Health Care Week in Review: CMMI Announces Three New Models, President Biden Issues Executive Order

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, CMMI announced three new innovation models aimed at lowering prescription drug costs, and President Biden issued an Executive Order on advancing racial equity and supporting underserved communities. Read more about these actions and other news below. 

I. Regulations, Notices & Guidance 

• On February 13, 2023, the Centers for Medicare & Medicaid Services (CMS) issued a proposed rule entitled, Medicare and Medicaid Programs; Disclosures of Ownership and Additional Disclosable Parties Information for Skilled Nursing Facilities and Nursing Facilities. This proposed rule would implement portions of section 6101 of the Patient Protection and Affordable Care Act (Affordable Care Act), which require the disclosure of certain ownership, managerial, and other information regarding Medicare skilled nursing facilities (SNFs) and Medicaid nursing facilities. CMS is proposing to require nursing homes to submit certain data to CMS, including each member of a facility’s governing body and each person or entity that is an additional disclosable party of the facility. CMS is also proposing that the nursing facility would have to report the aforementioned information upon initially enrolling in Medicare or Medicaid and when revalidating their Medicare or Medicaid enrollment. CMS is proposing new definitions for private equity companies, real estate investment trusts, additional disclosable parties, and organizational structure. Comments on the proposed rule must be received by April 14, 2023.
• On February 16, 2023, the Agency for Healthcare Research and Quality (AHRQ) issued a notice entitled, Supplemental Evidence and Data Request on Behavioral Interventions for Migraine Prevention. AHRQ is seeking scientific information submissions from the public. Scientific information is being solicited to inform AHRQ’s review on Behavioral Interventions for Migraine Prevention, which is currently being conducted by AHRQ’s Evidence-based Practice Centers (EPC) Program. The EPC Program is dedicated to identifying as many studies as possible that are relevant to the questions for each of its reviews. AHRQ is looking for studies that report on Behavioral Interventions for Migraine Prevention, including those that describe adverse events.
• On February 16, 2023, the Food and Drug Administration (FDA) issued draft and revised guidances entitled, Product-Specific Guidances; Draft and Revised Draft Guidances for Industry; Availability. The guidances provide product-specific recommendations on, among other things, the design of bioequivalence (BE) studies to support abbreviated new drug applications (ANDAs). On June 11, 2010, FDA announced in the Federal Register the availability of a guidance for industry entitled Bioequivalence Recommendations for Specific Products, which explained the process that would be used to make product-specific guidances (PSGs) available to the public on FDA’s website. The guidances identified in this notice were developed using the process described in that guidance.
• On February 17, 2023, FDA issued draft guidance entitled, Product-Specific Guidance Meetings Between the Food and Drug Administration and Abbreviated New Drug Applicants Under the Generic Drug User Fee Act; Draft Guidance for Industry; Availability. This draft guidance provides recommendations to industry on PSG meetings between FDA and a prospective applicant preparing to submit to FDA or an applicant that has submitted an ANDA to FDA under the Federal Food, Drug and Cosmetic Act (FD&C Act). Specifically, this draft guidance provides information on requesting and conducting PSG meetings with FDA (PSG teleconferences, pre-submission PSG meetings, and post-submission PSG meetings), as outlined in the Generic Drug User Fee Amendments (GDUFA) Reauthorization Performance Goals and Program Enhancements Fiscal Years 2023- 2027 (GDUFA III commitment letter). This draft guidance is intended to provide procedures that will promote well-managed PSG meetings and help ensure that such meetings are scheduled and conducted in accordance with the time frames set forth in the GDUFA III commitment letter.
• On February 17, 2023, FDA issued a withdrawal of guidance entitled, Compliance Policy Guide Sec. 397.100 Accuracy Requirements for Indication of Temporal-Maximum Ultrasonic Power; Withdrawal of Guidance. FDA is withdrawing this guidance because the compliance policy guide (CPG) identified in this notice contains policies that have been superseded by a subsequent FDA action. On January 20, 2023, FDA issued a final rule entitled, Radiological Health Regulations; Amendments to Records and Reports for Radiation Emitting Electronic Products; Amendments to Performance Standards for Diagnostic X-ray, Laser, and Ultrasonic Products (88 FR 3638). The final rule repealed 21 CFR 1050.10, which includes performance standards for ultrasonic therapy products. Therefore, the policies in CPG Sec. 397.100 are no longer applicable, and this CPG is being withdrawn.

• February 27, 2023: The National Institutes of Health (NIH) announced a public meeting of the Frederick National Laboratory Advisory Committee (FNLAC). The meeting agenda will include a discussion of ongoing and new activities at the Frederick National Laboratory for Cancer Research (FNLCR).
• March 16, 2023: AHRQ announced a public meeting hosted by the AHRQ Center for Quality Improvement and Patient Safety (CQuIPS). The meeting is being held to discuss implementation of sets of standardized definitions and formats (Common Formats) with software developers and other interested parties. This meeting is designed as an interactive forum where software developers can provide input on use of the formats. AHRQ especially requests participation by and input from those entities which have used AHRQ’s technical specifications and implemented, or plan to implement, the Common Formats electronically.
• April 4, 2023 and November 7, 2023: FDA announced a series of two public meetings entitled, Electronic Submission of Adverse Event Reports to FDA Adverse Event Reporting System (FAERS) Using International Council for Harmonisation (ICH) E2B(R3) Standards. The purpose of these public meetings is to provide the pharmaceutical industry and other interested parties with updated information on the plans, progress, and technical specifications to upgrade electronic submission standards for drug, biological product, and drug- or biologic-led combination products in the premarket and post market safety surveillance programs managed by the Center for Drug Evaluation and Research (CDER) and the Center for Biologics Evaluation and Research (CBER). These meetings are part of a public meeting series initiated by FDA in 2019 to communicate FDA’s implementation plan and regional requirements for ICH E2B(R3). The 2023 meetings will focus on enhancements to electronic submission of Individual Case Safety Reports (ICSRs) in FAERS using ICH E2B(R3) standards. FDA is seeking input from stakeholders as it fulfills its commitment to implement ICH E2B(R3) and will use the information provided by the public to inform the enhancements to FAERS required for the implementation of ICH E2B(R3) standards and relevant regional variations.
• April 19, 2023: FDA announced a public meeting of the Anesthetic and Analgesic Drug Products Advisory Committee (AADPAC). The general function of the Committee is to provide advice and recommendations to FDA on regulatory issues. The Committee will discuss post marketing requirement 3033-11, issued to application holders of new drug applications (NDAs) for extended-release and long-acting opioid analgesics to evaluate long-term efficacy of opioid analgesics and the risk of opioid-induced hyperalgesia. The discussion will focus on a clinical trial designed to address these objectives. 

II. Hearings & Markups

U.S. House of Representatives 

• On February 15, 2023, the House Committee on Energy and Commerce Subcommittees on Health and Oversight and Investigations held a joint hearing entitled, President Biden's Border Crisis is a Public Health Crisis. Witnesses present included: Urbino Martinez, Brooks County Sheriff; Stuart Archer, CEO, Oceans Health Care; Rochelle Garza, President, Texas Civil Rights Project; and Brandon Judd, President, National Border Patrol Council.

  U.S. Senate 

• On February 16, 2023, the Senate Committee on Health, Education, Labor, and Pensions (HELP) held a hearing entitled, Examining Health Care Workforce Shortages: Where Do We Go From Here? Witnesses present included: Dr. James Herbert, President, University of New England; Dr. James Hildreth, President and CEO, Meharry Medical College; Dr. Sarah Szanton, Dean, Johns Hopkins School of Nursing; Dr. Leonardo Seoane, Chief Academic Officer, Ochsner Health; and Dr. Douglas Staiger, Professor, Department of Economics, Dartmouth College. 
• On February 16, 2023, the Senate Committee on Agriculture, Nutrition, & Forestry held a hearing entitled, Farm Bill 2023: Nutrition Programs. Witnesses present included: Stacey Dean, Deputy Under Secretary, Food, Nutrition, and Consumer Services, Department of Agriculture (USDA); and Cindy Long, Administrator, USDA.
• On February 16, 2023, the Senate Committee on Commerce, Science, and Transportation (CST) held a hearing entitled, Bringing Transparency and Accountability to Pharmacy Benefit Managers. Witnesses present included: Dr. Ryan Oftebro, CEO of Seattle-based independent pharmacy Kelley-Ross Pharmacy Group; Dr. Debra Patt, Oncologist, Texas Oncology; Dr. Erin Trish, Co-Director and Associate Professor of Pharmaceutical and Health Economics, Schaeffer Center, University of Southern California; and Dr. Casey Mulligan, Professor in Economics, University of Chicago.

III. Reports, Studies & Analyses

• On February 14, 2023, the Congressional Research Service (CRS) published a report entitled, Effects of Terminating the Coronavirus Disease 2019 (COVID-19) PHE and NEA Declarations. At the beginning of the COVID-19 pandemic, the COVID-19 public health emergency (PHE) was declared under the Public Health Service Act (PHSA) and a national emergency declaration was made under the National Emergencies Act (NEA). This report briefly outlines the effects caused by the expiration of both the PHE and NEA emergency declarations. The report notes that it may be difficult to determine the impact of the end of the COVID-19 PHE because some waivers, flexibilities, and program authorized under the PHE may end with the PHE, others may expire based on different parameters such as funding availability or legislation that disconnected the particular waiver, flexibility, or program from the PHE. Terminating an NEA declaration discontinues the exercise of invoked powers and authorities, but there are exceptions, which means some NEA provisions may not be immediately affected by the end of the NEA declaration.
• On February 15, 2023, the Congressional Budget Office (CBO) published a report entitled, The Budget and Economic Outlook: 2023 to 2033. CBO is projecting a federal budget deficit of $1.4 trillion for 2023. The report estimates that the federal deficit will likely increase over the coming years, reaching an estimate $2.7 trillion in 2033. The deficit amounts to 5.3 percent of gross domestic product (GDP) in 2023, swells to 6.1 percent of GDP in 2024 and 2025, and then declines in the two years that follow. After 2027, CBO projects the deficit to increase again, reaching 6.9 percent of GDP in 2033—a level exceeded only five times since 1946. CBO’s projection of the deficit for 2023 is now $0.4 trillion more than it was in May 2022; the projection of the cumulative deficit over the 2023–2032 period is now $3.1 trillion (or about 20 percent) more, largely because of newly enacted legislation and changes in CBO’s economic forecast, including higher projected inflation and interest rates.
• On February 16, 2023, the Government Accountability Office (GAO) published a report entitled, Institutional Review Boards: Actions Needed to Improve Federal Oversight and Examine Effectiveness. Institutional review boards (IRBs) are groups that review ethical and safety considerations for research involving human subjects, such as clinical trials. This report describes the composition of the IRB market and examines the Department of Health and Human Services (HHS) Office for Human Research Protections (OHRP) and FDA oversight of IRBs. GAO found the agencies inspect relatively few IRBs and that neither agency has conducted a risk-based assessment of their IRB inspection program to help ensure they inspect enough IRBs annually. GAO is recommending that OHRP and FDA conduct annual risk assessments to determine if the agencies are routinely inspecting an adequate number of IRBs and to optimize the use of inspections in the oversight of IRBs and protection of research participants, as well as examine and implement approaches for measuring IRB effectiveness.
• On February 17, 2023, the Kaiser Family Foundation (KFF) published a report entitled, A Look at Substance Use Disorders (SUD) Among Medicaid Enrollees. In the report, KFF notes that deaths from substance use disorders (SUDs) rose sharply during the COVID-19 pandemic, continuing a trend of increased mortality that was present in the years leading up to the pandemic. KFF states that the Medicaid population may be particularly impacted by SUDs, as 21 percent of Medicaid beneficiaries have a mild, moderate, or severe SUD, compared to 16 percent of commercially insured individuals. The report concludes that it is likely the SUD rates being calculated using Medicaid claims are undercounted. KFF also found that there are likely gaps in SUD screening and referral, meaning many individuals who need treatment are not receiving it.
• On February 17, 2023, CBO published a presentation entitled, How CBO Estimated the Budgetary Impact of Key Prescription Drug Provisions in the 2022 Reconciliation Act. CBO describes how it estimated the budgetary impact of three key prescription drug provisions in the Inflation Reduction Act of 2022 (IRA). In total, those provisions are expected to reduce the federal deficit by $129 billion from 2022 through 2031. The provisions included in the presentation are: (1) the requirement for HHS to negotiate prices for certain drugs covered under Medicare Part B and Part D; (2) the requirement that certain manufacturers of brand-name drugs must pay rebates if their prices exceed an inflation-adjusted benchmark; and (3) the IRA’s redesign of the Medicare Part D program. CBO provides an overview of each provision and explains how it estimated that each one would contribute to reducing the federal deficit.

IV. Other Health Policy News

• On February 14, 2023, in response to President Biden’s Executive Order 14087, Lowering Prescription Drug Costs for Americans HHS announced that it selected three new Center for Medicare and Medicaid Innovation (CMMI) models aimed at lowering prescription drug costs. The three models selected for CMMI implementation are:
  • The Medicare High-Value Drug List Model – Under this model, Medicare Part D plans would be encouraged to offer beneficiaries a lowered, fixed co-payment to cover all cost-sharing phases of the Part D drug benefit for a standardized list of generic drugs used for treatment of chronic conditions such as high blood pressure and high cholesterol. The model is designed to give Part D beneficiaries the cost certainty that their out-of-pocket cost for covered generic drugs will not exceed $2 per month for each drug.
  • The Cell and Gene Therapy Access Model – Under this model, state Medicaid agencies would allow CMS to coordinate and administer muti-state, outcomes-based partnerships with pharmaceutical manufacturers for certain cell and gene therapies. Through this model, CMMI is aiming to connect Medicaid beneficiaries with emerging cell and gene therapies that would potentially be unaffordable to the Medicaid population otherwise.
  • The Accelerating Clinical Evidence Model – Through this model, CMS would establish payment methods for drugs approved by FDA under accelerated approval in order to incentivize manufacturers to complete timely confirmatory trials and increase access to post-market safety and efficacy data.

  In a report, HHS provided an overview of the three models and identified additional areas of research where there is potential to develop solutions that would lower drug costs. More information on this announcement can be found here.      

• On February 15, 2023, CMS released a proposed National Coverage Determination (NCD) decision that would expand coverage for power seat elevation equipment on certain power wheelchairs to Medicare beneficiaries. If finalized, power seat elevation equipment would be covered by Medicare for individuals with a Group 3 power wheelchair, which are designed to meet the needs of people with Medicare with severe disabilities, in order to improve their health as they transfer from the wheelchair to other surfaces. CMS is encouraging public comment on the proposed NCD and is specifically interested in gathering additional scientific literature that provides evidence surrounding the medical necessity for seat elevation systems through studies that include measurable characteristics related to the performance of transfers. More information on this announcement can be found here.
• On February 16, 2023, President Biden issued an Executive Order (EO) entitled, Executive Order on Further Advancing Racial Equity and Support for Underserved Communities Through the Federal Government. The EO is intended to build upon previous equity-related EOs by extending and strengthening equity-advancing requirements for federal agencies. While the EO is broad in scope, it highlights the importance of developing policies that promote health equity for underserved communities in areas such as accessing behavioral health care, as well as accessing COVID-19 related services. The EO requires each federal agency, including HHS, to establish Agency Equity Teams to coordinate the implementation of Biden Administration equity initiatives and ensure that their respective agencies are delivering equitable outcomes. The EO also requires each federal agency to submit Equity Action Plans alongside their agency’s annual budget submissions to the Office of Management and Budget (OMB). More information about this EO can be found here.

Click here to view the members of our Health Care Legislative & Public Policy team.