Spring 2024

PERSPECTIVE: REVIEW OF NATIONAL ASSOCIATION FOR HOME CARE & HOSPICE V. BECERRA

In 2020, over 3 million people received home health care services in the United States [1]. Home health care services are covered under the Medicare program and administered by the Centers for Medicare & Medicaid Services.  Section 1395 of U.S.C. 42 outlines the process of how Medicare pays for home health services through the Home Health Prospective Payment System. At issue is a final rule that will implement revisions to the payment system.

The National Association for Home Care & Hospice (“NAHC”) filed a complaint in the in the U.S. District Court for the District of Columbia against the Secretary of the United States Dept. of Health & Human Services because Medicare payments provided by the Centers for Medicare and Medicaid Services under the final rule were not budget neutral and improperly calculated per the Bipartisan Budget Act of 2018, resulting in a decrease in payments.

In the complaint, the plaintiff challenges the final rule stating: “… the rule violates the Medicare statute’s plain language and arbitrarily and capriciously sets payment rates at a level that will result in substantial financial harm to numerous home health agencies across the country [2].” The plaintiff also notes “Congress instructed the Secretary to compute a standard prospective payment amount for the unit of service to be based on aggregate home health agency costs as reflected in the most recently audited home health costs reports at that time [3].”

05 U.S.C § 551 of the Administrative Procedure Act permits judicial review of agency actions, findings, and conclusions that are not in accordance with law or are in excess of statutory jurisdiction, authority, or limitations. As a form of redress, the plaintiff requests an injunction that directs the Secretary to withdraw or suspend the final rule and withhold applying the new payment system until the rule has been revised [4].”


[1] National Center for Health Statistics. Home Health Care, Hyattsville, MD. 2023

[2] National Association for Home Care & Hospice v. Becerra, 23-cv-01942

[3] Id.

[4] Id.

Standard
Winter 2023

PERSPECTIVE: PRESERVING TITLE X OF THE PUBLIC HEALTH SERVICES ACT

Title X of the Public Health Services (PHS) Act is a family planning program enacted in 1970 that requires physicians to recommend family planning services and related preventative health services to low-income and uninsured individuals. In 2016, more than four million patients, almost 90% of whom were poor or low-income, obtained care through the Title X program[1]. Per the Health & Human Services, Title X is intended to (1) advance health equity through the delivery of Title X services (2) improve and expand access to Title X services and (3) ensure health care delivery of the highest quality (cite)…..

The fiscal year (FY) 2018 Funding Opportunity Announcement (FOA) altered the criteria for the grant-making process of Title X. National Family Planning & Reproductive Health Association (NFPRHA), a non-profit organization that provides Title X-funded services, filed a motion in federal court requesting injunctive relief because the 2018 FOA undermines the objectives of Title X. The plaintiff argues the “requirement of directive counseling, the lack of any reference to biomedical family planning methods, the elimination of any mention of the recognized clinical guidelines, the minimizing of the importance of direct medical care, and other changes made by the 2018 FOA mainly favor grant applicants with little or no experience in providing high-quality family planning care[2].” The plaintiff’s claim is “unless defendants are enjoined from the 2018 FOA by this Court, NFPRHA’s physicians and the millions of patients they serve each year will suffer irreparable harm” because “Title X became, and remains, the only dedicated source of federal funding for family planning services in this country[3].”

Challenges by Planned Parenthood to the 2018 FOA were reviewed with this claim. The district court ruled against the plaintiffs citing the claim was not “reviewable” by the Administrative Procedure Act (APA). An appeal was filed and the United States Court of Appeals ruled because “the 2018 grant process has long since concluded, superseded by an amended 2019 FOA, no meaningful injunctive relief could be provided making the case moot and any declaration that the 2018 FOA was unlawful would amount to an advisory opinion.

The American Medical Association (AMA) contends the 2019 gag rule stemming from the 2018 FOA violates a code of medical ethics. The AMA states open and frank communication of what family planning services physicians can discuss with their patients is a tenant of quality care and any limitation to that rule diminishes medical standards. New motions for a preliminary injunction were filed by several states to block the 2019 gag rule from taking effect after being published in the Federal Register on March 4, 2019. The outcome of these legal challenges resulted in conflicting conclusions of the 2019 gag rule with no uniform consensus on the legality of the rule. Ultimately, a petition for certiorari was filed and the Supreme Court dismissed plaintiffs’ legal challenges to the gag rule because an amendment to the 2019 gag rule was enacted in 2021 allowing physicians more autonomy of what family planning services can be recommended or discussed with their patients.

[1] National Family Planning & Reproductive Health Association v. Azar, No. 1:18-cv-00756 (D.D.C. filed Apr. 19, 2018).

[2] Id.

[3] Id.

Standard
Fall 2023

PERSPECTIVE: CHALLENGES TO THE PRICE NEGOTIATION REGULATION FOR MEDICARE

The Inflation Reduction Act implemented a regulation allowing price negotiation in the Medicare program to lower the cost of prescription drugs and to increase transparency. Section 1195 of the Inflation Reduction Act “penalizes any manufacturer of a selected drug that has entered into an agreement under §1193, with respect to a year during the price applicability period with respect to such drug, that does not provide access to a price that is equal to or less than the maximum fair price for such drug for such year.” With no prior federal regulation in place to deter price gouging, the new regulation establishes a pathway for negotiating lower prescription drugs supplied in the Medicare program, increasing access to care. Recently, the Centers for Medicare Services identified the first 10 drugs supplied through the Medicare program selected for initial price applicability in 2026. These drugs are common drugs you would see listed on the Medicare Part D drug list ranging from insulin to drugs to treat heart failure. CMS selected these drugs based on some of the following criteria (1) drugs for which there is no generic offered after 11 years of FDA approval and (2) drugs with the highest total gross covered prescription costs. In response to this new legislation, there are pending lawsuits filed by pharmaceutical companies claiming constitutional protection and perceived harm to consumers for creating an anti-competitive market. The challenges will be difficult to defend in light of public opinion because the new regulation is an improvement to the Part D drug program offering seniors lower drug prices.

Standard
Summer 2023

PERSPECTIVE: IMPLICATIONS FOR PROTECTING ONE’S ACCESS TO FEDERAL HEALTH CARE COVERAGE

In Health and Hospital Corporation of Marion County, Indiana v. Talevski, the issue presented was whether a third party to a contract pursuant to the Spending Clause has a privately enforceable right. Congress limits how a state may spend federal money by imposing regulations and conditions on funding. The appellant, in this case, argues he has a privately enforceable right because he is a third party to the funds supplied through the Medicaid program regulated by the Spending Clause. The Federal Nursing Home Amendments Act regulates whether nursing facilities receive Medicaid funding based on how their facility is managed. The claim filed states that as a private citizen who is a third party to the benefit of federal funds received through the Medicaid program, the appellant had the right to enforce the Spending Clause as a privately enforceable right. The court agreed. The United States Court of Appeals reversed that decision and recognized a viable claim pursuant to the Federal Nursing Home Amendments Act (FNHRA) of 1987 protected by 42 U.S.C. § 1983 in spite of how the nursing facility is being regulated by the Spending Clause. The right to enforce federal spending in a private cause of action is implied in the Supreme Court case Wilder v. Virginia Hospital Association, where the Court determined there was a substantive federal right and it was not Congress’ intent to prevent redress of this privately enforceable right. The Supreme Court held that the “FNHRA provisions at issue unambiguously create §1983-enforceable rights, and the Court discerns no incompatibility between private enforcement under §1983 and the remedial scheme that Congress devised.” Health care coverage is not a right supported by the Constitution; it is an auxiliary benefit created by Congress. The overarching health care debate has been whether health care coverage in this country should be financed by public funds. The implications of this court decision could have a long-standing impact on how health care coverage evolves and whether precedent could be established or policies implemented to support a recognizable right to health care coverage in the United States.

Standard
Spring 2023

PERSPECTIVE: INCREASING ACCESS TO CARE WITH LOWER PRESCRIPTION DRUG PRICES

The pricing of prescription drugs has come under scrutiny recently by consumers who believe manufacturers set an extremely high price for highly sought-after prescription drugs for consumer use. More than 5 million Medicare beneficiaries struggle to afford prescription drugs[1]. Prescription drug prices are set by each manufacturer known as the list price. The Inflation Reduction Act was implemented in August to help with the cost of prescription drugs in the Medicare program. The new regulation allows the federal government to negotiate lower drug prices supplied through the program, increasing access to care. With no prior federal regulation in place to deter price gouging, §1191 of the Inflation Reduction Act establishes a pathway for negotiating lower prescription drugs supplied in the Medicare program. With this new regulation, drug companies will be fined for price gouging of prescription drugs supplied through the Medicare program. Section 1195 of the Inflation Reduction Act “penalizes any manufacturer of a selected drug that has entered into an agreement under §1193, with respect to a year during the price applicability period with respect to such drug, that does not provide access to a price that is equal to or less than the maximum fair price for such drug for such year.” Recently, a list of prescription drugs supplied through the Medicare program whose list prices increased higher than the rate of inflation was released. The companies that manufactured these drugs will face a penalty in the form of a rebate.

Consumers who rely on insulin have been very vocal about the burdens of gaining access to affordable insulin. An estimated 1.4 million new cases of diabetes were diagnosed among people ages 18 and older in 2019 [2]. The prevalence of diabetes in the United States is estimated to be 11% with 23% undiagnosed and 76% diagnosed with the condition [3]. Diabetics have higher comorbidities rates compared to other chronic conditions because of overlapping risk factors. People with diabetes account for $1 of every $4 spent on health care, paying more than twice as much a year for health care than a person who does not have the disease [4]. Most people who can’t afford this medication either skip doses or stop taking the medication which can result in hospitalization for care, thus placing a burden on the health care system by rendering care that could have been easily prevented. The cost of insulin for consumers rises annually. Depending on your health care coverage, the cost of insulin can vary between $25 to $300 per vial[5] .  As highlighted by the Senate Finance Committee’s report on insulin list prices, the amount of revenue retained by drug manufacturers has risen simultaneously with the out-of-pocket cost of insulin for their consumers.

Recently, Eli Lily and Company and Novo Nordisk, PLLC announced they will reduce the cost of insulin drugs manufactured at their companies. Eli Lily reduced the cost of insulin by % 70, placing a cap of $35 on monthly out-of-pocket costs for people who are not covered by Medicare’s prescription drug program. The drug company also announced that their generic version of insulin would be capped at $25 a vial starting in May. The drug company Novo Nordisk will reduce branded insulin prices by 75% starting in January 2024 as well as lower the prices of generic insulin prices. These initiatives taken by Eli Lilly and Novo Nordisk set a standard for other drug companies to follow.

[1] Office of the Assistant Secretary for Planning and Evaluation, U.S. Department of Health & Human, Services. Secretary of Health and Human Services’ Report on Prescription Drug Affordability among Medicare Beneficiaries. 2022. Prescription Drug Affordability among Medicare Beneficiaries (hhs.gov).

[2] Centers for Disease Control and Prevention. (2022). National diabetes statistics report: Estimates of diabetes and its burden in the United States. https://nationaldppcsc.cdc.gov/s/article/CDC-2022-National-Diabetes-Statistics-Report1.

[3] Centers for Disease Control and Prevention. National Diabetes Statistics Report website. https://www.cdc.gov/diabetes/data/statistics-report/index.html. 

[4] American Diabetes Association. (n.d.). Insulin and Drug Affordability. https://www.diabetes.org/advocacy/insulin-and-drug-affordability..

[5] Cohen, J. (2021, January 5). Insulin’s Out-Of-Pocket Cost Burden To Diabetic Patients Continues To Rise Despite Reduced Net Costs To PBMs. Forbes. https://www.forbes.com/sites/joshuacohen/2021/01/05/insulins-out-of-pocket-cost-burden-to-diabetic-patients-continues-to-rise-despite-reduced-net-costs-to-pbms/.

Standard