Alston & Bird Health Care Week in Review, July 30, 2021

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:

This week, CMS issued four FY 2022 final rules updating payments under the Medicare program. Read more about these rules and other news below.

I. Regulations, Notices & Guidance

• On July 27, 2021, the Food and Drug Administration (FDA) issued guidance entitled, Product-Specific Guidance for Olodaterol Hydrochloride; Tiotropium Bromide. The draft guidance, when finalized, will provide product-specific recommendations on, among other things, the information and data needed to demonstrate bioequivalence (BE) to support abbreviated new drug applications (ANDAs) for olodaterol hydrochloride; tiotropium bromide inhalation spray.
• On July 28, 2021, FDA issued guidance entitled, Rabies: Developing Monoclonal Antibody Cocktails for the Passive Immunization Component of Post-Exposure Prophylaxis. The purpose of this draft guidance is to help sponsors in the development of anti-rabies virus monoclonal antibody (mAb) cocktails as an alternative to anti-rabies virus immunoglobulin (RIG) as the passive immunization component of post-exposure prophylaxis (PEP) for the prevention of rabies when given immediately after contact with a rabid or possibly rabid animal.
• On July 29, 2021, the Department of Health and Human Services (HHS) issued a proposed rule entitled, Regulatory Agenda: Semiannual Regulatory Agenda. The Regulatory Flexibility Act of 1980 and Executive Order (EO) 12866 require the semiannual issuance of an inventory of rulemaking actions under development throughout the Department, offering for public review summarized information about forthcoming regulatory actions.
• On July 29, 2021, the Centers for Medicare & Medicaid Services (CMS) issued a final rule entitled, FY 2022 Hospice Wage Index and Payment Rate Update, Hospice Conditions of Participation Updates, Hospice and Home Health Quality Reporting Program Requirements. This final rule updates the hospice wage index, payment rates, and aggregate cap amount for Fiscal Year (FY) 2022. This rule makes changes to the labor shares of the hospice payment rates and finalizes clarifying regulations text changes to the election statement addendum that was implemented on October 1, 2020. In addition, this rule makes permanent selected regulatory blanket waivers that were issued to Medicare-participating hospice agencies during the COVID-19 public health emergency (PHE) and updates the hospice conditions of participation. This rule updates the Hospice Quality Reporting Program and finalizes changes beginning with the January 2022 public reporting for the Home Health Quality Reporting Program to address exceptions related to the COVID-19 PHE.
• On July 29, 2021, CMS issued a final rule entitled, FY 2022 Inpatient Psychiatric Facilities Prospective Payment System and Quality Reporting Updates for Fiscal Year Beginning October 1, 2021 (FY 2022). This final rule updates the prospective payment rates, the outlier threshold, and the wage index for Medicare inpatient hospital services provided by Inpatient Psychiatric Facilities (IPF), which include psychiatric hospitals and excluded psychiatric units of an acute care hospital or critical access hospital. This rule also updates and clarifies the IPF teaching policy with respect to IPF hospital closures and displaced residents and finalizes a technical change to one of the 2016-based IPF market basket price proxies. In addition, this final rule finalizes proposals on quality measures and reporting requirements under the Inpatient Psychiatric Facilities Quality Reporting (IPFQR) Program. This final rule does not finalize two proposals to remove quality measures. The changes finalized in this rule for the IPFQR Program are effective for IPF discharges occurring during FY 2022.
• On July 29, 2021, CMS issued a final rule entitled, Inpatient Rehabilitation Facility Prospective Payment System for Federal Fiscal Year 2022 and Updates to the IRF Quality Reporting Program; Payment for Complex Rehabilitative Wheelchairs and Related Accessories (Including Seating Systems) and Seat and Back Cushions Furnished in Connection with Such Wheelchairs. This final rule updates the prospective payment rates for inpatient rehabilitation facilities (IRFs) for FY 2022. As required by statute, this final rule includes the classification and weighting factors for the IRF prospective payment system’s case-mix groups and a description of the methodologies and data used in computing the prospective payment rates for FY 2022. This final rule also includes updates for the IRF Quality Reporting Program (QRP). In addition, CMS is finalizing a Medicare provision adopted in an interim final rule with comment period (IFC) issued on May 11, 2018 related to fee schedule adjustments for wheelchair accessories (including seating systems) and seat and back cushions furnished in connection with group 3 or higher complex rehabilitative power wheelchairs as well as changes to the regulations related to the Further Consolidated Appropriations Act, 2020 governing payment for these and other items.
• On July 29, 2021, CMS issued a final rule entitled, Prospective Payment System and Consolidated Billing for Skilled Nursing Facilities; Updates to the Quality Reporting Program and Value-Based Purchasing Program for Federal Fiscal Year 2022; and Technical Correction to Long-Term Care Facilities Physical Environment Requirements. This final rule updates the payment rates used under the prospective payment system (PPS) for skilled nursing facilities (SNFs) for FY 2022. In addition, the final rule includes a forecast error adjustment for FY 2022, updates the diagnosis code mappings used under the Patient Driven Payment Model (PDPM), rebases and revises the SNF market basket, implements a recently-enacted SNF consolidated billing exclusion along with the required proportional reduction in the SNF PPS base rates, and includes a discussion of a PDPM parity adjustment. In addition, the final rule includes updates for the SNF Quality Reporting Program (QRP) and the SNF Value-Based Purchasing (VBP) Program, including a policy to suppress the use of the SNF readmission measure for scoring and payment adjustment purposes in the FY 2022 SNF VBP Program because CMS has determined that circumstances caused by the public health emergency for COVID-19 have significantly affected the validity and reliability of the measure and resulting performance scores. CMS is also finalizing a technical correction to the physical environment requirements that Long-Term Care facilities must meet in order to participate in the Medicare and Medicaid programs.
• On July 30, 2021, FDA issued a final rule entitled, Intended Uses. This final rule amends FDA’s regulations describing the types of evidence relevant to determining whether a product is intended for use as a drug or device under the Federal Food, Drug, and Cosmetic Act (FD&C Act), the Public Health Service Act (PHS Act), and FDA’s implementing regulations, including whether a medical product that is approved, cleared, granted marketing authorization, or exempted from premarket notification is intended for a new use. This action also withdraws and replaces the portions of a final rule issued on January 9, 2017, that never became effective.
• On July 30, 2021, CMS issued a proposed rule entitled, Reassignment of Medicaid Provider Claims. This proposed rule would reinterpret the scope of the general requirement that state payments for Medicaid services under a state plan must be made directly to the individual practitioner providing services, in the case of a class of practitioners for which the Medicaid program is the primary source of revenue. Specifically, this proposal, if finalized, would explicitly authorize states to make payments to third parties to benefit individual practitioners by ensuring health and welfare benefits, training, and other benefits customary for employees, if the practitioner consents to such payments to third parties on the practitioner’s behalf.

Event Notices

• August 17, 2021: HHS announced a virtual public meeting of the Advisory Committee on Blood and Tissue Safety and Availability (ACBTSA). ACBTSA will discuss recommendations to improve the supply chain and data infrastructure that supports the blood industry, especially during public health emergencies. To facilitate this discussion, key stakeholders from across the nation and around the world will present on hemovigilance, preparedness, inventory management systems and other relevant issues.
• September 9-10, 2021: The National Institutes of Health (NIH) announced a virtual public meeting of the National Deafness and Other Communication Disorders Advisory Council (NDOCDAC). NDOCDAC will meet to review and evaluate grant applications and hear staff reports on divisional, programmatical, and special activities.
• September 14, 2021: NIH announced a virtual public meeting of the National Advisory Council for Biomedical Imaging and Bioengineering (NACBIB). NACBIB will hear a report from the Institute Director and other Institute Staff and review and evaluate grant applications.
• September 22, 2021: CMS announced a virtual public meeting of the Medicare Evidence Development & Coverage Advisory Committee (MEDCAC). The MEDCAC panel will examine relevant health outcomes in studies for cerebrovascular disease treatment with a particular focus on new technologies of interest to CMS. It will also examine the growing challenges associated with the decreased level of evidence of certain new and innovative technologies. MEDCAC panel members will advise CMS about the ideal health outcomes in research studies of cerebrovascular disease treatment technologies, appropriate measurement instruments and follow-up durations to help to provide clarity and transparency of National Coverage Analyses (NCAs).
• September 23-24, 2021: NIH announced a virtual public workshop entitled, Exploring the Science Surrounding the Safe Use of Bioactive Ingredients in Infant Formula: Considerations for an Assessment Framework. The workshop focuses on the functional state-of-the-science of biologically active human milk components and analogs and the implications for safety assessments when used in infant formula.
• October 7, 2021: FDA announced a public advisory committee meeting of the Antimicrobial Drugs Advisory Committee. The general function of the committee is to provide advice and recommendations to FDA on regulatory issues.

II. Congressional Hearings

U.S. House of Representatives

• On July 29, 2021, the House Committee on Energy and Commerce Subcommittee on Health held a hearing entitled, The Path Forward: Advancing Treatments and Cures for Neurodegenerative Diseases. Witnesses present included: Patrizia Cavazzoni, M.D., Director, Center for Drug Evaluation and Research, U.S. Food and Drug Administration (FDA); Richard J. Hodes, M.D., Director, National Institute on Aging (NIA), National Institute of Health (NIH); Walter J. Koroshetz, M.D., Director, National Institute of Neurological Disorders and Stroke (NINDS), NIH; Jinsy Andrews, M.D., Director of Neuromuscular Clinical Trials, Neurological Institute of New York, and Associate Professor of Neurology, Columbia University Vagelos College of Physicians and Surgeons; Kala Booth, Huntington's Disease Caregiver and Patient, Merit Cudkowicz, M.D., Director, Sean M. Healy and AMG Center for ALS, Chief, Neurology Department, Massachusetts General Hospital, and Julianne Dorn Professor of Neurology, Harvard Medical School; Cartier Esham, Ph.D., Executive Vice President, Emerging Companies, and Senior Vice President, Science and Regulatory Affairs, Biotechnology Innovation Organization (BIO); Yvonne Latty, Caregiver; and Brian Wallach, Co-Founder, I AM ALS.

U.S. Senate

• On July 27, 2021, the Senate Committee on Health, Education, Labor, and Pensions held a hearing entitled, The Path Forward: Building on Lessons Learned from the COVID-19 Pandemic. Witnesses present included: Les Becker, Deputy Secretary of Innovation, Washington State Department of Health; Phyllis Arthur, Vice President, Infectious Diseases and Diagnostics Policy, BIO; David Janz, M.D., Director, Medical Critical Care Services, University Medical Center New Orleans; and Anita Cicero, Deputy Director, Center for Health Security, Johns Hopkins Bloomberg School of Public Health.

III. Reports, Studies & Analyses

• On July 28, 2021, the Government Accountability Office (GAO) published a report entitled, Medicare Advantage: Beneficiary Disenrollments to Fee-for-Service in Last Year of Life Increase Medicare Spending. In this report, GAO examined (1) disenrollments from Medicare Advantage (MA) to join fee-for-service (FFS) by beneficiaries in the last year of life, and CMS's associated monitoring; and (2) the costs of such disenrollments to Medicare. The report found that beneficiaries in the last year of life disproportionately disenrolled from MA to enroll in FFS, indicating possible issues with their care. Shifting end-of-life costs to FFS increased Medicare spending by hundreds of millions of dollars.
• On July 30, 2021, the Kaiser Family Foundation (KFF) published an issue brief entitled, Racial Disparities in COVID-19 Vaccinations among Children. To better understand potential racial/ethnic disparities in COVID-19 vaccination among children, KFF assessed which states are reporting data on COVID-19 vaccinations for children by race/ethnicity and, where data were available, calculated vaccination rates among children by race/ethnicity.
• On July 30, 2021, KFF published an analysis entitled, COVID-19 Vaccine Breakthrough Cases: Data from the States. KFF reviewed the websites and other official state sources for all 50 states and D.C. to see which are providing data on COVID-19 breakthrough cases, hospitalizations and deaths, how regularly, and what those data may tell us.
• On July 30, 2021, Alston & Bird published a new edition of Healthy Byte, offering insight on the new CPT codes for remote therapeutic monitoring (RTM) included in the CY 2022 Medicare Physician Fee Schedule proposed rule.

IV. Other Health Policy News

• On July 26, 2021, HHS, in partnership with the Department of Justice (DOJ), published guidance on how "long COVID" can be a disability under the ADA, Section 504 of the Rehabilitation Act, and Section 1557 of the Affordable Care Act. This guidance explains that long COVID can be a disability under the ADA, Section 504 of the Rehabilitation Act of 1973, and Section 1557 of the Affordable Care Act, and explains how these laws may apply. Each of these federal laws protects people with disabilities from discrimination. This guidance also provides resources for additional information and best practices. More information on the guidance can be found here.
• On July 27, 2021, HHS provided $121 million in American Rescue Plan Funds to support the work of trusted community-based efforts to increase vaccinations in underserved communities. The funding will go to community-based organizations across the country that are working in their communities to build vaccine confidence, share factual information about vaccines, and answer people's questions about getting vaccinated. More information about the funding decision can be found here.
• On July 29, 2021, HHS, through the Substance Abuse and Mental Health Services Administration (SAMHSA), awarded 100 grants totaling $250 million, including $77 million from the American Rescue Plan, to increase access to facilities throughout the nation that provide community-based support for Americans in need of substance use disorder and mental health treatment services. More information about the funding decision can be found here.

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