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April 25, 2023

Special Edition | This Week in Health Policy, Spring Payment Rule Update and Other Recess Activity

This Week (April 24 - 28)

Ways and Means Oversight Subcommittee will hold a hearing on "Tax-Exempt Hospitals and the Community Benefit Standard."

  • Date: Wednesday, April 26 at 2:00PM ET
  • More information available here.

House Energy and Commerce Health Subcommittee will hold a legislative hearing on "Lowering Unaffordable Costs: Legislative Solutions to Increase Transparency and Competition in Health Care."

  • Date: Wednesday, April 26 at 10:00AM ET
  • More information available here.

House Committee on Education and the Workforce Subcommittee on Health, Employment, Labor and Pensions will hold a hearing on "Reducing Health Care Costs for Working Americans."

  • Date: Wednesday, April 26 at 10:15AM ET
  • More information available here.

House Appropriations Labor-HHS Subcommittee will hold a hearing on "Provider Relief Fund and Healthcare Workforce Shortages."

  • Date: Wednesday, April 26 at 10:10AM ET
  • More information available here.

House Energy and Commerce Innovation, Data, and Commerce Subcommittee will hold a hearing on "Addressing America's Data Privacy Shortfalls: How a National Standard Fills Gaps to Protect Americans' Personal Information."

  • Date: Thursday, April 27 at 2:00PM ET
  • More information available here.

House Energy and Commerce Oversight and Investigations Subcommittee will hold a hearing on "Biosafety and Risky Research: Examining if Science is Outpacing Policy and Safety."

  • Date: Thursday, April 27 at 2:30PM ET
  • More information available here.

House Energy and Commerce Oversight and Investigations Subcommittee will hold a hearing on "Antimicrobial Resistance: Examining an Emerging Public Health Threat."

  • Date: Friday, April 28 at 9:00AM ET
  • More information available here.

Last Week (April 17 - 21)

Health Care Highlights

Congress returns and turns its focus to debt limit, budget, and health priorities. Congress returned from a two-week recess this week, kicking off a work period that will include the debt limit and health care priorities among other things. On Wednesday (April 19), House Republicans unveiled their highly anticipated debt limit plan which would suspend the debt limit through the earlier of March 31, 2024, or $1.5T and set discretionary spending limits at FY 2024—2033 levels and limits growth to 1% per year. The plan also includes several health care items, including recission of unobligated COVID funding, raising the age limit on work requirements to receive Supplemental Nutrition Assistance Program (SNAP) benefits from 50 to 56 years old, recalibrating TANF funding, and applying work requirements to applicable individuals in Medicaid. As House Speaker Kevin McCarthy (R-CA) promised, the plan does not include any changes to Medicare or Social Security. The plan is a stark contrast to President Biden's FY 2024 budget proposal, which includes spending increases, and his and Democrats' calls to pass a clean debt limit increase. For a refresher on the health care highlights in Biden's FY 2024 budget proposal click here.

HHS publishes hospice, home health ownership data. On Thursday (April 20), the Department of Health and Human Services (HHS) announced it has made ownership data for all Medicare-certified hospice and home health agencies publicly available. The move builds on President Biden's executive order on promoting competition and is part of the agency's efforts to increase transparency around ownership of hospitals and nursing homes.

Supreme Court action on Mifepristone looming. On Wednesday (April 19), the Supreme Court temporarily extended an order maintaining Food and Drug Administration (FDA) approval of Mifepristone until 11:59pm ET Friday. The court is expected to weigh in on whether medication abortion can be rolled back in states where abortion is legal. The case comes in response to conflicting court opinions: one from Texas, which struck down FDA's approval of Mifepristone, and one from Washington, which barred the FDA from restricting availability of Mifepristone. An appeals court left in place parts of the Texas ruling. Separately, on Wednesday (April 19), GenBioPro, which makes a generic version of Mifepristone, sued the FDA in an effort to prevent the agency from rolling back access to the drug if the appeals court ruling is allowed to stand.

Appeals court upholds federal contractor vaccine mandate. On Wednesday (April 19), the 9th Circuit Court of Appeals lifted a lower court's injunction on the Biden administration's COVID-19 vaccine mandate for federal contractors, allowing the mandate to resume.

HHS unveils effort to help uninsured access COVID-19 care. On Tuesday (April 18), HHS announced a $1.1 billion public-private program, called HHS Bridge Access Program For COVID-19 Vaccines and Treatments, to help uninsured Americans maintain access to no-cost COVID-19 vaccines and treatments through their local pharmacies and health centers. HHS said it will use COVID-19 supplemental funds to support the program through 2024.

FTC countersues to pause Louisiana-based hospital acquisition. On Thursday (April 20), the Federal Trade Commission (FTC) filed a countersuit to pause LCMC Health's acquisition of three Louisiana-based HCA Healthcare hospitals. The move comes one day after the health systems sued the FTC and Department of Justice over penalties related to unfiled paperwork. The health systems argue they are not required to file the paperwork, but FTC Chair Lina Khan said they are required to do so by law.

Biden signs EO to bolster long-term care, childcare workforce. On Tuesday (April 18), President Biden signed an executive order (EO) that seeks to improve the long-term care and childcare workforce. The EO includes directives for federal agencies, including HHS, to identify grant opportunities to support long-term workers, improve the quality of home care jobs, and test a new dementia care model to support caregivers. Many of these policies would require Congressional action and funding increases. Biden's FY 2024 budget includes $150 billion over the next decade to improve and expand Medicaid home care services — but those funding increases face a steep hill in a divided Congress where Republicans are focused on spending reductions.

CMS issues 2024 Notice of Benefit and Payment Parameters final rule. On Monday (April 17), the Centers for Medicaid and Medicaid Services (CMS) issued the 2024 Notice of Benefit and Payment Parameters final rule. The rule includes an optional special enrollment period for federally facilitated and state-based exchanges allowing people to select an exchange plan 60 days before or up to 90 days after losing Medicaid or CHIP coverage. In addition, the rule expands the essential community provider (ECP) threshold (35% in service area) to include substance use disorder treatment centers and mental health facilities, removes network adequacy and ECP standard exceptions for plans without a provider network, but adds an exception for certain stand-alone dental plans. CMS in the rule delayed implementation of new appointment wait time standards until plan year 2025 and walked back its proposed limit on the number of non-standardized plan options an insurer could offer. Plans under the rule will be able to offer four non-standardized plans, up from two in the proposed rule. Click here for the press release and here for the fact sheet.

HHS issues guidance on new Medicaid waiver opportunity. On Monday (April 17), CMS announced a new Medicaid Reentry Section 1115 Demonstration Opportunity that would enable state Medicaid programs to cover a range of health services, including substance use disorders and other chronic health conditions, for up to 90 days prior to the individual's expected release date.

ICYMI: CMS Kicks Off Annual Payment Rule Process and Issues Additional Health Rules

CMS issues FY 2024 IPPS and LTCH proposed rule. On Monday April 10, CMS issued the fiscal year (FY) 2024 proposed rule for the Hospital Inpatient Prospective Payment System (IPPS) and Long-Term Care Hospital (LTCH) Prospective Payment System. The rule proposes to increase FY 2024 acute care hospital operating payments by about 2.8%, compared with FY 2022. CMS estimates the overall impact of the rule would result in an increase of about $2.7 billion in payments to acute care hospitals paid under the IPPS in FY 2024. CMS expects the LTCH standard payment rate to increase by 2.9% and LTCH PPS payments for discharges paid the LTCH standard payment rate to decrease by approximately 2.5% or $59 million. Medicare disproportionate share hospital payments and Medicare uncompensated care payments under the proposal would decrease next year by about $115 million, and additional payments for inpatient cases involving new medical technologies would be reduced by $460 million. Throughout the rule, CMS proposes several ways to increase health equity, an ongoing priority for the Biden administration. CMS also proposes updates to hospital quality and value-based payment programs, among other changes. CMS will accept public comments on the proposed rule through June 9. Click here for CMS' press release, here for the fact sheet, and here for the proposed rule. To learn more, check out WCEY's overview of the proposed rule.

CMS issues FY 2024 hospice proposed payment rule. On Friday (March 31), CMS issued the FY 2024 Hospice Payment Rate Update Proposed Rule. In the rule, CMS proposed increasing payments to hospices by 2.8%, or $720 million for FY 2024, compared with FY 2023, as well as updates to the Hospital Quality Reporting Program (HQRP), telehealth waiver deadlines, and physician certification requirements. CMS is accepting public comments on the proposals until May 30, 2023. Click here for CMS' fact sheet and here for the proposed rule. To learn more, check out WCEY's overview of the proposed rule.

CMS issues FY 2024 Inpatient Rehabilitation Facility proposed payment rule. On April 3, CMS issued the FY 2024 Inpatient Rehabilitation Facility (IRF) Prospective Payment System Proposed Rule. In the rule, CMS proposed increasing payments to IRFs by 3.7%, or $335 million for FY 2024, compared with FY 2023, including adjustment for higher outlier payments. CMS also proposed updates to the IRF Quality Reporting Program and the excluded unit regulation. CMS is accepting public comments on the proposals until June 2, 2023. Click here for CMS' fact sheet and here for the proposed rule.

CMS issues FY 2024 Skilled Nursing Facility proposed payment rule. On April 4, CMS issued the Fiscal Year (FY) 2024 Skilled Nursing Facility (SNF) Prospective Payment System Proposed Rule. In the rule, CMS proposed increasing payments to SNF by 3.7%, or $1.2 million for FY 2024, compared with FY 2023, as well as updates to the Patient Driven Payment Model ICD-10 code mappings, the SNF Quality Reporting Program, the Value-based Purchasing Program, and civil money penalties. CMS said it is still reviewing minimum staffing requirements, which are expected this spring. CMS is accepting public comments on the proposals until June 5, 2023. Click here for CMS' fact sheet and here for the proposed rule.

CMS issues 2024 Medicare Advantage and Part D Final Rule. On April 5, CMS issued the Calendar Year (CY) 2024 Medicare Advantage (MA) and Part D Final Rule. The final rule includes several updates to the MA and Part D programs, including adding new requirements to address potentially misleading advertising, improving prior authorization processes, and increasing access to mental health. The rule also adjusts Star Ratings measures, including finalizing a new health equity index (HEI) reward. Click here for CMS' press release, here for the fact sheet, and here for the final rule. To learn more, check out WCEY's overview of the final rule.

CMS issues CY 2024 Medicare Advantage Rate Announcement. On March 31, CMS issued the CY 2024 MA and Part D Rate Announcement, which includes a projected 3.32% payment bump for MA plans in CY 2024. CMS in the Rate Announcement finalized its controversial update to the MA risk adjustment model, but instead of implementing all of the changes in 2024, the agency said it will phase the changes in over a three-year period. Technical updates to medical education payments in the Non-End-Stage Renal Disease (ESRD) United States Per-Capita Cost (USPCC) baseline will also be phased in. Click here for CMS' press release, here for the fact sheet, and here for the rate announcement. To learn more, check out WCEY's overview of the rate announcement.

HIPAA reproductive proposed rule. On April 12, HHS' Office for Civil Rights (OCR) issued a proposed rule that would prohibit entities subject to the HIPAA Privacy Rule from using or disclosing protected health information to "investigate, or prosecute patients, providers" or others involved in "legal reproductive care, including abortion care." The proposal would protect data related to prenatal care, abortion, miscarriages, infertility, contraception, and treatment of conditions such as ovarian cancer. OCR will accept public comment for 60 days.

21st Century Cures Proposed Rule. On April 11, the Office of National Coordinator for Health IT (ONC) issued a proposed rule that would update certification requirements for health IT developers under its Health IT Certification Program. ONC will accept comments until June 20.

CMS extends VBID model. On April 5, CMS published a fact sheet on the Medicare Advantage Value-Based Insurance Design (VBID) Model extension for calendar years 2025 through 2030, which includes changes intended to more fully address the health-related social needs of patients, advance health equity and improve care coordination for patients with serious illness.

ICYMI: Biden Administration Issues More COVID-PHE wind down updates

OCR updates guidance on telehealth enforcement discretion. On April 11, HHS published a notice stating that enforcement discretion notification issued by HHS' Office for Civil Rights regarding certain HIPAA and HITECH Act violation penalties will expire with the COVID-19 PHE at 11:59 PM on May 11. Those notifications include:

  • Enforcement Discretion Under HIPAA To Allow Uses and Disclosures of Protected Health Information by Business Associates for Public Health and Health Oversight Activities in Response to COVID-19, issued April 7, 2020
  • Enforcement Discretion Regarding COVID-19 Community-Based Testing Sites (CBTS) During the COVID-19 Nationwide Public Health Emergency, issued March 13, 2020.
  • Enforcement Discretion Regarding Online or Web-Based Scheduling Applications for the Scheduling of Individual Appointments for COVID-19 Vaccination During the COVID-19 Nationwide Public Health Emergency, issued December 11, 2020
  • Notification of Enforcement Discretion for Telehealth Remote Communications During the COVID-19 Nationwide Public Health Emergency ("Telehealth Notification"), issued March 17, 2020

OCR said it will give providers a 90-calendar day transition period to align their telehealth practices with HIPAA rules, meaning by August 9 providers will no longer be able to use popular audio-visual applications that are not HIPAA compliant, such as FaceTime, Zoom, Facebook Messenger video chat, Google Hangouts video, or Skype.

Biden admin launches project to generate new COVID treatments. On April 10, the Biden administration announced plans to launch a $5 billion-plus program, called "Project Next Gen," to partner with private-sector companies to accelerate the development of new coronavirus vaccines and treatments. White House coronavirus coordinator Ashish Jha, head of the COVID task force which is disbanding next month.

CMS publishes FAQs on COVID-19 coverage post-PHE. On March 29, CMS released FAQs prepared by the Departments of Labor, HHS, and the Treasury on COVID-19 coverage after the public health emergency ends. The FAQs address COVID-19 diagnostic testing, vaccines and preventive services, as well as the timeframes to complete certain employee benefit elections or other coverage-related actions, such as steps to take after losing Medicaid or Children's Health Insurance Program coverage as part of the redeterminations process set to begin April 1.

Biden signs bill ending National Emergency. On April 10, President Biden signed into law a bill immediately ending the national emergency declaration. The change could have implications for certain coverage-related waivers and provider waivers: 1) allowing hospitals to screen patients offsite to prevent the spread of COVID-19; 2) waiving the requirement for hospices to provide certain noncore hospice services (i.e. physical therapy, occupational therapy, and speech-language pathology). CMS has stated that the national emergency ending will not impact HHS operations or "existing waivers currently in effect and authorized under the 1135 waiver authorization for the pandemic."

Hearings, Markups, and Other Committee Action

Senate Finance Committee unveils bipartisan framework on "for Reducing Prescription Drug Costs by Modernizing the Supply Chain and Ensuring Meaningful Relief at the Pharmacy Counter." On Thursday (April 20), Committee leaders released a bipartisan framework for addressing "misaligned incentives" for pharmaceutical benefit managers (PBMs). The framework includes a list of policy solutions the Committee will examine moving forward, including disconnecting PBM compensation from drug prices to align incentives for lower costs; enhancing PBM accountability to health plan clients; ensuring discounts negotiated by PBMs produce meaningful savings for seniors; addressing and mitigating practices that unfairly inflate the prices patients and government programs pay for prescription drugs; modernizing Medicare's "Any Willing Pharmacy" requirements to improve options and access for seniors; and increasing transparency to foster a better understanding of how financial flows across the prescription drug supply chain affect government health care programs.

House Energy & Commerce Health Subcommittee Legislative Hearing on "Examining Existing Federal Programs to Build a Stronger Health Workforce and Improve Primary Care." On Wednesday (April 19), the House Energy and Commerce Health Subcommittee held a legislative hearing during which they discussed eight measures on federal programs intended to bolster the health care workforce and primary care. Subcommittee members heard testimony from Health Resources and Services Administration Administrator Carole Johnson.

  • More information available here.

House Energy & Commerce Oversight and Investigations Subcommittee Hearing on "Who is Selling Your Data: A Critical Examination of the Role of Data Brokers in the Digital Economy." On Wednesday (April 19), the Subcommittee held a hearing on data brokers during which lawmakers and witnesses called for increased transparency. Witnesses included Justin Sherman, senior fellow and research lead at Duke University's Sanford School of Public Policy; Marshall Erwin, vice president and chief security officer Mozilla Corporation; and Laura Moy, associate professor of law and faculty director at the Center on Privacy & Technology at Georgetown Law.

  • More information available here.

House Energy & Commerce Oversight and Investigations Subcommittee Hearing on "Insights from the HHS Inspector General on Oversight of Unaccompanied Minors, Grant Management, and CMS." On Tuesday (April 18), the Subcommittee held a hearing with testimony from the Office of Inspector General's Christi Grimm during which Grimm highlighted several OIG reports regarding HHS' handling of unaccompanied minors, NIH grant management, and fraud within the Medicare and Medicaid programs.

  • More information available here.

Appropriations Committee budget hearing on "Fiscal Year 2024 Request for the Centers for Disease Control and Prevention, Administration for Strategic Preparedness and Response, and National Institute of Health." On Wednesday (April 19), the Committee held a hearing on the FY 2024 budget request for CDC, ASPR, and NIH. During the hearing, lawmakers heard testimony from CDC Director Rochelle Walensky, NIH acting Director Lawrence Tabak, and Dawn O'Connell, assistant secretary for preparedness and response.

  • More information available here.

Senate Foreign Relations Committee hearing on "PEPFAR AT 20: ACHIEVING AND SUSTAINING EPIDEMIC CONTROL." On Wednesday (April 19), the Committee held a hearing on the President's Emergency Plan for AIDS Relief (PEPFAR) reauthorization. During the hearing, Committee leaders voiced support for a "clean reauthorization" and members heard testimony from witnesses who praised the global health program targeting HIV and AIDS. Some witnesses raised concerns about proposals, such as the one included in President Biden's FY 2024 budget, to reduce PEPFAR's funding.

  • More information available here.

House Administration Subcommittee on Oversight and the Committee on Oversight and Accountability Subcommittee on Cybersecurity, Information Technology, and Government Innovation held a joint hearing on "Data Breach at the D.C. Health Exchange." On Wednesday (April 19), the Subcommittees held a joint hearing on the D.C. Health Exchange Data Breach, during which members learned the breach may have included personal data of enrollees. Mila Kofman, executive director of the DC Health Benefit Exchange Authority, told committee members that an investigation is still ongoing, but the breach was connected to a "misconfigured server" that had been in use since 2018.

  • More information available here.

Other hearings included:

Oversight and Accountability Committee's Coronavirus Pandemic Select Subcommittee hearing on "Investigating the Origins of COVID-19, Part 2: China and the Available Intelligence."

  • More information available here.

Veterans' Affairs Committee's Health Subcommittee hearing on "Combatting a Crisis: Providing Veterans Access to Life-saving Substance Abuse Disorder Treatment."

  • More information available here.

Reports, Studies, and Journals

Health Affairs: Widespread Third-Party Tracking On Hospital Websites Poses Privacy Risks For Patients And Legal Liability For Hospitals. The study found that 99% of U.S. hospitals used online data trackers in 2021 that shared visitor's information to third-party companies — such as technology companies, data brokers, and private equity firms — when they visited the hospital's website.

Congressional Budget Office: Budgetary Effects of Policies to Modify or Eliminate Medicaid's Institutions for Mental Diseases Exclusion. In the report, CBO estimates the cost of eliminating the Institutions for Mental Diseases (IMD) exclusion for some or all behavioral health treatments would cost the federal government between $7.7 billion and $38.4 billion. Under the IMD exclusion the federal government does not have to match state expenditures for certain inpatient facility services.

HHS' Assistant Secretary for Planning and Evaluation: Medicaid Enrollees Who are Employed: Implications for Unwinding the Medicaid Continuous Enrollment Provision. The report estimates more than 4 million people who lose Medicaid coverage as part of the redetermination process could move over to employer-sponsored coverage, and encourages employers to engage with workers to prevent coverage gaps.

CMS Office of Minority Health: The Disparities in Health Care by Race, Ethnicity, and Sex. The report highlights the quality of care for those enrolled in Medicare Advantage and includes national-level race, ethnicity, and sex disparities for 2022. Among other things, the report found Black, Hispanic, and particularly American Indian and Alaskan Native enrollees experienced lower than average clinical care quality for across many of the examined measures.

Turquoise Health. Price Transparency Impact Report — 2023. According to the report, about 84% of hospitals had posted a machine-readable file containing some rate information by the end of first-quarter 2023, up from 65% the previous quarter. Though compliance rates varied by the type of data. For example, 73.6% of hospitals had published negotiated rates. The report also found 183 payers representing over 95% of the U.S. commercially insured population had published machine-readable files of their in-network negotiated rates and out-of-network allowed amounts, up from 68 in July 2022.


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