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Federal Regulatory, Legislative and Reimbursement Report – March-April 2015

Regulatory Update


  • CY2016 Final Rate Announcement and Call Letter
    • CMS released the final 2016 Rate Announcement and Call Letter. Although the Call Letter did not contain any surprises, the pharmacy community is encouraged that CMS shares our concern over important issues such as medication therapy management, the adequacy of PDP pharmacy networks and the accuracy of the PDP network listings. Areas of interest in the document include the CMR completion rate as a component of the plan Star Ratings, Audit & Oversight, and MAC Pricing. For more information, see the highlights document which also includes links to the Call Letter as well as a CMS Fact Sheet.
  • Medicare Fines Aetna $1 Million for Part D Compliance Failure
    • The Centers for Medicare & Medicaid Services has fined Aetna $1 million for potentially misleading Medicare Part D beneficiaries, creating confusion and disrupting the marketplace during the 2015 Annual Election Period.
    • The snafu unfolded last year when Aetna erroneously listed nearly 7,000 pharmacies as “retail in-network” for the 2015 plan year. After January 1, many enrollees presenting prescriptions at their usual pharmacy found that it was not in the plan’s network. Weeks before then, NCPA, working with other independent pharmacy stakeholders, had alerted CMS and Aetna that problems were coming. NCPA and YOUR KPhA continued to collect incidents from pharmacies and pharmacy groups and sent them to CMS detailing reports of patients’ confusion and access difficulties. NCPA urged CMS to open a special enrollment period, which it did.
    • For more, click here.
  • CMS updates Medicare Claims Processing Manual for SNFs
    • Updates to the Medicare Internet-Only Manual Chapters for Skilled Nursing Facility (SNF) Providers are effective June 15, 2015.
    • For more, click here.
  • New Website: National Partnership to Improve Dementia Care
    • The Centers for Medicaid and Medicare services recently launched a new website for the National Partnership to Improve Dementia Care in Nursing Homes.
  • Medicare Advantage: Implications for Long-Term Service and Support Providers
    • The Centers for Medicare and Medicaid Services (CMS) released final program changes for Medicare Advantage (MA) Part C and Part D.
    • For more, click here.
  • CMS Releases First Ever Hospital Compare Star Ratings
    • The Centers for Medicare & Medicaid Services (CMS) for the first time introduced star ratings on Hospital Compare, the agency’s public information website, to make it easier for consumers to choose a hospital and understand the quality of care they deliver. Today’s announcement builds on a larger effort across HHS to build a health care system that delivers better care, spends health care dollars more wisely, and results in healthier people.
    • For more, click here.
  • CMS Implementation: Payroll-Based Staffing Data Collection for Nursing Homes
    • The Centers for Medicare and Medicaid Services distributed the following Informational Update on implementation of the ACA-mandated collection of payroll-based staffing data.
    • For more, click here.
  • CMS Clarifies Out Patient Therapy Requirements
    • In the S & C memo 15-33-OPT, the Centers for Medicare and Medicaid Services (CMS) clarifies requirements for off premise activities and approval of extension locations and added guidelines to the State Operations Manual (SOM) Chapter 2 for certification requirements for providers of Out Patient Therapies (OPTs).
    • For more, click here.
  • New Medicare Prescription Drug Cost Data Available
    • As part of the Administration’s goals of better, care, smarter spending, and healthier people, the Centers for Medicare & Medicaid Services announced the availability of new, privacy-protected data on Medicare Part D prescription drugs prescribed by physicians and other health care professionals in 2013. This data shows which prescription drugs were prescribed to Medicare Part D beneficiaries by which practitioners.
    • For more, click here.
  • 2016 Hospice Proposed Rule Calls For Service Intensity Add-On Payment for the Last 7 Days of Life
    • A major change in reimbursement was included in the fiscal year (FY) 2016 Medicare Hospice proposed rule. The proposed rule calls for Service Intensity Add-On (SIA) Payment for the last 7 days of life.
    • For more, click here.
  • CMS Finalizes 2016 Payment And Policy Updates For Medicare Health And Drug Plans
    • Rate Announcement Details Plan Payments and Other Program Updates for 2016
    • The Centers for Medicare & Medicaid Services (CMS) today released final Medicare Advantage (MA) and Part D Prescription Drug program changes for 2016 that provide fair and accurate payments to plans, and encourage the delivery of high-quality care for all populations.
    • For more, click here.


  • DEA Finalizes Rule on CS Prescription Drug Disposal
    • In September 2014, Drug Enforcement Administration (DEA) published its final rule, titled the Disposal of Controlled Substances, that allows some DEA registrants to modify their registration to become authorized collectors. Under the new rule, some DEA registrants, including retail pharmacies, hospitals/clinics with an on-site pharmacy, manufacturers, distributors, reverse distributors, and narcotic treatment programs, may modify their registration with DEA to become authorized collectors. The final rule implements the Secure and Responsible Drug Disposal Act of 2010, which authorized DEA to develop and implement regulations that would allow authorized entities other than law enforcement to collect unused and unwanted prescription drugs, including controlled substances (CS), for disposal purposes. Proper disposal of unused prescription medication is a key method of preventing and reducing prescription drug abuse. The final rule took effect on October 9, 2014.
    • The full rule is available on the Federal Register website here.

Legislative Update

  • Federal MAC Transparency Act of 2015
    • R. 244 is a bipartisan bill that would ensure federal health plan reimbursements to pharmacies keep pace with generic drug prices, many which skyrocket overnight. The MAC Transparency Act of 2015 was introduced by Representatives Doug Collins (R-GA-09) and Dave Loebsack (D-IA-02) on Jan. 9th, 2015.
    • For more, click here.
  • Congressional Committee Ready to Move on 21st Cures Bill
    • The House Energy and Commerce Committee looks ready to move ahead on the 21st Century Cures Act. The bill is primarily aimed at modernizing the drug and device approval process, but also contains a provision, apparently inserted at the urging of the pharmacy benefits management industry, to create a “lock-in program” for Medicare Part D enrollees who have been prescribed a controlled substance.
  • Information Regarding the Medicare Access and CHIP Reauthorization Act of 2015
    • Congress recently passed the Medicare Access and CHIP Reauthorization Act of 2015; the President is expected to sign it shortly. This law eliminates the negative update of 21% scheduled to take effect as of April 1, 2015, for the Medicare Physician Fee Schedule.   In addition, provisions allowing for exceptions to the therapy cap, add-on payments for ambulance services, payments for low volume hospitals, and payments for Medicare dependent hospitals that expired on April 1 have been extended.  CMS will immediately begin work to implement these provisions.
    • For more, click here.

Pharmacy Benefit Managers

  • United Healthcare To Buy Pharmacy Benefit Manager Amid Growing Concerns About Cutting-Edge Drug Costs
    • The nation’s largest insurer will acquire Catamaran Corp. for about $12.8 billion. Pharmacy benefit managers are viewed as a key element in efforts to negotiate the prescription drug prices paid by customers.
    • UnitedHealth’s deal to acquire Catamaran will bulk up its pharmacy-benefit business amid growing concern from employers and insurers about the rising costs of cutting-edge drugs. Catamaran, the fourth-largest pharmacy-benefit manager in the U.S. by volume of prescriptions processed, will be merged into UnitedHealth Group’s OptumRx unit, the industry’s third-largest and part of the company’s Optum health-services arm.
    • For more, click here.


  • FDA Launches Mobile App To Track Drug Shortages
    • The U.S. Food and Drug Administration launched the agency’s first mobile application (app) specifically designed to speed public access to valuable information about drug shortages.
    • The app identifies current drug shortages, resolved shortages and discontinuations of drug products.
    • For more, click here.
  • Compound Pharmacies Complain FDA Is Compounding Their Problems
    • As far as compounding pharmacies are concerned, the FDA is compounding their problems.
    • After a fungal meningitis outbreak that claimed 64 lives two years ago was traced to a compounding pharmacy, the agency has been cracking down. Dozens of compounders have been inspected, and some were issued warning letters for poor practices. In a few instances, the FDA urged the public to avoid a compounder’s medicines or attempted to shutter an operation.
    • For more, click here.
  • FDA Proposal Would Allow Drugmakers To Rebut Warnings
    • The Food and Drug Administration is proposing to allow pharmaceutical companies to contradict official safety warnings in sales presentations to customers.
    • While an FDA warning about a drug’s dangers can scare off buyers, the new proposal would allow the companies to present customers with information that undermines official warnings as long as it comes from a peer-reviewed journal article.
    • For more, click here.

Accountable Care Organization

  • Next Generation Accountable Care Organization (ACO) Model Open Door Forums Announced
    • In follow-up to the March 10, 2015 announcement of the Next Generation ACO Model of payment and care delivery, the Center for Medicare & Medicaid Innovation (CMS Innovation Center) will host several open door forums focusing on various aspects of the Model.
    • Additional information on this Model and the upcoming open door forums can be accessed through the Next Generation ACO Model web page.

US Supreme Court

  • US Supreme Court Rules Providers Can’t Sue Medicaid For Higher Reimbursement
    • Medicaid providers cannot sue the government seeking to raise their reimbursement rates, the Supreme Court ruled Tuesday.
    • The case Armstrong et al. v. Exceptional Child Center Inc. involved a group of child care centers specializing in children with intellectual and developmental disabilities. The centers sued the state of Idaho, claiming that it reimbursed them at rates lower than allowed by Medicaid law. The district court ruled in favor of the centers, and the appeals court agreed with that decision.
    • For more, click here.

US District Court

  • US District Court Rules in Foreign Pharmaceutical Importation Case in Maine
    • On Monday, Feb. 23, 2015, Judge Nancy Torresen ruled in favor of the Maine Pharmacy Association and Retail Association of Maine case against the State of Maine (Ouellette, et al vs. Mills) regarding the importation of medications from specific foreign countries. Judge Torresen ruled definitively in MPARx’s favor that the Maine law passed in 2012 (LD 171, Public Law chapter 373) violates federal laws which were established to protect the public from unsafe medications.
    • From the beginning, MPARx raised significant concerns about threats to public safety by the illegal importation of prescription drugs into Maine through foreign-based brokers and other entities. The federal government strictly limits importation of pharmaceuticals for personal use, yet the Maine law looked to circumvent this secure drug-supply system.

Centers for Disease Control

  • CDC: More EMS Workers Should Be Trained To Administer Naloxone For Drug Overdose
    • As of last year, only 12 states allow basic emergency medical service workers to administer naloxone in case of an opioid prescription drug overdose, while advanced EMS workers are allowed to do so in all 50 states, according to a CDC report that called for expanded access. Naloxone is a non-addictive drug that can be administered nasally to help prevent death due to overdose. The report, published in the American Journal of Public Health, shows that naloxone is most likely to be administered to patients who are female, between the ages of 20 and 29, and residents of suburban areas.
    • For more, click here.
  • CDC MMWR Article: Pneumonia Outbreak in a Long-Term Care Facility
    • In a recent edition of its Morbidity and Mortality Report (MMWR), the Centers for Disease Control and Prevention (CDC) published an article reporting on a recent outbreak of Mycoplasma pneumonia infections in a Nebraska long-term care facility. Worth reading, the article reports on the epidemiologic investigation and public health response. The discussion section of the report highlights the importance for prompt recognition and reporting of outbreaks, diagnostic testing, and implementation of timely infection control measures to prevent spread of illness and resident death.
    • For more, click here.

Substance Abuse and Mental Health Services Administration

  • SAMHSA Issues Revised Federal Guidelines For Opioid Treatment Programs
    • The Substance Abuse and Mental Health Services Administration last week issued revised federal guidelines for opioid treatment programs. According to the agency, the guidelines contain updated information on ways to assess and counsel patients; treatment of pregnant patients; patient withdrawal from medication-assisted treatment; and management of patients with multiple problems, including chronic pain. They also include new information on topics such as telemedicine; electronic health records; prescription drug monitoring programs; recovery; the role of physicians, nurses, and other program staff; and the full range of FDA-approved medications, including methadone, buprenorphine and injectable naltrexone.

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