Washington Healthcare Update

April 20, 2020

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This week in Washington: The House plans to reconvene May 4, Senate Democrats request information from Kushner on health data collection.



Proposed Regulations/Guidance

Final Regulations/Guidance




Democrats Request Information from Kushner on Health Data Collection

On April 10, Sens. Mark Warner (D-VA) and Richard Blumenthal (D-CT) and Rep. Anna Eshoo (D-CA) sent a letter requesting information from the Trump administration on White House Senior Advisor Jared Kushner’s working with technology companies to use health data for a national coronavirus surveillance system. The letter supports the Department of Health and Human Services’s (HHS) recent move to ease the Health Insurance Portability and Accountability Act’s (HIPAA) rules, but notes “these extraordinary measures could undermine the confidentiality and security of our health information and become the new status quo.”

Find the letter here.


HHS Notice of Benefit and Payment Parameters for 2021 Reaches OMB

As of April 17, the Department of Health and Human Services (HHS) Notice of Benefit and Payment Parameters for 2021 is under review at the Office of Management and Budget (OMB).

Find more information here.

FDA Wants to Develop Master Protocol for COVID-19 Vaccine Trials; Adds COVID-19 Could Affect User Fee Goals

On April 16, the Food and Drug Administration (FDA) Commissioner, Stephen Hahn, announced that the FDA wants to develop a master protocol for COVID-19 vaccine clinical trials so that multiple vaccines can be developed more efficiently. Hahn added that the FDA might consider relaxing direct-to-consumer (DTC) advertising for any future FDA-approved COVID-19 drugs, if it is decided that the value and the benefits outweigh the risks. Hahn also commented that the FDA continues to meet its user fee commitments but signaled that could change due to staffers’ focusing on COVID-19, coming as FDA is unable to hold in-person user fee negotiations and has postponed indefinitely its medical device user fee meeting.

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 Proposes 2.9 Percent Pay Increase for Inpatient Rehab Facilities

On April 16, the Centers for Medicare and Medicaid Services (CMS) released a proposal to increase pay for inpatient rehabilitation facilities in fiscal 2021, lift the requirements for postadmission evaluations and allow nonphysician practitioners to provide more services. CMS proposes to increase the inpatient rehabilitation facility payment by 2.9 percent, and proposes to maintain outlier payments at 3 percent of total payments. CMS says this would be an overall $270 million increase in fiscal 2021 relative to fiscal 2020. The proposal includes adoption of the Office of Management and Budget’s (OMB) statistical area delineations and would apply a 5 percent cap on wage index decreases from fiscal 2020 to fiscal 2021.

Find the proposed rule here. Public comments are due by June 15, 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: Temporary Policy for Compounding of Certain Drugs for Hospitalized Patients by Outsourcing Facilities during the COVID-19 Public Health Emergency

On April 16, the Food and Drug Administration (FDA) issued a temporary policy allowing outsourcing facilities to compound drugs needed to treat hospitalized COVID-19 patients, even if the medication is not on the FDA’s bulk shortage list. The guidance lists 13 drugs used for hospitalized coronavirus patients that can be compounded and FDA announced it will continually update the list.

Find the temporary guidance and list here.

FDA Extends Real-World Evidence Funding Application Deadline to June 5

As of April 15, the Food and Drug Administration (FDA) extended the deadline to apply for its real-world evidence (RWE) funding project, which FDA launched April 7 to increase available data for potential COVID-19 treatments. Under the program, academic institutions, nonprofits, for-profits, governments, tribal organizations and other institutions are eligible to receive funding for projects that explore the use of RWE and real-world data (RWD). The original deadline for organizations to submit applications was May 11, but FDA has extended the deadline to June 5.

FDA: Final Guidances on Chloroquine-Based Drugs

On April 17, the Food and Drug Administration (FDA) finalized two product-specific guidances for hydroxychloroquine sulfate and chloroquine phosphate for generic drug development, for clinical trials and observational studies to explore whether either therapy could work as a treatment for COVID-19. In some cases, FDA will let sponsors skip in vivo studies, according to the guidances. The hydroxychloroquine guidance finalizes FDA’s April 2011 guidance of the same name, “Guidance on Hydroxychloroquine Sulfate.” The second document, “Guidance on Chloroquine Phosphate,” is being published as final guidance.

Find the final guidances here.

CMS: Implementation of Free COVID-19 Testing, Diagnostics Coverage

On April 11, the Centers for Medicare and Medicaid Services (CMS) released guidance implementing a new requirement that health plans provide cost-free testing and diagnostic services for COVID-19, following provisions from the Coronavirus Aid, Relief, and Economic Security Act (CARES Act). The guidance confirms that the requirement applies to most insurance products, aside from short-term plans and excepted benefits, and that it applies to antibody tests.

Find the guidance here.


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

States Motion for SCOTUS to Temporarily Stop Public Charge Rule during COVID-19 Pandemic

On April 13, three states, New York, Connecticut and Vermont, motioned the Supreme Court for a temporary halt to the Trump administration’s enforcement of the public charge rule. The states say the emergence of the COVID-19 pandemic has exacerbated the health problems caused by the public charge rule and provides reasons for SCOTUS to revise the court’s ruling and pause the rule’s enforcement.

Find the motion here.


GAO: Preventing Drug Diversion – Disposal of Controlled Substances in Home Hospice Settings

On April 14, the Government Accountability Office (GAO) released a report describing selected home hospices’ disposal practices of commonly misused controlled substances, such as oxycodone, when hospice patients die at home. A 2018 law allows employees of qualified hospice programs to collect and destroy these drugs. Hospice representatives identified best practices such as having a disposal witness and using lock boxes to limit drug access. Challenges include the cost of certain disposal methods, a lack of required disposal witnesses and inconsistencies between state and federal laws over which hospice employees may dispose of controlled substances.

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

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