Health Care Week in Review June 14, 2024

Health Care Week in Review: House and Senate Reintroduced MA Prior Authorization Bill, and House E&C Committee Advanced 13 Health Bills

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 House and Senate reintroduced legislation intended to streamline prior authorization in Medicare Advantage (MA) plans, and the House E&C Committee advanced 13 health bills following a markup.

I. Regulations, Notices & Guidance

Event Notices

June 20, 2024: The National Institutes of Health (NIH) announced a meeting of the Office of AIDS Research Advisory Council. This is a virtual meeting open to the public.

June 26, 2024: The Centers for Disease Control and Prevention (CDC) announced a meeting of the Advisory Board on Radiation and Worker Health. This is a hybrid meeting open to the public.

June 26, 2024: FDA announced a meeting of the Tobacco Products Scientific Advisory Committee. This is a hybrid meeting open to the public.

June 26-28, 2024: CDC announced a meeting of the Advisory Committee on Immunization Practices. This is a virtual meeting open to the public.

June 28-29, 2024: The Agency for Healthcare Research and Quality (AHRQ) announced a meeting of the National Advisory Council for Healthcare Research and Quality. This is a hybrid meeting open to the public.

July 1-2, 2024: HHS announced a meeting of the President’s Advisory Commission on Asian Americans, Native Hawaiians, and Pacific Islanders. This is a hybrid meeting open to the public.

July 11-12, 2024: FDA announced a meeting entitled Evaluating Immunosuppressive Effects of In Utero Exposure to Drug and Biologic Products. This is a hybrid meeting open to the public.

July 25, 2024: FDA announced a meeting of the Oncologic Drugs Advisory Committee. This meeting is open to the public.

June 26, 2024: NIH announced a meeting of the National Cancer Institute Council of Research Advocates. This is a virtual meeting open to the public.

II. Hearings & Markups

  • On June 12, 2024, the House Committee on Energy and Commerce (E&C) held a markup entitled, Full Committee Markup of 13 Health Bills. The Committee considered the following legislation:
    • R. 6020, Honor Our Living Donors (HOLD) Act
    • R. 455, To amend the Controlled Substances Act to fix a technical error in the definitions
    • R. 4534, Women and Lung Cancer Research and Preventive Services Act of 2023
    • R. 5012, Stillbirth Health Improvement and Education (SHINE) for Autumn Act of 2023
    • R. 7213, Autism Collaboration, Accountability, Research, Education, and Support (CARES) Act of 2024
    • R. 8084, LIVE Beneficiaries Act
    • R. 8089, Medicare and Medicaid Fraud Prevention Act of 2024
    • R. 8111, To amend title XIX of the Social Security Act to ensure the reliability of address information provided under the Medicaid program
    • R. 8112, To amend title XIX of the Social Security Act to further require certain additional provider screening under the Medicaid program
    • R. 4758, Accelerating Kids’ Access to Care Act
    • R. 5526, Seniors’ Access to Critical Medications Act
    • R. 6033, Supporting Patient Education And Knowledge (SPEAK) Act of 2023
    • R. 7858, Telehealth Enhancement for Mental Health Act of 2024
  • All bills considered were ordered reported favorably to the House of Representatives without opposition.
  • On June 13, 2024, the House Budget Committee held a hearing entitled, Medicare and Social Security: Examining Solvency and Impacts to the Federal Budget. Witnesses included: Paul Spitalnic, Chief Actuary, CMS; and Stephen Goss, Chief Actuary, Social Security Administration.
  • On June 13, 2024, the House E&C Health Subcommittee held a hearing entitled, Checking-In on CMMI: Assessing the Transition to Value-Based Care. The witness was Dr. Elizabeth Fowler, Ph.D., J.D., Deputy Administrator and Director, Center for Medicare and Medicaid Innovation (CMMI).

III. Reports, Studies, & Analyses

  • On June 13, 2024, the Office of Inspector General (OIG) released a report entitled, CMS Could Strengthen Program Safeguards To Prevent and Detect Improper Medicare Payments for Short Inpatient Stays. In 2014, CMS implemented a two-midnight rule which determined that it was inappropriate for hospital stays that were shorter than two midnights to be billed as inpatient. OIG conducted an audit on Medicare claims for short inpatient stays during 2016-2020 and found that CMS lacked sufficient safeguards to ensure compliance with the two-midnight rule, resulting in an estimated $7.8 billion in improper payments. The report determined that CMS did not have adequate information, prepayment edits, or effective review policies to identify and recover overpayments for short stays that did not meet the rule’s criteria. OIG recommended that CMS: (1) indicate on short inpatient stay claims if the stay was short due to unforeseen circumstances; (2) create a list inpatient-only procedures that includes inpatient codes that are associated with outpatient codes; (3) implement prepayment edits for short inpatient stay claims; and (4) update procedures and policies to clarify that post payment reviews should focus on short inpatient stays that are identified as risk of non-compliance with the rule.
  • On June 14, 2024, the Congressional Budget Office (CBO) published a report entitled, Budgetary Effects of Policies That Would Increase Hepatitis C Treatment. CBO conducted an analysis of potential federal budgetary effects of policies aimed at increasing hepatitis C treatment among Medicaid enrollees, focusing on two hypothetical national programs. These programs would raise treatment rates by 10 percent and 100 percent over current levels, peaking over a five-year period. The increase in treatment rates, achieved through outreach activities, would gradually return to baseline after the programs ended. CBO’s findings indicated that increased treatment would lead to significant savings from avoided healthcare costs related to hepatitis C complications. For instance, a 10 percent increase in treatment would result in $0.7 billion in savings over 10 years, with $0.5 billion spent on treatment and testing. A 100 percent increase in treatment would save $7 billion, with $4 billion spent on treatment and testing. The analysis also highlighted that substantial outreach would be essential to achieve these treatment increases, although CBO did not include the costs of outreach in its estimates. Comprehensive accounting would require considering these additional federal expenses. The ultimate budgetary impact would depend on various factors, including the specifics of the implemented policies, the success of outreach efforts, and the extent of adherence to treatment. The report also stated that since hepatitis C progresses slowly, long-term budgetary effects beyond the typical 10-year analysis window are particularly pertinent. Future CBO work will evaluate the longer-term effects on federal programs like Medicare and Social Security, considering improvements in health and longevity from increased hepatitis C treatment.

IV. Other Health Policy News

  • On June 10, 2024, the Supreme Court of the United States (SCOTUS) agreed to hear Advocate Christ Medical Center, et al., v. Xavier Becerra, which challenges how HHS accounts for Supplemental Security Income (SSI) beneficiaries in Medicare disproportionate share hospital (DSH) payment calculations. HHS currently includes SSI beneficiaries into DSH calculations when they receive SSI cash payments during their hospital stay. The plaintiffs argue that this excludes SSI beneficiaries who receive benefits other than cash or who are eligible for cash payments but do not receive them. Their argument is rooted in Becerra v. Empire Health Foundation, a 2022 SCOTUS case which determined that patients who are entitled to Medicare Part A benefits are counted in the hospital’s DSH formula, regardless of if Medicare paid for their hospital stay. Plaintiffs argue that HHS must follow the same logic when counting SSI beneficiaries, meaning all patients who are eligible for SSI would be counted in the DSH formula, regardless of if they received cash payments that month. If the court sides with the plaintiffs, DSH funds could significantly increase in hospitals that serve a large number of SSI beneficiaries.
  • On June 12, 2024, a bipartisan group of Senators and Representatives, including Senators Roger Marshall (R-KS), Kyrsten Sinema (I-AZ), John Thune (R-SD), and Sherrod Brown (D-OH), along with Representatives Mike Kelly (R-PA), Suzan DelBene (D-WA), Larry Bucshon (R-IN) and Ami Bera (D-CA) reintroduced the Improving Seniors’ Timely Access to Care Act of 2024. The bill is intended to reduce administrative burdens on healthcare providers, improve patient outcomes, and ensure that seniors receive the care they need without unnecessary delays. The Improving Seniors’ Timely Access to Care Act of 2024 is also designed to streamline the prior authorization process under MA by establishing a standardized electronic prior authorization system, which would expedite the approval process for medical services, thus allowing seniors to receive timely and quality care. Additionally, the bill is intended to increase transparency around prior authorization requirements and usage, enhance beneficiary protections, and clarify the authority of CMS to set timeframes for expedited determinations and real-time decisions for routinely approved services. The legislation also would mandate reporting to Congress on program integrity efforts and other ways to further improve the electronic prior authorization process. The bill has garnered widespread support from over 370 national and state organizations representing patients, physicians, and other key stakeholders in the healthcare industry.
  • On June 12, 2024, the Office of the Actuary has released its projections for National Health Expenditures (NHE) and health insurance enrollment from 2023 to 2032. Over this period, NHE is expected to grow at an average annual rate of 5.6 percent, outpacing the gross domestic product (GDP) growth rate of 4.3 percent, leading to an increase in health spending as a share of GDP from 17.3 percent in 2022 to 19.7 percent in 2032. The projections account for the effects of the Inflation Reduction Act of 2022, including changes to Medicare’s Part D drug benefit and negotiations for high-cost drugs. The report highlights that in 2023, NHE growth was particularly high at 7.5 percent, driven by increased healthcare utilization and a record insured population rate of 93.1 percent, primarily due to high Medicaid enrollment and direct-purchase insurance gains. Specific highlights include Medicare expenditures projected to grow annually by 7.4 percent, with a slight decrease post-2030 as baby boomer enrollment tapers off. Medicaid spending is expected to grow at 5.2 percent annually, stabilizing after 2024 as normal eligibility processes resume. Private health insurance spending is projected to grow at 5.6 percent, with enrollment fluctuations due to temporary subsidy extensions. Out-of-pocket spending is expected to grow by 4.7 percent, influenced by Medicare’s new out-of-pocket caps and drug price negotiations. Hospital spending is projected to grow by 5.7 percent, with similar growth rates expected for physician services. Retail prescription drug spending is anticipated to grow by 6.0 percent, influenced by new drug introductions and the Inflation Reduction Act’s pricing provisions.

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