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We summarize CMS’ draft call letter for calendar year 2019.

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Feb. 2, 2018


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We’d Say Better Late Than Never, But…Advance Notice and Draft Call Letter Released


Late Thursday afternoon, the Centers for Medicare & Medicaid Services (CMS) released the advance notice and call letter for calendar year (CY) 2019. Technically, this second part of the advance notice was to be released on January 31; there is speculation that the new head of the Department of Health and Human Services (HHS), Alex Azar, held it back to take a peek. Comments are due by March 5; the final notice and call letter will be available in April. What follows is a summary of our initial scan of the release.

Medicare Advantage (MA) payments are expected to have an effective growth rate of 4.35% on average for 2019, which ultimately will translate to a revenue increase of about 1.84%. CMS is also proposing a reinterpretation of what is allowed as a supplemental benefit under the MA program; CMS would allow services that might be considered “daily maintenance” if they “compensate for physical impairments, diminish the impact of injuries or health conditions, and/or reduce avoidable emergency room utilization.” For example, this might include a portable wheelchair ramp.

On the Medicare prescription drug benefit side, CMS is emphasizing tools to address overuse of opioids, building on efforts by the agency to address the issue. There are also some changes to Star Ratings, such as the new measures Statin Use in Persons With Diabetes (Part D) and Statin Therapy for Patients With Cardiovascular Disease (Part C), but these had all been previously announced. The Benefit Parameters are making the usual minor adjustments, and the specialty tier is staying at $670.

Given that the proposed rule was released this fall, a little quiet is to be expected. But, with a new sheriff in town, we’ll see where this all goes.


Xcenda Issue Brief: 2018 Healthcare Outlook—Leaning Into the Chaos


What’s next in the healthcare environment for 2018?

While 2017 started with the sense of radical possibility, it quickly dissolved into steady-state chaos. This year, we’re keen on watching several key trends as we learn to embrace and anticipate what’s next in the healthcare environment and make the most of it.

Download our latest issue brief to learn more about what healthcare trends we’re keeping an eye on. Learn more




Compounding Problems, Not Just the Math Classes You Don’t Remember


On Tuesday, the House Energy & Commerce Committee held a hearing, Examining Implementation of the Compounding Quality Act, to examine the implementation of the Compounding Quality Act (CQA), which is Title I of the Drug Quality and Security Act (DQSA). The DQSA was enacted almost 5 years ago after the fungal meningitis outbreak caused by the New England Compounding Center in 2012.

Food and Drug Administration (FDA) Commissioner Scott Gottlieb (statement), Jenn Adams, Senior Vice President & President of Clinical Product Solutions for AmerisourceBergen (statement), and 7 other witnesses testified at the hearing.

The CQA created a new category of compounders called outsourcing facilities or 503B. Stakeholders, however, have claimed the guidances the FDA developed to implement the CQA are confusing and lack clarity. Consequently, there is concern that some compounders are using the lack of FDA clarity and enforcement to compound much cheaper bulk powders, while others adhere to the gold standard of 503B, compounding only using FDA-approved drugs.

New guidance is expected in March clarifying that bulk drug substances may be used for compounding only when there is clinical need to compound drugs using these substances. Health Policy Weekly will be tracking this important issue that will further enhance patient safety.


Let’s Ask the New Kid: Azar Questioned About 340B Oversight


Last Friday, Sen. Orrin Hatch (R-UT) sent a letter to newly confirmed HHS Secretary Alex Azar about the 340B Drug Pricing Program and the capabilities of the Health Resources and Services Administration (HRSA) to oversee it. The letter reviews the goals and growth of the program, projected to be responsible for over $20 billion in drug sales by 2021.

Hatch’s raising the issue of CMS to oversee the 340B program is woven through 6 questions he asked Azar to answer by February 26. The questions ask Azar to opine whether HRSA can manage the increasing needs of the 340B program and whether the greater resources of CMS, coupled with its experience interacting with all stakeholders of the healthcare industry, warrant it having oversight responsibility.

While there are likely many opportunities for efficiencies to be found with CMS overseeing the 340B program, questions arise whether the outstanding concerns stakeholders have raised about the 340B program would be better addressed under CMS.


‘Gowdy There, Partner, Let Me Ask You a Few Questions’


Rep. Trey Gowdy (R-SC) is joining Sen. Hatch in keeping new HHS Secretary Alex Azar busy on the job. Gowdy, the House Oversight and Government Reform Committee Chair, sent a scathing letter to Azar, giving HHS 1 week to respond to the committee’s requests for data on:

  • Disaster preparedness in Puerto Rico and the Virgin Islands
  • Information on cost-sharing reduction payments from implementation of the Affordable Care Act (ACA)
  • The US opioid epidemic
  • The Medicare Part D program
  • Key policy issues around health privacy and security

Gowdy’s letter stated that HHS had a “posture of nonchalance” that began back in October 2016 when the committee made its first set of special requests to the department.

If HHS does not comply by February 5 or provide a compelling, legal reason for why the documents are being withheld, Gowdy has threatened to subpoena the department for withholding the information previously requested. He stated that deadlines have been repeatedly missed, incomplete and “meager” data have been provided, and HHS has had a “pattern of nonresponsiveness and wanton disregard for the committee’s requests” that Gowdy believes undermine its mandate of providing oversight.

The Oversight Committee’s ranking Democrat, Elijah Cummings (D-MD), has also asked Gowdy to subpoena HHS regarding reports about the agency’s use of nondisclosure agreements.

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Amazon + JP Morgan + Buffet: Maybe Something Bad, Maybe Something Good


Earlier this week, Amazon, Warren Buffett (Berkshire Hathaway), and JPMorgan Chase announced they are going to create an independent company to provide healthcare for their employees. Together, these 3 companies have about a million employees. This new venture is said to be “free from profit-making incentives and constraints” and aims to focus on technology that will aid in “simplified, high-quality, and transparent” care.

Details were sparse, but the reverberations of this announcement were felt throughout the business community (and the stock market). Planning is clearly in the early stages for this new venture, and it raises a lot of questions about potential implications beyond their employee base. There is speculation that they will self-fund their insurance pools and use technology to be able to offer more cost-effective healthcare.

With this many employees, and many of them concentrated in certain markets (Seattle, Omaha, New York, etc), there is potential to test new payment and delivery models. But it is unclear if this means Amazon for health insurance, or if it means they are going to start buying health systems, or something entirely different.

Yet, the idea of a disruptor has captured the interest of the healthcare industry, and everyone will be watching for next steps, including your Health Policy Weekly team.


Simple Steps to Becoming a High-Performing ACO!


Six key factors distinguish high- from low-performing accountable care organizations (ACOs), according to a recent study in Health Services Research. The study examined a sample of 16 ACOs to identify factors that promote their effective performance in the Shared Savings Program (SSP).

To enhance health outcomes, the ACA established the SSP and created ACOs to manage assigned groups of fee-for-service (FFS) Medicare populations. ACOs are rewarded for providing quality care and appropriate management to their populations. Alternatively, if beneficiaries demonstrate poor health outcomes, the organization may be penalized and required to repay losses that Medicare sustains due to poor management or low quality of care.

The study identified 6 factors that promote the effective performance of these ACOs:

An unexpected insight from the study may help to explain why less than one-third of SSP ACOs earned bonuses for cost savings in the first 3 years of the program. The authors noted that high-performing ACOs consisted of well-established physician groups with a history of providing cost-effective patient care prior to their involvement in an ACO. The authors interpret this observation to imply that ACOs whose participants have not worked together, or that had not built effective care management systems before ACO formation, may take years to reach their potential.

The SSP began with great fanfare but, so far, has not yielded the cost savings and quality improvements advocates had hoped. Perhaps these study findings can guide ACOs toward success.


Information Buffet (AKA, Other Stuff That Caught Our Attention)


We kept running into stories we wanted to bring to your attention, so here’s a quick hit list of other news we thought you should know:


Xcenda Collaborates With Family Reach on Critical Issue: Cancer-Related Financial Toxicity

Our in-depth white paper shines a spotlight on a national crisis impacting cancer patients and their families.

Xcenda consultants lent their scientific research, medical writing, and design expertise to collaborate on a white paper spearheaded by Family Reach, titled Cancer-Related Financial Toxicity and Its Pervasive Effects on Patients and Families: Solving a National Health and Economic Crisis Hiding in Plain Sight. Learn more




“One of my greatest priorities is to reduce the price of prescription drugs. In many other countries, these drugs cost far less than what we pay in the United States. That is why I have directed my Administration to make fixing the injustice of high drug prices one of our top priorities. Prices will come down.


– President Donald Trump, “State of the Union Address,” January 30


21 Million


Almost 21 million people are enrolled in Medicare Advantage plans, up 7.7% from last year.

Source: “Medicare Advantage enrollment booms,” Axios, January 30


CBI 10th HUB and SPP Model Optimization Conference

February 27–28 l Philadelphia, PA
Join AmerisourceBergen sister company Lash Group at CBI’s 10th Annual HUB and SPP Model Optimization Conference in Philadelphia. Mark Sypkerman, Senior Vice President of Premier Source at Lash Group, will present a session titled, “Implement New Technology Innovations to Improve Speed, Scale, and Patient and Provider Experience for Electronic Benefit Verification and Prior Authorization.” Learn more


CBI 19th Patient Assistance and Access Programs Conference

March 6–7 l Baltimore, MD
Join leaders from Xcenda and Lash Group at the 19th PAP Conference in Baltimore. Ana Stojanovska, Vice President, Reimbursement & Policy Insights, and Teri’ Burnell, PharmD, Senior Vice President, Field Support at Xcenda, will host the Opening Luminary Address on “The Changing Landscape of Healthcare Coverage and Access.” Tommy Bramley, PhD, President of Lash Group, will present the Keynote Address on “Pioneering to New Grounds in Patient Access—Rewriting the Playbook for Patient Programs.” Learn more


AMCP Managed Care & Specialty Pharmacy Annual Meeting

April 23–26 l Boston, MA
Join AmerisourceBergen companies, US Bioservices and Xcenda, at AMCP’s Annual Meeting at the Boston Convention and Exhibition Center April 23–26. Meet with our specialty pharmacy and commercialization experts at the largest gathering of managed care professionals who work, lead, and innovate in the ever-changing world of pharmaceutical management. Visit AmerisourceBergen at booths 316 and 321. Learn more


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Count on Health Policy Weekly for an at-a-glance view of legislative and regulatory developments and news that impacts the healthcare industry.


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Jennifer Snow
Senior Director,
Health Policy

Scott Shields
Associate Director,
Health Policy



Peyton Howell, MHA
Executive Vice President & President, Health Systems & Specialty Care Solutions | AmerisourceBergen Corporation

Amy Grogg, PharmD
Senior Vice President | Strategy & Commercialization | AmerisourceBergen Corporation

Kristine Flemister, PharmD
President | Xcenda

Tommy Bramley, PhD, RPh
President | Lash Group

Stacie Heller
Vice President | Government Policy | AmerisourceBergen Corporation

Rita Norton
Senior Vice President | Government and Public Policy | AmerisourceBergen Corporation

Ana Stojanovska
Vice President | Reimbursement & Policy Insights | Xcenda


Amanda ForysAndrew Gaiser | Scott Shields | Diane Smith | Jennifer Snow


Laurie Kozbelt | Ellen Olson | Tia O’Brien

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Feb. 2, 2018


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