Alston & Bird Healthcare Week in Review, August 4, 2017

I. Regulations, Notices, & Guidance

• On July 31, 2017, the Centers for Medicare & Medicare Services (CMS) issued a final rule entitled, Medicare Program; Inpatient Rehabilitation Facility Prospective Payment System for Federal Fiscal Year 2018. The final rule updates 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 Social Security Act (the Act), the final 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. The final rule also revises 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,” removes the 25 percent payment penalty for inpatient rehabilitation facility patient assessment instrument (IRF-PAI) late transmissions, removes the voluntary swallowing status item (Item 27) from the IRF-PAI, summarizes comments regarding the criteria used to classify facilities for payment under the IRF PPS, provides for a subregulatory process for certain annual updates to the presumptive methodology diagnosis code lists, adopts the use of 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 revises and updates measures and reporting requirements under the IRF quality reporting program.
• On July 31, 2017, CMS issued a final 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 Correction of the Performance Period for the NHSN HCP Influenza Vaccination Immunization Reporting Measure in the ESRD QIP for PY 2020. The final rule updates the payment rates used under the prospective payment system (PPS) for skilled nursing facilities (SNFs) for FY 2018. It also revises and rebases 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 finalizes revisions to the SNF Quality Reporting Program (QRP), including measure and standardized resident assessment data policies and policies related to public display. In addition, it finalizes policies for the Skilled Nursing Facility Value-Based Purchasing Program that will affect Medicare payment to SNFs beginning in FY 2019. The final rule also clarifies the regulatory requirements for team composition for surveys conducted for investigating a complaint and aligns regulatory provisions for investigation of complaints with the statutory requirements. The final rule also finalizes 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 for Payment Year 2020.
• On August 1, 2017, the Food and Drug Administration (FDA) issued a guidance entitled, Antibacterial Therapies for Patients With an Unmet Medical Need for the Treatment of Serious Bacterial Diseases. The purpose of the guidance is to assist sponsors in the development of new antibacterial drugs to treat serious bacterial diseases in patients with an unmet medical need, including patients who have a serious bacterial disease for which effective antibacterial drugs are limited or lacking. This guidance finalizes the draft guidance of the same name issued July 2, 2013. Comments may be submitted at any time.
• On August 1, 2017, the National Institutes of Health (NIH) issued a notice entitled, Request for Letters of Interest (LOI) for NCI-MATCH Laboratories. The notice announces that the National Cancer Institute (NCI) in collaboration with the NCI Molecular Analysis for Therapy Choice (MATCH) trial leadership (NCT 02465060) invites applications for Clinical Laboratory Improvements Program (CLIA) certified/accredited laboratories that test tumor specimens from patients utilizing Next Generation Sequencing (NGS) assays to participate in the NCI MATCH trial. Letters are due by January 31, 2018.
• On August 1, 2017, the FDA issued a notice entitled, Outsourcing Facility Fee Rates for Fiscal Year 2018. The notice announces the fiscal year (FY) 2018 rates for the establishment and re-inspection fees related to entities that compound human drugs and elect to register as outsourcing facilities under the Federal Food, Drug, and Cosmetic Act (the FD&C Act). The notice also establishes the FY 2018 rates for the small business establishment fee ($5,364), the non-small business establishment fee ($17,364), and the reinspection fee ($16,093) for outsourcing facilities; provides information on how the fees for FY 2018 were determined; and describes the payment procedures outsourcing facilities should follow. These fee rates are effective October 1, 2017, and will remain in effect through September 30, 2018.
• On August 1, 2017, the Department of Health and Human Services (HHS) issued a notice entitled, Solicitation of Nominations for Membership on the Secretary’s Advisory Committee on Human Research Protections. The notice announces that the Office for Human Research Protections (OHRP) is seeking nominations of qualified candidates to be considered for appointment as members of the Secretary’s Advisory Committee on Human Research Protections (SACHRP). OHRP is seeking nominations of qualified candidates to fill four positions on the Committee membership that will be vacated during the 2018 calendar year. Nominations are due by September 18, 2017.
• On August 1, 2017, CMS issued a final rule entitled, Medicare Program; FY 2018 Hospice Wage Index and Payment Rate Update and Hospice Quality Reporting Requirements. This final rule updates the hospice wage index, payment rates, and cap amount for FY 2018. Additionally, the final rule includes new quality measures and provides an update on the hospice quality reporting program.
• On August 2, 2017, the FDA issued a draft guidance entitled, Child-Resistant Packaging Statements in Drug Product Labeling. The draft guidance is intended to assist applicants, manufacturers, packagers, and distributors who choose to include child-resistant packaging (CRP) statements in prescription and over-the-counter human drug product labeling. The draft guidance discusses what information should be included to support CRP statements and to help ensure that such labeling is clear, useful, informative, and, to the extent possible, consistent in content and format. Comments are due by October 2, 2017.
• On August 2, 2017, the FDA issued a notice entitled, Receipt of Notice That a Patent Infringement Complaint Was Filed Against a Biosimilar Applicant. The notice announces that an applicant for a proposed biosimilar product notified the FDA that a patent infringement action was filed in connection with the applicant’s biologics license application (BLA). The FDA received notice of the following complaint under section 351(l)(6)(C) of the Public Health Services Act: Amgen, Inc., et al. v. Coherus Biosciences, Inc., 17-cv-00546 (D. Del., filed May 10, 2017).
• On August 2, 2017, the Centers for Disease Control and Prevention (CDC) issued a notice entitled, Vaccines Adverse Event Reporting System (VAERS) 2.0 Form. The notice announces the availability of the final Vaccines Adverse Event Reporting System (VAERS) 2.0 Form vaers.hhs.gov. The VAERS 2.0 Form replaces the VAERS-1 Form which had been in use since 1990.
• On August 2, 2017, CMS issued a final rule entitled, Medicare Program; Hospital Inpatient Prospective Payment Systems for Acute Care Hospitals and the Long-Term Care Hospital Prospective Payment System and Policy Changes and Fiscal Year 2018 Rates; Quality Reporting Requirements for Specific Providers; Medicare and Medicaid Electronic Health Record (EHR) Incentive Program Requirements for Eligible Hospitals, Critical Access Hospitals, and Eligible Professionals; Provider-Based Status of Indian Health Service and Tribal Facilities and Organizations; Costs Reporting and Provider Requirements; Agreement Termination Notices. The final rule revises the Medicare hospital inpatient prospective payment systems (IPPS) for operating and capital-related costs of acute care hospitals to implement changes arising from our continuing experience with these systems for FY 2018. Some of these changes implement certain statutory provisions contained in the Pathway for Sustainable Growth Rate (SGR) Reform Act of 2013, the Improving Medicare Post-Acute Care Transformation Act of 2014, the Medicare Access and CHIP Reauthorization Act of 2015, the 21st Century Cures Act, and other legislation. CMS is also making changes relating to the provider-based status of Indian Health Service (HIS) and Tribal facilities and organizations and to the low-volume hospital payment adjustment for hospitals operated by the IHS or a Tribe. In addition, CMS is providing the market basket update that will apply to the rate-of-increase limits for certain hospitals excluded from the IPPS that are paid on a reasonable cost basis subject to these limits for FY 2018. CMS is updating the payment policies and the annual payment rates for the Medicare prospective payment system (PPS) for inpatient hospital services provided by long-term care hospitals (LTCHs) for FY 2018. In addition, CMS is establishing new requirements or revising existing requirements for quality reporting by specific Medicare providers (acute care hospitals, PPS-exempt cancer hospitals, LTCHs, and inpatient psychiatric facilities). CMS is also establishing new requirements or revising existing requirements for eligible professionals (EPs), eligible hospitals, and critical access hospitals (CAHs) participating in the Medicare and Medicaid Electronic Health Record (EHR) Incentive Programs. We are updating policies relating to the Hospital Value-Based Purchasing (VBP) Program, the Hospital Readmissions Reduction Program, and the Hospital-Acquired Condition (HAC) Reduction Program.
• On August 2, 2017, CMS issued a notice entitled, Medicare Program; FY 2018 Inpatient Psychiatric Facilities Prospective Payment System – Rate Update. The notice with comment period updates the prospective payment rates for Medicare inpatient hospital services provided by inpatient psychiatric facilities (IPFs), which include freestanding IPFs and psychiatric units of an acute care hospital or critical access hospital. These changes are applicable to IPF discharges occurring during the fiscal year (FY) beginning October 1, 2017 through September 30, 2018 (FY 2018). Comments are due by October 6, 2017.
• On August 3, 2017, CMS issued a notice entitled, Medicare and Medicaid Programs; Quarterly Listing of Program Issuances— April through June 2017. The quarterly notice lists CMS manual instructions, substantive and interpretive regulations, and other Federal Register notices that were published from April through June 2017, relating to the Medicare and Medicaid programs and other programs administered by CMS.
• On August 3, 2017, the Drug Enforcement Agency (DEA) issued a notice entitled, Proposed Adjustments to the Aggregate Production Quotas for Schedule I and II Controlled Substances and Assessment of Annual Needs for the List I Chemicals Ephedrine, Pseudoephedrine, and Phenylpropanolamine for 2017. The notice announces that the DEA proposes to adjust the 2017 aggregate production quotas for several controlled substances in schedules I and II of the Controlled Substances Act and assessment of annual needs for the list I chemicals ephedrine, pseudoephedrine, and phenylpropanolamine. Comments are due by September 5, 2017.
• On August 4, 2017, the NIH issued a notice entitled, Prospective Grant of Exclusive Patent License: The Development of a Bispecific, Biparatopic Antibody-Drug Conjugate to GPC3 for the Treatment of Human Liver Cancers. The notice announces that the National Cancer Institute, NIH, HHS, is contemplating the grant of an Exclusive Patent License to Salubris Biotherapeutics, Inc. (Salubris), located in Gaithersburg, Maryland, to practice the inventions embodied in the patent applications listed in the Supplementary Information section of the notice. Comments are due by August 22, 2017.
• On August 4, 2017, the NIH issued a notice entitled, Prospective Grant of Exclusive Patent License: MicroRNA Therapeutics for Treating Squamous Cell Carcinomas. The notice announces that the National Heart, Lung and Blood Institute (NHLBI), NIH, HHS, is contemplating the grant of an Exclusive Patent License to MiRecule, Inc., located in Rockville, Maryland, to practice the inventions embodied in the patent applications listed in the Supplementary Information section of the notice.
• On August 4, 2017, the FDA issued final product-specific guidances. The guidances provide product-specific recommendations on, among other things, the design of bioequivalence (BE) studies to support abbreviated new drug applications (ANDAs). In the Federal Register of June 11, 2010, the FDA announced the availability of a guidance for industry entitled “Bioequivalence Recommendations for Specific Products” that explained the process that would be used to make product-specific BE recommendations available to the public on FDA’s website. The product-specific guidances identified in this notice were developed using the process described in that guidance. Comments may be submitted at any time.
• On August 4, 2017, the Health Resources and Services Administration (HRSA) issued a notice entitled, National Vaccine Injury Compensation Program List of Petitions Received. The notice publishes the petitions received under the National Vaccine Injury Compensation Program (the program), as required by the Public Health Service (PHS) Act, as amended. While the Secretary of HHS is named as the respondent in all proceedings brought by the filing of petitions for compensation under the Program, the United States Court of Federal Claims is charged by statute with responsibility for considering and acting upon the petitions.

• August 10, 2017: The Substance Abuse and Mental Health Services Administration (SAMHSA) announced a meeting of the Advisory Committee for Women’s Services (ACWS). The meeting will include discussions on the role of SAMHSA’s Office of the Chief Medical Officer and emerging issues for women; a follow-up discussion on the Office of Women’s Health Report on Women and Opioids; the invisibility of American Indian/American Native women; Legislative updates, including the Cures Act and the Comprehensive Addiction Recovery Act; and a conversation with the Deputy Assistant Secretary for Mental Health and Substance Use.
• August 23, 2017: The FDA announced it will hold a webinar to provide stakeholders with a status update on the process of the FDA and industry discussions on an Over-the-Counter (OTC) Monograph user fee program that began in July 2016. The FDA will also provide an overview of proposed performance goals and procedures related to a potential new OTC monograph user fee program.
• August 30, 2017: HHS announced a meeting of the Presidential Advisory Council on HIV/AIDS. The Council will discuss recommendations regarding programs, policies, and research to promote effective, prevention, treatment and cure of HIV disease and AIDS.
• September 6, 2017: The NIH announced meetings National Diabetes and Digestive and Kidney Diseases Advisory Council.
• September 6 – 7: 2017: HHS announced the next meeting of the Secretary’s Advisory Committee on National Health Promotion and Disease Prevention Objectives for 2030 (Committee). The meeting agenda will include (a) opportunity for the public to give oral testimony, (b) review of Committee work since the last public meeting, and (c) plans for future Committee work.
• September 7, 2017: HHS announced that the National Advisory Committee on Children and Disasters (NACCD) will hold a public meeting. The NACCD public meeting on September 7, 2017, is dedicated to the deliberation and vote on the Human Services Working Group Report.
• September 8, 2017: The NIH announced a meeting of National Institute of Minority Health and Health Disparities. The agenda will include administrative matters, Director’s report, NIH Health Disparities update, and other business of the Council.
• September 8, 2017: HHS announced a meeting of the Advisory Commission on Childhood Vaccines (ACCV). The agenda items for the meeting will include, but are not limited to, updates from the Division of Injury Compensation Programs, Department of Justice, National Vaccine Program Office, Immunization Safety Office (Centers for Disease Control and Prevention), National Institute of Allergy and Infectious Diseases (National Institutes of Health) and Center for Biologics, Evaluation and Research (Food and Drug Administration).
• September 12, 2017: The NIH announced a meeting on the Fogarty International Center. The meeting will provide an update on current and planned Fogarty International Center activities.
• September 13, 2017: The FDA announced a public advisory committee meeting of the Vaccines and Related Biological Products Advisory Committee (VRBPAC). On September 13, 2017, the VRBPAC will meet in an open session to discuss and make recommendations on the safety and effectiveness of Zoster Vaccine Recombinant, Adjuvanted, manufactured by GlaxoSmithKline Biologicals.
• September 14, 2017: The NIH announced a meeting of the National Advisory Child Health and Human Development Council. The agenda will include opening remarks, administrative matters, Director’s Report, Division of Extramural Research Report and, other business of the Council.
• September 19, 2017: The FDA announced a public advisory committee meeting of the Oncologic Drugs Advisory Committee. The committee will discuss supplemental new drug application (sNDA) 021938/033 SUTENT (sunitinib malate) oral capsules, submitted by C.P. Pharmaceuticals International C.V., represented by Pfizer, Inc. (authorized U.S. agent). The proposed indication (use) for this product is for the adjuvant treatment of adult patients at high risk of recurrent renal cell carcinoma following nephrectomy.
• September 27, 2017: The NIH announced a meeting of the National Institute of Aging. The meeting will focus around reports from the Task Force on Minority Aging Research, Working Group on Program, Council Speaker and program highlights.

II. Congressional Legislation & Committee Action

• On August 2, 2017, the Senate Health, Education, Labor and Pensions (HELP) Committee held a hearing on the nominations of Lance Robertson to be Assistant HHS Secretary for Aging; Brett Giroir to be Assistant HHS Secretary for Health; Robert Kadlec to be Assistant HHS Secretary for Preparedness and Response; Elinore McCance-Katz to be Assistant HHS Secretary for Mental Health and Substance Use; and Jerome Adams to be Medical Director in the Regular Corps of the Public Health Service and to be Surgeon General of the Public Health Service.
• On August 3, 2017, the Senate passedR. 2430, the FDA Reauthorization Act of 2017 by a vote of 99-1. The lone Senator not to vote for the legislation was Sen. Bernie Sanders (I-VT).

• The House of Representatives has adjourned and will reconvene on September 5, 2017.

• On July 31, 2017, the Congressional Budget Office (CBO) released a cost estimate of S. 469, the Affordable and Safe Prescription Drug Importation Act. The table for the changes in direct spending and revenues can be accessed here.
• On August 1, 2017, the CBO released a cost estimate of S. 870, the Creating High-Quality Results and Outcomes Necessary to Improve Chronic (CHRONIC) Care Act of 2017. The CBO estimates that enacting S. 870 would not affect direct spending in fiscal year 2018; would reduce direct spending for the Medicare and Medicaid programs by $217 million over the 2018-2022 period; and would have no significant effect on total direct spending over the 2018-2027 period. Pay-as-you-go procedures apply because enacting S. 870 would affect direct spending. Enacting the bill would not affect revenues. The CBO also estimates that enacting the legislation would not increase net direct spending or on-budget deficits by more than $5 billion in any of the four consecutive 10-year periods beginning in 2028.

IV. Other Health Policy News

• On July 31, 2017, CMS issued an informational bulletin entitled, Medical Loss Ratio (MLR) Credibility Adjustments. The bulletin discusses the MLR credibility adjustments and the methodology. Additionally, the bulletin notes that Medicaid and CHIP managed care plans must submit an MLR report to the state in a timeframe and manner determined by the state, which must be within 12 months of the end of the MLR reporting year.
• On July 31, 2017, CMS issued an informational bulletin entitled, Promoting Access in Medicaid and CHIP Managed Care: Strategies for Ensuring Provider Network Adequacy and Service Availability. The bulletin notes that CMS formed a working group of states to discuss common access challenges and goals, as well as to create a forum for states to present their successful techniques for establishing and monitoring network adequacy in their programs. According to CMS, the product of the group’s efforts is a compilation of effective and promising network adequacy and service availability strategies and analysis techniques, as well as valuable data sources that states are using to develop and assess the availability of providers and services in their states. The toolkit can be accessed here.
• On August 2, 2017, CMS issued a State Medicaid Director letter entitled, Implications of the Cures Act for Special Needs Trusts. The letter provides guidance to states on the implications of section 5007 of the Cures Act, entitled “Fairness in Medicaid Supplemental Needs Trusts,” for individuals who have disabilities.
• On August 2, 2017, CMS posted an update to the Health Insurance Exchanges Issuer County Map. The map is of projected issuer participation on the Health Insurance Exchanges in 2018 based on the known issuer public announcements through August 2, 2017. According to CMS, participation is expected to fluctuate and does not represent actual Exchange application submissions.
• On August 2, 2017, CMS announced that the average basic premium for a Medicare Part D prescription drug plan in 2018 is projected to decline to an estimated $33.50 per month. According to CMS, this represents a decrease of approximately $1.20 below the actual average premium of $34.70 in 2017.
• On August 3, 2017, CMS announced that it approved a five-year extension of Florida’s Managed Medical Assistance (MMA) section 1115 demonstration that allows the state to operate a capitated Medicaid managed care program and a low-income pool (LIP) to provide continuing support for the safety net providers that furnish charity care to the uninsured.

V. ACA Repeal News

• On August 1, 2017, Senate HELP Committee Chairman Lamar Alexander (R-TN) said that beginning in September, the HELP Committee will begin to hold bipartisan hearings on short-term stabilization of the ACA’s individual market.