McDermottPlus Check-Up: July 21, 2023 - McDermott+Consulting

McDermottPlus Check-Up: July 21, 2023


The House and Senate were both in session this week, with healthcare activity at the committee level. The House Energy and Commerce Committee held a hearing on innovation and a markup of 15 healthcare bills. The Senate Finance Health Care Subcommittee held a hearing on the US transplant system, and the Senate Health, Education, Labor and Pensions (HELP) Committee held a markup of its Pandemic and All-Hazards Preparedness Act (PAHPA) reauthorization bill. The US Department of Health and Human Services (HHS) announced funding to combat multiple facets of substance misuse and the nation’s overdose epidemic.


House Energy and Commerce Committee Holds Hearing on Innovation, Markup of Healthcare Bills. On July 18, the House Energy and Commerce Health Subcommittee met to discuss Medicare coverage pathways for innovative drugs, medical devices and technology. Several members of the subcommittee and witnesses highlighted concerns regarding delays in access to care and solutions that are necessary to expedite access to breakthrough medical therapies. Subcommittee members and witnesses acknowledged that they were pleased that the Centers for Medicare and Medicaid Services (CMS) finally released the Transitional Coverage for Emerging Technologies (TCET) notice, but several expressed concern over requirements for innovators to go through a lengthy evidence development process without a predictable or transparent coverage pathway.

The lack of access to timely care for severe medical conditions was also heavily discussed, and many witnesses highlighted that early detection can often lead to better outcomes, especially for seniors and other vulnerable communities. The hearing also included discussion on the need for increased timely access to breakthrough therapies to reduce health disparities.

On July 19, the full Energy and Commerce Committee advanced 15 bills during a lengthy markup. Similar to last week’s Health Subcommittee markup, the wide-ranging list of bills included efforts to reauthorize PAHPA, a bill to continue a pandemic-era telehealth benefit, and efforts to reauthorize programs related to maternal health and children’s hospital graduate medical education (CHGME). These issues once again faced significant party-line debate and were advanced largely along party lines.

Opening statements from Chair Rodgers (R-WA) and Ranking Member Pallone (D-NJ) can be found here and here, respectively. The text, amendments and vote outcomes for each bill can be found here, and more detailed summaries can be found in the markup memo. Outcomes on the most prominent bills include the following:

  • H.R. 4421, the Preparing for All Hazards and Pathogens Reauthorization Act, would reauthorize current programs to support public health security and all-hazards response, including the strategic national stockpile, biomedical advanced research and development authority, and public health emergency medical countermeasures enterprise. It does not include provisions sought by Democrats to address the issue of drug supply shortages.
    • This bill advanced along party lines by a vote of 28–23.
  • H.R. 824, the Telehealth Benefit Expansion for Workers Act of 2023, would increase employers’ ability to offer stand-alone coverage of telehealth-only services to employees.
    • This bill advanced largely along party lines by a vote of 29–20. Rep. Craig (D-MN) was the only Democrat who voted in favor of the bill.
  • H.R. 4420, the Preparedness and Response Reauthorization Act, would reauthorize certain programs related to the Centers for Disease Control and Prevention (CDC) and includes provisions aimed at supporting the distribution of medical countermeasures, control of biological agents and mosquito-borne diseases, and epidemiological monitoring.
    • This bill advanced along party lines by a vote of 27–22.
  • H.R. 3887, the CHGME Support Reauthorization Act, would reauthorize payments to children’s hospitals that operate graduate medical education programs for fiscal years 2024–2028. The legislation includes a prohibition on payments to children’s hospitals that furnish procedures and drugs to minors related to gender-affirming care.
    • This bill advanced along party lines by a vote of 27–17.
  • H.R. 4531, the Support for Patients and Communities Reauthorization Act, would reauthorize and make changes to key programs to combat opioid addiction.
    • This bill advanced by a vote of 49–0.

Senate Finance Committee Holds Hearing on US Transplant System. On July 20, the Senate Finance Health Care Subcommittee met to discuss the cost of inaction and the urgent need to transform the US transplant system. The discussion included bipartisan recognition, support and urgency for the problems in the transplant system and the need for a consensus on ways to reform it. There was a unified call from the witness panel and senators for transparency in data, enforcement standards and realigned incentives in the organ transplant process. Concerns were also expressed about the United Network for Organ Sharing being a monopoly and potentially preventing reform in the system at the cost of patient lives.

Senate HELP Committee Advances PAHPA Reauthorization Bill. On July 20, the Senate HELP Committee met to consider legislation to reauthorize PAHPA (S. 2333), which is set to expire on September 30 without congressional action. The legislation was approved by a vote of 17–3, with Sen. Paul (R-KY), Sen. Braun (R-IN) and Sen. Tuberville (R-AL) voting against the bill.

On July 18, in advance of the markup, Chairman Sanders (I-VT) and Ranking Member Cassidy (R-LA) announced that they had reached a bipartisan agreement on the reauthorization effort, which includes provisions to address drug shortages. This agreement is markedly different than the reauthorization process in the House Energy and Commerce Committee, where PAHPA legislation was advanced along party lines after Republicans were unwilling to add the drug shortage provisions on which Democrats hinged their support.

With very different packages likely moving forward in the Senate and House, those differences will need to be reconciled in order to enact a bill that will become law. And the September 30 program expiration date is fast approaching.

Senate HELP Committee Chairman Sanders Introduces Primary Care Bill. Chairman Sanders introduced a broad bill this week designed to improve primary care access and quality, including provisions to significantly increase funding for community health centers, reauthorize the Teaching Health Center Graduate Medical Education program, and fund the National Health Service Corps—all of which expire on September 30 without congressional action. The bill would also create 10,000 new graduate medical education slots and would advance additional programs to increase the pipeline for nurses, mental health providers, dental providers and more. The bill includes a provision that would restrict providers and facilities delivering services in off-campus outpatient departments from charging more than the median amount that a payer or issuer would pay if the service were delivered in a physician’s office.

Chairman Sanders announced that the HELP Committee will mark up his new legislation on July 26. More details about the chairman’s bill can be found in the press release, the section-by-section and the full bill text.

Across the aisle, last week Ranking Member Cassidy introduced the Community Health Center Reauthorization Act, which contains many of the same reauthorizations. Chairman Sanders’s bill is more wide-sweeping than Ranking Member Cassidy’s, and the ranking member does not support the chairman’s bill, setting the stage for a partisan HELP Committee markup next week.


FTC, HHS Caution Hospitals and Telehealth Providers on Privacy and Security Risks from Online Tracking Technologies. On July 20, the Federal Trade Commission (FTC) and the HHS Office for Civil Rights (OCR) announced that they are cautioning hospitals and telehealth providers about the privacy and security risks related to the use of online tracking technologies integrated into their websites or mobile apps that may impermissibly disclose consumers’ sensitive personal health data to third parties.

FTC and HHS OCR sent a joint letter to approximately 130 hospital systems and telehealth providers focusing on the risks and concerns about the use of technologies, such as the Meta/Facebook pixel and Google Analytics, that can track a user’s online activities. In their letter, both agencies reiterated the risks posed by the unauthorized disclosure of an individual’s personal health information to third parties.

This builds on a bulletin HHS issued late last year that reminded entities covered by the Health Insurance Portability and Accountability Act (HIPAA) of their responsibilities to protect health data from unauthorized disclosure under the law. The joint letter added that even entities that are not covered by HIPAA still have an obligation to protect against impermissible disclosures of personal health information under the FTC Act and the FTC Health Breach Notification Rule.

SAMHSA Distributes Grant Funding for Programs Expanding Access to Medications for Opioid Use Disorder. On July 19, the US Substance Abuse and Mental Health Services Administration (SAMHSA), which is part of HHS, announced awards in five grant programs devoted to combating multiple facets of substance misuse and the nation’s overdose epidemic. The grant awards total $47.8 million. The five grant programs are the Medication-Assisted Treatment-Prescription Drug and Opioid Addiction grant program, Emergency Department Alternatives to Opioids Demonstration Program, Sober Truth on Preventing Underage Drinking Act program, Adult Reentry program, and State Pilot Grant Program for Treatment for Pregnant and Postpartum Women.

The grant awards facilitate ongoing efforts throughout the United States in prevention, treatment, recovery support and harm reduction—the pillars of HHS’s Overdose Prevention Strategy. The Overdose Prevention Strategy helps advance the Biden-Harris Administration’s National Drug Control Strategy, which delivers on the call to action in President Biden’s Unity Agenda for a whole-of-government approach to beat the overdose epidemic.

HHS OIG Releases Report on Medicaid Managed Care Prior Authorization Practices. The HHS Office of Inspector General (OIG) released a report titled “High Rates of Prior Authorization Denials by Some Plans and Limited State Oversight Raise Concerns About Access to Care in Medicaid Managed Care.” In the report, OIG analyzed of Medicaid Managed Care Organization (MCO) prior authorization practices. OIG recommended the following actions:

  • Requiring states to regularly review the appropriateness of a sample of MCO prior authorization denials
  • Requiring states to collect data on MCO prior authorization decisions
  • Issuing guidance to states on the use of MCO prior authorization data for oversight
  • Requiring states to implement automatic external medical reviews of upheld MCO prior authorization denials
  • Working with states on actions to identify and address MCOs that may be issuing inappropriate prior authorization denials.

This report follows continued OIG scrutiny of prior authorization practices, including a previous report released in April 2022. That report, titled “Some Medicare Advantage Organization Denials of Prior Authorization Requests Raise Concerns About Beneficiary Access to Medically Necessary Care,” evaluated prior authorization practices used by Medicare Advantage Organizations (MAOs) and how they negatively impact patients who need immediate medical care. The report found that MAOs sometimes delayed or denied Medicare Advantage beneficiaries’ access to services, even though the requests met Medicare coverage rules. MAOs also denied payments to providers for some services that met both Medicare coverage rules and MAO billing rules. OIG recommended that CMS issue new guidance on the appropriate use of MAO clinical criteria in medical necessity reviews, update its audit protocols to address the issues identified in the report, and direct MAOs to take additional steps to identify and address vulnerabilities that can lead to manual review errors and system errors.


  • HHS Secretary Becerra released a statement celebrating the one-year anniversary of the launch of 988, the three-digit Suicide & Crisis Lifeline. He noted that almost five million calls, texts and chats have been answered over the past year, saving countless lives. He highlighted the new addition of Spanish language services and mentioned that HHS will continue to expand the reach of 988 and encourage people across the country, in all different communities, to seek help if they need it.
  • The CDC will launch the Bridge Access Program for COVID-19 Vaccines this fall. A dedicated team within CDC’s Immunization Services Division has been established to help launch the new program. CDC will purchase COVID-19 vaccines and allocate them, along with the funding needed to implement this new program, through CDC’s established network of state and local immunization programs. These partners will then facilitate distribution of these vaccines to participating community-based providers, including local health departments and Health Resources and Services Administration-supported health centers. In order to broaden access, CDC is also working closely with select national pharmacy chains, as well as vaccine manufacturers, to enable uninsured adults to receive free COVID-19 vaccines at participating retail pharmacy locations.


Next week is the final week the House and Senate will be in session prior to the month-long August recess. Healthcare activity is planned at the committee level, including a Senate Finance Committee markup of pharmacy benefit manager reform legislation and a Senate HELP Committee markup of the healthcare package introduced by Chairman Sanders this week.

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

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