Washington Healthcare Update

February 5, 2024

This Week in Washington: CMS releases 2025 MA and Part D proposed payment Advance Notice; CMS sends first fair drug price offers to Drug Price Negotiation Program companies; SAMHSA releases final rule making virtual prescribing of buprenorphine permanent; Biogen pulls Aduhelm from market; Supreme Court to hear mifepristone case oral arguments on March 26.

Congress

House

Senate

Administration

Proposed Rules

Final Rules

Courts

Reports

CBO Cost Estimates

Congress

House

House Budget Committee to Mark Up Preventive Health Savings Act

This week, the House Budget Committee is expected to mark up the Preventive Health Savings Act. The legislation would alter the manner in which the Congressional Budget Office (CBO) provides cost estimates for preventive healthcare policies. It would require the CBO to calculate the budgetary effects for two additional 10-year periods for healthcare policies that result in reductions to budget outlays. CBO currently limits its cost estimates to a window of 10 years.

House Energy and Commerce Committee Health Subcommittee Holds Hearing on Healthcare Costs

On Jan. 31, the House Energy and Commerce Committee Health Subcommittee held a hearing on healthcare spending and discussed how Congress could work toward lowering cost growth and improving transparency. Announced witnesses were:

  • Chapin White, Ph.D., Director of Health Analysis at the Congressional Budget Office
  • Sophia Tripoli, MPH, Senior Director of Health Policy at Families USA
  • Kevin Lyons, Plan Administration at the New Jersey State Policemen’s Benevolent Association, Inc.
  • Benedic Ippolito, Ph.D., M.S., Senior Fellow at the American Enterprise Institute
  • Katie Martin, MPA, President and CEO of the Health Care Cost Institute

For more information, click here.

House Committee on Oversight and Accountability Select Subcommittee on the Coronavirus Pandemic Holds Hearing on HHS Compliance

On Jan. 31, the House Committee on Oversight and Accountability Select Subcommittee on the Coronavirus Pandemic held a hearing to discuss the Department of Health and Human Services’ compliance with the subcommittee’s requests for documents and information concerning its response to the COVID-19 pandemic. Announced witnesses were:

  • The Honorable Melanie Egorin, Department of Health and Human Services Assistant Secretary for Legislation

For more information, click here.

Biogen Pulls Aduhelm from Market Citing CMS and FDA Decisions

On Jan. 31, Biogen announced that it would pull its Alzheimer’s drug Aduhelm (aducanumab) from the market due to limited Centers for Medicare and Medicaid Services (CMS) coverage and additional Food and Drug Administration (FDA) study requirements needed for full approval. The FDA had granted Aduhelm accelerated approval in June 2021.

Long-term critic of CMS’ coverage policy Rep. Guthrie (R-KY) stated at an Alzheimer’s event on Jan. 30 that he was disappointed with the announcement. In 2022, CMS issued a national coverage determination that blocked Aduhelm and other Alzheimer’s drugs that target amyloid beta plaque from receiving Medicare coverage except for when they are administered in clinical trials.

Senate

Senate Majority Leader Leads Democrats in Sending Amicus Brief to Supreme Court Concerning Mifepristone Access

On Jan. 30, Senate Majority Leader Chuck Schumer (D-NY) and House Minority Leader Hakeem Jeffries (D-NY) led all 263 Democratic members of Congress in sending an amicus brief to the U.S. Supreme Court. The amicus brief urges the court to reverse rulings by the U.S. Court of Appeals for the 5th Circuit and U.S. District Court for the Northern District of Texas that seek to roll back the Food and Drug Administration’s (FDA) decision to expand access to mifepristone by allowing patients to take the drug later in pregnancy and removing the in-person dispensing requirement.

The members argue that the rulings threaten the health of pregnant patients, exacerbate existing reproductive healthcare challenges and jeopardize the FDA’s drug approval process.

For more information, click here.

Senate Finance Committee Favorably Reports Nomination of HHS Assistant Secretary of Planning and Evaluation Nominee

On Jan. 31, the Senate Finance Committee held an executive session to consider the nominations of Marjorie A. Rollinson, to serve as Chief Counsel for the Internal Revenue Service, and Dr. Rebecca Haffajee, to serve as the Assistant Secretary for Planning and Evaluation at the Department of Health and Human Services.

The committee reported both nominations favorably on a 16-11 and 14-13 vote. The senators who opposed Dr. Haffajee’s nomination include Republican Sens. Crapo (ID), Grassley (IA), Cornyn (TX), Thune (SD), Scott (SC), Cassidy (LA), Lankford (OK), Daines (MT), Young (IN), Barrasso (WY), Johnson (WI), Tillis (NC) and Blackburn (TN).

For more information, click here.

Senate Finance Committee Chairman Announces Hearing on AI

On Feb. 1, Senate Finance Committee Chairman Ron Wyden (D-OR) announced that the committee will hold a hearing on Feb. 8 on the use of algorithms and artificial intelligence in healthcare. Announced witnesses are:

  • Peter Shen, Head of Digital and Automation for North America at Siemens Healthineers
  • Mark Sendak, M.D., M.P.P., Co-Lead of the Health AI Partnership
  • Michelle M. Mello, J.D., Ph.D., Professor of Health Policy and Law at Stanford University
  • Ziad Obermeyer, M.D., Associate Professor and Blue Cross of California Distinguished Professor at the University of California – Berkeley
  • Katherine Baicker, Ph.D., Provost at the University of Chicago

For more information, click here.

Administration

ONC Final Rule Concerning Health IT and Interoperability Placed on Hold

A final rule released by the Department of Health and Human Services Office of the National Coordinator for Health Information Technology (ONC) concerning health information technology and interoperability has been placed on hold after the Government Accountability Office discovered that the final rule’s effective date did not meet the 60-day effective date delay required after publication in the Federal Register.

For more information, click here.

CMS Sends Drug Companies First Fair Drug Price Offers

On Feb. 1, the Centers for Medicare and Medicaid Services announced that it had submitted its first fair drug price offers to the 10 drug companies participating in the first cycle of negotiations of the Medicare Drug Price Negotiation Program. The companies have until March 2 to agree to the proposed pricing or submit a counteroffer.

For more information, click here.

CMS Releases 2025 Part C and D Payment Policies and MA Plan Capitation Rate Advance Notice

On Jan. 31, the Centers for Medicare and Medicaid Services (CMS) released the 2025 Advance Notice of Methodological Changes for Medicare Advantage (MA) Capitation Rates and Part C and Part D Payment Policies. CMS also announced that it is seeking comments on the notice.

CMS estimates that MA plan revenues will increase by an average of 3.70 percent, reflecting a $16 billion increase in overall payments and a -0.16 percent reduction in the 2025 benchmark rate. CMS is proposing to update the Part C and D Risk Adjustment models, Part C and D Star Ratings and MA payment growth rates and methodologies, to reflect latest regulations and improve payment accuracy.

Public comments will be accepted until March 1. For more information, click here.

CMS Releases Draft CY 2025 Part D Redesign Program Instructions

On Jan. 31, the Centers for Medicare and Medicaid Services (CMS) released the calendar year 2025 Part D Redesign Program Instructions. The instructions are intended to inform stakeholders of the changes being made to the Part D drug benefit due to Inflation Reduction Act (IRA) provisions going into effect.

Part D drug benefit changes include the following:

  • The establishment of a new, three-phased benefit design reflecting annual deductible, initial coverage and catastrophic coverage;
  • The implementation of the IRA $2000 out-of-pocket cost cap;
  • The sunsetting of the Coverage Gap Discount Program;
  • The establishment of the Manufacturer Discount Program; and
  • Changes to the liability of CMS, enrollees, sponsors and manufacturers.

Public comments will be accepted until March 1. For more information, click here.

CMS Launches Value-Based Care Spotlight Website

On Jan. 30, the Centers for Medicare and Medicaid Services Innovation Center launched the Value-Based Care Spotlight website. The website intends to inform healthcare providers and the public on the impact of value-based care and the manner in which it supports them.

For more information, click here.

FDA Releases Guidance Regarding CAR T Cell Products

On Jan. 30, the Food and Drug Administration released guidance intended to assist industry and academic sponsors in developing ex vivo-manufacturer chimeric antigen receptor (CAR) T cell products and carrying out CAR T analytical comparability studies.

For more information, click here.

FDA Revises Letter of Authorization for Paxlovid EUA

On Jan. 29, the Food and Drug Administration announced that it had revised the letter of authorization for the emergency use authorization (EUA) for Paxlovid to clarify that EUA-labeled Paxlovid will no longer be authorized for emergency use after March 8, regardless of its labeled or extended expiration date.

For more information, click here.

FDA Releases Guidance Concerning Collection of Race and Ethnicity Data

On Jan. 26, the Food and Drug Administration (FDA) released guidance concerning the collection of race and ethnicity data in clinical trials and clinical studies for FDA-regulated medical products.

For more information, click here.

FDA Releases Guidance Concerning Postmarketing Safety Surveillance Best Practices

On Jan. 26, the Food and Drug Administration (FDA) released guidance concerning the best practices that FDA staff should follow when conducting postmarketing safety surveillance of human drug and biological products.

For more information, click here.

FDA Releases Draft Report and Best Practices on Guidance

On Jan. 3, the Food and Drug Administration (FDA) released a draft report and plan on best practices for guidance. The report outlines best practices for the efficient prioritization, development, review, clearance, issuance and use of FDA guidance documents.

The report also requests comments from clinicians, researchers, device manufacturers and other stakeholder groups on any revised practices, additional guidance categories, guidance formats and regulatory categories the FDA should consider.

Public comments will be accepted until March 4. For more information, click here.

SAMHSA Announces $28 Million in Grants for SUD Treatment Services

On Feb. 2, the Substance Abuse and Mental Health Services Administration (SAMHSA) announced that it will distribute $28 million through two grant opportunities to strengthen substance use disorder (SUD) treatment services. SAMHSA will award:

  • $24.4 million to the Grants to Expand Substance Use Disorder Treatment Capacity in Adult and Family Treatment Drug Courts, to expand SUD treatment and recovery services in existing drug courts; and
  • $3.6 million to the State Pilot Grant Program for Treatment for Pregnant and Postpartum Women, to support family-based services for pregnant and postpartum women diagnosed with SUD.

For more information, click here.

Proposed Rules

CDC Proposes Rule Amending HHS List of Select Agents and Toxins

On Jan. 30, the Centers for Disease Control and Prevention (CDC) released a proposed rule that amends the Department of Health and Human Services’ list of select agents and toxins that have the potential to pose a severe threat to public health and safety. The proposed rule would:

  • Remove Brucella abortus, Brucella melitensis and Brucella suis from the select agent list;
  • Add definitions and provisions to further clarify inactivation of select agents;
  • Add requirements for reporting discoveries of select agents and toxins;
  • Implement new provisions for facility verification requirements for registered biosafety level 3 and animal biosafety level 3 laboratories; and
  • Update the terminology and clarify the specific clade that is a specific agent by changing “Monkeypox virus” to “Mpox virus (clade I).”

The CDC is requesting comments on the proposed changes and seeks feedback on whether they would create additional burdens for regulated entities.

Public comments will be accepted until April 1, 2024. For more information, click here.

DOJ Civil Rights Division Proposes Rule Regarding Medical Diagnostic Equipment Access for the Disabled

On Jan. 9, the Department of Justice Civil Rights Division released a proposed rule that seeks to improve access to medical diagnostic equipment (MDE) for people with disabilities. The proposed rule would update regulations under Title II of the Americans with Disabilities Act (ADA) and would implement new technical standards that state and local governments would have to adhere to, to meet obligations under Title II of the ADA.

The proposed rule would:

  • Adopt the U.S. Access Board’s MDE standards as the technical standards for accessible MDE;
  • Require state and local government entities to ensure that programs, services and activities using MDE are accessible to individuals with disabilities;
  • Require entities to address access barriers resulting from a lack of existing accessible MDE;
  • Implement new requirements for newly acquired MDE; and
  • Ensure that staff are able to successfully operate accessible MDE and assist with transfers and positioning of individuals with disabilities.

Public comments will be accepted until Feb. 12, 2024. For more information, click here.

FDA Proposes Rule Regarding Classification of Wound Dressings and Washes

On Nov. 30, the Food and Drug Administration (FDA) released a proposed rule that would classify certain types of wound dressings and liquid wound washes containing antimicrobials and other chemicals, as solid wound dressings. The FDA currently regulates gel, cream, ointment and liquid wound dressings and washes as unclassified devices requiring premarket notification.

Under the proposed rule, the FDA would classify wound dressings and liquid wound washes with a high level of antimicrobial resistance concern as Class III medical devices. In addition, wound dressings and washes with a medium or low level of antimicrobial resistance would be classified as Class II medical devices.

Public comments will be accepted until Feb. 28, 2024. For more information, click here.

IHS Proposed Rule Removes Outdated Regulations

On Jan. 8, the Indian Health Service (IHS) released a proposed rule that aims to remove outdated regulations in the Code of Federal Regulations that do not align with current statutory text of the Hyde Amendment. The proposed rule intends to eliminate confusion regarding the legal effect of outdated regulations and seeks to align IHS guidelines with congressional guidelines governing the Department of Health and Human Services.

Public comments will be accepted until March 8, 2024. For more information, click here.

Final Rules

SAMHSA Final Rule Seeks to Expand Access to Medications for Opioid Use Disorder

On Jan. 31, the Substance Abuse and Mental Health Services Administration released a final rule that updates regulations concerning opioid treatments programs (OTPs) and seeks to expand access to medications for opioid use disorder. The final rule will:

  • Make COVID-19 flexibilities that expanded eligibility for patients to obtain take-home methadone doses permanent;
  • Allow new patients who will be treated by an OTP with methadone, to be evaluated via audio-visual telehealth platforms;
  • Allow new patients who will be treated by an OTP with buprenorphine, to be evaluated via audio-only telehealth platforms;
  • Allow nurse practitioners and physician assistants to order medications in OTPs;
  • Eliminate the requirement that patients demonstrate a full year of addiction before being eligible for treatment;
  • Expand access to interim treatment and allow patients to initiate medication treatment while awaiting further services; and
  • Promote patient-centered models of care.

In addition, the rule removes outdated language among regulations and implements new definitions reflecting current medical usage.

The final rule will go into effect on April 2, 2024. For more information, click here.

FDA Final Rule Amends Quality System Regulation Device CGMP Practice Requirements

On Jan. 31, the Food and Drug Administration (FDA) released a final rule that amends the medical device current good manufacturing practice requirements of the Quality System Regulation and aligns them with device quality management system standards set by the International Organization for Standardization. The final rule will:

  • Incorporate by reference, ISO 13485 standards for medical device quality management systems;
  • Rename the title of Code of Federal Regulations Part 820 – Quality System Regulation to Quality Management System Regulation; and
  • Establish additional requirements that clarify certain expectations and concepts used in ISO 13485.

The final rule will go into effect and the FDA will begin enforcing the new management system standard requirements on Feb. 2, 2026.

For more information, click here.

CMS Final Rule Improves Prior Authorization Process and Access to Health Information

On Jan. 17, the Centers for Medicare and Medicaid Services released a final rule that seeks to expand access to health information and improve the prior authorization process. The final rule will:

  • Require Medicare Advantage organizations, Medicaid and Children’s Health Insurance Program fee-for-service programs and managed care plan entities to send prior authorization decisions within 72 hours for expedited requests and seven calendar days for standard requests for medical items and services;
  • Require impacted payers to include a specific reason for denying a prior authorization request, publicly report prior authorization metrics and implement a Health Level 7 Fast Healthcare Interoperability Resources Prior Authorization application programming interface (API);
  • Require impacted payers to include information about prior authorizations in their current Patient Access API and implement a Provider Access API to retrieve patient claims, encounter, clinical and prior authorization data;
  • Add a new Electronic Prior Authorization measure for eligible clinicians under the Merit-based Incentive Payment System Promoting Interoperability performance category; and
  • Require hospitals and critical access hospitals in the Medicare Promoting Interoperability Program to report their use of payers’ Prior Authorization APIs to submit an electronic prior authorization request.

The final rule will go into effect on April 8, 2024. For more information, click here.

FCC Final Rule Updates Rural Health Care Program

On Jan. 10, the Federal Communications Commission (FCC) released a final rule that updates the Rural Health Care (RHC) Program and strengthens access to telehealth services in rural areas. The rule seeks to support rural healthcare providers with the costs of broadband and other eligible services and implements four updates to the RHC program, which include:

  • Permitting conditional approval of eligibility for healthcare providers to allow them to begin competitive bidding and request funding;
  • Granting program participants more flexibility by pushing back the deadline for providers to change their Service Provider Identification Number to align with the invoice deadline;
  • Eliminating the “standard urban distance” component of the urban rate rules; and
  • Allowing healthcare providers to request changes to the dates of their evergreen contracts following a funding commitment.

In addition, the FCC also released a proposed rule that seeks to remove barriers to building advanced broadband networks and expedite utility pole improvements and copper network retirements.

The final rule will go into effect on Feb. 12, 2024. For more information, click here.

OCR Final Rule Strengthens Conscience Protections

On Jan. 9, the Department of Health and Human Services Office for Civil Rights (OCR) released a final rule that seeks to strengthen the process for enforcing federal conscience laws and provide new protections against conscience and religious discrimination. The final rule will:

  • Partially rescind a May 2019 conscience final rule that was deemed unlawful by three federal district courts. The rule strengthened the rights of healthcare workers to refuse to provide services such as abortions and gender-affirming care based on moral and religious beliefs;
  • Restore OCR’s role in overseeing the enforcement process for federal healthcare conscience protection statutes;
  • Strengthen protections against discrimination on the basis of conscience;
  • Encourage entities to post a notice of rights to inform providers and patients of their rights under federal healthcare conscience protection statutes; and
  • Implement a severability provision to preserve portions of the rule if part of the rule is deemed unlawful.

In addition, the final rule states that OCR investigations will be prompt and clarifies that certain conscience statutes apply to more than just providers.

The final rule will go into effect on March 11, 2024. For more information, click here.

FDA Final Rule Implements Direct-To-Consumer Prescription Drug Ad Standards

On Nov. 21, the Food and Drug Administration (FDA) released a final rule that implements new standards for direct-to-consumer (DTC) television and radio prescription drug advertisements. The final rule will require advertisers to:

  • Present information using language that is clear and readily understandable by consumers;
  • Place textual information against a contrasting background for a sufficient duration, using a font style and size that is easily legible;
  • Announce prescription drug information in the same volume, articulation and pacing used in the rest of the ad;
  • Certify that no distracting representations including statements, text, images or sounds are used during the ad’s major statement; and
  • Simultaneously present visual and audible information for ads in television format.

The final rule complements a final guidance the FDA issued in June that outlined how advertisers should present quantitative efficacy and risk information in DTC promotional labeling and ads.

The final rule will go into effect on May 20, 2024. The compliance date of the rule is Nov. 20, 2024.

For more information, click here.

FDA Issues Final Rule Regarding Mammography Quality Standards

On March 9, the Food and Drug Administration (FDA) issued a final rule that updates the regulations implemented by the Mammography Quality Standards Act of 1992. The FDA has decided to update the regulations due to advancements made in mammography technology and information. The final rule will:

  • Improve the delivery of mammography services;
  • Strengthen communication of healthcare information;
  • Require mammography facilities to provide patients with additional health information;
  • Ensure the availability of qualified mammography personnel;
  • Bolster medical outcome audits;
  • Modernize technological aspects of mammography services; and
  • Implement enforcement tools to deal with noncompliant facilities.

The rule will go into effect on Sept. 10, 2024. For more information, click here.

Courts

Supreme Court to Hear Mifepristone Case Oral Arguments on March 26

On Jan. 29, the U.S. Supreme Court announced that it will hear oral arguments on March 26 for a case concerning mifepristone access. The court will consider whether the Food and Drug Administration’s decision to expand access to mifepristone by allowing patients to take the drug later in pregnancy and to obtain prescription of the drug through telehealth appointments should be rolled back.

Reports

GAO Releases Report Concerning Veterans Health Administration Vet Centers

On Jan. 31, the Government Accountability Office (GAO) released a report concerning the progress the Veterans Health Administration (VHA) has made in implementing recommendations the GAO made in May 2022 concerning Vet Centers.

The GAO determined that as of Jan. 2024, the VHA had implemented the GAO’s recommendation of assessing the extent to which Vet Centers were meeting the needs of their clients but discovered that it had not yet implemented the remaining four recommendations.

For more information, click here.

CBO Cost Estimates

CBO Releases Report on Testimony Concerning Federal Subsidies for Health Insurance

On Jan. 31, the Congressional Budget Office (CBO) released a report of the testimony given by CBO Director of Health Analysis Chapin White before the House Energy and Commerce Committee Subcommittee on Health during its Jan. 31 hearing on healthcare costs, concerning federal subsidies for health insurance and policies to reduce prices paid by commercial insurers.

For more information, click here.

Authors

Stephanie Kennan
Senior Vice President
Federal Public Affairs
Washington, DC
Gina Sherick
Policy Consultant
Federal Public Affairs
Washington, DC
Gabriel Wiedenhoever
Research Associate
Federal Public Affairs
Washington, DC