Washington Healthcare Update

October 26, 2020

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This week in Washington: Mnuchin and Pelosi continue discussions for COVID-19 stimulus package.

Congress 

House

Senate

Administration

Proposed Regulations/Guidance

Courts

Reports

House

Bipartisan Members Defend Preexisting Condition Protections, Disagree on Definition

On Oct. 20, the House Ways & Means oversight subcommittee had a bipartisan group of members pledge support for protecting people with preexisting conditions. The members disagreed on what defines preexisting condition protections. Republican members of the committee said preexisting conditions protections only work if coverage is affordable and said non-Affordable Care Act (ACA)-compliant products like short-term plans, which do not have to cover preexisting conditions or other essential health benefits, are a sufficient alternative.

Find more information here.

Senate

Alexander Defends NIH Dr. Fauci after President Trump’s Negative Comments

On Oct. 19, the Senate Health, Education, Labor and Pensions (HELP) Committee Chairman Lamar Alexander (R-TX) defended the director of the National Institute of Allergy and Infectious Diseases (NIAID), Dr. Anthony Fauci, after President Trump called Fauci a “disaster,” in response to the COVID-19 pandemic. Alexander called Dr. Fauci one of the country’s most distinguished public servants.

Administration

FDA: Gilead’s Remdesivir Becomes First FDA-Approved COVID-19 Treatment

On Oct. 22, the Food and Drug Administration (FDA) approved Gilead Science’s remdesivir therapeutic, Veklury®, for the treatment of hospitalized COVID-19 patients 12 years and older. This is the first FDA-approved treatment for the novel coronavirus in the U.S. FDA had previously granted emergency use authorization (EUA) for the same drug. FDA also granted a new emergency use authorization for use of the drug in hospitalized pediatric patients under the age of 12. The approval is based on three randomized controlled trials.

Find more information here.

FDA Advisory Panel to Vote on Alzheimer’s Drug

On Oct. 21, the Food and Drug Administration’s (FDA) announced an advisory committee will vote Nov. 6 on whether to recommend that FDA approve the first drug to treat Alzheimer’s. “Aducanumab,” made by Biogen, is the first Alzheimer’s disease-modifying treatment to come before FDA. Biogen CEO Michel Vounatsos said that the company would base the price on its value to many sectors of the healthcare system and over a long time. FDA does not have to follow the advice of its advisory committee, but that committee’s recommendation is one of the best indicators of the drug’s possible approval.

FDA: COVID-19 Vaccine Meeting Overview

On Oct. 22, the Food and Drug Administration’s (FDA) Vaccines and Related Biological Products Advisory Committee met for the first time to discuss the COVID-19 vaccine. The panel consists of infectious disease experts, doctors and federal scientists. FDA requested that the group consider whether COVID-19 vaccine sponsors should keep their phase 3 trials blinded even after an emergency use authorization is granted. The meeting included discussion on how experts are still concerned about the lack of diversity in the clinical trials, and how anti-vaccine sentiment and a lack of public confidence could be a barrier to a vaccine rollout.

Watch the entire meeting here.

HHS Expands Phase 3 Provider Funds to Include Additional Providers

On Oct. 22, the U.S. Department of Health and Human Services (HHS), through the Health Resources and Services Administration (HRSA), announced the latest Provider Relief Fund (PRF) application period has been expanded to include provider applicants such as residential treatment facilities, chiropractors, and eye and vision providers that have not yet received Provider Relief Fund distributions. Newly eligible practices for Phase 3 funds include

  • Behavioral Health Providers
  • Allopathic & Osteopathic Physicians
  • Dental Providers
  • Assisted Living Facilities
  • Chiropractors
  • Nursing Service and Related Providers
  • Hospice Providers
  • Respiratory, Developmental, Rehabilitative and Restorative Service Providers
  • Emergency Medical Service Providers
  • Hospital Units
  • Residential Treatment Facilities
  • Laboratories
  • Ambulatory Health Care Facilities
  • Eye and Vision Services Providers
  • Physician Assistants & Advanced Practice Nursing Providers
  • Nursing & Custodial Care Facilities
  • Podiatric Medicine & Surgery Service Providers

These providers and all Phase 3 applicants will have until 11:59 p.m. EST on Nov. 6, 2020, to submit their applications for payment consideration. Once validated, these providers will receive a baseline payment of approximately 2 percent of annual revenue from patient care plus an add-on payment that considers changes in operating revenues and expenses from patient care, including expenses incurred related to coronavirus. All payment recipients will be required to attest to receiving the Phase 3 General Distribution payment and accept the associated terms and conditions.

Reporting Requirements Update

HHS is committed to distributing PRF funds in a way that is fast, fair, simple and transparent. In September, HHS published final reporting guidance to set expectations for PRF payment recipients. In providing this guidance, HHS also updated its Frequently Asked Questions (FAQs) to clarify that for purposes of relief payments for lost revenues attributable to COVID-19, recipients must submit information showing a negative change in year-over-year net patient care operating income. This definition sought to balance fairness and establish guardrails to restrict some providers from receiving distributions that would make them more profitable than they were before the pandemic.

For updates and to learn more about the Provider Relief Program, visit: hhs.gov/providerrelief.

HHS Secretary Azar Contradicts CDC on States’ Readiness to Distribute COVID-19 Vaccine

On Oct. 19, the Department of Health and Human Services (HHS) Secretary Alex Azar announced that states already have all the resources they need to distribute a COVID-19 vaccine when the time comes. This statement contradicts the Centers for Disease Control and Prevention (CDC) director and state governors, who are asking the Trump administration for more details on what role states will play in distributing a vaccine and what funding will be available to them. CDC Director Robert Redfield already announced that the CDC does not have the money to support vaccine distribution to 64 jurisdictions, and asked for an extra $6 billion from Congress to do so.

CMS: MCD Overview Page and Advanced Search Function Will Be Removed

On Oct. 22, the Centers for Medicare and Medicaid Services (CMS) announced that the Overview page of the Medicare Coverage Database (MCD) application would be removed in an effort to streamline the site. The removal of the page will happen on Dec. 11, 2020. The website address will remain cms.gov/medicare-coverage-database but users will be directed to the Search page by default, instead of the Overview page.

On April 30, 2021, the Advanced Search function of the MCD application will be removed. All features related to the Advanced Search were incorporated into the new Search function, which was released on Sept. 3, 2020.

CMS: Radiation Oncology Model Delay

On Oct. 21, the Centers for Medicare and Medicaid Services (CMS) received feedback from a number of stakeholders about the challenges of preparing to implement the Radiation Oncology (RO) Model by Jan. 1, 2021. Based on this feedback, CMS intends to delay the RO Model start date to July 1, 2021. CMS will pursue rulemaking to make this change.

CMS: Premiums for HealthCare.gov Plans Are Lower for Third Consecutive Year

On Oct. 19, the Centers for Medicare and Medicaid Services (CMS) released a report on premiums and issuer participation for HealthCare.gov. The average premium for the second-lowest-cost silver plan (also called the benchmark plan) dropped by 2 percent for the 2021 coverage year and, for states that are using HealthCare.gov in both 2020 and 2021, 22 more issuers will offer coverage in 2021. There has been an 8 percent premium reduction across HealthCare.gov since the 2018 coverage year. CMS infers that four states will see double-digit decreases in the average benchmark plan premiums for 27-year-olds, including Iowa, Maine, New Hampshire and Wyoming. For two of these states—Maine and New Hampshire—CMS has used its authority to approve State Innovation Waivers under Section 1332 of the Patient Protection and Affordable Care Act to establish state-based reinsurance programs.

Find more information here.

Proposed Regulations/Guidance

HHS Proposes Rule to Implement President Trump’s Insulin Executive Order

On Sept. 28, the Department of Health and Human Services (HHS), through the Health Resources and Services Administration (HRSA), released a notice of proposed rulemaking to ensure community health centers receive grants for the purchase of insulin and injectable epinephrine through the 340B Drug Pricing Program. These discounted drugs will be available to community health center patients with low incomes who also have health insurance with a high cost-sharing requirement for either insulin or injectable epinephrine, health insurance with a high unmet deductible or no health insurance.

Find the proposed rule here. Public comments are due by Oct. 28, 2020.

Courts

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

Purdue Pharma to Plead Guilty in $8 Billion Opioid Settlement

On Oct. 21, the drug manufacturer Purdue Pharma announced it would plead guilty to federal criminal charges as part of a settlement of more than $8 billion. The company manufactures the prescription painkiller OxyContin that experts say helped begin the opioid epidemic. The company will plead guilty to three counts, including conspiracy to defraud the U.S. and violating federal anti-kickback laws, and the agreement will be detailed in a bankruptcy court filing in federal court. The deal does not release any of the company’s executives or owners from criminal liability, and a criminal investigation is ongoing.

Community Health Centers Sue HHS Over Missing 340B Dispute Regulation

On Oct. 21, the National Association of Community Health Centers sued the Department of Health and Human Services (HHS) in the District Court for the District of Columbia for not putting forward regulations for a dispute resolution process. As such, the community health centers argue HHS deprived providers of their only way to highlight drug manufacturers’ making them pay full price for drugs through 340B contract pharmacies. The community health centers argued that allowing for 340B pricing through contract pharmacies should count as manufacturers’ knowingly and intentionally overcharging the program participants, but the health centers cannot do anything about that because HHS has not used its regulatory authority to put an administrative dispute resolution process in place, as required by the Affordable Care Act (ACA).

Reports

GAO: Anesthesia Services – Differences between Private and Medicare Payments Likely Due to Providers’ Strong Negotiating Position

On Oct. 26, the Government Accountability Office (GAO) released a report on how in 2018, Medicare paid over $2 billion for anesthesia services such as those needed for surgery. In 2007, GAO reported that private insurance was paying about 3 times more for certain anesthesia services than Medicare was. Recent studies indicate that has increased to about 3.5 times more than what Medicare pays. According to GAO’s findings, anesthesia providers can negotiate higher payments from private insurance for a number of reasons.. For example, when smaller physician practices are consolidated into larger groups, fewer options in the market leads to reduced competition.

Find the full report here.

GAO: VA Health Care – Better Data Needed to Assess the Health Outcomes of Lesbian, Gay, Bisexual and Transgender Veterans

On Oct. 19, the Government Accountability Office (GAO) released a report on Veterans Affairs researchers that found that LGBT veterans might experience higher rates of depression and more frequent thoughts of suicide. Yet the VA cannot systematically analyze the health of these veterans because it does not consistently collect data on sexual orientation or self-identified gender identity. According to the VA, 89 percent of veterans’ records lack gender identity data. Without this data, the VA may miss opportunities to provide appropriate health screenings and identify disparities. GAO recommended the VA improve its data collection and analysis to improve health equity and better understand the needs of LGBT veterans.

Find GAO’s recommendations here, and the full report here.

GAO: Fair Labor Standards Act – Observations on the Effects of the Home Care Rule

On Oct. 19, the Government Accountability Office (GAO) released a report on how the jobs in home care are expected to grow by 40 percent in the next decade to meet demand from older adults and people with disabilities. According to the report, many home care workers did not have federal minimum wage and overtime protections until 2015. The Department of Labor extended these protections through a regulation known as the Home Care Rule. GAO compared home care workers’ hours and earnings to workers in similar jobs before and after the regulation took effect. Home care workers were more likely to work full-time after the rule, but their pay did not increase relative to similar workers.

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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