Washington Healthcare Update

January 25, 2021

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: President Joe Biden begins his term and Congress begins work to confirm cabinet secretaries.



Proposed Rules

Final Rules/Guidance




Wyden and Pallone Send Letter to CMS, Concerned over Section 1115 Demonstrations

On Jan. 19, House Energy and Commerce Committee Chairman Frank Pallone (D-NJ) and Senate Finance Committee Ranking Member Ron Wyden (D-OR) wrote to outgoing Centers for Medicare & Medicaid Services (CMS) Administrator Seema Verma requesting that CMS rescind a batch of letters it sent to states earlier this month. The letters claim that CMS made it difficult for the incoming Biden administration to reverse harmful Medicaid changes.

CMS asked states to quickly sign onto a new agreement outlined in the letters, establishing a nine-month process for CMS to withdraw federal approval of experimental changes to Medicaid programs known as section 1115 demonstrations. Under the Trump administration, CMS has approved a number of controversial section 1115 demonstrations, including a recently unveiled block grant funding for Tennessee and several work requirement programs that have been repeatedly struck down in the courts.

Find the full letter here.


HHS Delays Trump Administration Final Rule on Health Clinics’ 340B Drug Discounts

On Jan. 21, the Department of Health and Human Services (HHS) delayed a final rule from the Trump administration for 60 days that would make health clinics pass 340B discounts on insulin and epinephrine on to patients. The final rule is delayed until March 22, 2021. The Health Resources and Services Administration (HRSA) could let the rule take effect or withdraw it.

CMS Releases an Informational Bulletin on the Extension of Grace Period Related to the Four Walls Requirement for IHS/Tribal Facilities

On Jan. 15, the Centers for Medicare and Medicaid Services (CMS) released a Center Informational Bulletin that extends the grace period previously granted to Indian Health Service (IHS) facilities, and facilities operated by Tribes and Tribal organizations under the Indian Self-Determination and Education Assistance Act (ISDEAA). This ISDEAA permits IHS and Tribal facilities to claim Medicaid reimbursement under the clinic services benefit at 42 C.F.R. § 440.90 (including at the IHS All Inclusive Rate) for services provided outside the “four walls” of the facility.

The grace period is extended to Oct. 31, 2021, and the bulletin explains the steps Tribal facilities and states will need to take before the extended grace period expires in order for these facilities to continue to be reimbursed for services provided outside the four walls of the facility after Oct. 31.

Find more information here.

CMS: Part D Senior Savings Model – CY 2022 Pharmaceutical Manufacturer RFA Released

On Jan. 15, the Centers for Medicare and Medicaid Services (CMS) released the Calendar Year (CY) 2022 Part D Senior Savings Model Request for Applications (RFA) for Pharmaceutical Manufacturers for Plan Year 2022. The Part D Senior Savings Model tests a change that enables participating Part D enhanced alternative plans to lower Medicare beneficiaries’ out-of-pocket costs for insulin to a maximum $35 copay per one-month supply in the deductible, initial coverage and coverage gap phases of the benefit. CMS intends to subsequently release the CY 2022 Request for Applications for Part D Sponsors after it completes its review and approval of CY 2022 manufacturer participation, and is currently targeting March 2021 to start these activities.

Manufacturers of Model Drugs who are not currently participating in the Part D Senior Savings Model that wish to participate in the Model for the 2022 Plan Year must submit an executed Addendum to the Medicare Coverage Gap Discount Program Agreement for Participation in the Part D Senior Savings Model to CMS by 11:59 p.m. ET on Jan. 27, 2021. 

Signed materials should be submitted to CMS via PartDSavingsModel@cms.hhs.gov.

Find more information here.

CMS: Applications for MIPS Exceptions Due to COVID-19 Now Due Feb. 1

On Dec. 17, the Centers for Medicare and Medicaid Services (CMS) pushed back the deadline to Feb. 1 for doctors to apply for extreme and uncontrollable circumstances exceptions from the Merit-based Incentive Payment System. CMS is reminding providers that that process can include a request to leave out one or more performance categories from their score due to the COVID-19 pandemic. However, the hardship application for the interoperability category would still have a Dec. 31 deadline.

Find more information here.

Proposed Rules

FDA Issues Draft Guide on Proprietary Naming of Non-Rx Drugs

On Dec. 11, the Food and Drug Administration (FDA) published a draft guidance that details how sponsors should select and screen proprietary names for nonprescription drugs. The new draft guidance, Best Practices in Developing Proprietary Names for Human Nonprescription Drug Products, makes naming recommendations for drugs that are switched from full-prescription and partial-prescription to nonprescription status. In the draft guide, FDA says drugs that switch from full-prescription to nonprescription status likely can keep the same name. However, drugs that are switched from partial-prescription to nonprescription status may need to have their names changed to avoid causing confusion among consumers.

Find the draft guidance here. Public comments are due by Feb. 8, 2021.

Final Rules/Guidance

FDA Updates Recommendations for Investigational COVID-19 Convalescent Plasma

On Jan. 15, the Food and Drug Administration (FDA) issued a new guidance to provide recommendations to health care providers and investigators on the use of COVID-19 convalescent plasma under the Emergency Use Authorization (EUA) or investigational convalescent plasma under a public health emergency. The guidance also provides recommendations to blood establishments on collection. The guidance describes FDA’s interim compliance and enforcement policy regarding the IND requirements for the use of investigational convalescent plasma to facilitate the availability of convalescent plasma to treat hospitalized patients with COVID-19. The guidance supersedes the guidance of the same title issued in November 2020 (previous versions September 2020, May 2020 and April 2020).

Find the updated guidance here.

HHS: Final Rule Sets Term Limits for Agency Policy Directors

On Jan. 15, the Department of Health and Human Services (HHS) released a final rule imposing a five-year term limit for 66 policy-level directors across HHS’s 66 sub-agencies. According to the final rule, terms will expire on staggered dates beginning in December 2021. When a term expires, the center director can be re-appointed to the same position, and if not, the employee must be appointed somewhere else within the agency.

Find the final rule here.


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

PBMs Sue Trump Administration over Drug Rebate Rule

On Jan. 12, the Pharmaceutical Care Management Association sued the Trump administration over Medicare drug rebates that pharmaceutical benefit managers (PBMs) use to negotiate lower prices for insurers. The lawsuit challenges the merits of the regulation and argues that the Trump administration circumvented public rulemaking. The rebate rule, which is set to take effect next year, would replace the safe harbor for rebates with a safe harbor for up-front discounts that are given to patients at the pharmacy.


GAO: Health Care Funding – Federal Obligations to and Funds Received by Certain Organizations Involved in Health-Related Services, 2016 through 2018

On Jan. 21, the Government Accountability Office (GAO) released a report analyzing the federal funding provided to various organizations, including Federally Qualified Health Centers, Planned Parenthood Federation of America and International Planned Parenthood Federation. The organizations included in GAO’s review provide health-related services, including services related to family planning and sexual and reproductive health. In total, these organizations received almost $16 billion through Department of Health and Human Services (HHS) or U.S. Agency for International Development (USAID) grants or cooperative agreements from 2016 through 2018. Federally Qualified Health Centers received nearly all of the funds.

Find the full report here.

GAO: Rural Hospital Closures – Affected Residents Had Reduced Access to Health Care Services

On Jan. 21, the Government Accountability Office (GAO) released a report on how over 100 rural hospitals closed from January 2013-February 2020. When rural hospitals closed, people living in areas that received health care from them had to travel farther to get the same health care service, about 20 miles farther for common services like inpatient care. People had to travel even farther, about 40 miles, for less common services like alcohol or drug abuse treatment. Before rural hospitals closed, counties where these hospitals were located had fewer doctors than counties without any closures. The number of doctors further decreased when hospitals closed.

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