Reed Smith Analysis: Trump Administration’s Drug Pricing Blueprint

As previously reported, the Trump Administration has released its “Blueprint to Lower Drug Prices and Reduce Out-of-Pocket Costs.”  Many of the recommendations in the Blueprint were previously made in President Trump’s fiscal year 2019 budget proposal, while numerous others are framed as open-ended questions rather than policies.  While the near-term impacts on drug pricing based upon the contemplated policy changes are questionable, the wide-ranging reforms under consideration — if enacted — could significantly impact virtually every segment of the health care industry involved in the drug distribution system.  The public has an opportunity to comment formally on the Blueprint through July 16, 2018.

Reed Smith has prepared a Client Alert that provides a summary and analysis of the Blueprint.  Please click here to read more.

IRF PPS Payments Set to Increase by $75 Million in FY 2019 under Proposed CMS Rule

The Centers for Medicare & Medicaid Services (CMS) has published a proposed rule to update Medicare rates for inpatient rehabilitation facility (IRF) services for fiscal year (FY) 2019. CMS estimates that IRF prospective payment system (PPS) payments would increase by a total of $75 million under the proposed rule compared to FY 2018 levels. Specifically, CMS proposes to update IRF PPS payment rates by 1.35%, which reflects an IRF market basket update of 2.9%, which is reduced by a 0.8 percentage point multifactor productivity adjustment and a statutory 0.75 percentage point reduction. The proposed FY 2019 standard payment conversion factor is $16,020, compared to $15,838 in FY 2018. An IRF that does not submit required quality data to CMS is subject to a 2.0 percentage point decrease in its annual update. The proposed outlier threshold amount would be increased from $8,679 for FY 2018 to $10,509 for FY 2019, which would decrease aggregate payments by approximately 0.4%. CMS also proposes updates to the IRF wage index and case-mix group relative weights in a budget-neutral manner.

In addition, CMS proposes to reduce the regulatory burden for IRFs by: removing the Functional Independence Measure instrument and associated Function Modifiers from the IRF-Patient Assessment Instrument; allowing the post-admission physician evaluation to count as one of the required face-to-face physician visits; allowing the rehabilitation physician to lead the interdisciplinary meeting remotely without any additional documentation requirements; and removing the admission order documentation requirement. Furthermore, CMS requests comments regarding removing the face-to-face requirement for rehabilitation physician visits and expanding the use of nonphysician practitioners in meeting the IRF coverage requirements. CMS also proposes to update the requirements for the IRF Quality Reporting Program, including adding a new quality measure removal factor and removing two measures from the measure set.

Consistent with other proposed FY 2019 payment rules, CMS includes a Request for Information (RFI) seeking input on ways to promote interoperability and electronic healthcare information exchange, including through possible new or revised conditions of participation. CMS will accept comments on the proposed rule and RFI through June 26, 2018.

CMS Announces First Rural Health Strategy

 CMS has released an-agency-wide Rural Health Strategy that seeks to “better serve individuals in rural areas and avoid unintended consequences of policy and program implementation.” The Strategy has five objectives:

  1. Apply a rural lens to CMS programs and policies (e.g., apply a new checklist to relevant policies, procedures, and initiatives that impact rural communities)
  2. Improve access to care through provider engagement and support (e.g., maximize scope of practice)
  3. Advance telehealth and telemedicine (e.g., address reimbursement, cross-state licensure issues, and administrative/financial burdens)
  4. Empower patients in rural communities to make decisions about their healthcare (e.g., support adoption of health information technology)
  5. Leverage partnerships to achieve the goals of the CMS Rural Health Strategy (e.g., work with state partners, federal agencies, and health plan representatives).

Congressional Hearings Focus on 340B Program, Health Workforce, Other Health Policy Issues

In addition to the numerous hearings and markups on the opioid crisis discussed in a separate post, Congressional committees are examining the following health policy topics:

In addition, the Senate HELP committee is holding a May 22, 2018 hearing on the health care workforce.

Congressional Committees Approve Legislation to Address Opioid Crisis

Congress is considering a wide range of legislative proposals that seek to address the continuing opioid crisis. The following committees have tackled this topic recently:

  • Senate Committee on Health, Education, Labor and Pensions (HELP) approved S. 2680, the Opioid Crisis Response Act of 2018, comprised of 40 proposals to address the opioid crisis through such mechanisms as grants to states for prevention, response and treatment of the opioid crisis; accelerating research on non-addictive pain medication; and revisions to FDA authorities.
  •  On May 9, 2018, the House Energy and Commerce Committee approved 25 bills to address the opioid crisis. Specific areas addressed by the legislation include funding for National Institutes of Health research on new non-addictive pain medications, establishment of Comprehensive Opioid Recovery Centers, the use of electronic health records by behavioral health providers, an evaluation of the use of abuse-deterrent opioids in Medicare plans, and Medicare drug plan drug management programs for at-risk beneficiaries, among many others. A second full Committee markup is scheduled on May 17, 2018 to consider another 34 opioid-related bills. Earlier, the Energy and Commerce Health Subcommittee approved 56 bills focused on addressing the opioid crisis and held hearings on the privacy of substance use disorder treatment records and opioid distribution practices.

On May 16, the Ways and Means Committee is marking up an additional package of bills to address the opioid crisis (HR 5774, Combatting Opioid Abuse for Care in Hospitals (COACH) Act; HR 5775, Providing Reliable Options for Patients and Educational Resources (PROPER) Act; HR 5776, Medicare and Opioid Safe Treatment (MOST) Act; HR 5773,“Preventing Addiction for Susceptible Seniors (PASS) Act; HR 5676, Stop Excessive Narcotics in our Retirement (SENIOR) Communities Protection Act; HR 5723, Expanding Oversight of Opioid Prescribing and Payment Act; and HR __, Synthetics Trafficking and Overdose Prevention (STOP) Act of 2017). In addition, on May 17, the Senate Judiciary Committee will consider the following bills: S 2645, Access to Increased Drug Disposal Act of 2018; S 2535 Opioid Quota Reform Act; S 2789 Substance Abuse Prevention Act; S 207, Synthetic Abuse and Labeling of Toxic Substances Act of 2017; S.__, Using Data to Prevent Opioid Diversion Act of 2018; and S_ Preventing Drug Diversion Act of 2018.

Trump Administration Releases Drug Pricing “Blueprint” and Request for Comments on Reducing Drug Costs

The Trump Administration has launched a high-profile initiative aimed at reducing prescription drug prices, including release of a blueprint containing a series of short- and long-term policy proposals and a request for public comments on additional reforms.

First, on May 11, 2018 the Department of Health and Human Services released its “Blueprint to Lower Drug Prices and Reduce Out-of-Pocket Costs,” which sets forth proposals in four broad areas: improved competition; lowering out-of-pocket costs; enhanced negotiation; and incentives for lower list prices. A number of the proposals were previously included in the President’s FY 2019 budget proposal, such as changes to the 340B discount drug program and inflation limits for Medicare Part B drugs. The Administration potentially could implement some of the new proposals under its current policymaking authority (e.g., reviving the Part B Competitive Acquisition Program; updating CMS’s drug-pricing dashboard to make price increases and generic competition more transparent; developing demonstration projects to test innovative ways to encourage value-based care and lower drug prices; and prohibiting Part D contracts from preventing pharmacists from telling patients when they could pay less out-of-pocket by not using insurance). Many of the most significant proposals would require Congressional action, however, such as reforms to the 340B program and Medicaid drug rebate program; moving certain classes of drugs from Part B to Part D to realize savings; and giving Medicare Part D plan sponsors significantly more power when negotiating with manufacturers. It is still unclear the extent to which the Blueprint will be translated into specific legislative proposals, or the schedule for Congress considering any such legislation.

Note that many of the Blueprint proposals are framed as questions for consideration rather than actual proposals at this point, such as:

  • Do pharmacy benefit managers’ rebates and fees based on the percentage of the list price create an incentive to favor higher list prices (and the potential for higher rebates) rather than lower prices?
  • Should manufacturers of drugs who have increased their prices over a particular lookback period or have not provided a discount be allowed to be included in the Part D protected classes?
  • How could indication-based pricing support value-based purchasing?
  • What policies should CMS consider to ensure inpatient and outpatient providers are neither underpaid nor overpaid for a drug, regardless of where it was administered?
  • What can be done to reduce the pricing disparity and spread the burden for incentivizing new drug development more equally between the U.S. and other developed countries?

On May 14, 2018, HHS released a request for information (RFI) seeking public input on the Blueprint. The RFI restates the questions in the Blueprint, covering such topics as: underpricing/cost shifting; biosimilar development; “fixing global freeloading”; site neutrality; fiduciary duty for pharmacy benefit managers; reducing the impact of rebates; incentives to lower or not increase list prices; inflationary rebate limits; exclusion of certain payments, rebates, or discounts from the determination of average manufacturer price and best price; and copay discount cards. HHS will accept comments until July 16, 2018. Reed Smith is preparing a more comprehensive analysis of the Administration’s drug pricing blueprint.

CMS Proposes Payment and Policy Changes Impacting SNFs for FY 2019 – Plus a New “Patient-Driven Payment Model” Case Mix System for FY 2020

The Centers for Medicare & Medicaid Services (CMS) has issued its annual proposed update to Medicare skilled nursing facility (SNF) PPS rates and policies for fiscal year (FY) 2019. In addition to providing a $850 million boost to Medicare payments for FY 2019, CMS proposes a new case mix classification system to replace the existing Resource Utilization Groups, Version IV (RUG–IV) model beginning in FY 2020. CMS will accept comments on the proposed rule until June 26, 2018.

With regard to the annual payment update, CMS proposes to increase rates by 2.4%, as mandated by the Bipartisan Budget Act of 2018; CMS estimates that in the absence of legislation, the update would have been 1.9%. The annual update is reduced by 2 percentage points for SNFs that fail to submit required quality data to CMS under the SNF Quality Reporting Program (QRP).  CMS does not propose adding any new SNF QRP measures at this time; instead, CMS proposes to establish as a factor for removing measures that the costs of a measure outweighs its benefit.  CMS also proposes various updates to the SNF Value-Based Purchasing Program (VBP), which adjusts a SNF’s payments up or down based on its performance on a 30-day hospital readmissions measure.

The proposed new Patient-Driven Payment Model (PDPM) case mix classification system builds on the proposed Resident Classification System, Version I (RCS-I), that CMS set forth in a May 2017 Advanced Notice of Proposed Rulemaking. Like the RCS-I, the PDPM seeks to base Medicare payment on resident needs rather than the amount of therapy a resident receives, but CMS believes the PDPM better accounts for verifiable resident characteristics while reducing systemic and administrative complexity.  In short, the proposed PDPM would identify and adjust the following five case-mix components to characterize a resident’s care:  Physical Therapy (PT), Occupational Therapy (OT), Speech-Language Pathology, Non-Therapy Ancillary (NTA), and Nursing.  Within these components, the patient is assigned to one of 10 clinical categories based on their primary diagnosis (determined by ICD-10 codes recorded in MDS item I8000).  CMS would apply variable per diem payment adjustments to account for changes in resource use over the course of a stay for the PT, OT, and NTA components.  The sum of each of five components would be combined with the non-case-mix component to determine the full SNF PPS per diem rate for that resident.  CMS proposes implementing the PDPM effective October 1, 2019.

CMS expresses concerns that its proposed change in how therapy services would be used to classify residents under the PDPM could incentivize the use of group and concurrent therapy rather than individual therapy. CMS therefore proposes to establish a combined 25% limit on concurrent therapy and group therapy for each discipline of therapy provided.  CMS also proposes to implement an interrupted stay policy beginning FY 2020, in conjunction with implementation of the PDPM.  Under this policy, if a resident is discharged from a SNF and returns to the same SNF by 12:00 a.m. at the end of the third day of the “interruption window,” the treating the resident’s stay as a continuation of the previous stay for purposes of both resident classification and the variable per diem adjustment schedule.  If the resident’s absence from the SNF exceeds this 3-day interruption window, or if the resident is readmitted to a different SNF, CMS proposes treating the readmission as a new stay.  Also effective October 1, 2019, CMS proposes to revise the current SNF PPS assessment schedule to require only two scheduled assessments (instead of the current five) for each SNF stay:  a 5-day scheduled PPS assessment and a discharge assessment.  A separate “Interim Payment Assessment” would be used to capture changes in the resident’s condition in certain situations.  CMS seeks comments on these proposed policies.

CMS Announces Temporary Fee Schedule Increase for Certain Medical Equipment Furnished in Rural Areas

Today the Centers for Medicare & Medicaid Services (CMS) published an interim final rule with comment period that will provide a temporary Medicare rate hike for certain durable medical equipment (DME) and enteral nutrition furnished in rural and non-contiguous areas of the country (Alaska, Hawaii, and U.S. territories) that are not included in competitive bidding.

By way of background, the Affordable Care Act mandated that CMS use pricing information from the DME, prosthetics, orthotics, and supplies (DMEPOS) competitive bidding program (CBP) to adjust fee schedule amounts for items furnished in areas where the CBP is not implemented. A highly-technical CMS rule implemented these adjustments, with a transition period during January 1, 2016 – June 30, 2016, during which CMS used 50/50 blended rates. The 21st Century Cures Act extended the transition period through December 31, 2016, mandated that CMS study the impact of the CBP on beneficiary access to DME, and established additional factors for CMS to consider in making fee schedule adjustments effective beginning January 1, 2019. Fully-adjusted fee schedule rates went into effect January 1, 2017, with rates that were on average 50% lower than the unadjusted rates for all of the items and services subject to the adjustments (“Adjusted Rates”). Continue Reading

CMS Proposes $340 Million Increase in Medicare Hospice Payments for FY 2019

The Centers for Medicare & Medicaid Services (CMS) has published a proposed rule to establish FY 2019 Medicare hospice reimbursement rates and policies. The proposed rule would increase FY 2019 hospice rates by 1.8% ($340 million), based on the 2.9% inpatient hospital market basket update, which is reduced by both a 0.8 percentage point multifactor productivity adjustment and a 0.3 percentage point adjustment mandated by the Affordable Care Act. The annual update is reduced by 2 percentage points for hospices that fail to report required quality data. CMS proposes to update the FY 2019 hospice cap to $29,205.44, an increase of 1.8% over the 2018 level.

The proposed rule also would: codify a Bipartisan Budget Act of 2018 provision expanding the definition of attending physician to include physician assistants; make technical revisions to the regulatory definition of ‘‘cap period”; and revise hospice quality reporting program requirements, including the timeline for data submission, the measures reported, and how measures are displayed on Hospice Compare. CMS also describes monitoring activities to assess the impact of hospice reform policies finalized in the FY 2016 hospice final rule, and it reports on trends in hospice utilization and expenditures. Furthermore, as with the other FY 2019 Medicare payment proposed rules, CMS includes a Request for Information (RFI) on ways to promote interoperability and electronic healthcare information exchange, including through possible new or revised conditions of participation. CMS will accept comments on the proposed rule and the RFI until June 26, 2018.

Medicare OPPS Advisory Panel to Hold Annual Meeting August 20-21, 2018

CMS is holding its annual Advisory Panel on Hospital Outpatient Payment meeting on August 20-21 2018.  The Panel advises CMS on ambulatory payment classification clinical integrity and weights, along with hospital outpatient therapeutic services supervision issues.  The deadline for presentations and comments is July 23, and registration runs through July 30.

CMS Proposes FY 2019 Medicare IPPS/LTCH Rates and Policy Changes

The Centers for Medicare & Medicaid Services (CMS) has published its proposed rule updating the Medicare acute inpatient prospective payment system (IPPS) and long-term care hospital (LTCH) prospective payment system (PPS) for fiscal year (FY) 2019. The proposed rule also includes a request for information (RFI) on ways CMS can enhance interoperability in the health care system, along with a comment solicitation on ways to improve price transparency.  The agency will accept comments on the proposed rule and RFI through June 25, 2018.  The following are highlights of the sweeping regulation.

1.75% Increase in Medicare Acute Hospital Rates. CMS projects that total IPPS payments will increase by about $4.1 billion in FY 2019 compared to FY 2018 levels under the proposed rule.  The IPPS national standardized amount would increase by 1.75%, based on a projected 2.8% market basket update that is reduced by a 0.8% multifactor productivity adjustment; further reduced by 0.75% as mandated by the Affordable Care Act (ACA); and increased by 0.5% as required by the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA). CMS also proposes to boost uncompensated care payments, capital payments, and low-volume hospital payments. Continue Reading

CMS Proposes FY 2019 Medicare Inpatient Psychiatric Facility Rates, Requests Feedback on Future IPF PPS Refinements

CMS has issued a proposed rule to update rates for Medicare services furnished by inpatient psychiatric facilities (IPFs) during FY 2019. CMS estimates that the proposed rule would increase payments by $50 million (0.98%) compared to FY 2018 levels. This projected increase is a result of a 2.8% market basket update, reduced by both a 0.80 percentage point productivity adjustment and a statutorily-mandated 0.75 percentage point reduction, which is further reduced by 0.27 percentage points due to an outlier fixed-dollar loss threshold adjustment. CMS proposes to update the IPF prospective payment system (PPS) federal per diem base rate from $771.35 to $782.01; the base rate would be $766.56 for providers who fail to report required quality data. Among other things, CMS provides an update on the status of IPF PPS refinements and solicits comments about differences in the IPF labor mix, patient mix, and provision of drugs and laboratory services to inform these refinements.

As in the acute inpatient PPS proposed rule, CMS includes a Request for Information to obtain feedback on policies to promote interoperability and electronic healthcare information exchange, including through possible revisions to hospital conditions of participation. CMS will accept comments on the proposed rule until June 26, 2018.

Congress Approves Novel Use of Congressional Review Act to Invalidate Agency Guidance Document; Potential New Avenue of Relief for Health Industry?

As we reported on April 20, 2018, the Senate recently approved a joint resolution of disapproval under the Congressional Review Act (CRA) invalidating a five-year-old guidance document issued by the Consumer Financial Protection Bureau. It marked the first time in which a House of Congress invoked the CRA to invalidate something other than a formal regulation recently promulgated by an agency.

Moments ago, the House of Representatives followed suit by approving the joint resolution of disapproval. The White House has signaled that President Trump will sign the measure.

Given federal agencies’ widespread use of guidance documents in policy making, members of the health care industry should take note that the CRA now represents an additional tool for those looking to invalidate agency guidance documents that exceed the issuing agency’s statutory authority and/or impose unnecessary burdens.

HHS Weighing Additional 1-Year Delay in 340B Ceiling Price/CMP Rule Implementation

The Department of Health and Human Services (HHS) is seeking comments on an additional delay in the effective date of the January 5, 2017 Health Resources and Services Administration (HRSA) final rule addressing calculation of the ceiling price and application of civil monetary penalties under the 340B drug pricing program. Specifically, HHS proposes to push back the rule’s effective date from July 1, 2018 to July 1, 2019. HHS is proposing this action “to allow a more deliberate process of considering alternative and supplemental regulatory provisions and to allow for sufficient time for additional rulemaking.” However, the agency only provided a 15-day comment period, through May 22, 2018.

In a related development, HHS has withdrawn from White House Office of Management and Budget consideration a proposed rule that would have amended certain provisions of the January 5, 2017 340B ceiling price regulations.

CMS Floats Concept of Direct Provider Contracting Innovation Model, Posts Comments on “New Direction” RFI

Last fall, CMS requested public comments on the CMS Innovation Center’s “New Direction,” under which CMS will seek to “promote patient-centered care and test market-driven reforms.” In the interest of transparency and to facilitate discussion, CMS has posted a summary of the more than 1,000 comments it received from medical societies, providers, manufacturers, and other organizations in response to this solicitation.

CMS also has outlined its next potential innovation model — the “direct provider contracting” (DPC) model. Under this concept, CMS would directly contract with primary care or multi-specialty group practices that would agree to be accountable for the cost and quality of care of a defined beneficiary population. For instance, under a primary care-focused DPC model, CMS could pay primary care practices a fixed per beneficiary per month (PBPM) payment to cover applicable primary care services (e.g., office visits, certain office-based procedures, and other non-visit-based services covered under the physician fee schedule), and CMS would provide “flexibility in how otherwise billable services are delivered.” In addition to the fixed PBPM payment, practices could earn performance-based incentives linked to cost and quality. CMS also could test ways to reduce administrative burden through changes to claims submission processes for related services. CMS notes that it could consider multiple models, including Medicare Advantage and Medicaid models. CMS poses a series of detailed questions intended to guide development of the DPC model in a request for information (RFI); comments on the RFI are due May 25, 2018.

State Attorneys General Zero in on Elder Abuse, Health Services Industry Practices

The 2018 National Association of Attorneys General (NAAG) Presidential Initiative, “Protecting America’s Seniors: Attorneys General United Against Elder Abuse,” has come to a close with a summit held April 17-18 in Manhattan, Kansas, capping off an eight-month campaign during which state AG offices have augmented and sharpened their tools for investigating exploitation of this vulnerable population.

The initiative, selected by current NAAG president  Derek Schmidt, Kansas Attorney General, has brought AGs from around the country together to build state expertise on this issue and to fight elder abuse, neglect and exploitation. It has included a focus on nursing homes and other parts of the health industry that affect the elderly. Continue Reading

OIG, DOJ Announce FY 2017 Health Care Fraud and Abuse Control (HCFAC) Program Recoveries

Federal health fraud recoveries for FY 2017 totaled $2.6 billion, according to the latest HCFAC program annual report, compared to $3.3 billion in FY 2016. The Department of Justice (DOJ) opened 967 new criminal health care fraud investigations in FY 2017, filed criminal charges in 439 cases involving 720 defendants, obtained convictions of 639 defendants for health care fraud-related crimes, and opened 948 new civil health care fraud investigations. Furthermore, HHS Office of Inspector General (OIG) investigations resulted in 788 criminal actions and 818 civil actions related to Medicare and Medicaid, along with the exclusion of 3,244 individuals and entities from participation in Medicare, Medicaid, and other federal health care programs.

The OIG identifies the following priority areas for HCFAC funding: protecting beneficiaries from prescription drug abuse; enhancing program integrity in non-institutional care settings (e.g., home health and hospice); improving oversight of the MA program; and strengthening Medicaid program integrity.  The HCFAC report also observes that health care fraud investigations are considered a high priority within the Federal Bureau of Investigations (FBI) Complex Financial Crime Program, with each FBI field office having personnel assigned specifically to investigate health care fraud matters.

Congressional Hearings Focus on Health Care Innovation, Medicaid Fraud, Health Policy Legislation – But Spotlight Remains on Opioids

Congressional committees with jurisdiction over health care legislation continue to focus on the opioid crisis:

In other policy areas: Continue Reading

2019 Medicare Advantage/Part D Policies Finalized, Including Comprehensive Addition and Recovery Act Drug Management Requirements

CMS has announced final Medicare Advantage (MA) and Part D plan policies and rates for 2019. The final 2019 rule, published on April 16, 2018, implements a Comprehensive Addiction and Recovery Act (CARA) provision that allows Part D plan sponsors to establish drug management programs. Under this policy, plan sponsors may limit at-risk beneficiaries’ access to coverage of “frequently abused drugs” (opioids and benzodiazepines) to selected prescribers and/or network pharmacies, and they may use of point-of-sale claim edits, subject to various conditions.

Other policies adopted in the final rule include the following: Continue Reading

Congress Poised to Invalidate Agency Guidance Document in Unprecedented Use of the Congressional Review Act – Could it Provide a Roadmap for Relief for the Health Industry?

The Congressional Review Act (CRA) was long viewed as something of a paper tiger, and for good reason. The CRA requires agencies to submit certain rules to Congress before they go into effect. The CRA also creates a streamlined process for Congress to rescind such rules through the passage of a “joint resolution of disapproval” that is not subject to filibuster in the Senate. However, that rescission process had only been successfully used once between 1996 (the year of the CRA’s enactment) and 2016.

That all changed in 2017. During that year, Congress successfully invoked the CRA to rescind 15 different rules, almost all of which were issued shortly before the end of the Obama Administration. The two exceptions were rules issued by the Consumer Financial Protection Bureau (CFPB) prior to the November 2017 departure of its then-Director, Richard Cordray, who had been appointed by President Obama.

Because the CRA establishes a relatively short timeframe for Congress to invoke the rescission process following the publication of a rule, many had assumed that the CRA would return to obscurity for the time being given that the same political party currently controls the Executive and Legislative Branches. But what if publication of a rule is not the only event that can trigger CRA review? The word “rule” as used in the CRA actually is broadly defined to include an “agency statement of general . . . applicability and future effect designed to implement, interpret, or prescribe law or policy . . . .” (Emphasis added.) In other words, the definition of “rule” used by the CRA is not limited to formal regulations promulgated after notice-and-comment rulemaking.

What, then, about a guidance document that an agency issued several years ago yet never submitted to Congress for review under the CRA? The short answer is that if the Government Accountability Office (GAO) determines that the guidance document is a “rule” within the meaning of the CRA, it is the date of GAO’s determination—not the date of original issuance—that starts the clock for Congress to invoke the process of rescission under the CRA.

GAO issued such a determination in December 2017 with respect to a CFPB guidance document issued in 2013 involving automobile lending practices. On April 18, 2018, by a vote of 51 to 47, the Senate approved a joint resolution of disapproval rescinding the CFPB guidance document. The House of Representatives is expected to follow suit in the coming days, and President Trump is expected to sign the joint resolution of disapproval.

It remains to be seen what, if any, other guidance documents may garner the congressional attention necessary to invoke the CRA process. However, given the prevalence of guidance documents in the health industry—and the extreme unpopularity of certain such documents—recent events may spark similar efforts to invoke the CRA in the months to come. If the CRA is successfully invoked to overturn the CFPB guidance document, those in the health industry may be well-advised to identify such things as burdensome manual provisions and other sub-regulatory guidance worthy of similar treatment.

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