medicare Program; FY 2018 Hospice Wage Index and Payment Rate Update and Hospice Quality Reporting Requirements. The proposed rule would update the hospice wage index, payment rates, and cap amount for fiscal year (FY) 2018. Additionally, the proposed rule proposes changes to the hospice quality reporting program, including proposing new quality measures, soliciting feedback on an enhanced data collection instrument, and describing plans to publicly display quality measures and other hospice data. Comments are due by June 26, 2017.

• On April 27, 2017, CMS issued a proposed rule entitled, Medicare Program; Inpatient Rehabilitation Facility Prospective Payment System for Federal Fiscal Year 2018. The proposed rule would update the prospective payment rates for inpatient rehabilitation facilities (IRFs) for federal FY 2018 as required by the statute. As required by section 1886(j)(5) of the Act, the proposed rule includes the classification and weighting factors for the IRF prospective payment system’s (IRF PPS) case-mix groups and a description of the methodologies and data used in computing the prospective payment rates for FY 2018. CMS is also proposing to remove the 25 percent payment penalty for inpatient rehabilitation facility patient assessment instrument (IRF-PAI) late transmissions, remove the voluntary swallowing status item (Item 27) from the IRF-PAI, revise the International Classification of Diseases, 10th Revision, Clinical Modification (ICD-10-CM) diagnosis codes that are used to determine presumptive compliance under the “60 percent rule,” solicit comments regarding the criteria used to classify facilities for payment under the IRF PPS, provide for automatic annual updates to presumptive methodology diagnosis code lists, use height/weight items on the IRF-PAI to determine patient body mass index (BMI) greater than 50 for cases of single-joint replacement under the presumptive methodology, and revise and update quality measures and reporting requirements under the IRF quality reporting program (QRP). Comments are due by June 26, 2017.

• On April 27, 2017, CMS issued a proposed rule entitled, Medicare Program; Prospective Payment System and Consolidated Billing for Skilled Nursing Facilities for FY 2018, SNF Value-Based Purchasing Program, SNF Quality Reporting Program, Survey Team Composition, and Proposal to Correct the Performance Period for the NHSN HCP Influenza Vaccination Immunization Reporting Measure in the ESRD QIP for PY 2020. The proposed rule would update the payment rates used under the prospective payment system (PPS) for skilled nursing facilities (SNFs) for FY 2018. It also proposes to revise and rebase the market basket index by updating the base year from 2010 to 2014, and by adding a new cost category for Installation, Maintenance, and Repair Services. The rule also includes proposed revisions to the SNF QRP, including measure and standardized patient assessment data proposals and proposals related to public display. In addition, it includes proposals for the SNF Value-Based Purchasing Program that will affect Medicare payment to SNFs beginning in FY 2019 and clarification on the requirements regarding the composition of professionals for the survey team. The proposed rule also seeks to clarify the regulatory requirements for team composition for surveys conducted for investigating a complaint and to align regulatory provisions for investigation of complaints with the statutory requirements. The proposed rule also includes one proposal related to the performance period for the National Healthcare Safety Network (NHSN) Healthcare Personnel (HCP) Influenza Vaccination Reporting Measure included in the End Stage Renal Disease (ESRD) Quality Incentive Program (QIP). Comments are due by June 26, 2017.

• On April 27, 2017, CMS issued an advance notice of proposed rulemaking (ANPRM) with comment entitled, Medicare Program; Prospective Payment System and Consolidated Billing for Skilled Nursing Facilities: Revisions to Case-mix Methodology. According to CMS, they are issuing the ANPRM to solicit public comments on potential options we may consider for revising certain aspects of the existing SNF PPS payment methodology to improve its accuracy, based on the results of our SNF Payment Models Research (SNF PMR) project. In particular, CMS is seeking comments on the possibility of replacing the SNF PPS’ existing case-mix classification model, the Resource Utilization Groups, Version 4 (RUG-IV), with a new model, the Resident Classification System, Version I (RCS-I). Comments are due by June 26, 2017.

• On April 27, 2017, the Department of Health and Human Services (HHS) issued a notice entitled, Solicitation of Nominations for Three Organizations to Serve as Non-Voting Liaison Representatives to the Chronic Fatigue Syndrome Advisory Committee. The notice announces that HHS is seeking nominations for the Chronic Fatigue Syndrome Advisory Committee (CFSAC). According to HHS, the organizations designated to fill these positions will be selected from those concerned with myalgic encephalomyelitis/chronic fatigue syndrome (ME/CFS). The Designated Federal Officer (DFO) for CFSAC will select the organizations from which the representative will be selected to fill these vacant positions. The representatives selected to fill these positions will serve a two-year term as a non-voting liaison representative. Nominations are due by May 30, 2017.

• On April 28, 2017, the Substance Abuse and Mental Health Services Administration (SAMHSA) issued a notice entitled, Current List of HHS-Certified Laboratories and Instrumented Initial Testing Facilities which Meet Minimum Standards to Engage in Urine Drug Testing for Federal Agencies. The notice notifies federal agencies of the laboratories and Instrumented Initial Testing Facilities (IITF) currently certified to meet the standards of the Mandatory Guidelines for Federal Workplace Drug Testing Programs (Mandatory Guidelines).

• On April 28, 2017, HHS issued a notice entitled, Tribal Management Grant Program. The notice announces that The Indian Health Service (IHS) is accepting competitive grant applications for the Tribal Management Grant (TMG) program. According to HHS, the purpose of the IHS grant announcement is to announce the availability of the TMG Program to enhance and develop health management infrastructure and assist T/TO in assuming all or part of existing IHS PSFAs through a Title I contract and assist established Title I contractors and Title V compactors to further develop and improve their management capability. Applications are due by June 4, 2017.

• On April 28, 2017, SAMHSA issued a notice entitled, Establishment of the Interdepartmental Serious Mental Illness Coordinating Committee (ISMICC). The ISMICC is established in accordance with section 6031 of the 21st Century Cures Act, and the Advisory Committee Act, 5 U.S.C. App., as amended, to report to the Secretary, Congress, and any other relevant federal department or agency on advances in serious mental illness (SMI) and serious emotional disturbance (SED), research related to the prevention of, diagnosis of, intervention in, and treatment and recovery of SMIs, SEDs, and advances in access to services and support for adults with SMI or children with SED.

• May 9 – 10, 2017: The FDA announced a 2-day pubic conference entitled, FDA Small Business and Industry Assistance Regulatory Education for Industry (REdI) Spring Conference. According to the FDA, the goal of the public conference is to provide direct, relevant, and helpful information on the key aspects of drug and medical device regulations in order to increase regulatory certainty and predictability for pharmaceutical and/or medical device industry.

• May 18, 2017: The FDA announced a public advisory committee meeting of the Pediatric Advisory Committee (PAC) and the Pediatric Ethics Subcommittee (PES). On May 18, 2017, the PAC and the PES will meet to discuss a referral by an Institutional Review Board (IRB) of a clinical investigation that involves children and FDA regulated products. The clinical investigation is entitled, A Double-Blind, Placebo-Controlled, 5 Multi-Center Study with an Open-Label Extension to Evaluate the Efficacy and Safety of SRP- 4045 and SRP-4053 in Patients with Duchenne Muscular Dystrophy. After presentation of an overview of the IRB referral process under 21 CFR 50.54, an overview of the protocol and the issues raised by the IRB referral, other relevant presentations about the request to modify the protocol, and a summary of the public comments received concerning whether the protocol should proceed as modified, the committee will discuss the protocol modification and develop a recommendation regarding whether the protocol should proceed as modified. The committee’s recommendation will then be presented to the Commissioner of Food and Drugs.
• May 18 – 19, 2017: The FDA announced a public workshop entitled, Cybersecurity of Medical Devices: A Regulatory Science Gap Analysis. The objective of the workshop is to facilitate a discussion on the current state of regulatory science in the field of cybersecurity of medical devices, with a focus on patient safety. The purpose of this public workshop is to catalyze collaboration among HPH stakeholders to identify regulatory science challenges, discuss innovative strategies to address those challenges, and encourage proactive development of analytical tools, processes, and best practices by the stakeholder community to strengthen medical device cybersecurity.
• May 23, 2017: The National Institutes of Health’s (NIH) Interagency Coordinating Committee on the Validation of Alternative Methods (ICCVAM) announced it will hold a public forum to share information and facilitate direct communication of ideas and suggestions from stakeholders. The meeting will include presentation from the National Toxicology Program Interagency Center for the Evaluation of Alternative Toxicological Methods (NICEATM) and ICCVAM members on current activities related to the development and validation of 3 alternative test methods and approaches, including discussions of the proposed strategic roadmap to establish new approaches for evaluating the safety of chemicals and medical products in the United States.
• July 10, 2017: The FDA announced a public workshop entitled, Sentinel Training at FDA. The purpose of the public workshop is to provide training to understand the kinds of questions that can be asked using health care claims data generally and within the FDA Sentinel System specifically, allowing an understanding of the capabilities of the Sentinel System.

II. Congressional Legislation & Committee Action

• On April 26, 2017, the Senate Special Aging Committee held a hearing entitled, Aging Without Community: The Consequences of Isolation and Loneliness. The witnesses included Julianne Holt-Lunstad, PhD, Brigham Young University; Lenard Lenard Kaye, DSW, PhD, Professor of Social Work, Director of the Center on Aging, University of Maine; Mark Clark, MSW, President and CEO, Pima Council on Aging; and Rick Creech, Educational Consultant, Pennsylvania Training and Technical Assistance Network.

• On April 26 – 27, 2017, Senate Health, Education, Labor and Pensions Committee held a markup of S.652, the "Early Hearing Detection and Intervention Act of 2017"; H.R.309, the "National Clinical Care Commission Act"; the "Protecting Patient Access to Emergency Medications Act of 2017"; S.849, the "Strengthening Mosquito Abatement for Safety and Health (SMASH) Act"; and voted (14-9) on the nomination of Scott Gottlieb to be commissioner of the FDA.

• On April 26, 2017, the House Ways and Means Committee held a hearing entitled, Stopping Disability Fraud: Risk, Prevention and Detection. The witnesses included Sean Brune, Assistant Deputy Commissioner, Office of Budget, Finance, Quality and Management, Social Security Administration and Seto J. Bagdoyan, Director, Forensic Audits and Investigative Service, Government Accountability Office (GAO).

• Currently there are no healthcare-related hearings scheduled for next week.

• On May 2, 2017, the House Energy and Commerce Health Subcommittee will hold a hearing on "Examining Improvements to the Regulation of Medical Technologies," including H.R.1652, the "Over-the-Counter Hearing Aid Act of 2017"; H.R.1736, to amend the Federal Food, Drug, and Cosmetic Act to improve the process for inspections of device; H.R.2009, the "Fostering Innovation in Medical Imaging Act"; and H.R.2118, the Medical Device Servicing and Accountability Act." The hearing will take place at 10:00 a.m. in 2123 Rayburn. The witnesses are TBD.
• On May 2, 2017, the House Energy and Commerce Oversight and Investigations Subcommittee will hold a hearing entitled, Combating Waste, Fraud, and Abuse in Medicaid's Personal Care Services Program. The hearing will take place at 10:15 a.m. in 2322 Rayburn. The witnesses are TBD.

• On April 21, 2017, the Office of Inspector General (OIG) released a report entitled, California Incorrectly Claimed Additional Medicaid Funding Authorized Under the Recovery Act When Reclaiming Overpayments Made to Bankrupt or Out-of-Business Providers. The report found that for Federal fiscal years 2010 through 2013, the California Department of Health Care Services (State agency) claimed $58.3 million in Federal reimbursement for Medicaid overpayments that it made to providers who were determined to be bankrupt or out of business (uncollectible overpayments). The State agency complied with Federal requirements when reclaiming Federal Medicaid reimbursement for uncollectible overpayments. However, the State agency incorrectly used increased Federal medical assistance percentages (FMAPs) authorized under the American Recovery and Reinvestment Act to claim additional Federal reimbursement of $6.6 million for uncollectible overpayments that were not originally made during the recession adjustment period (October 1, 2008, through June 30, 2011) or were not previously refunded to the Federal Government using the increased FMAPs.
• On April 21, 2017, the OIG released a report entitled, Florida Did Not Suspend Medicaid Payments to Some Providers That Had Credible Fraud Allegation Cases in Accordance With the Social Security Act. The report found that the Florida Agency for Health Care Administration did not always suspend Medicaid payments to providers that had credible fraud allegation cases in accordance with the Social Security Act. Of the 95 cases that the OIG reviewed, the Florida Agency for Health Care Administration applied a good-cause exception not to suspend payments for 1 case; and it either suspended, pursued recovery, or otherwise did not make Medicaid payments to providers related to 40 other cases. For the remaining 54 cases, the Florida Agency for Health Care Administration did not suspend Medicaid payments for 4 cases totaling $13.8 million ($8.1 million Federal Share). Furthermore, for one case with a completed investigation that resulted in a civil settlement, the State agency did not provide documentation to support that it returned the Federal share of $237,000 to the Federal Government. Finally, for 49 cases for which the Florida Medicaid Fraud Control Unit (MFCU) had completed its investigation and payment suspension was no longer proper, the State agency had not suspended Medicaid payments totaling $70.3 million ($40 million Federal share) when a fraud investigation was pending.
• On April 21, 2017, the OIG released a report entitled, Ohio’s and Michigan’s Sales and Use Taxes on Medicaid Managed Care Organization Services Do Not Meet Broad-Based Requirement. The report found that if a State taxes Medicaid managed care organizations (MCOs), the tax must extend to both Medicaid and non-Medicaid MCOs (i.e., be broad based) to comply with Federal requirements. At the time of the OIG’s audit in 2016, two States did not meet Federal requirements stating that taxes on MCOs be broad based. Specifically, Ohio and Michigan continued to tax only Medicaid MCOs under their sales and use tax programs. Ohio stated that it would work with the Centers for Medicare & Medicaid Services (CMS) to address changes that might need to be made to its tax.
• On April 26, 2017, the GAO released a report entitled, Pediatric Trauma Centers: Availability, Outcomes, and Federal Support Related to Pediatric Trauma Care. The GAO estimates that 57 percent of the 73.7 million children in the United States during the period 2011-2015 lived within 30 miles of a pediatric trauma center that can treat all injuries regardless of severity. Among states, the proportion of children who lived within 30 miles of these pediatric trauma centers varied widely. In areas without pediatric trauma centers, injured children may have to rely on adult trauma centers or less specialized hospital emergency departments for initial trauma care. Some studies the GAO reviewed, including nationwide studies, found that children treated at pediatric trauma centers have a lower mortality risk compared to children treated at adult trauma centers and other facilities, while other state-level studies the GAO reviewed found no difference in mortality. Further, some studies the GAO reviewed and stakeholders the GAO interviewed suggest that more information is needed on outcomes other than mortality for children treated at pediatric trauma centers because mortality can be a limited outcome measure, as overall mortality is low among severely injured children.
• On April 28, 2017, the OIG released a report entitled, Illinois Made Correct Medicaid Claim Adjustments. The report found that the Illinois Department of Healthcare and Family Services used correct Federal medical assistance percentages when processing Medicaid claim adjustments reported on the CMS-64 for both public and private providers. Accordingly, this report contains no recommendations.

IV. Other Health Policy News

• On April 27, 2017, CMS issued a fact sheet on Medicare’s proposed FY 2018 payment and policy changes for SNFs. The fact sheet discusses major provisions of the proposed rule, including proposals for the SNF Value-Based Purchasing Program, and the SNF QRP.

• On April 27, 2017, CMS issued a fact sheet on the proposed rule outlining proposed FY 2018 Medicare payment policies and rates for the IRF PPS and the IRF QRP.

• On April 27, 2017, CMS issued a fact sheet on the proposed rule that would update FY 2018 Medicare payment rates and the wage index for hospices serving Medicare beneficiaries.

• On April 28, 2017, Congress passed a continuing resolution to fund the government another week. The text of the continuing resolution can be found here.

V. ACA Repeal News

• On April 27, 2017, Representative Tom MacArthur (R-NJ) introduced a discussion draft amendment to the American Health Care Act (AHCA). As outlined in the discussion draft, the amendment would repeal the language included in a March 23, 2017 amendment to the AHCA that would have allowed states, beginning in 2018, to define the essential health benefits for purposes of determining premium tax credits (but not for other purposes). In its place the amendment would allow states to apply for waivers to “encourage fair health insurance premiums.”