Chart of the Week
Congress.
Medicaid Gap. House Majority Whip, Jim Clyburn has stated his intention of including in budget reconciliation for FY 2022 a mechanism to close the Medicaid gap. While leadership has not yet settled on an approach, the logical one is to expand tax credits to people who live in non-expansion states but would otherwise be eligible for Medicaid. There are about 2 million people in the gap (BHG, OSCR).
Local Governments Get into Medicaid? Rep. Lloyd Doggett introduced a bill that would allow local governments to contract with CMS is expand Medicaid. Nice thought and certainly appeals to partisans as many cities in red states would be supportive. The idea is also unworkable for the foreseeable future as local governments do not have the taxing authority necessary to provide the matching funds, among other problems. (ANTM, UNH, CNC, MOH)
Home and Community-based Services Expansion. A Biden priority and to which Republicans are opposed given its close links to unions, is an $400B expansion of Medicaid Home and Community-based Services. Democratic leadership wants it included in reconciliation. Between the lines, the expansion is a recognition that the nursing facility industry is in secular decline, propped up long past its due date through state-level political activism. COVID-19 only accelerated the inevitable. Another conclusion to be had is that developmentally disabled children of aging post-war generation parents are going to be in need of caregivers as their primary source of support passes on. (INNV, ADUS)
CURES 2.0. This long-anticipated bi-partisan bill aims to be a follow-on to the NIH Funding-palooza of 2016. The intent of a bi-partisan group of sponsors that includes leadership is to improve the way therapies are used and delivered to patients. To that end the bill has the following relevant provisions:
- Increasing diversity in clinical trials
- Collection and reporting of patient experience during clinical trials
- Increasing use of Real-World Evidence in clinical trial design
The bill also appears to be a vehicle for addressing the end of telehealth flexibilities. These provisions include:
- New guidance on Medicaid coverage of telehealth for pediatric patients
- Permanent removal of Medicare’s geographical and originating site restriction with permission granted to HHS to identify and approve providers that can offer telehealth and which services will be reimbursed. Note to “sky is the limit” telehealth consensus: Do not expect too many flexibilities initially except in behavioral health. There is a significant policy headwind for doc’s prescribing and treating without established patient-doctor relationship. (GDRX, AMZN, TDOC, AMWL, DOCS)
Since no bill is complete without genetic testing, Cures 2.0 would allow for federal support of genetic and genomic testing for pediatric patients with rare disease. The bill would also codify the Trump-era MCIT Medicare reimbursement pathway for breakthrough technologies.
This bill is one of those rare happy, feel-good things that doesn’t cost a bunch of money and actually moves policy forward.
Hearings Next Week.
House Committee on Oversight and Reform, Select Subcommittee on the Coronavirus Crisis Building Trust and Battling Barriers: The Urgent Need to Overcome Vaccine Hesitancy | Thursday, July 1, 2021 at 9:30 A.M.
The White House.
Medicare Rule-A-Rama. Still waiting on:
CY 2022 Home Health annual payment update
Physicians Fee Schedule for 2022 and “other revisions to Medicare Part B”
CY 2022 ESRD annual payment update
CY 2022 Hospital Outpatient annual payment update
Eviction Moratorium. The CDC continued its temporary halt to residential evictions until July 31, 2021. This should be the final extension as almost every acknowledges the CDC is on thin legal ice here.
Also pending at the White House:
Patient Protection and Affordable Care Act; Updating Payment Parameters and Improving Health Insurance Markets for 2022 and Beyond Proposed Rule (CMS-9906)
Requirements Related to Surprise Billing; Part I (CMS-9909).
This rule in Surprise billing will be an Interim Final Rule, meaning it goes into effect in 30 days without a comment period. At least for this “Part I” the industry’s input is not welcomed.
The Department of Labor has submitted for White House approval a rule to implement an Executive Order requiring $15/hr minimum wage for employees of federal contractors. We will wait to see how broadly they define federal contractor and those associated with a federal contract but generally wage rates for these types of contracts in health care already exceed the $15/hr level.
The CDC and HHS are also reviewing a notice related to mask wearing on passenger carrying conveyances. Since there is already a mandate in place, this notice is a modification of current policy – whatever that means.
Genie Leaves Bottle. The FDA’s controversial approval of Aduhelm has naturally led to other Breakthrough Therapy Designations with LLY saying they are planning to file for accelerated approval for its investigational Alzheimer’s drug soon.
Other Stuff.
Provider Relief Funds. The AHA is asking HHS to extend the period in which provider must spend or repay their provider relief money. HHS had issued new guidance that stablished deadline based on when money was released. Provider Relief money sent to providers between April 10 and June 30, 2020 must be used or repaid by June 30, 2021. Monies disbursed between July 1, 2020 and Dec. 31, 2020 must be used ore repaid by Dec. 31, 2021. Finally, any money disbursed between Jan 1, 2021 and June 30, 2021 must be used or repaid by June 30, 2022. The AHA and others would like the deadline to be extended to the end of the Public Health Emergency which should be year end or June 30, 2022.
Telehealth Has Its Limits. Data released from the Pew Charitable Trust on Medicare spending suggests telehealth was not enough to get people back to the doctor. During the pandemic, telehealth was 13% of physician visits but overall total visits remained depressed throughout 2020. Making it easier, in other words, did not seem to address access, something that will be an important consideration as Congress considers extensions to the telehealth flexibilities.
Slow and Steady Wins the Race? Personal Consumption Expenditures for the two major service categories in health care: outpatient services and hospitals are moving incrementally in a positive direction. Still, things are not up to pre-COVID levels, which begs the question: will they ever be? And if so when? Labor continues to be a problem as burnout, retirements and people looking for other things to do, keep warm bodies in short supply.
SPAC and S-1 Corner.
Interesting S-1s
Sight Sciences. (MS) “Our mission is to transform ophthalmology and optometry through the development and commercialization of proprietary devices that target the underlying causes of the world’s most prevalent eye diseases.” Two market products include OMNI Surgical Systems and TearCare, which target glaucoma and dry eye disease.
SPAC Corner
There is still about $13B in dry power from closed SPACs hanging around looking for a dance partner. Another $14B are moving slowly through the registration process.
You can access the updated SPAC spreadsheet here.
If you are investing in SPACs but not super familiar with health care, hit and we can help.
Recent Events.
June 21st @ 10am ET PIVOT TO DIRECT CONTRACTING | DATA DEEP DIVE: CANO, CMAX, PRVA, AGL
For the video recap, link here.
Upcoming Events.
June 30th @ 2pm ET Health Policy Mid-Year Update: Labor Supply & Costs, Supply Shifts; and More with Tom Tobin, Health Care Sector Head
July 14th @ 10am ET Brad Smith, former Director of the Innovation Center at CMS and I will be talking about the history and potential of direct contracting.
Emily Evans
Managing Director – Health Policy
