This Week in Washington: CBO releases analysis of health insurance rates; Senate Finance Committee Chairman releases draft legislation concerning labor and delivery unit closures; House Oversight and Accountability Committee Democrats urge HHS to declare public emergency related to STIs.

CONGRESS

HOUSE OF REPRESENTATIVES

• Members Urge HHS to Declare Public Emergency Related to STIs

SENATE

• Senate Finance Committee Chairman Releases Draft Legislation Addressing Rural Delivery Unit Closures

OTHER

• CBO Releases Health Insurance Coverage Report and Updated Baseline Projections
• CBO Updates Cost Estimate of S. 150, Affordable Prescriptions for Patients Act of 2023

ADMINISTRATION

• HHS Creates IDR Exception Period for Parties Impacted by Cyberattack Incident
• CMS to Stop Cyberattack Accelerated and Advance Payments
• CMS Releases NOFO Application for Innovation in Behavioral Health Model
• FDA Authorizes Marketing of Menthol-Flavored E-Cigarette Products
• FDA Releases Draft Guidance Concerning Product Interchangeability Studies
• FDA Releases Guidance Concerning Facility Readiness Goal Date Decisions
• FDA Requests Information on Non-Device Software Functions’ Impact on Patient Safety

PROPOSED RULES

• CMS Proposed Rule Would Establish Increasing Organ Transplant Access Model

FINAL RULES

• FDA Final Rule Revises Medical Gas CGMP, Postmarketing Safety Reporting and Labeling
• CMS Final Rule Implements Changes Related to Standards for Electronic Prescribing and Health IT
• FDA Final Rule Allows Owner of Refused Device to Provide Testimony
• CMS Final Rule Expands Access to Healthcare for DACA Recipients
• HHS OCR Final Rule Strengthens Protections Against Disability Discrimination
• DOL EBSA Final Rule Rescinds 2018 Association Health Plan Rule
• FDA Releases Final Rule Concerning Laboratory Developed Tests
• FTC Final Rule Revises Health Breach Notification Rule
• CMS Releases Final Rule Concerning Nondiscrimination in Health Programs
• CMS Releases Final Rule Concerning Medicaid and CHIP Access to Care
• CMS Releases Final Rule Concerning Access to Medicaid Services
• HHS OCR Releases Rule Concerning HIPAA Reproductive Care Privacy
• FDA Issues Final Rule Regarding Mammography Quality Standards

REPORTS

• CBO Releases Report Concerning 340B Drug Pricing Program Spending
• FDA Releases Enhancing Clinical Study Diversity Workshop Report

COURTS

• Fifth Circuit Court of Appeals Issues Ruling in Case Concerning ACA Preventive Services Provision
• Federal District Court Judge Rules Against HHS in Hospital Website Tracking Case

---

House of Representatives

The House of Representatives is in session.

Senate

The Senate is in state work period.

House of Representatives

Members Urge HHS to Declare Public Emergency Related to STIs

On June 9, the House Oversight and Accountability Committee Democrats sent a letter to Department of Health and Human Services (HHS) Secretary Xavier Becerra, asking HHS to declare a public health emergency under Section 319 of the Public Health Service Act, because of increasing rates in syphilis cases. HHS could use emergency use authorizations to gain access to more funds, potentially use military medical personnel and have more flexibility with business transactions if HHS declared a public health emergency. The Food and Drug Administration (FDA) could also expedite the availability of certain medications under an Emergency Use Authorization when no other alternative treatment exists.

HHS has already emphasized the actions it has taken in response to the increase in syphilis cases. The FDA is allowing temporary imports of Extencilline to address the Bicillin L-A shortage (the only antibiotic available to treat syphilis) and the CDC has recommended the use of doxycycline PEP to prevent bacterial sexually transmitted disease infections, including syphilis. On June 12, HHS released considerations for providers for point of care testing for syphilis, outlining the differences in testing.

For more information on the letter, click here.

For more information on the HHS considerations for providers, click here.

Senate

Senate Finance Committee Chairman Releases Draft Legislation Addressing Rural Delivery Unit Closures

On June 17, Senate Finance Committee Chairman Ron Wyden (D-OR) and Democrat Sens. Stabenow (MI), Cantwell (WA), Menendez (NJ), Carper (CT), Cardin (MD), Brown (OH), Bennet (CO), Casey (PA), Warner (VA), Whitehouse (RI), Hassan (NH), Cortez Masto (NV), Warren (MA), Duckworth (IL) and Booker (NJ) released draft legislation to address closures of labor and delivery units in rural and underserved community hospitals.

The Keep Obstetrics Local Act would:

• Increase Medicaid payment rates for labor and delivery services with enhanced federal financing for eligible rural and high-need urban hospitals;
• Provide “standby” payments to cover the costs of staffing and maintaining an obstetrics unit at low-volume hospitals;
• Create low-volume payment adjustment for labor and delivery services at hospitals with low birth volumes; and
• Require all states to provide postpartum coverage for women in Medicaid for 12 months.

For more information, click here.

Other

CBO Releases Health Insurance Coverage Report and Updated Baseline Projections

On June 18, the Congressional Budget Office (CBO) released a report concerning projected growth of health insurance coverage in the U.S. The CBO projects that the uninsured rate will rise to 8.9 percent and the number of people on Medicare will grow to 74 million by 2034. The CBO estimates that the rise in uninsured rate will be driven by:

• The end of COVID-19 Medicaid continuous eligibility provisions;
• Expiration of enhanced marketplace subsidies; and
• Surges in immigration.

In addition, the CBO and the Joint Committee on Taxation released updated baseline projections of federal subsidies for health insurance coverage.

For more information on the report, click here.

For more information on the baseline projections, click here.

CBO Updates Cost Estimate of S. 150, Affordable Prescriptions for Patients Act of 2023

On June 13, the Congressional Budget Office (CBO) released an updated cost estimate for S. 150, Affordable Prescriptions for Patients Act of 2023. The legislation would:

• Prohibit “product hopping” by manufacturers of original drugs and biological products;
• Limit the number of patents of a certain type a company may assert that another company has infringed on or would infringe on by manufacturing, importing or marketing a biosimilar version of the first company’s original biological product; and
• Impose private-sector mandates and limit assertions of patent infringement.

The CBO projects that the bill will decrease the deficit by $3.019 billion over the 2024-2034 period. This is approximately $2 billion more than the CBO originally estimated in a 2022 cost estimate.

Earlier this year, the CBO revised the projected savings for S. 142, the Preserve Access to Affordable Generics and Biosimilars Act from $685 million to $1.65 billion and S. 148, Stop STALLING Act from $117 million to $401 million. The bills would limit pay-for-delay deals that hinder the introduction of generic medications and penalize drug manufacturers who file improper citizen petitions that interfere with the approval of competing generics and biosimilars.

The increase in projected savings could encourage Congress to include the legislation in a year-end healthcare spending package.

For more information, click here.

Administration

HHS Creates IDR Exception Period for Parties Impacted by Cyberattack Incident

On June 14, the Departments of Health and Human Services, Labor and Treasury announced that providers, insurers, air ambulances and other parties who were unable to timely initiate the first step of the arbitration process established by the No Surprises Act due to the large cyberattack incident, can begin open negotiation for any impacted items through Oct. 12.

The problem the administration seeks to address is that parties need basic information to make sure claims are eligible for the federal independent dispute resolution process before they can take the first step to initiate open negotiations.

However, much of that information was unavailable due to the attack. Providers were also dealing with payments and denial notices that they were unable to tie to claims because the systems were locked down. Because parties only have 30 days after receiving a payment to move to open negotiation, providers were growing concerned the clock might run out before they are able to get all their information on disputable claims.

In the announcement, the departments also explain that they have heard from providers and other parties unable to initiate open negotiations due to the claim processing disruptions from the cyber incident. The departments have also heard about problems matching payments and denials to claims.

Providers unable to initiate on a timely basis the open negotiations for any item or service furnished after Jan.1 due to the cyberattack can do so at any point from June 14 through Oct. 12, regardless of when they received a payment or notice of denial.

To invoke the exception period, providers must send an attestation to the non-initiating plans during open negotiation and to the IDR entities during the selection process. Non-initiating parties who believe the dispute is not eligible for the exception period should submit supporting documentation, and IDRE are responsible for adjudicating disagreements as part of their eligibility determinations.

For more information, click here.

CMS to Stop Cyberattack Accelerated and Advance Payments

On June 17, the Centers for Medicare and Medicaid Services announced that it will stop making accelerated and advance payments under the Accelerated and Advance Payment Program on July 12. The payments were distributed to Medicare providers and suppliers who experienced cash flow disruptions due to a cyberattack earlier this year.

CMS Releases NOFO Application for Innovation in Behavioral Health Model

On June 17, the Centers for Medicare and Medicaid Services released the Notice of Funding Opportunity for the Innovation in Behavioral Health Model. The model aims to improve behavioral and physical health outcomes for Medicare and Medicaid beneficiaries with moderate to severe behavioral health conditions. Applications are due by Sept. 9.

For more information, click here.

FDA Authorizes Marketing of Menthol-Flavored E-Cigarette Products

On June 21, the Food and Drug Administration (FDA) authorized the marketing of four menthol-flavored e-cigarette products through the premarket tobacco product application pathway. This is the first time the FDA has authorized non-tobacco flavored e-cigarette products.

For more information, click here.

FDA Releases Draft Guidance Concerning Product Interchangeability Studies

On June 20, the Food and Drug Administration (FDA) released draft guidance concerning reference product interchangeability studies. The draft guidance would eliminate switching studies as a requirement for biosimilar drug sponsors seeking interchangeable status. The FDA requests comments on the draft guidance. Comments are due by Aug. 20.

For more information, click here.

FDA Releases Guidance Concerning Facility Readiness Goal Date Decisions

On June 20, the Food and Drug Administration (FDA) released guidance that provides information on how the FDA will assign a goal date based on a facility’s readiness for inspection as certified on Form FDA 365h submitted along with an original abbreviated new drug application.

For more information, click here.

FDA Requests Information on Non-Device Software Functions’ Impact on Patient Safety

On June 18, the Food and Drug Administration announced that it is seeking information on the impacts non-device software functions have on patient safety, specifically those intended for:

• Administrative support of healthcare facilities;
• Encouraging a healthy lifestyle;
• Serving as electronic patient records;
• Transferring, storing, converting formats or displaying data; and
• Providing limited clinical decision support.

Comments are due by July 18. For more information, click here.

Proposed Rules

CMS Proposed Rule Would Establish Increasing Organ Transplant Access Model

On May 8, the Centers for Medicare and Medicaid Services released a proposed rule that would establish the Increasing Organ Transplant Access (IOTA) Medicare payment model. The IOTA Model would be a mandatory, six-year model and would begin on Jan. 1, 2025.

The model aims to:

• Increase access to kidney transplants for end-stage renal disease patients;
• Improve quality of care for people seeking kidney transplants;
• Reduce disparities among individuals undergoing the kidney transplant process; and
• Facilitate the efficiency and capability of transplant hospitals selected to participate.

Public comments will be accepted until July 16, 2024. For more information, click here.

Final Rules

FDA Final Rule Revises Medical Gas CGMP, Postmarketing Safety Reporting and Labeling

On June 17, the Food and Drug Administration (FDA) released a final rule that will revise current good manufacturing practices, postmarketing safety reporting and labeling that apply to certain medical gases. The final rule will:

• Add operations required to produce a medical gas to the list of operations that are performed by its manufacturer;
• Specify requirements for the declaration of net quantity of contents in the labeling of designated medical gases and medically appropriate combinations;
• Require standard format labeling for all designated medical gases;
• Revise medical gas container labeling regulations; and
• Implement medical gas cleaning, adverse event reporting and certification ownership transfer requirements.

The rule will go into effect on Dec. 18, 2025. For more information, click here.

CMS Final Rule Implements Changes Related to Standards for Electronic Prescribing and Health IT

On June 13, the Centers for Medicare and Medicaid Services (CMS) Office of the National Coordinator for Health Information Technology (ONC) released a final rule that will revise Medicare Prescription Drug Benefit and ONC regulations to implement changes concerning required electronic prescribing and health information technology (IT) standards.

The final rule will require Part D sponsors, prescribers and dispensers of covered Part D to:

• Comply with standards CMS has adopted directly or is requiring by cross-referencing standards ONC adopts for electronically transmitting prescriptions; and
• Use National Council for Prescription Drug Programs (NCPDP) Formulary and Benefit (F&B) standard version 3.0 or comply with a standard adopted by ONC after Jan. 1, 2027.

The rule will also require Part D sponsor real-time benefit tools to comply with a standard adopted by ONC and will cross-reference the Health Insurance Portability and Accountability Act of 1996 regulations in 45 CFR part 162 for eligibility transactions.

The rule will go into effect on July 17, 2024. For more information, click here.

FDA Final Rule Allows Owner of Refused Device to Provide Testimony

On May 31, the Food and Drug Administration (FDA) released a final rule that amends a policy that allows the agency to destroy a device valued at $2,500 or less that has been refused admission into the United States (U.S.).

The final rule will allow the owner or consignee of a refused device valued at $2,500 or less to present testimony when the FDA intends to administratively destroy it.

The rule will go into effect on July 1, 2024. For more information, click here.

CMS Final Rule Expands Access to Healthcare for DACA Recipients

On May 3, the Centers for Medicare and Medicaid Services released a final rule to expand access to healthcare for Deferred Action for Childhood Arrivals (DACA) recipients. The rule will allow DACA recipients to:

• Enroll in a Qualified Health Plan through the Affordable Care Act Health Insurance Marketplace; and
• Obtain coverage through a Basic Health Program.

DACA recipients and other newly eligible individuals will be able to select a health plan through the Marketplace during a 60-day special enrollment period following the implementation of the rule.

The rule will go into effect on Nov. 1, 2024. For more information, click here.

HHS OCR Final Rule Strengthens Protections Against Disability Discrimination

On May 1, the Department of Health and Human Services (HHS) Office for Civil Rights released a final rule that prohibits discrimination on the basis of disability and strengthens protections for disabled individuals under Section 504 of the Rehabilitation Act. The rule will:

• Ensure that medical treatment decisions are not based on negative biases and stereotypes about disabled individuals or judgements that a disabled individual is a burden on others;
• Prohibit the use of measures, assessments or tools that discount the value of a life extension on the basis of disability;
• Define what accessibility means for websites and mobile applications and ensure that services delivered through these platforms are accessible to and usable by disabled individuals;
• Adopt U.S. Access Board standards for accessible medical diagnostic equipment;
• Outline requirements to ensure nondiscrimination in the services provided by HHS-funded child welfare agencies; and
• Clarify obligations to provide services in integrated services.

In addition, the rule aligns existing requirements with the Americans with Disabilities Act.

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

DOL EBSA Final Rule Rescinds 2018 Association Health Plan Rule

On April 30, the Department of Labor (DOL) Employee Benefits Security Administration released a final rule that rescinds a DOL final rule released in 2018, which modified the definition of “employer” under federal law and expanded the availability of Association Health Plans.

The U.S. District Court for the District of Columbia ruled that provisions in the rule were an unreasonable interpretation of the Employee Retirement Income Security Act in 2019.

The rule will go into effect on July 1, 2024. For more information, click here.

FDA Releases Final Rule Concerning Laboratory Developed Tests

On April 29, the Food and Drug Administration (FDA) released a final rule that will classify laboratory-developed tests (LDTs) and in vitro diagnostic (IVD) products as medical devices subject to rules under the Federal Food, Drug and Cosmetic Act. The rule will phase out the FDA’s general enforcement discretion approach for most LDTs over four years and require compliance with:

• Medical device regulation, correction and removal reporting and compliant file quality system requirements after one year;
• Registration, listing, labeling and investigational use requirements after two years;
• Quality system requirements in 21 CFR Part 820 after three years;
• Premarket review requirements for high-risk IVDs offered as LDTs (unless a premarket submission has been received by the beginning of this stage) after three and a half years; and
• Premarket review requirements for moderate- and low-risk IVDs after four years.

LDTs developed by a healthcare system laboratory that target unmet needs of patients, those approved by New York State’s Clinical Laboratory Evaluation Program and tests first marketed prior to May 6, are exempted from the rule.

The rule will go into effect on July 5, 2024. For more information, click here.

FTC Final Rule Revises Health Breach Notification Rule

On April 26, the Federal Trade Commission (FTC) released a final rule that revises the Health Breach Notification Rule that requires vendors of personal health records (PHR) and related entities not covered by the Health Insurance Portability and Accountability Act, to notify individuals and the FTC of unsecured PHR data breaches. The rule will:

• Modify the definition of PHR identifiable health information and add new definitions for covered healthcare provider and healthcare services or supplies;
• Clarify that a “breach of security” includes an unauthorized acquisition of identifiable health information that occurs as a result of a data security breach or unauthorized disclosure;
• Revise the definition of a PHR-related entity to make clear that the rule applies to entities that offer products and services through online services, including mobile applications;
• Clarify multiple sources of PHR identifiable health information;
• Expand the use of electronic notification and consumer notice content; and
• Require covered entities to report breaches involving 500 or more individuals to the FTC at the same time notices are sent to affected individuals and no later than 60 calendar days after discovery of the breach.

The rule will go into effect on July 29, 2024. For more information, click here.

CMS Releases Final Rule Concerning Nondiscrimination in Health Programs

On April 26, the Centers for Medicare and Medicaid Services released a final rule that revises Section 1557 of the Affordable Care Act to advance health equity and reduce disparities. The rule will:

• Apply nondiscrimination standards to all Department of Health and Human Services (HHS)-administered health programs and activities;
• Reinstate Section 1557’s application to health insurance issuers that receive federal financial assistance;
• Affirm that sex discrimination protections apply to discrimination on the basis of sexual orientation, gender identity, pregnancy and sex characteristics and stereotypes;
• Require state and federally-facilitated exchanges, recipients of federal financial assistance and HHS programs to inform individuals that language assistance services and auxiliary aids are available; and
• Require covered entities to train staff on Section 1557 policies.

The rule also clarifies nondiscrimination requirements for telehealth services and patient care decision support tools.

The rule will go into effect on July 5, 2024. Some provisions of the rule will be phased in to allow covered entities to come into compliance.

For more information, click here.

CMS Releases Final Rule Concerning Medicaid and CHIP Access to Care

On April 22, the Centers for Medicare and Medicaid Services (CMS) released a final rule that will improve access to care, strengthen quality and health outcomes and address health equity issues for Medicaid and Children’s Health Insurance Program (CHIP) managed care enrollees.

The rule will:

• Establish maximum wait times for obstetric, primary care and outpatient mental health and substance use disorder services;
• Require states to implement a remedy plan for managed care organizations that fail to meet required standards;
• Prohibit the use of separate payment terms;
• Remove the requirement that providers must be in-network with managed care plans to receive state-directed payments; and
• Require managed care plans to report any identified or recovered overpayments to states within 30 calendar days.

In addition, the rule will implement revisions concerning In Lieu of Service and Setting, External Quality Review and the Medicaid and CHIP Quality Rating System.

The rule will go into effect on July 9, 2024. For more information, click here.

CMS Releases Final Rule Concerning Access to Medicaid Services

On April 22, the Centers for Medicare and Medicaid Services (CMS) released a final rule to improve access to care, service quality and outcomes under Medicaid fee-for-service (FFS), managed care and home and community-based services (HCBS). The rule will require states to:

• Rename and expand the scope of Medical Care Advisory Committees and require states to establish a Beneficiary Advisory Committee;
• Meet nationwide incident management system standards for monitoring HCBS programs;
• Ensure that a minimum of 80 percent of Medicaid payments for homemaker, home health aide and personal care services be spent on compensation for direct-care workers furnishing these services within six years;
• Publicly publish all FFS Medicaid fee schedule payment rates; and
• Establish and manage a grievance process for beneficiaries receiving HCBS in FFS plans.

The final rule will go into effect on July 9, 2024. For more information, click here.

HHS OCR Releases Rule Concerning HIPAA Reproductive Care Privacy

On April 22, the Department of Health and Human Services Office for Civil Rights (OCR) released a final rule concerning Health Insurance Portability and Accountability Act (HIPAA) reproductive healthcare privacy provisions. The rule will:

• Prohibit the use or disclosure of reproductive healthcare protected health information (PHI) when it is requested to investigate or impose liability on patients and providers who seek, obtain or provide lawful reproductive healthcare services;
• Require providers, health plans, clearinghouses and business associates to obtain a signed attestation that acknowledges PHI related to reproductive healthcare is not to be used for prohibited purposes; and
• Require providers, health plans and clearinghouses to modify their Notice of Privacy Practices to support reproductive healthcare privacy.

The final rule will go into effect on June 25, 2024. For more information, click here.

FDA Issues Final Rule Regarding Mammography Quality Standards

On March 9, 2023, 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.

Reports

CBO Releases Report Concerning 340B Drug Pricing Program Spending

On June 17, the Congressional Budget Office released a presentation concerning spending in the 340B Drug Pricing Program from 2010 to 2021. The presentation breaks down 340B spending based on facility type and drug class and identifies factors contributing to spending growth.

For more information, click here.

FDA Releases Enhancing Clinical Study Diversity Workshop Report

On June 20, the Food and Drug Administration released a report on the Enhancing Clinical Study Diversity Workshop it held in collaboration with the Clinical Trials Transformation Initiative in November 2023. The report outlines challenges underrepresented populations face when participating in clinical trials and strategies for addressing them.

For more information, click here.

Courts

Fifth Circuit Court of Appeals Issues Ruling in Case Concerning ACA Preventive Services Provision

On June 21, the U.S. Court of Appeals for the Fifth Circuit issued a ruling concerning a lawsuit that could overturn a provision in the Affordable Care Act (ACA) that requires private insurers to cover preventive services without cost-sharing.

The appeals court upheld a district court decision which ruled that nationwide coverage through the Preventive Services Task Force under the ACA is unconstitutional. However, it overturned a nationwide injunction imposed by the district court, which keeps the preventive services provision intact for the majority of Americans. The court ruled that:

• Members of the Task Force must be nominated by the President and confirmed by the Senate; and
• Secretary of the Department of Health and Human Services (HHS) Xavier Becerra and HHS have the right to ratify guidelines recommended by the Advisory Committee on Immunization Practices and the Health Resources and Services Administration under the Appointments Clause. However, the court announced that it is “reserving judgment” on if HHS has “effectively done so”.

The issue will now be sent back to the district court.

Federal District Court Judge Rules Against HHS in Hospital Website Tracking Case

On June 20, U.S. District Court for the Northern District of Texas Judge Mark Pittman ruled that guidance issued by the Department of Health and Human Services (HHS) in 2022 that prohibited the use of third-party online tracking technologies on public-facing hospital web pages was unlawful.

HHS had warned in its guidance that hospitals using tracking tools could expose patients’ protected health information and violate the Health Insurance Portability and Accountability Act. This led to several hospital associations suing HHS. Judge Pittman ruled that the agency had overstepped its authority and vacated the guidance.