Washington Healthcare Update

July 20, 2020

Pardon Our Dust

We recently launched this new site and are still in the process of updating some of our archived content. Some details of this article may be incomplete, links may be broken, and other elements may not display properly yet. We appreciate your patience and understanding.

This week in Washington: Both the House and Senate return to session, discussions on the next COVID-19 package begin.

Upcoming Hearings/Markups





Proposed Regulations/Guidance

Final Regulations/Guidance




Upcoming Hearings/Markups

Tuesday, July 21, 2020

Senate Committee on Aging: The COVID-19 Pandemic and Seniors: A Look at Racial Health Disparities

The Senate Committee on Aging will hold a hearing on how the COVID-19 pandemic and racial health disparities are affecting the country’s seniors. Find more details on the hearing here.

House Committee on Energy and Commerce, Subcommittee on Oversight and Investigations: Pathway to a Vaccine: Efforts to Develop a Safe, Effective and Accessible COVID-19 Vaccine

The Subcommittee on Oversight and Investigations of the Committee on Energy and Commerce will hold a hearing to cover ongoing efforts to develop a COVID-19 vaccine. Operation Warp Speed finalists will testify on whether the rapid pace of vaccine development could lead to approvals of vaccines that are not up to the Food and Drug Administration’s (FDA) historical standards. AstraZeneca, Johnson & Johnson, Merck, Moderna and Pfizer will testify at the hearing. Find more details on the hearing here.


House to Consider Four-Bill Appropriations Minibus this Week

On July 16, in advance of House floor consideration, the House Appropriations Committee released the first minibus of fiscal year 2021 appropriations bills. The House is expected to consider the legislation, H.R. 7608, this week. The package includes four FY 2021 spending bills: State-Foreign Operations, Agriculture-Rural Development-FDA, Interior-Environment, and Military Construction and Veterans Affairs.

The Agriculture, Rural Development, Food and Drug Administration and Related Agencies bill funds THE Food and Drug Administration (FDA). For FY 2021, total discretionary funding in the legislation is $23.98 billion, an increase of $487 million above the FY 2020 enacted level. In total, the bill allows for $153 billion in both discretionary and mandatory funding, an increase of $331 million above the FY 2020 enacted level. The bill prioritizes important agricultural and food programs and services, including food and medical product safety, animal and plant health programs, rural development, farm services, agricultural trade, financial marketplace oversight and nutrition programs, both domestic and international.

Find more details here.

Bipartisan House Members Introduce the “Protecting Access to Post COVID-19 Telehealth Act”

On July 16, Rep. David Schweikert (AZ-06), co-chair of the Congressional Telehealth Caucus, along with caucus co-chairs Rep. Mike Thompson (D-CA), Rep. Peter Welch (D-VT), Rep. Bill Johnson (R-OH), and caucus member Rep. Doris Matsui (D-CA), announced the introduction of the Protecting Access to Post-COVID-19 Telehealth Act. This bipartisan bill will continue the expanded use of telehealth beyond the coronavirus pandemic by eliminating restrictions on the use in Medicare, providing a bridge for patients currently using the practices because of the crisis and requiring a study on the use of telehealth during COVID-19.

Find more details here.

Ways and Means Committee Chair Neal Releases Report Examining Inequities in American Health System

On July 14, the House Ways and Means Chairman Richard Neal (D-MA) released a staff report, titled “Left Out: Barriers to Health Equity for Rural and Underserved Communities,” that analyzes the barriers to health care in underserved communities and discusses the challenges associated with scalable and sustainable solutions. From massive geographic coverage deficiencies to structural environmental factors, the report examines the realities millions of Americans face that adversely affect their health. The report also takes a close look at how these challenges are biproducts of systemic racism and economic inequality.

Disparities and inequalities have only been exacerbated by the COVID-19 pandemic, the report says. For example, telehealth and other technology have been helpful during the pandemic for some, but it will not help if individuals do not have access to smartphones or broadband.

Find the report here.

Energy and Commerce Committee Sends 4 FDA Drug, Device and Labeling Policy Bills to House Floor

On July 15, the House Energy and Commerce Committee passed four bipartisan Food and Drug Administration (FDA) policy bills that would increase the FDA’s authority over imported counterfeit medical devices, stop gaming of certain orphan drug exclusivity provisions, boost use of continuous manufacturing and empower the FDA to require labeling updates for generic drugs. All bills cleared the committee by voice vote.

  • The Fairness in Orphan Drug Exclusivity Act (H.R. 4712), by Reps. Madeleine Dean (D-PA), Marc Veasey (D-TX), Buddy Carter (R-GA) and David McKinley (R-WV), would amend the cost recovery prong pathway under the Orphan Drug Act to require drug makers seeking orphan drug designations to demonstrate they do not expect to recoup development costs.
  • The National Centers of Excellence in Continuous Pharmaceutical Manufacturing Act (H.R. 4866), by Energy and Commerce Chair Frank Pallone (D-NJ) and Rep. Brett Guthrie (R-KY), would direct FDA to designate National Centers of Excellence in Continuous Pharmaceutical Manufacturing (NCEs) with the aim of increasing use of continuous manufacturing in drug development. NCEs would work with FDA and industry to craft a national framework for continuous manufacturing. The bill would authorize $80 million to be appropriated for NCEs each year from fiscals 2021 through 2025.
  • The Making Objective Drug Evidence Revisions for New (MODERN) Labeling Act (H.R. 5668), by Reps. Guthrie (R-KY) and Doris Matsui (D-CA), would give FDA authority to make drug companies update generic drug labeling.
  • The Safeguarding Therapeutics Act (H.R. 5663), by Reps. Guthrie (R-KY) and Eliot Engel (D-NY), would allow FDA to seize and destroy counterfeit medical devices that are refused admission at the border, if the devices are valued at an amount less than $2,500 or any higher amount set by the Department of the Treasury.

Find more details here.


Sen. Casey Says Republican Senators Should Increase Medicaid in Next COVID-19 Bill

On July 16, Sen. Bob Casey (D-PA) asked for provisions in the Health and Economic Recovery Omnibus Emergency Solutions (HEROES) Act that would bump the federal Medicaid match rate for states a second time to be included in the next coronavirus stimulus package. He said Senate Majority Leader Mitch McConnell (R-KY) does not include enough state aid in his proposal for the upcoming package. H.R. 6800, already passed in the House, would bump the Medicaid match to 14 percent starting July 1 through June 2021. The Families First Coronavirus Response Act initially bumped the match up by 6 percent.

Sen. Grassley Introduces the Updated Prescription Drug Pricing Reduction Act of 2020

On July 2, Senate Finance Committee Chairman Chuck Grassley (R-IA) reintroduced bipartisan legislation co-authored by Ranking Member Ron Wyden (D-OR), the Prescription Drug Pricing Reduction Act of 2020, which originally passed out of the committee on a bipartisan 19-9 vote. All provisions of this updated legislation have bipartisan support. Joining Grassley in introducing the bipartisan legislation as original co-sponsors are Sens. Rob Portman (R-OH), Bill Cassidy (R-LA), Steve Daines (R-MT), Joni Ernst (R-IA), Susan Collins (R-ME), Martha McSally (R-AZ), Mike Braun (R-ID), Cindy Hyde-Smith (R-MS) and Lisa Murkowski (R-AK).

Find the legislation here.


HHS Directs CDC to Put Coronavirus-Related Hospital Data Back on Its Website

On July 16, the Department of Health and Human Services (HHS) changed course on a controversial decision about hospital data, directing the Centers for Disease Control and Prevention (CDC) to re-post public hospital information onto its website. HHS had originally told hospitals to stop reporting the data on coronavirus hospitalizations to CDC, saying that CDC was posting the information too slowly.

HHS: Guidance Coming to Discourage “Unnecessary” Testing

On July 16, the Department of Health and Human Services (HHS) Assistant Secretary for Health Brett Giroir said that the Centers for Disease Control and Prevention’s (CDC) guidance is coming soon to dissuade what he called unnecessary COVID-19 testing. The guidance will discourage medical providers from re-testing COVID-19-positive patients. Giroir clarified that this guidance is meant to apply to COVID-19 patients who previously tested positive and are isolating at home.

HHS Will Send Point-of-Care Tests to 2,000 Nursing Homes

On July 14, the Department of Health and Human Services (HHS) will supply 2,000 nursing homes with COVID-19 point-of-care tests. HHS Assistant Secretary for Health Brett Giroir said HHS would send those 20 test-per-hour machines next week to regions most at risk, like Baton Rouge, LA, which will get 17 point-of-care tests.

Each nursing home will receive one diagnostic test instrument and associated tests, and can directly procure additional tests from the respective manufacturers, according to the press release. Nursing homes must have the ability to screen and test residents, while testing staff on a weekly basis or according to state and local health department guidance; the procurement could also allow for testing of nursing home visitors.

HHS Secretary Azar Aims to Keep Telehealth Waivers Permanently Though Pandemic

On July 9, the Department of Health and Human Services (HHS) Secretary Alex Azar said that HHS will do everything it can to permanently keep telehealth waivers granted during the pandemic. Azar said he is committed to pushing regulatory or legislative reforms to keep the COVID-19 telehealth flexibilities as hundreds of provider and patient organizations press HHS to continue telehealth waivers after the pandemic.

CMS Extends HCBS Compliance Timelines by One Year

On July 14, the Centers for Medicare and Medicaid Services (CMS) announced that states will have until March 17, 2023, to comply with the home and community-based services settings rule, yielding to an extension the Medicaid officials had requested in May due to conditions created by COVID-19. CMS urged states to also use the extra time to develop longer-term strategies.

Find the letter here.

Proposed Regulations/Guidance

CMS: Calendar Year 2021 Payment and Policy Changes for Home Health Agencies and Calendar Year 2021 Home Infusion Therapy Benefit

On June 25, the Centers for Medicare and Medicaid Services (CMS) proposed to permanently expand home health telehealth options, initially approved for use during the COVID-19 pandemic, as part of its proposed 2021 home health pay rule. The rule would also implement new wage index calculations while capping cuts that could be tied to those calculations. According to CMS, home health agencies would see a 2.6 percent Medicare pay bump under the rule. The proposal updates the home health wage index, but also includes a 5 percent cap on decreases in a geographic area’s wage index value for 2021.

Find the proposed rule here. Public comments are due by Aug. 31, 2020.

Final Regulations/Guidance

HHS: Finalized SUDs Privacy Rule

On July 13, the Substance Abuse and Mental Health Services Administration (SAMHSA), part of the Department of Health and Human Services (HHS), finalized the Confidentiality of Substance Use Disorder Patient Records regulation, 42 CFR Part 2. Under Part 2, a federally assisted substance use disorder (SUD) program may only disclose patient identifying information with the individual’s written consent, as part of a court order or under a few limited exceptions.

The revised rule does not alter the basic framework for confidentiality protection of SUD patient records created by federally assisted SUD treatment programs. Part 2 continues to prohibit law enforcement’s use of SUD patient records in criminal prosecutions against patients, absent a court order. Part 2 also continues to restrict the disclosure of SUD treatment records without patient consent, other than as statutorily authorized in the context of a bona fide medical emergency; or for the purpose of scientific research, audit or program evaluation; or based on an appropriate court order.

Find the finalized rule here.


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

Appeals Court Rules CMS Can Reduce Pay for Off-Campus Hospital Sites

On July 17, the District of Columbia federal appeals court ruled that the Centers for Medicare and Medicaid Services (CMS) has the authority to reduce reimbursement rates for outpatient clinic visits at certain off-campus hospital facilities in order to control the volume of services provided. The ruling reversed a lower court’s ruling that sided with hospitals in a challenge against the rule.

Appeals Court Upholds Trump Administration’s Short-Term Plan Rule

On July 17, the District of Columbia federal appeals court ruled 2-1 in favor of the Trump Administration’s short-term plan rule, upholding a district court ruling that found the Trump Administration did not overstep its authority in issuing the rule that allows the plans to run for up to three years. The plaintiffs, led by the Association of Community Affiliated Plans (ACAP), will ask the entire appeals panel to review the case.

Supreme Court to Hear PBM Case Oct. 6, 2020

On July 13, the Supreme Court docket showed that it would hear, on Oct. 6 of this year, a case over an Arkansas law restricting pharmaceutical benefit manager (PBM) conduct. Nearly 40 states have laws restricting PBM conduct as well. Arkansas enacted a law in 2015 to require that PBMs cover at least the price that pharmacies pay for drugs. The law also let pharmacies challenge PBMs’ reimbursement rates and allowed pharmacies to decline to dispense drugs on which they had lost money.

The Court of Appeals for the 8th Circuit struck the Arkansas law in 2018. The court ruled that the federal Employee Retirement Income Security Act preempted the law. Arkansas asked the Supreme Court to review the ruling, and more than 30 states and the Trump administration supported Arkansas’ appeal. The Supreme Court will determine whether the federal employee-benefits law supersedes state laws that dictate how much PBMs pay pharmacies.

The lawsuit is Rutledge v. Pharmaceutical Care Management.

Supreme Court Indicates ACA Oral Arguments Could Be Just Before, Or After, Election

On July 13, the Supreme Court docket showed that the hearing of the Affordable Care Act (ACA) case, California v. Texas, is still not scheduled. The omission means the case could still be heard either just before or on the Nov. 3 Election Day, or the court could add days to October or schedule the case later in the fall. The court also plans to hear cases on Nov. 4, 9, 10 and 30.


MedPAC Releases 2020 Data Book on Heath Care Spending and the Medicare Program

On July 17, the Medicare Payment Advisory Commission (MedPAC) announced the release of its 2020 data book on health care spending and the Medicare program. The publication provides data on Medicare spending, demographics of the Medicare population, beneficiaries’ access to care, and quality of care in the program, among other information.

Find the data book here.


GAO: Medicaid – Primer on Financing Arrangements

On July 14, the Government Accountability Office (GAO) published a report on ways states pay for their share of Medicaid, a program that finances health care for certain low-income people and others through a federal-state partnership. The federal government provides matching funds based in part on state estimates of their costs. States can use money from local governments and other sources to pay some costs. The GAO found that through certain financing arrangements, states can lower their contribution and shift Medicaid costs to the federal and local governments and care providers. This can increase the federal share and poses risks to the program’s sustainability. Since designating Medicaid as a high-risk area in 2003, GAO has made at least 55 recommendations related to the appropriate use of program dollars. Of these recommendations, 15 were not yet implemented as of May 2020.

Find the full report here.

GAO: Science & Tech Spotlight – Herd Immunity for COVID-19

On July 7, the Government Accountability Office (GAO) published a report on “herd immunity,” which can happen once a large part of a population, about 70-90 percent, develops immunity to a disease. This generally happens by infection (conferring natural immunity) or vaccination. Herd immunity can help slow or stop a disease’s spread, but many people may die before it happens.

According to the GAO, it is currently unclear how herd immunity could happen for COVID-19. For example, the data are insufficient to show how much immunity infection confers, or whether it is enough to prevent re-infection. How long any immunity will last is also unknown. Related viruses confer some immunity after infection, but that immunity does not seem to last longer than a year. The GAO lists challenges as including limited data on immunity, testing limitations, inconsistent immunity and a lack of vaccine for COVID-19.

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.

To sign up for the Weekly Washington Healthcare Update, use our onlinesubscription form.

McGuireWoods Consulting LLC
2001 K Street
Suite 400
Washington, DC 20006-1040
+1 202 857 1700