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Healthcare Today

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Casie Daugherty

February 21, 2020

The outbreak of coronavirus (COVID-19) continues to dominate the news. The number of new cases appears to be slowing, although there is concern whether new cases are slowing or if it is a matter of how cases are being confirmed by health officials in China. Health officials in Japan are exploring how the disease is being spread after a cruise ship docked in Yokohama was quarantined with over 600 passengers testing positively for the disease.

Congress is also digging in deeper over the outbreak; Representatives John Garamendi (D-CA) and Vicky Hartzler (R-MO) have introduced a bill (H.R. 4710) to require the Department of Defense (DoD) to only purchase American-made raw materials, medicines, and vaccines for U.S. troops. There is a growing concern about the fact that China manufactures most of the therapies Americans consume. The bipartisan duo plans to advance their bill as part of the Defense Authorization bill. There is also a hearing scheduled March 3rdin the Senate Health, Education, Labor, and Pensions (HELP) Committee featuring officials from the Centers for Disease Control (CDC), National Institutes of Health (NIH), Food and Drug Administration (FDA) about steps the federal, state and local governments are taking to prevent the spread of this disease.

Sanofi Pasteur is getting in the game to develop a vaccine for coronavirus, joining Johnson & Johnson, Inovio, and Moderna in the race to develop a preventative measure to combat the disease. Reynolds American is infecting fast growing tobacco plants with coronavirus to see if they can unlock some clues about how to develop a vaccine.

The Trump administration’s plans to impose work requirements in the Medicaid program took a step back at the end of last week. A federal appeals court in Washington upheld a lower court’s ruling in March that voided the Department of Health and Human Services (HHS) approval of the state of Arkansas plan to impose work requirements in their state’s Medicaid program. The decision is likely to be appealed to the Supreme Court although HHS did not immediately comment on the decision.

The Medicare Advantage program is proving to be more popular with senior citizens. The plan experienced a 9.4% spike in enrollees this year, making the total covered population by the program 24.4 million seniors. Seven states (California, Minnesota, Florida, Hawaii, Oregon, Pennsylvania, and Rhode Island) have over 40% of their seniors enrolled in the program. Minnesota is the leading the pace with nearly 60% of their seniors covered by Medicare Advantage. The Congressional Budget Office (CBO) attributes Medicare Advantage to the growing Medicare spending. CBO noted that Medicare spending is going to be $22 billion higher than originally projected with most of that growth coming from the Medicare Advantage program.

Senator Grassley is more optimistic about the chances of his drug pricing bill passing the Senate. In fact, the senator tweeted a classic missive about his bill on Valentine’s Day. The latest Republican senator to support the bill is his fellow Iowan Senator Joni Ernst (R-IA) becoming the 12th Republican senator to publicly back the bill. Senator Grassley believes he needs at least 25 Republican senators for Majority Leader Mitch McConnell (R-KY) to feel comfortable with the bill on the Senate floor.

As Washington continues to grapple with the cost of insulin as part of the drug pricing debate, FDA finalized its definition of “biological product” clarifying a protein as a polypeptide with a specific sequence, ultimately allowing for the transition of applications for insulin, human growth factor, fertility treatments and other products to licensed biologics starting March 23. This will in turn open up possible biosimilar and interchangeable competition for insulin.

We want to give a big thanks to all the hospital employees, nurses, doctors, and other healthcare professionals on this National Caregivers Day.

February 14, 2020

The World Health Organization has officially named the Coronavirus Disease announcing it will be called COVID-19.  The “co” stands for “corona”, “vi” for “virus” and “d” for “disease”, while “19” was for the year, as the outbreak was first identified on December 31st, 2019. Coronavirus cases in the United States have risen to 15 and an American in Wuhan, China died from the virus. At least twenty-five public health laboratories in the United States announced they’ve been unable to test for cases of the coronavirus originating in Wuhan because the test kits that have been distributed by the Centers for Disease and Control (CDC) are delivering inconclusive results. The CDC is currently working with the labs to fix the issue and labs are sending all clinical specimens to the CDC as a backup measure.

Both the House Education and Labor Committee and the House Ways and Means Committee marked up legislation this week seeking to fix the issue of surprise billing. The House Education and Labor Committee legislation passed through the committee with bipartisan support but had members of the committee oppose the legislation due to its use of a benchmark rate and the legislation’s impacts on doctors. The House Education and Labor Committee’s legislation would limit cost-sharing for patients to their insurance plan’s in-network rate and prohibit doctors outside their patients’ networks from billing them directly for more than the same in-network rate. Under this plan, doctors would need to accept a benchmark rate for bills under $750 and go through arbitration in disputes over bills higher than $750. Some of the Education and Labor Committee members favored the House Ways and Means legislation that passed through committee this week with bipartisan support.

The Ways and Means Committee legislation has the support of doctors’ groups and it would ask payers and providers to settle their disputes privately or go to third-party mediators for settlements. The leaders of the House Energy and Commerce, House Education and Labor, and House Ways and Means Committees are expected to try to work out their differences and come up with final legislation soon.

President Trump also weighed in on surprise billing this week. Trump thanked the House Ways and Means and Education and Labor Committees for their work and asked them to work with the House Energy and Commerce Committee and Senate Health Education Labor and Pension Committees to send a bipartisan bill to his desk.

Senate Finance Chairman Chuck Grassley (R-IA), Ranking Member Ron Wyden (D-OR), Sen. Todd Young (R-IN), and Sen. Ben Cardin (D-MD) have started to probe the U.S. Organ Procurement and Transplantation Network (OPTN). A number of inspector general audits and news reports have raised questions about the agencies abilities with reports indicating thousands of available organs were not used and questioning of whether patient safety standards were met. The group of senators sent a letter to the United Network for Organ Sharing (UNOS) that oversees the OPTN requesting an expansive amount of data.

A bipartisan bill led by Sen. Bill Cassidy (R-LA), Sen. Jeanne Shaheen (D-NH), and Sen. Tammy Baldwin (D-WI) was introduced this week that seeks to close the orphan drug loophole that currently gives certain profitable drugs shelter from competition. Currently, drug companies are allowed to get seven years of market exclusivity if they can prove to the Food and Drug Administration (FDA) that the new drug they developed needs exclusivity to be economically viable. The bill will allow the FDA to remove this market exclusivity if the company fails to prove that the drug would be economically unviable when facing competition encouraging more market competition and allowing cheaper options to come on the market sooner.

We wish you all a Happy Valentine’s day and hope you enjoy your time with your loved ones!

February 7, 2020

Last Friday, President Trump announced a travel ban on immigrants who pose a risk of transmitting the coronavirus. The executive order bans entry into the United States for all foreign nationals who were physically present within China during the 14-day period immediately preceding their entry to the United States unless they’re immediate relatives of U.S. citizens or permanent residents. The executive order seeks to stop the virus from spreading, but Ron Klain, who led the Obama Administration’s Ebola response efforts, told a House Foreign Affairs subcommittee that the travel ban won’t stop the spread of the virus. Jennifer Nuzzo, an associate professor and senior scholar at the Johns Hopkins Center for Health Security, agreed and said at the hearing that the virus is spreading too quickly for the travel ban to be effective. Klain believes the focus needs to be on people who have visited the Hubei province in the past 14 days. The White House declined to send administration officials to testify.

It was a busy week in surprise billing. House Ways and Means Committee Chairman Richard Neal (D-MA) and Ranking Member Kevin Brady (R-TX) released text of the Committee’s bipartisan plan to stop surprise medical bills. The Ways and Means Committee plan centers on a pseudo-mediation model to fix the issue of surprise medical bills and for the first time seeks to require patients to receive a true and honest bill in advance of scheduled procedures. The committee plans to hold a mark-up of the legislation next week. House Energy and Commerce Committee Chairman Frank Pallone (D-NJ) and Ranking Member Greg Walden (R-OR) and Senate Health, Education, Labor and Pensions Committee Chairman Lamar Alexander (R-TN) and Ranking Member Patty Murray (D-WA) released a statement today in support of the bipartisan legislation that they released last year. Their legislation would allow health plans and providers to submit billing disputes over $750 to outside arbiters and bar air ambulances from billing patients the difference between the charged and the allowed amount. The House Education and Labor Committee is also expected to release new bipartisan legislation today and hold a mark-up on that bill next week.

The House of Representatives agreed to a resolution that disapproves of a recent Trump Administration policy that seeks to allow states to set limits on Medicaid benefits and drug lists. The new program will allow states to seek Section 1115 waivers to receive defined payments for adults that are covered by the Affordable Care Act’s Medicaid expansion. The vote was mostly along party lines with one Democrat voting with Republicans. Democrats refer to this policy as block-granting the Medicaid program and argued that they oppose any plan to weaken the Affordable Care Act’s expansion of Medicaid, while Republicans support the President’s proposal and believed this resolution was partisan and political.

The Centers for Medicare and Medicaid Services (CMS) issued proposed changes to Medicare Advantage and Medicare Part D that seek to modernize and strengthen the two programs. The proposed rule would implement the 21st Century Cures Act requirement to give all beneficiaries with End Stage Renal Disease the option to enroll in a Medicare Advantage plan starting in 2021. The changes also seek to lower beneficiary cost sharing on the most expensive prescription drugs by allowing beneficiaries to compare their out-of-pocket payments for different prescription drugs under Part D plans. CMS is also proposing updates to methodologies used to pay Medicare Advantage plans and Part D sponsors that are expected to increase revenue by 0.93%.

President Trump focused much of his State of the Union speech on health care, spending close to 15 minutes on health-related issues. The President mentioned a number of priorities including a push for bipartisan legislation to reduce drug costs, praise for his administration’s introduction of association health plans, and bipartisan support for investments in fighting kidney disease, HIV, and improvements in the opioid epidemic. The President also attacked Democrats on legislation that would give free health care to illegal immigrants and promised to never let socialism destroy American healthcare, giving us a possible preview of his reelection strategy.

It is National Wear Red Day, so we hope you enjoy sporting your Santa Claus costume!

January 31, 2020

The World Health Organization declared the Coronavirus a public health emergency of international concern. The organization hopes that this will allow the agency to give more help to countries to stop the spread of the virus. The White House announced the formation of a Coronavirus Task Force that will be led by Health and Human Services Secretary Alex Azar. The Task Force will seek to monitor, contain, and mitigate the spread of the virus. Senators have stated that there could be a potential need for supplemental funding to deal with spread of the virus, and the House Energy & Commerce Committee is planning a hearing on the virus next week

This week, the Centers for Medicare and Medicaid Services introduced the Healthy Adult Opportunity program. This initiative allows states to set limits on Medicaid benefits and drug lists. The new program will allow states to seek Section 1115 waivers to receive defined payments for adults that are covered by the Affordable Care Act’s Medicaid expansion. The capping of Medicaid spending is a major change from how the program is currently financed with a shift from open-ended matching to states to a capped amount of federal dollars to states for the program. This proposed change will likely face legal challenges from opponents who view this as executive overreach.

In surprise billing news this week, House Majority Leader Steny Hoyer (D-MD) said that he hopes a surprise billing deal can be moved as early as mid-February if committee leaders are able to come up with a consensus on the final bill. House Education and Labor Committee Chairman Bobby Scott (D-VA), who chairs one of the committees with jurisdiction over the matter, said this week that he plans to mark-up new surprise billing legislation in the next two weeks. House Ways and Means Committee Chairman Richard Neal (D-MA) announced that his committee will lay out language for legislation to tackle surprise medical bills next week and plan to have a mark-up on the legislation on February 12th. The Ways and Mean plan centers on a mediation model to fix the issue and has the support of Ranking Member Kevin Brady.

Yesterday, a bill passed in the House that would extend the government’s ability to categorize new, illicit types of fentanyl as illegal until 2021. The bill would extend the Justice Department’s temporary power to place fentanyl-like substances on the list of the most-strictly controlled drugs for fifteen months. The Senate version of the bill has already passed paving the way for President Trump to sign the bill into law.

Whether you are a 49’ers fan, a Chiefs fan, or neither, we hope you enjoy the Super Bowl this weekend.

January 24, 2020

The Supreme Court this week denied a motion to fast-track a review of the Texas vs. United States Affordable Care Act court decision. A group of attorneys general filed a petition asking the Supreme Court to fast-track a review of Texas vs. United States so that it could be considered this term. The Supreme Courts decision is a loss for Democrats who hoped that the decision could be heard before the election. Democrats remain hopeful that the Supreme Court will review the case by next term which begins in October, but it is likely that the case will not be heard until after the 2020 election.

The World Health Organization declared that the Wuhan coronavirus outbreak is not yet a global health emergency. The outbreak has now spread from China to at least five other countries and at least seventeen people have passed away due to the respiratory disease. The Centers for Disease Control (CDC) has begun screening travelers at major U.S. airports and has placed staff overseas to work alongside the ministers of health in China and Thailand. The CDC has also asked the Food and Drug Administration (FDA) to authorize emergency use of a newly developed diagnostic test to detect the Wuhan coronavirus. The FDA has authorized emergency use in past outbreaks of Zika and Ebola and the authorization allows the CDC to share this test with local and state health officials. The Senate Health, Education, Labor, and Pensions and Foreign Relations Committee hosted a briefing today for all senators with top administration health officials from the CDC, the State Department, and Centers for Medicaid and Medicare Services (CMS) around the coronavirus situation.

We are hearing that the CMS is planning to issue a letter next week regarding Medicaid block-grant guidance. CMS Administrator Verma is expected to issue a letter that will explain how states can seek 1115 waivers to receive defined payments for adults that are covered by Obamacare’s Medicaid expansion. Capping Medicaid spending will likely face legal challenges from opponents who view this as executive overreach.

There is a bipartisan push in the Senate to hold e-cigarette companies accountable for the youth vaping crisis. There was bipartisan legislation introduced this week by Senators Jeanne Shaheen (D-NH), Lisa Murkowski (R-AK), Richard Durbin (D-IL), Mitt Romney (R-UT), Tammy Baldwin (D-WI) and Susan Collins (R-ME) that would require e-cigarette manufactures to pay higher user fees to the FDA to help fund the agencies oversight of the e-cigarette industry. Under this bill the tobacco industry’s yearly fees to the FDA would increase from $712 million to $812 million. Companion legislation will be introduced in the House by Representative Cheri Bustos (D-IL). In other vaping news, over fifty lawmakers led by House Energy and Commerce Oversight Subcommittee Chairwoman Diana DeGette (D-CO) sent a letter to Human Health and Services Secretary Alex Azar calling on the agency to revise its guidance and issue new rules that would ban the sale of flavored nicotine products.

The Environmental Protection Agency (EPA) weakened its request to find out more about companies use of ethylene oxide in sterilizing medical equipment after pushback from the FDA. The FDA claimed jurisdiction over the use of the cancer-causing chemical and requested deletion of the entire discussion around ethylene oxide. The EPA removed the entire section dealing with low ethylene oxide volumes from the final version of its advanced notice of proposed rulemaking but did include a more general question regarding the cost and feasibility of the practice that could result in lower emissions of the toxic chemical.

It is National Beer Can Appreciation Day and National Peanut Butter Day so enjoy your peanut butter and jelly sandwich for dinner with your cold beer (in moderation).

January 17, 2020

Thousands of healthcare leaders and executives convened in San Francisco for the annual J.P. Morgan Health Care Summit this week. Centers for Medicare Services (CMS) Administrator Seema Verma was the keynote speaker for the event and spoke to attendees in a moderated question and answer session. Verma expressed her continued support to realign financial incentives and provide innovation in states to ensure costs are under control, the administrative burdens in providing value-based care, and the need to look at technology and innovation to solve our healthcare problems.

Kate Goodrich, the Chief Medical Officer at CMS, is resigning from her role at CMS to take a position at health insurer Humana. Goodrich played a central role at CMS and has led the quality measurement and value-based incentives group since 2012. Goodrich will now be working on improving outcomes for patients at Humana. Goodrich isn’t the only Administration official headed to Humana, as Mona Siddiqui is leaving her post as the Chief Data Officer at HHS to focus on initiatives at Humana to improve patient safety and quality of care.

House Speaker Nancy Pelosi said this week that the House will address the surprise billing issue once they return from the recess break. The leaders of the House Energy and Commerce Committee and the House Ways and Means Committee are both working on legislation to fix the surprise billing issue.  The Energy and Commerce plan has the support of Senate Health, Education, Labor, and Pensions Committee Chairman Lamar Alexander (R-TN) and Energy and Commerce Ranking Member Greg Walden (R-OR), and would allow health plans and providers to submit billing disputes over $750 to outside arbiters and bar air ambulances from billing patients the difference between the charge and the allowed amount. The Ways and Means plan has the support of Chairman Richard Neal and Ranking Member Kevin Brady (R-TX) and centers on a mediation model to fix the issue.

The House Energy and Commerce Health Subcommittee held a hearing this week on the future of cannabis policy for the new decade. Currently, researchers that want to study marijuana need to get approval from the Drug Enforcement Agency and can only use marijuana grown at the University of Mississippi. There was bipartisan support from the Subcommittee that an expansion of these research opportunities was needed. Critics of the current process noted that this system doesn’t reflect the diversity of marijuana strains currently on the market.

There is a bipartisan push for the Food and Drug Administration to allow hemp-derived cannabidiol (CBD) to be lawfully marketed as a dietary supplement. House Agriculture Chairman Colin Peterson (D-MN), Rep. James Comer (R-KY), and Rep. Brett Guthrie (R-KY) introduced legislation this week that would amend the Federal Food, Drug, and Cosmetic Act to change the way the FDA regulates hemp-derived CBD. The bill calls for flexibility in allowing hemp-derived CBD to be marketed in dietary supplements and require a study and report from the U.S. Department of Agriculture.

We hope you all enjoy the long weekend and take some time to remember Dr. Martin Luther King Jr’s legacy and lasting impact on our country.

January 10, 2020

The Supreme Court ordered the Trump Administration and the states challenging the Affordable Care Act to respond by today at 4:00 pm to an appeal filed to the Supreme Court. The appeal was filed by a group of Attorneys General who asked the Supreme Court to review a December decision by a federal appeals court that ruled the Affordable Care Act’s (ACA) individual mandate penalty unconstitutional.

The House Energy and Commerce Committee’s Health Subcommittee discussed a number of healthcare measures this week. The Subcommittee hearing focused on H.R. 5534, a bill that would remove the 36-month limit on Medicare coverage for transplant recipients. Medicare covers dialysis for all people who need it, but not all people who have received a kidney transplant are eligible to stay covered for the immunosuppressant drugs on which they rely to prevent their new kidney from being rejected. Also discussed in the hearing were H.R. 3935, a bill that would require Medicaid to cover non-emergency – but medically necessary – transportation like public transit, taxis, and van services, and H.R. 2477, a bill that directs the federal government to provide advance notice to individuals approaching Medicare eligibility about basic Medicare enrollment rules, filling a long-standing gap in education for older adults and people with disabilities.

The Bipartisan Policy Center released a poll this week that indicated healthcare will remain a top issue heading into the 2020 elections. Healthcare was polled as the most important issue overall for Democrats and Independent voters and the third most important for Republican voters. Among those polled there was a preference for improving the current system over repealing the Affordable Care Act or adopting a Medicare-for-all single-payer system.

The New England Journal of Medicine released a study that found the “hotspotting” program created by the Camden Coalition of Healthcare Providers did not live up to the promise of its potential. The model hoped to reduce spending and improve health care services for the sickest and most expensive patients. The program focused on health care workers identifying those patients and invested resources to coordinate their care. The program gained national recognition and interest from Federal officials. The study concluded that hospital readmission rates were no lower among patients randomly assigned to the Coalition’s program than among those who received usual care.

The Department of Health and Human Services (HHS) and the Centers for Medicare and Medicaid Services (CMS) announced that Brad Smith will replace Adam Boehler as the Director of the Center for Medicare & Medicaid Innovation (CMMI) at CMS and Senior Advisor to HHS Secretary Azar for Value-Based Transformation. Smith previously served as CEO of Aspire Health that he founded with former U.S. Senate Majority Leader Bill Frist (R-TN) and worked for Tennessee Gov. Bill Haslam and Sen. Bob Corker (R-TN).

For those of you like the one of us that has yet to take down their Christmas tree, we want to remind all of you to take care of your indoor foliage on this National Houseplant Appreciation Day.

January 3, 2020

The Food and Drug Administration (FDA) finalized its enforcement policy on unauthorized flavored cartridge-based e-cigarettes. Manufacturers will have 30 days to take flavored vape cartridges with the exception of menthol off the market. Open tank systems that are used more by adults will still be allowed to be sold in vape shops as long as steps to prevent youth access are taken by manufacturers. The Administration believes this guidance will both prevent teen use and allow e-cigarette use for adults who want to reduce or quit the use of combustible cigarettes. The guidance has faced criticism from lawmakers and public health organizations who believe that the partial ban doesn’t go far enough and that there are still loopholes that will allow teenagers to still buy products from vape shops.

The nursing home industry believes that an expected recommendation from the Medicare Payment Advisory Commission (MedPAC) will harm providers. At its December meeting, MedPAC recommended the elimination of the base payment rate update for fiscal year 2021 in skilled nursing facilities as they believe this would lower spending and not impact access to services. Mark Parkinson, President and CEO of the American Health Care Association, said in a statement that these recommendations are not the answer and that skilled nursing facilities are currently struggling to keep their doors open.

The Centers for Medicare and Medicaid Services (CMS) announced the Affordable Care Act (ACA) enrollment numbers remained stable in 2019. 8.3 million people enrolled dropping from around 8.5 million enrollees a year ago. CMS noted that the decline is due to a number of factors including a strong economy, the expansion of Medicaid in Maine, and Nevada switching to a state-based exchange.

A federal appeals court upheld the Department of Health and Human Services (HHS) methodology to administer the ACA risk-adjustment program reversing a lower court decision on the matter. The use of statewide average premiums was previously deemed “arbitrary and capricious” by a district court in New Mexico. The Tenth Circuit ruled that the program must be budget neutral and that using the statewide average was allowed. New Mexico Health Connections who brought the challenge could appeal the case directly to the Supreme Court, but it is unclear if they would hear the case.

House Energy and Commerce Chairman Frank Pallone (D-NJ) and Ranking Member Greg Walden (R-OR) along with Senate Health Education Labor and Pension Committee Chairman Lamar Alexander (R-TN) and Ranking Member Patty Murray (D-WA) expanded its bipartisan investigation into physician staffing companies and insurers role in surprise billing legislation. The leaders of the two committees sent letters to companies including Anthem Inc., Cigna Corp., UnitedHealth Group Inc., and CVS Health Corp. as part of its probe into the practice of surprise billing. The leaders are asking for assistance from the companies understand why surprise billing occurs and the policies and practices that help protect individuals from surprise billing.

It is JRR Tolkien’s birthday so enjoy re-reading the Hobbit or Lord of the Rings this weekend in his honor!