Health Care Week in Review: CMS and HHS Issue Proposed Rules

Below is Alston & Bird’s Health Care Week in Review, which provides a synopsis of the latest news in health care 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 released its Medicare Advantage and Medicare Part D proposed rule, and HHS released a proposed rule on its benefit and payment parameters for 2024. Read more about these actions and other news below.

I. Regulations, Notices & Guidance

• On December 13, 2022, HHS issued a notice of proposed rulemaking (NPRM) entitled, Medications for the Treatment of Opioid Use Disorder. This proposed rule would specifically make permanent flexibilities that were granted in early 2020 due to the COVID-19 pandemic. One flexibility allowed patients deemed stable by their physician to take home either a 14-day or 28-day supply of methadone, which according to SAMHSA has been shown to make patients more likely to remain in treatment and less likely to use illicit opioids. The proposed rule would also make permanent updates to opioid treatment program (OTP) standards, which were included in the other major flexibility granted by SAMHSA during the pandemic. Specific provisions include expanding the definition of an OTP treatment practitioner to include any provider who is appropriately licensed to dispense and/or prescribe approved medications, as well as implementing evidence-based delivery models of care such as split dosing, telehealth, and harm reduction activities. Additionally, the proposed rule would update OTP admission criteria by eliminating the one-year requirement for opioid addiction before admission to an OTP, and instead replacing it with physician consideration of each individual’s problematic patterns of opioid use. Finally, SAMHSA is proposing to eliminate the requirement that practitioners who have a waiver to prescribe buprenorphine for up to 275 patients must provide reports to SAMHSA on an annual basis. The NPRM solicits public comment on its proposal to modify its regulations regarding medications for the treatment of opioid use disorder. Comments are due February 14, 2023.
• On December 13, 2022, the Centers for Medicare & Medicaid Services (CMS) issued a notice entitled, Membership list and Meeting dates for the Ground Ambulance and Patient Billing (GAPB) Advisory Committee, January 17-18, 2023. This notice announces the Membership of the GAPB Advisory Committee and a public meeting of the Committee on January 17 and 18, 2023. The GAPB Advisory Committee will make recommendations with respect to disclosure of charges and fees for ground ambulance services and insurance coverage, consumer protection and enforcement authorities of the Departments of Labor (DOL), HHS, and the Treasury and relevant states, and the prevention of balance billing to consumers. The recommendations shall address options, best practices, and identified standards to prevent instances of balance billing; steps that can be taken by state legislatures, state insurance regulators, state attorneys general, and other state officials as appropriate, consistent with current legal authorities regarding consumer protection; and legislative options for Congress to prevent balance billing.
• On December 14, 2022, the Food and Drug Administration (FDA) issued draft guidance entitled, Pulmonary Tuberculosis: Developing Drugs for Treatment. The purpose of this draft guidance is to assist sponsors in the clinical development of new antibacterial drugs for the treatment of pulmonary tuberculosis (TB). This draft guidance does not address the development of drugs for latent TB infection or for extrapulmonary TB. This draft guidance revises and replaces the draft guidance for industry of the same name published on November 6, 2013.
• On December 14, 2022, CMS issued a proposed rule entitled, Medicare Program; Contract Year 2024 Policy and Technical Changes to the Medicare Advantage Program, Medicare Prescription Drug Benefit Program, Medicare Cost Plan Program, Medicare Parts A, B, C, and D Overpayment Provisions of the Affordable Care Act and Programs of All-Inclusive Care for the Elderly; Health Information Technology Standards and Implementation Specifications. This proposed rule would revise the Medicare Advantage (Part C), Medicare Prescription Drug Benefit (Part D), Medicare cost plan, and Programs of All-Inclusive Care for the Elderly (PACE) regulations to implement changes related to Star Ratings, medication therapy management, marketing and communications, health equity, provider directories, coverage criteria, prior authorization, passive enrollment, network adequacy, identification of overpayments, formulary changes, and other programmatic areas. This proposed rule would also codify regulations implementing section 118 of Division CC of the Consolidated Appropriations Act, 2021, section 11404 of the Inflation Reduction Act, and includes a large number of provisions that would codify existing sub-regulatory guidance in the Part C, Part D, and PACE programs. This proposed rule would also amend the existing regulations for Medicare Parts A, B, C, and D regarding the standard for an identified overpayment.
• On December 14, 2022, HHS issued a proposed rule entitled, Patient Protection and Affordable Care Act, HHS Notice of Benefit and Payment Parameters for 2024. This proposed rule includes proposed payment parameters and provisions related to the HHS-operated risk adjustment and risk adjustment data validation programs, as well as proposed 2024 user fee rates for issuers offering qualified health plans (QHPs) through Federally Facilitated Exchanges (FFEs) and State-based Exchanges on the Federal platform (SBE-FPs). This proposed rule also proposes requirements related to updating standardized plan options and reducing plan choice overload; re-enrollment hierarchy; plan and plan variation marketing name requirements for QHPs; essential community providers (ECPs) and network adequacy; failure to file and reconcile; special enrollment periods (SEPs); the annual household income verification; the deadline for QHP issuers to report enrollment and payment inaccuracies; requirements related to the State Exchange improper payment measurement program; and requirements for agents, brokers, and web-brokers assisting FFE and SBE-FP consumers.
• On December 14, 2022, FDA issued final guidance entitled, Failure to Respond to an ANDA Complete Response Letter Within the Regulatory Timeframe Guidance for Industry: Guidance for Industry. This guidance is intended to assist applicants of abbreviated new drug applications (ANDAs), which were submitted under section 505(j) of the Federal Food, Drug, and Cosmetic Act (FD&C Act) (21 U.S.C. 355(j)), in responding to complete response letters (CRLs) from FDA. As described in regulation, ANDA applicants are required to take action after receiving a CRL. The guidance revises the guidance of the same title issued in July 2022. This revision is being issued to incorporate the performance goals outlined in the Generic Drug User Fee Amendments Reauthorization Performance Goals and Program Enhancements Fiscal Years 2023-2027 (GDUFA III commitment letter). This guidance provides information and recommendations regarding potential courses of action for an ANDA applicant after issuance of a CRL, as well as the actions that FDA may take if the applicant fails to respond to that CRL.
• On December 15, 2022, FDA issued draft guidance entitled, Circumstances that Constitute Delaying, Denying, Limiting, or Refusing a Drug or Device Inspection. The FDA Reauthorization Act of 2017 (FDARA) amended the FD&C Act so that, as is the case with a drug, a device is deemed to be adulterated if the owner, operator, or agent of the factory, warehouse, or establishment at which the device is manufactured, processed, packed, or held delays, denies, or limits an FDA inspection. This draft guidance describes, for both drugs and now devices, the types of behaviors (actions, inactions, and circumstances) that the FDA considers to constitute delaying, denying, or limiting inspection, or refusing to permit entry or inspection. Once finalized, this draft guidance is intended to supersede the October 2014 FDA final guidance for industry entitled, “Circumstances that Constitute Delaying, Denying, Limiting, or Refusing a Drug Inspection.” However, until this draft guidance is finalized, the October 2014 FDA guidance remains in effect until it is withdrawn and will continue to reflect FDA’s current thinking on this issue. FDA is particularly interested in comments on the inclusion of devices to the October 2014 guidance.
• On December 15, 2022, FDA issued final guidance entitled, Hypertension Indication: Drug Labeling for Cardiovascular Outcome Claims. This guidance is intended to assist applicants in developing labeling for cardiovascular outcome claims for drugs that are indicated to treat hypertension. With few exceptions, current labeling for antihypertensive drugs includes only the information that these drugs are indicated to reduce blood pressure; the labeling does not include information on the clinical benefits related to cardiovascular outcomes expected from such blood pressure reduction.
• On December 15, 2022, HHS issued a proposed rule entitled, Administrative Simplification: Adoption of Standards for Health Care Attachments Transactions and Electronic Signatures, and Modification to Referral Certification and Authorization Transaction Standard. This rule would implement requirements of the Administrative Simplification subtitle of the Health Insurance Portability and Accountability Act of 1996 (HIPAA) and the Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act of 2010, enacted on March 30, 2010—collectively, the Affordable Care Act. Specifically, this proposed rule would adopt standards for “health care attachments” transactions, which would support both health care claims and prior authorization transactions, and a standard for electronic signatures to be used in conjunction with health care attachments transactions. To better support the use of the proposed standards for attachments transactions with prior authorization transactions, this rule also proposes to adopt a modification to the standard for the referral certification and authorization transaction (X12 278) to move from Version 5010 to Version 6020.
• On December 16, 2022, FDA issued draft guidance entitled, Evaluating the Safety of Antimicrobial New Animal Drugs with Regard to Their Microbiological Effects on Bacteria of Human Health Concern. This draft guidance informs stakeholders about FDA’s current method for evaluating potential microbiological effects of antimicrobial new animal drugs on bacteria of human health concern as part of the new animal drug application process.
• On December 16, 2022, CMS issued a final rule entitled, Basic Health Program; Federal Funding Methodology for Program Year 2023 and Changes to the Basic Health Program Payment Notice Process. This rule finalizes the methodology and data sources necessary to determine federal payment amounts to be made for program year 2023 to states that elect to establish a Basic Health Program under the Patient Protection and Affordable Care Act to offer health benefits coverage to low-income individuals otherwise eligible to purchase coverage through Health Insurance Exchanges.

Event Notices

• January 24-25, 2023: The National Institutes of Health (NIH) announced a partially open meeting of the Eunice Kennedy Shriver National Institute of Child Health and Human Development (NICHD) National Advisory Child Health and Human Development (NACHHD) Council. The open agenda will include opening remarks and discussions on administrative matters, the NICHD Directors’ Report, and other business of the Council. The closed agenda will include review and evaluation of grant applications.
• January 25, 2023: NIH announced a partially open meeting of the National Diabetes and Digestive and Kidney Diseases (NIDDK) Advisory Council. The open agenda will include a presentation of the Director's Report and other scientific presentations and the closed agenda will include review and evaluation of grant applications.
• January 25, 2023: NIH announced a partially open meeting of the National Institute of Biomedical Imaging and Bioengineering (NIBIB) National Advisory Council for Biomedical Imaging and Bioengineering (NACBIB). The open agenda will include reports from the Institute Director, Council Members and other Institute staff. The closed agenda will include review and evaluation of grant applications.
• January 26, 2023: NIH announced a partially open meeting of the National Center for Advancing Translational Sciences (NCATS) Advisory Council. The open agenda will include a report from the Institute Director, invited speaker presentations, and program updates from the Office of Special Initiates (OSI) and Office of Strategic Alliances (OSA). The closed agenda will include review and evaluation of grant applications.
• January 26, 2022: FDA announced a public advisory committee meeting of the Vaccines and Related Biological Products Advisory Committee (VRBPAC). The committee will discuss the future vaccination regimens addressing COVID-19. This discussion will include consideration of the composition and schedule of the primary series and booster vaccinations.
• January 30, 2022: NIH announced an open meeting of the National Heart, Lung, and Blood Institute (NHLBI) Sickle Cell Disease Advisory Committee (SCDAC). The agenda will include research, engagement and representation from the community.
• February 6, 2023: NIH announced a partially open meeting of the National Institute on Minority Health and Health Disparities (NIMHD) National Advisory Council on Minority Health and Health Disparities (NACMHD). The open agenda will include opening remarks and discussions on administrative matters, the Director’s Report, presentations, and other business of the Council. The closed agenda will include review and evaluation of grant applications.
• February 8-9, 2023: The Center for Disease Control and Prevention (CDC) and Agency for Toxic Substances and Disease Registry (ATSDR) announced the Winter 2023 CDC/ATSDR Tribal Advisory Committee (TAC) meeting. The agenda will include discussions on tribal priorities for CDC and ATSDR, public health capacity in Indian country, and programmatic highlights.
• February 9, 2023: CDC and ATSDR announced the 2023 CDC/ATSDR Tribal Consultation. CDC/ATSDR is hosting this meeting to hold consultation with federally recognized tribal nations to receive input and guidance on strengthening relationships during the implementation of the CDC Moving Forward Initiative. CDC/ATSDR is seeking feedback on how the agency can better engage with Indian country through meaningful consultation. The consultation will be held to also hear from tribes on their priorities as the U.S. transitions out of the COVID-19 public health emergency (PHE) and on how CDC/ATSDR can better support tribes and tribal communities moving forward.

II. Congressional Hearings

U.S. House of Representatives

• On December 14, 2022, the House Committee on Oversight and Reform Select Subcommittee on the Coronavirus Crisis held a hearing entitled, Preparing for and Preventing the Next Public Health Emergency: Lessons Learned from the Coronavirus Crisis. Witnesses present included: Dr. Rick Bright, Former Director of the Biomedical Advanced Research and Development Authority, (BARDA) and Deputy Assistant Secretary for Preparedness and Response (ASPR); Dr. Kizzmekia Corbett, Assistant Professor of Immunology and Infectious Diseases, Harvard T.H. Chan School of Public Health, on behalf of Former Researcher, Vaccine Research Center, NIH; Rebecca Dixon, Executive Director, National Employment Law Project; and Dr. Ngozi Ezike, President and Chief Executive Officer, Sinai Chicago, on behalf of Former Director, Illinois Department of Public Health.

U.S. Senate

• On December 13, 2022, the Committee on Agriculture, Nutrition, and Forestry Subcommittee on Nutrition, Agricultural Research, and Specialty Crops held a hearing entitled, Food As Medicine: Current Efforts and Potential Opportunities. Witnesses present included: Mr. Martin Richards, Executive Director, Community Farm Alliance; Ms. Leah Penniman, Founding Co-Executive Director, Soul Fire Farm; Dr. John Bulger, Chief Medical Officer, Insurance Operations and Strategic Partnerships, Geisinger Health Plan; Dr. Kevin Volpp, Founding Director, Center for Health Incentives and Behavioral Economics (CHIBE), University of Pennsylvania, Member, Advocacy Coordinating Committee, American Heart Association; and Dr. Bob Chestnut, Chief Medical Director, Cummins Inc.
• On December 15, 2022, the Senate Special Committee on Aging held a hearing entitled, Setting the Table: Promoting Healthy and Affordable Food for Older Americans. Witnesses present included: Jeremy Everett, Founder and Executive Director, Baylor Collaborative on Hunger and Poverty; Dr. Temitope Walker, Senior Hunger Nutrition Coordinator, Georgia Department of Human Services; Tom Gilroy, Volunteer, East Cooper Community Outreach; and Elayne Masters, Nutrition Advocate, Allegheny County.

III. Reports, Studies & Analyses

• On December 12, 2022, HHS Office of Inspector General (OIG) published a report entitled, The Centers for Medicare & Medicaid Services' Review Contractors Generally Did Not Document Medicaid Managed Care Payment Review Determinations Made Under the Payment Error Rate Measurement Program in Accordance with Federal and State Requirements. OIG assessed the adequacy of the Payment Error Rate Measurement (PERM) program, which aims to measure improper payments in Medicaid and the Children's Health Insurance Program (CHIP). As such, OIG reviewed 407 PERM Medicaid Managed Care (MMC) payments reviewed by CMS's PERM contractor, totaling $476,065 ($291,356 federal share), to determine whether CMS's MMC payment reviews that were in accordance with federal requirements. OIG found that CMS's review contractor conducted an estimated 60 percent of its MMC payment reviews in accordance with federal requirements. OIG concluded that CMS's review contractor may not have maintained adequate documentation of its payment review determinations because CMS did not include specific documentation requirements to support its MMC payment review determinations. However, OIG did not issue any recommendations because CMS took action to address these deficiencies.
• On December 12, 2022, the Kaiser Family Foundation (KFF) released a report entitled, Entering the Winter Season, How Many Nursing Facility Residents and Staff Were Up-To-Date With Their COVID-19 Vaccines? The report expressed concern that only 45 percent of nursing home residents and 22 percent of nursing home staff were up to date (defined by the CDC as having received a bivalent booster or a final shot of the original vaccines less than two months ago) with their COVID-19 vaccines. KFF predicted this may be due to a lack of ongoing federal initiatives that helped bolster initial vaccination rates among nursing home residents and staff. The report also noted that the low rates of up to date vaccination were particularly concerning given the heightened vulnerability of nursing home staff and residents and given that one-fifth of all U.S. COVID-19 deaths occurred among residents and staff in long-term care (LTC) facilities. KFF recommended creating new opportunities for on-site vaccinations, updating the health care worker vaccination mandate, and providing continued education and communication to the nursing home population to prevent exacerbated rates of illness and death in the 2022 holiday season.
• On December 14, 2022, GAO published a report entitled, Thrifty Food Plan: Better Planning and Accountability Could Help Ensure Quality of Future Reevaluations. Benefits in the Supplemental Nutrition Assistance Program (SNAP) are based on the Thrifty Food Plan (TFP), which estimates how much it a healthy diet on a budget would cost for family of four. In response to the COVID-19 pandemic, in 2021, the U.S. Department of Agriculture (USDA) updated the TFP beyond inflation to result in a 21 percent increase in SNAP benefits and accelerated the timeline for beneficiaries’ reevaluation of their benefits by six months. GAO issued this study to examine (1) USDA's administrative process for reevaluating the TFP in 2021; (2) the extent to which USDA gathered and analyzed external input to inform the reevaluation; and (3) how the methodology and results of the reevaluation compared to methodological standards. GAO found that the reevaluation process was complex and conducted without three key project management elements: (1) a charter, (2) a comprehensive project management plan, and (3) a dedicated project manager. As such, GAO issued recommendations for the USDA to enhance its TFP reevaluation process, including for USDA to utilize peer review guidelines, quality standards, and public reporting standards.
• On December 15, 2022, HHS OIG released an annual publication entitled, OIG's Top Unimplemented Recommendations: Solutions To Reduce Fraud, Waste, and Abuse in HHS Programs. This report outlines the top 25 unimplemented recommendations OIG has issued to HHS that OIG believes would most positively affect HHS programs in terms of cost savings, program effectiveness and efficiency, and public health and safety if implemented. The recommendations come from OIG audits and evaluations conducted through December 2021. The top 25 recommendations issued are for multiple agencies and include recommendations in areas such as building program integrity, ensuring complete and accurate data collection, seeking ways to reform programs to ensure cost-savings for patients and providers, and expanding access to services. The report also includes key OIG findings for each recommendation as well as HHS’ operating division’s (OpDiv) progress toward implementation.
• On December 15, 2022, GAO released a report entitled, CARES Act: Structural Characteristics That Can Help Insulate HHS Agencies against Potential Political Interference. GAO noted that shortcoming to the COVID-19 pandemic response could be due to political interference (e.g., how many political appointees the agency had and whether or not the agency had an advisory committee) within and among four HHS agencies – CDC, FDA, NIH, and ASPR. As such, GAO evaluated structural and other characteristics that can help insulate the agencies from political interference. GAO found that although the agencies do have certain insulating characteristics in place (e.g., having leaders selected by the President and confirmed by the Senate or having advisory committees with external experts), they do not have many of the insulating characteristics independent agencies (e.g., the Federal Reserve) have that allow them to operate outside of the President’s influence. Senior agency officials have recommended various measures to further insulate HHS agencies from political interference, such as converting FDA into an independent agency; making the CDC director a Senate-confirmed position; and reducing the number of political appointees at the selected agencies.
• On December 15, 2022, GAO published a report entitled, Private Health Insurance: State and Federal Oversight of Provider Networks Varies. GAO assessed the adequacy of provider networks in individual and group health plans, as well as state, CMS, and DOL oversight of the adequacy of provider networks. GAO defined provider network adequacy as a health plan’s ability to deliver promised benefits through in-network providers and found that oversight of provider network adequacy by state agencies, HHS, and DOL varied. Specifically, GAO found that 32 states reported they review health plans’ provider networks prior to approving a plan for sale, CMS conducts annual and targeted reviews of QHPs offered on the FFEs, and DOL often conducts reviews for provider compliance with mental health parity requirements. GAO found that areas may have inadequate provider networks for several reasons, including provider shortages, challenges in contracting with providers, and geography (e.g., rural areas).
• On December 15, 2022, GAO published a report entitled, COVID-19 in Nursing Homes: Outbreak Duration Averaged 4 Weeks and Was Strongly Associated with Community Spread. GAO has been charged to monitor the federal pandemic response and CMS’ oversight of nursing homes given COVID-19’s disproportionate effect on nursing home residents and staff. As part of those efforts, GAO issued a study to understand how COVID-19 outbreaks affected nursing homes and what nursing home factors were associated with an outbreak duration. GAO specifically found that between June 2020 and December 2021, nursing homes faced many COVID-19 outbreaks lasting an average of about four weeks each. Nursing homes reported that the two most critical challenges they faced in addressing COVID-19 outbreaks were staffing shortages and low staff morale. GAO also found that COVID-19 transmission in the community had the strongest association with the duration of an outbreak in a nursing home. GAO also estimated that strong association with outbreak duration included nursing home size, staff shortages, and ownership type.

IV. Other Health Policy News

• On December 13, 2022, HHS Secretary Xavier Becerra, CMS Administrator Chiquita Brooks-LaSure, Health Resources & Services Administration (HRSA) Administrator Carole Johnson, White House Domestic Policy Advisor Susan Rice, and New Jersey First Lady Tammy Murphy joined other government and health care industry representatives to open the first CMS convening on maternal health entitled, We Can Do Better: Advancing Maternity Care Together. The convening is part of the Biden Administration’s continued efforts to improve maternal health outcomes. At the convening, CMS unveiled its Birthing-Friendly Hospital designation logo to be added to its Care Compare website; released its report entitled, Doula Care and Maternal Health: An Evidence Review, which explores the effect and role of doula care on maternal health outcomes; and highlighted additional efforts undertaken by the Biden Administration to improve maternal health, including the White House Blueprint for Addressing the Maternal Health Crisis and $470 million to address maternal health needs in the President’s 2023 budget. More information on this announcement can be found here.
• On December 14, 2022, CMS announced that a decline in federal government spending led to more modest growth in health care expenditures in 2021. Specifically, CMS’ National Health Expenditures (NHE) Report found that U.S. health care spending grew 2.7 percent in 2021 ($4.3 trillion), compared to a 10.3 percent increase in 2020. The slower growth in 2021 is attributable to the 3.5 percent decline in federal government health care expenditures and strong health care expenditure growth in 2020 due to the COVID-19 pandemic response. The slower growth also offset the impact of increased health care use and increased insurance coverage in 2021. The report also found that total health spending by funding source was highest by private insurers (28 percent), followed by Medicare (21 percent), Medicaid (17 percent), and out-of-pocket financing (10 percent). Health care spending for the three largest services was 31 percent on hospital care, 20 percent on physician and clinician services, and 9 percent on detail prescription drugs. More information on this announcement can be found here.
• On December 15, 2022, HHS published a readout of HHS Assistant Secretary for Health ADM Rachel Levine’s visit to Colorado Springs, Colorado to speak about the importance of mental health care. During her visit, she met with survivors of the Club Q shooting and hosted a provider roundtable on crisis mental health care and post-trauma mental health needs for communities. Providers shared their experiences and challenges in meeting community needs after a traumatic event and emphasized the need for improved survivor-care culture. More information on this announcement can be found here.
• On December 16, 2022, HHS, through SAMHSA, awarded more than $130 million in 988 Suicide & Crisis Lifeline grants under the Bipartisan Safer Communities Act to address the ongoing mental health and substance use crises. The funding includes $47 million to states and U.S. territories to expand the 988 services, $21.1 million in 988 Lifeline Tribal Response Grants and technical assistance to tribal communities, and $64.8 million to the 988 Lifeline administrator, Vibrant Emotional Health, to expand 988 crisis centers, expand language-based services, and improve operations and access to populations known to be at higher risk for suicide and mental health crises. Overall, these efforts follow the Bipartisan Safer Communities Act’s goals to strengthen the mental health care system, school safety programs, and gun safety laws. More information on this announcement can be found here.

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