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November 8, 2021

This Week in Health Policy for November 8

This Week (November 8 - 12)

The House and Senate are scheduled to be in recess next week.

Last Week (November 1 - 5)

Health Care Highlights

Prescription drug pricing proposal added to BBB. On Tuesday (Nov. 2), Congressional leaders announced Democrats reached a bicameral agreement on drug pricing provisions aimed for inclusion in the Build Back Better Act (BBB) Act (H.R. 5376). Two Democrats who opposed an earlier, more expansive proposal, Sen. Kyrsten Sinema (D-AZ) and Rep. Scott Peters (D-CA), said they supported the plan, however there is an expectation that additional changes may be made in the Senate if it is passed through the House. According to a preliminary score from the Congressional Budget Office (CBO), the provision would save about $100 billion in addition to the $150 billion saved by repealing the Trump-era drug rebate rule. The new drug pricing proposal includes three main provisions:

  • Providing the authority for Medicare to negotiate drug prices outside their initial exclusivity period. The provision would allow Medicare to negotiate 10 of the highest spending Part B and D drugs outside their initial exclusivity periods, as well as insulin products, beginning in 2025 and reaching 30 drugs in 2028 in and beyond. Single-source chemical drugs that have been on the market at least 9 years and biologics that are more that 12-years-old would be eligible, however it is reported that an updated version would allow biologics an additional year. The price ceiling would be based on how long the drug has been on the market, including 75% of the average manufacturer price for those 9 to 12 years old and 40% for those more than 16 years old. Insurers could not apply a deductible or charge patients more than $35 or 25% of the negotiated rate for insulin products.
  • Inflation rebates: Drugmakers would have to repay the government the difference in profits above the cost of inflation on Part B and D drugs if they raise the price of a drug above inflation, beginning July 1, 2023. Drugmakers that don't provide the rebates would face a penalty up to 125% of the rebate amount.
  • Redesigning the Part D benefit to protect seniors from high out-of-pocket spending. The provision creates an annual out-of-pocket patient spending cap of $2,000 and caps insulin co-pays at $35 per month. It also eliminates the coverage gap, or "donut hole" phase of the benefit and shifts more costs onto manufacturers and plans. Plans would be responsible for 60% of the costs in the catastrophic phase of the benefit and manufacturers would be responsible for 20% of the costs for brands, biologics and biosimilars and 0% for generics.

The proposal also includes special rules for small biotech companies, including exempting them from negotiation for the first three years (until 2028); exempting drugs that contribute less than $200 million in Medicare spending; phasing-in reductions from negotiations; and phasing in liability in Part D redesign for 6 years.

Biden administration announces vaccination policies for large employers and health care workers. On Thursday (Nov. 4), the Biden administration issued two highly anticipated and controversial rules requiring vaccinations for large employers and health care workers. The Occupational Safety and Health Administration (OSHA) Emergency Temporary Standard (ETS), which covers 84 million employees, requires employers with 100 or more employees to ensure each of their workers is fully vaccinated or tests for COVID-19 at least once a week. An interim final rule (IFR) with comment period from the Centers for Medicare & Medicaid Services (CMS) requires that health care workers at facilities participating in Medicare and Medicaid are fully vaccinated, with no testing option. This rule covers more than 17 million workers at approximately 76,000 health care facilities around the country. Employees falling under the OSHA ETS, CMS IFR, or the previously issued federal contractor rules will need to have their final vaccination dose by January 4, 2022. The new effective date for federal contractors is four weeks later than the original December 8 deadline. House Energy & Commerce Committee Republicans say they're considering all options to overturn the CMS mandate, including the Congressional Review Act, citing concerns shared with nursing homes that the rule will exacerbate staffing shortages.

CDC recommends Pfizer COVID-19 vaccine for kids 5-11. On Tuesday (Nov. 2), the Centers for Disease Control and Prevention (CDC) recommended Pfizer's COVID-19 vaccine for children between the ages of 5 and 11, hours after the agency's Advisory Committee on Immunizations Practices voted unanimously in favor of recommending the vaccine for all children in that age group. This was despite FDA's vaccine advisers calling for the CDC panel to only recommend the vaccine for high-risk children. Now that CDC has signed off on the recommendations, the White House has begun shipping out 15 million pediatric doses of Pfizer's pediatric vaccine nationwide and committed to getting the vaccine program for younger children fully up and running during the week of November 8. The pediatric vaccine will be administered to the younger age group as a two-dose regimen of 10 micrograms each given 21 days apart, which is lower than the two-dose regimen of 30 micrograms each currently used in patients 12 and older.

HHS finalizes physician, outpatient, and home health payment rules. On Tuesday (Nov. 2), The Centers for Medicare & Medicaid Services (CMS) finalized three payment rules: CMS' Calendar Year (CY) 2022 Physician Fee Schedule (PFS); CY 2022 Hospital Outpatient Prospective Payment System (OPPS) and Ambulatory Surgical Center (ASC) Payment System; and CY 2022 Home Health Prospective Payment System (PPS).

  • Physician payment rule: The PFS conversation factor is cut by $1.30 to $33.59 for 2022 as the temporary 3.75 percent reimbursement boost provided by the Consolidated Appropriations Act (CAA) expires next year. The PFS also updated clinical labor pricing, which will benefit primary care specialists; however, payment to specialties such as interventional radiology, vascular surgery, radiation oncology, and cardiology will see reduced reimbursements as a result of the payment changes. The PFS also extended certain Medicare telehealth benefits added during the pandemic through December 31, 2023, which CMS says will allow "additional time for us to evaluate whether the services should be permanently added to the Medicare telehealth services list." CMS is also expanding reimbursements for telehealth services that treat mental health issues under the rule. For more information on the PFS final rule: Press release, fact sheet and final rule.
  • OPPS rule: As a part of the OPPS rule, CMS finalized stricter penalties for hospitals that don't comply with the hospital price transparency regulations, which went into effect January 1 of this year. CMS is setting a minimum penalty of $300 per day for hospitals with a bed count of 30 or fewer, and a penalty of $10 per bed per day for hospitals with a bed count greater than 30, not to exceed a maximum daily dollar amount of $5,500. CMS also paused plans to phase out the inpatient only (IPO) list, which includes services that can only be performed in hospitals. The final rule also continued reductions for 340B drug discount payments and site neutral payment provisions. For more information on the OPPS/ASC final rule: Press release, fact sheet and final rule.
  • Home health: The home health final rule formalized the nationwide expansion of the Home Health Value-Based Purchasing Model, starting in 2023, makes various changes to quality programs, and establishes survey and enforcement requirements for hospice programs serving Medicare beneficiaries, among other items. For more information on the Home Health PPS final rule: Press release, fact sheet and final rule.

Hearings and Markups

E&C health subcommittee advances nine public health bills to full committee. On Thursday (Nov. 4), the Energy & Commerce (E&C) Subcommittee on Health advanced nine public health bills to the full committee:

  • H.R. 1193, the "Cardiovascular Advances in Research and Opportunities Legacy Act," which seeks to expand research on valvular heart disease (VHD) and its treatment.
  • H.R. 1667, the "Dr. Lorna Breen Health Care Provider Protection Act," which requires HHS to award grants for relevant mental and behavioral health training for health care students, residents, or professionals, among other actions.
  • H.R. 3297, the "Public Health Workforce Loan Repayment Act of 2021," which would establish a student loan repayment program for public health professionals at HHS.
  • H.R. 3320, the "Allied Health Workforce Diversity Act of 2021," which would allow HHS to award grants and contracts to accredited education programs to increase diversity in the physical therapy, occupational therapy, respiratory therapy, audiology, and speech-language pathology professions
  • H.R. 3537, the "Accelerating Access to Critical Therapies for ALS Act," to direct HHS to support research on, and expanded access to, investigational drugs for amyotrophic lateral sclerosis (ALS).
  • H.R. 4555, the "Oral Health Literacy and Awareness Act of 2021," to authorize a public education campaign across all relevant programs of the Health Resources and Services Administration (HRSA) to increase oral health literacy and awareness.
  • H.R. 5487, the "Stillbirth Health Improvement and Education for Autumn Act of 2021" or the "SHINE for Autumn Act of 2021," which seeks to improve research and data collection on stillbirths.
  • H.R. 5551, the "Improving the Health of Children Act," which reauthorizes the National Center on Birth Defects and Developmental Disabilities (NCBDDD) at CDC for five years until 2026
  • H.R. 5561, the "Early Hearing Detection and Intervention Reauthorization Act," which extends the authorization for Early Hearing Detection and Intervention programs at HRSA, CDC, and NIH.

More information available here.

HELP Committee hearing on the COVID-19 response. On Thursday (November 4), the Senate Health, Education, Labor and Pensions (HELP) Committee held a hearing entitled, "Next Steps: The Road Ahead for the COVID-19 Response," featuring testimony from Rochelle Walensky, Director of the CDC; Anthony Fauci, Director of the National Institute of Allergy and Infectious Diseases (NIAID); Janet Woodcock, Acting Commissioner of the FDA; and Dawn O'Connell, Assistant Secretary for Preparedness and Response at HHS. Chairwoman Patty Murray (D-WA) and other democrats on the committee commended President Biden for his work to fight the pandemic but cautioned that it is not over. Sen. Murray called for following the science and increasing vaccination numbers while emphasizing the effectiveness of vaccine mandates. She also touted the BBB plan's investments in increased testing capacity and updated data systems. Ranking Member Richard Burr (R-NC) emphasized the need for strong leadership and additional tools to deal with COVID-19. Like other committee Republicans, he urged the witnesses to back away from vaccine mandates and instead focus on better communication of real-time data and better testing availability. The witnesses echoed the need for better preparation for future pandemics through investments in public health infrastructure and data collection capacities, and emphasized that the most powerful tool in ending the pandemic is vaccination. They also noted that accurate at-home tests and ensuring capacity across all types is a high priority.

Reports, Studies, and Journals

Center On Budget And Policy Priorities: Marketplaces Poised for Further Gains as Open Enrollment Begins. Marketplace enrollment gains will likely continue to build in the upcoming open enrollment period, when people sign up for and renew plans for 2022.

National Bureau of Economic Research: Does Research Save Lives? The Local Spillovers of Biomedical Research on Mortality. The results show that an additional research publication on average reduces local mortality from a disease by 0.35%.

Health Affairs. ACA Marketplaces Became Less Affordable Over Time For Many Middle-Class Families, Especially The Near-Elderly. In 2015 half of a middle-class population would have paid at least 7.7 percent of their income for the lowest-cost bronze plan; in 2019 they would have paid at least 11.3 percent of their income. By 2019 half of the near-elderly ages 55-64 would have paid at least 18.9 percent of their income for the lowest-cost bronze plan in their area


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