HHS finalizes revised dispute resolution process for 340B program

https://www.kaufmanhall.com/insights/blog/gist-weekly-april-26-2024

Late last week, the Department of Health and Human Services (HHS) published a final rule establishing a new administrative dispute resolution process for the 340B drug discount program.

A panel, composed of government experts from the Office of Pharmacy Affairs, will resolve claims raised by covered entity providers about drugmakers overcharging them for 340B drugs, as well as claims from pharmaceutical companies that covered entities are diverting or duplicating discounts improperly. The new process, which will go into effect in mid-June, allows the panel to review claims on issues related to those pending in federal court. It’s intended to be “more accessible, administratively feasible, and timely” than a prior process established by HHS in 2020 that was paused after legal challenges.

The Gist: 

This new 340B dispute resolution process is likely to see extensive use, as battles between providers and drugmakers over the drug discount program have heated up significantly in recent years. There are more than 50 ongoing court cases related to the program, many of which concern actions taken by at least 20 major drugmakers to restrict 340B sales to contract pharmacies. Although this new process may provide more effective dispute resolution, none of its decisions can be considered final until courts have settled the myriad cases before them.

    Indiana system to pay $345M in case tied to physician pay

    Indianapolis-based Community Health Network has agreed to a $345 million settlement to resolve allegations that, dating back to 2008, it violated the False Claims Act and Stark law.

    The settlement, announced Dec. 19, stems from a whistleblower complaint filed in 2014 by the nonprofit health system’s former CFO and COO under the qui tam provisions of the False Claims Act. 

    The United States filed suit against CHN in 2020, alleging that the system violated the False Claims Act by knowingly submitting claims to Medicare for services that were referred in violation of the Stark law, which requires that the compensation of employed physicians be fair market value and cannot account for the volume of referrals. 

    The U.S. complaint alleged that, starting in 2008, CHN’s senior management engaged in a scheme to recruit physicians for employment with outsized pay in an effort to secure profitable referrals. The salaries offered to cardiologists, cardiothoracic surgeons, vascular surgeons, neurosurgeons and breast surgeons for CHN employment were sometimes up to double what physicians earned in private practices, the complaint alleged. 

    The government alleged that CHN provided false compensation information to a valuation firm, ignored the consultants’ warnings about legal risks of overcompensation and awarded bonuses to physicians based on their referrals to providers within the CHN network. 

    CHN said the $345 million settlement will be paid from its reserves, which reported operating revenue of $3.1 billion in 2022. The nonprofit system has more than 200 sites of care and affiliates throughout Central Indiana, including 10 hospitals. 

    “This is completely unrelated to the quality and appropriateness of the care Community provided to patients,” CHN Spokesperson Kris Kirschner said in a statement shared with Becker’s. “This settlement, like those involving other health systems and hospitals, relates to the complex, highly regulated area of physician compensation. Community has consistently prioritized the highest regulatory and ethical standards in all our business processes.” 

    The system said it “has always sought to compensate employed physicians based on evolving industry best practices with the advice of independent third parties” and “has always sought to provide complete and accurate information to our third-party consultants.” 

    “When doctors refer patients for CT scans, mammograms or any other medical service, those patients should know the doctor is putting their medical interests first and not their profit margins,” Zachary Myers, U.S. attorney for the Southern District of Indiana, said in the Justice Department news release. 

    “Community Health Network overpaid its doctors. It also paid doctors bonuses based on the amount of extra money the hospital was able to bill Medicare through doctor referrals,” Mr. Myers said. “Such compensation arrangements erode patient trust and incentivize unnecessary medical services that waste taxpayer dollars.”  

    Under the settlement, CHN will enter into a five-year corporate integrity agreement with HHS in addition to its $345 million payment to the U.S.

    The Broader Policy Implications of the Medicaid Unwinding Crisis

    November 2023 marks seven months since the federal government began unwinding Medicaid’s pandemic-related continuous enrollment guarantee. Because Medicaid coverage is associated with improved access and better health outcomes, stabilizing enrollment throughout the public health emergency was a vital public health measure. Now states must grapple with the challenge of returning to normal operations, which means reviewing eligibility for more than 90 million beneficiaries. 

    By early November, at least 10,135,000 people had been disenrolled. Overall, two-thirds of people had their coverage renewed while about one-third lost eligibility.

    The rate of disenrollment during renewal varies greatly, depending on a state’s underlying Medicaid eligibility rules, capacity to process renewals, and strategies for simplifying the process and reducing risks of error. Illinois showed a disenrollment rate of less than 10 percent, while Florida’s rate was one-third. Disenrollment of children appears to be happening at a high rate, even though they should be protected because of the relatively generous eligibility standards governing children’s coverage under Medicaid and the Children’s Health Insurance Program (CHIP).

    As of November, children’s enrollment was down by 2.2 million. 

    Among those disenrolled, more than 70 percent lost coverage for procedural reasons, like failure to return forms or an inaccurate mailing address. High procedural disenrollments also likely reflect agency error (e.g., miscalculating earnings information), but available data do not track the proportion of procedural disenrollments that result from such mistakes.

    The high procedural disenrollment problem is exacerbated by the speed at which some states are acting — far faster than required under the federal 12-month unwinding timeline allowed by Congress. 

    Compounding matters, anecdotal evidence suggests that people terminated for procedural reasons are also being turned away from the health insurance marketplace because states close cases without determining if beneficiaries are truly ineligible for Medicaid. This is happening even though marketplaces and Medicaid agencies are supposed to coordinate activities to ensure that people losing Medicaid can obtain marketplace coverage if eligible. 

    The numbers are staggering. Texas has disenrolled more than 1.2 million people; Florida’s disenrollments have exceeded 730,000.

    Disenrollment rates are the result of a complex process, excessive speed, and overtasked workers, along with states’ underlying eligibility rules for low-income children and adults. If these rules are more restrictive, they increase the disenrollment rate. In states that have not adopted the Affordable Care Act (ACA) expansion, the potential for major coverage loss is far higher. In nonexpansion states, the rules for poor adults (who had coverage throughout the pandemic, including postpartum women or teenage children who have now reached young adulthood) require an extremely low income level — 16 percent of the federal poverty level in Texas or about $4,000 annually for a family of three in 2023. As stated previously, the disenrollment of children has been far higher than expected, affecting even newborns during the first year of life when enrollment is guaranteed. 

    The ACA streamlined and simplified Medicaid’s historically complex enrollment and renewal process by eliminating in-person interviews, automating data collection functions, and instituting an ex parte process, in which the state performs reviews without placing unnecessary renewal burdens on beneficiaries. In addition, a historic 1970 Supreme Court decision governing due process protections for people receiving means-tested public assistance benefits requires states to fully and comprehensibly explain in writing why coverage is ending and gives beneficiaries the opportunity to contest a termination decision before it takes effect. These constitutional safeguards are especially crucial to Medicaid because termination implicates not only coverage, but access to health care itself. 

    In 2022, long after the ACA simplification reforms were instituted, the U.S. Department of Health and Human Services (HHS) concluded that of the 15 million people estimated to lose Medicaid during the unwinding process, nearly 45 percent would lose coverage because of procedural issues associated with navigating the renewal process. HHS also foresaw that children and younger adults (including very poor parents) would be disproportionately affected. The evidence appears to be bearing both predictions out. 

    The federal government and advocates have begun to take action to mitigate erroneous coverage loss. The 2022 unwinding legislation empowers the HHS Secretary to impose corrective action plans in states showing excessive procedural disenrollments. In states that fail to comply with such plans, HHS would “require the State to suspend . . . terminations of eligibility for medical assistance . . . that are for procedural reasons until the State takes appropriate corrective action.” Under this special power, HHS has urged states to guard against improper disenrollments without an individualized ex parte review and also ordered reinstatement of a half-million children and adults disenrolled simply because other family members were no longer eligible. The agency has ordered states to halt disenrollment until corrective action is taken. 

    In a first-of-its-kind case, beneficiaries in Florida who have lost coverage without required constitutional protections have sued for reinstatement and to halt further disenrollment. Plaintiffs include children (some with serious disabilities) and adults. The complaint describes state notices that are incomprehensible by people with average education and that fail to convey which family members are losing coverage, why coverage is being lost, and the right to a pre-termination hearing. Beneficiaries in other states may follow suit. 

    The current unwinding situation presents a unique challenge for states, health care providers, and above all, millions of beneficiaries who depend on Medicaid. It is important to remember that continuous enrollment enacted during the pandemic was a response to three structural limitations that are part of everyday Medicaid: first, highly restrictive eligibility limits, particularly in states that do not cover low-income working-age adults; second, the lack of annual guaranteed enrollment for all beneficiaries, regardless of age or basis of eligibility; and third, a redetermination process that, despite improvements, continues to face enormous operational challenges. 

    The ACA’s Promise of Free Preventive Health Care Faces Ongoing Legal Challenges

    An ongoing legal challenge is threatening the guarantee of free preventive care in the Affordable Care Act (ACA).

    Six individuals and the owners of two small businesses sued the federal government, arguing that the ACA provision “makes it impossible” for them to purchase health insurance for themselves or their employees that excludes free preventive care. The plaintiffs argue that they do not want or need such care. They specifically name the medication PrEP (used to prevent the spread of HIV), contraception, the HPV vaccine, and screening and behavioral counseling for sexually transmitted diseases and substance use; however, they seek to invalidate the entire ACA preventive benefit package.

    A federal trial court judge agreed with some of their claims and invalidated free coverage of more than 50 services, including lung, breast, and colon cancer screenings and statins to prevent heart disease.

    This ruling, which is currently being appealed, strips free preventive services coverage from more than 150 million privately insured people and approximately 20 million Medicaid beneficiaries who are covered under the ACA’s Medicaid expansion.

    This suit was first filed in 2020. The plaintiffs in the case, Braidwood Management v. Becerra, continue to oppose the entire preventive benefit package, which consists of four service bundles: services rated “A” or “B” by the United States Preventive Services Task Force (USPSTF); routine immunizations recommended by the Advisory Committee on Immunization Practices (ACIP); evidence-informed services for children recommended by the Health Resources and Services Administration (HRSA); and evidence-informed women’s health care recommended by HRSA. The trial judge invalidated all benefits recommended by the USPSTF after March 23, 2010, the date the ACA became law. (The court also exempted the plaintiffs on religious grounds from their obligation to cover PrEP.) The Fifth Circuit put the trial court’s decision on temporary hold while the case is on appeal.

    The Fifth Circuit, one of the nation’s most conservative appeals courts, will hear the Biden administration’s appeal of the trial court’s USPSTF ruling and the entirety of the plaintiffs’ original challenge, thereby putting all four coverage guarantees in play. The court also will hear whether the ruling should apply only to the plaintiffs or to all Americans.

    The trial court held that the USPSTF lacks the legal status necessary under the Constitution to make binding coverage decisions, and that the Secretary of the U.S. Department of Health and Human Services (HHS) — who can make such binding decisions — lacks the power to rectify matters by formally adopting USPSTF recommendations. The judge concluded that federal law fails to require that members be presidential nominees confirmed by the Senate under the Appointments Clause; in the judge’s view, this means that members are not politically accountable for their decisions, which is constitutionally problematic. The judge also ruled that federal law makes the USPSTF the final coverage arbiter, which means that the HHS Secretary, who is nominated and confirmed under the Appointments Clause and thus politically accountable, cannot cure the constitutional problem by ratifying USPSTF recommendations.

    On appeal, the Biden administration argues that the USPSTF passes constitutional muster because the HHS Secretary, who oversees the Task Force, is a nominated and confirmed constitutional officer. Alternatively, the administration argues the appeals court should interpret the statute as allowing the HHS Secretary to ratify USPSTF recommendations, since the law specifies that USPSTF members are independent of political pressure only “to the extent practicable.” The administration makes similar arguments on behalf of ACIP and HRSA.

    The plaintiffs argue that secretarial ratification cannot cure the constitutional problems with all three advisory bodies. According to the plaintiffs, none of the advisory bodies has the status of constitutional officers demanded by the Appointments Clause, and so their recommendations must remain recommendations only, unenforceable by HHS on insurers, health plans, and state Medicaid programs.

    The second issue is the scope of the remedy if the law is found unconstitutional. The trial court did not limit its holding to the four individual plaintiffs and two companies who sued, but instead applied its order nationwide. The Biden administration argues that, if the coverage guarantee is unconstitutional, the court only should prohibit HHS from enforcing the preventive services provision against the plaintiffs who brought the lawsuit and should allow the coverage guarantee to remain in force for the rest of the country. Citing an amicus brief filed by the American Public Health Association and public health deans and scholars, the administration argues that barring HHS from enforcing the preventive services requirement nationwide “pose[s] a grave threat to the public health” by decreasing Americans’ access to lifesaving preventive services. The plaintiffs argue that a nationwide prohibition is necessary, the broader public interest in free preventive coverage is irrelevant, and insurers will voluntarily continue to offer free preventive coverage if people want it.

    The administration’s arguments on appeal have attracted amicus briefs by bipartisan economic scholars, organizations concerned with health equity and preventive health, health care organizations, and 23 states.

    Crucially, the economists point out that, prior to the ACA, comprehensive free preventive coverage was extremely limited because it is not in insurers’ interest to make a long-term economic investment in members’ health. Indeed, prior to the ACA, insurers did not even uniformly cover the basic screenings for newborns to detect treatable illnesses and conditions.

    Amicus briefs supporting the plaintiffs have been filed by Texas and an organization dedicated to “protecting individual liberties . . . against government overreach.” All briefing will be complete by November 3, 2023, with oral argument thereafter. A decision is likely in early to mid-2024. Whatever the outcome, expect a Supreme Court appeal given the size of the stakes in the case.

    GOP allies drawing up health plans for a Republican administration

    Influential conservative policy groups are sketching out health care plans for a potential Republican administration over a year before the election.

    Why it matters: 

    Republicans have moved on from the “repeal and replace” — the Affordable Care Act didn’t even get a mention in the first GOP presidential debate last week — but still haven’t settled on new health care agenda.

    • Republican-aligned groups are stepping in to build out ideas for a party platform that may not be as ambitious as an ACA replacement but could still shift health care policy in a conservative direction on everything from Medicaid to abortion to public health.

    Context: 

    The early push to define the next GOP health agenda partly stems from Republicans’ inability to agree on an ACA alternative after former President Trump was elected, despite years of promises to overhaul the 2010 health care law. The GOP policy experts also said they want to avoid repeating the Trump administration’s failure to plan health care executive actions and key staffing decisions before taking office.

    • “A large part of it comes from the experience of 2017. There wasn’t a clear agenda that was ready to go,” said Brian Blase, a former Trump administration health official who’s now president of the right-leaning Paragon Health Institute.

    Details: 

    Conservative think tanks are looking to advance some long-held conservative goals like transforming Medicaid’s open-ended entitlement into block grants, but there’s also a new generation of Trump alumni who hope to revive some of his administration’s policies.

    • These include initiatives like encouraging businesses to form association health plans, and pushing even further on price transparency and curbing higher payments to hospitals’ outpatient departments.
    • Some are also drawing up plans for limiting the CDC’s power over public health policy in reaction to what they view as the agency’s failed response to the COVID-19 pandemic.

    Zoom in: 

    Paragon Health, as well as the Heritage Foundation and America First Policy Institute, are the primary conservative think tanks now drafting health regulations, policy plans and recruiting personnel who could serve in a Republican administration.

    • A roadmap from Paragon envisions a burst of rulemaking at the beginning of a new administration, mostly through the Department of Health and Human Services.

    Meanwhile, the America First Policy Institute, founded by Trump administration alumni in 2021, has put forward a 12-part health policy agenda it describes as “radical incrementalism.”

    • That’s an acknowledgement that they’re not planning a major health care overhaul, but a belief that significant changes are possible in the current structure, said former Louisiana Gov. Bobby Jindal, who chairs the group’s health policy division.
    • “We are advocating specific policies that try to reform our health care system in a very specific direction that empowers patients … that makes health care more affordable, accessible, that improves outcomes by giving control back to individual patients working with their providers, not government agencies and programs. But, we’re not trying to write the next 3,000-page bill,” Jindal said.
    • Some of those incremental ideas they hope could get bipartisan support, such as broadening health savings accounts for those with chronic conditions, expanding telehealth flexibilities for providers across state lines, implementing transparency for pharmacy benefit managers and speeding up deployment of biosimilars.

    The Heritage Foundation has also detailed policy proposals and recently joined more than 70 other conservative groups to launch an initiative called Project 2025 to develop a governing agenda.

    • One of those Heritage policy proposals laid out earlier this year illustrates how a future GOP president could overhaul HHS.
    • Heritage’s plan contains the most detailed ideas for how the next GOP president — who would be the first since the demise of Roe v. Wade — could implement anti-abortion policies, cut off Medicaid funding to Planned Parenthood, and roll back Biden administration initiatives aimed at increasing access to abortion.
    • The group also envisions splitting CDC into two agencies — one for research and data collection and another for making public health recommendations with “severely confined ability” to influence policy.

    What we’re watching: The GOP presidential candidates themselves have said relatively little so far about their plans for the health care system. That could eventually change, given Americans’ concern over health care costs.

    American healthcare: The good, bad, ugly, future

    https://www.linkedin.com/pulse/american-healthcare-good-bad-ugly-future-robert-pearl-m-d-/

    Albert Einstein determined that time is relative. And when it comes to healthcare, five years can be both a long and a short amount of time.

    In August 2018, I launched the Fixing Healthcare podcast. At the time, the medium felt like the perfect auditory companion to the books and articles I’d been writing. By bringing on world-renowned guests and engaging in difficult but meaningful discussions, I hoped the show would have a positive impact on American medicine. After five years and 100 episodes, now is an opportune time to look back and examine how healthcare has improved and in what ways American medicine has become more problematic.

    Here’s a look at the good, the bad and the ugly since episode one of Fixing Healthcare:

    The Good

    Drug breakthroughs and government actions headline medicine’s biggest wins over the past five years.

    Vaccines

    Arguably the most massive (and controversial) healthcare triumph over the past five years was the introduction of vaccines, which proved successful beyond any reasonable expectation.

    At first, health experts expressed doubts that Pfizer, Moderna and others could create a safe and effective Covid-19 vaccine with messenger RNA (mRNA) technology. After all, no one had succeeded in more than two decades of trying.

    Thanks in part to Operation Warp Speed, the government-funded springboard for research, our nation produced multiple vaccines within less than a year. Previously, the quickest vaccine took four years to develop (mumps). All others required a minimum of five years.

    The vaccines were pivotal in ending the coronavirus pandemic, and their success has opened the door to other life-saving drugs, including those that might prevent or fight cancer. And, of course, our world is now better prepared for when the next viral pandemic strikes.

    Weight-Loss Drugs

    Originally designed to help patients manage Type 2 diabetes, drugs like Ozempic have been helping people reverse obesity—a condition closely correlated with diabetes, heart disease and cancer.

    For decades, America’s $150 billion a year diet industry has failed to curb the nation’s continued weight gain. So too have calls for increased exercise and proper nutrition, including restrictions on sugary sodas and fast foods.

    In contrast, these GLP-1 medications are highly effective. They help overweight and obese people lose 15 to 25 pounds on average with side effects that are manageable for nearly all users.

    The biggest stumbling block to their widespread use is the drug’s exorbitant price (upwards of $16,000 for a year’s supply).

    Drug-Pricing Laws

    With the Inflation Reduction Act of 2022, Congress took meaningful action to lower drug prices, a move the CBO estimates would reduce the federal deficit by $237 billion over 10 years.

    It’s a good start. Americans today pay twice as much for the same medications as people in Europe largely because of Congressional legislation passed in 2003.

    That law, the Medicare Prescription Drug Price Negotiation Act, made it illegal for  Health and Human Services (HHS) to negotiate drug prices with manufacturers—even for the individuals publicly insured through Medicare and Medicaid.

    Now, under provisions of the new Inflation Reduction Act, the government will be able to negotiate the prices of 10 widely prescribed medications based on how much Medicare’s Part D program spends. The lineup is expected to include prescription treatments for arthritis, cancer, asthma and cardiovascular disease. Unfortunately, the program won’t take effect until 2026. And as of now, several legal challenges from both drug manufacturers and the U.S. Chamber of Commerce are pending.

    The Bad

    Spiking costs, ongoing racial inequalities and millions of Americans without health insurance make up three disappointing healthcare failures of the past five years.

    Cost And Quality 

    The U.S. spends nearly twice as much on healthcare per citizen as other countries, yet our nation lags 10 of the wealthiest countries in medical performance and clinical outcomes. As a result, Americans die younger and experience more complications from chronic diseases than people in peer nations.

    As prices climb ever-higher, at least half of Americans can’t afford to pay their out-of-pocket medical bills, which remain the leading cause of U.S. bankruptcy. And with rising insurance premiums alongside growing out-of-pocket expenses, more people are delaying their medical care and rationing their medications, including life-essential drugs like insulin. This creates a vicious cycle that will likely prolong today’s healthcare problems well into the future.

    Health Disparities

    Inequalities in American medicine persist along racial lines—despite action-oriented words from health officials that date back decades.

    Today, patients in minority populations receive unequal and inequitable medical treatment when compared to white patients. That’s true even when adjusting for differences in geography, insurance status and socioeconomics.

    Racism in medical care has been well-documented throughout history. But the early days of the Covid-19 pandemic provided several recent and deadly examples. From testing to treatment, Black and Latino patients received both poorer quality and less medical care, doubling and even tripling their chances of dying from the disease.

    The problems can be observed across the medical spectrum. Studies show Black women are still less likely to be offered breast reconstruction after mastectomy than white women. Research also finds that Black patients are 40% less likely to receive pain medication after surgery. Although technology could have helped to mitigate health disparities, our nation’s unwillingness to acknowledge the severity of the problem has made the problem worse.

    Uninsurance

    Although there are now more than 90 million Americans enrolled in Medicaid, there are still 30 million people without any health insurance. This disturbing reality comes a full decade after the passage of the Affordable Care Act.

    On Capitol Hill, there is no plan in place to reduce the number of uninsured.

    Moreover, many states are looking to significantly rollback their Medicaid enrollment in the post-Covid era. Kaiser Family Foundation estimates that between 8 million and 24 million people will lose Medicaid coverage during the unwinding of the continuous enrollment provisions implemented during the pandemic. Without coverage, people have a harder time obtaining the preventive services they need and, as a result, they suffer more chronic diseases and die younger.

    The Ugly

    An overall decrease in longevity, along with higher maternal mortality and a worsening mental-health crisis, comprise the greatest failures of U.S. healthcare over the past five years.

    Life Expectancy

    Despite radical advances in medical science over the past five years, American life expectancy is back to where it was at the turn of the 20th century, according to CDC data.

    Alongside environmental and social factors are a number of medical causes for the nation’s dip in longevity. Research demonstrated that many of the 1 million-plus Covid-19 deaths were preventable. So, too, was the nation’s rise in opioid deaths and teen suicides.

    Regardless of exact causation, Americans are living two years less on average than when we started the Fixing Healthcare podcast five years ago.

    Maternal Mortality

    Compared to peer nations, the United States is the only country with a growing rate of mothers dying from childbirth. The U.S. experiences 17.4 maternal deaths per 100,000 live births. In contrast, Norway is at 1.8 and the Netherlands at 3.0.

    The risk of dying during delivery or in the post-partum period is dramatically higher for Black women in the United States. Even when controlling for economic factors, Black mothers still suffer twice as many deaths from childbirth as white women.

    And with growing restrictions on a woman’s right to choose, the maternal mortality rate will likely continue to rise in the United States going forward.

    Mental Health

    Finally, the mental health of our country is in decline with rates of anxiety, depression and suicide on the rise.

    These problems were bad prior to Covid-19, but years of isolation and social distancing only aggravated the problem. Suicide is now a leading cause of death for teenagers. Now, more than 1 in every 1,000 youths take their own lives each year. The newest data show that suicides across the U.S. have reached an all-time high and now exceed homicides.

    Even with the expanded use of telemedicine, mental health in our nation is likely to become worse as Americans struggle to access and afford the services they require.

    The Future

    In looking at the three lists, I’m reminded of a baseball slugger who can occasionally hit awe-inspiring home runs but strikes out most of the time. The crowd may love the big hitter and celebrate the long ball, but in both baseball and healthcare, failing at the basics consistently results in more losses than wins.

    Over the past five years, American medicine has produced a losing record. New drugs and surgical breakthroughs have made headlines, but the deeper, more systemic failures of American healthcare have rarely penetrated the news cycle.

    If our nation wants to make the next five years better and healthier than the last five, elected officials and healthcare leaders will need to make major improvements. The steps required to do so will be the focus of my next article.

    CMS proposes $9B repayment to 340B hospital participants

    https://mailchi.mp/cc1fe752f93c/the-weekly-gist-july-14-2023?e=d1e747d2d8

    Earlier this week, the Centers for Medicare and Medicaid Services (CMS) issued a proposal to remedy its four years of payment cuts to the more than 1,600 hospitals participating in the 340B Drug Pricing Program through one-time, lump-sum payments that will total roughly $9B. 

    In 2018, CMS reduced drug reimbursement to 340B covered-entity hospitals by nearly 30 percent, in an attempt to align reimbursement with hospitals’ actual drug acquisition costs. The Supreme Court overturned those cuts in 2022, ruling that the Department of Health and Human Services (HHS) had violated rulemaking procedure. As CMS rulemaking on Medicare payment must be budget-neutral, the agency will offset the remedy payments with a 0.5 percent cut to all hospitals for non-drug items and services covered under the Hospital Outpatient Prospective Payment System (OPPS) over the next 16 years. Stakeholders have until September 5th to comment on the proposed rule. Once the final rule is published later this year, CMS plans to repay 340B participant hospitals within 60 days of their application for remedy.

    The Gist: After worries about how last year’s Supreme Court ruling would be implemented, 340B participant hospitals will be relieved to receive their payment corrections up front instead of over time, especially given current margin challenges.

    But while this issue is now set to be resolved, other critical decisions about the 340B program’s fate are pending before courts. Earlier this year, Bayer and EMD Serono became the 20th and 21st drugmakers to restrict discounts to contract pharmacies, following an appellate court decision in January that sided with the pharmaceutical manufacturers.

    Meanwhile, appellate courts in other jurisdictions are set to hear at least two more cases on the issue, amid conflicting rulings about whether HHS can enforce contract pharmacy discounts.

    Health panel recommends anxiety screening for all adults under 65

    https://mailchi.mp/edda78bd2a5a/the-weekly-gist-june-23-2023?e=d1e747d2d8

     On Tuesday, the US Preventative Services Task Force (USPSTF), which is appointed by an arm of the Department of Health and Human Services, finalized guidance that all adults ages 19 to 64 should be routinely screened for anxiety, even in the absence of symptoms. Last fall, USPSTF proposed a draft version of this guidance, and also finalized its recommendation that children and adolescents ages 8-18 be screened for anxiety. The task force found that anxiety screening for seniors, as well as suicide-risk screening for all adults, lacked conclusive evidence of effectiveness.

    The Gist: Policymakers and providers are right to respond to the nationwide increase in anxiety and depression brought on by the pandemic, and regular screenings will help quantify the scope of a problem we face.

    However, given the pervasive undersupply of behavioral health practitioners, widespread screenings will only lead to better care if access to treatment can be scaled. 

    Solutions that take advantage of telemedicine’s success in behavioral health, combined with the tools—and time—to manage mild anxiety in the primary care setting, are critical to provide support for a coming wave of newly identified patients. 

    Biden administration proposes overhaul of organ transplant system

    https://mailchi.mp/6f4bb5a2183a/the-weekly-gist-march-24-2023?e=d1e747d2d8

    On Wednesday, the Health Resources and Services Administration (HRSA), a division of the Department of Health and Human Services, announced plans to modernize the US organ transplant system. For 40 years, the United Network for Organ Sharing (UNOS) has held an exclusive contract to facilitate the retrieval, matching, and distribution of all transplanted organs, handling a record 43K transplants last year. 

    Starting this fall, HRSA will split out contracts and open the bidding process up to competition, hoping to increase efficiency, accountability, and transparency. While the Biden administration has asked Congress to double the funding appropriated to HRSA for the transplant system, it has the authority to institute many of these changes without Congressional action. 

    The Gist: The US organ transplant system has long received criticism from patients and providers.With over 100K Americans currently on organ transplant waiting lists, and 6K dying annually while waiting (a group that is disproportionately Black and Latino), there’s vast room for improvement.

    The government’s efforts to increase competition to solve operational and distribution challenges is overdue, but other aspects of the transplant process, including performance evaluation, deserve reassessment as well. For example, providers are scored on the survival rates of patients who receive transplants, but not those who die on waiting lists. Thus, they are disincentivized to operate on higher-risk patients or utilize organs that are potentially transplantable but have imperfections.

    Hospitals and transplant specialists must take an active role in ensuring the overhauled process provides comprehensive reform, driven by the best interests of patients. 

    18M Are at Risk of Losing Medicaid Coverage at the End of Covid Emergency

    Of these 18 million people, 3.8 million people will become completely uninsured, according to the Urban Institute’s report. The estimate is higher than HHS’ August prediction of 15 million people losing coverage after the public health emergency.

    If the Covid-19 public health emergency expires in April, about 18 million people could lose Medicaid coverage, a new report concludes.

    The Urban Institute, which published the report, found that of these 18 million people, 3.8 million people will become completely uninsured. About 3.2 million children will likely move from Medicaid to separate Children’s Health Insurance Programs. Additionally, about 9.5 million people will receive employer-sponsored insurance. Lastly, more than 1 million people will enroll in a plan through the nongroup market.

    The Urban Institute’s estimates, published Monday, is higher than the U.S. Department of Health & Human Services’ (HHS) prediction of 15 million people losing coverage after the public health emergency ends. HHS’ report was published in August and stated that 17.4% of Medicaid and Children’s Health Insurance Program enrollees would leave the program. The Urban Institute’s report did not provide a percentage.

    To conduct the study, researchers from the Urban Institute relied on the most recent administrative data on Medicaid enrollment, as well as recent household survey data on health coverage. It used a simulation model to estimate how many Americans will lose Medicaid insurance.

    In 2020, Congress passed the Families First Coronavirus Response Act due to the Covid-19 pandemic. It barred states from disenrolling people during the public health emergency, and in return, states received a temporary increase in the federal Medicaid match rates. From February 2020 to June 2022, Medicaid enrollment increased by 18 million people, an unprecedented number, according to the Urban Institute.

    Currently, the public health emergency is set to end in January. But since the government has to provide a 60-day notice before the expiration —and did not do so in November — it is expected to be extended to April.

    Because many of the affected enrollees who will lose Medicaid coverage will be eligible for coverage through federal or state Marketplaces, the Urban Institute recommends coordination between the Marketplaces and state Medicaid agencies

    Researchers called on the government to take action so Americans are prepared for the end of the public health emergency.

    “State Medicaid officials and policymakers must continue to ensure that individuals currently enrolled in Medicaid are aware of the approaching end of the public health emergency, and that they have a plan to maintain or find new health coverage through their employer, the federal healthcare Marketplace, or Medicaid,” the Urban Institute said.