Legislative Weekly

3/04/24

1. No Surprises Act (NSA) and Transparency Rules (TinC)
2. DC and Federal Update
3. State Activity
4. The Industry

HIGHLIGHTS: Transparency likely not to be addressed by Congress until end of year; Study says MA rates lower than expected; DOJ busy with antitrust and fraud concerns; CO board votes to consider nation’s first state price cap on drug.

No Surprises Act (NSA) and Transparency Rules (TinC)?

New healthcare price transparency requirements are unlikely to be a part of the appropriations bills that are due to be passed by March 8 and March 22. (Last night — Thursday — Congress gave itself some extra time to avoid a government shutdown.)? According to The Hill, talks have broken down on a broad healthcare package that would have included transparency, a crackdown on PMB rebates, and billing for off-campus hospital clinics.

• The next time Congress is likely to take up healthcare provisions such as the transparency package will be at the end of 2024 for inclusion in a larger omnibus bill.
• The appropriations legislation this month is still expected to attempt to somewhat mitigate Medicare’s 3.4% physician reimbursement cut that went into effect on Jan 1.

DC and Federal Update

According to a study funded by the Better Medicare Alliance, proposed 2025 MA rates could have a steeper impact on health plan reimbursement than the government expects. While CMS suggests that their plan for MA rates would only lead to a rate decrease of 0.16%, the study predicts a larger 1.0% decrease.

• Study authors warned that “when government reimbursement drops, MA beneficiary benefits also tend to be reduced.”

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The DOJ reported that 543 settlements and judgments under the False Claims Act reached ~$2.7 billion in fiscal year 2023-the highest in history.?

• The majority came from the healthcare industry, with Medicare Advantage being the top enforcement priority during the year, along with fraud from pandemic relief programs and violations of cybersecurity requirements in government contracts.

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The DOJ is also prioritizing private equity’s role in healthcare fraud by focusing on ways in which it can “influence medical provider behavior” and “undermine medical judgment” to falsely prioritize reimbursement.

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The DOJ is reportedly investigating UnitedHealth over antitrust concerns and billing practices in order to examine the company’s role in healthcare competition.

• The DOJ is fact gathering and has not alleged any wrongdoing by UnitedHealth.
• At the same time, UnitedHealth has been dealing with the fallout of a weeklong cyberattack on its networks associated with Change Healthcare, of which it is the parent company. Change’s system outages have disrupted operations in pharmacies and health systems nationwide, but as of earlier this week, reports suggest that over 90% of the nation’s impacted pharmacies have set up electronic workarounds.

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The HHS group tasked with coordinating cybersecurity efforts unveiled its latest strategic plan to deal with growing cybersecurity threats in the healthcare sector.

• The five-year plan outlines several goals, including “feasible” cybersecurity requirements in the sector, plus “911 cyber civil defense” capabilities to ensure early warnings.

The States

Colorado state regulators have settled with U.S. Anesthesia Partners, one of the largest practices in the country, over allegations that the private-equity backed practice engaged in anti-competitive practices.

• USAP will give up exclusive contracts at 5 CO hospitals and will revise the noncompete language in provider employment contracts, but denies any unlawful actions.
• Relatedly, North Carolina cities and counties sued HCA Healthcare and the company it acquired, Mission Health, over alleged antitrust behavior in 2022.? This week, a federal judge denied HCA’s motion to dismiss the suit. At issue are HCA’s contracting provisions that allegedly include all-or-nothing, anti-steering, and anti-tiering provisions as well as gag clauses.

Colorado state’s Prescription Drug Affordability Board voted to pursue placing an upper payment limit on a drug used to treat arthritis after determining it is not affordable for patients — the first such vote in the nation.

• The pharmaceutical industry is in full opposition to a state setting upper payment limits for drugs, stating that the Board ignored a letter from The Arthritis Foundation that claimed such a limit wouldn’t necessarily make the drug more affordable.
• State statute and regulations do not address what course of action to take if a drug manufacturer refuses to sell at a price set by the Board.
• Other states have begun the process of setting up and running similar boards: 11 total, while Maryland, Minnesota, Oregon and Washington are closest to CO’s progress level.

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A bipartisan group of 39 state AGs sent a letter to Congress this week asking lawmakers to bring more transparency to pharmacy benefit managers’ practices.

• The letter was primarily authored by the AGs of Arkansas, North Carolina, Ohio, and Pennsylvania and highlights three specific bills that are crucial to necessary reforms.

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The Industry

Walgreens has announced it will now begin accepting Medicare Advantage supplemental benefits online in an effort to increase healthcare access and improve user experience.

• While the store has accepted these benefits in-store since 2019, the move to online is expected to assist those with mobility issues, are homebound, or otherwise cannot make it to a store.?

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An article in HealthTechZone evaluates some of the recent innovations in oral healthcare. Notably, digital dentistry is among the technological trends reshaping the industry, along with AI and devices such as smart toothbrushes. Another innovation on the horizon –??? regenerative dentistry – could include techniques to regenerate dentin and enamel for improved oral health.

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Zelis’ Amanda Eisel examines what’s behind healthcare’s lagging digitization in the payments space in this Forbes article.

This update is solely for informational purposes and should not be relied upon as legal advice.