Healthcare Roundup: November 16, 2021

In the Lede

The President announced his intention to nominate Dr. Robert Califf to be the next Food and Drug Administration (FDA) Commissioner. Califf served as FDA Commissioner during the last year of the Obama Administration from 2016-2017. Currently, Califf is a professor of medicine at the Duke University School of Medicine, where he previously served as Vice Chancellor and founded the Duke Clinical Research Institute, and also works as Head of Clinical Policy at Verily Life Sciences, a life sciences research organization. While several Democrats opposed his nomination in 2016, he was still overwhelmingly confirmed in a 89-4 vote. Sen. Joe Manchin (D-WV), as in 2016, continued to voice opposition to Califf's nomination, stating, "Dr. Califf's nomination makes no sense as the opioid epidemic continues to wreak havoc on families across this country with no end in sight...Dr. Califf's nomination and his significant ties to the pharmaceutical industry take us backwards not forward."

The Department of Health and Human Services (HHS) announced the withdrawal of an August 2020 Trump Administration policy that directed the Food and Drug Administration (FDA) not to enforce premarket review requirements for laboratory developed tests (LDTs), including COVID-19 tests. HHS Secretary Xavier Becerra said that the policy established by the previous administration limited FDA's ability to address certain problematic COVID-19 tests. The FDA also updated its policies regarding tests, including LDTs, currently being offered prior to or without authorization, as well as policies regarding the types of tests on which the FDA intends to focus its review. Moving forward, the FDA indicated that it generally intends to focus its review on emergency use authorization (EUA) requests for the following types of tests:

At-home and point-of-care (POC) diagnostic tests for use with or without a prescription and that can be manufactured in high volumes;
Certain high-volume, lab-based molecular diagnostic tests (and home collection kits for use with such tests) that expand testing capacity or accessibility such as through pooling of specimens to increase throughput, testing specimens collected at home and shipped to the lab, screening asymptomatic individuals or detecting multiple different respiratory viruses at once;
Certain lab-based and POC high volume antibody tests that can measure the amount of antibodies (fully quantitative antibody tests) or the amount of neutralizing antibodies; and
Tests for which the request is from, or supported by, a U.S. government stakeholder, such as the Biomedical Advanced Research and Development Authority or the National Institutes of Health's Rapid Acceleration of Diagnostics.

Developers of other tests may consider pursuing marketing authorization through traditional device review pathways such as 510(k) notification or De Novo classification. According to the guidance, 'Policy for Coronavirus Disease-2019 Tests During the Public Health Emergency (Revised),' the FDA now generally expects newly offered COVID-19 tests, including LDTs, to have an EUA, or traditional marketing authorization such as a granted De Novo or cleared 510(k), prior to clinical use. As discussed in the previous COVID-19 test policies, some developers were offering their tests prior to or without an EUA after the test was validated and a notification was provided to the FDA. Those policies were intended to expedite the availability of tests, though led to some poorly performing tests being offered prior to FDA review. Importantly, the policies never applied to at-home or home collection tests. With that in mind, and given the number of authorized tests available, the FDA is ending those notification policies going forward. For tests currently being offered without the submission of an EUA request, the FDA generally expects the submission of an EUA request as described in the guidance. For such tests and notified tests with pending EUA requests, FDA generally intends to review the EUA requests and, if the test is not subsequently authorized, expects developers to cease marketing the test within 15 calendar days of being notified.

On the Hill

House Energy and Commerce Committee will markup several healthcare-related bills tomorrow, Wednesday, November 17, including:

the Early Hearing Detection and Intervention Reauthorization Act of 2021 (H.R. 5561), legislation that would extend the authorization for Early Hearing Detection and Intervention programs at the Health Resources and Services Administration (HRSA), the Centers for Disease Control and Prevention (CDC), and the National Institutes of Health (NIH);
the Stillbirth Health Improvement and Education (SHINE) for Autumn Act of 2021 (H.R. 5487), legislation aimed at improving research and data collection on stillbirths by authorizing grants to states for surveillance and data collection relating to stillbirth and stillbirth risk factors, developing guidelines and education materials for state departments of health, and establishing the Perinatal Pathology Fellowship Program at NIH to increase research on stillbirth;
the Cardiovascular Advances in Research and Opportunities Legacy (CAROL) Act (H.R. 1193), legislation that would expand research on valvular heart disease (VHD) and its treatment by authorizing a grant program administered by NIH in collaboration with the National Heart, Lung, and Blood Institute (NHLBI) to support research on valvular heart disease;
the Dr. Lorna Breen Health Care Provider Protection Act (H.R. 1667), legislation introduced by Rep. Susan Wild (D-PA) that would require the Department of Health and Human Services (HHS) to award grants for relevant mental and behavioral health training for health care students, residents, or professionals;
the Allied Health Workforce Diversity Act of 2021 (H.R. 3320), which would allow HHS to award grants and contracts to accredited graduate education programs to increase diversity in the physical therapy, occupational therapy, respiratory therapy, audiology, and speech-language pathology professions;
the Oral Health Literacy and Awareness Act of 2021 (H.R. 4555), which would authorize a public education campaign across all relevant programs of HRSA to increase oral health literacy and awareness;
the Improving the Health of Children Act (H.R. 5551), which would reauthorize the National Center on Birth Defects and Developmental Disabilities (NCBDDD) at CDC, expand the scope of programmatic work, incorporate funding for folic acid education and research into core Center duties, and increase the overall authorization level for NCBDDD to $186,010,000 for these activities each year from FY 2022-2026;
the Accelerating Access to Critical Therapies for ALS Act (H.R. 3537), which would award grants to certain small drug manufacturers to cover the cost of investigational drugs for the prevention, diagnosis, mitigation, treatment, or cure of amyotrophic lateral sclerosis (ALS), research associated with the investigational drug, and the provision of the investigational drug to patients not eligible for clinical trials; and
the Data Mapping to Save Moms' Lives Act (H.R. 1218), legislation that would require the Federal Communications Commission (FCC) to integrate data related to maternal health outcomes into the agency's Mapping Broadband Health in America platform within 180 days of enactment, with consultation from the CDC.

All of the bills were reported favorably by the Health Subcommittee – or in the case of H.R. 1218, by the Communications and Technology Subcommittee – earlier this month.

At the Agencies

The Centers for Medicare and Medicaid Services (CMS) released the 2022 premiums, deductibles, and coinsurance amounts for the Medicare Part A and Part B programs, and the 2022 Medicare Part D income-related monthly adjustment amounts. The standard monthly premium for Medicare Part B enrollees will be $170.10 for 2022, an increase of $21.60 from $148.50 in 2021. The annual deductible for all Medicare Part B beneficiaries is $233 in 2022, an increase of $30 from the annual deductible of $203 in 2021. Medicare Part B covers physician services, outpatient hospital services, certain home health services, durable medical equipment, and certain other medical and health services not covered by Medicare Part A. According to CMS, the increases in the 2022 Medicare Part B premium and deductible are because of:

Rising prices and utilization across the health care system that drive higher premiums year-over-year alongside anticipated increases in the intensity of care provided.
Congressional action to significantly lower the increase in the 2021 Medicare Part B premium, which resulted in the $3.00 per beneficiary per month increase in the Medicare Part B premium (that would have ended in 2021) being continued through 2025.
Additional contingency reserves due to the uncertainty regarding the potential use of the Alzheimer's drug, Aduhelm™, by people with Medicare.

In July 2021, CMS began a National Coverage Determination analysis process to determine whether and how Medicare will cover Aduhelm™ and similar drugs used to treat Alzheimer's disease. While the outcome of the coverage determination is unknown, CMS noted that its projection in no way implies what the coverage determination will be – but had to plan for the possibility of coverage for the high cost Alzheimer's drug which could, if covered, result in significantly higher expenditures for the Medicare program. For Medicare Part A – which covers inpatient hospital, skilled nursing facility, hospice, inpatient rehabilitation, and some home health care services – deductible for inpatient hospital that beneficiaries pay if admitted to the hospital will be $1,556 in 2022, an increase of $72 from $1,484 in 2021. The Part A inpatient hospital deductible covers beneficiaries' share of costs for the first 60 days of Medicare-covered inpatient hospital care in a benefit period. In 2022, beneficiaries must pay a coinsurance amount of $389 per day for the 61^st through 90^th day of a hospitalization ($371 in 2021) in a benefit period and $778 per day for lifetime reserve days ($742 in 2021). For beneficiaries in skilled nursing facilities, the daily coinsurance for days 21 through 100 of extended care services in a benefit period will be $194.50 in 2022 ($185.50 in 2021). Medicare Open Enrollment for 2022 began on October 15, 2021, and ends on December 7, 2021. During this time, people eligible for Medicare can compare 2022 coverage options between Original Medicare, and Medicare Advantage, and Part D prescription drug plans.

CMS issued a final rule formally rescinding the Medicare Coverage of Innovative Technology and Definition of "Reasonable and Necessary" (MCIT/R&N) final rule because of concerns that the provisions in the Trump-era final rule may not have been sufficient to protect Medicare patients. The MCIT/R&N final rule would have granted expedited Medicare coverage for up to four years for certain Food and Drug Administration (FDA)-designated "breakthrough" devices once it receives or clears market authorization. However, the kinds of clinical studies needed for FDA market authorization might not consider the differences in clinical profiles, complexities of medical conditions, or associated treatments of the diverse population of Medicare patients, according to CMS. In rescinding the rule, the agency indicated that it "intends to explore coverage process improvements that will enhance access to innovative and beneficial medical devices in a way that will better suit the health care needs of people with Medicare" that will also help to establish a process in which the Medicare program covers new technologies on the basis of scientifically sound clinical evidence. CMS noted that there are existing and proven pathways that allow for coverage of a specific medical device or service, including through claim-by-claim determinations, under one or more local coverage determinations, or a national coverage determination. CMS plans to work with the FDA, Agency for Healthcare Research and Quality (AHRQ), medical device manufacturers, and other stakeholders to develop an expeditious process to cover innovative devices that benefit Medicare patients, and intends to hold at least two stakeholder public meetings in 2022 to inform future policy-making. Earlier this month, 12 Senators sent a letter to CMS Administrator Chiquita Brooks-LaSure calling on CMS to develop a new rule that provides a pathway for coverage allowing for collection of appropriate evidence for Breakthrough Devices, while addressing concerns about operationalization and patient benefit.

CMS announced that in week one of the 2022 Open Enrollment Period, approximately 773,500 people selected individual market plans in the 33 states that utilize the HealthCare.gov platform. Of those who selected plans, more than 640,000 were renewing customers, while 133,000 were new consumers. During Open Enrollment, CMS will release weekly enrollment snapshots that provide point-in-time estimates of weekly plan selections, Marketplace Call Center activity, and visits to HealthCare.gov and CuidadoDeSalud.gov for states that utilize the platform. About 2.1 million people newly gained access to affordable health care coverage during the 2021 Special Enrollment Period (SEP) on HealthCare.gov ahead of the 2022 Open Enrollment Period.

CMS announced that through its "aggressive corrective actions", improper payments of Medicare fee-for-service (FFS) were reduced by an estimated $20.72 billion over seven years. The 2021 Medicare FFS estimated improper payment rate (claims processed July 1, 2020 to June 30, 2021) is 6.26%, or $25.03 billion ̶ an historic low representing the fifth consecutive year the Medicare FFS improper payment rate has been below the 10% threshold for compliance established in the Payment Integrity Information Act of 2019. CMS touted key successes in the following areas:

Inpatient Rehabilitation Facility claims had a $1.81 billion decrease in estimated improper payments from 2018 to 2021 as a result of years of "sustained effort" from CMS, which included clarifying policy to reduce provider burden and educating providers through the Targeted Probe and Educate program.
Durable Medical Equipment (DME) claims saw a $388 million reduction in estimated improper payments since 2020 due to a nationwide expansion of prior authorization of certain DME items as well as the Targeted Probe and Educate program.

The Medicare Fee-for-Service (FFS) program improper payment rate is estimated through the Comprehensive Error Rate Testing (CERT) program, which reviews a statistically valid stratified random sample of Medicare FFS claims to determine if they were paid properly under Medicare coverage, coding, and payment rules. Medicaid paid out nearly $98.4 billion in overpayments from July 2020 through June 2021, which is about 21.6% of total program reimbursements, while the Children's Health Insurance Program (CHIP) had the highest overpayment rate at 31.8%, or $5.4 billion.

In the News

Washington Post:  The last drugstore: Rural America is losing its pharmacies

Bloomberg:  Costly Alzheimer's Drug Fuels Record Medicare Premium Hike

Kaiser Health News:  As Big Pharma and Hospitals Battle Over Drug Discounts, Patients Miss Out on Millions in Benefits

Associated Press:  FDA updates COVID-19 test policies