Legislative Updates

On January 11, the Department of Health and Human Services (HHS) Secretary Xavier Becerra extended the COVID-19 Public Health Emergency (PHE) declaration. The PHE is now set to expire on April 11, 2023.

During the PHE the Centers for Medicare & Medicaid Services (CMS) temporarily approved a number of telehealth flexibilities. With the Omnibus that passed at the end of 2022, these telehealth flexibilities were extended for two years, and are set to expire December 31, 2024.

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Lawmakers unveiled their long-awaited $1.7 trillion government funding package on Dec. 20, 2022. As of publishing, it seems likely that a vote on final passage in the U.S. Senate will occur at some point today or tomorrow, with a final up-or-down vote in the House of Representatives taking place ahead of the December 23 government funding deadline.

The information below is focused on notable Medicare and Medicaid policies and is not reflective of every policy or funded program.

Medicare

·    Medicare Physician Payment Reductions: The omnibus package will reduce expected reductions to Medicare reimbursement for physician services over the next two years. Accordingly, the omnibus increases the Medicare conversion factor by 2.5 percent for 2023 and 1.25 percent for 2024. Watch for a new fee schedule in your area. Will this delay claims in the New Year? I guess we have to wait and see.

·    Alternative Payment Model (APM) Bonuses: Currently, Advanced APMs can only earn the 5 percent payment incentive through the end of 2022. (There is a two-year lag between performance and payment years.) After this, there will be a "gap year" between the expiration of the bonus payments and the restart of modest (cheap) annual conversion factor updates, leaving less incentive for providers to participate in an Advanced APM in 2023. To address this, the omnibus provides a one-year bonus for providers who are part of APMs – but rather than keep that bonus at 5 percent, the bill lowers the bonus to 3.5 percent. The bill also extends the current freeze on participation thresholds for qualification for the APM bonuses for an additional year.

·    PAYGO: The omnibus halts the looming statutory Pay-As-You-Go (PAYGO) sequestration in 2023 and 2024. It may be back in 2025. PAYGO requires that mandatory spending and revenue legislation not increase the federal budget deficit over a 5-year or 10-year period. Should such legislation be enacted without offsets, the Office of Management and Budget (OMB) is required to implement sequestration, or across-the-board reductions, in certain types of mandatory federal spending. The Congressional Budget Office (CBO) estimated that a Statutory PAYGO sequester in fiscal year (FY) 2022 resulting from the American Rescue Plan Act of 2021 passage would cause a 4 percent reduction in Medicare spending or cuts of approximately $36 billion.

·    Telehealth: The omnibus continues Medicare's expanded access to telehealth by extending COVID-19 telehealth flexibilities for an additional two years through Dec. 31, 2024. The bill also extends through calendar year 2024 the flexibility to exempt telehealth services from the deductible in high-deductible health plans (HDHPs) that can be paired with a Health Savings Account (HSA). Hooray!!!!

·    PAMA: The omnibus delays for one year pending payment reductions and data reporting periods for the Clinical Laboratory Fee Schedule under the Protecting Access to Medicare Act (PAMA).

·    Separate OPPS Payment for Non-Opioid Packaged Treatments: The omnibus provides a separate (capped at 18 percent) Medicare payment, from 2025 through 2027, for non-opioid treatments that are currently packaged into the payment for surgeries under Medicare's Outpatient Prospective Payment System (OPPS).

·    Lymphedema treatment. The final package folds in provisions of the Lymphedema Treatment Act, which expands Medicare coverage for lymphedema-related pressure garments. The new coverage will go into effect in 2024 and could affect more than 3 million Medicare beneficiaries.

·    CBO Part D Data Authorization: Authorizes the CBO to access prescription drug payment data, including rebate and direct and indirect remuneration (DIR) data, under Medicare Part D.

·    Acute Hospital Care at Home Waivers: The omnibus will extend the waivers by two years until the end of 2024. CMS has approved more than 250 hospitals to participate in the acute hospital care at-home program.

·    Sequester Extension and Other Offsets: The package would extend sequestration for the first six months of FY 2032 to help offset the package cost. The sequester policy would also smooth out the sequester cuts in later years and keep the Medicare sequestration percentages at 2 percent for FY 2030 and FY 2031. Hopefully, we will all be retired by then.

Medicaid

·    The Children's Health Insurance Program (CHIP): The omnibus extends funding for CHIP for two years through FY 2029. The omnibus also requires children to be provided with 12 months of continuous coverage in Medicaid and CHIP, effective January 1, 2024.

·    Modifications to Postpartum Coverage Under Medicaid and CHIP: The bill makes permanent a state option to allow states to continue to provide 12 months of continuous coverage during the postpartum period in Medicaid or CHIP.

·    Medicaid Redeterminations Transitioning From Medicaid FMAP Increase Requirements: Under the Families First Coronavirus Response Act, each state was eligible for a 6.2 percentage point increase in its Federal Medical Assistance Percentage (FMAP) if it met several conditions. Among these was the institution of a continuous enrollment policy for Medicaid beneficiaries, States could not remove individuals from Medicaid rolls until the end of the COVID-19 public health emergency (PHE). Now, the omnibus lets states start Medicaid redeterminations (eligibility checks) at the beginning of April, even if the PHE is still in effect. Please verify your Medicaid patients or dual eligibles during that period.

·    Medicaid Funding for U.S. Territories: The omnibus extends Puerto Rico's higher federal Medicaid match of 76 percent through FY 2027 and permanently extends a higher federal Medicaid match of 83 percent for American Samoa, the Commonwealth of the Northern Mariana Islands, Guam and the U.S. Virgin Islands.

·    340B: In the accompanying report language, Congress directed HRSA, which oversees the 340B program, to provide a briefing to Congress on actions taken to safeguard 340B covered entities’ “lawful access” to discounted drugs. Over the past several years, 18 drug manufacturers have ended discounted pricing to 340B hospitals with regard to contracted pharmacies. In response, HRSA exercised its authority to refer these companies to the Office of the Inspector General to impose civil monetary penalties. Several drug companies then filed lawsuits challenging the government’s authority to enforce penalties against them. This just goes on and one and this provision is kind of toothless.

There is much, much more in this bill. To view it, go to this site.

On August 25, the Centers for Medicare & Medicaid Services (CMS) issued a final rule indefinitely delaying the start of the Radiation Oncology (RO) Model. CMS will establish new start and end dates for the model through future rulemaking, which may also modify the model’s design. CMS will propose a new start date for the model at least six months prior to the proposed date.

According to CMS, the delay was finalized due to the amount of operational resources required for the agency and RO model participants to prepare to implement the model and a lack of stakeholder support for the model unless specific changes are made. Read more

On July 27, 2022, the House of Representatives passed the Advancing Telehealth Beyond COVID–19 Act of 2021 (H.R.4040). The bill, which was introduced by Representatives Liz Cheney (R-WY-AL) and Debbie Dingell (D-MI-12), would extend telehealth flexibilities for two years, through the end of 2024.

Specifically, the legislation would:  • remove geographic and originating site restrictions • expand providers who can offer telehealth service—including physician assistants, nurse practitioners, and others  • allow Medicare reimbursement of telehealth services provided by physicians and practitioners working for Federally Qualified Health Centers (FQHCs) and Rural Health Centers (RHCs)  • allow audio-only telehealth services  • expand access to telehealth services for the recertification of hospice care eligibility during an emergency period 

The Association for Clinical Oncology (ASCO) was pleased to see that several provisions in the bill align with provisions in the Permanency for Audio-Only Telehealth Act and the CONNECT for Health Act and Telehealth Modernization Act—two bills that ASCO endorsed and advocated for on Capitol Hill. Those provisions include removing geographic and originating site restrictions, expanding reimbursement for telehealth services provided by physicians working for FQHCs and RHCs, and expanding access to audio-only telehealth services.

The bill has moved to the Senate, where its path forward is unclear. While there is broad support for extending telehealth flexibilities beyond the COVID-19 Public Health Table of Contents Encourage your members to join the State Society Network Emergency, a full agenda and limited legislative days are creating obstacles.

Take action now via the ASCO ACT Network. 

The formal legislative session ended this morning around 10 AM. The House and Senate could not reach a consensus on the differing approaches to the issue of the timeline for insurers to act on step therapy exemptions. The House had 3 business days/ 1 business day for emergencies. The Senate had 72 hrs/24 hrs, similar to what was in the original bill. The legislative leaders were busy dealing with major issues in the closing days of the session and didn’t get to step therapy.  However, we are told they will deal with it during an informal session which is in place for the remainder of the year. The latest compromise floated is 3 business days or 24 hrs. if an emergency.  More to come later. I am optimistic we will get a step therapy bill passed this year.

Provided by Edward J. Brennan, Esq. 

The Senate passed the step therapy bill today. The Senate reinstated the provision requiring insurers to grant or deny a step therapy exception request or an appeal back to 72 hrs. or 24 hrs. if additional delay would result in significant risk to the insured’s health or well-being. The House passed bill sets the time as 3 business days and the next business day. The House and Senate need to reconcile their differences. We have heard that the House will accept the Senate change. It looks like we will see the bill on the governor’s desk by the end of the week.

Gov. Baker signed the bill delaying until January 1, 2025 - the implementation of the state’s notice and disclosure law. The statute is Chapter 107 of the acts of 2022.

This is good news and will give the state and health care providers time and the opportunity to assess implementation of the federal No Surprises Act provisions relating to patient notices and pricing disclosures. From the perspective of the provider community, it would be best if the state deferred to the feds, or at least make them consistent. We will continue to monitor this issue.

Supreme Court Strikes Down 340B Cuts

On July 15, 2022, the Centers for Medicare & Medicaid Services (CMS) released its proposed rule for the 2023 Medicare Hospital Outpatient Prospective Payment System (OPPS).

In June 2022, the Supreme Court ruled that the Department of Health and Human Services (HHS) may not vary reimbursement rates for drugs and biologicals among groups of hospitals without conducting a survey of hospital acquisition costs. Given the timing of the Supreme Court decision, CMS was unable to adjust its proposed payment rates and budget neutrality calculations to account for the decision before issuing its proposal.

As a result, while CMS is proposing a reimbursement rate of average sales price (ASP) minus 22.5% for drugs and biologicals acquired through the 340B drug pricing program, the agency anticipates finalizing a reimbursement rate of ASP plus 6% for such drugs and biologicals in the 2023 final rule.

While changes to the OPPS payment rates and the conversion factor that reflect the Supreme Court decision are anticipated to be reflected in the language of the final rule, in the interim, CMS will make relevant impact tables and other supporting data associated with the alternative policy available.

Prior Authorization: CMS is continuing to advance its Prior Authorization program in Medicare; however, new additions to the list of items or services requiring prior authorization are not directly related to cancer care. Specifically, CMS is proposing to add facet joint interventions as a category of services to the prior authorization process for hospital outpatient departments beginning March 1, 2023.

As expected, the House today took up the pandemic policy extension bill passed by the Senate on Tuesday. In its version of the bill, the House removed from the 2020 law on notice and disclosure the section requiring DPH to implement the law including the provision that would impose fines of up to $2,500 on providers for each violation of the notice and disclosure provisions of the law. The Senate had only delayed implementation of the law and penalties until 2025.

The House and Senate will now need to reconcile their versions of the bill. There are other provisions of the overall bill that will need to be reconciled as well. For health care providers, the likelihood that the state’s implementation along with penalties will be either delayed 2.5 years or not enforced at all is likely.

Legislative Report provided by Edward J. Brennan, Jr., Esq. Legislative Update: As the state legislature enters its final month of formal session which ends July 31, there are several major health care initiatives in play.  Prescription Drug Costs: Senate has passed and sent to the House a bill (S.2695) providing State oversight of prescription drug costs. Regulatory Barriers to Expansion of Large Health Care Systems: The House has passed and sent to the Senate a bill designed to help struggling community hospitals.  Behavioral Health: Both the House and Senate have passed similar bills addressing behavioral health which are now before a conference committee to reconcile the differences.  Gov. Baker filed health care reform bill.  Cancer related legislation MSCO is monitoring: Step Therapy: It goes to the Senate which is expected to pass it before the July 31 end of the formal legislative session. Prescription Co-Pay Assistance Co-Pay Accumulators Fertility Preservation Telehealth: MSCO continues to monitor the Massachusetts Division of Insurance (DOI) which released draft regulations to implement the telehealth provisions passed by the legislature in early 2021, including parity in reimbursement (equal to face to face services) for chronic disease management through the year 2022.

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