Last Opportunity to Comment on New CMS Final Rule That Will Negatively Impact Home Infusion Reimbursement

The Centers for Medicare and Medicaid Services (CMS) has issued a notice in the Federal Register on the previously debated home infusion rule. The rule originally proposed in July focused primarily on two sections, “Requirements for Home Infusion Suppliers” and “Accreditation for Home Infusion Therapy Suppliers.” The rule as written has the potential to drive Medicare and Medicaid beneficiaries to more hospitals and nursing home visits, thus increasing costs.

The “Requirements for Home Infusion Suppliers” section has caused the most industry concern since it includes definitions for an infusion drug administration calendar day and the required services of a home infusion supplier. This part of the rule states:

Therefore, we proposed to define in regulation that ‘infusion drug administration calendar day’ refers to payment for the day on which home infusion therapy services are furnished by skilled professional(s) in the individual’s home on the day of infusion drug administration. As we stated in the proposed rule, we believe this to mean skilled services as set out at 42 CFR. 409.32. This regulation states that the skilled services furnished on such day must be so inherently complex that they can only be safely and effectively furnished by, or under the supervision of, professional or technical personnel.”

The new final rule also describes how CMS will maintain its prior proposed limit on reimbursement to “the day on which home infusion therapy services are furnished by skilled professionals in the individual’s home.” Additionally, the final rule summarizes the case-mix methodology refinements for home health services beginning on or after January 1, 2020, which includes the elimination of therapy thresholds for payment and a change in the unit of payment from a 60-day episode to a 30-day period. These final rule changes are materially negative to private home infusion companies.

Fortunately, CMS is allowing the industry one last chance to issue comments on this final rule. The comment period ends on December 31, 2018.

This is the industry’s last opportunity to voice concerns to CMS regarding the negative impact of this final rule. Frier Levitt Government Affairs, LLC (FLGA) can help practices formulate their concerns to send to CMS, as well as help create a strategy if CMS maintains its position. Contact FLGA today to plan your next steps before the December 31st deadline.

New CMS Payment Model Will Impact Hospitals, Manufacturers, and Infusion and Oncology Providers

CMS IPI Blog Post

The Centers for Medicare and Medicaid Services (CMS) has announced a new payment model that seeks to reduce out of pocket costs for patients. This payment model arises out of the Administration’s American Patients First Blueprint that was released earlier this spring. CMS is providing this notice of its new proposed payment model via an Advance Notice of Proposed Rulemaking, meaning the formal proposed rule will be introduced in the immediate future.

CMS’ proposal to lower drug prices will be in three stages. First, the agency will be introducing the “international pricing index” (IPI payment model) where Medicare’s payments for select physician-administered drugs covered under Part B would shift to a level more closely aligned with prices in other countries. Overall savings for American taxpayers and patients are projected to total $17.2 billion over five years. The IPI model would apply to 50 percent of the country, and would cover most drugs in Medicare Part B, which includes physician-administered medicines such as infusions. The model would draw on HHS analysis comparing the U.S. against 16 other nations to benchmark the selected drugs against.

Secondly, taking recommendations from MedPAC, the Administration will experiment with having private sector vendors negotiate with manufacturers for drug prices under the Medicare Part B program, to mimic how payers negotiate drug prices under Medicare Part D. This approach will be piloted in certain geographic areas where there will be mandatory participation for physicians and hospitals. Vendors under this proposal would aggregate purchasing, seek volume-based discounts, and compete for providers’ business, creating a competitive marketplace.

Lastly, CMS is attempting to change prescribing incentives for physicians to prescribe lower costs medications. Under CMS’ proposal, physicians will be transitioning away from a percentage reimbursement to a flat fee. This is mirrored on the reimbursement discussed under the previous Administration’s vision of a flat fee for oncologists, and an idea that has been consistently advocated since by MedPAC.

Impacted Stakeholders

CMS’ payment model policy shifts have the ability to severely impact several key stakeholders in the healthcare continuum, including:

– Manufacturers

– Wholesalers

– GPOs

– Hospitals

– Oncology Physicians

– Infusion Providers

– Healthcare providers administering medications covered under Part B

Frier Levitt Government Affairs (FLGA) helps clients and prospective clients identify opportunities and threats to your business models including changes to your reimbursement. With the backing of national boutique healthcare law firm Frier Levitt, LLC, FLGA can provide clients with in-depth comments to CMS on why this will have a negative effect on impacted stakeholders. Even though this proposal is planned for 2019 or 2020, it is essential for stakeholders to start planning their responses now to ensure that their voices are heard. Contact Frier Levitt Government Affairs today to get started.

The Current State of U.S. Biosimilar Policies – An Overview

This article was originally published on the Biosimilar Development website on October 17, 2018.

With the continued policy dialogue on how rising drug costs impact patient access, the theoretical cost savings that biosimilar medications may offer is intriguing to many policymakers as well as those in the industry. A recent IMS Institute Report found several interesting points regarding the potential of biosimilars:

– By 2020, biosimilars will start competing with original biologics that currently have sales of $50 billion annually.

– Biosimilar use in the European Union and United States may yield total savings of $56 to $110 billion over the next five years.

– Within three years, eight major biologic medicines are expected to lose exclusivity protection, including treatments for autoimmune disorders and diabetes.

– Healthcare systems, by opening markets to biosimilar competition, could realize a 30 percent reduction in price per treatment day compared with originator biologics.1

As the conversation about biosimilars and their potential cost savings continues, let’s examine what the U.S. Department of Health and Human Services (HHS), the Food and Drug Administration (FDA), and Congress have been doing recently to chart the developing course of biosimilar policies.

Trump Administration Takes Steps To Encourage Biosimilar Uptake

This spring, the administration released its blueprint to lower drug prices, “American Patients First,” which featured a discussion of greater biosimilar utilization. The blueprint called for key reforms in four areas: (1) improved competition, (2) better negotiation, (3) lower list prices, and (4) reduced out-of-pocket costs.

Unfortunately, we have yet to see any legislation out of the blueprint, but this could be due to where we are on the legislative calendar. Normally, toward the end of the year in a non-presidential election year, legislative activity tends to slow down, with only the most politically important issues maintaining momentum. Regardless of who wins control of Congress this fall, we could see much more biosimilar legislation driven by the blueprint, as well as the FDA, which continues to push for a cheaper prescription drug marketplace. This should be easier in 2019, as we will be more removed from election-driven politics.

Notwithstanding this, the blueprint described some actions that the Secretary of Health and Human Services can take to accomplish greater biosimilar utilization. According to the blueprint, thus far the administration has:

– Finalized “a policy in which each biosimilar for a given biologic gets its own billing and payment code under Medicare Part B, to incentivize development of additional lower-cost biosimilars. Prior approaches to biosimilar coding and payment would have created a race to the bottom of biosimilar pricing, while leaving the branded product untouched, making it an unviable market that few would want to enter.”

– Finalized “changes to the Medicare Prescription Drug Program in the 2019 Part C and Part D regulation,” allowing Medicare beneficiaries receiving low-income subsidies to access biosimilars at a lower cost.

The blueprint also alerted us to actions HHS may take as it continues to solicit comments on other policies it has under active consideration. One point to note is the difference between this administration and the last. The current administration has had its agencies rely more on requests for information rather than opting for the formalities within the regulatory process of proposing a rule.

A request for information is a tool used by agencies to solicit comments from interested stakeholders to provide the agency with the necessary technical aspects of complex topics. This allows agencies to determine if a formal rulemaking process will be promulgated on certain commonly commented on points. In this case, the comment period for the request for information ended in July 2018, with HHS currently reviewing the comments received. There is no anticipated date for next steps, so the public will have to wait until the next stage before discovering what the major points of interest are from the industry.

Specifically, HHS is seeking clarity from the industry on the following issues:

– Promoting innovation and competition for biologics. The FDA will issue new policies to improve the availability, competitiveness, and adoption of biosimilars as affordable alternatives to branded biologics. The FDA will also continue to educate clinicians, patients, and payers about biosimilar and interchangeable products as it seeks to increase awareness about these important new treatments.

– Samples for biosimilars and interchangeables. What actions should be considered to facilitate access to reference product samples by these companies?

– Resources and tools from the FDA: What specific types of information resources or development tools would be most effective in reducing the development costs for biosimilar and interchangeable products?

– Improving the Purple Book. What additional information could be added to increase the utility of the Purple Book?

– Educating providers and patients. What types of information and educational resources on biosimilar and interchangeable products would be most useful to healthcare professionals and patients to promote understanding of these products? What role could state pharmacy practice acts play in advancing the utilization of biosimilar products?

– Interchangeability. How could the interchangeability of biosimilars be improved, and what effects would it have on the prescribing, dispensing, and coverage of biosimilar and interchangeable products?

While all of these topics are important, in my opinion solid policies on interchangeability, biosimilar education, and formulary coverage would serve industry the best. First, having the clarity on whether interchangeability is feasible and what those points are will likely determine the speed at which we will see more biosimilars introduced into the marketplace. Second, educating physicians, pharmacists, and patients about the benefits of biological products will go a long way in ensuring marketplace comfort with these new protein-based medications. Last, understanding how payers and pharmacy benefit managers will manage these products is key in determining whether biosimilars will have an immediate impact on costs. Will payers and PBMs place these medications on higher tiers? How will rebates effect biosimilar utilization? Knowing this will help industry stakeholders determine their relevant pricing strategies to stay ahead of this emerging market.

Thus far, the FDA has been vocal about increasing biosimilar utilization as well. This summer witnessed FDA Commissioner Gottlieb release his Biosimilar Action Plan that addressed four key areas:

– Improving the efficiency of the biosimilar and interchangeable product development and approval process
– Maximizing scientific and regulatory clarity for the biosimilar product development community
– Developing effective communications to improve understanding of biosimilars among patients, providers, and payers
– Supporting market competition by reducing gaming of FDA requirements or other attempts to unfairly delay market competition to follow-on products

Additionally, the industry is closely watching the FDA’s direction for interchangeability, an important policy topic to address for market clarity, as it discusses how a biosimilar can be substituted for the brand biologic. Currently, there are still no interchangeable biosimilars, as the FDA continues to consider how to determine what biosimilar can be interchangeable with a particular biologic. At this point in time, it remains unclear when the industry will receive an answer on this.

Congressional Proposals On Biosimilars

So, what is Congress doing to address biosimilars? Congress has a few bills directly on point (listed below); however, it is questionable whether any of these will move due to the lateness of the legislative calendar.

– H.R. 6478, The Biosimilars Competition Act of 2018, seeks to enhance competition for prescription drugs by increasing the ability of the Department of Justice and the Federal Trade Commission (FTC) to enforce existing antitrust laws regarding biologic and biosimilar products. The act as proposed would essentially require biologic and biosimilar manufacturers to report “pay for delay” agreements, which are deals between biologic and biosimilar companies that ensure lower-cost medications are kept off the market for a certain time period. These deals, which have been frowned upon by the FTC and Congress, allow innovator companies to pay generic, or in this case biosimilar, companies not to bring cheaper alternatives to the market for a specified time. The federal government has been aggressively attacking these agreements as harmful to patient access to cheaper alternatives.

– S. 974/H.R. 2212, The Creating and Restoring Equal Access to Equivalent Samples Act of 2018, seeks to promote competition in the market for drugs and biological products by facilitating the timely entry of lower-cost generic and biosimilar versions of those drugs and biological products. This is another example of Congress going after pay for delay agreements to make more affordable drugs accessible to patients, assuming that biosimilar prices are proven to be consistently lower the biologics.

– H.R. 2051, FAST Generics Act of 2017, seeks to amend the Federal Food, Drug, and Cosmetic Act to ensure that eligible product developers have competitive access to approved drugs and licensed biological products, so as to enable eligible product developers to develop and test new products, and for other purposes. This bill is along the same theme as the aforementioned, as this bill echoes the attempt to provide patients access to lower-priced medications.

At this point, it seems that the Creating and Restoring Equal Access to Equivalent Samples Act of 2018 has the best chance of passing before the end of 2018, as it has been receiving the most favorable attention on Capitol Hill for quite some time. As mentioned above, however, the upcoming midterm elections make this highly unlikely.

It is very likely that we will see legislation addressing greater biosimilar utilization — either in the form of reintroduction of this session’s bills or entirely new bills — next year, regardless of who controls the House and Senate. However, with the uncertainty surrounding the midterms, it is difficult to predict which bills will emerge as “winners” next year. I also do not foresee any biosimilar policy development slowdown from either HHS Secretary Azar or FDA Commissioner Gottlieb, as greater biosimilar utilization remains a priority for them as a means to achieve lower prescription drug prices.

References:

  1. “IMS Health: Surge in Biosimilars to Drive Significant Change in Health System Costs, Patient Access and Competition by 2020.” Business Wire. March 2016. https://www.businesswire.com/news/home/20160329005296/en/IMS-Health-Surge-Biosimilars-Drive-Significant-Change

PHARMACY ALERT: New Model Act Looking to Have PBMs Overseen by State Insurance Commissioners Seeks Industry Comments

The National Council of Insurance Legislators (NCOIL) recently announced, through the leadership of NCOIL President and Arkansas Senator Jason Rapert, that the NCOIL Health, Long-Term Care and Health Retirement Issues Committee is taking a comprehensive look at Pharmacy Benefit Managers (PBMs). NCOIL is in the process of learning about how PBMs operate, with the goal of introducing an NCOIL Model Act to have PBMs overseen by each state insurance Commissioner. A draft of NCOIL’s Model Act has been circulating through the industry and NCOIL is actively looking for industry comments. The comment period closes November 6th.

National organizations serving specialty populations like oncology, national buying groups or GPOs, wholesalers, and even a retail/specialty pharmacy should consider engaging in this comment period. These stakeholders have the most to lose if PBMs continue to remain unchecked. State Insurance Commissioners are the regulatory authorities that create insurance policies in each respective state, making this even more urgent to get engaged. These comments can lead to the Commissioners enforcing better policies that finally level the playing field against PBMs.

Lack of PBM transparency has harmed too many interested stakeholders for far too long. Industry stakeholders should take immediate action with comment period for the NCOIL Model PBM Act ending soon. Frier Levitt Government Affairs can help organizations, pharmacies, GPOs, manufactures, and other industry stakeholders participate in this comment period by formulating specific issues with PBMs so that they can be voiced efficiently and effectively to NCOIL. If these comments are accepted and used by the various states, your business can be a direct beneficiary of new policies resulting in increased PBM transparency.

Contact Frier Levitt Government Affairs today for assistance in getting your voice heard.

The FOIA Request: An Unlikely Tool for Providers in the Age of Managed Healthcare

Since 1967, the Freedom of Information Act (FOIA) has provided the public the right to request access to records from any federal agency, often described as the law that keeps citizens “in the know” about their government. Managed and overseen by the Office of Information Policy within the U.S. Department of Justice, Federal agencies are required to disclose any information requested under the FOIA, unless it falls under one of nine exemptions which protect interests, including personal privacy, national security, and law enforcement. The FOIA also requires agencies to proactively post online certain categories of information, including frequently requested records.

FOIA requests can be used to keep healthcare and life sciences industry stakeholders informed and can provide strategic advantages, even in the context of disputes between private parties. For example, a pharmacy that has been denied access into a network can use FOIA requests to not only understand why they have been denied network access, but also understand how many other pharmacies it has happened to. While private entities like Pharmacy Benefit Managers (PBMs) may not be willing to disclose this information, it may be easily and legally discernable through a FOIA request to CMS. This information can be used to help support legal claims against a PBM or insurer.

Though FOIA requests can be submitted by virtually anyone, it takes time and effort to submit and follow up on. Many FOIA requests can be rejected on the basis that the requested material is not correctly specified, so it is imperative that the request properly identify the specific information sought. If the request is filed properly and is successful, knowing what to do with this information is the most important part of the process.

Frier Levitt Government Affairs assists healthcare and life sciences industry stakeholders formulate FOIA requests and use the information to help maximize your business interests, including predicting trends and future threats to their bottom line. Contact us today to get started.

The End of Summer is the Right Time for Strategic Planning in the Healthcare and Life Sciences Industries

The end of summer is traditionally a slow time during the legislative calendar. Most of the state governments have adjourned and historically members of Congress escape the D.C heat to head back home to their districts. This time of year can be a great time for companies and organizations looking to get more involved with their legislators to contemplate a plan to introduce themselves to legislators in the district. Additionally, with the power in Congress potentially hanging in the balance due to the upcoming mid-term elections this coming November, opportunities abound for companies and organizations that are aggressive in proactive government affairs planning.

Seldom has there been a time of greater policy and regulatory change in healthcare. An active HHS Secretary has been pushing policies such as importation, greater Medicare negotiating power, which is being proposed through a possible merger of Medicare Parts B and D, utilization of step therapy protocols, investigation of Pharmacy Benefit Managers. In addition, an active FDA is pushing for greater generic utilization, challenges to drug pricing and friendlier biosimilar policies. The recent policy changes will have a lasting impact on the healthcare and life sciences industries, and typically state legislatures enact state laws that address the same topics and are often have substantial impact on Providers.

The last year has also witnessed CMS’ increasing reliance on issuing Requests For Information (RFIs). This rulemaking process involves a proposed rule from the agency outlining the regulation CMS is looking to either add or change. Proposed rule announcements are usually followed by a comment period, public workshops/hearings, a final comment period and then a final rule with effective date. The RFI process provides opportunities for the industry to comment on the technical aspects of a proposal. However, the Administration is using agencies like CMS to distribute RFIs as a way for the industry to guide the conversation on what should be included. This could provide your organization with another way to influence policy, giving you even more reasons to take this “quiet” time during the legislative calendar to contemplate strategy.

The end of summer should be used to evaluate every healthcare stakeholders’ priorities and to design a game plan for achieving government affairs strategies and results. Each company or organization should consider how it is positioned for the upcoming elections. Are you comfortable with how your state and federal government interests are being advocated? Is your company or association prepared for different policies if Democrats take control of a particular house of the legislature? Lastly, what has been your organization’s philosophy for government engagement? Have you let your industry competitors or trade associations take the lead? While you may indirectly benefit from these actions, you should consider how whether the discourse aligns with your interest. Consider getting more active with strategic consulting, lobbying, PAC formations or undergoing an aggressive issue management program.

Frier Levitt Government Affairs, LLC, works with all types of companies and organizations across the healthcare and life sciences spectrum to help them stay ahead of the market and avoid policy surprises on the state and federal level, ranging from issue management to active engagement such as RFIs. Contact us today to see how your company or organization can get started.

The Importance of White Papers in the Life Sciences and Pharmacy Industries

More and more, white papers are being utilized by the life sciences and pharmacy industries to inspire governmental, agency, and even judicial action. White papers serve as an authoritative instrument that informs readers and helps to conceptualize a complicated issue in a more efficient manner, often including explanatory infographics. If done correctly, entities can use white papers to help state and federal policymakers understand the complexities of the supply chain, or other critical life sciences issues of national important, that influences the movements of prescription drug pricing.

In response to the increased scrutiny of the rapidly rising costs of prescription medications, the United States Senate Committee on Finance’s Minority Staff recently released report titled “A Tangled Web: An Examination of the Drug Supply and Payment Chains.” This in-depth report identifies stakeholders in the supply chain as well as their role in prescription drug pricing.

In the report, the Senate Committee cites the “Performance Based DIR Fees: A Rigged System With Disparate Effect on Specialty Pharmacies, Medicare Part D Beneficiaries and the U.S. Healthcare System (2017)” white paper authored by Frier Levitt, LLC, on behalf of the National Association of Specialty Pharmacy (NASP). The Committee cited the white paper’s description of direct and indirect remuneration (DIR) fees and limited distribution drugs, both issues impacting the supply chain and influencing prescription pricing. These types of governmental reports are important precursors and predictive of future legislative and regulatory policy and serve as an example of a white paper commissioned by a national coalition to advance the interests of its constituent members.

Frier Levitt, LLC, and Frier Levitt Government Affairs, LLC, are composed of healthcare and life sciences attorneys with extensive knowledge of how policy, law, and markets intersect, helping associations, coalitions, and other types of organizations convey complicated problems into an easy to understand format. Contact Frier Levitt Government Affairs today to find out how white papers can work for you.

Medicaid 2019: Potential Changes You Need to Prepare for Now

States are pursuing new policy avenues. Managed care is evolving. And providers need to help clients find access to a system with ever-shrinking resources.

This webinar will examine the various ways states are addressing their Medicaid challenges…and how those changes could impact you.

In this recorded webinar, Ronald W. Lanton III, Esq., Executive Director & Senior Counsel at Frier Levitt Government Affairs gives an insider’s take on potential changes coming to Medicaid. He works with clients throughout the Care Continuum, helping them navigate both government and market issues, including:

  • Greater state scrutiny of managed care and reimbursement
  • State responses to the opioid crisis and their effect on providers
  • Increased demand for behavioral health and how to pay for it
  • Congressional policy and what to expect after the mid-terms

If you need assistance with government/market issues or reviewing how 2019’s potential Medicaid changes will impact your business, contact Frier Levitt Government Affairs.

This webinar is presented through a partnership with Mediware.

Arkansas PBM Law Ruled Preempted By ERISA

In 2015, Arkansas enacted Arkansas Act 900, titled “An Act to Amend the Laws Regarding Maximum Allowable Costs Lists, To Create Accountability in the Establishment of Prescription Drug Pricing; And for Other Purposes.” Arkansas Act 900 requires Pharmacy Benefit Managers (PBMs) to make adjustments to pharmacy reimbursement when it comes to Maximum Allowable Cost (MAC) pricing changes. The law is one of over 30 MAC laws enacted by states on this issue regarding a MAC appeals process or the process for how MAC reimbursement should be adjusted when there are changes to multisource generic pricing. MAC appeal laws are designed to ensure that PBMs are fairly paying pharmacies and to avoid unreasonable reimbursement to pharmacies.

While MAC statutes are steadily being enacted across the country, the PBM lobby, Pharmaceutical Care Management Association (PCMA), a national association representing PBM interests, has zeroed in to challenge how MAC statutes were drafted in only two states—Iowa and Arkansas. Since no uniform model legislation on MAC laws has been developed, each state has been left to its own device, as well as its own resources and pharmacy advocacy make-up, to determine the wording of such legislation. While the laws received much support, federal courts unfortunately ruled that both Arkansas and Iowa were too aggressive in how their laws were constructed. Fortunately, attentive drafting of MAC appeal laws that carefully navigates related laws, can avoid PCMA’s successful challenge to state MAC laws.

A federal judge in Arkansas recently ruled against Arkansas Act 900. PCMA used a variety of constitutional arguments against further implementation, including preemption, violations of the commerce clause, due process, and the contracts clauses of the state and federal constitutions. Pharmacy organizations must learn from the shortcomings of the Arkansas Act 900 exploited by PCMA.

Ultimately, it was the Employee Retirement Income Security Act of 1974 (ERISA) statute that doomed Arkansas Act 900. The court ruled that the law interfered with national uniform plan administration by regulating the conduct of PBMs administering or managing pharmacy benefits pertaining to ERISA plans.

Additionally, the court ruled that Medicare also preempted the law since with respect to the Negotiated Price Standard, because:

  • After an appeal, the resulting price could by the MAC Price, the Invoice Price, or the best price from the wholesaler higher than the MAC price
  • The “decline to dispense” provision violated the requirements of the Pharmacy Access Standard, which requires that a certain percentage of beneficiaries live within a certain distance to a network pharmacy

The good news is that vulnerabilities to state MAC laws are avoidable.

Frier Levitt Government Affairs, LLC, works with organizations in different states on bills regarding healthcare and life sciences issues, including issues with PBMs. Having a bill drafted correctly, taking into account the current political and business climate, is essential to avoiding delays and litigation, which could result in wasting political capital. The Frier Levitt Government Affairs bill check process confidentially examines an organization’s proposed language, verifying the correct statute, while having it reviewed by our numerous clinician attorneys. Contact us today for assistance with your organization’s bill.

CMS Releases 2019 Medicare Part D Final Rule Addressing Important Issues for Pharmacies

On April 2, 2018, the Centers for Medicare and Medicaid Services (CMS) released the 2019 Medicare Part D Final Rule. The Final Rule addresses several Medicare Part D issues of importance to the community pharmacy industry, including:

  • Direct and Indirect Remuneration (DIR)
  • Standard terms and conditions
  • Accreditation
  • Comprehensive Addiction and Recovery Act (CARA) Implementation
  • Any Willing Provider
  • Part D Formulary Changes
  • Part D Tiering Exceptions
  • Mail Order Definitions
  • The interpretation of retail pharmacy networks

The Medicare Part D Final Rule presents many legal and policy options that can be used to argue against several issues that pharmacies confront with Pharmacy Benefit Managers (PBMs) and plan sponsors, including network participation, credentialing, and reimbursement changes based on dispensing history. Contact Frier Levitt Government Affairs today for help with the Final Rule.