Washington Healthcare Update

April 28, 2014

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1. Congress

House of Representatives

  • District Work Period — No Legislative Activity


  • State Work Period — No Legislative Activity

2. Administration

3. State Activities

4. Regulations Open for Comment

5. Reports

1. Congress


District Work Period — No Legislative Activity


State Work Period — No Legislative Activity

2. Administration

CMS Announces Special Enrollment Period for Pre-Existing Condition Insurance Program Participants

On April 24, CMS announced the creation of a special enrollment period for individuals losing coverage through the Pre-Existing Condition Insurance Program (PCIP) extending through April 30, 2014. While the majority of enrollees transitioned out of PCIP coverage on Jan. 1, 2014, the Secretary determined that an extension of PCIP coverage was necessary to avoid a lapse in coverage for PCIP enrollees who, on Jan. 1, 2014, were not yet enrolled in other coverage. The open enrollment period for enrollment in an individual Marketplace plan for the 2014 coverage year ended on March 31, 2014. In order to ensure that eligible individuals who are losing coverage through PCIP by virtue of the program’s termination can avoid a lapse in coverage, CMS is providing a special enrollment period for enrollment in a qualified health plan offered through the Federally-facilitated Marketplace in 2014. Specifically, PCIP enrollees may contact the Marketplace Call Center before May 1, 2014, to begin the application process. PCIP enrollees will have until June 30, 2014, to select a plan. If the consumer is otherwise eligible to enroll in a qualified health plan, coverage will be effective back to May 1 for anyone who uses this special enrollment period. Consumers who are Medicaid eligible may enroll throughout the year without a special enrollment period and will follow the Medicaid program’s rules on retroactive eligibility.

3. State Activities

Oregon Set to Transition to Federally-Facilitated Exchange

On April 25, the Cover Oregon board, responsible for operating the state’s broken health insurance exchange, voted unanimously to give up on its state-run model of exchange, and instead hand control over to the federal government. The move came after the board’s information technology team determined that a federally operated exchange would provide the smallest risk and cost, while ensuring that the exchange will be functional in November. The transition to a federal exchange is estimated to cost between $4 million to $6 million. Medicaid management will be converted from Cover Oregon to the state’s health authority. The state can reestablish a state exchange at any point. Despite its glitches, the state exchange had enrolled 45,119 customers as of April 10, Cover Oregon’s board reported. Next week, officials from Cover Oregon will be in DC to discuss details of the transition with CMS.

4. Regulations Open for Comment

FDA Proposed Rule on Deeming Tobacco Products To Be Subject to the Federal Food, Drug, and Cosmetic Act

FDA rel=”noopener noreferrer” has issued a proposed rule that would deem products meeting the statutory definition of “tobacco product,” except accessories of a proposed deemed tobacco product, to be subject to the Federal Food, Drug, and Cosmetic Act (the FD&C Act), as amended by the Family Smoking Prevention and Tobacco Control Act (Tobacco Control Act). The Tobacco Control Act provides FDA authority to regulate cigarettes, cigarette tobacco, roll-your-own tobacco, smokeless tobacco and any other tobacco products that the Agency by regulation deems to be subject to the law. Option 1 of the proposed rule would extend the Agency’s “tobacco product” authorities in the FD&C Act to all other categories of products, except accessories of a proposed deemed tobacco product, that meet the statutory definition of “tobacco product” in the FD&C Act. Option 2 of the proposed rule would extend the Agency’s “tobacco product” authorities to all other categories of products, except premium cigars and the accessories of a proposed deemed tobacco product, that meet the statutory definition of “tobacco product” in the FD&C Act. FDA also is proposing to prohibit the sale of “covered tobacco products” to individuals under the age of 18 and to require the display of health warnings on cigarette tobacco, roll-your own tobacco and covered tobacco product packages and in advertisements. FDA is taking this action to address the public health concerns associated with the use of tobacco products. Comments are due July 9, 2014.

CMS Proposed Rule on Life Safety Codes for Medicare, Medicaid rel=”noopener noreferrer” Providers

On April 14, 2014, CMS announced a proposed rule on the adoption of an updated life safety code (LSC) that CMS would use in its ongoing work to ensure the health and safety of all patients, family and staff in every provider and supplier setting. The updated code contains new provisions that are vital to the health and safety of all patients and staff. CMS intends to adopt the National Fire Protection Association’s (NFPA) 2012 editions of the (LSC) and the Health Care Facilities Code (HCFC), as the 2012 edition of the LSC also is aligned with the international building codes to make compliance across codes much simpler for Medicare- and Medicaid-participating facilities.

Currently, CMS applies the standards set out in the 2000 edition of the LSC to facilities in order to ensure patients’ and caregivers’ health and safety. CMS is now proposing to adopt the 2012 editions of the LSC and the Health Care Facilities Code. The LSC sets out fire safety requirements for new and existing buildings, and is issued by the NFPA, a private, nonprofit organization dedicated to reducing loss of life due to fire. The new edition of the LSC applies to: hospitals, long-term care facilities (LTC), critical access hospitals (CAHs), Programs for All-Inclusive Care for the Elderly (PACEĀ®), religious nonmedical healthcare institutions (RNHCIs), hospice inpatient facilities, ambulatory surgical centers (ASCs) and intermediate care facilities for individuals with intellectual disabilities (ICF-IIDs).

Comments are due June 16, 2014.

FDA Guidance With Comment Period for Human Compounding Outsourcing Facilities

On April 1, the Food and Drug Administration rel=”noopener noreferrer” (FDA) announced the availability of a guidance for industry entitled “Fees for Human Drug Compounding Outsourcing Facilities Under Sections 503B and 744K of the FD&C Act.” The guidance is intended for entities that compound human drugs and elect to register as outsourcing facilities (outsourcing facility) under Section 503B of the Federal Food, Drug, and Cosmetic Act (FD&C Act), as added by the Drug Quality and Security Act (DQSA). Entities that elect to register as outsourcing facilities must pay certain fees to be considered outsourcing facilities. This guidance describes the annual establishment fee, the reinspection fee, annual adjustments to fees required by law, how to submit payment, the effect of failure to pay fees and how to qualify as a small business to obtain a reduction of the annual establishment fee. Comments on the draft guidance must be submitted by June 2, 2014.

FDA Proposed Rule on Medical Device rel=”noopener noreferrer” Classification Procedures

On March 25, the Food and Drug Administration (FDA) issued a proposed rule to amend its regulations governing classification and reclassification of medical devices to conform to the applicable provisions in the Food and Drug Administration Safety and Innovation Act (FDASIA). FDA is also proposing changes unrelated to the new FDASIA requirements to update its regulations governing classification and reclassification of medical devices. FDA is taking this action to codify the procedures and criteria that apply to classification and reclassification of medical devices and to provide for classification of devices in the lowest regulatory class consistent with the public health and the statutory scheme for device regulation. Comments are due June 23, 2014.

Interim Final Rule – Patient rel=”noopener noreferrer” Protection and Affordable Care Act; Third-Party Payment of Qualified Health Plan Premiums

On March 19, HHS issued an interim final rule requiring issuers of qualified health plans (QHPs), including stand-alone dental plans (SADPs), to accept premium and cost-sharing payments made on behalf of enrollees by the Ryan White HIV/AIDS Program, other Federal and State government programs that provide premium and cost-sharing support for specific individuals, and Indian tribes, tribal organizations and urban Indian organizations. Comments will be accepted until May 18; however, the interim final rule is effective as of March 14, 2014.

rel=”noopener noreferrer” HHS Proposes Health Information Technology Certification Requirements

On Feb. 26, HHS published a notice of proposed rulemaking to introduce the beginning of the Office of National Coordinator for Health Information Technology’s (ONC’s) more frequent approach to health information technology certification regulations. Under this approach ONC intends to update certification criteria editions every 12 to 18 months in order to provide smaller, more incremental regulatory changes and policy proposals. The 2015 Edition EHR certification criteria proposed in this rule would be voluntary. No EHR technology developer who has certified its EHR technology to the 2014 Edition would need to recertify to the 2015 Edition in order for its customers to participate in the Medicare and Medicaid EHR Incentive Programs (EHR Incentive Programs). Furthermore, eligible professionals, eligible hospitals and critical access hospitals that participate in the EHR Incentive Programs would not need to “upgrade” to EHR technology certified to the 2015 Edition in order to have EHR technology that meets the Certified EHR Technology (CEHRT) definition. Instead, the 2015 Edition EHR certification criteria would accomplish three policy objectives: 1) They would enable a more efficient and effective response to stakeholder feedback; 2) they would incorporate “bug fixes” to improve on 2014 Edition EHR certification criteria in ways designed to make rules clearer and easier to implement; and 3) they reference newer standards and implementation specifications consistent with promoting innovation and enhancing interoperability.

Comments must be received by April 28, 2014.

5. rel=”noopener noreferrer” Reports

GAO: Department of Health and Human Services: Solicitations of Support for Enroll America

According to a recent GAO review of written responses and documentation from the Department of Health and Human Services (HHS), since enactment of the Patient Protection and Affordable Care Act (PPACA), the Secretary of HHS (the Secretary) contacted the Chief Executive Officers of five organizations to solicit support for one outside entity, Enroll America, involved in activities related to PPACA. Specifically, the Secretary requested financial support for Enroll America from the Robert Wood Johnson Foundation (RWJF) and H&R Block; and nonfinancial support, such as technical assistance, from Ascension Health, Johnson & Johnson and Kaiser (which consists of the Kaiser Foundation Health Plans and Kaiser Foundation Hospitals). GAO’s review of the documentation also found that the Secretary received oral guidance from HHS’s Office of General Counsel in early February 2013 and written guidance on soliciting support for outside entities later in the month, after the contact with RWJF but prior to the four remaining contacts. Among other things, this guidance stated that HHS officials may encourage members of the public to support certain organizations assisting Americans to enroll in coverage under PPACA, pursuant to authority provided under Sections 1703 and 1704 of the Public Health Service Act.

OIG: Medicare Improperly Paid Medicare Advantage Organizations Millions of Dollars for Unlawfully Present Beneficiaries for 2010 Through 2012

According to an April 23 HHS-OIG report, for calendar years 2010 through 2012, the Centers for Medicare & Medicaid Services (CMS) made $26.2 million in improper payments to Medicare Advantage (MA) organizations for approximately 1,600 unlawfully present beneficiaries. Specifically, CMS did not notify the MA organizations of the unlawful-presence information in its data systems. In the absence of such notification, MA organizations could not prevent unlawfully present beneficiaries from enrolling. For the same reason, MA organizations could not disenroll beneficiaries whose unlawful-presence status changed after they had enrolled. In contrast to its fee-for-service (FFS) program, CMS did not have policies and procedures to notify the MA organizations of the unlawful-presence information in its data systems. Had CMS provided this information to the MA organizations, they would have been able to prevent enrollment and to disenroll beneficiaries already enrolled. CMS would then have been able to recoup any improper payments. HHS-OIG recommends that CMS recoup the $26.2 million in improper payments in accordance with legal requirements; implement policies and procedures, consistent with those in effect under its FFS program, to notify MA organizations of unlawful-presence information and thereby prevent enrollment in MA organizations; disenroll beneficiaries already enrolled and recoup any improper payments; and identify and recoup improper payments made to MA organizations for unlawfully present beneficiaries after the audit period and until policies and procedures have been implemented that would ensure Medicare no longer pays for unlawful beneficiaries. CMS partially concurred with the recommendations.

If you have any questions, please contact Stephanie Kennan, Senior Vice President, or Brian Looser, Assistant Vice President, at McGuireWoods Consulting.

Founded in 1998, McGuireWoods Consulting LLC (MWC) is a full-service public affairs firm offering state and federal government relations, national/multistate strategies, infrastructure and economic development, strategic communications and grassroots issue management services. McGuireWoods Consulting is a subsidiary of the McGuireWoods LLP law firm and in 2010 was rel=”noopener noreferrer” ranked in the Top 20 of The National Law Journal‘s “The Influence 50,” an annual report of the top public affairs firms in Washington, D.C.

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