CMS Begins Stakeholder Meetings on Medicare Part D Drug Pricing Negotiations
On Tuesday, Dec. 13, the Centers for Medicare and Medicaid Services (CMS) is inviting (subscription required) drug manufacturers to the first of a series of meetings on Medicare Part D drug price negotiations. The Inflation Reduction Act of 2022 directs the Secretary of the Department of Health and Human Services (HHS) to negotiate Medicare Part D drug prices, among other drug-pricing reforms, but does not layout a framework for the negotiations. The directive gives CMS leeway to use guidance to implement the negotiations process until 2028, leaving some stakeholders worried the agency would skip the usual notice-and-comment process to garner stakeholder input. However, CMS’ decision to host monthly calls preserves stakeholder opportunities to collaborate with the agency.
The first round of negotiated prices will take effect in 2026, but HHS must publish a list of the first 10 selected drugs in September 2023. The negotiation period will begin in October 2023, and drug manufacturers must sign a negotiation agreement. Drugmakers that fail to sign agreements may be subject to a tax of up to 95% or may not be able to offer products through Medicare. CMS anticipates it will have a final list of negotiated prices for its first 10 drugs by Sept. 1, 2024. Bloomberg Intelligence predicts Jardiance, Xarelto, Symbicort, Eliquis, Breo Ellipta, Myrbetriq, Januvia, Xtandi and Victoza will be on the short list for negotiations.
House Lawmakers Attempt to Add User Fee Riders in Year-End Package
House lawmakers are poised (subscription required) to include bipartisan provisions from their Food and Drug Administration (FDA) user fee package in the year-end government funding package. Many reforms the FDA, industry, and lawmakers had negotiated for years were stripped from earlier versions of the user fee legislation after Sen. Richard Burr (R-NC) pushed for a cleaner agreement. The user fee package passed the House in June, which aimed to increase generic drug competition, among other provisions. The package included several bills from Rep. Brett Guthrie (R-KY-02), the Ranking Member of the Energy and Commerce Health Subcommittee and presumable Chairman of the Subcommittee in the 118th Congress.
- CMS released a proposed rule (fact sheet) on new requirements related to interoperability and prior authorization (PA) processes for the following payers: Medicare Advantage (MA) plans, state Medicaid and CHIP FFS, Medicaid managed care plans, and Qualified Health Plan (QHP) issuers on the Federally Facilitated Exchange (FFE). The rule withdraws and replaces a previous proposed rule published in December 2020, and addresses comments received on that rule. Comments on the rule are due March 13, 2023. CMS also proposed a number of policies to streamline and increase transparency of the PA process. CMS included 5 Requests for Information in the proposed rule.
- Last week, the Centers for Disease Control and Prevention (CDC) finalized the procurement of $3.2 billion in funding from the American Rescue Plan to help strengthen the workforce and infrastructure of state, local, and territorial jurisdiction health departments. CDC Director, Rochelle Walensky, M.D., M.P.H. released a statement emphasizing the importance of this first-of-its-kind funding to provide public health agencies the means to rebuild and reinforce the nation’s public health departments to better protect communities locally and nationally. A portion of the funds—$140 million—is reserved for targeted improvements to infrastructure—including food and water safety, child and maternal health care provision, and data monitoring.
- HHS issued a FAQ last Friday announcing that it will extend its enforcement discretion of the No Surprises Act requirement for providers to get cost estimates from any providers or facilities involved to develop a good faith estimate (GFE) for patients paying their own bills. This extension comes to providers’ and hospitals’ relief, as they argue that data-sharing standards around cost of medical services still need further development.
- To support consumer and patient safety, the Department of Health and Human Services, the Federal Trade Commission, and the Food and Drug Administration released an updated Mobile Health App Interactive Tool to help health app developers identify which federal rules apply to their technologies. This tool ensures that health tool developers better comply with privacy, cybersecurity, data sharing, and other regulatory requirements given the sensitive nature of personal health data and healthcare’s growing digital presence. The tool is provided for informational purposes only and is not intended to give legal advice. Rather, it describes potential compliance obligations and directs health app developers to educational materials and best practices.
- On Thursday, the National EMS Information System (NEMSIS) launched a national Opioid Overdose Tracker dashboard to track nonfatal opioid overdoses – strong predictors of fatal overdose – in near real-time to monitor the state of the opioid crisis. The dashboard draws from the National EMS Information System with only a two-week lag. With the implementation of this new dashboard, first responders and policymakers have more accurate data to better target naloxone distribution (which can reverse overdoses), improve response times, and improve addiction and substance use disorder support. However, the dashboard still lacks valuable demographic and geographic information that will ideally be incorporated in the next year.
The Select Committee on Economic Disparity and Fairness in Growth released its final report, Bridging the Divide: Building an Economy that Works for All, which outlines an array of bipartisan policy recommendations to provide economic support and address drastic divides between high- and low-income groups. In the US, families with low incomes are more likely to be uninsured or have less comprehensive insurance coverage and research suggests that the connection between low household income and lack of insurance means that these individuals are also less likely to receive preventive care, provider-recommended healthcare treatment, and are more heavily impacted by medical bills and out-of-pocket costs.
- Last week, the Urban Institute released a research report on what may happen to health coverage after the public health emergency (PHE) expires and states resume normal Medicaid eligibility determinations. Using administrative data on Medicaid enrollment, recent household survey data on health coverage, and the Urban Institute’s Health Insurance Policy Simulation Model, the report estimates that if the PHE expires in April 2023, 18.0 million people will lose Medicaid coverage in the following 14 months.
- The 340B program, which permits safety-net hospitals, health centers, and clinics to purchase prescription drugs at heavily discounted prices from drug manufacturers, has ensured that low-income, underserved, and rural patients can receive care. Former Representative Henry A. Waxman explains (subscription required) in Health Affairs that 340B hospitals continue to provide valuable care to those with Medicaid, communities of color, and people with disabilities who tend to have higher healthcare costs than other groups. Looking back at the past thirty years of the 340B program’s existence, he discusses how the different policy levers that make 340B possible preserve the nation’s safety-net and shares insights regarding 340B’s successes.
- At least 19 states are actively implementing strategies to address direct care worker wages through reporting and/or enforcement mechanisms, according to a recent National Governors Association (NGA) publication. Direct care workers – home health aides, nursing assistants, and other non-licensed health workers – have long experienced low wages despite their work intensity and recent COVID-19 risks. The report examines state approaches to increase direct care worker wages, with a focus on those that have reporting requirements, enforcement vehicles or other mechanisms to help ensure funds go to intended recipients working in facility and HCBS settings.
- Over a hundred health care groups, including the American Medical Association, the Surgical Care Coalition, and the American College of Physicians, rallied against the 4.5 percent reduction in the Medicare physician fee schedule (MPFS) and another 4 percent pay-as-you-go (PAYGO) cut in a letter to Congressional leadership. Physicians and provider groups argue that these compensation cuts damage physician groups’ financial viability and patient care access, and they request that these cuts be postponed or removed from Congress’ year-end spending deal.
- Few firms offer retiree health benefits, but half of those that do provide them through Medicare Advantage (MA) plans, according to 2022 Kaiser Family Foundation Employer Health Benefits Survey data, up 26% from 2017. The 24th annual survey of employers provided a detailed look at trends in employer-sponsored health coverage and included 2,188 interviews with non-federal public and private firms. The analysis further found that among larger employers with 1,000 or more workers that offer retiree health benefits through a Medicare Advantage plan, the most common reason the employer elected this option was lower cost.
Late last week, the Texas Medical Association (TMA) filed its third lawsuit against the implementation of the No Surprises Act, which bars providers from balance billing patients who seek emergency care out-of-network or who receive care from an out-of-network provider working at an in-network facility and establishes an independent resolution process to resolve payment disputes between providers and payers. The TMA’s most recent challenge argues that the Biden administration’s methodology for calculating the qualifying payment amount (QPA) conflicts with statute and enables insurers to artificially decrease the QPA, harming provider reimbursement.