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February 6, 2023

This Week in Health Policy for February 3

This Week (Feb. 6-10)

House Energy and Commerce Health Subcommittee and Oversight and Investigations Subcommittee will hold a joint hearing on "The Federal Response to COVID-19.”

  • Date: Wednesday, February 8, 2023, at 10:00 AM ET
  • Witnesses: FDA Commissioner Robert Califf; Lawrence Tabak, Senior official performing the duties of the director of the National Institutes of Health; CDC Director Rochelle P. Walensky; Assistant HHS Secretary for Preparedness and Response Dawn O'Connell
  • More information available here.

Last Week (Jan. 30-Feb. 3)

Health Care Highlights

Congressional committees continue to take shape. This week, the House assumed normal operations, voting on a series of COVID-19 bills and holding hearings on various topics, including the fentanyl crisis and COVID-19-related topics. On Wednesday (Feb. 1), House Minority Leader Hakeem Jefferies (D-NY) announced Democratic appointments to select committees. In the Senate, Minority Leader Mitch McConnell (R-KY) announced Republican committee assignments.

DOJ withdraws health care antitrust policy statements. On Friday (Feb. 3), the Department of Justice (DOJ) said it has withdrawn three antitrust policy statements related to the health care market. DOJ said the statements were “outdated” and that withdrawing them would promote “competition and transparency” in health care. The policies include a 1993 joint statement with the Federal Trade Commission (FTC), a 1996 statement, and a 2011 statement on Medicare Shared Savings Program accountable care organizations. The FTC is expected to take similar action in the coming weeks.

White House announces new Cancer Moonshot actions. On Thursday (Feb. 2), the White House commemorated the one-year anniversary of President Biden’s reignited Cancer Moonshot initiative by announcing the “CancerX” National Innovation Accelerator Initiative, a public-private partnership to support biotech companies and startups focused on cancer; launching a National Cancer Institute-led initiative to fight childhood cancer; and awarding $10 million through the Health Resources and Services Administration to 22 community health centers to support cancer screenings for underserved communities.

CMS announced two big updates for MA plans:

  • On Wednesday (Feb. 1), the Centers for Medicare & Medicaid Services (CMS) published its advance notice of proposed changes to Medicare Advantage (MA) plan capitation rates and Part C and Part D payment policies for calendar year 2024. CMS estimated MA plan revenues would increase by an average 1.03%, down significantly from the more than 8% increase MA plans saw for 2023. The low pay bump stems in part from CMS’ proposal to update the MA risk adjustment model to reflect ICD-10 condition categories, update the model’s fee-for-service data to focus on 2018 diagnoses and 2019 expenditures, changes to limit the model’s sensitivity to coding variation, and a 1.24% cut related to star ratings. In addition, the notice outlines CMS’ proposals to implement the Inflation Reduction Act’s Part D payment policy changes. CMS will accept public comment through March 3, and expects to publish the final rate announcement by April 3.
  • On Monday (Jan. 30), CMS published a rule finalizing its proposal to extrapolate MA Risk Adjustment Data Validation (RADV) audit findings and apply error rates based on a statistically valid data sample across the whole plan. CMS said it will not apply a fee-for-service adjuster, as advocated by MA plans, and said it will extrapolate RADV audit findings beginning in 2025 for the payment year (PY) 2018 RADV audit. CMS said the final rule will apply to all MA plans and projected the agency will recover $479 million in overpayments from MA plans for PY 2018. The agency said it expects to collect $4.7 billion from 2023 to 2032. Insurers are expected to challenge the rule in court.

FTC to fine GoodRx over data sharing. On Wednesday (Feb. 1), the FTC said it will fine GoodRx $1.5 million for sharing users’ private health information with data brokers and advertising platforms such as Facebook and Google despite notifying consumer it would not share personal health information with third parties or advertisers. The action marks the first time FTC has levied penalties on companies for failing to inform consumers of health data sharing or breaches. GoodRx said in a press release that it disagrees with the FTC’s allegations and doesn’t admit wrongdoing

Biden administration to end the PHE on May 11. On Monday (Jan. 30), the Biden administration announced via a Statement of Administration Policy that they plan to end the COVID-19 national emergency and the COVID-19 public health emergency (PHE) on May 11. The national emergency declaration and the PHE are currently set to expire on March 1 and April 11, respectively. This wind-down would align with the Administration’s previous commitments to give at least 60 days’ notice prior to termination of the PHE. While Congress and the administration have taken steps to decouple many health care flexibilities from the PHE end date, others will expire on May 11. The announcement came the same week the House passed four bills related to the COVID-19 pandemic. The bills, which would immediately terminate the PHE and national emergency, eliminate the COVID-19 vaccine mandate for health care workers, and reinstate pre-COVID telework policies at federal agencies, are unlikely to be taken up by the Democratic-controlled Senate.

HHS and DOL propose new contraceptive coverage rule. On Monday (Jan. 30), the U.S. Department of Health & Human Services (HHS) and the Departments of Labor and the Treasury (the Departments) proposed a rule that revises regulations implementing the Affordable Care Act’s (ACA) coverage guarantee for birth control and contraceptive counseling. The latest proposed rule would eliminate the 2018 rule’s exemption for entities with a non-religious moral objection, while maintaining the 2018 rule’s religious exemption. The rule also proposes an independent pathway for individuals enrolled in plans arranged or offered by entities with a religious exemption to contraceptive services to directly access no out-of-pocket cost contraceptive services through a contraceptive provider. The proposed rule will be open for public comment for 60 days beginning February 2.

Drugmakers win appeal in 340B contract pharmacy case. On Monday (Jan. 30), the Third Circuit Court of Appeals ruled that drugmakers can limit the number of contract pharmacies a provider can use to distribute drugs purchased through the 340B drug discount program and invalidated federal guidance and letters seeking to prevent drugmakers from such restrictions. The case – brought by Sanofi Aventis, Novo Nordisk and AstraZeneca Pharmaceuticals against HHS – is one of three cases pending on the subject. Since the ruling, two more drug companies – Bayer and EMD Serono – informed customers they would only offer 340B drug discounts to hospitals and affiliates registered as 340B entities.

Texas Medical Association files fourth lawsuit against No Surprises Act. On Monday (Jan. 31), the Texas Medical Association (TMA) filed a lawsuit challenging CMS’ increased administrative fee for the independent dispute resolution (IDR) process. TMA said the new $350 fee “will make it cost-prohibitive for many providers to access IDR at all.

Hearings and Markups

House Energy and Commerce Subcommittee on Health Hearing on “Lives Worth Living: Addressing the Fentanyl Crisis, Protecting Critical Lifelines, and Combatting Discrimination Against Those with Disabilities”: On Wednesday (Feb.1), the House Energy and Commerce Subcommittee on Health held a hearing during which they heard from two panels of witnesses, including federal officials and patient advocates. Lawmakers on both sides of the aisle raised questions on the best way to reduce the presence of fentanyl in the United States, ways to shore up the 988-crisis line from cyberattacks, and how to protect patients with disabilities from discrimination via QALYs while mitigating the impact on the price of drugs and services.

  • More information available here.

House Energy and Commerce Oversight and Investigations Subcommittee Hearing on “Challenges and Opportunities to Investigating the Origins of Pandemics and Other Biological Events.” On Wednesday (Feb.1), the House Energy and Commerce Oversight and Investigations Subcommittee held a hearing to examine the origins of the COVID-19 pandemic. During the hearing, which largely focused on the findings of a recent Government Accountability Office report on the challenges of investigating virus origins, Republicans asked scientists about research being conducted at a lab facility in Wuhan, China, and whether federal grants should be used to fund virus-modifying studies in China. Democrats on the panel raised concerns about the potential to politicize origin investigations. 

  • More information available here.

House Oversight and Accountability Committee Hearing on "Federal Pandemic Spending: A Prescription for Waste, Fraud and Abuse." On Wednesday (Feb.1), the House Oversight and Accountability Committee held a hearing to examine potential fraud, waste and abuse identified in COVID-19 programs, such as the paycheck protection program. Republicans on the panel also criticized public health measures related to masking, vaccination and physical distancing. Scientists and public health officials who testified said certain precautions were needed to protect people from severe disease.

  • More information available here.

Reports, Studies, and Journals

Kaiser Family Foundation: Over 35 Million Prior Authorization Requests Were Submitted to Medicare Advantage Plans in 2021. The report found Medicare Advantage plans received more than 35 million prior authorization requests in 2021 of which about 2 million, or 6%, were fully or partially denied. The report found 82% prior authorization coverage denial appeals were overturned.

Government Accountability Office: Pandemic Origins: Technologies and Challenges for Biological Investigations. In the report, GAO outlines five policy options to support investigations into pandemic origins, such as expanding the investigation workforce.

Government Accountability Office: Nursing Homes: CMS Should Make Ownership Information More Transparent for Consumers. The report found the Medicare Care Compare website could do more to help consumers identify ownership information of nursing homes.


Contact Information
For additional information concerning this Alert, please contact:
Washington Council Ernst & Young
   •  Heather Bell (