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House Subcommittee Holds Hearing to Review 340B Legislation

July 13, 2018—The House Energy and Commerce Health Subcommittee held a July 11 hearing on the 340B Drug Pricing Program. The hearing included a review of a recent Government Accountability Office (GAO) report on contract pharmacy arrangements, as well as an examination of 13 legislative proposals that would impact the program.

The AAMC submitted a statement to the subcommittee supporting the 340B program and two bills that would strengthen the program:

  • A bill (H.R. 4392) introduced by Reps. David McKinley (R-W.Va.) and Mike Thompson (D-Calif.), with nearly 200 bipartisan cosponsors, that would reverse the $1.6 billion annual cut in Medicare reimbursements to 340B hospitals in the calendar year 2018 outpatient final rule issued by the Centers for Medicare and Medicaid Services (CMS) last year, and
  • The Stretching Entity Resources for Vulnerable Communities Act (SERV Act, H.R. 6071) introduced by Rep. Doris Matsui (D-Calif.), which, in addition to rescinding these cuts, would clarify the intent of the program and improve program integrity to ensure that all program participants are held to the same oversight standards.

Additionally, the AAMC expressed concern about a variety of legislative proposals that seek to reduce the scope of the program, which could result in less access to critical services for low-income patients. Specifically, the association is concerned about provisions related to creating a moratorium on hospital participation, imposing additional reporting requirements on covered entities, changing the definition of an eligible patient, creating new eligibility thresholds, and imposing user fees on 340B hospitals.

During the first panel of the hearing, GAO Health Care Director Debra Draper, PhD, provided an overview of the June 28 report on contract pharmacy arrangements [see Washington Highlights, June 29]. Draper’s testimony included seven recommendations to increase oversight by the Health Resources and Services Administration (HRSA), three of which the agency did not concur with because they are overly burdensome.

The second panel featured testimony from Parkland Health and Hospital System President and CEO Frederick Cerise, MD; University of California San Diego (UCSD) Pharmacist-in-Chief and Associate Dean Charles Daniels, BS Pharm, PhD; and Texas Oncology Executive Vice President Debra Patt, MD, MPH, MBA. Cerise and Daniels both focused on how their institutions rely on the savings from the 340B program to support low-income patients in their communities. Cerise noted that in addition to using 340B savings to administer free or reduced-cost medicines to low-income patients, the program allows Parkland to invest in other programs, including diabetes management, pediatric asthma programs, and smoking cessation programs. Daniels highlighted that UCSD uses its savings to offer primary and specialty services at an HIV/AIDS clinic, as well as a program for staff to counsel patients at their bedsides before being discharged on how to take their medications appropriately and improve their health outcomes.

In his opening statement, Subcommittee Chair Michael Burgess, MD, (R-Texas) stated that the 340B program “enjoys strong bipartisan support as it helps many health care providers provide care to vulnerable Americans.” He added that the hearing “is an opportunity to engage in a dialogue and exchange ideas about what might be the best way to move forward with improving the accountability and transparency of the 340B program.”


Jason Kleinman
Sr. Legislative Analyst, Govt. Relations
Telephone: 202-903-0806


CMS Issues Proposed Physician Fee Schedule (MPFS) and Quality Payment Program (QPP) Rule for 2019

July 13, 2018—The Centers for Medicare and Medicaid Services (CMS) proposed historic changes to the evaluation and management code documentation and payment in a proposed rule released July 12, 2018. This rule will update payment rates and policies for services provided by physicians and other clinicians to Medicare beneficiaries in 2019. The rule also proposes changes to the QPP, which consists of two participation pathways — merit-based incentive payment system (MIPS), which measures performance based on four categories, and advanced alternative payment models (APMs) in which clinicians may earn incentive payments based on sufficient participation in models. The AAMC will analyze the proposed rule in more detail in the coming weeks and will be submitting comments by the September 10, 2018, deadline.

Key highlights in the MPFS include proposing:

  • A 2019 MPFS conversion factor of $36.05, a slight increase from the 2018 conversion factor of $35.99
  • Streamlining "evaluation and management" (E&M) documentation guidelines by allowing clinicians to choose to document E&M visits using medical decision-making or time, or alternatively continue to use the current framework

  • Single, blended payment rates for new and established office or outpatient visits level two to five and add-on codes to reflect additional resources

  • Allowing practitioners to focus their documentation on what has changed since the last visit, rather than redocumenting information in the history and exam

  • Allowing practitioners to review and verify certain information in the medical record that is entered by ancillary staff or the beneficiary rather than re-entering it 

  • Paying separately for newly defined physician services furnished using communication technology, such as paying for virtual checkups by phone or video chats with physicians

  • Creation of a bundled episode of care for management and counseling treatment for substance use disorder

  • Maintaining the relativity adjuster of 40% for payments of items and services provided in certain off-campus hospital outpatient provider-based departments

  • Creation and payment for two new codes to describe physician consultative services:

    • CPT 994X0 interprofessional telephone/internet/electronic health record referral service(s) provided by a treating/requesting physician or qualified health care professional, 30 minutes

    • 994X6 interprofessional telephone/internet/electronic health record assessment and management service provided by a consultative physician including a written report to the patient’s treating/requesting physician or other qualified health care professional, 5 or more minutes of medical consultative time

  • Reducing drug payment add-on for wholesale acquisition cost-based payments for new Part B drugs from 6% to 3%

  • Reducing total number of measures in the Medicare Shared Savings Program quality measure set from 31 to 24 measures and focusing the measures on outcomes-based measures

  • Requiring hospitals to make public a list of their standard charges

A CMS fact sheet on the MPFS proposed rule is available here.

Key highlights in the QPP include proposing:

  • A 15% weight for the cost performance category, an increase from the 10% weight in 2018

  • Expanding the definition of MIPS-eligible clinicians to include new clinician types (physical therapists, occupational therapists, qualified speech-language pathologists, certified nurse-midwives, qualified audiologists, clinical social workers, clinical psychologists, registered dieticians or nutrition professionals)

  • Adding a third element, number of covered professional services, to the low-volume threshold determination, and providing an opt-in policy that offers eligible clinicians who meet or exceed at least one element of the low-volume threshold the ability to participate in MIPS

  • Providing the option to use facility-based scoring for facility-based clinicians

  • Modifying the MIPS Promoting Interoperability performance category to align with the proposed new Promoting Interoperability Program requirements for hospitals

  • Streamlining the definition of a MIPS-comparable measure in both the advanced APM criteria and Other Payer Advanced APM criteria

  • Updating the MIPS APM measure sets that apply for purposes of the APM scoring standard

  • Increasing flexibility for the All-Payer Combination Option and Other Payer Advanced APMs for non-Medicare payers to participate in QPP

  • Updating the Advanced APM certified EHR technology (CEHRT) threshold so that an advanced APM must require at least 75% of eligible clinicians in each APM entity use CEHRT

  • Extending the 8% revenue-based nominal standard for advanced APMs through performance year 2024

A CMS fact sheet on the Qualify Payment Program proposed rule is available here.


Gayle Lee
Director, Physician Payment & Quality
Telephone: 202-741-6429

Kate Ogden
Physician Payment & Quality Specialist
Telephone: 202-540-5413


AAMC, AAU, APLU, COGR Submit Letter to EPA Opposing Proposed Rule on Scientific Research

July 13, 2018—The AAMC July 11 submitted a joint letter  with the Association of American Universities (AAU), the Association of Public and Land-grant Universities (APLU), and the Council on Governmental Relations (COGR) to the Environmental Protection Agency (EPA) strongly opposing a proposed rule that seeks to limit the science the agency could consider in rulemaking on research for which all underlying data are publicly available. The associations express concern that the proposed rule “thwarts the promise of evidence-based policymaking, squarely contradicting the requirement that the EPA use the ‘best available science’ to make its regulatory decisions.”

Recognizing that the mechanisms of competitive grant funding and peer review of publications serve to ensure the validity of science and integrity of research even when the data are not available to the public, the letter urges that the agency to withdraw the proposed rule and discuss with the scientific community how evidence-based policy should be developed to protect human health and the environment. The letter assets that “the trend toward data transparency championed by the Associations and by foundations and science agencies around the world is predicated on the view that peer-reviewed, published studies already have presumptive scientific merit.”

EPA extended the comment period on this proposal until August 17, and it will hold a public hearing on July 17 to obtain additional stakeholder input on the proposal. 


Heather Pierce, JD, MPH
Sr. Director, Science Policy & Regulatory Counsel
Telephone: 202-478-9926


House Appropriations Committee Approves Labor-HHS Bill

July 13, 2018—In a markup spanning over 12 hours, the House Appropriations Committee July 11 amended and approved its FY 2019 Labor-HHS-Education spending bill by a party line vote of 30-22.

The committee adopted 18 amendments to the subcommittee-passed bill [see Washington Highlights, June 15], the majority of which related to the separation of immigrant families at the US border. Also among the adopted amendments was a Manager’s Amendment offered by Labor-HHS-Education Appropriations Subcommittee Chair Tom Cole (R-Okla.), which makes “technical and non-controversial changes to the bill and report,” and was approved by voice vote. 

The updated bill maintains the subcommittee-approved funding level of $38.3 billion for the National Institutes of Health (NIH) in FY 2019, reflecting a $1.25 billion (3.4 percent) increase over the comparable FY 2018 funding level. In both the subcommittee and full committee hearings, Chairman Cole noted his view that Congress needs to build upon the $3 billion increase for NIH in FY 2018, and emphasized that he views the House committee’s spending bill “as a floor, not a ceiling for biomedical funding.” He also indicated that he is “hopeful this number can increase as the process moves forward.”

As in previous sessions, Labor-HHS Subcommittee Ranking Member Rosa DeLauro (D-Conn.) again commented that the Labor-HHS bill should have received a proportional increase of $5.5 billion for its FY 2019 allocation rather than the flat-funding it received. As a result, she noted that “more than 20 of NIH’s institutes will receive an increase of only 1.2 percent … That is less than inflation.”

Also maintained in the committee-approved Labor-HHS bill is a new $200 million for Graduate Medical Education (GME) through the Health Resources and Services Administration (HRSA). The HRSA Title VII and Title VIII health professions programs remain largely flat-funded, with the notable exception of the House elimination of the diversity pipeline program, the Health Career Opportunity Program (HCOP).

The committee did, however, adopt new report language expressing support for “the efforts of the National Academies of Sciences, Engineering, and Medicine to explore the factors that contribute to the low participation of Black men in the medical profession” and requiring HHS to submit an action plan “to address the increasing underrepresentation of Black men in medical schools and in the medical profession.”

The adopted amendments also include an additional $2 million to the Substance Abuse and Mental Health Services Administration (SAMHSA) for medical provider education on opioid treatment ($24 million instead of the $22 million in the subcommittee-approved bill), and new report language directing the Centers for Medicare and Medicaid Services (CMS) to issue a report within four months of the bill’s enactment, outlining “price changes of prescription drugs [net of rebates] since 2008.”

The committee rejected 31 additional amendments on a variety of issues, including an amendment offered by Rep. Mark Pocan (D-Wis.), and supported by Rep. DeLauro and Rep. Debbie Wasserman-Schultz (D-Fla.), that would have stricken the bill’s prohibition on research with fetal tissue.

The Senate Appropriations Committee approved its version of the Labor-HHS bill June 28 [see Washington Highlights June 29]. In contrast to the House-passed bill, the Senate’s bipartisan bill includes a $2 billion increase for NIH and maintains HCOP funding in FY 2019.

The Senate is expected to take up its Labor-HHS bill on the Senate floor – for the first time since 2007 – potentially as soon as the week of July 30.


Tannaz Rasouli
Sr. Director, Public Policy & Strategic Outreach
Telephone: 202-828-0525

Matthew Shick, JD
Director, Gov't Relations & Regulatory Affairs
Telephone: 202-862-6116

Christa Wagner
Legislative Analyst
Telephone: 202-828-0595


House Energy and Commerce Committee Votes on Key Workforce Diversity Legislation

July 13, 2018—The House Energy and Commerce Committee July 12 voted to move workforce legislation to the House floor.  Both the Educating Medical Professionals and Optimizing Workforce Efficiency and Readiness Act of 2017 (EMPOWER) Act (H.R. 3728) and Children’s Hospital GME Support Reauthorization Act (H.R.5385) were among the approved bills [see Washington Highlights, June 29].

An amendment to the EMPOWER Act was submitted by Health Subcommittee Chair Michael Burgess (R-Tex.) and Rep. Jan Schakowsky (D-IL), which would increase funding for the Primary Care Training and Enhancement Title VII programs to $48,924,000 and also increase the salary amount of Geriatric Academic Career Awards from $76,000 to $100,000. Dr. Burgess voiced his support of these awards to “more effectively attract and support the geriatrics faculty.”  Rep. Schakowsky echoed the importance of the geriatric workforce programs in her statements.

On July 11, the AAMC sent a letter to Chairman Greg Walden (R-Ore.) and Ranking Member Frank Pallone (D-NJ) thanking them for their “efforts to reauthorize the Title VII programs” while also continuing to “urge appropriators to provide at least $424 million for the Title VII programs in FY 2019.” The letter highlighted the importance of the CHGME and Title VII programs in combating projected physician workforce shortages.

A vote on the legislation by the full Congress has not been scheduled.


Matthew Shick, JD
Director, Gov't Relations & Regulatory Affairs
Telephone: 202-828-0525

Shamaal Sheppard
Intern, Government Relations
Telephone: 202-478-9924


Office for Human Research Protections Hosts Public Meeting on Revised Common Rule

July 13, 2018—The Department of Health and Human Services’ (HHS) Secretary’s Advisory Committee on Human Research Protections (SACHRP) July 10-11 held a public meeting to discuss the recent revisions to the Federal Policy for the Protection of Human Subjects (“Common Rule”) that institutions, researchers, and Institutional Review Boards (IRBs) must implement before the January 21, 2019 compliance date. The regulations are scheduled to go into effect July 19, 2018.

SACHRP discussed several topics related to the revised regulations, such as recommendations for the revised expedited review list and appropriate compensation for research subject participation and dedicated significant time to the committee’s draft commentary on the new requirements for informed consent, which were described by Stephen Rosenfeld, MD, SACHRP chair, as “one of the most important products of the final rule.” This further underscores the statement by Jerry Menikoff, MD, PhD, HHS Director of the Office for Human Research Protections (OHRP), in the agency’s press release announcing the Common Rule revisions, “[w]e are very hopeful that these changes [to informed consent] and all the others that reduce unnecessary administrative burdens will be beneficial to both researchers and research participants.” On September 7, OHRP will host its first workshop on the revised Common Rule, “Meeting New Challenges in Informed Consent in Clinical Research.”

The committee also discussed implementation of the transition provisions and the three “burden reducing” provisions regulated entities may voluntarily adopt on July 19, approximately six months before the January 21, 2019 compliance date [see Washington Highlights, June 22]. SACHRP intended to discuss draft guidance on implementing these optional burden reducing provisions but removed this discussion from the agenda since the guidance was not cleared for public release by federal officials and it is still uncertain when such guidance will be issued.

The AAMC will continue to monitor developments related to the revised Common Rule and post updates on the association's Common Rule webpage, which currently includes an opportunity to provide feedback on the kind of resources and tools that would be most helpful during the implementation process.


Heather Pierce, JD, MPH
Sr. Director, Science Policy & Regulatory Counsel
Telephone: 202-478-9926

Daria C. Grayer, JD, MA
SA- Lead Specialist, Science Policy and Regulation
Telephone: 202-741-5474


On the Agenda

July 17: Senate HELP Hearing on Reducing Health Care Costs
10 a.m., 430 Dirksen Senate Office Building, Washington D.C.
The Senate Health, Education, Labor, and Pensions Committee will hold a full committee hearing titled “Reducing Health Care Costs: Eliminating Excess Health Care Spending and Improving Quality and Value for Patients.”

July 17: House Energy and Commerce Hearing on Transparency
10:15 a.m., 2322 Rayburn House Office Building, Washington D.C.
The House Energy and Commerce Subcommittee on Oversight and Investigations will hold a hearing entitled “Examining State Efforts to Improve Transparency of Health Care Costs for Consumers.”

July 17: House Ways and Means Hearing on Transition from Volume to Value in Medicare
2 p.m., 1100 Longworth House Office Building, Washington D.C.
The House Ways and Means Health Subcommittee will hold a hearing on “Modernizing Stark Law to Ensure the Successful Transition from Volume to Value in the Medicare Program.” This hearing will examine possible solutions for the “Stark Law” on physician self-referral to improve the Medicare program by successfully moving to a value-based system. 

July 18: Senate HSGA Hearing on Government Reorganization Proposal
10 a.m., SD-342, Dirksen Senate Office Building, Washington D.C.
The Senate Committee on Homeland Security and Governmental Affairs will hold a full committee hearing titled “Reviewing the Administration’s Government Reorganization Proposal.”

July 19: House Energy and Commerce Hearing on Mental Health Initiatives
10 a.m., 2123 Rayburn House Office Building, Washington D.C. 
The House Energy and Commerce Subcommittee on Health will hold a hearing entitled “21st Century Cures Implementation: Examining Mental Health Initiatives.” 

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Jason Kleinman
Sr. Legislative Analyst, Govt. Relations
Telephone: 202-903-0806