Jul 17

The Washington Weekly: July 17, 2015


Tavenner To Lead America’s Health Insurance Plans (AHIP)
On Wednesday, July 15, America’s Health Insurance Plans (AHIP) announced that Marilyn Tavenner, the former Administrator for the Centers for Medicare and Medicaid Services (CMS), will become its new President and CEO starting August 24. Tavenner stepped down as the head of CMS in February, where she led federal efforts to implement the Affordable Care Act and the healthcare.gov website. Tavenner will now lead lobbying efforts for AHIP, the trade group which represents numerous major insurance companies including Aetna, Anthem, and Humana. AHIP’s former CEO of 22 years, Karen Ignani, recently left to become President of EmblemHealth. AHIP’s press release announcing Tavenner’s hire can be found HERE.

CMS Releases 2014 Actuarial Report for Medicaid
On July 10, the Centers for Medicare and Medicaid Services’ (CMS) Office of the Actuary released the 2014 Actuarial Report on the Financial Outlook for Medicaid. Based on the ACA’s expansion, the report examines the effects of the 5.7 million newly eligible adults in Medicaid. Findings indicate that the average new beneficiary cost in 2014 is estimated to be $5,517, approximately $1,000 more than the cost for adults that are not newly eligible. Original projections anticipated that the expansion population would cost one percent less than those who were not newly eligible. The report also presents an analysis of past Medicaid trends and 10-year projections of expenditures and enrollment. Read the full report HERE.

PDUFA and MDUFA Reauthorizations Begin With Public Meetings
This week the Food and Drug Administration (FDA) received input from various stakeholders representing patients, healthcare professionals, and the regulated industry on the reauthorization of the Prescription Drug User Fee Act (PDUFA) and Medical Device User Fee Act (MDUFA). Both PDUFA and MDUFA expire under current legislative authority in September 2017. Industry representatives weighed in on ways to further facilitate successes and address failures in the programs. More information on the PDUFA Meeting can be found HERE.  More information on the MDUFA Meeting can be found HERE.

Senate Finance Hearing Reviews HealthCare.gov Controls
On Thursday, July 16, the Senate Finance Committee held a hearing to review the HealthCare.gov Controls, which had been under investigation from the Director of Audit Services at the Government Accountability Office (GAO), Seto Bagdoyan, who testified at the hearing. The undercover investigation sought to determine how the federal health insurance exchange handles fraudulent applications. In his opening remarks, Chairman Orrin Hatch (R-UT) noted the recent GAO report proved that no measures had been taken to fix the issues since last year’s GAO report that identified 11 out of 12 fake applications created by the GAO for testing purposes were approved. Bagdoyan voiced a similar opinion stating that the investigation poses serious concerns due to the ability of fictitious applicants to receive coverage and to even be reinstated after the exchange had already terminated them. Bagdoyan even went as far to say that HealthCare.gov places a higher incentive to get people covered than to verify the legality of the benefits. While Ranking Member Ron Wyden (D-OR) downplayed the claims because there were no real people consuming benefits through the fake applications, Senators John Thune (R-SD) and Dan Coats (R-IN) believe this report deserves more attention from the Committee. The hearing can be found HERE.  The recent GAO Report can be found HERE.

White House Issues Proposed Privacy and Trust Principles for the Precision Medicine Initiative
Published on July 8, the White House issued the Precision Medicine Initiative: Proposed Privacy and Trust Principles. The Precision Medicine Initiative (PMI) is a group comprised of members from the White House Office of Science and Technology Policy, the Department of Health and Human Services Office for Civil Rights, and the National Institutes of Health. PMI’s goal is to support research, technology, and policies that drive the development of individualize treatments. The initiative is federally funded by a $215 million investment under the 2016 budget. The Proposed Principles intend to guide the collection of big data, analysis, and sharing, while maintaining the privacy of protected health information (PHI) gathered from patients. Comments on the Proposed Principles are due on August 7, 2015. The complete PMI document is available HERE.

House GOP Lawmakers Introduce ‘Right to Try’ Legislation
On Thursday, July 9, Representatives Matt Salmon (R-AZ), Paul Gosar (R-AZ), and Marlin Stutzman (R-IN), introduced H.R. 3012, the Right to Try Act of 2015. The legislation largely mirrors ‘Right to Try’ laws seen in twenty-two states, which provide patient access to unapproved, investigational drugs. State action has been championed by The Goldwater Institute, which says that the laws are limited to terminally ill patients with no other treatment options and to drugs which pass basic safety standards. Opponents of the legislation argue the Food and Drug Administration’s (FDA) existing expanded access program provides a safe and consistent avenue for patients seeking access to drugs under development, and that the proposed law would restrict FDA’s authority to enforce basic safety and efficacy standards. Opponents also note the House-passed 21st Century Cures Act includes a section improving the expanded access program. Text of the legislation can be found HERE.

Energy & Commerce Oversight Subcommittee Holds Hearing on Medicare Part D
On Tuesday, July 14, the Energy & Commerce Oversight Subcommittee held a hearing entitled, “Medicare Part D: Measures Needed to Strengthen Program Integrity.” Witnesses at the hearing included Ann Maxwell from the Department of Health and Human Services’ (HHS) Office of Inspector General (OIG) and Shantanu Agrawal from the Center for Program Integrity at the Centers for Medicare and Medicaid Services (CMS). Subcommittee Chairman Tim Murphy (R-PA) highlighted the Committee’s concerns that CMS has failed to implement OIG recommendations to better oversee the Medicare Part D program, which has seen high levels of fraud and abuse in recent years. Murphy and Subcommittee Ranking Member Diana DeGette (D-CO) also raised concerns that Part D fraud could be contributing to opioid abuse. Deputy Administrator Agrawal testified that CMS has taken substantial steps to implement OIG’s recommendations, but did not give a timeline as to when all recommendations would be adopted. A full recording of the hearing can be found HERE.

Representatives Blackburn and Price Introduce ICD-10 Legislation
On Wednesday, July 15, Representatives Marsha Blackburn (R-TN) and Tom Price, MD (R-GA) introduced H.R.3018, the Coding Flexibility in Healthcare Act of 2015 (Code-FLEX). The legislation would allow providers to submit claims using either ICD-9 or ICD-10 codes for six months after the ICD-10 implementation deadline, set for October 1. The bill would also require the Department of Health and Human Services (HHS) to report to Congress three months after the implementation of ICD-10 on how the new codes are affecting providers, patients, and other stakeholders. Last week, the Centers for Medicare and Medicaid Services (CMS) announced a one-year grace period during which it will continue to pay claims even if they use non-specific ICD-10 codes. Text of the legislation can be found HERE.

Senate Appropriation Committee Passes FY2016 Agriculture-FDA Appropriation Bill
On Thursday, July 16, the Senate Appropriations Committee approved the Fiscal Year 2016 Agriculture, Rural Development, Food and Drug Administration (FDA), and Related Agencies Appropriations Bill on a bipartisan 28-2 vote. The proposed legislation grants funding for essential agriculture programs as well as funding for the FDA. The bill totals $143.8 billion and includes $20.51 billion in discretionary funding. Furthermore, the bill provides more than $2.6 billion in discretionary funding for the FDA, an increase of $40 million over the FY2015 enacted level. Total funding for the FDA, including revenue from user fees, is $4.6 billion – $116 million above FY2015 level. The bill’s discretionary funding, not including user fees, for FDA’s review centers is broken down below:
• $1,366,975,000 for the Center for Drug Evaluation and Research (CDER)
• $424,635,000 for the Center for Devices and Radiological Health (CDRH)
• $345,190,000 for the Center for Biologics Evaluation and Research (CBER)

The bill can be found HERE.

CMS Fraud Detection System Identifies and Prevents $820 million in Improper Medicare Payments    On July 14, the Centers for Medicare and Medicaid Services (CMS) released findings regarding the Fraud Prevention System. Created in 2010 under the Small Business Jobs Act, the Fraud Prevention System helps protect the Medicare Trust Fund and prevents fraud. During its first three years, the system identified or prevented $820 million inappropriate payments. Operating on predictive analytics, the Fraud Prevention System helps identify questionable billing patterns in real time and analyze past payments that may indicate fraud. The tool has contributed to the $25 billion recovered from fraudulent or potentially fraudulent activities to the Medicare Trust Fund in the past five years. Find the full press release HERE.

CBO Releases Presentation On Long Term Budget Outlook
On July 14th, the Congressional Budget Office (CBO) gave a presentation on the 2015 Long Term Budget Outlook, based on its full report published in June. The presentation provides key points of the CBO’s findings, including the projected growth in federal spending for major healthcare programs and social security. The report indicates that due to the rising age of consumers, greater spending per capita, and an increasing eligible population for subsidies and Medicaid, spending for the government’s major healthcare programs could rise up to 14.2 percent of the GDP by 2014 if the current law remains. The presentation can be found HERE and the original CBO report is available HERE.