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Congress has until Friday night to pass a new spending bill to avoid a shutdown.

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Jan. 19, 2018

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FEATURED STORY
 

Shutdown or No Shutdown, That Is the Question

 
 

Last night, by a vote of 230-197, the House of Representatives passed a GOP-backed short-term spending bill that would fund the government through February 16. Almost immediately after, the Senate voted to begin debate on the bill. This marks the fourth short-term spending bill Congress has debated since September.

Both chambers of Congress have until Friday night to pass a new spending bill, but Democrats and Republicans remain at an impasse over the path forward, increasing the chances of the first government shutdown since 2013. If lawmakers don’t extend funding by Friday night, the government will shut down early Saturday.

The continuing resolution (CR) includes a 6-year reauthorization of the Children’s Health Insurance Program (CHIP) and delays on 3 Affordable Care Act (ACA) taxes:

  • Medical Device Excise Tax
  • Excise Tax on High-Cost Employer-Sponsored Health Coverage
  • Annual Fee on Health Insurance Providers

Democrats remain largely opposed to the CR because they want it linked to a larger immigration deal over the Deferred Action for Childhood Arrivals (DACA) program and border security.

The Senate does not currently have 60 votes to break a filibuster of the House bill, though Republicans are hoping the inclusion of CHIP funding will be enough to sway a critical mass of Democrats to vote for the bill.

 

Building a Biosimilars Market: Lessons From the US Launches

 
 
Scrip Pharma Intelligence

How has the US market responded to biosimilars? AmerisourceBergen experts Rick Lozano, Rich Tremonte, and Amanda Forys share key takeaways from our involvement in launching all 3 of the currently marketed biosimilars in the US. Learn more

 

 

 
LEGISLATIVE UPDATES
 

PIE Anyone? Pre-Approval Information Exchange Bill Moves Ahead

 
 

This week, the Energy and Commerce Subcommittee on Health voted and approved HR 2026—The Pharmaceutical Information Exchange (PIE) Act of 2017. The bill now goes to the Energy and Commerce Committee for consideration.

PIE was introduced last April by Rep. Brett Guthrie (R-KY) and incorporates the multi-stakeholder consensus recommendations developed during an Academy of Managed Care Pharmacy partnership forum (of which Xcenda was a supporter and participant) to allow biopharmaceutical manufacturers to proactively share clinical and economic information with population health decision makers on emerging therapies in advance of Food and Drug Administration (FDA) approval. The bill has evolved and now includes medical devices and language that the information shared be truthful and not misleading.

The bill passed out of committee on partisan lines with Democrats voicing concerns that the bill does not contain sufficient safeguards to prevent the dissemination of false and misleading information. However, the Democrats also stated that they believed the bill had merit and that they would like to work with the majority to arrive at a compromise in advance of the Energy and Commerce Committee markup.

If passed through full committee, HR 2026 may move forward in conjunction with the OTC Monograph User Fee Act, a bill that was also advanced out of the Subcommittee on Health on Wednesday.

 

Legislative Bytes

 
 

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REGULATORY UPDATES
 

Working for a Living: Medicaid Puts in Employment Criteria Option

 
 

Last week, the Centers for Medicare & Medicaid Services (CMS) issued guidance allowing states more autonomy in setting eligibility and coverage criteria for Medicaid beneficiaries. This new policy is designed to encourage states to “improve health outcomes” by promoting employment and community engagement among the working-aged, non-pregnant, and non-disabled.

A day after CMS issued the guidance, Kentucky became the first state authorized by the agency to implement a “work waiver” which will apply to non-disabled adult beneficiaries enrolled under traditional and expanded Medicaid.

In addition to exemptions for various groups such as pregnant women, primary caregivers of a dependent, and full-time students, the key initiatives in the KY waiver include:

  • Implementation of premiums for certain adults
  • Community engagement requirements as a condition of eligibility
  • Documentation of 80 hours per month of community engagement activities, defined as employment, education, job skills training, and community service
  • Implementation of non-eligibility periods for non-compliance

Critics promised to sue the state, claiming that work requirements violate current Medicaid statutes, while those with a history of disabilities and mental health issues would be unfairly impacted due to being unable to consistently meet the work and community engagement requirements.

Similar Medicaid waiver proposals containing an employment provision are pending review by CMS in Arizona, Arkansas, Indiana, Kansas, Maine, New Hampshire, North Carolina, Utah, and Wisconsin.

It is clear that the states are where we may see the most innovation moving forward—a trend supported by the Trump Administration. Additional details on the potential future of Medicaid were addressed last November in a speech by CMS Administrator Seema Verma to the National Association of Medicaid Directors (NAMD). Focusing on “Flexibility, Accountability, and Integrity,” Verma repeatedly called on the states to not wait on CMS to develop unique and innovative solutions to address cost and outcomes.

 

Why Do Today What You Can Do Later? FDA Delays Off-Label Marketing Rule

 
 

In a wintery season marked by weather-related delays across much of the country, Scott Gottlieb, head of the FDA, announced last week that the agency will follow suit with a delay of its own involving the final rule on intended-use regulations. Describing the types of evidence that may be considered when determining a medical product’s intended uses, the rule had the potential to govern how the FDA would regulate off-label marketing.

Now delayed until further notice, the rule was put forward a year ago this month and was intended to take effect in March of this year.

The intended-use language was included in a final rule notice on the regulation of tobacco products. To avoid delaying implementation of the tobacco-related portion of the rule, the FDA separated it from the intended-use language. This will allow the rule governing tobacco products to go into effect while the intended-use content is indefinitely delayed.

In the meantime, the FDA indicated that manufacturers should defer to the existing regulations on intended use. The agency has opened a comment period that will remain open until February 5, 2018 to: 1) allow time to review comments received on the proposal to delay the March 19, 2018 effective date of the intended-use portion of the rule; and 2) prepare and publish a final rule effectuating the proposed delay.

The FDA had appeared to be moving toward issuing off-label regulation, including an extensive 2-day public hearing in November 2016. More information will likely be released in the final rule implementing the delay.

 

MedPAC Recommends Changes to MIPS and Biosimilars in Part D

 
 

Last Thursday, the Medicare Payment Advisory Commission (MedPAC) held its January meeting where, among a variety of topics, commissioners voted on recommendations for biosimilar coverage in the Medicare prescription drug benefit (Part D) and changes to the Merit-based Incentive Payment System (MIPS).

The commissioners discussed the disincentive for the use of biosimilars in Part D due to their exclusion from the Coverage Gap Discount Program (CGDP). MedPAC staff offered a recommendation to change Part D’s CGDP as follows: 1) to update the CGDP to categorize biosimilars as brand drugs, thus requiring biosimilar manufacturers to pay the 50% coverage-gap discount; and 2) to exclude those manufacturer payments from beneficiaries’ true out-of-pocket spending. If the first recommendation is implemented, biosimilars may gain market share and become more of a competitive force in the Part D program. The commissioners voted unanimously for the changes in the CGDP.

The commissioners also voiced concerns that MIPS, as currently written, will not succeed in its goal to be a productive value-based payment model; the commission characterized it as “a handful of old programs re-purposed into MIPS.” Additionally, the MedPAC staff stated that some measures do not correspond to meaningful health-related outcomes that will provide the public with more information about providers or would change treatment.

The commissioners voted to recommend eliminating MIPS and establishing a voluntary value program (VVP) for Medicare fee-for-service (FFS). In the VVP, as proposed, clinicians can be measured as a voluntary group to qualify for value-based payment based on group performance on a set of population-based measures.

Ultimately, the results in any value-based program are contingent upon the value of the information reported by clinicians, and the ability to alter clinical performance for better outcomes. Given this is an ongoing, years-long process, look for the low-hanging fruit of proven measures as those likely to be adopted first if CMS moves forward with this approach.

The recommendations endorsed by MedPAC commissioners at their January meeting will be included in a March report to Congress. But, as always caveated with MedPAC recommendations, these are non-binding recommendations. The changes voted on by the commission often require significant legislative and/or regulatory changes that would need to be taken up by the federal government.

 

2018, the Year of Part B Change?

 
 

Sen. Chris Van Hollen (D-MD) and Rep. John Yarmuth (D-KY) asked the Government Accountability Office (GAO) to examine the Medicare Part B (physician-administered) drug market as CMS and Congress are considering whether and how to refine Medicare’s payment rate methodology for Part B drugs.

The resulting GAO study determined that Medicare Part B represented at least half of the market for 22 of the 84 (26%) most expensive drugs in 2015. The report, released Wednesday, suggests manufacturers are less incentivized to price these 22 drugs competitively than they, or other manufacturers, are when pricing drugs in which Medicare represents a minority share of the market.

In contrast to Medicare, private insurers can exert pressure on a manufacturer to lower its drug price by positioning it on a less desirable tier of its formulary, placing restrictions on it, or refusing to put it on the formulary altogether. Medicare exerts no such pressure because of its average sales price (ASP) methodology and the program’s requirement to cover all treatments deemed medically necessary. Consequently, according to the GAO analysis, as the proportion of market share covered by Medicare Part B increases, the pressure to keep the price competitive decreases.

The study results may place further pressure on efforts to restrain Part B spending, potentially including recommendations from MedPAC that would use consolidated billing codes for a reference biologic and its biosimilars, and implementation of a Drug Value Program (DVP) that, among other things, would utilize private vendors to negotiate the pricing of Medicare Part B drug payments.

 

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:

 

Insights on Innovation, Value, and Healthier Futures From ThinkLive 2017

 
 
Four Questions That Will Move Pharma Forward

What is value? How is it defined? These and other questions were explored during AmerisourceBergen’s ThinkLive pharmaceutical manufacturer summit, where more than 500 manufacturers engaged and shared what will guide pharma business decisions in 2018 and beyond. Learn more

 

 

 
HEARD ON THE STREET
 

“Americans deserve affordable choices, and we are concerned that the changes proposed would lead to higher prices and weaker consumer protections in the small group and individual markets, where nearly 40 million Americans get their coverage.

 

– Statement by America’s Health Insurance Plans, expressing little interest in the Department of Labor’s proposal to allow employers to join together as a single group to purchase insurance in the large group market

 
POLICY BY NUMBERS
 

11% to 139%

 

The Congressional Budget Office (CBO) analyzed the prices 3 major insurers paid for 20 services and found that those insurers paid average commercial prices that were between 11% and 139% higher than Medicare FFS prices.

Source: “An Analysis of Private-Sector Prices for Physicians’ Services,” CBO, January 2018

 
UPCOMING MEETINGS & CONFERENCES
 

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.

 

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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FEATURED CONTRIBUTORS
 

EDITOR-IN-CHIEF:
Jennifer Snow
Senior Director,
Health Policy
Xcenda

MANAGING EDITOR:
Scott Shields
Associate Director,
Health Policy
Xcenda

 

ADVISORY BOARD:

Peyton Howell, MHA
President | Global Sourcing & Manufacturer Relations | 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

CONTRIBUTING AUTHORS:

Andrew Gaiser | Stew Kaufman | Scott Shields | Diane Smith | Jennifer Snow | Stephen Wilson

PRODUCTION:

Laurie Kozbelt | Ellen Olson

 

Jan. 19, 2018

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