Washington Healthcare Update

April 13, 2020

Pardon Our Dust

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This week in Washington: The Senate reconvenes April 13 to continue negotiations on the next COVID-19 stimulus package; the House is expected to reconvene April 20.


Proposed Regulations/Guidance

Final Regulations/Guidance




Trump Administration: Hospitals and Doctors Receiving Stimulus Funding Cannot Send Patients Surprise Bills

On April 9, the Trump administration announced that hospitals receiving money from the $2 trillion stimulus bill will have to agree not to send “surprise” medical bills to patients treated for COVID-19. The stimulus bill includes $100 billion for the health care system, and release of the first $30 billion, aimed at hospitals, is expected soon. Hospitals that accept the grants will have to certify that they will not try to collect more money than the patient would have otherwise owed if the medical attention had been provided in network.

Find more details from the McGuireWoods team here.

Proposed Regulations/Guidance

DEA: Controls to Enhance the Cultivation of Marijuana for Research in the U.S.

On March 20, the Drug Enforcement Agency (DEA) released a proposed rule for adding additional research marijuana growing licenses. The only research-grade medical marijuana currently grown in the U.S. is at the University of Mississippi, while 37 prospective producers have applied for and are awaiting decisions on their applications to grow research marijuana.

Find the proposed rule here. Public comments are due by May 22, 2020.

FDA: Change in Safety Requirements for Diabetic Drugs

On March 9, the Food and Drug Administration (FDA) released a draft guidance to no longer require drug manufacturers to conduct large cardiovascular safety studies for all new type 2 diabetes therapies. The FDA is recommending new safety requirements that will focus on evaluations that are broader than heart disease. Companies will need to include at least 4,000 patients exposed to the drug in phase III clinical trials, with at least 1,500 patients exposed to the drug for at least one year and 500 patients exposed to the drug for at least two years.

Find the draft guidance here. Public comments are due by June 8, 2020.

CMS: Comprehensive Care for Joint Replacement (CJR) Model Proposed Extension andChanges

On Feb. 20, the Centers for Medicare and Medicaid Services (CMS) issued a rule that proposes a three-year extension and changes to the episode definition and pricing in the Comprehensive Care for Joint Replacement (CJR) Model. The Model, which is currently scheduled to end on Dec. 31, 2020, aims to reduce expenditures while preserving or enhancing quality of care by supporting better and more efficient care for beneficiaries undergoing the most common inpatient surgeries for Medicare beneficiaries: hip and knee replacements (also called lower extremity joint replacements or LEJR).

This rule proposes to change certain aspects of the CJR Model, including incorporating outpatient hip and knee replacements into the episode of care definition, the target price calculation, the reconciliation process, the beneficiary notice requirements, gainsharing caps and the appeals process. Additionally, to allow time to evaluate the proposed changes, the rule proposes to extend the length of the CJR Model for an additional three years, through Dec. 31, 2023, for certain participant hospitals.

Find the proposed rule here. Public comments are due by April 24, 2020.

Final Regulations/Guidance

FDA Grants Emergency Use to Blood Cleaning Device for Coronavirus

On April 10, the Food and Drug Administration (FDA) granted emergency use authorization for a blood purification system intended for coronavirus patients whose immune systems overreact to the virus. The system has components made by Terumo BCT and Marker Therapeutics and is intended for adults admitted to intensive care who are experiencing or have impending respiratory failure.

HHS, FEMA Ask States to Take Control of Drive-Through Testing Sites

On April 9, the Department of Health and Human Services (HHS) and the Federal Emergency Management Agency (FEMA) released a memo wanting states to consider taking control of drive-through coronavirus testing sites, currently run by HHS and FEMA, that have tested more than 77,000 people to date. HHS officials reiterated that the federal government will continue to operate the sites if governors request such assistance, and said that HHS would not hold states to the deadline listed in the memo from last week.

Find the memo here.

HHS Waives HIPAA Penalties at Community-Based Testing Sites

On April 9, the Department of Health and Human Services (HHS) Office for Civil Rights loosened its enforcement of Health Insurance Portability and Accountability Act (HIPAA) rules, announcing it will not impose penalties on covered entities or business associates that exercise good faith at COVID-19 testing sites, during the pandemic. The enforcement discretion is effective immediately and is retroactively applied to March 13, 2020. The announcement is meant to allow certain covered providers, including large pharmacy chains, and their business associates to participate in community based-testing sites.

Find more details here.

HHS: Guidance for Licensed Pharmacists, COVID-19 Testing, and Immunity under the PREP Act

On April 8, the Department of Health and Human Services (HHS) released guidance that states pharmacists will qualify as “covered persons” under the Public Readiness and Emergency Preparedness (PREP) Act, and they may receive immunity with respect to claims for loss caused by, arising out of, relating to or resulting from the administration or use of FDA-authorized COVID-19 tests. The guidance does not change reimbursement policy regarding whether a licensed pharmacist can get reimbursed from a government or private payer for ordering or administering an FDA-authorized test.

Find the final guidance here.

CMS: Open Payments Dispute Timeframe Will Not Change Due to COVID-19

On April 8, the Centers for Medicare and Medicaid Services (CMS) announced that despite the COVID-19 pandemic, statutory requirement for Open Payments data publication and resource constraints limit CMS’s ability to deviate from the established schedule. Therefore, the covered recipient pre-publication review and dispute period will remain April 1-May 15, 2020.

CMS: No Changes to Interest on Accelerated Medicare Pay

On April 7, the Centers for Medicare and Medicaid Services (CMS) responded to hospitals’ asking CMS to waive or lower the interest on advanced payments that providers request under the Medicare accelerated pay program. CMS announced that it does not have the authority to waive or change the interest rate on Medicare debts, including those repayments. The response also added that hospitals would have a year before the 10.25 percent interest rate kicks in.

FCC Approves Plan for $200 Million COVID-19 Telehealth Program

On April 3, the Federal Communications Commission (FCC) approved a plan to use $200 million allocated by Congress for a grant program for hospitals and health system providers aiming to use telehealth in their COVID-19 response. The FCC will begin reviewing applications today, April 13. The $200 million comes from the third coronavirus stimulus package signed into law on March 27. Providers would be able to use a streamlined application to apply for funding to fully cover their telehealth needs, from broadband connectivity to devices.

Eligible providers may be in postsecondary education programs, including teaching hospitals, community health centers, local health departments or agencies, community mental health clinics, nonprofit hospitals, rural health clinics and skilled nursing facilities. Providers that are selected would not be responsible for the costs of their telehealth projects, officials said, and would be accepted on a rolling basis until funds are exhausted or the pandemic ends.

Keep updated on the FCC response to telehealth and COVID-19 here.


Find a comprehensive look at “Courts and Healthcare Policy in 2020” here.


CBO and JCT: Preliminary Cost of H.R. 6201, Families First Coronavirus Response Act

On April 2, the Congressional Budget Office (CBO) and the Joint Committee on Taxation released an initial estimate of the cost of the Families First Coronavirus Response Act. The bill will increase the federal deficit by $192 billion through 2030, mostly over the next two years.

This estimate includes:

  • $2.4 billion increase in discretionary spending from emergency supplemental appropriations;
  • $95 billion increase in mandatory outlays; and
  • $94 billion decrease in revenues.

Find the full report here.


GAO: Maternal Mortality – Trends in Pregnancy-Related Deaths and Federal Efforts to Reduce Them

On April 7, the Government Accountability Office (GAO) released a report describing the Department of Health and Human Services’ (HHS) ongoing efforts to prevent deaths of women in the U.S. that are related to pregnancy and childbirth. For example, HHS funds committees in 25 states that comprehensively review maternal mortality and identify ways to prevent it. Officials in the five states where GAO interviews said they were beginning or continuing to address racial/ethnic health differences in maternal mortality rates.

Find the full report here.

GAO: Science and Tech Spotlight – CRISPR Gene Editing

On April 7, the Government Accountability Office (GAO) released a report spotlighting how scientists are using CRISPR, a gene editing technology that allows scientists to make specific, targeted changes to DNA, to develop treatments for medical conditions. These possible treatments include for blindness and some cancers, and the research can lead to the creation of tests to rapidly identify COVID-19 and other infections. CRISPR may also be used to strengthen crops, develop new biofuels and more.

Find the full report.

GAO: FDA Drug Approval – Application Review Times Largely Reflect FDA Goals

On April 6, the Government Accountability Office (GAO) released a report that reviews 637 new drug applications to the Food and Drug Administration (FDA) submitted from FY 2014-2018, and found that FDA met its goals to complete at least 90 percent of these reviews within deadlines that vary depending on the drug. Differences in review times among FDA’s 17 divisions were largely driven by the characteristics of the applications being reviewed.

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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