Health Care Week in Review: Additional Midterm Election Results Confirm the Republican Party's Majority in the House of Representatives

Below is Alston & Bird’s Health Care Week in Review, which 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.

Week in Review Highlight of the Week:

This week, additional midterm election results confirm the Republican party's majority in the House of Representatives and the Democratic party's majority in the Senate. Read more about these actions and other news below.

I. Regulations, Notices & Guidance

• On November 14, 2022, the Food and Drug Administration (FDA) issued final guidance entitled, Referencing the Definition of "Device" in the Federal Food, Drug, and Cosmetic Act in Guidance, Regulatory Documents, Communications, and Other Public Documents. FDA is issuing this guidance to clarify the agency’s approach for referencing the terms “device” and “counterfeit device” in FDA documents. For many years, the definition of “device” has been codified at section 201(h) of the Federal Food, Drug, and Cosmetic Act (FD&C Act). Upon the enactment of the Safeguarding Therapeutics Act in January 2021, the definition of device was redesignated to section 201(h)(1) of the FD&C Act, and the new term “counterfeit device” and its definition were designated at section 201(h)(2) of the FD&C Act. FDA is issuing this guidance to provide clarity on how it intends to reference the terms “device” and “counterfeit device” and how it intends to interpret existing references to section 201(h) of the FD&C Act, in guidance, regulatory documents, communications, and other public documents.

• On November 14, 2022, the Centers for Medicare & Medicaid Services (CMS) issued a notice entitled, Medicare Program; Request for Nominations to the Advisory Panel on Hospital Outpatient Payment. CMS is requesting nominations to fill vacancies on the Advisory Panel (the Panel) on Hospital Outpatient Payment (HOP). The purpose of the Panel is to advise the Secretary of the Department of Health and Human Services (the Secretary) (HHS) and the Administrator of CMS (the Administrator) on the clinical integrity of the Ambulatory Payment Classification (APC) groups and their associated weights, supervision of hospital outpatient therapeutic services, and hospital outpatient prospective payment system (OPPS) OPPS APC rates for covered ambulatory surgical centers (ASC) procedures. Nominations must be submitted by February 13, 2022.

• On November 14, 2022, HHS issued a notice entitled, Healthcare-Associated Infections National Action Plan Targets. HHS’ Office of Infectious Disease and HIV/AIDS Policy (OIDP) in the Office of the Assistant Secretary for Health (OASH) announces the draft targets for updating the Healthcare-Associated Infections (HAI) National Action Plan, Phase 1, Acute Care Hospitals, for public comment. The HHS Core Group of the HAI National Action Plan reviewed data pre-pandemic and between 2020 and 2021 and developed potential 5-year targets based on assumptions that current HAI rates should return to pre-pandemic baseline rates within 2 years or within 3 years when determining these 5-year targets. The HHS HAI NAP Core Group recommends 5-year targets assuming a return to prepandemic baseline rates within 3 years based on two fundamentals: (1) pandemic-related challenges will likely persist in upcoming years, and (2) the pandemic has caused major strains on the health care system which make a 3-year timeline to achieve pre-pandemic Standardized Infection Ratio (SIR) the most appropriate choice. Comments must be received by 5pm on January 13, 2023.

• On November 15, 2022, FDA issued a notice entitled, Safety and Effectiveness of Certain Naloxone Hydrochloride Drug Products for Nonprescription Use; Request for Comments. FDA is announcing its preliminary assessment that certain types of naloxone hydrochloride (“naloxone”) drug products may be approvable as safe and effective for nonprescription use. It is FDA’s preliminary opinion at this time that naloxone nasal spray up to 4 milligrams (mg), and naloxone autoinjector for intramuscular (IM) or subcutaneous (SC) use up to 2 mg, have the potential to be safe and effective for use as directed in nonprescription drug labeling without the supervision of a healthcare practitioner. The agency believes the prescription requirement for these naloxone products might not be necessary for the protection of the public health. However, FDA needs additional data such as product-specific data on the nonprescription user interface design, including packaging and labeling, to make a conclusive determination in this respect. The FD&C Act does not permit the simultaneous marketing of the same drug with the same active ingredient as both a prescription and nonprescription product, absent a clinically meaningful difference between them. Therefore, if and when FDA has sufficient data to support approval of a nonprescription naloxone product (e.g., through submission and approval of an application for a nonprescription naloxone product or a supplemental application to switch an FDA-approved naloxone product from prescription to nonprescription status), currently marketed naloxone products labeled as “Rx only” with no clinically meaningful difference from the approved nonprescription products will be considered misbranded. Comments must be submitted by January 15, 2022.

• On November 15, 2022, FDA issued draft guidance entitled, Product-Specific Guidances; Draft and Revised Draft Guidances for Industry; Availability. FDA is announcing the availability of additional draft and revised draft 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, 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 guidances available to the public on FDA’s website. The guidances identified in this notice were developed using the process described in that guidance.

• On November 18, 2022, the Centers for Disease Control and Prevention (CDC) issued a notice entitled, Clinical Practice Guideline for Prescribing Opioids for Pain--United States, 2022. This notice announces the availability of the CDC Clinical Practice Guideline for Prescribing Opioids for Pain—United States, 2022 (2022 Clinical Practice Guideline). The 2022 Clinical Practice Guideline updates and expands the CDC Guideline for Prescribing Opioids for Chronic Pain—United States, 2016 (2016 Guideline) and provides evidence-based recommendations for clinicians who provide pain care, including those prescribing opioids, for outpatients aged 18 years and older with: acute pain (duration less than 1 month), subacute pain (duration of 1-3 months), or chronic pain (duration of more than 3 months). The recommendations in the 2022 Clinical Practice Guideline do not apply to pain management related to sickle cell disease, cancer related pain treatment, palliative care, or end-of-life care. The 2022 Clinical Practice Guideline finalizes the draft clinical practice guideline issued on February 10, 2022.

• On November 18, 2022, HHS issued a notice entitled, Opportunity to Co-Sponsor Office of the Assistant Secretary for Health-Supported Grantee Workshops. The Grants and Acquisitions Management Division (GAM) in the Office of the Assistant Secretary for Health (OASH), in conjunction with the grant making program offices it supports, announced the opportunity for non-federal public and private sector entities to cosponsor OASH-supported grants workshops (OASH Grants Workshops). Potential co-sponsors must have a demonstrated interest and experience in building capacity among potential grant applicants and grant recipients. Potential co-sponsors must be willing to participate substantively in the co-sponsored activity. OASH intends to cosponsor a limited number of workshops with other entities each year. Expressions of interest are being received for OASH Grants Workshops that will take place in the next fiscal year (October 2022 through September 2023) or beyond.

• On November 18, 2022, HHS issued a notice entitled, Request for Information: National Public Health Strategy for the Prevention and Control of Vector-Borne Diseases in Humans. This Request for information (RFI) invites comments and suggestions on the National Strategy for the Prevention and Control of Vector-Borne Diseases. The Strategy represents the federal government’s priorities for addressing vector-borne disease (VBD) threats. Submissions must be received by December 21, 2022.

Event Notices

• December 5-6, 2022: The Health Resources and Services Administration (HRSA) announced a public meeting of the Secretary’s Advisory Council on Blood Stem Cell Transplantation (ACBSCT). ACBSCT will discuss the impact of COVID-19 on blood stem cell donation and transplantation; unmet needs in blood stem cell transplantation and cellular therapy; strategies to improve rates of adult blood stem donation; and other areas to increase blood stem cell donation and transplantation.

• December 7-8, 2022: CDC announced a meeting of the Board of Scientific Counselors, Deputy Director for Infectious Diseases (BSC, DDID). The agenda will include updates and discussions on recent outbreaks and affected populations, as well as brief reports from two of the Board’s workgroups: the Food Safety Modernization Act (FSMA) Surveillance Working Group and the Acute Flaccid Myelitis Task Force (AFM-TF).

II. Congressional Hearings

• On November 16, 2022, the Senate Special Committee on Aging held a hearing entitled, Setting the Table: Promoting Healthy and Affordable Food for Older Americans. Witnesses present included: Jeremy Everett, Founder and Executive Director, Baylor Collaborative on Hunger and Poverty; Dr. Temitope Walker, Senior Hunger Nutrition Coordinator, Georgia Department of Human Services; Tom Gilroy, Volunteer, East Cooper Community Outreach; and Barbara Myzick, Nutrition Program Participant, Luzerne County.

III. Reports, Studies & Analyses

• On November 14, 2022, HHS’ Office of Inspector General (OIG) published a report entitled, The Number of Beneficiaries Who Received Medicare Part B Clinical Laboratory Tests Decreased During the First 10 Months of the COVID-19 Pandemic. GAO launched this study to identify changes in the number of beneficiaries who received Medicare Part B lab tests (all lab tests or lab tests associated with certain chronic medical conditions such as diabetes) during the first 10 months of the COVID-19 pandemic. Compared to pre-pandemic times (March-December 2019), GAO found that the number of beneficiaries who received Medicare Part B lab tests decreased during the pandemic (March-December 2020). Specifically, GAO noted that: (1) the largest decrease in receiving lab tests occurred during the first three months of the pandemic; (2) the decreases were most often greater than 90 percent; (3) there were no differences in the decrease across gender and residential location of the beneficiary; and (4) the percent decrease varied across racial and ethnic groups, with the largest decrease among Hispanic or Latino beneficiaries and the smallest decrease among White beneficiaries.

• On November 15, 2022, the Kaiser Family Foundation’s (KFF’s) Kaiser Health News (KHN) published a story entitled, Sick Profit: Investigating Private Equity’s Stealthy Takeover of Health Care Across Cities and Specialties. KHN investigated the rapid growth in private equity investments into health care and found that such practices have led to higher costs of care and decreased quality of care for patients. For example, 34 lawsuits have been filed against companies owned or managed by private equity firms for false billing submissions under the False Claims Act since 2014, but most have been settled through fines, avoiding liability for private equity owners. Additionally, many patients and whistleblowers have alleged private equity firms or the companies they invested in have engaged in improper business conduct, such as by violating anti-kickback laws, cutting staff, or performing and billing for medically unnecessary services to boost their profits, which places patients at risk. KHN also found that private equity has done so much buying that it dominates several medical service markets, limiting patients’ access to health care services to private equity owned companies. Finally, KHN noted that current regulation requires mergers and acquisitions to be reported to the Federal Trade Commission (FTC) and Department of Justice (DOJ) for review if they are over $101 million – however, more than 90 percent of private equity takeovers or investments fall below that threshold.

• On November 15, 2022, CRS published a report entitled, Health Care-Related Expiring Provisions of the 117th Congress, Second Session. This report details health care provisions related to health insurance programs and activities, provisions in the Patient Protection and Affordable Care Act (ACA), and provisions in the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) that have expired or will expire during calendar year (CY) 2022. It discusses two types of health care provisions: (1) mandatory spending, meaning temporary funding, and (2) authorities of government agencies or other entities. These two types of provisions have generally been enacted through authorization laws and are under the purview of congressional committees through authorize. The report includes tables of expired or scheduled to expired provisions in CY 2022, expired provisions from CY 2021, and expired demonstration or pilot programs in CY 2021.

• On November 16, 2022, HHS OIG released a report entitled, 2022 Top Management & Performance Challenges Facing HHS. This annual publication identifies and details the top six management and performance challenges (TMCs) that HHS OIG faced related to oversight, enforcement, data analytics, risk analysis work, as well as operations and policies. The first TMC is entitled, safeguarding public health, and discusses recommendations given the department’s challenges resulting from the COVID-19 and monkeypox outbreaks, natural disasters, mental health and drug overdose crises, and more. The second TMC is entitled, ensuring the financial integrity of HHS programs, and discusses how HHS distributes its $2.9 billion budget across programs, grants, and contracts. The third TMC is entitled, delivering value, quality, and improve outcomes in CMS programs, and discusses challenges related to CMS’ management and delivery of Medicare, Medicaid, the Children’s Health Insurance Program (CHIP), and the Health Insurance Marketplaces. The fourth TMC is entitled, safeguarding the well-being of HHS beneficiaries, and outlines challenges related to services provided through HHS programs, including health care, education, childcare, and nursing home care. The fifth TMC is entitled, harnessing and protecting data and technology to improve the health and well-being of individuals, and highlights challenges HHS faces to protect data and technology against cybersecurity threats and address inequities across programs. The sixth TMC is entitled, strengthening coordination for better programs and services, and emphasizes the need for interagency collaboration to effectively execute and administer HHS programs.

• On November 17, 2022, HHS OIG published a report entitled, Long-Term Trends of Psychotropic Drug Use in Nursing Homes. This study addresses long-standing concerns that providers may inappropriately prescribe psychotropic drugs to nursing home residents. OIG, using Minimum Data Set (MDS) assessment data from CY 2011 through 2019 to identify Medicare Part D psychotropic drug claims data for long-stay nursing home residents aged 65 and older, found that about 80 percent of Medicare’s long-stay nursing home residents were prescribed a psychotropic drug. Previous CMS efforts to reduce the overuse of one type of psychotropic, antipsychotics, were successful; however, the increase of another type of psychotropic, anticonvulsants, counteracted CMS’ efforts and the overall use of psychotropics remained constant. OIG also found that higher use of psychotropic drugs was associated with nursing homes with less staffing, higher percentages of residents with low-income, and higher rates of unsupported schizophrenia diagnoses. OIG notes that CMS’ long-stay quality measure that tracks antipsychotic use in nursing homes excludes residents with schizophrenia diagnoses, which could confound the true prescription rate. Additionally, OIG states that by not collecting diagnoses on its Medicare Part D claims, CMS cannot conduct effective oversight of psychotropic drug use. Given these findings, OIG recommends that CMS (1) expand efforts to understand the true use of psychotropic drugs in nursing homes, (2) identify nursing home characteristics that are associated with their higher use, and (3) include diagnoses in Medicare Part D claims.

• On November 18, 2022, HHS OIG released a report entitled, The Centers for Medicare & Medicaid Services' Review Contractors Generally Conducted Medicaid Fee-for-Service Claim Reviews for Selected States Under the Payment Error Rate Measurement Program in Accordance with Federal and State Requirements. CMS developed the Payment Error Rate Measurement (PERM) program to measure improper payments in Medicaid and CHIP. OIG investigated the adequacy and states’ execution of the PERM program by examining 1,653 Medicaid Fee-For-Service (FFS) claims reviewed by CMS's PERM contractors. OIG found that 90 percent of Medicaid PERM FFS claims reviewed adhered to federal and state requirements. Of the 10 percent improperly conducted, OIG found that CMS's contractors did not always maintain proper documentation of their claim review determinations, because CMS did not include the necessary specific contract language.

IV. Other Health Policy News

• On November 15, 2022, the Center for Medicaid and CHIP Services (CMCS) issued an informational bulletin to describe the 2023 and 2024 updates to the Core Set of children’s health care quality measures for Medicaid and CHIP (the Child Core Set) and the Core Set of health care quality measures for adults enrolled in Medicaid (the Adult Core Set). The Core Sets are tools to understand the quality of care provided under Medicaid and CHIP providers and programs, help CMS and states assess access of care, and improve understanding of existing health disparities. The Bipartisan Budget Act of 2018 made state reporting of the Child Core Set mandatory starting in FY 2024 and the Substance Use-Disorder Prevention that Promotes Opioid Recovery and Treatment for Patients and Communities Act of 2018 (SUPPORT Act) made state reporting of behavioral health measures mandatory starting in FY 2024. More information on this can be found here.

• On November 15, 2022, CMS announced that the first improper payment rate for the Federally-facilitated Exchange (FFE) program was less than 1 percent for Benefit Year (BY) 2020. Specifically, the improper payment rate for the program was 0.62 percent or $256 million (the proper payment rate was thus 99.38 percent, or $41 billion) for BY 2020. CMS applauded its efforts to create automated processes for program eligibility determinations and payments, which helped mitigate instances of overpayments, underpayments, or payments where insufficient information was provided. The agency noted that an overwhelming majority of improper payments result from providers or states missing an administrative step, which the automated process helped mitigate. Additionally, a number of corrective actions, such as COVID-19 review flexibilities also helped contribute to decreases in improper payments across CMS programs. Specifically, the improper payment rate for Medicaid and CHIP was 15.62 percent, or $80.57 percent in 2022, a decrease from the 21.69 percent rate in 2021; the Medicare FFS estimated improper payment rate was 7.46 percent in 2022; the Medicare Part C estimated improper payment rate was 5.42 percent in 2022. More on this information can be found here.

• On November 15, 2022, CMS issued a fact sheet to describe improper payment reporting criteria, measurements, indications of fraud through improper payments, and CMS and state collaborative efforts to mitigate improper payments. CMS described that improper payments are payments that do not meet program requirements, such as insufficient payment documentation, overpayments, or underpayments. The fact sheet describes methodology used to calculate improper payments in Medicare FFS, Medicare Part C, Medicare Part D, Medicaid & CHIP, and ACA Exchange Advance payment of the Premium Tax Credit (PTC). CMS also clarifies that improper payments do not necessarily indicate fraud and can result from a various number of circumstances, such as improper documentation (e.g., no record of a beneficiary’s income eligibility). Finally, the fact sheet outlines several ways CMS has partnered with states to share information and ensure proper payment, such as through the Medicaid Eligibility Quality Control (MEQC) program, under which states design pilot programs to evaluate Medicaid and CHIP eligibility determinations, and the Medicaid Integrity Institute (MII), under which CMS offers training and technical assistance to state Medicaid program officials. More information on this fact sheet can be found here.

• On November 16, 2022, the White House released a proclamation for National Rural Health Day. The Biden Administration reaffirmed its commitment to deliver quality and affordable health care to all Americans regardless of their zip code by making insurance and prescription drugs more affordable, expanding mental health services, and by keeping rural facilities open and adequately staffed. The proclamation acknowledges several challenges rural communities face in accessing health care (e.g., rural hospital closures, disproportionate impacts of hunger in rural communities, and worsening economic conditions resulting from the COVID-19 pandemic) and touts several efforts by the Biden Administration to address them. For example, the proclamation acknowledges the $8.5 billion directed toward rural health providers in the American Rescue Plan to help keep rural facilities open, provide additional Medicare reimbursement for rural emergency and outpatient care, financial support for rural clinical students, and rural training efforts. Additionally, the proclamation highlights the Inflation Reduction Act’s efforts to lower health care premiums and prescription drug costs to make health care more affordable for all Americans and the Bipartisan Infrastructure Law’s efforts to replace lead pipes in homes and to provide clean water in all homes. Finally, the proclamation also notes the Biden Administration’s efforts to address the ongoing mental health crisis and the White House Strategy on Hunger, Nutrition, and Health to address hunger and nutrition in all communities. More information on this announcement can be found here.

• On November 16, 2022, the Senate voted to advance the Respect for Marriage Act, which would establish federal protections for same-sex and interracial marriages. Although states will not be forced to issue same-sex marriage licenses, they will be required to recognize them, as will all federal benefit programs, such as Medicare. All 50 Democratic senators and 12 Republican senators voted to advance the bill. Next, the bill will need to be passed on the Senate floor. Unless the timeline is unanimously expedited in the Senate, the bill is expected to be voted on in the Senate by early December. Then, the bill will head back to the House for final approval with amendments, before advancing to President Biden’s desk to be signed into law. More information on this bill can be found here.

• As of November 16, 2022, the Republican party has gained majority control of the House of Representatives and the Democratic party has gained majority control of the Senate for the 118th Congress. A few critical races still remain. For example, in Georgia, the Senate race between incumbent Senator Raphael Warnock (D-GA) and his Republican challenger Herschel Walker, will go to a December 6 runoff after neither candidate secured 50 percent of the vote as required for victory under Georgia law. From a leadership perspective, Senate Majority Leader Chuck Schumer (D-NY) and Senate Republican Leader Mitch McConnell (R-KY) are expected to remain in their positions. Speaker Nancy Pelosi (D-CA) announced on November 17 that she will step aside from her leadership position and Representative Kevin McCarthy (R-CA) won the Republican party’s nomination to become the next Speaker of the House. 2022 Midterm Election results can be monitored here.

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