November 15, 2023
Health Policy Report – November 15, 2023
Rep. Jodey Arrington Speaks at The US Oncology Network’s National Policy Board Meeting
House Budget Committee Chairman Jodey Arrington participated in a fireside chat with Dr. Debra Patt, MD, PhD, MBA of Texas Oncology and Ben Jones, Vice President of Government Relations and Public Policy, during The Network’s Fall National Policy Board Leadership Meeting in Houston, TX on Friday, November 10. Rep. Arrington is the lead sponsor of H.R. 4473, the Medicare Patient Access to Cancer Treatment Act, which would require payment parity under Medicare for outpatient cancer services. During the discussion, Rep. Arrington explained how this legislation will reduce health care costs for cancer patients, help level the playing field for community oncology, and save taxpayer dollars—a triple win.
The Network presented him with the “Heroes Who Conquer Cancer Award” for his work on behalf of community cancer and he received a standing ovation. Rep. Arrington represents the 19th district of Texas, which includes Abilene and Lubbock, and, in addition to helming the House Budget Committee, he also serves on the House Ways and Means Committee.
House Passes Funding Bill to Avert Government Shutdown
On Tuesday, November 14, the House passed legislation to fund the federal government and prevent a shutdown ahead of the deadline on November 17. The bill will fund a subset of government agencies through January 19 and the remainder through February 2, setting up two more funding fights in early 2024. The bill passed 336-95 with 2 Democrats and 93 Republicans voting against the bill.
House Speaker Mike Johnson had to rely on Democrats to pass the bill as Republicans opposed the lack of policy riders and spending cuts, indicating a tough road ahead in 2024. The funding bill now heads to the Senate where it is expected to pass before the end of the week. Both Majority Leader Chuck Schumer (D-NY) and Minority Leader Mitch McConnell (R-KY) have signaled their support for the bill.
To read the text of the Continuing Resolution, CLICK HERE.
To read more, CLICK HERE.
CMS Releases PFS Final Rule for CY 2024
On Thursday, November 2, the Centers for Medicare & Medicaid Services (CMS) released its Medicare Physician Fee Schedule (PFS) final rule for 2024, which includes continued cuts for doctors.
Overall, the CY 2024 PFS conversion factor was finalized at $32.74 resulting in a decrease of $1.15 or 3.39% from 2023. This change also accounts for the one-time 1.25% increase for 2024 provided by the Consolidated Appropriations Act of 2023 (CAA) passed at the end of the year in 2022. In the rule, CMS finalized a 2% cut to reimbursement for radiation therapy and a 4% cut for interventional radiology.
CMS also finalized the implementation of a separate add-on payment for healthcare common procedure coding system (HCPSCS) code G2211 that goes into effect January 1, 2024. The add-on code will recognize the resource costs associated with Evaluation and Management (E/M) visits for primary care and longitudinal care. This add-on code cannot be billed with a modifier that denotes an office and outpatient E/M visit that is itself focused on a procedure or other service instead of being focused on longitudinal care for all needed healthcare services, or a single, serous or complex condition. CMS estimates that when fully adopted, G2211 will be billed with 54% of all Office/Outpatient (O/O) E/M visits.
The cuts finalized by CMS for 2024 follow a 2% payment reduction for physicians in 2023. In its comments to the proposed rule, The Network expressed concern with year after year cuts to the Physician Fee Schedule, while the Hospital Outpatient Prospective Payment System continues to see increases, furthering site-of-service payment disparities and incentives for consolidation. “Increasing payment to hospital-owned physician offices while decreasing payment to independently-owned physician offices increases costs in the short and long term to patients and the Medicare system,” The Network wrote.
American Medical Association (AMA) data show that Medicare reimbursement to the nation’s doctors has fallen by 26% from 2001 to 2023 when accounting for inflation. Currently, Medicare’s physician pay rates are not tied to the Medicare Economic Index (MEI), which is linked to inflation.
Physician groups were quick to express concern about the cuts and their impact on the stability of physician practices. “The declining revenues in the face of steep cost increases disproportionately affect small, independent, and rural physician practices, as well as those treating low-income or other historically minoritized or marginalized patient communities,” Dr. Jesse Ehrenfeld, president of the AMA.
To read the MPFS Final Rule for 2024, CLICK HERE.
To read The Network’s comments on the proposed rule, CLICK HERE.
To read more about the issue, CLICK HERE.
CMS Releases Hospital Outpatient Prospective Payment System Final Rule and 340B Pay Remedy
On Thursday, November 2, the Centers for Medicare and Medicaid Services (CMS) released the final rules for the Hospital Outpatient Prospective Payment System (OPPS) and 340B Pay Remedy. Though CMS initially proposed a 2.8% payment increase for 2024, the OPPS final rule provided a 3.1% increase, which the agency said is based on a projected market basket percentage of 3.3%. CMS also finalized several changes around price transparency for hospitals in the rule, including requiring hospitals to make cost data publicly available through standardized methods and streamlining price transparency enforcement.
However, CMS did not finalize the buffer stock reimbursement proposal, which would hike reimbursement for hospitals that stockpile “buffer” supplies of essential medicines, and instead noted that it would issue a separate notice and comment rulemaking proposal at a later date.
Various stakeholder groups, including the American Hospital Association (AHA), had raised strong concerns with the proposal, noting that this approach would impose cost burdens on smaller hospitals and wouldn’t resolve underlying supply chain issues. In its comments on the proposed rule, The Network noted its concern with any policy that would encourage stockpiling in one setting and lead to shortages in another. “If CMS decides to create separate payment for establishing and maintaining a buffer stock of drugs used in the treatment of cancer in the inpatient or outpatient setting, the agency should create a similar payment to establish and maintain a buffer stock in the physician office setting,” the Network wrote in its letter.
Meanwhile, CMS issued the final 340B Pay Remedy, which will grant providers participating in the 340B drug pricing program a one-time lump-sum payment to offset losses between 2018 and 2022 totaling $9 billion to 1,700 340B covered entities. The remedy also includes a policy to recoup funds from hospitals that received increased rates for non-drug services from 2018 to 2022. In response, the American Hospital Association (AHA) expressed satisfaction with the lump-sum payment but decried the agency’s decision to claw back payments in the coming years, noting that it would pursue all available options moving forward.
To read the OPPS Final Rule for 2024, CLICK HERE.
To read a fact sheet on the OPPS Final Rule for 2024, CLICK HERE.
To read The Network’s comments on the OPPS proposed rule, CLICK HERE.
To read the 340B Pay Remedy final rule, CLICK HERE.
To read AHA’s reaction to the 340B Pay Remedy Final Rule, CLICK HERE.
To read more, CLICK HERE.
House Energy & Commerce Health Subcommittee to Hold Markup
On Wednesday, November 15, the House Energy & Commerce Health Subcommittee will hold a markup on policies to improve patient access to care and support providers, including legislation on physician reimbursement, home infusion, and regulation of pharmacy benefit managers (PBMs).
The subcommittee is scheduled to discuss H.R. 5397, the Joe Fiandra Access to Home Infusion Act of 2023, which would ensure that home infusion treatments are covered under Medicare benefits. Meanwhile, lawmakers are also set to review multiple bills relating to PBMs, including H.R. 5385, the Medicare PBM Accountability Act, which would require PBMs to disclose price negotiations and rebate information and H.R. 2880, the Protecting Patients Against PBM Abuses Act, which would delink PBM compensation from the cost of medications, ban patient steering and spread pricing, and increase transparency.
Physician reimbursement is again included in discussions with the recent publication of The Centers for Medicaid and Medicare Services (CMS) Medicare Physician Fee Schedule (PFS) Final Rule where physicians are facing another cut. The subcommittee will be markup the discussion draft of H.R. 6371, the Provider Reimbursement Stability Act of 2023 which would provide an increase to the PFS budget neutrality threshold and provide a lookback period to reconcile overestimates and underestimates of pricing adjustments for individual services.
The markup is scheduled for 10 a.m. ET and should highlight the direction the House will go as they work on their end of year legislative priorities.
To learn more about the markup, CLICK HERE.
Court Ruling Broadens Definition of “Patient” Under 340B Program
On November 3, a South Carolina district judge ruled that the Health and Services Administration’s (HRSA) interpretation of a “patient” is unfairly narrow, limiting those eligible for 340B discounts.
In the case, Genesis Healthcare, Inc. v. Becerra, the judge ruled that HRSA’s interpretation of what a “patient” is was inconsistent with the plain language of the 340B statute and the intent of Congress in passing the statute. HRSA currently interprets the “patient” of a 340B-eligible entity to mean that the covered entity must have “initiated the healthcare service resulting in the prescription.” Genesis argued, however, that they could resell 340B drugs to patients even if the prescription didn’t originate from the covered entity or one of its contract providers.
The decision has the potential to upend 340B program operations and allow broader use of 340B drugs. This could raise questions about HRSA’s ability to oversee the program and invite further calls for Congress to improve HRSA’s authority over the program.
“It is not the role of HRSA to legislate and limit the 340B program by restricting the definition of the term ‘patient,’ thereby frustrating the ability of the 340B statute to accomplish its purpose,” the judge wrote in the decision.
To read more, CLICK HERE.
Medicare Implements Price Transparency Requirements for Hospitals
The federal government has announced that it will move forward with proposals that require hospitals to improve how they publish the prices they charge to health insurers and patients.
Though hospitals have been required to post their prices since 2021, compliance has been limited and pricing information is still difficult to access. However, a new regulation included in the OPPS final rule will streamline reporting and require hospitals to use a standard template to make the information more uniform and understandable. Further, the government will start publicizing transparency compliance, and penalty history, and will add more categories for hospitals to report on, including the price that the hospital has historically received from a third-party payer for an item or service.
To read more, CLICK HERE.
Senate Committee Holds Markup on Wide-Ranging Health Package
On Wednesday, November 8th, the Senate Finance Committee unanimously voted to refer the Better Mental Health Care, Lower-Cost Drugs, and Extenders Act of 2023 to the full Senate. The bill seeks to scale back physician pay cuts, delay pending reductions in Medicaid disproportionate share hospital funding for safety-net facilities through 2026 and impose new rules on PBMs and health companies.
Numerous health reforms, including site-neutral pay and graduate medical education reforms weren’t included in the bill. However, during the markup, Chairman Ron Wyden (D-OR) noted that there is “credible evidence” of hospitals charging more for the same service in different settings. Ranking Member Mike Crapo (R-ID) agreed and stated that the committee will be working on how to proceed in light of these findings.
Ahead of the markup, stakeholders urged lawmakers to act on provider pay and incentive bonus payments, with more than 50 provider groups urging lawmakers to mitigate the entire 3.4% conversion factor laid out in the final 2024 Medicare physician fee schedule.
The committee’s support for PBM reform follows a slew of bills that have been advanced by numerous House and Senate committees that include provisions such as limits or bans on spread pricing and delinking PBM compensation from drug prices. The widespread support for these policies suggests that Congress may finalize a bill before the year ends, depending on the path forward to avert a government shutdown.
To read the discussion draft, CLICK HERE.
To watch the markup, CLICK HERE.
Senate Confirms Dr. Monica Bertagnolli as NIH Director
On Tuesday, November 7th, the Senate confirmed the nomination of Monica Bertagnolli, a longtime cancer physician, as the next director of the National Institutes of Health in a 62-36 vote. Bertagnolli currently leads the National Cancer Institute.
President Biden announced in May that he would nominate Dr. Bertagnolli to lead the NIH, which had been without a permanent director since Dr. Francis S. Collins stepped down nearly two years ago. Bertagnolli’s confirmation faced a months-long delay as Senator Bernie Sanders (I-VT), held up the hearing to urge the Biden administration to take more aggressive action to lower drug prices. However, the Senate Health, Education, Labor, and Pensions (HELP) Committee advanced Bertagnolli to the full Senate on Wednesday, October 25th.
Following Tuesday’s bipartisan vote, the Biden administration emphasized that the broad support for NIH’s new leader would empower the agency. “I have no doubt she will reimagine the boundaries of what is possible when it comes to what the NIH can achieve,” Health and Human Services Secretary Xavier Becerra said in a statement.
To read more, CLICK HERE.
To read HHS Secretary Xavier Becerra’s statement following the vote, CLICK HERE.