McDermottPlus Check-Up: October 30, 2020 - McDermott+Consulting

McDermottPlus Check-Up: October 30, 2020

This Week’s Dose

Despite being only a few days away from the election, it was a busy week in healthcare. The Administration issued four healthcare-related rules to address coverage of a future coronavirus (COVID-19) vaccine, transparency in pricing for insurance plans, delay of information blocking and interoperability requirements, and coverage and payment for durable medical equipment. In addition, the Senate confirmed Amy Coney Barrett to the US Supreme Court, setting the stage for a hearing on the validity of the Affordable Care Act (ACA).

Election Day is around the corner. Join McDermott lawyers and our policy and lobbying team for a post-election webinar on November 5, 2020, at 12:00 PM EST where we will consider how the results will impact the healthcare industry and others in 2021 and beyond.


CMS Issued COVID-19 IFC. As the fourth interim final rule with comment (IFC) issued by the Centers for Medicare and Medicaid Services (CMS) during the public health emergency (PHE), this rule addresses access to and payment for COVID-19 treatments. Under the rule, any future COVID-19 vaccine approved by the Food and Drug Administration will generally be provided at no cost to beneficiaries enrolled in Medicare, Medicare Advantage, Medicaid (only during the PHE) and most private insurance. In addition, Medicare is setting the reimbursement rate and providing add-on payments for hospitals treating COVID-19 patients with new products under certain circumstances. Finally, CMS continues implementing transparency provisions by requiring any provider who performs a COVID-19 diagnostic test to post their cash prices online. The changes in the IFC are effective upon publication in the Federal Register and applicable until the end of the PHE. More information is available in the CMS fact sheet.

CMS Finalized Transparency in Coverage Rule. The final rule, which flows from President Trump’s executive order on Improving Price and Quality Transparency in American Healthcare to Put Patients First, requires most group health plans and health insurance issuers in the group and individual market to make pricing information public, including their in-network negotiated rates and historical out-of-network allowed amounts. Most insurers will be required to provide beneficiaries with personalized price information for an initial list of 500 “shoppable” services for plan years that begin on or after January 1, 2023, and for the remainder of all items and services for plan years that begin on or after January 1, 2024, a phased-in approach that differs from the proposed rule. In addition, plans will be required to post three machine-readable files that include in-network negotiated rates for all covered items and services, the historical out-of-network charges and payments, and in-network negotiated rates and historical net prices for all covered prescription drugs, respectively (the proposed rule originally included drug prices within the in-network rate file). Finally, health plans that encourage consumers to shop for lower cost services, and that share the savings with consumers, can take credit for such “shared savings” payments in their medical loss ratio calculations. The rule does not apply to grandfathered health plans, excepted benefits plans, healthcare sharing ministries and short-term limited duration insurance plans. More information is available in the CMS fact sheet. Insurers are largely opposed to the rule, and the delayed implementation timeline provides stakeholders with additional time to lobby for changes.

HHS Delayed Information Blocking Requirements. The Department of Health and Human Services (HHS) Office of the National Coordinator for Health IT (ONC) released an IFC that extends the timeline for compliance with the information blocking and interoperability requirements of ONC’s Cures Act Final Rule. The final rule, which was released in March 2020, established exceptions to the 21st Century Cures Act’s information blocking provision and adopted new health information technology certification requirements to increase patients’ access to their health information using application programming interfaces. ONC states that it is delaying the compliance timeline in response to the pandemic. The compliance timeline will now begin April 5, 2021, (see Table 1 beginning on page nine here for a list of all dates).

CMS Issued DMEPOS Proposed Rule. The rule makes changes to Medicare Durable Medical Equipment, Prosthetics, Orthotic Devices and Supplies (DMEPOS) coverage and payment policies. If finalized, the proposed rule would apply to items furnished on or after April 1, 2021, or the date immediately following the PHE. With this rule, CMS proposes to continue paying suppliers higher rates for furnishing items and services in rural and non-contiguous areas as compared to items and services furnished in other areas. The rule also makes changes to certain Medicare coding procedures and proposes to classify all continuous glucose monitors as Durable Medical Equipment (DME). Finally, the rule addresses classifications of external infusion pumps as DME as they relate to “appropriate for home use” and the exclusion of complex rehabilitative manual wheelchairs and certain other manual wheelchairs from the DMEPOS Competitive Bidding Program. CMS will accept comments on the proposed rule for 60 days after publication in the Federal Register.

HHS Updated PRF Guidance. The updated frequently asked questions document (FAQ) includes more details on the allowable uses of the Provider Relief Fund (PRF), including that the funds may be used for COVID-19 vaccine distributions, and a change in the date by which PRF funds must be used from July 31, 2021, to June 30, 2021. The FAQ also clarifies that subsidiaries may transfer funds received through the General Distribution to their parent organization, even if the subsidiary already attested to the terms and conditions. Finally, the FAQ includes additional information on calculating lost revenues. Providers should continue to examine how the revisions impact their specific organization and monitor the HHS website for additional guidance.


Amy Coney Barrett Confirmed to US Supreme Court. The Senate voted 52 to 48 to confirm Barrett’s nomination, with Senator Susan Collins (R-ME) joining Democrats to vote no. Democrats unanimously opposed the nomination, which came just weeks before Election Day, significantly heightening the makeup of the Court as a political issue. Barrett will now be seated in time to hear arguments in the case challenging the constitutionality of the Affordable Care Act’s (ACA) individual mandate on November 10. McDermottPlus put together this review of potential scenarios for the Supreme Court’s review of the ACA.

Quick Hits

  • A bipartisan group of 54 House lawmakers sent a letter calling on HHS to clarify federal guidance barring out-of-pocket costs for COVID-19 testing.
  • Bipartisan leadership of the Senate Finance Committee sent a letter asking HHS to release details of its oversight of organ procurement organizations. The Committee began an investigation of the nation’s transplant system earlier this year.
  • HHS announced the first of five rounds of PRF incentive payments for nursing homes totaling approximately $333 million. This incentive program was initially announced in September.
  • HHS released data showing that 62% of hospitals are meeting newly imposed data reporting requirements. Hospitals that fail to comply face termination from Medicare and Medicaid.

M+ Resources

  • In honor of Halloween tomorrow, we take a very scary look at the nightmare scenario we could face on Election Night on this week’s episode of the Health Policy Breakroom.
  • With four days to go until Election Day, it appears likely that Democrats will keep the House; the question is by what margin. This +Insight explores why the margin of control matters.
  • Follow our Special Election Coverage page for all our analysis related to the election and its health policy implications.

Next Week’s Diagnosis

Election Day 2020 is almost here. Join McDermott lawyers and our policy and lobbying team for a post-election webinar on November 5, 2020, at 12:00 PM EST where we will consider how the results will impact the healthcare industry and others in 2021 and beyond.

For more information, contact Mara McDermottKristen O’BrienRachel StaufferEmma Zimmerman or Katie Waldo.

To subscribe to the McDermottPlus Check-Up, please contact Jennifer Randles.