Advocacy Update

July 26, 2018: National Advocacy Update


The AMA has heard concerns from some state medical societies about repayment demands from Medicare Administrative Contractor (MAC) Palmetto covering a four-year period. These demands are being directed at rural health clinics (RHCs) related to services provided to Medicare Advantage (MA) patients but erroneously paid by the MAC, which was then Cahaba.

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The AMA understands that 1,000 RHCs across 29 states are affected, in addition to other types of facilities. The AMA's understanding is that, due to a lack of oversight by Cahaba at the time of claims processing, Medicare paid some claims for services received by MA patients. Palmetto is now attempting to recuperate these incorrect payments on Medicare's behalf.

Palmetto has clarified that RHCs have until Aug. 17 to submit an initial exception request. RHCs should submit these requests as soon as possible. Palmetto needs only receive an initial exception request—with documentation—to postpone recoupment of all claims for which recoupment is sought until a determination is made about the legitimacy of the challenged claims.

In other words, even if a physician is unable to complete review of all claims prior to Aug. 17, recoupment will be stopped for all claims upon receipt of a valid initial exception request. On Aug. 18, Palmetto will begin the auto-cancellation of affected claims for providers who do not submit a valid initial exception request by the deadline.

Of note, MA plans will need to waive their timely filing policies to allow RHCs to refile the claims. The AMA has spoken to the CMS about this matter and offered its assistance. The AMA will continue to monitor the situation.

The Food and Drug Administration (FDA) recently announced plans to form a new task force dedicated to addressing drug shortages. While the FDA has seen a drop in newly reported drug shortages, a number of shortages of medically necessary drug products are ongoing. Some of these, including shortages of many sterile intravenous drug products, were exacerbated by the hurricanes affecting manufacturing facilities in Puerto Rico.

The new task force will do a deep dive into the root of ongoing shortages and aims to find "holistic solutions that address the underlying causes." Notably, the task force will include senior FDA officials, as well as senior leaders from the CMS and the Department of Veterans Affairs.

Together, task force members will examine the impact of reimbursement policies on drug shortages, look at incentives to encourage manufacturing capacity and consider development of a critical drugs list, among other items. The FDA also plans to engage stakeholders on this issue through public meetings in upcoming months. The AMA continues to work closely with FDA, physician specialty societies and other stakeholders on this important issue.

On July 16, the AMA submitted detailed comments (PDF) in response to the Administration's "American Patients First: The Trump Administration Blueprint to Lower Drug Prices and Reduce Out-Of-Pocket Costs." The AMA comments focused on lower prices through increased competition, ensuring continued access to affordable treatments for all patients, ensuring that providers are not bearing the brunt of cost-cutting measures, reducing physician administrative burdens and increasing transparency.

The blueprint contained a significant number of ideas and proposals to lower drug spending, some of which the AMA can support, such as efforts by the FDA to reduce anticompetitive use of certain FDA controls to stifle generic competition, prohibit gag clauses on retail pharmacists, and increase transparency. Others raised concern, such as proposals to move some Medicare Part B physician-administered drugs into the Part D drug benefit and efforts that would impose potentially severe new restrictions on Part D formularies.

The AMA also used the call for comment as an opportunity to share views on issues such as value-based pricing, increased transparency for both drug manufacturers and pharmacy benefit managers, and the impacts of administrative burdens such a prior authorization for certain high-cost treatments.

While some proposals included in the blueprint are already being undertaken by government agencies, a number of items would require new legislative or regulatory actions to take shape. The administration has not provided a timeline for when it may begin work on many of these proposals, so no immediate action or changes are expected. The AMA will continue to work closely with the administration, the physician community and other stakeholders to help improve treatment affordability and access for patients.

On July 17, the House Energy and Commerce Committee unanimously approved H.R. 6378, the "Pandemic and All-Hazards Preparedness and Advancing Innovation Act of 2018," which includes H.R. 1876, the "Good Samaritan Health Professionals Act of 2018." H.R. 1876, which was introduced by Rep. Marsha Blackburn, R-Tenn., would improve disaster response surge capacity by providing uniform liability protections for all licensed health care professionals volunteering to provide needed health services to victims during federally declared disasters.

In order to receive this protection, the health professional must: volunteer and not receive any compensation; act within the scope of license in their home state; and provide services in the state of the declared disaster. The AMA strongly supports H.R 1876 and sent a letter (PDF) to the House Energy and Commerce Committee earlier this month calling for its inclusion in H.R. 6378. The House is expected to consider H.R. 6378 in September.

The House Ways and Means and Committee approved 10 bills on July 10 that would provide more flexibility in the design of high-deductible health plans used in conjunction with health savings accounts (HSAs), and make other changes that could expand access to and use of HSAs and other consumer-directed health care plans. AMA policy supports HSAs and other forms of consumer-driven health care coverage as important options in the health insurance marketplace for those who choose to use them.

The AMA supports several of these bills as approved by the committee, including H.R. 6199, the "Restoring Access to Medication Act of 2018," which was introduced by Rep. Lynn Jenkins, R-Kan., and would repeal the Affordable Care Act prohibition on using flexible spending accounts, HSAs and other similar tax-preferred health accounts to purchase over-the-counter medications. It also adds feminine or "menstrual care" products to the list of qualified medical expenses for the purposes of these accounts.

The AMA also supports legislation introduced by Reps. Erik Paulsen, R-Minn., and Earl Blumenauer, D-Ore., H.R. 6317, the "Primary Care Enhancement Act," which would allow HSAs to be used to pay for expenses associated with direct primary care arrangements. The 10 bills will be consolidated into two bills, H.R. 6199 and H.R. 6311, and will be considered on the House floor this week.