The Inflation Reduction Act (“IRA”) was signed into law by President Biden on August 16, 2022. The expansive legislation includes key health care provisions, including drug pricing reforms, inflationary rebates, Medicare Part D benefit redesign, as well as myriad other updates. Overall, the healthcare provisions of the IRA reflect the Administration’s goal of expanding the accessibility of healthcare to individuals by reducing costs to beneficiaries and capping charges by drug manufacturers. Nonetheless, additional clarification in the form of regulations is anticipated, as the text of the IRA defers multiple matters to the Department of Health and Human Services (“HHS”) for implementation.
On June 29, 2022, the Centers for Medicare and Medicaid Services (CMS) announced it issued significant changes to surveyor guidance for Long Term Care (LTC) facility health, quality and safety standards. …
On January 5, 2022, we discussed the Notice of Benefit and Payment Parameters for 2023 proposed rule released by the Centers for Medicare & Medicaid Services (CMS). On April 28, 2022, CMS issued the NBPP 2023 Final Rule. CMS published a Fact Sheet and other resources on April 28, 2022. The rule will take effect on January 1, 2023, but the optional early bird application deadline is May 18, 2022 and the final deadline for issuers to submit changes to their QHP Application is August 17, 2022.
Continue Reading 2023 Payment Rule’s Nondiscrimination Provisions and Anticipation of New Section 1557 Rules
On April 29, 2022, the Centers for Medicare and Medicaid Services (“CMS”), issued the final rule on Contract Year 2023 Policy and Technical Changes to the Medicare Advantage and Medicare Prescription Drug Benefit Programs (the “Final Rule”). CMS promotes the Final Rule as advancing “CMS’ strategic vision of expanding access to affordable health care and improving health equity in Medicare Advantage (MA) and Part D through lower out-of-pocket prescription drug costs and improved consumer protections.” With a few exceptions, the Final Rule is a wholesale codification of the proposed rule. Except as noted below, the requirements of the Final Rule are effective January 1, 2024.
Continue Reading CMS Issues Contract Year 2023 Final Rule for Medicare Advantage Organizations and Prescription Drug Sponsors
Last month, the U.S. Department of Health and Human Services Office of Inspector (“OIG”) released a report that studied prior authorization denials and payment denials by Medicare Advantage Organizations (“MAOs”) (the “Report”). While the Report found that the “vast majority” of prior authorizations and payment requests were approved, the Report focused on the finding that MAOs “sometimes” denied prior authorization and payment requests that met Medicare coverage rules claiming that the denials delayed or denied beneficiaries’ access to medically necessary services.
Continue Reading HHS OIG Report On Prior Authorizations Under Medicare Advantage
Physicians and other providers can take a deep breath as Congress has acted to prevent the trio of Medicare payment cuts that were set to take effect at the beginning of 2022—a 3.75% cut due to scheduled changes in the Medicare Physician Fee Schedule (“PFS”), a 2% cut for Medicare sequestration, and a 4% Statutory Pay-As-You-Go (“PAYGO”) Act cut would have slashed Medicare payments by nearly 10% during a tumultuous time for healthcare. The Protecting Medicare and American Farmers from Sequester Cuts Act (S. 610) was approved by the U.S. House of Representatives on December 7 and passed the U.S. Senate on December 9, 2021. The bill has been sent to President Biden’s desk for his signature.
Continue Reading News Flash: Last Minute Congressional Action Saves Physicians from a Nearly 10% Cut to Medicare Payments
On November 12, 2021, the Centers for Medicare and Medicaid Services (“CMS”) revised and finalized draft guidance first issued on May 3, 2019, for co-location of hospitals with other hospitals or healthcare providers (the “Finalized Guidance”). The Finalized Guidance is intended to guide CMS Surveyors in evaluation of such hospitals’ compliance with Medicare Conditions of Participation related to shared space, services, and staff.
Continue Reading CMS Loosens Restrictions on Co-Located Healthcare Providers; Enforcement Interpretation Still to Be Determined
As reintroduced in the U.S. House of Representatives by Rep. Frank Pallone, Jr. (D-NJ-6) on April 22, 2021 after originally being introduced on September 19, 2019, H.R. 3, also known as known as the Elijah E. Cummings Lower Drug Costs Now Act, proposes to grant the U.S. Department of Health and Human Services (“HHS”) the authority to negotiate directly with pharmaceutical companies in order to lower drug prices in Medicare Part B and Medicare Part D (the “Proposal”). The Proposal would require that 125 brand-name drugs that cost Medicare the most to be subject to negotiation by Medicare, with a cap on the price for each drug set at 120% of the average price paid in six other countries. The Proposal is part of a $3.5 trillion budget proposal that, as of this writing, faces an uncertain future in Congress. While not a novel idea, the Proposal is controversial and faces strong opposition from pharmaceutical companies in particular.
Continue Reading Elijah E. Cummings Lower Drug Costs Now Act: The Long and Winding Road to Drug Pricing Reform
On August 10, 2021, the Senate passed H.R. 3684, a roughly $1 trillion infrastructure bill (the “Infrastructure Bill”) that authorizes funds for federal-aid highways, transit, broadband access and other infrastructure purposes. Notably, the Infrastructure Bill is paid for in part through changes to several healthcare policies, including delaying a Medicare Part D rebate rule for an additional three years and reducing Medicare payment amounts to providers. The Infrastructure Bill’s changes to healthcare policies provide a mixed impact to health care industry stakeholders, with both expected benefits and burdens to providers, payers, and drug manufacturers.
Continue Reading The Infrastructure Investment and Jobs Act: Potential Impact on Healthcare Policy and Spending
On August 10, 2021, the Centers for Medicare and Medicaid (“CMS”) published a proposed rule (“Proposed Rule”) to rescind the Most Favored Nation Model (“MFN Model”) interim final rule that was published on November 26, 2020 (“Interim Final Rule”). As described in our December 2020 blog post, the Interim Final Rule established a seven-year nationwide, mandatory MFN Model that would test an alternative way for Medicare to pay for certain Medicare Part B single source drugs and biologicals. The MFN Model, originally set to begin January 1, 2021, would have tied the prices for certain Part B single-source drugs and biologics to the average price paid by several overseas countries and remove incentives to use higher cost drugs, in order to determine whether this could “control unsustainable growth in Medicare Part B spending without adversely affecting quality of care for beneficiaries.” Had the Interim Final Rule been implemented, Medicare Part B reimbursement would have been significantly reduced starting January 1, 2021.
Continue Reading Executive Order on Promoting Competition in the American Economy: The Biden Administration Considers Drug Pricing Strategies While Keeping the “Most Favored Nations” Drug Reimbursement Program on the Sidelines
On August 13, 2021, the D.C. Circuit Court of Appeals reversed a district court opinion vacating CMS’ Overpayment Rule, 42 C.F.R. 422.326, for Medicare Advantage organizations (“MAOs”). UnitedHealthcare Insurance Co. et al. v. Becerra et al., case number 18-5326. As a result of this decision, CMS can once again rely on the Overpayment Rule to impose voluntary refund obligations for MAOs. MAOs – already subject to significant government enforcement related to their risk adjustment coding practices – should carefully consider the implications of this decision for their coding and auditing practices.
Continue Reading D.C. Circuit Gives New Life to CMS Overpayment Rule