General Publications August 3, 2018

Alston & Bird Healthcare Week in Review, August 3, 2018

Alston & Bird’s Week in Review provides a synopsis of the latest news in health care regulations, notices, and guidance; federal legislation and Congressional committee action; reports, studies, and analyses; and other health policy news.

I. Regulations, Notices, & Guidance

  • On July 31, 2018, the Centers for Medicare and Medicaid Services (CMS) issued a final rule entitled, Prospective Payment System and Consolidated Billing for Skilled Nursing Facilities Final Rule for FY 2019, SNF Value-Based Purchasing Program, and SNF Quality Reporting Program. This final rule updates the payment rates used under the prospective payment system (PPS) for skilled nursing facilities (SNFs) for fiscal year (FY) 2019. This final rule also replaces the existing case-mix classification methodology, the Resource Utilization Groups, Version IV model, with a revised case-mix methodology called the Patient-Driven Payment Model beginning on October 1, 2019. The rule finalizes revisions to the regulation text that describes a beneficiary’s SNF “resident” status under the consolidated billing provision and the required content of the SNF level of care certification. The rule also finalizes updates to the SNF Quality Reporting Program and the Skilled Nursing Facility Value-Based Purchasing Program.
  • On July 31, 2018, CMS issued a final rule entitled, Inpatient Rehabilitation Facility Prospective Payment System for Federal Fiscal Year 2019. This final rule updates the prospective payment rates for inpatient rehabilitation facilities (IRFs) for FY 2019. As required by the Social Security Act (the Act), this final rule includes the classification and weighting factors for the IRF prospective payment system’s case-mix groups and a description of the methodologies and data used in computing the prospective payment rates for FY 2019. This final rule also alleviates administrative burden for IRFs by removing the Functional Independence Measure instrument and associated Function Modifiers from the IRF Patient Assessment Instrument (IRF-PAI) beginning in FY 2020 and revises certain IRF coverage requirements to reduce the amount of required paperwork in the IRF setting beginning in FY 2019. Additionally, this final rule incorporates certain data items located in the Quality Indicators section of the IRF-PAI into the IRF case-mix classification system using analysis of 2 years of data beginning in FY 2020. For the IRF Quality Reporting Program (QRP), this final rule adopts a new measure removal factor, removes two measures from the IRF QRP measure set, and codifies a number of program requirements in our regulations.
  • On July 31, 2018, CMS issued a final rule entitled, FY 2019 Inpatient Psychiatric Facilities Prospective Payment System and Quality Reporting Updates for Fiscal Year Beginning October 1, 2018 (FY 2019).  This final rule updates the prospective payment rates for Medicare inpatient hospital services provided by inpatient psychiatric facilities (IPFs), which include psychiatric hospitals and excluded psychiatric units of an acute care hospital or critical access hospital. These changes are effective for IPF discharges occurring during the fiscal year beginning October 1, 2018 through September 30, 2019 (FY 2019). This final rule also updates the IPF labor-related share, the IPF wage index for FY 2019, and the International Classification of Diseases 10th Revision, Clinical Modification codes for FY 2019. It also makes technical corrections to the IPF regulations, and updates quality measures and reporting requirements under the Inpatient Psychiatric Facility Quality Reporting Program. In addition, it updates providers on the status of IPF PPS refinements.
  • On August 1, 2018, the Department of Health and Human Services (HHS) issued a final rule entitled, Short-Term, Limited-Duration Insurance. This final rule amends the definition of short-term, limited-duration insurance for purposes of its exclusion from the definition of individual health insurance coverage. This action is being taken to lengthen the maximum duration of short-term, limited-duration insurance, which according to HHS, will provide more affordable consumer choices for health coverage.
  • On August 2, 2018, CMS issued a final rule entitled, Hospital Inpatient Prospective Payment Systems for Acute Care Hospitals and the Long Term Care Hospital Prospective Payment System and Policy Changes and Fiscal Year 2019 Rates; Quality Reporting Requirements for Specific Providers; Medicare and Medicaid Electronic Health Record (EHR) Incentive Programs (Promoting Interoperability Programs) Requirements for Eligible Hospitals, Critical Access Hospitals, and Eligible Professionals; Medicare Cost Reporting Requirements; and Physician Certification and Recertification of Claims. CMS is revising the Medicare hospital inpatient prospective payment systems (IPPS) for operating and capital-related costs of acute care hospitals to implement changes arising from CMS’ continuing experience with these systems for FY 2019. Some of these changes implement certain statutory provisions contained in the 21st Century Cures Act and the Bipartisan Budget Act of 2018, and other legislation. CMS is also making changes relating to Medicare graduate medical education (GME) affiliation agreements for new urban teaching hospitals. 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 2019. 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 2019. 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, and LTCHs). CMS is also establishing new requirements or revising existing requirements for eligible professionals, eligible hospitals, and critical access hospitals participating in the Medicare and Medicaid Electronic Health Record (EHR) Incentive Programs (now referred to as the Promoting Interoperability Programs). In addition, CMS is finalizing modifications to the requirements that apply to States operating Medicaid Promoting Interoperability Programs. CMS is updating policies for the Hospital Value-Based Purchasing Program, the Hospital Readmissions Reduction Program, and the Hospital-Acquired Condition Reduction Program. CMS is also making changes relating to the required supporting documentation for an acceptable Medicare cost report submission and the supporting information for physician certification and recertification of claims.
Event Notices
  • August 3, 2018: The FDA announced a meeting of the Drug Safety and Risk Management Advisory Committee and the Anesthetic and Analgesic Drug Products Advisory Committee. The committees will discuss results from assessments of the transmucosal immediate-release fentanyl medicines’ risk evaluation and mitigation strategy.
  • August 20, 2018: The CMS announced the annual meeting of the Advisory Panel on Hospital Outpatient Payment (the Panel) for 2018. The purpose of the Panel is to advise the HHS Secretary on the clinical integrity of the Ambulatory Payment Classification groups and their associated weights as well as hospital outpatient therapeutic services supervision issues.
  • August 21, 2018: The FDA announced a public work shop entitled, Development of Non-Traditional Therapies for Bacterial Infections. The purpose of the workshop is to discuss the general development considerations of non-traditional therapies, including pre-clinical development, early clinical studies, and phase 3 clinical trial designs to evaluate safety and efficacy.
  • September 4, 2018: the FDA announced a public hearing on FDA’s approach to enhancing competition and innovation in the biological products marketplace, including by facilitating greater availability of biosimilar and interchangeable products.
  • September 12, 2018: The FDA announced a public hearing to solicit comments on FDA’s Predictive Toxicology Roadmap, which was issued by FDA on December 6, 2017. FDA is seeking comments on how to foster the development and evaluation of emerging toxicological methods and new technologies and incorporate these methods and technologies into regulatory review.
  • September 12, 2018: The FDA announced a public meeting of the Pharmacy Compounding Advisory Committee (PCAC). The PCAC will receive information on balancing the criteria for the 503A bulk drug substance evaluation and compounding as it relates to dietary supplements.
  • September 28, 2018: the FDA announced a conference entitled, Scientific Conference: Opioid and Nicotine Use, Dependence, and Recovery – Influences of Sex and Gender. The purpose of the conference is to discuss the biological and sociological influences on misuse, abuse, and cessation of opioids and tobacco.

II. Congressional Legislation & Committee Action

U.S. Senate  
  • On July 31, 2018, the Senate Committee on Health, Education, Labor, and Pensions held a hearing entitled, Reducing Health Care Costs: Decreasing Administrative Spending. Witnesses present included: Becky Hultberg, President and Chief Executive Officer, Alaska State Hospital & Nursing Home Association; Matt Eyles, President and Chief Executive Officer, America’s Health Insurance Plans; David Cutler, Ph.D, Harvard College Professor; and Robert Book, Ph.D., Health Care and Economic Expert Advisor, American Action Forum.
House of Representatives
  • No health-related hearings this week.

III. Reports, Studies, & Analyses

IV. Other Health Policy News

  • On August 1, 2018, the California Insurance Commissioner sent a letter to the Department of Justice stating the CVS-Aetna merger will have anti-competitive effects and hurt consumers. The letter is available here.
Media Contact
Nicholas Clarke
Senior Communications Manager
Phone: 212.210.1222
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