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June 17, 2024

This Week in Health Policy for June 17

This Week (June 17 - 21)

The House is in recess this week while the Senate is in session. Other health care hearings are expected but not yet noticed.

The Senate Finance Committee will hold a hearing on “Work and Social Security Disability Benefits: Addressing Challenges and Creating Opportunities.”

  • Date: Tuesday, June 18 at 10am ET
  • More information available here.

Last Week (June 10 - 14)

Health Care Highlights  

CMS to recalculate MA star ratings and bonus payments. On Thursday (June 13), the Centers for Medicare and Medicaid Services (CMS) announced it is recalculating 2024 star ratings for 2025 quality bonus payment purposes for Medicare Advantage (MA) plans, following a court ruling last week that the agency had violated the Administrative Procedure Act when it modified how star ratings were calculated. MA contractors can view their updated 2024 ratings in the Health Plan Management System (HPMS); CMS issued recalculations only for contracts where recalculations were beneficial (i.e., resulted in higher Quality Bonus Payment (QBP) ratings than previous assigned). MA contractors with increases in their QBP ratings will also have a time-limited opportunity to resubmit Contract Year 2025 bids, which are due by June 28. The change is expected to result in hundreds of millions in additional bonus payments to MA plans. To view the full guidance, see attached: CMS Guidance on Updated 2025 QBP ratings.

CMMI provides status update on Medicaid redeterminations. On Thursday (June 13), CMS released a slide deck that showed nine states and the District of Columbia will require additional time to complete their Medicaid redetermination processes. States previously had until June to complete their review of Medicaid beneficiaries’ eligibility. CMS said it expects to provide a more detailed analysis of state unwinding practices in coming months.

HRSA awards grants to support rural medical residencies. On Thursday (June 13), the Health Resources and Services Administration (HRSA) awarded more than $11 million to 15 organizations to bolster the health care workforce in rural areas. The funds will support accreditation costs, curriculum development, faculty and resident recruitment and retention, and more, and includes the nation’s first obstetrics and gynecology rural track program.

Supreme Court upholds FDA’s mifepristone guidance. On Thursday (June 13), the Supreme Court unanimously ruled that plaintiffs challenging the Food and Drug Administration’s (FDA) regulation of the abortion pill mifepristone lacked standing to bring the case. The decision reverses an appeals court order and maintains FDA protocols allowing mifepristone to be prescribed via telehealth and delivered through mail order. 

Supreme Court takes up new DSH payment case. On Monday (June 10), the Supreme Court said it will consider a new case on how CMS can calculate Medicare disproportionate share hospital (DSH) payments. The latest case, Advocate Christ Medical, et al. v. Becerra, alleges that CMS is not following the standard determined in the 2022 Supreme Court DSH case and focuses on how HHS counts patients who receive Supplemental Security Income benefits in its DSH calculations.

Sen. Marshall reintroduces bill to create an electronic MA prior authorization process. On Wednesday (June 12), Sen. Roger Marshall (R-KS) reintroduced the Improving Seniors' Timely Access to Care Act, which would require Medicare Advantage plans to comply with enhanced transparency reporting requirements beginning in January 2026 and implement electronic prior authorization processes beginning in January 2027. The bill unanimously passed the House last Congress but stalled due to its estimated $16 billion Congressional Budget Office score. However, recent rulemaking and tweaks to the legislation have reduced the bill’s high cost, increasing the chances for passage.

Biden administration proposes rule to remove medical debt from credit reports. On Tuesday (June 11), the Consumer Finance Protection Bureau issued a proposed rule that would prohibit credit reporting agencies from considering medical debt when calculating credit scores. Under the proposed rule, lenders, including health care providers, also would be prohibited from sharing medical debt to determine loan eligibility. CFRB is accepting public comment on the rule until August 12.

Hearings, Markups, and Other Committee Activity

House Energy & Commerce Committee held a hearing on “Checking-In on CMMI: Assessing the Transition to Value-Based Care.” On Thursday (June 13), the Committee held a hearing during which it heard testimony from Deputy Administrator and Director of the CMS Innovation Center (CMMI) Liz Fowler. During the hearing, discussion centered on how to ensure affordable access to quality care with several members raising concern that the Congressional Budget Office found CMMI cost the government $5.4 billion over the past 10 years rather than saving money. In addition, several lawmakers raised concerns that CMMI was not incorporating feedback from the Physician-Focused Payment Model Technical Advisory Committee (PTAC) into models.

  • More information available here.

House Budget Committee held a hearing on “Medicare and Social Security: Examining Solvency and Impacts to the Federal Budget.” On Thursday (June 13), the Committee held an oversight hearing with the chief actuaries from CMS and the Social Security Administration. During the hearing, lawmakers discussed their opposing approaches to looming insolvency, how beneficiaries would be negatively impacted if Congress does not act, and the need to reach a bipartisan compromise to avoid those outcomes.

  • More information available here.

House Energy & Commerce Committee held a markup of health care legislation. On Wednesday (June 12), the House Energy and Commerce Committee unanimously advanced 13 bills to extend Medicare beneficiaries’ access to certain telehealth services partially paid for by a pharmacy benefit manager (PBM) provision to ban spread pricing in Medicaid, as well as bills to support living organ donors; support research into women’s health, lung cancer and preventive services; authorize research into stillborn births; improve Medicare and Medicaid program integrity; and more.

  • More information available here.

Senate Judiciary Subcommittee on Federal Courts, Oversight, Agency Action, and Federal Rights held a hearing on “Crossing the Line: Abortion Bans and Interstate Travel for Care After Dobbs.” On Wednesday (June 12), the Subcommittee held a hearing on access to abortion care in the wake of the Supreme Court’s Dobbs decision. Lawmakers heard from two panels, the first featuring Sen. Catherine Cortez Masto (D-NV) and Rep Claudia Tenney (R-NY) and second panel featuring a data scientist focused on reproductive care access, women’s reproductive rights advocacy group, a patient, an OB-GYN, and an academic. During the hearing, Democrats spoke about the need to pass the Freedom to Travel for Health Care Act and other bills to support women and providers in states with reproductive care limits, while Republicans spoke about the importance of states setting abortion standards.

  • More information available here.

Senate Judiciary Committee held a hearing on “Combatting the Youth Vaping Epidemic by Enhancing Enforcement Against Illegal E-Cigarettes.” On Wednesday (June 12), the Committee held a hearing on youth vaping, hearing from two panels of witnesses. The first panel featured representatives from the FDA and the Department of Justice, while the second panel featured representatives from the vaping and tobacco industry, tobacco-free kids advocacy groups, youth, and nicotine and tobacco prevention providers. During the hearing, members from both parties criticized the FDA’s approach to the illegal vaping market.

  • More information available here.

House Education and the Workforce Committee held a mark up of legislation. On Thursday (June 13), the House Education and the Workforce Committee advanced several bills including a bill (H.R. 618) that would update the Federal Employees’ Compensation Act (FECA) to authorize physician assistants and nurse practitioners to certify and oversee health care delivery for federal workers with injuries or illnesses that occur on the job, consistent with their state scope of practice. The measure, which passed the House last Congress, advanced out of the committee with unanimous support.

  • More information available here.

House Rules Committee excludes BIOSECURE Act from National Defense Authorization Act (NDAA). On Tuesday (June 11), the Committee compiled a list of 350 amendments to be considered with the NDAA that does not include the BIOSECURE Act. While the bill continues to have bipartisan and bicameral support, the decision limits the opportunity for passage this year. In response to the decision, the office of Rep. Brad Wenstrup (R-OH), who introduced the amendment, issued a statement, saying, "While we are disappointed the BIOSECURE amendment was not made in order, we understand the need to focus this year's NDAA on servicemembers to greatly improve their quality of life with long overdue pay raises, better housing conditions, and more. … We look forward to the BIOSECURE bill, which passed out of House Oversight 40-1, coming to the floor sometime soon, and we hope the Senate will do its part in moving the bill as well."

  • More information available here.

House Appropriations Agriculture, Rural Development, Food and Drug Administration Subcommittee held a markup of Fiscal Year 2025 Agriculture, Rural Development, Food and Drug Administration, and Related Agencies Bill. On Tuesday (June 11), the Subcommittee advanced the FY 2025 appropriations bill that funds the FDA. The bill allocates $6.75 billion for FDA in FY 2025, a roughly 1% cut from the FY 2024 budget.

  • More information available here.

Reports, Studies, and Journals

Health Affairs: National Health Expenditure Projections, 2023–32: Payer Trends Diverge As Pandemic-Related Policies Fade. The annual projections from CMS actuaries estimates national health spending grew 7.5% in 2023, driven in part by insurance growth. CMS projected spending will rise by 5.6% over a decade, reaching $7.7 trillion by 2032, driven in part by high levels of insured patients and growing Medicare enrollment. The report also projects the Inflation Reduction Act will slow annual growth in patients’ out-of-pocket drug costs, while increasing drug costs for the Medicare program, which will be partially mitigated by lower drug prices from drug price negotiations.

Medicare Payment Advisory Commission: Report to Congress: Medicare and the Health Care Delivery System. The annual report provides recommendations to Congress on Medicare clinician payments and incentives for participating in alternative payment models, Medicare Advantage prior authorization and provider networks, the Acute Hospital Care at Home program, and more.

Medicaid and CHIP Payment and Access Commission: Report to Congress on Medicaid and CHIP. The annual report provides recommendations to Congress on ways to improve the transparency of financing the non-federal share of Medicaid and CHIP, ways to improve care coordination for dual-eligibles and federal and state priorities for demographic data collection and use.

Government Accountability Office: Recommendations for Congress: Action Can Produce Billions of Dollars in Financial and Other Benefits. The report highlights recommended actions Congress could take to generate additional savings, including requiring HHS to improve the Medicaid demonstration review process, which GAO projects could save tens of billions of dollars.

Committee for a Responsible Federal Budget: The Federal Tax Benefits for Nonprofit Hospitals. The report estimates that the federal government will lose around $260 billion in revenue due to the nonprofit hospital tax exemption from 2025--2034, and recommends policymakers reduce the tax benefit and/or enforce stricter requirements for substantial community benefit provision.

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CMS guidance on updated 2025 QBP ratings

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Contact Information

For additional information concerning this Alert, please contact:

Washington Council Ernst & Young