Washington Healthcare Update

October 21, 2019

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This week in Washington: House to hold a markup of five healthcare bills, as well as a hearing to seek clarity on the Trump administration’s health care policy choices; Senate to discuss solutions to the substance misuse concern in the U.S.

Upcoming Hearings/Markups






Proposed Regulations/Guidance



Upcoming Hearings/Markups

Tuesday, Oct. 22, 2019

House Ways and Means Committee: “Markup of Health Legislation”

The House Ways and Means committee will hold a markup of five healthcare bills, including H.R. 3, Speaker Pelosi’s government negotiation drug pricing plan. This is the last markup of H.R. 3 before a vote on the House floor.

The legislation to be marked up:

  • H.R. 3398, The Pathways to Health Careers Act of 2019
  • H.R. 3, The Lower Drug Costs Act Now Act of 2019
  • H.R. 4650, The Medicare Dental Act of 2019
  • H.R. 4665, The Medicare Vision Act of 2019
  • H.R. 4618, The Medicare Hearing Act of 2019

Find more on the markup here.

Wednesday, Oct. 23, 2019

House Energy and Commerce Committee: “Sabotage: The Trump Administration’s Attack on Health Care”

The Subcommittee on Oversight and Investigations of the Committee on Energy and Commerce will hold a hearing to seek clarity on the Trump administration’s health care policy choices. The Centers for Medicare and Medicaid (CMS) Administrator Seema Verma will be testifying at the hearing.

Find more details on the hearing as they become available here.

Thursday, Oct. 24, 2019

Senate Committee on Finance: “Treating Substance Misuse in America: Scams, Shortfalls, and Solutions”

The Senate Committee on Finance will hold a full committee hearing on solutions to the substance misuse concern in the United States. Witnesses include the surgeon general, Dr. Jerome M. Adams; the director of Health Care at the Government Accountability Office (GAO), Dr. Mary Denigan-Macauley; and the deputy inspector general for Investigations at the Department of Health and Human Services (HHS), Gary L. Cantrell.

Find more details on the hearing as they become available here.



House Ways and Means Committee: “Investing in the U.S. Health System by Lowering Drug Prices, Reducing Out-of-Pocket Costs, and Improving Medicare Benefits”

The House Ways and Means Committee held a hearing on prescription drug pricing costs, as well as discussing the government drug price negotiation plan released by House Speaker Nancy Pelosi (D-CA), H.R. 3. The Ways and Means Committee is one of the committees with jurisdiction on the topic, and Chair Richard Neal (D-MA) is a cosponsor of H.R. 3.

Find more details on the hearing here.

Find the Congressional Budget Office (CBO) report on H.R. 3 here.

House Energy and Commerce Committee: “Markup of H.R. 3, H.R. 4665, H.R. 4671, H.R. 4618, H.R. 4650”

The House Energy and Commerce Committee held a markup of H.R. 3, the Lower Drug Costs Now Act of 2019. The remaining four bills considered offered reforms to the Medicare program. Republican members of the committee noted that regular order has been avoided and that a subcommittee markup was skipped, seemingly “rushing” H.R. 3.

The lengthy debate was on H.R. 3, with full Democratic support, while Republican members introduced a handful of amendments in order to display their opposition. These amendments fought back on the international drug-pricing index of H.R. 3, as well as generally calling the negotiation bill a “price-setting” bill. Republican members were also concerned that the remaining four Medicare bills did not have a hearing before a vote—amendments were not made, yet there was an emphasis on the partisan nature of the debate. All offered legislation was favorably reported to the House.

Prior to the markup changes were made to HR 3 and offered as a substitute. The most notable changes in the substitute amendment included increasing the number of drugs subject to negotiation and that a drug would remain eligible for price negotiations until there were two generics on the market. Changes were coordinated among the three committees with jurisdiction. Energy and Commerce also made a change related to the 340B program, which is in its jurisdiction.  

Find more details on the markup here.

House Education and Labor Committee: “Markup of H.R. 3, Lower Drug Costs Now Act of 2019”

The House Education and Labor Committee held a markup of H.R. 3, the Lower Drug Costs Now Act of 2019. Chairman Bobby Scott (D-VA) offered an amendment in the nature of a substitute, with changes that were coordinated with the Ways and Means, and Energy and Commerce committees’ jurisdiction. The amendment was adopted by voice vote.

The committee adopted four other amendments offered by Democrats. Amendments offered by Republicans failed. The adopted amendments would require that the copayment for a drug under participating employer plans not exceed the negotiated price, have a requirement for federal investigators to examine the effects of price negotiation and have the extension of the inflation cap to employer plans. The amendments also ensure data collected under the bill is not duplicative.

Find more details on the markup here.


House Energy & Commerce, Education & Labor Pass Pelosi’s Drug Pricing Plan

On Oct. 17, the House Energy & Commerce and Education & Labor committees held markups on H.R. 3, Speaker Pelosi’s government drug pricing negotiation plan. The Energy & Commerce Committee favorably reported the bill, as amended, with a 30-22 vote to the House floor. The House Education & Labor Committee favorably reported the bill, as amended, with a 27-21 vote to the House floor. On the same day, the House Ways and Means Committee held a hearing on H.R. 3, and will hold its own markup of the bill soon. Then, the legislation from all three committees will be combined into one package for a House vote.


Grassley Questions UVA Health System on Billing Practices

On Oct. 17, Senate Finance Committee Chairman Chuck Grassley (R-IA) sent a letter to the University of Virginia (UVA) Health System after an investigation by Kaiser Health News (KHN) revealed that the UVA Health System filed 36,000 lawsuits for more than $106 million in six years. The UVA Health System is supported by taxpayer money as a state-funded entity.

In the letter. Sen. Grassley asked a variety of questions on topics including the system’s charity care (free or discounted care provided to low-income patients), debt collection policies and rationale for the litigation threshold of $1,000, enacted in 2017. Sen. Grassley also asked about UVA’s list of standard prices for procedures and equipment.

Find the full letter here.

Grassley, Wyden Publish Op-Ed: “Congress Can Act Now to Lower Drug Prices”

On Oct. 17, Senate Finance Chairman Chuck Grassley (R-IA) and Ranking Member Ron Wyden (D-OR) released an editorial piece entitled “Congress Can Act Now to Lower Drug Prices.” The piece advocates support for a bipartisan approach to redesigning Medicare Part D to lower prescription drug costs. The bill from Senate Finance leadership for this bipartisan solution, the Prescription Drug Pricing Reduction Act of 2019, passed the committee this summer with a two-thirds majority, and Sens. Grassley and Wyden add that it would lower beneficiaries’ premiums by $6 billion, reduce out-of-pocket costs by $25 billion and lower drug prices in the commercial market, according to the Congressional Budget Office (CBO).

Find the full editorial here.


CMS Further Updates Medicare Plan Finder Ahead of Open Enrollment

The Centers for Medicare and Medicaid Services (CMS) announced it made changes to an updated Medicare Plan Finder a week before its Medicare open enrollment on Oct. 15. These changes include allowing users to sort plans by the total cost of estimated drug costs plus premiums. The website also shows drug tier costs. Before the changes were made, Sens. Ron Wyden (D-OR) and Jeff Merkley (D-OR) were concerned that the website was released later than expected and did not allow beneficiaries to do comparisons of their prescription drug options like they could do before. The senators wanted CMS to have a way to gather feedback on the new website, as well as monitor problems that may arise for beneficiaries using the site.

Proposed Regulations/Guidance

SAMHSA: Proposed Rule to Loosen 42 CFR Part 2

On Aug. 22, the Substance Abuse and Mental Health Services Administration (SAMHSA) proposed a rule that would loosen substance use record privacy restrictions. The proposed rule is part of the Department of Health and Human Services’ (HHS) “Regulatory Sprint to Coordinated Care,” championed by HHS Deputy Secretary Eric Hargan. The rule is one of four expected as part of the sprint, including changes to the Health Insurance Portability and Accountability Act (HIPAA), the Stark Law and the anti-kickback statute. HHS Secretary Alex Azar commented that HHS does not have the authority to fully align 42 CFR Part 2 with HIPAA but expressed support in Congress for legislation to do so.

Find the proposed rule here. Public comments are due by Oct. 25, 2019.

OIG: Revisions to Safe Harbors Under the Anti-Kickback Statute, Etc.

On Oct. 9, the Department of Health and Human Services Office of Inspector General (OIG) proposed a rule that creates three new safe harbors for certain remuneration exchanged between or among eligible participants: care coordination arrangements aimed at improving quality and outcomes; value-based arrangements with substantial downside financial risk; and value-based arrangement with full financial risk. Modifications to existing AKS safe harbors include more flexibility for part-time and outcomes-based arrangements, removing the part-time schedule requirement and the aggregate compensation set-in-advance requirement. Modifications were also made to expand and modify mileage limits to rural areas and for transportation of patients discharged from inpatient facilities. As for electronic health records, the proposal extends the interoperability provision.

Find the proposed rule here.

Public comments must be submitted by Dec. 31, 2019.

CMS: Modernizing and Clarifying the Physician Self-Referral Regulations (Stark Law Rule)

On Oct. 9, the Centers for Medicare and Medicaid Services (CMS) proposed a rule that will create new, permanent exceptions to the Stark Law for value-based arrangements. These exceptions would apply broadly to care provided to all patients, not just Medicare beneficiaries. The proposed rule requires health care entities to provide written documentation that explains arrangements and patient populations being targeted, and the outcomes being measured in terms of value. There is a new exception to protect compensation not exceeding an aggregate of $3,500 per calendar year if certain conditions are met, for limited remuneration to a physician.

There is also a new exception for cybersecurity technology and related services, where CMS proposes protecting arrangements involving the donation of certain cybersecurity technology and related services. Modifications to compensation exceptions were added. There rules includes the expansion of the 90-day grace period for writing requirements. CMS proposed the deletion of goal posts for when an entity knows the period of disallowance ended. And, the proposal includes modifying the physician contribution requirement to the electronic health records’ conditions and allowing certain donations of replacement technology.

CMS is soliciting comments about the role of price transparency in the context of the Stark Law and whether to require cost-of-care information at the point of a referral for an item or service.

Find the proposed rule here.

Public comments must be submitted by Dec. 31, 2019.

CMS: Proposed Radiation Oncology (RO) Model

On July 10, the Centers for Medicare and Medicaid Services (CMS) proposed a Radiation Oncology (RO) Model as a payment model that tests if site-neutral payments, in which providers are paid the same rate no matter the care setting, for a 90-day episode of care, can improve the quality of treatment and save Medicare money. The experiment targets radiation treatment for 17 different types of cancer. Payment will be based on proposed national base rates and trend factors and will be adjusted for geography and the mix of patients the provider treats.

Participants in the model could earn back a share of dollars that are withheld based on the quality of care and patient experience. The model is scheduled to begin next year and end in December 2024.

Find the proposed rule here.

FDA: Patient-Focused Drug Development: Methods to Identify What Is Important to Patients’ Guidance

On Sept. 30, the Food and Drug Administration (FDA) released a second draft guidance in a series of four patient-focused drug development guidances, as required under the 21st Century Cures Act. The series looks at how to collect and submit information from patients and caregivers for medical product development and regulatory decision-making. This draft guidance explains three research methods to do so: qualitative research, quantitative research and mixed-method research.

Find the draft guidance here.

Public comments must be submitted by Dec. 30, 2019.


GAO Makes PTAC Appointments

On Oct. 15, Gene L. Dodaro, Comptroller General of the United States and head of the U.S. Government Accountability Office (GAO), announced the appointment of a new member to the Physician-Focused Payment Model Technical Advisory Committee (PTAC). He also reappointed two current members. The newly appointed member is Charles DeShazer, M.D., Senior Vice President and Chief Medical Officer of Highmark Health Plan, located in Pittsburgh, PA.

The reappointed members, whose terms will also expire in October 2022, are Paul N. Casale, M.D., M.P.H., interventional cardiologist and Executive Director, New York Quality Care, and Bruce Steinwald, M.B.A., private consultant.

Find the announcement here.

Medicaid and CHIP Payment and Access Commission (MACPAC) October Meeting

MACPAC will meet on Oct. 31–Nov. 1, 2019, at the Ronald Reagan Building and International Trade Center.


GAO: VA Health Care – Actions Needed to Ensure Provider Qualifications and Competence

On Oct. 16, the Government and Accountability Office (GAO) released a report on the Department of Veterans Affairs’ (VA) requirement that its medical centers review doctors’ qualifications and practice history before deciding whether to hire or retain them. The GAO found that some VA medical centers inadvertently overlooked information that would disqualify a doctor from being hired, such as having a revoked license. If medical centers are concerned about or have disciplined a doctor, they are required to report to state licensing boards or a national database as appropriate. The GAO found that some medical centers did not make these reports. GAO made 11 recommendations in its February 2019 and November 2017 reports to address the deficiencies identified. VA implemented two of these 11 recommendations, and provided action plans to address the other nine recommendations.

Find the full report here.

If you have any questions, contact the following individuals atMcGuireWoods Consulting:

Stephanie Kennan, Senior Vice President
Mariam Eatedali, Research Associate

Founded in 1998,McGuireWoods Consulting LLC(MWC) is a full-service public affairs firm offering infrastructure andeconomic development, strategic communications & grassroots, and governmentrelations services. McGuireWoods Consulting is a subsidiary of theMcGuireWoods LLPlaw firm and has been named in The National Law Journal’s special annualreport, “The Influence 50,” for the past several years. In the most recentreport, McGuireWoods Consulting was ranked 15th of the 1,900 governmentrelations firms in Washington, D.C.

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