Tax News Update    Email this document    Print this document  

May 3, 2021

This Week in Health Policy for May 3

This Week (May 3 - 7)

The House Energy and Commerce Health Subcommittee holds a hearing on "Negotiating a Better Deal: Legislation to Lower the Cost of Prescription Drugs."

  • Details: 11:30 AM EDT on 05/04/2021
  • More information available here.

The House Education and Labor Health, Employment, Labor, and Pensions Subcommittee holds a hearing on "Lower Drug Costs Now: Expanding Access to Affordable Health Care."

  • Details: 12:00 PM EDT on 05/05/2021
  • More information available here.

Last Week (April 26 - 30)

Health Care Highlights

President Biden addresses joint session. President Biden addressed a joint session of Congress Wednesday (April 28), striking a hopeful tone about the nation’s recovery from the pandemic, calling for action on the American Jobs Plan, a traditional infrastructure proposal, and detailing the American Families Plan, a human infrastructure proposal. On health care, President Biden said they surpassed his promise to provide 100 million COVID-19 vaccine shots in 100 days, providing over 220 million shots but noting that “there’s still more work to do to beat this virus.” As part of his American Jobs Plan, Biden said that the National Institutes of Health (NIH) should create an agency – the Advanced Research Projects Agency – to develop breakthroughs to “prevent, detect, and treat diseases like Alzheimer’s diabetes, and cancer.” He also discussed how the American Rescue Plan lowered health care premiums for 9 million Americans who buy coverage on the Affordable Care Act (ACA) exchanges, saying the provision should be made permanent as done in his American Families Plan. He called the ACA a “lifeline for millions of Americans” but said we should lower deductibles and prescription drug costs to help working families, calling for giving Medicare the power to negotiate lower prices for prescription drugs and using the money to further strengthen the ACA. He said, “this is all about a simple premise: Health care should be a right, not a privilege in America.” Remarks as Prepared for Delivery can be found here.

Biden administration outlines American Families Plan. Prior to President Biden’s address to Congress, the White House outlined their $1.8 trillion American Families Plan, calling for $1 trillion in investments and $800 billion in tax cuts directed at American families and workers, as well as tax code reforms focused on high-income Americans, estimated to raise about $1.5 trillion over a decade. In a background press call on the plan, a senior administration official said Biden’s plan “is about cutting taxes for middle-class families, for childcare, for health care, and for families. And he believes that we should do that in a fiscally responsible way, first and foremost, by making sure the wealthiest Americans actually pay the taxes they already owe.” The plan includes a permanent extension of the enhanced ACA premium tax credits included in the American Rescue Plan, which ensures no one pays more than 8.5% of their income for coverage. Notably absent from the plan, however, are proposals to tackle drug prices and enhance coverage through Medicare and Medicaid expansions, despite pressure from Congressional Democrats to include additional health priorities. Senior White House officials said in a briefing call that while not included in the current proposal, the President “remains fully committed to negotiations to reduce prescription drug prices” and hinted that revenue generated from such a future proposal could be used in “expanding the benefits of Medicare itself.” The fact sheet also notes that “President Biden has a plan to build on the Affordable Care Act and lower prescription drug costs for everyone by letting Medicare negotiate prices… creating a public option and the option for people to enroll in Medicare at age 60, and closing the Medicaid coverage gap to help millions of Americans gain health insurance.” The proposal will have to move through the House and Senate and earn sufficient support in Congress to proceed.

HHS releases new buprenorphine practice guidelines. On Tuesday (April 27), the Department of Health and Human Services (HHS) issued new practice guidelines that would remove training and other requirements for practitioners seeking a wavier to treat patients with opioid use disorder (OUD) with buprenorphine, aimed at removing a barrier to providing treatment amid an increase in overdose deaths and shortage of waivered providers. The new guidance would exempt eligible physicians, physician assistants, nurse practitioners, clinical nurse specialists, certified registered nurse anesthetists, and certified nurse midwives from federal certification requirements related to training, counseling, and other ancillary services that are part of the process for obtaining a waiver to treat up to 30 patients with buprenorphine.

CMS issues FY2022 IPPS proposed rule. On Tuesday (April 27), the Centers for Medicare & Medicaid Services (CMS) under President Biden issued their first big annual payment rule, updating Medicaid payment policies for inpatient hospitals under the Inpatient Prospective Payment System (IPPS). The rule would increase payments by 2.8%, or approximately $2.5 billion, for FY2022 and makes a variety of other changes to quality reporting programs and risk-based models, among other items, in light of the ongoing COVID-19 public health emergency (PHE). This includes proposals to:

  • Extend COVID-19 treatments add-on payments beyond the end of the PHE;
  • Suppress most Hospital-Value-Based Purchasing (HVBP) Program measures so that hospitals would receive neutral payment adjustments under the program for FY2022;
  • Allow eligible Accountable Care Organizations (ACOs) participating in the BASIC track’s glide path option to pause their automatic advancement along the glide path’s increasing levels of risk;
  • Repeal a requirement finalized last year that hospitals report their median payer-specific negotiated rates for inpatient services, by Medicare Severity-Diagnosis Related Group, for Medicare Advantage organizations.

The proposed rule also includes two requests for information (RFI):

  • “RFI on Advancing to Digital Quality Measurement and the Use of Fast Healthcare Interoperability Resources (FHIR) in Hospital Quality Programs” aimed at gathering input for planning purposes for the transition to digital quality measurement, and
  • “RFI on closing the Health Equity Gap in CMS Hospital Quality Programs,” regarding the potential stratification of quality measure results by race and ethnicity and the potential creation of a hospital equity score in CMS quality reporting and value-based purchasing programs.

The rule also implements several provisions of the Consolidated Appropriations Act, including distributing 1,000 new Medicare-funded medical residency positions, which will be capped at one FTE per hospital per year, and implementing the Promoting Rural Hospital GME Funding Opportunity, which would allow certain rural training hospitals to receive a GME cap increase.

Other CMS activity. CMS also extended the Comprehensive Care for Joint Replacement model for three years, through December 31, 2024 and issues the second 2022 Notice of Benefit and Payment Parameters final rule, which includes provisions to lower maximum out-of-pocket costs to consumers in 2022 federal health insurance marketplace plans by $400 and increase opportunities to qualify for special enrollment periods, particularly those hardest hit by COVID-19.

COVID-19 updates:

  • Relaxed CDC guidance on outdoor mask-wearing. The Centers for Disease Control and Prevention (CDC) issued relaxed guidance on outdoor mask-wearing for fully vaccinated people this week, saying they can forgo masks when exercising or gathering in small groups outside, but should still wear them at crowded outdoor venues and at medium-sized gatherings, as well as indoor venues. Governors in California, New York, Louisiana, Maine and Massachusetts all eased their mask restrictions after the agency's announcement.
  • Restricted travel from India. On Friday (April 30), the White House announced it would restrict travel from India starting at midnight on Tuesday, May 4. The Biden administration cited a steep rise in coronavirus cases in the country and the possible emergence of multiple variants. The policy won't apply to American citizens, permanent residents or other people with exemptions.
  • U.S. joins other countries in support to India. The U.S. is sending financial support and raw materials for COVID-19 vaccines to India in light of its surge in new cases and deaths, joining the United Kingdom, France, and Germany in pledging aid.
  • CDC and FDA lift pause on J&J shots. Vaccination sites across the country resumed using Johnson & Johnson's COVID-19 shot this week after the CDC and Food and Drug Administration (FDA) lifted their recommendation to pause the rollout, following a thorough safety review and outreach to providers and clinicians to ensure they were made aware of the potential for adverse events.


Ways and Means Health Subcommittee Hearing on Charting the Path Forward for Telehealth. On Wednesday (April 28) the House Ways and Means Subcommittee on Health held a hearing entitled, “Charting the Path Forward for Telehealth.” Throughout the hearing, committee members and panelists applauded the promise of telehealth in expanding access to care while also cautioning that telehealth should be treated as complementary to in-person care and just one part of a robust “toolkit” for providers. Several members and panelists noted how mental health is an area particularly well suited for telehealth, and other suggested leveraging telehealth for certain chronic conditions. There was general consensus that shifting toward value-based and alternative payment models that reward outcomes will enable providers to take advantage of telehealth and other new technologies without added burden. When considering barriers to uptake, committee members and panelists supported addressing broadband access and discussed how to ensure telehealth does not exacerbate existing inequalities, such as through provision of culturally-competent care and collection of patient outcomes and experience data disaggregated by race, ethnicity, and other key factors. There was a divergence of opinion on the panel with those who thought we should move forward with permanently expanding the pandemic telehealth flexibilities to encourage providers to continue investing in these technologies and retaining the option for patients, with those who cautioned that we need more, non-pandemic data and that we should extend the flexibilities for a short period of time to inform policy moving forward.

HELP Committee Hearing on COVID-19 Lessons Learned for Addressing Mental Health and Substance Use Disorders. On Wednesday (April 28) the Senate Committee on Health, Education, Labor & Pensions (HELP) held a hearing entitled, “Examining Our COVID-19 Response: Using Lessons Learned to Address Mental Health and Substance Use Disorders,” where the committee heard testimony from mental health and substance use providers and leaders of state, academic, and community programs. Throughout the hearing, the witnesses stressed the need to properly integrate mental and behavioral health care into primary care, such as through collaborative care models, transform the delivery of behavioral health care through telehealth and new payment models, bolster the behavioral health workforce, and build out partnerships and mental health capacity across local communities. They stressed the need to make permanent telehealth flexibilities and provide additional funding and incentives through grant funding to properly train, recruit, and retain the mental health workforce, specifically in underserved areas, and remove barriers to treatment, such as lifting the waiver required for prescribing MAT and addressing barriers to care such as lack of transportation and issues of stigma and trust. Other topics included the Medicaid Reentry Act – which would allow Medicaid to cover services for beneficiaries who are incarcerated 30 days prior to their release, integration of mental health care during pregnancy, and eliminating repercussions of providers reporting mental health issues to regulatory and licensing agencies.

Reports, Studies, and Journals

National Bureau of Economic Research: Merchants of Death: The Effect of Credit Supply Shocks on Hospital Outcomes. Overall, the results indicate that access to credit can affect the quality of healthcare hospitals deliver, pointing to important spillover effects of credit market frictions on health outcomes.

Kaiser Family Foundation: Health Spending for 60-64 Year Olds Would Be Lower Under Medicare Than Under Large Employer Plans. While health care spending increases with age within a given payer type, the analysis shows substantially higher per person spending among 60-64 year olds in large employer plans than among 65-69 year olds in Medicare, primarily reflecting the differences in payment rates.

National Bureau of Economic Research: Medicaid and Fiscal Federalism During the COVID-19 Pandemic. Researchers analyzed the effects of the COVID-19 pandemic on state and local government finances, with an emphasis on health spending needs and the role of the Medicaid program.


Contact Information
For additional information concerning this Alert, please contact:
Washington Council Ernst & Young
   •   Any member of the group at (202) 293-7474.