McDermottPlus Check-Up: January 19, 2024 - McDermott+Consulting

McDermottPlus Check-Up: January 19, 2024


  • Congress Passes CR: Congress passed a continuing resolution (CR) to keep the government funded into early March.
  • Senate Hearing on Long COVID: The Senate Health, Education, Labor & Pensions (HELP) Committee held a hearing to discuss solutions addressing long COVID.
  • CMS Issues Prior Authorization Final Rule: The Centers for Medicare & Medicaid Services (CMS) finalized its interoperability and prior authorization final rule.


Congress Passes CR and Averts Government Shutdown. As appropriators continue to draft the 12 funding bills for FY 2024, a new stopgap CR was needed to avoid a partial government shutdown on January 19. The Senate passed the CR by a vote of 77-18 on January 18, and the House quickly followed suit the same day, advancing the CR by a vote of 314-108. Lawmakers moved quickly on final passage as a snowstorm approached DC, threatening to disrupt lawmakers’ travel plans. President Biden is expected to sign the CR imminently. It’s worth noting that House Speaker Johnson (R-LA) agreed to another short-term CR despite opposition from the conservative wing of his party, which meant that he needed to rely on House Democrats to advance the bill (indeed, all but two Democrats voted in favor of the CR, while 106 Republicans voted against it).

The new CR includes a two-tiered funding structure similar to the previous CR, extending four of the 12 annual appropriations bills through March 1, and the remaining eight through March 8. It also extends through March 8 the same short-term healthcare provisions from the previous CR, including funding for community health centers, the National Health Service Corps, the Special Diabetes Programs, the geographic practice cost indices work floor, and preventing cuts to the Medicaid disproportionate share hospital program.

The new CR does not include other key healthcare policies, despite pressure on Congress to act. A few examples of issues left out of the CR include mitigating Medicare physician payment cuts, extending funding for children’s hospitals that provide physician training, continuing the Medicare advanced alternative payment model bonus, extending Medicare beneficiary outreach and enrollment funding that connects lower-income Medicare beneficiaries with programs that help cover their healthcare cost-sharing, pharmacy benefit manager reforms, reauthorizing the SUPPORT Act, and addressing transparency reforms. We expect negotiations on these provisions to continue in the coming weeks, for potential inclusion in the final FY 2024 spending package.

Senate HELP Committee Holds Hearing on Long COVID. The hearing examined actions that can be taken to address the long COVID crisis. Witnesses and members emphasized that long COVID is an emerging and under-recognized illness that has impacted many Americans. Republican senators expressed frustration with the federal government’s lack of action in improving treatments for long COVID patients. Senators suggested expanded funding for long COVID treatment and diagnosis research, as well as preventative measures. Democratic senators highlighted disparities in access to care and long COVID impacts for minority and low-income groups. Witnesses pointed out administrative barriers to care and a lack of education on long COVID diagnoses from medical professionals.


CMS Issues Final Rule on Interoperability and Prior Authorization. The final rule requires payers to automate and provide transparency about prior authorization processes. Key points from the final rule are as follows:

  • Impacted Payers: The impacted payers include Medicare Advantage plans, state Medicaid and Children’s Health Insurance Program (CHIP) fee-for-service programs, Medicaid managed care plans and CHIP managed care entities, and Qualified Health Plan issuers on the Federally Facilitated Exchanges.
  • Prior Authorization: Starting January 1, 2027, these impacted payers will be required to build and maintain application programming interfaces (APIs) that will help automate the process for providers to determine whether a prior authorization is required, identify prior authorization information and documentation requirements, and facilitate the exchange of prior authorization requests and decisions from their electronic health records or practice management system.
    • Beginning in 2026, impacted payers must provide a specific reason for denied prior authorization decisions, regardless of the method used to send the prior authorization request.
    • Payers must send prior authorization decisions within 72 hours for expedited (i.e., urgent) requests and seven calendar days for standard (i.e., non-urgent) requests.
    • Impacted payers must also add information about prior authorizations (excluding those for drugs) via a Patient Access API. This requirement becomes effective on January 1, 2027.
  • New Provider Requirements: To encourage providers to adopt electronic prior authorization processes, starting in 2027 CMS will add a new measure titled Electronic Prior Authorization to the Health Information Exchange objective for the Merit-based Incentive Payment System Promoting Interoperability performance category and the Medicare Promoting Interoperability Program.
  • Timeline: In a change from the proposed rule, many of these requirements will take effect on January 1, 2027, a one-year implementation delay from what was proposed. The initial set of metrics must be reported by March 31, 2026.

The CMS fact sheet can be found here.

CMS Holds Webinar on AHEAD Model. The purpose of this webinar was to answer questions related to the States Advancing All-Payer Health Equity and Development (AHEAD) Model Notice of Funding Opportunity.

Additional information about the program can be found here, along with a new fact sheet here. The goal of the program is to provide a framework focused on reducing healthcare cost growth, improving population health and advancing health equity. During the call, CMS answered several questions on topics such as cohort selection, eligibility requirements and the use of telehealth waivers. CMS will release information regarding financial specifications in February. This specification document will likely answer many questions regarding the structure of the model.

A recording and transcript of the call will be posted here in about two weeks. The next Notice of Funding Opportunity office hours webinar will be held on January 30 at 3:00 pm EST.


Administration Drops Cost-Sharing Appeal. By way of background, the US District Court for the District of Columbia overturned the 2021 Notice of Benefit and Payment Parameters final rule that would have had the effect of permitting health issuers and health plans to not count copay assistance from manufacturer and non-profit copay assistance programs toward maximum out-of-pocket limits. The US Department of Health and Human Services (HHS), along with CMS, appealed the decision. In December 2023, a bipartisan group of senators sent a letter to HHS urging the department to reconsider its appeal of the decision. The letter noted that the decision was an important step in the right direction for low-income and other eligible patients who rely on manufacturer and nonprofit copay assistance programs to address affordability and access challenges for their medicines. This week, HHS filed a joint stipulation to dismiss the appeal.


  • CMS Announces New Behavioral Health Model. The Innovation in Behavioral Health (IBH) Model will test approaches to improve the quality of care and health outcomes for people with moderate-to-severe mental health conditions and/or substance use disorders, by connecting them with the physical, behavioral and social supports necessary to manage their care. The IBH Model will be tested by the CMS Innovation Center, and practice participants in the model will be community-based behavioral health organizations and providers. CMS will release a Notice of Funding Opportunity for the IBH Model this spring, and the model will launch in fall 2024. CMS anticipates that the model will operate for eight years in up to eight states. Additional information can be found on the Innovation Center’s IBH Model page, in CMS’s fact sheet and in this FAQ document.
  • ARPA-H Announces Program to Increase Access in Rural Communities. The Advanced Research Projects Agency for Health (ARPA-H) announced the Platform Accelerating Rural Access to Distributed & InteGrated Medical care (PARADIGM) program. PARADIGM aims to address the current challenges in rural health by creating a scalable vehicle platform that can provide advanced medical services outside of a hospital setting. The goal of PARADIGM is to deliver hospital-level care via a multi-purpose Care Delivery Platform (CDP), which will pioneer new developments in point-of-care diagnostics, ensure seamless data exchange between medical devices and EHRs, and offer real-time guidance for medical tasks. The CDP is designed for large-scale deployment by healthcare systems, particularly in rural and resource-limited settings.
  • GAO Releases Report on Veteran Maternal and Mental Health. The US Government Accountability Office (GAO) analyzed Veterans Affairs (VA) data on deaths and severe maternal morbidity among pregnant and postpartum veterans from fiscal years 2011 through 2020. GAO made two recommendations to the VA: monitor trends in severe maternal morbidity by veteran characteristics, such as race and ethnicity, and monitor maternity care coordinators’ screening of veterans for mental health conditions, including the completion of these screenings and screening results. VA concurred with GAO’s recommendations.
  • GAO Releases Report on Public Health Preparedness and Workforce. GAO reviewed Administration for Strategic Preparedness and Response (ASPR) documentation and workforce data, and interviewed HHS and Office of Personnel Management officials. GAO made four recommendations that ASPR establish specific goals and performance measures to use for its new hiring office once it is fully operational, develop tailored strategies for recruiting and hiring human capital staff for the new office, identify the critical areas that need workforce assessments and develop plans to implement them, and conduct an agency-wide workforce assessment. HHS neither agreed nor disagreed with the first two recommendations and agreed with the last two recommendations.


The House is scheduled to be in recess next week. The Senate is in session with the potential for healthcare activity at the committee level.

For more information, contact Debra CurtisKristen O’Brien, Priya Rathakrishnan or Erica Stocker.

To subscribe to the McDermottPlus Check-Up, please CLICK HERE.