Health Policy News - McDermottPlus Check-Up: November 10, 2023

McDermottPlus Check-Up: November 10, 2023


  • Senate Markup and Hearing: The Senate Finance Committee moved forward bipartisan legislation that would impact Medicare payment, mental health, pharmacy benefit managers (PBMs) and healthcare extenders. The Senate Health, Education, Labor & Pensions (HELP) Primary Health and Retirement Security Subcommittee held a hearing to examine artificial intelligence (AI) in healthcare.
  • CMS Proposed Rule: The Centers for Medicare & Medicaid Services (CMS) issued a Medicare Advantage (MA) and prescription drug plan proposed rule.


Senate Finance Committee Holds Markup on Better Mental Health Care, Lower-Cost Drugs, and Extenders Act. The bipartisan package includes Medicare and Medicaid extenders, provisions to expand the mental health care workforce and services, and further PBM reforms to reduce prescription drug costs that build on earlier action by the committee on this front. Ten of 56 amendments posted in advance of the markup on the committee website were offered and withdrawn, and six were incorporated into the chairman’s mark considered at the markup. The bill passed the committee by a unanimous vote. The section-by-section analysis of the bill is here, and the description of the chairman’s mark is here. Key payment policies include a 1.75% extension of the advanced alternative payment model bonus (reduced from the current 3.5% bonus in 2023 and an original bonus of 5%) and another 1.25% patch to the physician fee schedule conversion factor that would mitigate Medicare physician payment cuts in 2024.

This markup was another step towards a potential healthcare package, if there is an end-of-year deal that includes healthcare. The House has a package with some similar provisions, H.R. 5378, the Lower Costs, More Transparency Act. Also on the table is the PBM legislation passed by the Senate Finance Committee earlier this year. Given the significant challenges Congress faces in legislating this year, however, it is uncertain whether a healthcare package beyond extenders will be possible this year. Moving forward, House and Senate committees of jurisdiction (House Ways & Means, House Energy & Commerce, Senate Finance and Senate HELP), along with House and Senate leadership, will negotiate to determine which healthcare policies might be included in any end-of-year bill and what offsets could be used to pay for them.

Senate HELP Committee Examines AI in Healthcare. The Primary Health and Retirement Security Subcommittee held a hearing to discuss the current risks and benefits of AI within the healthcare system and congressional solutions to mitigate AI’s potential negative impacts on healthcare. Witnesses and members expressed concerns about errors in AI algorithms that lead to inappropriate healthcare decisions, highlighted the risks of bioterrorism, and emphasized regulation of privacy as well as security concerns with health data. Multiple witnesses also emphasized AI’s positive impacts on the healthcare workforce, including improved efficiency of clinician notes and reduced clinician burnout. The hearing follows last week’s executive order on AI that tasked multiple federal departments and agencies with addressing issues in this space. Read our +Insight on the executive order here.


CMS Issues MA and Prescription Drug Plan Proposed Rule. CMS issued a proposed rule that would institute changes to the MA and Medicare Part D programs, most of which would be effective in plan year 2025.

Notable provisions in the proposed rule include the following:

  • Following congressional pressure, CMS proposes to limit plan payment to third-party agents and brokers and prohibit contract terms that allow “marketing middlemen” to receive bonuses based on the number of beneficiaries that enroll in certain plans.
  • The rule proposes to add a new category under the MA plan network adequacy standard called “Outpatient Behavioral Health,” which would include marriage and family therapists and mental health counselors, Opioid Treatment Program providers, Community Mental Health Centers, addiction medicine physicians, and other providers who deliver addiction medicine and behavioral health counseling or therapy services in Medicare. In order to expand access to mental health services, CMS proposes to add this Outpatient Behavioral Health facility specialty category to the list of the specialty types that will receive a 10% credit if the MA plan’s contracted network of providers includes one or more telehealth providers.
  • In order to ensure that MA enrollees are taking advantage of supplemental benefits offered to them, CMS proposes to require MA plans to send personalized notices mid-year to enrollees to inform them about supplemental benefits still available for them to access for the rest of the year.
  • CMS proposes new requirements for MA plans to demonstrate that the special supplemental benefits for the chronically ill services they cover meet the “legal threshold of having a reasonable expectation of improving the health or overall function of chronically ill enrollees and are supported by research.”
  • The rule proposes to require health plans to analyze their prior authorization and other utilization management protocols from a health equity perspective.
  • CMS proposes to provide MA enrollees with the same access to Quality Improvement Organization review of a fast-track appeal as traditional Medicare beneficiaries.

Comments are due by January 5, 2024. A fact sheet highlighting the rule’s proposals can be found here, and the CMS press release is here.


  • CMS Will Host AHEAD Model Webinar. The webinar will provide an overview of the Notice of Funding Opportunity (NOFO) for the States Advancing All-Payer Health Equity and Development (AHEAD) Model. This event is tentatively scheduled for November 16, 2023, from 2:00 to 3:00 pm EST. The NOFO will be posted on in the coming days. To register for the webinar, please click here.
  • HHS Outlines Actions to Improve Rural Healthcare. The US Department of Health and Human Services (HHS) issued a press release outlining actions taken by the Administration to improve access to care in rural areas. Actions include issuing grants to rural communities, bolstering rural workforce capacity, improving access to high-speed internet, and supporting access to rural maternal and behavioral health care.
  • GAO Releases Report on Public Health Preparedness. In the report, the US Government Accountability Office (GAO) describes the Centers for Disease Control and Prevention’s awards to support jurisdictions’ public health infrastructure for preparedness, and examines challenges to building and maintaining such infrastructure, as identified by selected jurisdictions and stakeholder groups.
  • Senate Confirms Dr. Monica Bertagnolli as NIH Director. Dr. Bertagnolli was confirmed by a 62–36 vote, with Sen. Sanders (I-VT) and Sen. Fetterman (D-PA), along with 34 Republicans, voting against her.


Healthcare activity is expected at the committee level next week, including a Senate Finance Health Subcommittee hearing on telehealth and a potential House Energy & Commerce Committee markup on healthcare legislation. Congress will continue work to avert a government shutdown as the November 17 funding deadline is fast approaching at the end of next week.

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

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