Health Policy Report (7/20)

July 20, 2020

Capitol Hill Update

House and Senate lawmakers will return to action this week to begin a two-week legislative blitz to close out the month of July before leaving for the August district work period. Negotiations on the next COVID-19 relief package are expected to begin in earnest once Members return, as it is widely expected that Senate Republicans will introduce an opening offer proposal later in the week. Majority Leader Mitch McConnell’s (R-KY) forthcoming proposal is expected to focus on health care, jobs, reopening schools and universities, and liability protections. While lawmakers on both sides of the aisle have expressed a willingness to get something done on the next relief package, it remains to be seen whether the parties can clinch a bipartisan agreement given the deep policy divides over the size and scope of the next COVID-19 bill.

In a draft summary of the liability section obtained by TRP, the Senate GOP’s proposal would insulate health care, education, government, and business entities from lawsuits retroactive to December 2019 through 2024 unless there is proof of “gross negligence and intentional misconduct.” For personal liability and medical cases, the plan would require a “clear-and-convincing-evidence burden of proof,” would place a cap threshold on damages, and would heighten pleading standards. It would also limit liability for new products, such as types of PPE, if they meet established Food and Drug Administration (FDA) standards. While these policies are subject to future negotiation and change, Leader McConnell has continuously emphasized that any future COVID-19 relief efforts must include these protections in order for the Senate to consider additional relief legislation.

On the floor, each chamber will pick up consideration of their respective versions of the National Defense Authorization Act (NDAA) to kick off this two-week stretch of legislative activity. Both chambers are expected to pass the annual defense spending bill prior to the end of the week, and will move onto a Conference Committee to iron out a final deal, where they will need to resolve several key differences related to changing the name of military bases named after Confederate leaders, the transfer of excess military equipment to law enforcement agencies, and limiting Executive Branch war power authority, among other things. In addition to the NDAA, House lawmakers will take up the chamber’s first “minibus” package for fiscal year (FY) 2021 — which includes Agriculture-FDA, State-Foreign Operations, Military Construction-VA, and Interior-Environment spending bills.

White House Changes Hospital COVID Reporting System to Bypass CDC

Last week, the administration altered hospital COVID-19 reporting rules to require that data go directly to the Department of Health and Human Services (HHS), rather than continue to report to both HHS and the Centers for Disease Control (CDC). HHS noted the change in reporting would allow the administration to better allocate supplies and drugs, but stakeholders immediately declared it was further evidence that the CDC was being sidelined in response efforts. CDC Director Dr. Robert Redfield explained later that the “data ecosystem” has not changes and that the agency and state and local health departments will still have access to HHS-collected information, clarifying that the administration “merely streamlined data collection mechanisms for hospitals on the front lines.” Furthermore, HHS Secretary Alex Azar and White House Coronavirus Task Force Response Coordinator Deborah Birx reportedly sent a letter asking state governors to consider sending the National Guard to hospitals to help improve data collection, arguing that the changes were warranted due to some hospitals failing to report complete or daily information. The data reported by hospitals, which is used by the White House Coronavirus Task Force, includes the number of hospitalized patients with suspected or confirmed COVID-19, available beds and ventilators, and COVID-19 patient deaths, among other information.

It was initially reported that the new database will not be open to the public, although HHS Chief Information Officer Jose Arrieta explained later that the department is “exploring” the best way to make data from the database available to the public. Stakeholders expressed concern that the change will make it harder for public health researchers and agencies to track the pandemic. Additionally, hospitals have complained that they now have to make changes to their reporting systems in the midst of the pandemic, with little notice off the change beforehand, although the American Hospital Association issued a special bulletin urging members to “report the data to HHS as requested.” The administration countered that the streamlined reporting requirements make sense, as HHS’s system was specifically designed for COVID-19 and the CDC’s system was created to collect information on hospital-acquired pneumonia and urinary track infections. 

SAMHSA Finalizes Changes to Part 2 Privacy Rules

The Trump administration last Monday finalized a much-anticipated rule updating the consent requirements governing the release of patient information for individuals seeking treatment for substance use disorder (final rulefact sheet). The rule, developed by the Substance Abuse and Mental Health Services Administration (SAMHSA), is designed to address barriers to care coordination for providers that treat individuals with substance use disorder (SUD), while maintaining privacy safeguards for patients seeking treatment for SUD. Health and Human Services (HHS) Secretary Alex Azar stated that, thanks to the “valuable” input of stakeholders, the final rule will “make it easier for Americans to seek and receive treatment while lifting burdens on providers and maintaining important privacy protections.” HHS Deputy Secretary Eric Hargan added that the changes — part of the Regulatory Sprint to Coordinated Care — are “just the beginning of a comprehensive agenda for reforming regulations that govern the delivery and financing of American healthcare, with the ultimate goal of better care, and better health, at a lower cost.” 

HHS noted that the basic framework for confidentiality protection of SUD patient records is not altered under the rule, and the U.S. Code will continue to prohibit law enforcement’s use of SUD patient records in criminal prosecution and restrict the disclosure of SUD treatment records without patient consent. The final rule from SAMHSA modifies several sections of the substance use privacy law to encourage care coordination among providers. The rule updates the definition of what constitutes a Part 2 record and its applicability in order to ensure that providers have additional clarity about what is, or should be, protected by Part 2. It also seeks to ensure that Part 2 providers are not discouraged from caring for patients with SUD or recording their information. SAMHSA clarifies that personal devices not involved in Part 2 program business do not have to be “sanitized” — i.e. record deletion — if a SUD patient accidentally messages a provider’s personal device. Additionally, non-Part 2 providers will have access to central registries to determine if a patient is enrolled in an Opioid Treatment Program (OTP) and receiving medications as part of SUD treatment to ensure at-risk patients are not accidently overprescribed or prescribed substances for which they are seeking treatment.

 The administration had previously noted they have limited ability to ease the sharing of substance use records without congressional authorization, and the CARES Act (H.R. 746) ordered HHS to make the sharing of substance use records more similar to the handling of other medical records governed under HIPAA. SAMHSA announced last week that it will issue a separate proposed rulemaking to comply with the policies included in CARES, although the legislation stated the Part 2 provisions cannot take effect before March 27, 2021. Under CARES, patients can allow their substance use records to be shared within the health system, and to no specific entities, and have the option to revoke consent. The law also upholds existing restrictions on sharing substance use records for law enforcement investigations and civil trials.

CMS Shows High Telehealth Utilization, Previews Plans to Maintain Flexibilities

Last Thursday, Centers for Medicare and Medicaid Services (CMS) Administrator Seema Verma published an article in the Health Affairs blog discussing the effect of new telehealth flexibilities on patient access. She reported orders of magnitude increases in Medicare telehealth utilization and that beneficiaries in both urban and rural areas were seeing care via telehealth at high rates. Beneficiaries of all ages and races and ethnicities have taken advantage of telehealth care availability during the pandemic. Administrator Verma also laid out considerations for how CMS might extend telehealth flexibilities after the pandemic.

Administrator Verma wrote that in the last week of April, nearly 1.7 million Medicare beneficiaries received telehealth services. Prior to the pandemic, approximately 13,000 Medicare beneficiaries received telehealth services in a week, she said, and furthermore:

  • Nine million beneficiaries have received telehealth services since the beginning of the pandemic, spread somewhat evenly across demographics.
  • 22 percent of rural beneficiaries have accessed telehealth services since the pandemic began, while 30 percent of urban beneficiaries have.
  • 25-34 percent of beneficiaries across all age groups have received telehealth services, and there were no significant differences in utilization across racial and ethnic groups.
  • In addition, dually eligible beneficiaries were found to have a higher-than-average rate of telehealth use, with 34 percent of dually eligible beneficiaries using telehealth since the pandemic began.

Behavioral health care is an area that shows particular promise as a telehealth service, Administrator Verma wrote. She notes that some beneficiaries may have felt stigma seeking behavioral health care outside the home but have been able to access it delivered remotely. Administrator Verma also wrote that roughly 30 percent of telehealth visits delivered during the pandemic have been audio-only.

While she wrote that “telehealth will never replace the gold-standard, in-person care,” Administrator Verma said that it provides an important additional way to access care. Given the experience of telehealth expansion during the pandemic, CMS is reviewing which changes should be made permanent through regulation. However, it is important to note that some flexibilities — such as the ability of non-rural beneficiaries to access telehealth services — will require Congressional intervention to maintain post-pandemic. As CMS evaluates the experiences and options, Administrator Verma wrote, the agency will focus on (1) assessing whether telehealth service is appropriate and safe for patients compared to an in-person visit; (2) assessing Medicare payment rates for telehealth services going forward; and (3) ensuring program integrity. Regarding payment rates, outside the pandemic, by law Medicare usually pays for telehealth services at rates similar to what professionals are paid in the hospital setting for similar services. Notably, the Administrator wrote that further analysis could be done to determine the level of resources involved in telehealth visits outside of a public health emergency, and to inform the extent to which payment rate adjustments might need to be made.

IG Finds Verma Violated Federal Contracting Rules

The Department of Health and Human Services’ Inspector General (OIG) released a report last Thursday stating Centers for Medicare and Medicaid Services (CMS) Administrator Seema Verma mismanaged more than $6 million in strategic communications contracts. The federal watchdog reported that Administrator Verma and other senior officials violated federal contracting rules to bring in Republican communications experts to support the agency’s public relations and outreach efforts. CMS reportedly gave Marcus Barlow, of Nahigian Strategies, far-reaching authority over agency employees, allowing the communications experts to “perform inherently government functions.” The OIG compared the Verma ally’s power within the agency to a “CMS senior leader,” as the individual often accompanied the Administrator to meetings, directed agency employees, and told CMS staff he was one of three people allowed to approve tweets. Additionally, the OIG report notes that CMS used incorrect contracting processes to secure consulting services, and sidestepped “civil service laws that require hiring federal employees under competitive appointment or other allowable procedures.” Mr. Barlow previously served as a spokesperson for Administrator Verma when she consulted Indiana about their Medicaid program.

Administrator Verma previously defended her contracts, arguing that CMS required outside expertise to supplement busy agency staff, although OIG countered that the CMS Office of Communication could have filled up to 15 vacant positions instead of the consultants. HHS spokesperson Michael Caputo argued that the report is proof of the media and Congress looking to “make a mountain out of a molehill,” and stated the report was based on “arcane contracting rules that remain the subject of longstanding confusion and debate across the entire federal government.” More than a dozen Democratic leaders in the House and Senate have called for Administrator Verma’s removal since initial concerns over the contract violations emerged. House Energy and Commerce Chairman Frank Pallone, Jr. (D-NJ), House Oversight and Reform Chairwoman Carolyn B. Maloney (D-NY), Senate Health, Education, Labor, and Pensions (HELP) Ranking Member Patty Murray (D-WA), and Senate Finance Ranking Member Ron Wyden (D-OR) released a joint statement last Thursday stating the Administrator may not be fit to run the agency.