Health Care Week in Review: Biden Administration Released FY2025 Budget; Bill Introduced to Make Telehealth Permanent

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, the Biden Administration released their fiscal year (FY) 2025 proposed budget, and a group of bipartisan representatives introduced a bill to make Medicare coverage of telehealth services permanent.

I. Regulations, Notices & Guidance

• On March 11, 2024, the Food and Drug Administration (FDA) released a notice entitled, Guidance: Early Alzheimer's Disease: Developing Drugs for Treatment. This draft guidance is intended to assist sponsors in the clinical development of drugs for the treatment of the stages of sporadic Alzheimer’s disease (AD) that occur before the onset of overt dementia. This draft guidance revises the previous draft guidance for industry of the same name issued on February 16, 2018.
• On March 12, 2024, FDA released a notice entitled, Annual Reportable Labeling Changes for New Drug Applications and Abbreviated New Drug Applications for Nonprescription Drug Products; Draft Guidance for Industry; Availability. This draft guidance provides recommendations to applicants of approved new drug applications (NDAs) and ANDAs for nonprescription drug products on documenting minor labeling changes in the next annual report and provides examples of minor labeling changes that may be submitted in an annual report. The recommendations in this draft guidance address the types of minor labeling changes that may be appropriate to submit in an annual report to ensure that consumers have timely access to the most current labeling for a nonprescription drug product which helps ensure the product's safe and effective use. FDA anticipates that these recommendations may assist industry in understanding the circumstances in which it would be appropriate to document minor changes in the applicant's next annual report rather than submitting a prior approval supplement or “changes being effected” supplement, thereby reducing burden on industry and FDA.
• On March 12, 2024, FDA released a notice entitled, Select Updates for the Premarket Cybersecurity Guidance: Section 524B of the Federal Food, Drug, and Cosmetic Act; Draft Guidance for Industry and Food and Drug Administration Staff; Availability. This draft guidance proposes select updates to the final guidance “Cybersecurity in Medical Devices: Quality System Considerations and Content of Premarket Submissions.” This draft guidance, when finalized, will identify the information FDA generally considers to be necessary for cyber devices to support obligations under the new amendments to the Federal Food, Drug, and Cosmetic Act (FD&C Act) for ensuring cybersecurity of devices. This draft guidance is not final nor is it for implementation at this time.
• On March 13, 2024, the Centers for Disease Control and Prevention (CDC) released a notice entitled, Request for Information: National Institute for Occupational Safety and Health; Outdoor Workers Exposed to Wildland Fire Smoke. CDC announced an opportunity for the public to provide information about approaches to assess and control the hazards of wildland fire smoke to outdoor workers. Wildland fire smoke is a complex mixture of potentially toxic gases and particles that can vary depending on factors in the wildland or wildland urban interface environment, such as weather, fire behavior, and the type of materials or vegetation burning. Because of this, outdoor workers may be exposed to varying types and amounts of compounds in wildland fire smoke throughout their work shift or during different fire events and job tasks. The National Institute for Occupational Safety and Health (NIOSH) is seeking information to develop a hazard review document that summarizes the scientific literature about the health effects from exposures to wildland fire smoke and provides recommendations to protect outdoor workers.
• On March 13, 2024, FDA released a notice entitled, Guidance: E2D(R1) Post-Approval Safety Data: Definitions and Standards for Management and Reporting of Individual Case Safety Reports; International Council for Harmonisation. The draft guidance was prepared under the auspices of the International Council for Harmonisation of Technical Requirements for Pharmaceuticals for Human Use (ICH). The draft guidance updates the existing E2D guidance entitled “E2D Post-Approval Safety Data Management: Definitions and Standards for Expedited Reporting,” published in 2003. The draft guidance is intended is to clarify the use of new or increasingly used data sources (e.g., social media, market research programs, patient support programs) and update terminology and standards for post-market adverse event reporting.
• On March 14, 2024, FDA issued a final rule technical amendment entitled, Medical Devices; Technical Amendments. FDA is amending certain medical device regulations to update a citation for information collection and conform the regulatory provisions to the Federal Food, Drug, and Cosmetics Act (FD&C Act). The rule does not impose any new requirements on affected parties. This action is editorial in nature to correct errors and to ensure accuracy and clarity in the Agency’s regulations.
• On March 14, 2024, FDA issued a final rule entitled, Frozen Cherry Pie; Revocation of a Standard of Identity and a Standard of Quality. FDA is revoking the standard of identity and the standard of quality for frozen cherry pie. This action, in part, responds to a citizen petition submitted by the American Bakers Association (ABA). FDA states that these standards are no longer necessary to promote honesty and fair dealing in the interest of consumers. Revocation of the standards of identity and quality for frozen cherry pie will provide greater flexibility in the product’s manufacture, consistent with comparable, non-standardized foods available in the marketplace.
• On March 14, 2024, FDA issued a notice entitled, Evaluation of Thermal Effects of Medical Devices That Produce Tissue Heating and/or Cooling; Draft Guidance for Industry and Food and Drug Administration Staff; Availability. FDA is announcing the availability of draft guidance entitled ‘‘Evaluation of Thermal Effects of Medical Devices That Produce Tissue Heating and/or Cooling.’’ FDA is issuing this draft guidance to describe relevant information that should be provided in premarket submissions to support the evaluation of thermal effects of medical devices that produce local, regional, and/or systemic changes in tissue temperature (i.e., heating and/or cooling) due to their use. The recommendations in this draft guidance reflect current review practices and are intended to promote consistency and facilitate efficient review of thermal effects data in premarket submissions for these devices. This draft guidance is not final.
• On March 14, 2024, the Department of Health and Human Services (HHS) issued a notice entitled, Approval Tests and Standards for Combination Unit Respirators. HHS proposes to amend regulatory requirements that would be used by the CDC’s National Institute for Occupational Safety and Health (NIOSH) to test and approve combination unit respirators. This rulemaking would establish this new class of respiratory protective device, combination unit respirators (CURs), by incorporating by reference the performance requirements established in the National Fire Protection Association (NFPA) voluntary consensus standard NFPA 1987, Standard on Combination Unit Respirator Systems for Tactical and Technical Operations.
• On March 15, 2024, CDC released a notice entitled, Solicitation for Nominations for Appointment to the Board of Scientific Counselors, National Institute for Occupational Safety and Health. In accordance with the Federal Advisory Committee Act, CDC is seeking nominations for membership on the Board of Scientific Counselors (BSC), NIOSH). The BSC, NIOSH consists of 15 experts in fields associated with occupational safety and health.
• On March 15, 2024, FDA released a notice entitled, Controlled Correspondence Related to Generic Drug Development; Guidance for Industry; Availability. FDA is announcing the availability of a final guidance for industry entitled “Controlled Correspondence Related to Generic Drug Development.” This guidance provides information regarding the process by which generic drug manufacturers and related industry can submit controlled correspondence to FDA requesting information related to generic drug development and the Agency’s process for providing communications related to such correspondence. This guidance also describes the process by which generic drug manufacturers and related industry can submit requests to clarify ambiguities in FDA’s controlled correspondence response and the Agency’s process for responding to those requests. This guidance finalizes the draft guidance of the same title issued on December 22, 2022. This guidance replaces the guidance “Controlled Correspondence Related to Generic Drug Development” issued on December 17, 2020.
• On March 15, 2024, FDA released a notice entitled, Manufacture of Batches in Support of Original New Animal Drug Applications, Abbreviated New Animal Drug Applications, and Conditional New Animal Drug Applications; Draft Guidance for Industry; Availability. FDA is announcing the availability of a draft guidance for industry 285 entitled “Manufacture of Batches in Support of Original NADAs, ANADAs, and CNADAs.” This draft guidance is intended to provide recommendations for the primary batches of drug product manufactured to support the approval or conditional approval of new animal drug products. This guidance is applicable to all original new animal drug applications (NADAs) and abbreviated new animal drug applications (ANADAs), and their associated investigational new animal drug files (INADs) and generic investigational new animal drug files, respectively, as well as applications for conditional approval of new animal drugs (CNADAs).
• On March 15, 2024, FDA released a notice entitled, Pharmacokinetics in Patients with Impaired Renal Function – Study Design, Data Analysis, and Impact on Dosing; Guidance for Industry; Availability. FDA is announcing the availability of a final guidance for industry entitled “Pharmacokinetics in Patients with Impaired Renal Function – Study Design, Data Analysis, and Impact on Dosing.” FDA states that in general, drug development programs should be conducted so that when products are approved, the labeling provides appropriate dosing recommendations for patients with renal impairment. This guidance is intended to assist sponsors in the design and analysis of studies that assess the influence of impaired renal function on the pharmacokinetics (PK) and/or pharmacodynamics (PD) of an investigational drug and addresses how such information can inform the labeling. This guidance finalizes the draft guidance “Pharmacokinetics in Patients with Impaired Renal Function – Study Design, Data Analysis, and Impact on Dosing” issued on September 4, 2020.

Event Notices

March 18, 2024: The National Institutes of Health (NIH)  announced a meeting of the Muscular Dystrophy Coordinating Committee. This is a virtual meeting open to the public.

March 19, 2024: CDC announced a meeting of the ICD-10 Coordination and Maintenance Committee. This is a virtual meeting open to the public.

March 20, 2024: NIH announced a meeting of the National Cancer Institute Board of Scientific Advisors. This is a virtual meeting open to the public.

March 20, 2024: HHS announced a meeting of the Secretary’s Advisory Committee on Human Research Protections. This is a virtual meeting open to the public.

March 21, 2024: The Administration for Community Living (ACL) announced a meeting of the President’s Committee for People with Intellectual Disabilities. This is a virtual meeting open to the public.

March 21, 2024: FDA announced a meeting of the Ophthalmic Devices Panel of the Medical Devices Advisory Committee. This is a virtual meeting open to the public.

March 22, 2024: NIH announced a meeting of the National Advisory Child Health and Human Development Council Task Force on Research Specific to Pregnant Women and Lactating Women (PRGLAC) Implementation Working Group. This is a hybrid meeting open to the public.

March 25, 2024: NIH announced a meeting of the Center for Scientific Review Advisory Council. This is a hybrid meeting open to the public.

March 25-26, 2024: HHS announced a meeting of the Physician-Focused Payment Model Technical Advisory Committee (PTAC). This is a hybrid meeting open to the public.

March 27, 2024: The Substance Abuse and Mental Health Services Administration (SAMHSA) announced a meeting of the Interdepartmental Serious Mental Illness Coordinating Committee. This is a hybrid meeting open to the public.

April 2-4, 2024: The Health Resources and Services Administration (HRSA) announced a meeting of the Advisory Committee on Infant and Maternal Health. This is a hybrid meeting open to the public.

April 4-5, 2024: NIH announced a meeting of the Sleep Disorders Research Advisory Board. This is a hybrid meeting open to the public.

April 5, 2024: HHS announced a meeting of the Office of Global Affairs on Public Health Emergencies Preparedness and Response Negotiations. This is a virtual meeting open to the public.

April 9, 2024: NIH announced a meeting of the Advisory Committee on Research on Women’s Health. This is a hybrid meeting open to the public.

April 10, 2024: CDC announced a meeting of the Clinical Laboratory Improvement Advisory Committee. This is a virtual meeting open to the public.

April 9-11, 2024: HRSA announced a meeting of the National Advisory Committee on Rural Health and Human Services. This is a hybrid meeting open to the public.

April 17, 2024: NIH announced a meeting of the Interagency Autism Coordinating Committee. This is a hybrid meeting open to the public.

April 17, 2024: CDC announced a meeting of the Advisory Board on Radiation and Worker Health, National Institute for Occupational Safety and Health. This is a hybrid meeting open to the public.

April 17, 2024: CDC announced a meeting of the Community Preventative Services Task Force. This is a virtual meeting open to the public.

May 6, 2024: CDC announced a meeting of the National Advisory Board on Medical Rehabilitation Research.

May 9, 2024: FDA announced a meeting of the Blood Products Advisory Committee. This is a virtual meeting open to the public.

II. HEARINGS & MARKUPS

House of Representatives

• On March 12, 2024, the House Energy and Commerce Subcommittee on Health held a markup of 19 bills. Legislation considered included: H.R. 619, NAPA Reauthorization Act;  H.R. 620, Alzheimer’s Accountability and Investment Act; H.R. 7218, Building Our Largest Dementia (BOLD) Infrastructure for Alzheimer's Act of 2024; H.R. 5012, SHINE for Autumn Act of 2023; H.R. 4581, Maternal and Child Health Stillbirth Prevention Act of 2023; H.R. 2706, Charlotte Woodward Organ Transplant Discrimination Prevention Act; H.R. 4646, SIREN Reauthorization Act; H.R. 6160, To amend the Public Health Service Act to reauthorize a lifespan respite care program; H.R. 6960, Emergency Medical Services for Children Reauthorization Act of 2024; H.R. 7153, Dr. Lorna Breen Health Care Provider Protection Reauthorization Act; H.R. 7251, Poison Control Centers Reauthorization Act of 2024; H.R. 7224, To amend the Public Health Service Act to reauthorize the Stop, Observe, Ask, and Respond to Health and Wellness Training Program; H.R. 7208, Traumatic Brain Injury Program Reauthorization Act of 2024; H.R. 6829, Cardiomyopathy Health Education, Awareness, Research, and Training in the Schools (HEARTS) Act of 2023; H.R. 7189, Congenital Heart Futures Reauthorization Act of 2024; H.R. 7406, DeOndra Dixon INCLUDE Project Act of 2024; H.R. 3916, SCREENS for Cancer Act of 2023; H.R. 5074, Kidney PATIENT Act; and, H.R. 5526, Seniors’ Access to Critical Medications Act of 2023. All 19 bills were adopted and advanced to the full Energy and Commerce Committee.
• On March 12, 2024, the House Ways and Means Committee held a hearing entitled, Enhancing Access to Care at Home in Rural and Underserved Communities. Witnesses included: Ms. Bell Maddux, Home Dialysis Patient and Working Mother; Mr. Roy Underhill, Hospital at Home Patient; Dr. Nathan Starr, MD, Lead Hospitalist of Tele-Hospitalist Program, Castell Home Services, Intermountain Healthcare; Mr. Chris Altchek, Founder and CEO, Cadence; and, Dr. Ateev Mehrotra, Professor of Health Care Policy and Medicine at Harvard Medical School and Hospitalist at Beth Israel Deaconess Medical Center

Senate

• On March14, 2024, the Senate Finance Committee held a hearing entitled, The President’s Fiscal Year 2025 Health and Human Services Budget. Witnesses included the Honorable Xavier Becerra, Secretary, HHS.

III. Reports, Studies, & Analyses

• On March 13, 2024, the Office of the Inspector General (OIG) released a report entitled, Pennsylvania Improperly Claimed $551 Million in Medicaid Funds for Its School-Based Program. OIG conducted an audit to assess whether Pennsylvania properly claimed federal funds through its Medicaid school-based program, covering approximately $590 million in federal Medicaid payments from July 1, 2015, through June 30, 2019. The audit revealed that Pennsylvania improperly claimed $551.4 million due to unsupported random moment time studies (RMTSs), improper cost allocation methods, and incomplete inclusion of school staff workdays. Specifically, moments coded as Medicaid-eligible were not adequately supported, and unsupported ratios were used to allocate costs to Medicaid. Pennsylvania disagreed with monetary recommendations but agreed with procedural recommendations and outlined steps to improve claim accuracy.
• On March 13, 2024, OIG released a report entitled, Kansas’s Medicaid Estate Recovery Program Was Cost Effective, but Kansas Did Not Always Follow Its Procedures, Which Could Have Resulted in Reduced Recoveries. OIG conducted an audit to assess Kansas' compliance with federal and state requirements in operating its Medicaid Estate Recovery Program (MERP) and to evaluate the program's cost-effectiveness. The audit, covering state fiscal years 2020 through 2022, revealed that while Kansas generally followed estate recovery procedures for cases resulting in asset recoveries, deficiencies were found in cases with no asset recoveries, including delays in initiating probates and liens. Additionally, some deceased Medicaid recipients were not identified for estate recovery. Despite these shortcomings, MERP collected $37 million in estate recoveries, surpassing its $5 million operating costs. OIG recommended improvements in identifying eligible recipients and enhancing oversight of the estate recovery contractor's performance. Kansas concurred with the recommendations, attributing delays to COVID-19 and system upgrades, and outlined corrective actions.
• On March 14, 2024, the Office of Government Accountability Office (GAO) released a report entitled, Medicaid Managed Care: Additional Federal Action Needed to Fully Leverage New Appeals and Grievances Data. GAO noted that because states pay Medicaid managed care organizations (MCOs) a capitated rate per enrollee, rather than per service, MCOs may have financial incentives to deny or limit necessary medical care. Enrollees can appeal these service denials and file grievances if they are dissatisfied. Beginning in 2022, state Medicaid agencies were required to release some annual data on appeals and grievances to the Centers for Medicare & Medicaid Services (CMS). However, states are not required to report on the outcomes of appeals, nor has CMS made progress analyzing the data and publicly releasing their reports. GAO made the following recommendations: (1) CMS should require states to report the outcomes of service denial appeals; and (2) CMS should implement their plan to analyze and publicly this release data.

IV. Other Health Policy News

• On March 11, 2024, the Biden Administration released its proposed budget for fiscal year (FY) 2025. The budget proposes significant investments across various healthcare sectors, intended to build on previous successes and aimed at addressing pressing challenges. Key highlights include expanding coverage and lowering healthcare costs through initiatives such as extending Marketplace affordability and capping the cost of insulin products, strengthening maternal and reproductive health outcomes with increased funding for programs addressing maternal mortality and health equity, and transforming behavioral healthcare with substantial investments to expand access to mental health and substance use disorder services. Other initiatives include the following:
  • Expand Coverage and Lower Healthcare Costs:
    • Extension of Marketplace affordability and capping insulin costs at $35 per month.
    • Expansion of Medicare's ability to negotiate drug prices.
    • Permanent extension of enhanced premium tax credits.
    • Provision of Medicaid-like coverage for low-income individuals.
    • Extension of consumer surprise billing protections to ground ambulances.
  • Strengthen Maternal and Reproductive Health Outcomes:
    • Increase in funding for Title X family planning program.
    • Allocation of $376 million for programs addressing maternal mortality and health equity.
  • Transform Behavioral Healthcare:
    • $20.8 billion investment in behavioral health.
    • Dedication of $602 million to the 9-8-8 suicide and crisis lifeline.
    • Expansion of coverage for behavioral health services.
  • Advance Science to Improve Health:
    • $2.9 billion investment in the Cancer Moonshot initiative.
    • Increase of $100 million for CDC to fund cancer prevention and control programs.
• The HHS Budget in Brief is available here. A Fact Sheet on the budget is available here.
• On March 11, 2024, the Biden Administration released a fact sheet outlining ways Congress can work to lower drug costs for Americans with commercial insurance. The initiatives include expanding Medicare's authority to negotiate drug prices for a broader range of medications, such as those used to treat heart disease, cancer, and diabetes. Additionally, the administration advocated for the expansion of the $2,000 annual cap on out-of-pocket prescription drug costs in Medicare Part D to all private insurance market plans. Furthermore, the proposal seeks to test lower cost-sharing for high-value generic drugs in Medicare and expand the requirement for drug manufacturers to pay rebates when they increase prices faster than inflation to include commercial drug sales, potentially reducing health insurance premiums for individuals with private coverage. The Fact Sheet is available here.
• On March 12, 2024, Representatives Brad Wenstrup (R-OH-2) and Earl Blumenauer (D-OR-3) released a bipartisan discussion draft aimed at expanding access to health care at home, particularly in rural and underserved areas. The draft legislation proposes extending the Hospital Care at Home waivers, initially launched in 2020 to address challenges posed by the COVID-19 pandemic, until 2027. The Acute Hospital Care at Home (AHCAH) initiative has seen participation from numerous hospitals across various states. The draft seeks feedback from patients, providers, and health systems involved in the program, emphasizing the importance of tailoring care to meet individual needs. Representative Wenstrup highlighted the program's significance in providing quality care while ensuring patient comfort and recovery at home, while Representative Blumenauer emphasized the positive impact of at-home care on patient outcomes and experiences. The release of the draft follows a House Ways and Means Committee hearing underscoring the need for flexible approaches to enhance Hospital at Home programs and improve access to care. A press release with more information is available here. The text of the discussion draft is available here.
• On March 12, 2024, Representative Buddy Carter (R-GA-1), along with Representatives Lisa Blunt Rochester (D-DE), Greg Steube (R-FL-17), Terri Sewell (D-AL-7), Mariannette Miller-Meeks (R-IA-1), Jefferson Van Drew (R-NJ-2), and Joe Morelle (D-NY-25) introduced the Telehealth Modernization Act of 2024, which aims to make telehealth services permanently available for Medicare beneficiaries. The bill extends telehealth flexibilities to federally qualified health centers (FQHCs) and rural health clinics (RHCs), ensuring access to timely and high-quality care for seniors and those in rural areas. The bipartisan effort recognizes the importance of telehealth, especially highlighted during the COVID-19 pandemic, and seeks to safeguard its accessibility for all patients. The bill has garnered support from various organizations, including the American Telemedicine Association, American Hospital Association, American Medical Association, and others, emphasizing the importance of telehealth in modern healthcare delivery. The full text of the bill is available here.
• On March 14, 2024, Senate Finance Committee Chair Ron Wyden (D-OR) and Ranking Member Mike Crapo (R-ID) reiterated their bipartisan call for passing legislation aimed at reforming pharmacy benefit managers (PBMs) during a press conference in Washington, D.C. The Senators asserted that PBMs' practices are inflating prescription drug costs and leading to the closure of pharmacies nationwide. In a letter to Finance Committee members, Senators Crapo and Wyden reaffirmed their commitment to advancing their bipartisan legislation as swiftly as possible in the current Congress. They underscored the need to reduce out-of-pocket medication costs for seniors, strengthen federal oversight, and safeguard patients' access to pharmacies. The bipartisan PBM reform package, which passed the Senate Finance Committee unanimously in November 2023, reflects the growing consensus about PBM reform in Congress. The letter to Senate Finance Committee members is available here. A recording of this morning’s press conference is available here.

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