Alston & Bird Health Care Week in Review, February 14, 2020

Below is Alston & Bird’s Health Care Week in Review, which provides a synopsis of the latest news in healthcare regulations, notices, and guidance; federal legislation and congressional committee action; reports, studies, and analyses; and other health policy news.

Week in Review Highlight of the Week:

On Monday, February 10, the White House released President Trump’s Fiscal Year 2021 budget. Read more about this proposal and other news below.

I. Regulations, Notices, & Guidance

• On February 12, 2020, the Food and Drug Administration (FDA) issued guidance entitled, Peripheral Vascular Atherectomy Devices—Premarket Notification Submissions. Atherectomy is an interventional procedure performed to remove atherosclerotic plaque from diseased arteries. FDA has developed this guidance for members of industry who submit and FDA staff who review premarket submissions for atherectomy devices used in the peripheral vasculature. This guidance is intended to provide recommendations for information to include in premarket notifications (510(k)) for peripheral vascular atherectomy devices (e.g., descriptive characteristics, labeling, biocompatibility, sterility, non-clinical, animal, and clinical performance testing).
• On February 12, 2020, the National Institutes of Health (NIH) issued a Request for Information (RFI) entitled, Inviting Comments and Suggestions on a Framework for the NIH-Wide Strategic Plan for FYs 2021-2025. This RFI is intended to gather broad public input to assist the NIH in developing the NIH-Wide Strategic Plan for Fiscal Years (FYs) 2021-2025. NIH invites input from stakeholders throughout the scientific research, advocacy, and clinical practice communities, as well as the general public, regarding the proposed framework for the FY 2021-2025 NIH-Wide Strategic Plan. Organizations are strongly encouraged to submit a single response that reflects the views of their organization and their membership as a whole.
• On February 12, 2020, NIH issued an RFI entitled, Stakeholder Input on Opportunities for Increased Collaboration to Advance Prevention Research. This RFI is intended to identify opportunities to foster and engage in partnerships and dialogue with stakeholders to advance prevention research. The Office of Disease Prevention (ODP) hopes this will help ODP determine areas where they can collaboratively advance prevention research priorities, training opportunities, and better meet the needs of stakeholders. The ODP invites input from researchers in academia and industry, health care professionals, patient advocates and advocacy organizations, scientific or professional organizations, federal agencies, and other interested members of the public. Organizations are strongly encouraged to submit a single response that reflects the views of the organization and membership as a whole.
• On February 13, 2020, FDA issued an extension of the comment period for guidance entitled, Bridging for Drug-Device and Biologic-Device Combination Products. This guidance provides recommendations to industry and FDA staff on how to approach bridging in new drug applications (NDAs) or biologics license applications (BLAs) for drug device and biologic-device single entity or co-packaged combination products.
• On February 14, 2020, the Centers for Medicare & Medicaid Services (CMS) issued a final rule entitled, Medicare Secondary Payer and Certain Civil Money Penalties. This proposed rule would specify how and when CMS must calculate and impose civil money penalties (CMPs) when group health plan (GHP) and non-group health plan (NGHP) responsible reporting entities (RREs) fail to meet their Medicare Secondary Payer (MSP) reporting obligations in any one or more of the following ways: when RREs fail to register and report as required by MSP reporting requirements; when RREs report as required, but report in a manner that exceeds error tolerances established by the Secretary of the Department of Health and Human Services (the Secretary); when RREs contradict the information the RREs have reported when CMS attempts to recover its payments from these RREs. This proposed rule would also establish CMP amounts and circumstances under which CMPs would and would not be imposed.
• On February 14, 2020, CMS issued a final rule entitled, Medicaid Program: Preadmission Screening and Resident Review. This proposed rule would modernize the requirements for Preadmission Screening and Resident Review (PASRR), currently referred to in regulation as Preadmission Screening and Annual Resident Review, by incorporating statutory changes, reflecting updates to diagnostic criteria for mental illness and intellectual disability, reducing duplicative requirements and other administrative burdens on State PASRR programs, and making the process more streamlined and person-centered.

Event Notices

• February 24, 2020: FDA announced a public meeting entitled, Rare Disease Day 2020: Supporting the Future of Rare Disease Product Development. The goal of this meeting is to obtain stakeholders' perspectives on challenges and solutions in rare disease product development and identify commonalities that can support product development across a variety of rare diseases.
• February 26, 2020: FDA announced a public meeting entitled, Oncologic Drugs Advisory Committee. During the morning session, the committee will discuss new drug application 212578 for padeliporfin di-potassium powder for solution for injection, submitted by STEBA Biotech, S.A. The proposed indication (use) for this product is for the treatment of patients with localized prostate cancer. During the afternoon session, the committee will discuss supplemental biologics license application 125477/S-034, for CYRAMZA (ramucirumab) injection for intravenous use, submitted by Eli Lilly and Company. The proposed indication (use) for this product is in combination with erlotinib, for first-line treatment of patients with metastatic non-small cell lung cancer whose tumors have epidermal growth factor receptor exon 19 deletions or exon 21 (L858R) substitution mutations.
• March 2-4, 2020: The Health Resources and Services Administration (HRSA) announced a public meeting entitled, National Advisory Committee on Rural Health and Human Services (NACRHHS). NACRHHS provides advice and recommendations to the Secretary of the Department of Health and Human Services (HHS) on policy, program development, and other matters of significance concerning both rural health and rural human services.
• March 4, 2020: FDA announced a public meeting entitled, Vaccines and Related Biological Products Advisory Committee. The committee will discuss and make recommendations on the selection of strains to be included in the influenza virus vaccines for the 2020 to 2021 influenza season. Also, on March 4, 2020, under Topic II, the committee will meet in open session to hear an overview of the research programs in the Laboratory of Respiratory and Special Pathogens, Division of Bacterial, Parasitic, and Allergenic Products, Office of Vaccines Research and Review, CBER.
• March 9, 2020: FDA and the Federal Trade Commission (FTC) announced a public workshop entitled, Workshop on a Competitive Marketplace for Biosimilars. The purpose of the public workshop is to discuss FDA and FTC's collaborative efforts to support appropriate adoption of biosimilars, discourage false or misleading communications about biosimilars, and deter anticompetitive behaviors in the biologic product marketplace.
• March 10, 2020: FDA announced a public meeting entitled, Patient-Focused Drug Development for Stimulant Use Disorder. The purpose of the meeting is to allow FDA to obtain stakeholder perspectives on the impact of stimulant use disorder and views on treatment approaches for stimulant use disorder.

II. Congressional Hearings

House of Representatives

• On February 11, 2020, the House Committee on Education and Labor held a markup of H.R. 5800, the Ban Surprise Billing Act. The bill passed the Committee by a vote of 32-13 and was favorably forwarded to the House.
• On February 11, 2020, the House Committee on Education and Labor Subcommittee on Workforce Protections held a hearing entitled, Balancing Work, Health, and Family: The Case for Expanding the Family and Medical Leave Act. Witnesses present included: Mrs. Sydney Batch, J.D., M.S.W., Representative, North Carolina House of Representatives; Mr. Anthony Sandkamp, Owner, Sandkamp Woodworks LLC; Ms. Rachel Greszler, Research Fellow in Economics, Budgets, and Entitlements, the Heritage Foundation; and Ms. Elisabeth Jacobs, Ph.D., Senior Fellow, Urban Institute.
• On February 12, 2020, the Senate Committee on Aging held a hearing entitled, There’s No Place Like Home: Home Health Care in Rural America. Witnesses present included: LeighAnn Howard, RN, DNP, CHFN-K, Director, Home Health and Specialty Programs, Northern Light Home Care and Hospice; William Dombi, President, National Association for Home Care and Hospice; Warren Hebert, DNP, RN, CAE, FAAN, Assistant Professor and CEO, Loyola University and Home Health Care Association of Louisiana; and Francis Adams, Home Care Worker.
• On February 12, 2020, the House Committee on Ways and Means held a markup of three health bills. The legislation included: H.R. 5821, the HOSPICE Act; H.R. 5825, the Transparency in Health Care Investments Act of 2020; and H.R. 5826, the Consumer Protections Against Surprise Medical Bills Act. All three bills passed the Committee by voice vote and were favorably forwarded to the House.

Senate

• On February 11, 2020, the Senate Committee on the Judiciary held a hearing entitled, The Infant Patient: Ensuring Appropriate Medical Care for Children Born Alive. Witnesses present included: Dr. Robin Pierucci, M.D., M.A., Clinical Neonatologist, Neonatal Intensive Care Unit, Director; Ms. Fatima Goss Graves, President and CEO, National Women’s Law Center; Ms. Patrina Mosley, Director of Life, Culture, and Women’s Advocacy, Family Research Council; Ms. Erika Christensen, Patient Advocate; and Ms. Jill Stanek, R.N., National Campaign Chair, Susan B. Anthony List.
• On February 13, 2020, the Senate Committee on Finance held a hearing on the President’s Fiscal Year 2021 Budget. Witnesses present included: The Honorable Alex M. Azar II, Secretary, United States Department of Health and Human Services.

III. Reports, Studies, & Analyses

• On February 12, 2020, the Government Accountability Office (GAO) published a report entitled, Medicaid Eligibility: Accuracy of Determinations and Efforts to Recoup Federal Funds Due to Errors. The GAO states that the Patient Protection and Affordable Care Act (ACA) made significant changes to Medicaid eligibility rules beginning in 2014, including new ways of calculating income and new requirements related to electronically verifying applicants' information. However, little is known about the accuracy of states' Medicaid eligibility determinations since these changes were implemented. As a result, GAO was asked to review Medicaid eligibility determinations. This report describes, among other things, what is known about the accuracy of Medicaid eligibility determinations, and CMS' efforts to recoup funds related to eligibility errors.
• On February 13, 2020, the White House Council of Economic Advisers published a report entitled, Funding the Global Benefits to Biopharmaceutical Innovation. The report examines how the costs and benefits of medical innovation are distributed across developed nations, making the argument that coordinated drug-purchasing efforts in other countries, often by government-run programs, result in lower drug costs compared to the U.S. The report describes the practice as “free-riding.” More specifically, the report claims that lower drug spending globally erodes the resources available for researchers to develop new drugs. The analysis shows that other industrialized countries spend much less than the U.S. on drugs and argues that a truly free market would see them all pay more—rather than the U.S. paying less.
• On February 13, 2020, the Center for American Progress (CAP) published a report entitled, State Policy Options to Reduce Prescription Drug Spending. This report discusses policy options available to states to lower their drug spending. First, it considers two options targeted at state Medicaid programs: negotiating supplemental rebates and enhancing drug utilization review. The report then discusses reforms that seek to improve a state’s negotiating power, including consolidating purchasing across state programs or with other states; establishing a common formulary across state programs; consolidating procurement of pharmacy benefit manager (PBM) services; negotiating rebates with PBMs; and implementing subscription-based purchasing. Finally, this report discusses reforms to lower the list prices of prescription drugs, including by establishing a prescription drug affordability review board; reference pricing drugs; maximizing participation in the 340B Drug Pricing Program; promoting the use of generics; reducing the cost of physician-administered drugs; and importing drugs from Canada.

IV. Other Health Policy News

• On February 10, 2020, the White House released President Donald Trump’s Fiscal Year 2021 (FY21) budget, calling for deep cuts to social programs but increases in defense and entitlement spending that would push the gross federal debt above $30 trillion over the next decade. Overall, the HHS Budget-in-Brief describes a total of $94.5 billion in discretionary budget authority for HHS—around a 10 percent reduction from the enacted 2020 level—and $1.3 trillion in mandatory funding for the Department for FY 2021. According to HHS, this budget reflects the Department’s commitment to reforming the health care system and reducing drug prices. Of note, the Budget calls for legislative and administrative proposals that are estimated to result in significant reductions in Medicare and Medicaid spending. For Medicare, the combined proposals are estimated to reduce spending by almost $900 billion; for Medicaid, nearly $950 billion. Similar to the FY 2020 HHS Budget, this year’s Budget proposes to eliminate the Agency for Healthcare Research and Quality (AHRQ), discontinue the Community Services Block Grant, and eliminate or reduce funding for certain HRSA workforce programs. The Budget would also implement provisions of the SUPPORT for Patients and Communities Act, implement changes in support of the Ending the HIV Epidemic Initiative, expand Medicare site neutral payment policies, and reshape strategies intended to reduce drug-related costs. The FY 2021 Budget also includes new proposals related to kidney disease care.
• On February 13, 2020, CMS announced that it has developed a new code for the 2019-Novel Coronavirus lab tests. Specifically, CMS developed a new Healthcare Common Procedure Coding System (HCPCS) code for providers and laboratories to test patients for SARS-CoV-2. This code will allow those labs conducting the tests to bill for the specific test instead of using an unspecified code, which means better tracking of the public health response for this particular strain of the coronavirus to help protect people from the spread of this infectious disease. Read more about the new code here.
• On February 14, 2020, a federal appeals court struck down the Trump Administration’s approval of Medicaid work requirements in Arkansas. The U.S. Court of Appeals for the D.C. Circuit affirmed a lower court ruling that the approval of the work requirements was "arbitrary and capricious." The court found that the Trump administration disregarded the statutory purpose of Medicaid—to provide health coverage—and did not adequately account for the coverage losses that would result from the work requirements. Read more about the decision here. 

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