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Federal Regulatory, Legislative and Reimbursement Report – January-February 2015

Regulatory Update


  • Federal Poverty Guidelines Update
    • CMS recently released an informational bulletin regarding the 2015 updates to the federal poverty guidelines. By law, these updates are applied to eligibility criterion for programs such as Medicaid and the Children’s Health Insurance Program (CHIP). The 2015 Dual Eligible Standards have also been updated based on the percentage of Federal Poverty Level.
  • Managing Dementia-Related Behaviors – Non-drug Approaches
    • Since CMS initiated its campaign in early 2012 to reduce the prevalence of antipsychotic drug use in the elderly nursing home population, much has been written and said about the drugs limited utility, the need to use them only when clinically indicated, the need for close monitoring for effectiveness and emergence of adverse consequences, and the need of attempting periodic dose reductions.
    • Another equally important aspect of antipsychotic drug use, but one more likely to be neglected, is the need to utilize behavioral (aka, non-drug) interventions to manage the distressed behaviors of dementia. Indeed, non-drug interventions are considered to be “first-line therapy” for this condition.  Thus, CMS mandates that non-drug interventions are to be attempted prior to resorting to medication.  Moreover, if a nursing home resident is ultimately treated with an antipsychotic drug, the resident should also receive non-drug interventions as well in an effort to reduce drug use unless deemed to be clinically contraindicated.  In addition, the facility’s effort to attempt or utilize non-drug interventions should be clearly documented in the resident’s clinical record.
    • For more, click here.
  • Use of Antipsychotics Reduced Nationally by 19.4% Since 2012
    • The continued efforts of long-term care clinicians, including consultant pharmacists, to reduce the use of antipsychotic medications for the treatment of dementia has resulted in a national reduction rate of 19.4% since the initiative began in 2012. At the end of 2011, the national usage rate of antipsychotics stood at 23.9%. In the third quarter of 2014, the total overall national usage rate was 19.2%, with many states at much lower usage rates. Hawaii continues to have the lowest rate of use (8.70%), with Michigan (13.33%), Wisconsin (14.23%), New Jersey (14.26%), and Washington, D.C. (14.72%) rounding out the top five places. The state that has achieved the most substantial drop in usage is Delaware, which reduced antipsychotic medication use from 30.4% to 14.8%. Center for Medicare & Medicaid Services has set new reduction goals of 25% by the end of 2015, and 30% by the end of 2016.
    • ASCP supports the work of the National Partnership to Improve Dementia Care in Nursing Homes, which is working toward a reduction in the use of antipsychotics. The Society has sponsored a series of Webinars to educate long-term care clinicians on effective strategies to reduce antipsychotic medication use while providing comprehensive, person-centered clinical care.
  • GAO Releases Report on Antipsychotic Use by Seniors in the Community
    • In an acknowledgement of the progress that has been made reducing the use of antipsychotic medications in nursing facilities, the Government Accountability Office (GAO) now recommends the Department of Health and Human Services expand these reduction efforts to seniors living in the community. The GAO report, entitled “Antipsychotic Use: HHS Has Initiatives to Reduce Use Among Older Adults in Nursing Homes, but Should Expand Efforts to Other Settings,” indicates that about 14% of community-dwelling seniors, including those in assisted living facilities, are prescribed these medications for behaviors related to dementia despite a black box warning for this indication. The expanded focus to community-dwelling seniors presents an excellent opportunity for ASCP members to bring their robust senior care pharmacy skills to this sector, just as they have successfully done so in skilled nursing facilities.
  • CMS Requests Corrective Action Plan From Aetna
    • The Centers for Medicare & Medicaid Services has requested that Aetna institute a Corrective Action Plan for failing to comply with its statutory obligation to invite and allow participation of any willing pharmacy in the standard pharmacy network of its Part D plans. CMS said the focus of the CAP must be to bring the insurer into compliance with any willing pharmacy requirements as soon as possible for the 2015 plan year and that the insurer also would be expected to comply for the 2016 plan year.
    • Specifically, CMS clarified that the CAP must include a set of network pharmacy standard terms and conditions for all of Aetna’s 2015 Part D plans that include a provision clearly identifying the plan(s) to which the terms and conditions apply. In the event that Aetna does not demonstrate timely compliance, CMS also indicated that it reserves the right to impose additional enforcement actions, such as suspending marketing and enrollment, imposing a monetary fine, or the issuance of a contract termination notice.
  • Medicare to Ban LTC Prorated Short-Cycle Dispensing Fees
    • Medicare Part D prescription drug plans will not be allowed to pay long-term care pharmacies prorated dispensing fees for short-cycle prescriptions starting in the 2016 plan year. The ban came in response to long-standing NCPA concerns. The announcement was made last week by the Centers for Medicare & Medicaid Services. Click here for more.
  • December Enrollment Data Released by CMS
    • December 2104 enrollment data for the CHIP and Medicaid programs can be viewed here.
  • CMS Updates 2015 Income Limits for Dual Eligible Patients
    • CMS published its annual update to monthly income limits for patients qualifying for dual eligible status, as well as Medicare Savings Program participation.
  • 2013 Medicaid DUR Report Posted
    • States are required to report annually on its prescribing habits, cost savings generated from DUR programs and program’s operations, including adoption of new innovative DUR practices via the Medicaid Drug Utilization Review Annual Report Survey.

Legislative Update

  • S. Rep. Guthrie Again Leads The Way In Introducing Federal Pharmacist Provider Status Legislation
    • On Jan. 28, 2015, new federal pharmacist provider status legislation was reintroduced in the House of Representatives. The bill, introduced by Reps. Brett Guthrie (R-KY), G.K. Butterfield (D-NC), Todd Young (R-IN), and Ron Kind (D-WI), is called the Pharmacy and Medically Underserved Areas Enhancement Act – H.R. 592.
    • Similar to 2014’s, H.R. 4190, the provisions will provide access to pharmacist-provided clinical services to patients in medically underserved communities. This bill and its forthcoming companion bill in the Senate is the key priority for the Patient Access to Pharmacists’ Care Coalition (PAPCC), which YOUR Kentucky Pharmacists Association supports and participates in through the National Alliance of State Pharmacy Associations.
    • Click here to view the press release from the American Pharmacists Association.
    • Kentucky had all but one representative signed on as a cosponsor of the 2014 bill. Contact your representative NOW and ask him to support HR 592!
  • Bill Introduced in Senate to Ensure Preservation of Six Protected Classes
    • On March 4, 2015, Senator Grassley (R-IA) along with Senator Brown (D-OH) introduced legislation to ensure six classes of medications (antipsychotics, anticonvulsants, antineoplastics, antidepressants, antiretrovirals and immunosuppressants) currently “protected” under Medicare Part D are able to permanently maintain this status. The “protected” status these six classes currently enjoy requires Medicare Part D Prescription Drug Plans (PDP’s) to cover all or substantially all of the medications on their formularies so Part D beneficiaries have access to any of them.
    • The new bill, S. 648, will write into statue the permanent protection of these six classes of medications. This legislative initiative comes about a year after the Centers for Medicare and Medicaid Services (CMS) issued their 2015 Medicare Part D Proposed Rule, which, if finalized, would have removed three of the six protected classes. While this provision of the rule was ultimately not finalized, largely because of the public and Congressional outcry, there was still concern CMS would promulgate this in future rulemaking.
  • Pharmacy ‘Lock-in’ Mustn’t Lock Out Independents
    • Buried in a 393-page draft House bill with the laudable goal of accelerating the “discovery, development, and delivery of promising new treatments” for diseases is a provision that would restrict certain Medicare beneficiaries to use only a dedicated, “lock-in” pharmacy to fill their controlled substance prescriptions. The stated purpose is to reduce the potential for drug abuse and fraud.
  • Bill Introduced to Expand MTM in Medicare
    • A bipartisan group of Senators introduced Senate bill 776, which would provide Medicare access to medication therapy management services to Medicare enrollees if they have been diagnosed with diabetes, COPD, cardiovascular disease or elevated cholesterol. The bill’s sponsors are Senators Roberts (R-KS), Brown (D-OH), Shaheen (D-NH) and Kirk (R-IL). The bill has been referred to the Senate Finance Committee for consideration.
  • Protecting the Integrity of Medicare Act Passed by House Committee
    • The U.S. House of Representatives Committee on Ways and Means passed the Protecting the Integrity of Medicare Act (PIMA) of 2015 (H.R. 1021). The bill includes changes in the requirements for surety bonds for home health agencies.
    • Please click here for more information.
  • Any Willing Pharmacy Bill Reintroduced in the House
    • On February 5, Morgan Griffith (R-VA) and Peter Welch (D-VT) reintroduced the Ensuring Seniors Access to Local Pharmacies Act, HR 793, (the “any willing pharmacy” bill) in the House. It is identical to HR 4577 in the previous congressional session. This bill would amend the Social Security Act to require PDPs to consider any willing pharmacy for that plan’s preferred network within a medically underserved area, as defined by the Health Resources and Services Administration. At the end of the last Congress, there were 80 bipartisan cosponsors, and ASCP fully expects most of those members to sign on again in support of the bill. There is currently no Senate companion bill, but ASCP will keep the membership informed as this bill advances through legislative process.


  • Why is FDA Dropping the Ball on Superbug?
    • UCLA Medical Center notified 179 patients that it had potentially exposed them to a fearsome “superbug,” and urged them to get tested.
    • The hospital accidentally infected seven people in procedures involving specialized endoscopes, called duodenoscopes, that proved difficult to thoroughly clean. Two of the people died.
    • The “superbug” at issue — carbapenem-resistant Enterobacteriaceae, or CRE – is the latest and most difficult to treat in a series of superbugs that includes MRSA and VRE. Such bacteria are the Frankensteinian result of our misusing antibiotics over many decades, and beating them back will require the kind of surveillance and coordination that might have prevented them in the first place.
    • For more, click here.
  • White House Issues Plan To Reduce Antibiotic Resistance
    • The Obama administration released a plan developed by representatives from federal agencies to reduce antibiotic resistance, which the CDC says leads to 23,000 deaths each year. The plan sets goal markers over a five-year period, and calls for a 50 percent decrease in inappropriate use of antibiotics in outpatient settings and a 20 percent decrease for inpatient facilities.
    • For more, click here.
  • FDA Issues New Draft Documents Related To Compounding Of Human Drugs
    • S. Food and Drug Administration issued five draft documents related to drug compounding and repackaging that will help entities comply with important public health provisions. The draft documents are applicable to pharmacies, federal facilities, outsourcing facilities and physicians.
    • The new category of outsourcing facilities was created under the Drug Quality and Security Act (DQSA), enacted by Congress in November 2013 in response to a deadly fungal meningitis outbreak that was linked to contaminated sterile compounded drug products. Drugs compounded in an outsourcing facility that meet certain conditions may be entitled to exemptions from certain provisions of the Federal Food, Drug, and Cosmetic Act (FD&C Act), including the new drug approval requirements and the requirement to label drug products with adequate directions for use. Outsourcing facilities are subject to current good manufacturing practice requirements and inspections by the FDA according to a risk-based schedule.
    • For more, click here.


  • The Story Behind Rx Price Increases
    • The Wall Street Journal Pharmalot blog gives some insight on recently reported drug price spikes: not all increases are created equal. While the combined brand/generic price increase for 2014 was 10.9%, drugs for chronic obstructive pulmonary disease and topical anti-inflammatory drugs jumped 23% and 26%, respectively. Industry sources say price increases are a natural response to government and pharmacy benefit management demands for higher rebates.

Administration on Aging

  • State Long-Term Care Ombudsman Program Final Rule Issues by Administration on Aging
    • The Administration on Aging (AoA) recently published a final rule intended to create more national consistency for the State Long-Term Care Ombudsman Program.
    • Please click here for more information.

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