On December 31, 2008, CMS published a notice correcting a number of technical and typographical errors in the November 19, 2008 final Medicare physician fee schedule rule for calendar year 2009. In addition, on December 30, 2008, CMS published a notice correcting certain wage data included in the October 3, 2008 final FY 2009 Medicare hospital inpatient prospective payment system rule.
On December 19, 2008, the Centers for Medicare & Medicaid Services (CMS) published a final rule implementing provisions of the Medicare Modernization Act of 2003 related to state auditing and reporting of Medicaid disproportionate share hospital (DSH) payments, effective January 19, 2009. CMS also published a separate notice announcing the final federal share DSH allotments for federal fiscal year (FY) 2007 and the preliminary federal share DSH allotments for FY 2009. The notice also announces the final FY 2007 and the preliminary FY 2009 limitations on aggregate DSH payments that states may make to institutions for mental disease and other mental health facilities.
CMS published a final rule on December 19, 2008 that implements a provision of the Deficit Reduction Act of 2005 that provides states with additional flexibility to establish a non-emergency medical transportation brokerage program, and to receive the federal medical assistance percentage matching rate. The rule is effective January 20, 2009.
CMS published a document on December 22, 2008 correcting technical errors that appeared in the November 3, 2008 notice updating Medicare home health agency (HHA) prospective payment system (PPS) rates for 2009.
On December 19, 2008, the Department of Health and Human Services (HHS) published a controversial final rule to implement and enforce certain federal nondiscrimination statutes protecting the conscience rights of health care providers and other entities. Among other things, the rule clarifies that non-discrimination protections allowing a provider to refuse to perform health care services to which they may object for religious, moral, ethical, or other reasons apply to institutional health care providers as well as to individual employees working for recipients of certain HHS funds; requires recipients of certain HHS funds to certify their compliance with laws protecting provider conscience rights; designates the HHS Office for Civil Rights as the entity to receive related discrimination complaints; and establishes compliance provisions, including termination and recoupment of funding paid in violation of the nondiscrimination provisions if voluntary compliance is not achieved. The rule is effective January 20, 2009, although HHS components have been given discretion to phase in the written certification requirement by October 1, 2009 (the beginning of FY 2010).
The Food and Drug Administration (FDA) is seeking comments on a planned "Experimental Study of the Impact of Coupons Embedded in Direct-to-Consumer Prescription Drug Print Advertisements." According to the FDA notice, the study will examine the impact of the presence of coupons offering price incentives or rebates on consumers' perceptions of product risks and benefits in direct-to-consumer (DTC) print ads. The FDA acknowledges, however, that "it does not actually regulate the dollar or other incentive amount of coupons, price incentives, or rebate offers with respect to how they affect the price of prescription drugs or biological products." Comments will be accepted until February 13, 2009.
The FDA Office of Orphan Product Development has announced grants to support the clinical development of products for use in rare diseases or conditions where no current therapy exists or where the proposed product will be superior to the existing therapy. Grants are available for clinical studies on safety and/or effectiveness that will either result in, or substantially contribute to, market approval of these products. Of the estimated FY 2010 funding ($14.1 million) for this program, approximately $10 million will fund noncompeting continuation awards, and approximately $4.1 million will fund 10 to 12 new awards, subject to availability of funds.
On December 17, 2008, the HHS Office of Inspector General (OIG) published its annual solicitation of proposals and recommendations for new or revised safe harbor provisions under the federal anti-kickback statute, and new OIG special fraud alerts. The comment deadline is February 17, 2009. A status report on the comments the OIG received in response to last year's solicitation is set forth in Appendix D to the OIG’s Semiannual Report for the period of April 1, 2008 through September 30, 2008.
HHS has published the federal medical assistance percentages and enhanced federal medical assistance percentages for fiscal year (FY) 2010. The percentages in this notice apply to state expenditures for most medical services and medical insurance services, and assistance payments for certain social services.
On December 3, 2008, the Centers for Medicare & Medicaid Services (CMS) published a final rule to provide states with increased flexibility under an approved state plan to define the scope of covered Medicaid benefits, as authorized by the Deficit Reduction Act of 2005 (DRA). Under the rule, states may offer coverage of the following benchmark or benchmark-equivalent benefit packages to certain Medicaid recipients: the standard Blue Cross/Blue Shield preferred provider option service benefit plan under the Federal Employees Health Benefit Plan; state employee coverage; coverage offered by the state’s largest commercial health maintenance organization; or coverage approved by the Secretary of the Department of Health and Human Services (HHS). The rule is effective February 2, 2009. Note that CMS characterizes the rule as a codification of guidance CMS issued on March 31, 2006 to state Medicaid directors, and the agency points out that states have already begun implementing this provision in advance of this final rule.
The Food and Drug Administration (FDA) is announcing an opportunity for public comment on a planned FDA study examining consumer comprehension of inclusion of a toll-free number to report side effects in direct-to-consumer (DTC) prescription drug television advertisements. Comments will be accepted until January 26, 2009.
On December 3, 2008, CMS issued FY 2009 hospital wage index changes to implement Section 124 of the Medicare Improvement for Patients and Providers Act of 2008 (MIPPA). The notice contains revised final wage indices and hospital reclassifications for 27 hospitals and are applicable for discharges beginning October 1, 2008.
On November 21, 2008, the Department of Health and Human Services (HHS) published a final rule to implement certain aspects of the Patient Safety and Quality Improvement Act of 2005 (Patient Safety Act). By way of background, the Patient Safety Act is designed to encourage health care providers to voluntarily report patient safety information, medical errors, and “near misses” to Patient Safety Organizations (PSOs). In order to facilitate such disclosure, the law creates certain legal privilege and confidentiality protections for any patient safety work product (PSWP) either developed by a PSO or prepared by a health care provider and delivered to a PSO. The final rule establishes a framework by which hospitals, doctors, and other health care providers may voluntarily report information to PSOs, on a privileged and confidential basis, for the aggregation and analysis of patient safety events. The regulation outlines the requirements that entities must meet to become PSOs and the processes by which the Secretary will review and accept certifications and list PSOs. It also describes the privilege and confidentiality protections for the information that is assembled and developed by providers and PSOs, the exceptions to these privilege and confidentiality protections, and the procedures for the imposition of civil money penalties for the knowing or reckless impermissible disclosure of patient safety work product. The final rule is effective January 19, 2009. When the final rule goes into effect, it will supersede interim guidance released October 14, 2008, although any information that became PSWP under the interim guidance criteria will remain PSWP, and thus privileged and confidential, after the interim period.
On November 24, 2008, the Centers for Medicare & Medicaid Services (CMS) published an interim final rule with comment period making technical changes to the methodology used to compute each state's preliminary and final allotments available to pay the Medicare Part B premiums for qualifying individuals (QIs). The rule also contains charts providing the states' final QI allotments for the federal fiscal year (FY) 2008 and preliminary QI allotments for FY 2009. While the rule is effective November 24, 2008, the final allotments for FY 2008 are effective October 1, 2007 and the preliminary allotments for FY 2009 are effective October 1, 2008. CMS will accept comments on the rule until January 23, 2009.
On November 25, 2008, CMS published a final rule on Medicaid premiums and cost sharing to implement requirements of the Deficit Reduction Act of 2005 and the Tax Relief and Health Care Act of 2006. Among other things, the legislation provided state Medicaid agencies with increased flexibility to impose premium and cost sharing requirements on certain Medicaid recipients, including drug cost sharing requirements designed to encourage the use of preferred drugs and to allow higher cost-sharing for non-emergency care furnished in a hospital emergency department. The rule is effective 60 days after publication.
On November 21, 2008, CMS published a notice correcting technical and typographical errors identified in the September 18, 2008 interim final rule with comment period that revises the regulations governing the Medicare Advantage program, the Part D prescription drug benefit program, and section 1876 cost plans to conform with provisions of the Medicare Improvements for Patients and Providers Act (MIPPA). The correcting amendment is effective November 21, 2008, and is applicable on September 18, 2008.
On November 24, 2008, the Food and Drug Administration (FDA) announced the availability of a draft guidance document entitled “Contents of a Complete Submission for the Evaluation of Proprietary Names.” The document is intended to help prevent medication errors by assisting industry in the submission of complete product information that will enable FDA to evaluate the safety of proposed proprietary drug and biological product names. In addition, FDA intends to use this information in the assessment of promotional aspects of proposed proprietary names. The FDA will accept comments on the draft until January 23, 2009.
Separately, on November 18, 2008, the FDA announced the availability of draft guidance entitled “Process Validation: General Principles and Practices.” The FDA is revising related May 1987 guidance to promote a “lifecycle approach” to process validation for the manufacture of human and animal drug and biological products, including active pharmaceutical ingredients. Comments will be accepted until January 20, 2009.
On November 24, 2008, the Department of Health and Human Services (HHS) published its semiannual regulatory agenda, outlining planned regulatory initiatives in a number of health policy areas. A separate document listing major Administration regulatory initiatives and priorities, including health policy priorities, also is available.
On November 14, 2008, the Centers for Medicare & Medicaid Services (CMS) published an interim final rule with comment period revising marketing requirements for Medicare Advantage (MA) plans and Medicare Part D prescription drug plans (PDPs). Specifically, the rule amends requirements just issued on September 18, 2008 to further limit the compensation that can be paid to agents or brokers with respect to MA and Part D plans in order to limit incentives to switch beneficiaries between plans to generate commissions, as authorized by the Medicare Improvements for Patients and Providers Act (MIPPA). Under the September 18 rule, plans were required to pay compensation on a six-year cycle, comprised of an initial enrollment year and five renewal years, with compensation in the initial year capped at 200% of the amount paid for renewal years. CMS received complaints, however, that plans were misinterpreting the rule’s intent by proposing structures under which compensation in the initial year in the cycle was less than the renewal years and renewal compensation varied from year to year. Among other things, the November 14 rule modifies the marketing requirements by:
The rule is effective November 10, 2008; CMS is accepting comments on the rule until December 15, 2008.
On November 7, 2008, CMS published a final rule clarifying the definition of outpatient hospital services under Medicaid to align it more closely with the Medicare definition of such services. CMS stresses that the regulation does not eliminate any Medicaid benefit category, place reimbursement restrictions on those categories, or alter the qualifications that must be met to provide a Medicaid covered service. Note that while the proposed version of the rule, published September 28, 2007, included provisions regarding methods for demonstrating compliance with the upper payment limit (UPL), in consideration of the Congressional moratorium on a separate proposed rule on UPLs published January 18, 2007, CMS is reserving action on the proposed provisions related to outpatient hospital UPLs. CMS may consider publication of the UPL guidance at a future date. The rule is is effective December 8, 2008.
On November 12, 2008, the Food and Drug Administration (FDA) issued a direct final rule to adjust for inflation the maximum civil money penalty (CMP) amounts for the various CMP authorities under FDA jurisdiction, as required by the Federal Civil Penalties Inflation Adjustment Act. The rule does not adjust new CMPs enacted by the Food and Drug Administration Amendments Act of 2007. The FDA is using direct final rulemaking for this action because the agency expects no significant adverse comment on the rule. However, the agency also is concurrently issuing the rule in proposed form and soliciting comments on the direct rule. If significant adverse comments are received, the FDA will withdraw the final rule and address the comments in a subsequent rulemaking. The rule is effective March 27, 2009, unless the FDA receives significant adverse comment by January 26, 2009. Comments will be accepted on the proposed rule until December 26, 2008.
The FDA published a notice November 13, 2008 requesting written notification of any industry organizations interested in participating in the selection of nonvoting industry representatives to serve on Center for Biologics Evaluation and Research (CBER) public advisory committees. The FDA also is soliciting nominations for nonvoting industry representatives to serve on the following CBER public advisory committees: the Cellular, Tissue and Gene Therapies Advisory Committee; the Vaccines and Related Biological Products Advisory Committee; and the Transmissible Spongiform Encephalopathies Advisory Committee. Notifications of interest and nominations are due December 15, 2008.
On October 30, 2008, the Centers for Medicare & Medicaid Services (CMS) released the text of its final rule updating the Medicare physician fee schedule (MPFS) for calendar year (CY) 2009. As required under the “Medicare Improvements for Patients and Providers Act of 2008” (MIPPA), the rule increases physician payments by 1.1% in 2009, rather than the 5.4% cut CMS anticipated would result from the Sustainable Growth Rate (SGR) formula when it issued the July 7, 2008 proposed rule. Note that MIPPA did not amend the underlying SGR formula or modify payments for years after 2009; the Congressional Budget Office estimates that physician payment rates will be cut by 21% in 2010 unless Congress takes further action. In addition to making changes to physician payment rates, the sweeping rule includes many other policy changes, include the following.
Continue Reading...On October 30, 2008, CMS released its final rule with comment period updating Medicare hospital outpatient prospective payment system (HOPPS) and ambulatory surgical center (ASC) reimbursement and related policies for CY 2009. CMS expects that the final rule will increase HOPPS spending by 3.9 percent overall as a result of the inflation update and other policy changes. With respect to HOPPS policy, the final rule, among many other things:
CMS has adopted more limited changes for ambulatory surgical centers for 2009. The ASC prospective payment system (ASC PPS) is in the second year of a four-year transition that aligns ASC rates with HOPPS rates. For CY 2009, rates are be based on a blend of 50% of the CY 2007 ASC payment weight for the procedure and 50% of the CY 2009 fully implemented ASC weight (generally 65% of the corresponding HOPPS rate). CMS notes that the statute does not allow an inflation update to the ASC PPS for CY 2009. The rule also, among other things, refines the lists of covered ASC services, office-based procedures that are subject to special payment policies, and device-intensive procedures. The rule also finalizes updates to the ASC conditions for coverage (proposed August 31, 2007) to reflect current ASC practices and to establish new requirements to promote patient health and safety.
While CMS has released the advance text of the rule, and the official version is scheduled to be published in the Federal Register on November 18, 2008. CMS will accept comments until December 29, 2008 on HOPPS payment classification for certain HCPCS codes and number of policy issues outlined in the rule.
On November 3, 2008, CMS published a notice updating the 60-day national episode rates and the national per-visit amounts under the Medicare home health prospective payment system (HH PPS), effective January 1, 2009. The notice includes a 2.9 percent home health market basket increase, but this increase is largely offset by a 2.75 percent reduction to the HH PPS rates to account for the changes in case-mix that are unrelated to patient’s health status (the second year of a four-year phase-in) and an adjustment to the wage index for 2009. CMS estimates that overall Medicare home health payments will increase by a total of $30 million in CY 2009. As mandated by the Deficit Reduction Act of 2005, if a home health agency does not submit quality data, the home health market basket percentage increase will be reduced 2 percentage points. The required quality measures for meeting the submission requirements for CY 2009 are the same as those used for CY 2008.
On October 28, 2008, the Food and Drug Administration (FDA) published a final rule requiring a statement to be included on certain human drug product labeling that provides a toll-free number for reporting side effects and specifies that the number is not intended to be used for medical advice. The rule, which confirms a January 3, 2008 interim final rule on this issue, implements provisions of the Best Pharmaceuticals for Children Act and the Food and Drug Administration Amendments Act of 2007. The compliance date for the final rule is July 1, 2009 (rather than the January 1, 2009 compliance date anticipated under the interim final rule).
On October 20, 2008, the Department of Health and Human Services (HHS), together with the Treasury and Labor Departments, published a final rule imposing requirements on group health plans and health insurance issuers concerning hospital lengths of stay for mothers and newborns following childbirth. The rule, which finalizes interim final rules published October 27, 1998 under the Newborns’ and Mothers’ Health Protection Act of 1996 and the Taxpayer Relief Act of 1997, generally prohibits group health plans and group health insurance issuers from limiting hospital lengths of stay in connection with childbirth to less than 48 hours for vaginal deliveries and 96 hours for cesarean sections, and provides other related protections. The rule is effective December 19, 2008, and applies to individual and group health plans and group health insurance issuers for plan years beginning on or after January 1, 2009.
The HHS Office of Inspector General (OIG) has issued a report entitled “Medicaid-Funded Personal Care Services in Excess of 24 Hours per Day.” Based on a sampling of cases in five states, the OIG found 871 instances in which states paid claims for Medicaid reimbursement for personal care services (such as assistance with activities of daily living) in excess of 24 hours per day, and many other cases in which services totaled close to 24 hours a day. The OIG suggested that CMS inform states regarding vulnerabilities in this area, including problems associated with allowing providers to submit such claims in date ranges that include days on which no services were provided.
On October 14, 2008, the Agency for Healthcare Research and Quality (AHRQ) and the Office for Civil Rights (OCR) of the Department of Health and Human Services (HHS) published a notice announcing the availability of an interim guidance document entitled “Implementing the Patient Safety and Quality Improvement Act of 2005, Including How to Become a Patient Safety Organization.'' The guidance document explains how HHS will begin implementing the Patient Safety and Quality Improvement Act of 2005 (Patient Safety Act), which is designed to encourage health care providers to voluntarily report patient safety information, medical errors, and “near misses” to Patient Safety Organizations (PSOs). In order to facilitate such disclosure, the law creates certain legal privilege and confidentiality protections for any patient safety work product (PSWP) either developed by a PSO or prepared by a health care provider and delivered to a PSO. The new guidance explains how an entity can become a PSO, and how information may be protected as PSWP in the period prior to the promulgation of a final regulation that the agencies indicate will be issued before the end of 2008 (but that schedule is subject to change). The interim guidance is effective October 14, 2008 until the effective date of a final rule. While the final regulation will supersede this interim guidance, any information that became PSWP during this interim period based upon the Patient Safety Act criteria will remain PSWP, and thus privileged and confidential, after the interim period.
On October 10, 2008, the Centers for Medicare & Medicaid Services (CMS) published a notice soliciting comments on the Medicare Part D/Medicare Advantage Calendar Year (CY) 2010 Bid Pricing Tool and the CY 2010 Plan Benefit Package software and formulary submission. CMS also has posted the forms and related documents regarding the information collections. CMS will accept comments on the forms through December 9, 2008.
On October 3, 2008, CMS published a notice updating the final Medicare hospital inpatient prospective payment system (IPPS) wage indices, hospital reclassifications, payment rates, and other tables for fiscal year (FY) 2009, which began October 1, 2008. The data reflects the extension of the expiration date for certain geographic reclassifications and special exception wage indices as required by the Medicare Improvement for Patients and Providers Act of 2008 (MIPPA). In a related development, CMS published a separate notice correcting a series of technical and typographical errors that appeared in August 19, 2008 IPPS final rule, including corrections of regulatory language related to physician self-referral provisions.
On October 1, 2008, CMS published a document correcting technical errors that appeared in the August 8, 2008 Medicare skilled nursing facility (SNF) prospective payment system final rule for FY 2009.
On October 2, 2008, CMS published a notice soliciting nominations for individuals to serve on the Program Advisory and Oversight Committee (PAOC), which advises the Secretary of Health and Human Services on Medicare competitive bidding program for durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS). CMS has a particular interest in individuals with expertise in DMEPOS and competitive bidding, as well as experience in furnishing services and items in the rural and the urban marketplace. CMS will select 10-12 PAOC members representing beneficiaries, physicians, suppliers, professional standards organizations, financial standards specialists, and association representatives, among others. These individuals will replace the previous members of the PAOC (although CMS could reappoint previous members). Nominations are due November 3, 2008.
On October 3, 2008, CMS published a final rule to provides guidance to states that seek to administer self-directed personal assistance services through their state plans, as authorized by the Deficit Reduction Act of 2005. The state plan option allows beneficiaries, through an approved self-directed services plan and budget, to purchase personal assistance services, rather than have those services directed by an agency. Beneficiaries could hire qualified family members to perform certain personal assistance (but not medical) services. Allotments also could be used to purchase items that promote independence, such as a wheelchair ramp. The rule provides guidance to ensure beneficiary health and welfare and financial accountability of the state plan option. To request state plan change, the state must have an existing personal care services benefit or be operating a home or community-based services waiver program. Beneficiary enrollment would be voluntary, and the state also must provide traditional agency-delivered services if the beneficiary wishes to discontinue self-directed care. The rule is effective November 3, 2008.
On October 7, 2008, CMS pubished a final rule revising the definition of "multiple source drug" under the Medicaid program. The rule also responds to public comments received on the March 14, 2008 interim final rule with comment period. The final rule adopts the March 2008 interim final rule with the following change: in §447.205, paragraph (3)(i) of the definition of multiple source drug, the term "covered outpatient drug" is revised to read "drug product" and "listed product" respectively to reflect the statutory language. As noted in the interim final rule with comment period, to the extent that this rule may affect Medicaid reimbursement rates for retail pharmacies, it is subject to the injunction issued by the United States District Court for the District of Columbia in National Association of Chain Drug Stores et al. v. Health and Human Services. The rule is effective is effective November 6, 2008.
On September 29, 2008, the Food and Drug Administration (FDA) published a direct final rule requiring holders of a new drug application (NDA) to submit certain information regarding authorized generic drugs in an annual report . The rulemaking is part of the agency’s implementation of the Food and Drug Administration Amendments Act of 2007 (FDAAA), which requires that FDA publish a list of all authorized generic drugs included in an annual report since 1999, and that the agency update the list quarterly. The agency is publishing the requirement as a direct final rulemaking because it does not expect significant adverse comment on the rule. As part of the administrative requirements for a direct final rule, the agency is concurrently issuing a proposed rule and soliciting comments and, if any significant adverse comment is received, the FDA will withdraw the direct final rule and address the comments in a subsequent rulemaking. If there is no significant adverse comment, the direct final rule will automatically become effective February 11, 2009. Comments will be accepted until December 15, 2008, although comments on related information collection provisions are due October 29, 2008.
On October 6, 2008, CMS announced expanded efforts to combat Medicare DMEPOS and home health fraud and abuse, including targeted reviews of home health agencies (HHAs) in Florida and greater scrutiny of DMEPOS suppliers in Florida, California, Texas, Illinois, Michigan, North Carolina, and New York. In particular, CMS will be reviewing DMEPOS items with high expenditures and high growth rates, such as oxygen supplies and equipment, power mobility devices/power wheelchairs, and diabetic test strips. Targeted steps will include:
In addition, CMS has announced that it has awarded contracts to four permanent Recovery Audit Contractors (RACs) to review all Medicare Part A and B paid claims to identify Medicare overpayments and underpayments. The RACs will be paid on a contingency fee basis on both the overpayments and underpayments they find. The nationwide RAC program follows a three-year demonstration program in six states that collected over $900 million in overpayments and returned nearly $38 million in underpayments. Finally, CMS is consolidating the Medicare’s program safeguard contractors (PSCs) and the Medicare Drug Integrity Contractors (MEDICs) with new Zone Program Integrity Contractors (ZPICs), which eventually will be responsible for ensuring the integrity of all Medicare-related claims.