HealthCare Roundtable e-News – March 13, 2023

 

Registration Now Open

Webinar – March 28, 2023 – 2:00 PM (EST) – The Cost of the Pharmaceutical Industries’ Anticompetitive Practices and its Impact on Public Sector Purchasers

To protect profits and delay competition, pharmaceutical companies often abuse patent thickets, the accumulation of an overlapping set of patents, and other anti-competitive practices which leads to higher costs for Roundtable members and the public sector purchasers they serve. A recent Matrix Global Advisors (MAG) report highlights the cost of these practices, finding that abuse of patent thickets results in certain drugs costing patients and the healthcare system an estimated $1.8 billion to $7.6 billion per year.

Join us for a discussion with the Public Sector HealthCare Roundtable senior policy team and the report’s authors on the cost of anti-competitive practices by the pharmaceutical industry and policymakers’ efforts to enact legislative and regulatory reform.

Register here.

Top News

President Biden Releases Plan to Extend Medicare Solvency Beyond 2050

On Tuesday, President Joe Biden released a plan to extend the solvency of the Medicare trust fund for 25 years by increasing taxes on those making more than $400,000 from 3.8% to 5%, closing the so-called Medicare tax loophole, and expanding Medicare drug price negotiations. Senate Democrats initially considered the proposal to close loopholes in existing Medicare taxes as a part of the reconciliation package. To make Medicare drug price negotiations more aggressive, the proposal calls for negotiating prices for more drugs sooner than originally planned. The plan also proposes extending the requirement that drug makers pay rebates when prices rise faster than inflation to commercial insurers and capping Part D cost-sharing on certain generic drugs at $2 per prescription per month. The administration says the additional prescription drug reforms would save $200 billion over 10 years, which it would transfer to the Medicare Hospital Insurance Trust Fund. The Congressional Budget Office’s current estimation for the Medicare trust fund’s insolvency date is 2033, while the latest Medicare trustees report projected 2028. The President included his plan to extend Medicare solvency in his Fiscal Year 2024 budget that he released on Thursday.

 

Study Predicts First 40 Part B And Part D Drugs for Price Negotiation

new study published this month in the Journal of Managed Care + Specialty Pharmacy identifies 38 Part D drugs and two Part B drugs that it predicts CMS will target for price negotiation between 2026 and 2028. The study, authored by West Health Policy Center and the University of California San Diego, finds that in total, the 40 products eligible for negotiation in 2026-2028 accounted for $67.4 billion in gross Medicare spending in 2020. The study predicts that the type 2 diabetes drugs Januvia (Merck) and Jardiance (Boehringer Ingelheim) may be among the first 10 Part D drugs to undergo negotiation for lower drug prices that will launch in 2026. However, both drugs are expected to have generic competition enter the market that year, and as a result, the study anticipates that the negotiated prices would only remain in effect until the end of 2027.

CMS will publish the first round of 10 Medicare Part D drugs selected for negotiation by Sept. 1, 2023. One year later, CMS is expected to announce the maximum fair prices, and those prices will take effect on Jan. 1, 2026. CMS will move on to select 15 more Part D drugs to negotiate prices for 2027, 15 more Part B or Part D drugs for 2028, and 20 more Part B or Part D drugs for each year after that.

Executive Action

On Thursday, President Biden released his Fiscal Year 2024 budget, which totals $6.8 trillion, a $400 billion increase over FY 2023. In addition, the budget would increase the Department of Health and Human Services budget by 11.5 percent after DHHS requested an additional $144 billion in discretionary spending. Specifically, the HHS budget proposes to strengthen long-term care, reduce drug prices, protect Medicare, advance cancer treatment, transform behavioral healthcare, invest in community health centers and the healthcare workforce, advance maternal health and health equity, and reduce hunger. The FY 2024 budget builds off a recent fact sheet highlighting President Biden’s intent to strengthen Medicare, lower health care costs, and notably expand Medicare’s Hospital Insurance (HI) trust fund.

Administrative Action

  • On Monday, the Health and Human Services Office of the National Coordinator for Health Information Technology (HHS ONC) released their report to Congress documenting the nation’s progress toward developing interoperable health information technology (IT) systems, barriers, and recommendations to continue expanding access. The report documents how HHS ONC and its partners can continue to modernize public health data systems, increase adoption of health IT and uniform, national network interoperability across the health care continuum. 

  • On Wednesday, the Administration for Strategic Preparedness and Response (ASPR) released a new roadmap to help health care organizations bolster their cybersecurity systems. The implementation guide includes best practices and a “common language” for addressing cybersecurity and aims to help organizations assess their preparedness. The roadmap is intended to be a guide to implementing 2018 cybersecurity standards developed by the Commerce Department’s National Institute of Standards and Technology. A February 2022 Government Accountability Office report found that HHS had not yet taken steps to determine the level of adoption of the standards in the health care sector, but had encouraged organizations to adopt it. HHS hopes to see more buy-in from small- and medium-sized organizations. 

Congressional Action

  • Recently, U.S. Senators John Thune (R-SD) and Tom Carper (D-DE) reintroduced the Chronic Disease Management Act. The Senators’ bipartisan legislation would ensure that high-deductible health plans (HDHPs) used with health savings accounts (HSAs) can cover care related to chronic disease management before a beneficiary reaches their plan deductible. The bill would also help address the impacts of chronic diseases by allowing patients enrolled in HDHPs greater flexibility in accessing the care they need. In addition, Senators Thune and Carper noted that the bill would help tackle health disparities by assisting individuals living with chronic diseases to avoid the need for higher-cost treatments down the road. The reintroduced bill builds off similar legislation from 2019 and 2021. 

  • On Tuesday, Senators Heinrich (D-NM), Brown (D-OH), Collins (R-ME), and Mullin (R-OK) introduced the Increasing Mental Health Options Act of 2023. The bill would require Medicare to cover mental health services provided by clinical psychologists in any care setting, beginning in 2025. In the 2023 Physician Fee Schedule, CMS finalized a new billing code to allow Medicare reimbursement for clinical psychologists providing behavioral health care integration and management services. However, as the Senators note in their announcement, Medicare does not currently reimburse for independent services provided clinical psychologists across all healthcare settings. 

Medicare

The Office of the Inspector General released an issue brief summarizing results from an evaluation of Medicare Advantage (MA) encounter data examining whether the lack of an indicator to identify payment denials hinders efforts to address fraud, waste and abuse. The report found that identifying whether MA payment adjustments are payment denials is challenging and imprecise. OIG recommended requiring MA plans to definitively identify payment denials to enhance program oversight.

Regulatory Action

Last Monday, the Federal Trade Commission (FTC) voted to extend the public comment period for its proposed rule that would ban employers from imposing non-competes on their workers. The FTC will now be accepting comments on the proposed rule until April 19. Announced by the FTC earlier this year, the proposed rule was developed based on a preliminary finding that non-competes constitute an unfair method of competition and therefore violate Section 5 of the Federal Trade Commission Act. The Commission vote approving the public comment period extension was 4-0, with Commissioner Christine S. Wilson issuing a concurring statement. Interested stakeholders can submit a comment here

Research

Recently, the American Health Information Management Association (AHIMA) and the National Opinion Research Center (NORC) at the University of Chicago released a report titled “Social Determinants of Health Data: Survey Results on the Collection, Integration, and Use.” In 2022, AHIMA tasked NORC with undertaking a comprehensive research survey of AHIMA members to understand better how SDOH data is collected, coded, and used and to help inform the development of educational tools and resources needed by health information (HI) professionals. This survey, and the recently released Social Determinants of Health Information Exchange Toolkit from the Office of the National Coordinator for Health Information Technology (ONC), will help to inform the development of policy recommendations to further the standardization and use of SDOH metrics. 

Mark Your Calendar for Upcoming Roundtable Events

Webinar – May 9, 2023 – 2:00 PM (EST) – Drivers of Health Care Costs: Hospital Consolidation and Lack of Price Transparency

With healthcare costs growing at an unsustainable rate, employers, taxpayers, and patients have to pay more for the same quality of care. Hospitals are one of the top drivers of rising healthcare costs due to the lack of market competition. Join us to hear from the Public Sector HealthCare Roundtable senior policy team and our group of experts on the impact of hospital consolidation, anti-competitive practices, and the lack of price transparency on patients and market-based solutions to increase hospital competition and reduce healthcare costs.

 

19th Annual Conference – November 1-3, 2023