Summary
Regulatory Update
The Office of Management and Budget (OMB) has completed its review of two major Medicare payment update rules for calendar year 2023 – the Medicare Physician Fee Schedule and the Hospital Outpatient Prospective Payment System. The Centers for Medicare & Medicaid Services (CMS) could release those rules as early as this afternoon, though the timing is not certain. However, CMS has been known to deliver tricks and treats in the past, with the release of major payment rules on Halloween (most recently in 2019)
In addition, CMS announced late last Friday that it is delaying the timeline for publication of its final rule regarding Medicare Advantage risk adjustment for another three months until February 1, 2023. The rule was originally proposed in 2018 (WHG summary here) and would revise the MA Risk Adjustment Data Validation (RADV) regulations in order to better recoup overpayments to MA plans. CMS previously extended the publication timeline for an additional year in October 2021. The agency cites “ongoing exceptional circumstances” as the cause for this most recent decision to delay the rule’s publication.
Unwinding the Public Health Emergency
Health and Human Services Secretary Xavier Becerra recently renewed the public health emergency (PHE) another 90 days through January 11, 2023. If the Biden Administration does not give states 60 days advance notice by November 14, 2022, then we could expect the PHE to be extended again in January until April 11, 2023. However, if the PHE is not renewed, then states could begin to disenroll Medicaid beneficiaries who no longer meet coverage requirements as soon as February 1, 2023.
At last week’s MACPAC session on unwinding the PHE, Commissioners asserted the importance of monitoring states’ progress towards unwinding the continuous coverage provision given administrative and operational complexity and the potential for inappropriate loss of coverage for Medicaid beneficiaries. The session focused on the different CMS, federal, and state monitoring requirements, but noted that it is unclear what data on conducting eligibility redeterminations will be made public. Several Commissioners expressed concern with the lack of commitment by CMS and states to release data and called for increased data transparency.
WHG Roundup: Looking Ahead on Medicare
This week, CMS Administrator Brooks-LaSure will hold a National Stakeholder Call to provide an update on recent accomplishments and progress on the agency’s Strategic Plan (WHG summary). With Democratics expecting a more difficult legislative environment after the upcoming midterm elections, the Administration’s focus will likely shift towards agency action. The Administrator’s call could provide some additional insight into what CMS has planned over the coming months.
Implementation of the Inflation Reduction Act
The implementation of the Inflation Reduction Act features several drug pricing reforms that are intended to improve the affordability of prescription drugs for Medicare beneficiaries. CMS recently released an implementation timeline that starts with October 1, 2022 provisions and goes through 2029. Below we highlight recent implementations actions. All other implementation dates occur in 2023 and beyond.
- Establishment of the Medicare Drug Rebate and Negotiations Group – The Department of Health and Human Services (HHS) recently announced the establishment of the Medicare Drug Rebate and Negotiations Group within the Center for Medicare to implement the drug price negotiations program and the inflation rebate program. Additional details and responsibilities of the Group can be found here.
- Medicare Part D Drug Rebates – October 1 marks the start of the first 12-month period for which drug manufacturers will be required to pay rebates to Medicare if the price for Part D drugs exceeds the rate of inflation. Rebates for the first two 12-month rebate periods will be invoiced to manufacturers by December 31, 2025.
- Temporary Payment Increase Biosimilars – A provision that provides a temporary payment increase for biosimilars whose list price does not exceed the reference biologic list price went into effect October 1. Qualifying biosimilars will be reimbursed at the average sales prices (ASP) of the reference biologic plus 8 percent, compared to the typical 6 percent, for a period of five years.
MedPAC
The Medicare Payment Advisory Commission (MedPAC) will hold its third meeting of the 2022-2023 cycle this Thursday and Friday. Commissioners will examine differences in quality measures across race/ethnicity categories and income level and provide direction for future work. Commissioners will also review and discuss policy options for increasing Medicare payments to primary care clinicians as well as the alignment of fee-for-service payment rates across ambulatory settings.
Additionally, the Commission will continue its discussion on the following topics:
- Prototype prospective payment system (PPS) for all post-acute care (PAC) providers (report due June 30, 2023) (WHG summary);
- Options to better support safety-net clinicians (WHG summary); and
- Standardizing benefits in Medicare Advantage plans (WHG summary).