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What Happened, What You Missed: July 26-30

New CDC Guidance Say Vaccinated People Should Wear Masks Indoors

On July 27, the Centers for Disease Control and Prevention (CDC) issued updated guidance that advises fully vaccinated people to wear masks in “pubic, indoor settings” in counties with “substantial” or “high” levels of COVID-19 transmission.  The guidance also calls for all students, teachers, and staff at K-12 schools to wear masks, regardless of vaccination status.  CDC says it updated the guidance on masking in response to the high transmissibility of the Delta variant as well as new data that shows vaccinated people who catch COVID-19, but are asymptomatic, can spread the Delta variant just as easily as those who are unvaccinated.  Since the new guidance was released, several jurisdictions including Washington, DC and Chicago have issued new requirements for vaccinated individuals to wear masks when indoors.

Biden Announces New Vaccinations and Testing Requirements for Federal Workforce

On July 29, President Joe Biden announced new requirements for all civilian federal employees, onsite contractors, and military servicemembers to be vaccinated or otherwise face regular testing, masking, and social distancing requirements.  Biden first hinted at a vaccine mandate for federal workers on Tuesday following the CDC’s announcement on its new masking guidelines for vaccinated people. However before his announcement, on Monday the Department of Veterans Affairs announced it will require its frontline health care workers to be vaccinated within eight weeks.

Pfizer Says Vaccine Efficacy Wanes after 6 Months, Makes Case for Third Dose

On July 28, Pfizer released a new study that showed the overall effectiveness of its two-dose COVID-19 vaccine declined from 96% to 84% after six months.  Pfizer separately released data on Wednesday that found a third dose of its vaccine increases antibody levels against the Delta variant by nearly five times for people ages 18 to 55 and more than 11 times among people 65 to 85.  However, it remains unclear if higher antibody levels actually lead to better protection, and the CDC has stated that currently approved vaccines provide adequate protection against the Delta variant.  Pfizer also announced that it plans to seek emergency authorization use under the Food and Drug Administration for a third dose sometime in August.

Senators Reach Agreement on $550 Billion Infrastructure Package

On July 27, a bipartisan group of Senators reached agreement on a $550 billion infrastructure bill that would provide $550 billion in new spending for roads, bridges, rail transit, clean water, broadband internet, airports, and environmental clean-up.  The bill would be partially paid for by repurposing COVID-19 relief funds and delaying implementation of the Medicare Part D drug rebate rule.  Next, the Senate is expected to hold a vote on Friday and work through the weekend.  Progress on the bipartisan infrastructure bill means Democrats can now  move on and focus solely on their $3.5 trillion human infrastructure bill that they intend to pass through budget reconciliation.

Former WY Sen. Mike Enzi Dies after Bicycle Accident

Former Wyoming Republican Senator Mike Enzi died on July 26 at age 77 due to injuries sustained from a bicycle accident just days before.  Enzi served as the Mayor of Gillette, WY and as a State Lawmaker before being elected to the Senate in 1996, where he would go on to serve four terms before retiring in 2020.  Known as one of the more conservative members of his party, Enzi served as Chairman of the Senate Budget Committee and Senate Health, Education, Labor and Pensions Committee.

ICYMI: Athletes from the Nation’s Capital Shine in 2020 Olympics

Aside from being home to our nation’s capital, the Washington, DC area is home to nearly a dozen members of the US Olympic Team who are currently competing in the 2020 Summer Olympics in Tokyo, Japan.  Probably the most well-known is 24-year-old swimmer Katie Ledecky, a Bethesda, MD native who won a gold medal in the 1500-meter freestyle  plus two silver medals in different swimming events.  Ledecky is joined on the 2020 US Olympic Swim Team by two other area natives – Torrie Huske of Arlington, VA and Phoebe Bacon of Chevy Chase, MD. (https://whyinstitute.com/)   Other Team USA athletes include several basketball players from the Washington Wizards and Washington Mystics, as well as two members of the women’s soccer team, Washington Spirit.

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What’s in the Surprise Billing Rule, and What Happens Next?

It’s the beginning of the end for surprise medical bills.  On July 1, the Biden-Harris Administration through the Department of Health and Human Services (HHS), the Department of Labor, and the Department of the Treasury (collectively known as the Departments), along with the Office of Personnel Management (OPM), released an interim final rule as a first step in implementing the No Surprises Act that was signed into law as part of the omnibus appropriations package in late 2020.  However, the regulations won’t go into effect until January 1, 2022, and stakeholders can provide comments by September 7.

What’s In the Rule?

Below are the provisions in the interim final rule that establishes new protections from surprise billing and excessive cost-sharing for consumers receiving health care items and services.

  • Surprise billing will be banned.  The interim final rule bans out-of-network charges for emergency services, regardless of location.  Providers are required to bill emergency services on an in-network basis without prior authorization. The rule also prohibits surprise billing for ancillary services at in-network facilities in all cases, including anesthesiology services.
  • Patients must consent to waive balance-billing protections. The rule directs federal agencies to establish a process to allow patients to waive their balance-billing protections and consent to out-of-network charges.  Notably, providers are not allowed to request patient consent in three scenarios: (1) The provider provides an ancillary service not selected by the patients, such as a radiologist or anesthesiologist; (2) there are no in-network providers available at the facility; or (3) the service is urgent or arises from unforeseen circumstances.
  • Insurers have 30 days to issue an interim payment or notice of denial from insurers. The interim final rule requires health plans to make an initial payment or issue a notice of denial to providers in 30 days after it receives a clean claim.
  • CMS must determine the qualifying payment amount. The rule calls on the Centers for Medicare and Medicaid Services (CMS) to define the qualifying payment amount (QPA), which will calculate patient cost-sharing and be used by an arbitrator in the independent dispute resolution process. The rule addresses several factors that will determine how the rates are set, including the type of contract, insurance market, geographic region, and rates for same or similar services.
  • Insurers must provide more transparency.  The interim final rule requires health plans to take several steps to promote price transparency and by requiring them to provide an advanced explanation of benefits, transitional continuity of coverage when a provider leaves the network, and access to accurate provider network directories.

What’s Next?

The interim final rule issued on July 1 is only the first step in a multipart regulatory process, as the Departments will need to issue two additional rules to fully enact the No Surprises Act.

By October 1, the Departments are required to put forth a rule on an audit process to ensure that plans and insurers are complying with the QPA calculation and requirement.  The audit may be performed by federal or state officials, depending on who is enforcing the surprise bill.  Enforcement follows the same rules as the Affordable Care Act, with the federal government tasked with enforcing self-insured group health plans, while states may enforce rules over non-group health plans and fully insured employer-sponsored plans.  The rule expected by October 1 will contain details on how the auditing process will work as well as how federal agencies will address enforcement.

By December 27, the Departments must outline through rulemaking the details of an independent dispute resolution (IDR) process that providers and health plans can opt for if they fail to reach an agreement on an out-of-network rate.  The IDR process is characterized as binding, baseball-style arbitration, meaning the arbitrator must select one party’s offer.  Federal regulators face the challenge of setting up an IDR process that’s considered fair but doesn’t cause providers and insurers to overuse the process and incur higher administrative costs.  The details of the IDR process have been debated repeatedly among stakeholders and are considered to be the most consequential part of the No Surprises Act.

What Are the Reactions?

Initial reactions to the interim final rule suggest the rule favors employers and insurers over hospitals.  The American Benefits Council, an organization who advocates for employer-sponsored plans, applauded the publication of the  interim final rule as it included many of the organization’s recommendations. However, the council noted that many key issues won’t be addressed until the release of the rule on the IDR process.  One fundamental issue the council cited is confirmation that either party participating in IDR can defer the QPA except in extenuating circumstances.  Similarly, the ERISA Industry Committee applauded the rule for “taking a firm stand” to protect Americans from surprise billing and address high health care costs.  In contrast, the California Medical Association said it has “serious concerns” about the new regulations, specifically as they pertain to the QPA, although the organization declined to specify its concerns.

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What Happened, What You Missed: June 28-July 2

Walensky: Vaxxed People Don’t Need to Mask Up for Delta

In a June 30 interview on Good Morning America, Centers for Disease Control and Prevention (CDC) Director Rochelle Walensky said fully vaccinated people are safe from the Delta variant of COVID-19 and do not need to wear masks.  Walensky’s comments follow recommendations issued by the World Health Organization (WHO) on June 25 that urge even fully vaccinated people to wear masks and practice social distancing.  According to former Senior Advisor to the COVID-19 Response Coordinator Andy Slavitt, the differences between the WHO and CDC guidance can be attributed to the fact that the former concerns the entire globe, where vaccination rates in most countries are rather low, while the latter concerns the US, where vaccination rates are relatively higher.  Still, some jurisdictions are adding their own recommendations on top of the CDC’s.  On June 28, Los Angeles public health authorities recommended that all residents wear masks indoor regardless of vaccination status out of concern for the more transmissible Delta variant.  Similarly, Illinois Governor J. B. Pritzker suggested on June 29 that Illinois vaccinated residents consider masking up if they enter a “very crowded area.”  However, neither jurisdiction has officially reinstated a mask mandate.

Researcher Say It’s Okay to Mix COVID-19 Vaccines

A study from Oxford University released on June 29 found mixing doses of Pfizer’s mRNA vaccine and AstraZeneca’s viral vector vaccine yielded a strong immune response against COVID-19.  According to the study, a dose of AstraZeneca and a dose of Pfizer administered four weeks apart regardless of order generated higher T-cells and antibodies than the standard two-dose AstraZeneca regimen.  The study’s findings come as more and more public health experts say a booster shot of Pfizer or Moderna’s mRNA vaccine may be needed to augment the protection offered from Johnson & Johnson’s single-dose vaccine, which is also based on viral vector technology.

Biden Administration Announces New Proposals to Boost ACA Enrollment

On June 28, the Centers for Medicare and Medicaid Services (CMS) announced several plans to bolster the Affordable Care Act (ACA) in its proposed rule, which sets forth the proposed revised 2022 user fees for insurers offering plans on the ACA exchanges.  Among the changes the Administration is proposing includes extending open enrollment season by 30 days, eliminating the sign-up window for Americans who earn under 150% of the federal poverty level, and providing navigators $80 million for the next enrollment season by increasing insurers’ user fees by half a percentage point.  CMS is also notably proposing to reverse a policy finalized earlier this year by the previous Administration that would have allowed states to turn their insurance marketplaces over to private brokers and agents.

ICER: New Alzheimer’s Drug Not Effective Enough to Justify High Price

The Institute for Clinical and Economic Review (ICER) issued a revised evidence report on June 30 saying that Biogen’s recently approved Alzheimer’s drug, Aduhelm (aducanumab), isn’t effective enough to legitimize its $56,000 price tag.  Instead, the group says the drug should be valued at $3,000 to $8,400 per year for patients with early-stage Alzheimer’s disease.  The group also found that Aduhelm’s “harms outweigh any potential benefits” for patients with more severe Alzheimer’s.  Aduhelm has come under increased scrutiny after the Food and Drug Administration (FDA) approved the drug despite the fact that one of the Aduhelm’s two phase 3 clinical trials failed to show positive efficacy.

Pew: Suburban Voters, White Men, and Independents Helped Biden Win

A new analysis of the 2020 president election by Pew Research Center found  that a larger share of suburban voters, white men, and independents helped deliver a victory to Joe Biden, while Republicans gained the support of more Hispanic voters.  Pew’s report is considered more accurate than exit polls because it matches survey data with state voter records.

ICYMI: Intelligence Officials Can’t Explain UFOs

On June 25, the Office of the Director of National Intelligence released a highly-anticipated report on UFOs, or unidentified ariel phenomena (UAP) in the military’s parlance.  Out of 144 UAP sightings listed, the report was only able to come up with an explanation for one, which was ultimately identified as a “large, deflating balloon.”  According to the report, the other 143 unexplained sightings fall into one of five categories: airborne clutter, natural atmospheric phenomena, US government developmental programs, foreign adversary systems, and a “catchall ‘other’ bin.”  The report notably states that UAPs may pose a challenge to national security, and the number of incidents may be under-reported due to the stigma associated with UFOs.

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What Happened, What You Missed: June 21-25

President, Senators Reach Tentative Deal on Infrastructure

On June 24, President Joe Biden and a bipartisan group of 21 Senators reached an agreement on a sweeping $1.2 trillion infrastructure package that includes $579 billion in spending on physician infrastructure projects to improve roads, rail, broadband internet, and utilities.  With the backing of 11 moderate Republican Senators and 10 Democratic Senators, the proposal could presumably pass the Senate with the 60 votes needed to overcome a filibuster, provided all Democratic Senators support the measure.  However, Biden announced will only sign a physical infrastructure bill if a “human infrastructure” bill that support investments in childcare, paid leave, and caregiving is advanced in tandem.  The latter proposal contains policies popular with Democrats that can only likely pass the Senate through budget reconciliation.

White House Projects It Will Miss July 4th Vaccination Goal

On June 22, the White House Coronavirus Response Coordinator Jeff Zeints said the US is unlikely to meet its goal of at least partially vaccinating 70% of adults by July 4th.  In recent weeks, the pace of vaccinations has slowed, particularly in the South and Midwest and among Americans aged 19-26.  At the moment, 70% of Americans aged 30 and up have received at least one dose.  Public health officials are urging all Americans to get vaccinated as the more contagious Delta variant spreads.

Senate Republicans Block Voting Rights Bill

Senate Republicans invoked the filibuster to block Democrats’ For the People Act, a sweeping voting rights package that aimed to create national standards for early voting, ban partisan gerrymandering of congressional districts, and create a new public campaign financing system.   According to Senate GOP leaders, the bill represents a “power grab” that would undermine states’ abilities to oversee elections and pave the way for permanent Democratic control of Congress.  While Democrats contend their efforts on voting reform are far from over, there does not appear to be a strategy to realistically advance voting rights legislation so as long as the filibuster remains in place.

CDC ACIP Says Heart Inflammation an “Extremely Rare Side Effect”

On June 23, members of the Center for Disease Control and Prevention’s (CDC) Advisory Committee on Immunization Practices (ACIP) determined cases of heart inflammation in adolescents and young adults are likely related to mRNA COVID-19 vaccines produced by Pfizer and Moderna.  According to the CDC, there have been 1,226 reports of heart inflammation following the administration of roughly 300 million mRNA vaccine doses.  Fortunately, the cases were reported to be mild and resolved quickly.  Based on this information, ACIP members concluded that the side effects are “extremely rare” and urged all eligible people to continue to be vaccinated.

ICYMI: Star Wars X-Wing Fighter Getting Prepped for Smithsonian Appearance

An X-Wing starfighter prop used in production of the Star Wars sequel trilogy (2015-2019) is currently undergoing conservation at the Restoration Hangar of the Smithsonian’s Steven F. Udvar-Hazy Center in preparation to be displayed in the National Air and Space Museum in late 2022.  While the National Air and Space Museum is closed to visitors until July 31, Star Wars aficionados can purchase timed tickets to view the X-Wing at the Udvar-Hazy Center.  The X-Wing is on loan to the Smithsonian from Lucasfilm indefinitely.

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What the Rulemaking Process Means for Surprise Billing

The battle among healthcare stakeholders over how to address the issue of surprise medical bills isn’t over.  The FY 2021 omnibus appropriations bill passed at the end of last year included the No Suprises Act, language designed to alleviate financial burdens on patients that can result largely when patients see out-of-network providers.  The next step will be the Department of Health and Human Services’s (HHS) release of a rule to implement the new federal law that sets up guardrails for providers and insurers alike.    Patient groups and health care stakeholders have been working with the agency  to try shape the law in their favor.  What can we expect?

Timeline

With the first part of the interim final rule due July 1, 2021, it looks like the government is likely to meet its statutory deadline. The Centers for Medicare and Medicaid Services (CMS) sent the draft to the Office of Management and Budget for review on June 8.  By law, the ban on surprise billing is scheduled to go into effect on January 1, 2022.

Surprise Billing Part One

The law sets up a multi-part regulatory process — the July 1st rule is expected to contain details on how plans will calculate the qualifying amount to determine a patient’s cost-sharing obligation for out-of-network medical bills.  The rule is also anticipated to include guidance regarding notice and consent requirements that government how an out-of-network providers should obtain a patient’s consent before treating the patient.  Two additional deadlines for agency rulemaking this year are: 1) October 1, to establish a process to audit health plans for compliance; and 2) December 27, creating an independent dispute resolution (IDR) process.

Questions for the Rulemaking Process

Many provisions of the new law will depend on regulatory interpretation and guidance, leaving the agency to  fill in the details. Two key policy areas stakeholders are closely watching including how rates will be calculated and patient consent to treat by out-of-network providers will be obtained.

Rates.  CMS will determine how insurers should calculate the initial payment to out-of-network providers before either party agrees on a final cost.  Determining this rate will be no easy feat, as provider payment rates for health care services are the result of negotiations between insurers and providers and can vary plan by plan and provider by provider.  Providers may favor leverage gained in these negotiations under the new law that could result in higher payments.

Dispute Resolution Process.  If a provider and a health plan fail to reach an agreement on an out-of-network rate, either party can opt for a binding, baseball-style IDR process whereby the arbitrator must select one party’s offer.  During the IDR process, the arbitrator may consider several kinds of information, including median in-network rates, case mix, and the complexity of the service. The HHS, Labor and Treasury departments face the challenge of setting up an IDR process that is considered fair but doesn’t drive providers and insurers to overuse the process.  Based on experiences with New York state’s IDR process, some experts fear an overreliance on arbitration could lead to higher health care costs.

Consent.  Out-of-network providers must obtain consent from patients seeking treatment for non-emergency services before treatment can begin.  Exceptions apply to anesthesiologists, pathologists, radiologists and other specialists that are among the largest sources of surprise bills.  There is concern about the potential for loopholes that might still allow patients to receive surprise bills, especially in the case where an out-of-network provider must obtain consent from a patient before treatment.  While requiring patients to provide consent may be well-intended, the US Public Interest Research Group points out that requiring consent essentially puts the patient back in the middle, counter to the goals of thelaw.

Other areas of regulatory interpretation are expected to include how to monitor and punish providers who violate the ban, and how to address situations where patients cannot meaningfully consent to out-of-network care, such as emergency care.

What Stakeholders Are Saying

From the beginning of the year, health care stakeholders have shifted their lobbying efforts from the Hill to federal agencies.  Since March, HHS has been holding calls with stakeholder organizations to obtain feedback.  Additionally, several organizations have written to HHS with their recommendations for implementation.  Below are some key requests from organizations that have written to the Department.

The American Association of Orthopaedic Surgeons (AAOS) voiced support for using an in-network median rate based on the rate for all local health plans and not simply the products of the insurer during the IDR process.  AAOS also suggested creating specific criteria for determining what constitutes “good faith” to show that physicians have adequately engaged in the IDR process.

The Association of American Medical Colleges (AAMC) asked that HHS provide language or a template that out-of-network providers may use when obtaining permission from patients to provide medical services, as well as allow providers and health plans a minimum 30 days to kick off the IDR process and 30 days to submit their offer.  Notably, AAMC also recommended that HHS delay implementation of the surprise billing ban by at least one year due to the complexity of the law.

A group of 30 patient and disease organizations including the American Cancer Society and the American Heart Association recommend that states and HHS engage in enforcement action when cost estimates provided to a patient in advance of a medical procedures differ significantly from the billed charges.  The organizations also argue  that states should be required to report enforcement activities related to the law to the federal government.

Insurers are equally concerned about the implementation of the law.  A recent survey of 100 executives representing 85 different health payers found 64% are concerned about the timeline of implementation, echoing AAMC’s concerns.  Additionally, 95% expressed concern about the health care system’s ability to achieve compliance by the January 1, 2022 deadline.

All Eyes on the Administration

With critical rulemaking expected to begin to come out this year, , the fight over surprise billing is far from overHospitals and insurers are directing their attention at regulators and top agency officials to shape the new surprise billing law in their favor and will likely call upon Capitol Hill for help resolving any ongoing concerns.  This means the conversation in Washington on surprise billing is sure to continue even beyond the implementation of thenew law, as stakeholders continue to scrutinize it and the Administration releases guidance related to the law.  The outcome of the Administration’s rulemaking is also important because it will send a signal about how aggressively the Administration plans to regulate the health care industry.

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