Health Care Week in Review: Congress Passes Omnibus, HHS Releases Hospital Data | News & Insights

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, Congress passed the 2023 omnibus funding package ahead of the December 23 deadline and HHS released ownership data for all Medicare-certified hospitals. Read more about these actions and other news below.

I. Regulations, Notices & Guidance

On December 21, 2022, FDA issued draft guidance entitled, Controlled Correspondence Related to Generic Drug Development.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 This draft guidance revises the guidance for industry entitled “Controlled Correspondence Related to Generic Drug Development” issued in December 2020.
On December 21, 2022, FDA issued draft guidance entitled, M11 Clinical Electronic Structured Harmonised Protocol (CeSHarP). This guidance also includes two supplemental documents entitled, “M11 Template,” and “M11 Technical Specification.” The draft guidance, template, and technical specification were prepared under the auspices of the International Council for Harmonisation of Technical Requirements for Pharmaceuticals for Human Use (ICH), formerly the International Conference on Harmonisation. The draft guidance provides recommendations for a harmonized clinical trial protocol including the organization of standardized content and formatting. The draft template identifies headers, common text, and a set of data fields and terminologies that will be the basis for efficiencies in data exchange. The technical specification recommends the use of an open, non-proprietary standard to enable electronic exchange of clinical protocol information. The intent of the draft guidance and supporting documents is to create an international standard for the content and exchange of clinical trial protocol information facilitating review and assessment by regulators, sponsors, ethical oversight bodies, investigators, and other stakeholders.
On December 21, 2022, FDA issued a request for nominations entitled, Request for Nominations of Voting Members on a Public Advisory Committee; National Mammography Quality Assurance Advisory Committee. FDA is requesting nominations for voting members to serve on the National Mammography Quality Assurance Advisory Committee (NMQAAC) in the Center for Devices and Radiological Health (CDRH). Nominations will be accepted for current and upcoming vacancies effective February 1, 2023, with this notice. Nominations received on or before February 20, 2022, will be given first consideration for membership on NMQAAC.
On December 21, 2022, the National Institutes of Health (NIH) issued a notice entitled, Notice to Announce the Updated Significant Changes to the Revised NIH Grants Policy Statement for Fiscal Year 2023. NIH announced publication of the updated Significant Changes that have already been made to the NIH Grants Policy Statement (NIHGPS) in fiscal year (FY) 2022, which will be reflected in the GPS for FY 2023. The NIHGPS provides both up-to-date policy guidance that serves as NIH standard terms and conditions of award for all NIH grants and cooperative agreements, and extensive guidance to those who are interested in pursuing NIH grants. This update incorporates significant changes for FY 2023, such as new and modified requirements, clarification of certain policies, and changes in statutes, regulations, and policies that have been implemented through appropriate legal and/or policy processes since the previous version of the NIHGPS dated December 2021.
On December 22, 2022, the Substance Abuse and Mental Health Services Administration (SAMHSA) issued a notice entitled, Request for Comments on the Initial Revised Draft of the Update to the Certified Community Behavioral Health Clinics Certification Criteria. SAMHSA is seeking public comment on the initial revised draft of the update to the Certification Criteria for Certified Community Behavioral Health Clinics (CCBHCs). CCBHCs were established under the Section 223 of the Protecting Access to Medicare Act of 2014 (PAMA, Pub. L. 113-93). Section 223 of PAMA requires the establishment of Medicaid demonstration programs to improve community behavioral health services through the development of CCBHCs. CCBHCs are required to provide a comprehensive array of coordinated services to anyone who requests care for mental health or substance use, regardless of ability to pay, place of residence, or age - including developmentally appropriate care for children. PAMA required the Department of Health and Human Services (HHS) to develop criteria for states to use when certifying clinics to participate in their demonstration programs. These criteria include six areas: (1) staffing, (2) availability and accessibility of services, (3) care coordination, (4) scope of services, (5) quality and other reporting, and (6) organizational authority. SAMHSA is seeking to make minor revisions to the criteria to respond to these developments and lessons learned, while still maintaining the overarching requirements for program areas and scope of services outlined in PAMA. The initial draft of the updated CCBHC Criteria will be available for public comment before the end of December 2022 and will be open to mid-January 2023.
On December 22, 2022, HHS issued several notices entitled, Notice of amendment. HHS is extending the effective time period of five Declarations. The Public Readiness and Emergency Preparedness Act (PREP Act) authorizes the HHS Secretary to issue a Declaration to provide liability immunity to certain individuals and entities (Covered Persons) against any claim of loss caused by, arising out of, relating to, or resulting from the administration or use of medical countermeasures (Covered Countermeasures), except for claims that meet the PREP Act’s definition of willful misconduct. Under this authority, the Secretary issued several Declarations for countermeasures against pandemic influenza: (1) the neuraminidase class of antivirals Oseltamivir Phosphate (e.g., Tamiflu) and Zanamivir (e.g. Relenza); (2) pandemic influenza diagnostics, personal respiratory protection devices, and respiratory support devices; and (3) pandemic influenza vaccines. Due to the continued public health threat of Pandemic influenza A viruses and influenza A viruses, HHS is extending the time period for which liability immunity is in effect for all of the Covered Countermeasures to December 31, 2027.
On December 23, 2022, FDA issued a final order entitled, Medical Devices; Cardiovascular Devices; Classification of the Adjunctive Hemodynamic Indicator with Decision Point. FDA is classifying the adjunctive hemodynamic indicator with decision point 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 adjunctive hemodynamic indicator with decision point’s classification. FDA is taking this action because it has 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. The order is effective December 27, 2022.
On December 23, 2022, FDA issued a final order entitled, Medical Devices; Immunology and Microbiology Devices; Classification of the Human Leukocyte Antigen Typing Companion Diagnostic Test. FDA is classifying the human leukocyte antigen typing companion diagnostic test 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 human leukocyte antigen typing companion diagnostic test’s classification. FDA is taking this action because it has 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. The order is effective December 27, 2022.

Event Notices

January 5, 2023: NIH announced a meeting of the Eunice Kennedy Shriver National Institute of Child Health and Human Development (NICHD) National Advisory Child Health and Human Development Council Stillbirth Working Group (Working Group). The NICHD Working Group is charged with providing a report to the National Advisory Child Health and Human Development Council (NACHHD) focusing on the current barriers to collecting data on stillbirths throughout the U.S., communities at higher risk of stillbirth, the psychological impact and treatment for mothers following stillbirth, and known risk factors for stillbirth.
January 18, 2023: NIH announced a public meeting of the NIH Interagency Autism Coordinating Committee (IACC). The purpose of the meeting is to discuss business, agency updates, and issues related to autism spectrum disorder (ASD) research and services activities.
January 23, 2023: CDC announced a meeting of the Board of Scientific Counselors, Center for Preparedness and Response (BSC, CPR). The agenda will include: (1) an update on the CDC Moving Forward Initiative; and (2) a BSC, CPR health equity discussion.
January 30, 2023: NIH announced a partially open meeting of the National Institute of Allergy and Infectious Diseases (NIAID) Advisory Council. The open agenda will include reports from the division director and division staff. The closed agenda will include review and evaluation of grant applications.
January 30, 2023: NIH announced a public meeting of the AIDS Research Advisory Committee, NIAID. The meeting agenda will include a report from the Division Director and from Division staff.
February 1-2, 2023: NIH announced a partially open meeting of the National Advisory Neurological Disorders and Stroke Council (NANDSC). The open agenda will include a report by the Director of the National Institute of Neurological Disorders and Stroke (NINDS); a report by the Director of the Division of Extramural Activities; and administrative and program developments. The closed agenda will include review and evaluation of grant applications.
February 2-3, 2023: NIH announced a partially open meeting of the National Deafness and Other Communication Disorders (NDCD) Advisory Council. The open agenda will include staff reports on divisional, programmatical, and special activities. The closed agenda will include review and evaluation of grant applications.
February 9, 2023: FDA announced a meeting of the Oncologic Drugs Advisory Committee. The committee will discuss investigational new drug application (IND) 157775, for dostarlimab for injection, submitted by GlaxoSmithKline LLC. The proposed indication (use) for this product is for monotherapy in patients with mismatch repair deficiency/microsatellite instability-high locally advanced rectal cancer. FDA would like to obtain the committee’s input on the following: (1) the adequacy of the proposed trial(s) to evaluate the benefits and risks of dostarlimab for the proposed indication, including trial design, study population, clinical endpoint, and patient followup; and (2) the adequacy of the proposed data package to permit an assessment of the benefits and risks of dostarlimab for the proposed indication.

II. Reports, Studies & Analyses

On December 19, 2022, HHS Office of Inspector General (OIG) published a report entitled, Medicare Part B Spending on Lab Tests Increased in 2021, Driven By Higher Volume of COVID-19 Tests, Genetic Tests, and Chemistry Tests. OIG conducted this review to analyze Medicare payments for laboratory (lab) tests in 2021. OIG assessed claims data for lab tests performed in 2021 that the Center for Medicare & Medicaid Services (CMS) paid for under the Clinical Laboratory Fee Schedule (CLFS) and found a 17 percent increase in Medicare Part B spending on lab tests from 2020 ($8.0 billion) to 2021 ($9.3 billion). Specifically, OIG found that the spending increase resulted from increased volume for three types of tests: COVID-19 tests, genetic tests, and chemistry tests. Compared to 2020, in 2021, Medicare Part B spent approximately a 29 percent increase on COVID-19 tests, a 56 percent increase on genetic tests, and a 10 percent increase on chemistry tests. OIG concluded the increased spending on lab tests may be attributable to an increased demand by individuals. However, spending on chemistry tests remained below pre-pandemic levels, which OIG believes could indicate that people are not seeking routine or preventive care.
On December 19, 2022, HHS OIG released a report entitled, Providers Did Not Always Comply With Federal Requirements When Claiming Medicare Bad Debts. OIG conducted this audit to determine whether (1) providers complied with federal requirements when claiming Medicare reimbursement for Medicare bad debts and (2) providers' policies and procedures for collecting Medicare bad debts from beneficiaries complied with federal requirements. OIG assessed 148 Medicare bad debt claims and found that 86 were found indigent and therefore no collection efforts were made and that providers did not comply with federal requirements when claiming 22 other Medicare bad debts which resulted in a total of $29,787 in unallowable Medicare reimbursement. Thus, OIG recommended that CMS issue guidance to Medicare administrative contractors (MACs) regarding Medicare bad debts.
On December 19, 2022, the Government Accountability Office (GAO) published a report entitled, Medicare: CMS Needs to Address Risks Posed by Provider Enrollment Waivers and Flexibilities. GAO conducted this study to describe the 47 Medicare waivers and flexibilities CMS issued in response to the COVID-19 pandemic, changes in Medicare provider enrollment as a result of these waivers and flexibilities, and CMS's oversight of the waivers and flexibilities. GAO found that the waivers addressed various areas to support Medicare's provider workforce and beneficiary access to care during the pandemic. GAO also found that about 220,000 providers enrolled under waivers and flexibilities from March 2020 through March 2022, which included a small percentage of suppliers. Finally, GAO determined that although CMS did take several steps to provide oversight of the flexibilities, such as monitoring providers' enrollment and billing information for potential fraud, CMS did not fully address all potential sources of risk, such as revalidating provider eligibility.
On December 19, 2022, GAO released a report entitled, Cancer Clinical Trials: Federal Actions and Selected Non-Federal Practices to Facilitate Diversity of Patients. Diverse representation in clinical trials is essential for determining the safety and efficacy of treatments for all patients. As such, GAO studied (1) actions federal agencies have taken to facilitate enrollment of patients from diverse backgrounds in cancer clinical trials and (2) practices used by selected non-federal cancer centers to facilitate enrollment of patients from diverse backgrounds in cancer clinical trials. GAO found that both select federal agencies and non-federal cancer centers took action to facilitate and enhance patient participation in cancer clinical trials from diverse backgrounds. For example, federal agencies created networks of community-based research sites and standardized data collection and non-federal cancer centers provided trainings to improve the diversity of their workforce and used community ambassadors to increase awareness of cancer clinical trials in their communities.
On December 19, 2022, GAO published a report entitled, Drug Control: Office of National Drug Control Policy Met Some Strategy Requirements but Needs a Performance Evaluation Plan. The Substance Use-Disorder Prevention that Promotes Opioid Recovery and Treatment for Patients and Communities Act (SUPPORT Act) includes a provision for GAO to review the Office of National Drug Control Policy’s (ONDCP) programs and operations. As such, this report assesses the extent to which ONDCP followed processes for developing the 2022 National Drug Control Strategy and the extent to which the 2022 Strategy adhered to selected statutory requirements. GAO found that the 2022 Strategy varies in level of compliance with statutory requirements. For example, the Strategy only partly addressed requirements for identifying resources for the treatment of substance use disorders (SUDs) and did not address requirements for future planning. GAO also noted that ONDCP had not created a standardized data collection process as required by statute.
On December 19, 2022, the Congressional Research Service (CRS) published a report entitled, Finding Medicare Fee-For-Service (FFS) Payment System Rules: Schedules and Resources. CRS notes that Medicare FFS payment systems are updated annually through regulations, which impact payments received by health care facilities and providers, and can be difficult to track. Payment systems under Medicare FFS that are updated annually include but are not limited to: the Medicare Physician Fee Schedule Payment (MPFS or PFS), the Hospital Outpatient Prospective Payment System (OPPS), the Acute Inpatient Prospective Payment System (IPPS), the Long-Term Care Hospital Prospective Payment System (LTCH PPS), and the End Stage Renal Disease Prospective Payment System (ESRD PPS). As such, CRS created a reference table to compile the payment systems, portals on the CMS website, typical rulemaking schedule, statutory requirements, and most recent proposed and final rules.
On December 21, 2022, HHS OIG published a report entitled, Mandated Analysis of Home Health Service Utilization From January 2016 Through March 2022. The Bipartisan Budget Act of 2018 requires OIG to complete an analysis of Medicare home health claims and utilization of home health services by county. As such, OIG audited $109,389,663,042 in Medicare payments to home health agencies (HHAs) for 45,417,624 claims. Overall, OIG found that: (1) beneficiary utilization of home health services decreased in “high utilization” and “other” urban and rural counties, (2) the number of home health episodes decreased for all urban and rural county categories, and (3) beneficiary utilization of home health services in the "low population density" category remained steady. OIG notes that they were unable to assess utilization using Federal Information Processing Standards (FIPS) data because the FIPS data was incomplete, which OIG suspects may be due to the fact that providers were not accurately capturing FIPS codes in claims nor MACs take steps to correct inaccurate FIPS codes. As such, OIG recommends that CMS work with MACs and update the HH Pricer logic to check for missing and invalid FIPS codes on all home health claims and reeducate providers on FIPS coding.

III. Other Health Policy News

On December 19, 2022, the Biden Administration released a federal plan for ending homelessness that starts with reducing homelessness 25 percent by 2025. The report entitled, All In: The Federal Strategic Plan to Prevent and End Homelessness, is a federal effort to combat homelessness and systemic racism that results in disparities in homelessness. The federal plan reinforces the Biden Administration’s commitments towards strategies such as: (1) the “Housing First” model of care that treats housing as the immediate solution to homelessness, and then provides long-term support services to ensure housing stability such as job training; (2) educational webinars to help community-based partners use All In to develop local and systems-levels plans to end homelessness; (3) improved data collection and evidence-based decision making to combat homelessness; (4) and preventative measures to ensure better systems are in place that prevent people from losing their home in the first place. More information on this announcement can be found here.
On December 19, 2022, CMS released a fact sheet on a proposed rule entitled, Adoption of Standards for Health Care Attachments Transactions and Electronic Signatures, and Modification to Referral Certification and Authorization Transaction Standard. This rule would implement requirements of the Administrative Simplification subtitle of the Health Insurance Portability and Accountability Act of 1996 (HIPAA) and the Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act of 2010, enacted on March 30, 2010—collectively, the Affordable Care Act. Specifically, the rule would adopt standards for “health care attachments” transactions, which would support health care claims and prior authorization transactions; adopt standards for electronic signatures to be used in conjunction with health care attachments transactions; and adopt a modification to the standard for the referral certification and authorization transaction. The CMS fact sheet on the rule can be found here.
On December 19, 2022, HHS announced the agency’s annual release of the Department's National Plan to Address Alzheimer's Disease. Through the National Plan, HHS and its federal partners work to improve Alzheimer’s disease and related dementias (ADRD) research, support people living with dementia and their caregivers, and encourage and educate on preventative action. The 2022 report details several actions taken this year, including: (1) initiatives to address disparities in ADRD, such as the Indian Health Service’s (IHS) Alzheimer’s Grant Program; (2) actions to reduce risk factors for ADRD, such as the Food and Drug Administration’s (FDA) final rule establishing over-the-counter hearing aids; and (3) investment in public health strategies to address ADRD risk factors, such as the CDC’s National Summit on Dementia Risk Reduction. More information on this announcement can be found here.
On December 20, 2022, HHS released ownership data for all Medicare-certified hospitals as part of the Biden Administration’s continued efforts to promote competition and transparency and protect consumers. This new information details ownership details such as hospitals’ enrollment information and their CMS Certification Number (CCN), and type of owner by organization or individual, as well as by direct or indirect ownership for more than 7,000 Medicare-certified hospitals. Increased transparency for hospital ownership data is hoped to not only ensure beneficiaries enjoy expanded access to high-quality, affordable health care, but also to help beneficiaries, researchers, and other stakeholders track poor performance by common owner, analyze how market trends such as consolidation affect quality of care, and hold facilities accountable. HHS plans to use this data to improve competition in health care and quality of health care. More information on this announcement can be found here.
On December 21, 2022, HHS, through the Administration for Strategic Preparedness and Response (ASPR), announced the expansion of Tamiflu supply, to be administered through the Strategic National Stockpile (SNS), to help communities respond to increased demand for the antiviral during the influenza (flu) season. These efforts aim to improve the health and wellbeing of communities while reducing burden on the health care system or compromising the U.S.’ preparedness for a future pandemic flu. This announcement also comes at a particularly concerning winter season that is seeing a confluence of COVID-19, flu, and respiratory syncytial virus (RSV) resulting in high demands for medicines and health care. More on this announcement can be found here.
On December 23, 2022, Congress passed a funding bill, also known as an omnibus, to fund federal government operations and agencies for 2023. The $1.7 trillion government funding package includes defense funding, emergency assistance to Ukraine and the North Atlantic Treaty Organization (NATO) allies, measures to help individuals save for retirement, and several other provisions. Health-specific provisions include various changes to federal programs, including: expanding mental health and substance use disorder services; preparing for and preventing future pandemics and public health emergencies; establishing the Advanced Research Projects Agency for Health (ARPA-H); authorizing FDA programs for several years and expanding Medicare and Medicaid payments and programs; improving diversity in clinical trials; providing Medicare Part B coverage of compression garments for the treatment of lymphedema; extending the Children's Health Insurance Program (CHIP) through 2029 and ensuring 12 months of continuous coverage for children and postpartum women and children; and extending COVID-19 telehealth flexibilities through 2024. Stakeholders are hopeful the President will be able to sign the bill into law by the end of the day on Friday, December 23, 2022, when current government funding is set to expire. More information on the omnibus can be found here.

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