Below is Alston & Bird’s Health Care Week in Review, which provides a synopsis of the latest news in healthcare regulations, notices, and guidance; federal legislation and congressional committee action; reports, studies, and analyses; and other health policy news.
Week in Review Highlight of the Week:
This week, CMS released its 2021 and 2022 Medicare Advantage and Part D Proposed Rule, while competing surprise billing proposals were unveiled in the U.S. House of Representatives. Read more about these events and other news below.
I. Regulations, Notices, & Guidance
- On February 3, 2020, the Food and Drug Administration (FDA) issued guidance entitled, Promotional Labeling and Advertising Considerations for Prescription Biological Reference and Biosimilar Products—Questions and Answers. FDA is issuing this guidance to provide manufacturers, packers, distributors, and their representatives (firms) with information to consider when developing FDA-regulated promotional labeling and advertisements (promotional materials) for prescription reference and biosimilar products licensed under the Public Health Service Act (PHS Act). Although the guidance covers promotional issues involving both reference and biosimilar products, some questions and answers are focused on only biosimilar product promotional materials. The guidance does not discuss considerations unique to promotional materials for interchangeable biosimilars.
- On February 4, 2020, FDA issued guidance entitled, Mucopolysaccharidosis Type III (Sanfilippo Syndrome): Developing Drugs for Treatment. The purpose of this draft guidance is to foster greater efficiency in drug development in this rare disease with the goal of enhancing clinical trial data quality and supporting the development of treatments for mucopolysaccharidosis type III. Specifically, the draft guidance provides the FDA’s current recommendations regarding eligibility criteria, trial design considerations, and efficacy endpoints for use in clinical development programs of investigational drugs to treat mucopolysaccharidosis type III.
- On February 5, 2020, FDA issued guidance entitled, Use of Serological Tests to Reduce the Risk of Transfusion-Transmitted Human T-Lymphotropic Virus Types I and II. This guidance document provides blood collection establishments with recommendations regarding the use of serological tests to reduce the risk of HTLV-I/II transmission by blood and blood components. The guidance announced in this notice finalizes the draft guidance entitled “Recommendations for Requalification of Blood Donors Deferred Because of Reactive Test Results for Antibodies to Human T-Lymphotropic Virus Types I and II (anti-HTLV-I/II)” dated September 2018. The guidance also consolidates FDA’s other previously issued recommendations on HTLV-I/II into one document.
- On February 6, 2020, the Centers for Medicare & Medicaid Services (CMS) issued a proposed rule entitled, Contract Year 2021 and 2022 Policy and Technical Changes to the Medicare Advantage Program, Medicare Prescription Drug Benefit Program, Medicaid Program, Medicare Cost Plan Program, and Programs of All-Inclusive Care for the Elderly. This proposed rule would revise regulations for the Medicare Advantage (Part C) program, Medicare Prescription Drug Benefit (Part D) program, Medicaid program, Medicare Cost Plan program, and Programs of All-Inclusive Care for the Elderly to implement certain sections of the Bipartisan Budget Act of 2018, the Substance Use-Disorder Prevention that Promotes Opioid Recovery and Treatment for Patients and Communities Act, and the 21st Century Cures Act. This proposed rule would also enhance the Part C and D programs, codify several existing CMS policies, and implement other technical changes. The CMS fact sheet on the proposed rule can be found here.
- On February 6, 2020, CMS issued Part II of the Calendar Year (CY) 2021 Advance Notice of Methodological Changes for Medicare Advantage (MA) Capitation Rates and Part C and Part D Payment Policies. Through the CY 2021 Advance Notice, CMS is proposing updates and changes to the methodologies used to pay Medicare Advantage plans, Programs of All-Inclusive Care for the Elderly, and Part D sponsors. CMS will not be publishing a Call Letter for 2021. CMS is proposing to codify much of the guidance typically included in the annual Call Letter through the CY 2021 and 2022 MA and Part D Proposed Rule. CMS will also separately issue Part C and Part D bidding instructions and information previously provided through the Call Letter. The CMS fact sheet on the Advance Notice can be found here.
- On February 6, 2020, FDA issued a rule entitled, Medical Devices: Immunology and Microbiology Devices; Classification of Human Immunodeficiency Virus Drug Resistance Genotyping Assay Using Next Generation Sequencing Technology. FDA is classifying the human immunodeficiency virus (HIV) drug resistance genotyping assay using next generation sequencing (NGS) technology into class II (special controls). The special controls that apply to the device type are identified in this order and will be part of the codified language for the HIV drug resistance genotyping assay using NGS technology’s classification. FDA is taking this action because they have determined that classifying the device into class II (special controls) will provide a reasonable assurance of safety and effectiveness of the device. FDA believes this action will also enhance patients’ access to beneficial innovative devices, in part by reducing regulatory burdens.
- On February 6, 2020, FDA issued guidance entitled, Biosimilars and Interchangeable Biosimilars: Licensure for Fewer than All Conditions of Use for Which the Reference Product Has Been Licensed. This draft guidance will provide recommendations to applicants seeking licensure under the Public Health Service Act of a proposed biosimilar or proposed interchangeable biosimilar for fewer than all of the reference product’s licensed conditions of use. Additionally, when finalized, this draft guidance will also provide recommendations on the submission of a supplement to a licensed biologics license application seeking to add a condition of use that previously has been licensed for the reference product to the labeling of a licensed biosimilar or interchangeable product, including considerations related to the timing of such submissions.
- On February 7, 2020, CMS issued a proposed rule entitled, Basic Health Program; Federal Funding Methodology for Program Year 2021. This document proposes the methodology and data sources necessary to determine federal payment amounts to be made for program year 2021 to states that elect to establish a Basic Health Program under the Affordable Care Act to offer health benefits coverage to low-income individuals otherwise eligible to purchase coverage through Affordable Insurance Exchanges.
- On February 7, 2020, the Centers for Disease Control and Prevention (CD) issued an interim final rule entitled, Control of Communicable Diseases; Foreign Quarantine. This interim final rule is intended to amend the CDC’s Foreign Quarantine regulations, to enable CDC to require airlines to collect, and provide to CDC certain data regarding passengers and crew arriving from foreign countries for the purposes of health education, treatment, prophylaxis, or other appropriate public health interventions, including travel restrictions.
- On February 7, 2020, CMS issued a rule entitled, Update to the Required Prior Authorization List of Durable Medical Equipment, Prosthetics, Orthotics, and Supplies Items That Require Prior Authorization as a Condition of Payment. This document announces the continuation of prior authorization for 45 Healthcare Common Procedure Coding System (HCPCS) codes on the Required Prior Authorization List of DMEPOS Items that require prior authorization as a condition of payment, as well as the addition of six HCPCS codes to this list. Prior authorization for the additional codes will be implemented in two phases.
- February 12, 2020: CDC announced a public meeting entitled, Meeting of the Community Preventive Services Task Force (CPSTF). During the afternoon session, the CPSTF will deliberate on systematic reviews of literature related to the following: HIV Prevention: Clinical Decision Support Systems to Increase HIV Screening; Cardiovascular Disease Prevention and Control: Economics of Pharmacy-Based Interventions to Increase Medication Adherence; and one or more proposals for new reviews in the areas of mental health, sleep health, tobacco prevention and control.
- February 13-14, 2020: The Department of Health and Human Services (HHS) announced a public meeting entitled, Meeting of the National Vaccine Advisory Committee. During the February 2020 meeting, sessions will focus on vaccine innovation and vaccine confidence with updates from subcommittees and members.
- February 24, 2020: FDA announced a public meeting entitled, Rare Disease Day 2020: Supporting the Future of Rare Disease Product Development. The goal of this meeting is to obtain stakeholders' perspectives on challenges and solutions in rare disease product development and identify commonalities that can support product development across a variety of rare diseases.
- February 26, 2020: FDA announced a public meeting entitled, Oncologic Drugs Advisory Committee. During the morning session, the committee will discuss new drug application 212578 for padeliporfin di-potassium powder for solution for injection, submitted by STEBA Biotech, S.A. The proposed indication (use) for this product is for the treatment of patients with localized prostate cancer. During the afternoon session, the committee will discuss supplemental biologics license application 125477/S-034, for CYRAMZA (ramucirumab) injection for intravenous use, submitted by Eli Lilly and Company. The proposed indication (use) for this product is in combination with erlotinib, for first-line treatment of patients with metastatic non-small cell lung cancer whose tumors have epidermal growth factor receptor exon 19 deletions or exon 21 (L858R) substitution mutations.
- March 2-4, 2020: The Health Resources and Services Administration (HRSA) announced a public meeting entitled, National Advisory Committee on Rural Health and Human Services (NACRHHS). NACRHHS provides advice and recommendations to the Secretary of HHS on policy, program development, and other matters of significance concerning both rural health and rural human services.
- March 4, 2020: FDA announced a public meeting entitled, Vaccines and Related Biological Products Advisory Committee. The committee will discuss and make recommendations on the selection of strains to be included in the influenza virus vaccines for the 2020 to 2021 influenza season. Also, on March 4, 2020, under Topic II, the committee will meet in open session to hear an overview of the research programs in the Laboratory of Respiratory and Special Pathogens, Division of Bacterial, Parasitic, and Allergenic Products, Office of Vaccines Research and Review, CBER.
- March 9, 2020: FDA and the Federal Trade Commission (FTC) announced a public workshop entitled, Workshop on a Competitive Marketplace for Biosimilars. The purpose of the public workshop is to discuss FDA and FTC's collaborative efforts to support appropriate adoption of biosimilars, discourage false or misleading communications about biosimilars, and deter anticompetitive behaviors in the biologic product marketplace.
II. Congressional Hearings
House of Representatives
- On February 5, 2020, the House Committee on Energy and Commerce Subcommittee on Oversight and Investigations held a hearing entitled, Vaping in America: E-Cigarette Manufacturers. Witnesses present included: K.C. Crosthwaite, CEO, JUUL Labs, Inc.; Ricardo Oberlander, President & CEO, Reynolds American Inc.; Ryan Nivakoff, CEO, NJOY, LLC; Antoine Blonde, President, Fontem U.S.; and Jerry Loftin, President, Logic Technology Development, LLC.
- On February 5, 2020, the House Committee on Foreign Affairs held a hearing entitled, The Wuhan Coronavirus: Assessing the Outbreak, the Response, and Regional Implications. Witnesses present included: Jennifer Nuzzo, Ph.D., Associate Professor and Senior Scholar, Center for Health Security, Johns Hopkins University; Jennifer Bouey, Ph.D., Senior Policy Researcher and Tang Chair in China Policy Studies, RAND Corporation; and Ron Klain, Former White House Ebola Response Coordinator, 2014-2015.
- On February 5, 2020, the House Committee on Ways and Means Subcommittee on Health held a hearing entitled, More Cures for More Patients: Overcoming Pharmaceutical Barriers. Witnesses present included: Aaron S. Kesselheim, MD, JD, MPH, Professor of Medicine, Harvard Medical School/Brigham and Women’s Hospital; Brad W. Setser, Senior Fellow for International Economics, Council on Foreign Relations (CFR); Ge Bai, PhD, CPA, Associate Professor of Accounting, Johns Hopkins Carey Business School; Juliana Keeping, Patient Advocate; and Tara O’Neill Hayes, Director of Human Welfare Policy, American Action Forum.
III. Reports, Studies, & Analyses
- On February 5, 2020, the Bipartisan Policy Center (BPC) published a report entitled, Bipartisan Rx for America’s Health Care. Today, most national polls—including BPC’s survey—show a majority of Americans believe individuals and families pay too much for their health care and health care is a top concern in the 2020 presidential election. This report is a multifaceted policy prescription for reforming America’s current health care system. It includes recommendations for congressional action that target excessive costs in the private insurance market, Medicare, and Medicaid, and anti-competitive behavior by some pharmaceutical manufacturers and health systems, which is occurring as a result of increasing hospital consolidations.
- On February 5, 2020, Kaiser Family Foundation published an issue brief entitled, Implications of CMS’s New “Healthy Adult Opportunity” Demonstrations for Medicaid. On January 30, 2020, the Centers for Medicare and Medicaid Services (CMS) released guidance inviting states to apply for new Section 1115 demonstrations known as the “Healthy Adult Opportunity” (HAO). These demonstrations would permit states the flexibility to use Medicaid funds to cover Affordable Care Act expansion adults and other nonelderly adults covered at state option who do not qualify on the basis of disability, without being bound by many federal standards related to Medicaid eligibility, benefits, delivery systems, and program oversight. In exchange, states would agree to a limit on federal financing in the form of a per capita or aggregate cap. States that opt for the aggregate cap and meet performance standards could access a portion of federal savings if actual spending is under the cap. This report summarizes and analyzes the key provisions of the HAO demonstrations.
- On February 6, 2020, HHS published its 2019 Annual Report. The report highlights the department’s accomplishments from 2019 and is organized into five sections corresponding to the HHS’ strategic goals, as laid out in their 2018-2022 strategic plan. These goals include the following: (1) reform, strengthen, and modernize the nation’s health care system; (2) protect the health and well-being of Americans where they live, learn, work, and play; (3) strengthen the economic and social well-being of Americans across the lifespan; (4) foster sound, sustained advances in the sciences; and (5) promote effective and efficient management and stewardship.
IV. Other Health Policy News
- On February 4, 2020, President Donald Trump delivered the State of the Union Address. President Trump’s remarks included pledges to guarantee coverage for patients with pre-existing conditions and protect Medicare. He also highlighted the action his administration has taken over the past year to address the high cost of prescription drugs. He mentioned the proposed importation rule, and he stated that the administration approved a record number of affordable generic drugs in 2019—which marks the third consecutive year of doing so. President Trump said thanks to these measures, the cost of prescription drugs decreased in 2019. However, he emphasized the need to do more and he pledged to sign legislation to dramatically lower prescription drug prices if Congress would get bipartisan legislation on his desk. President Trump also announced $50 million in new funding for neonatal research and noted his administration’s initiatives on fighting Alzheimer’s, kidney and HIV disease. The full text of the speech is available here.
- On February 6, 2020, CMS took steps to prepare for the 2019-Novel Coronavirus threat by issuing two memoranda to advise health care providers and State Survey Agencies (SAs)—the entities that inspect healthcare facilities to ensure compliance with current CMS requirements and safety standards—with important information about infection control procedures and the use of certain laboratory tests. The first memo provides information on infection control policies and practices. In addition, CMS urges SAs and health care facilities to review the information provided by the CDC to aid in self-assessment of infection control and emergency preparedness protocols. The memo also provides links to training and self-assessment tools for facilities to use as they review their processes and, if necessary, improve their practices. The second memo provides guidance to support the issuance of the Emergency Use Authorization released by FDA on February 4 for CDC-approved laboratory tests to identify the presence of Coronavirus in patients. The memo is intended to help surveyors confirm that all CLIA-certified laboratories are following protocols to ensure accurate testing and patient safety.
- On February 7, 2020, two committees in the U.S. House of Representatives released competing proposals to address the issue of surprise billing. The House Committee on Ways and Means proposal, entitled the Consumer Protections Against Surprise Medical Bills Act, would begin in 2022 and would require insurers and providers to enter a 30-day negotiation period before moving to arbitration. The arbiter would consider median in-network charges and would be prohibited from considering billed charges or usual and customary charges. A section-by-section summary of the bill is available here. The House Committee on Education and Labor proposal, entitled the Ban Surprise Billing Act, would use a benchmark payment rate for out-of-network charges and then allow providers and payers to move to arbitration for charges above $750 if they elect to do so. A fact sheet on the bill is available here. The House Committee on Education and Labor has scheduled a markup of the Ban Surprise Billing Act for February 11, 2020, and the House Committee on Ways and Means has scheduled a markup of the Consumer Protections Against Surprise Medical Bills Act for February 12, 2020.