WASHINGTON WIRE
May 4, 2007
Issue 131
In this issue, you'll find:
HHS Official Tapped as New CMS Administrator
CMS Releases Final Rule on LTCHs, Proposed Rule on IRFs
Senate Debates Drug User Fee Bill, Considers Importation Amendments
Top Story
HHS Official Tapped as New CMS Administrator
On Thursday, President Bush announced his intention to nominate Kerry N. Weems to be Administrator of the Centers for Medicare and Medicaid Services (CMS).
Mr. Weems currently serves as Deputy Chief of Staff at the Department of Health and Human Services (HHS) and has been with the department for 24 years. Weems also has served as acting assistant HHS secretary for budget, technology, and finance, HHS deputy assistant secretary for budget, and chief financial officer.
In nominating Weems, the President bypassed the current Acting Administrator Leslie Norwalk, who stated earlier this year she would not like to be considered, and the current Deputy Administrator and previous Medicare Director, Herb Kuhn.
The President also announced his intention to nominate Tevi David Troy, current Deputy Assistant to the President for Domestic Policy, as Deputy Secretary of Health and Human Services.
Health Care News
CMS Releases Final Rule on LTCHs, Proposed Rule on IRFs
Early this week, the Centers for Medicare and Medicaid Services (CMS) released a final payment rule for long term acute care hospitals (LTCHs) which would cut payments by 3.8 percent in rate year (RY) 2008.
In an unusual move, the final 3.8 percent payment drop exceeds the 2.9 percent proposed cut issued in January. CMS states that the decrease largely results from "existing, longstanding policy" -- specifically updates to the high-cost outliers fixed amount and to the wage index.
To the discontent of many stakeholders, the rule also included an expansion of the "25 percent rule," which penalizes certain LTCHs for accepting more than 25 percent of their patients from a single referring hospital. The rule currently only applies to "hospitals within hospitals" and LTCHs and their satellite offices. However, the expansion will apply the rule to all LTCHs and will be phased-in over the next three years.
CMS also released a proposed payment rule for Inpatient Rehabilitation Facilities (IRFs) which would increase Medicare payments by 3.3 percent in 2008.
The proposed rule would also continue the phased-in implementation of Medicare's "75% Rule," which requires that a certain percentage of patients treated at an IRF meet one of thirteen specified diagnoses. As part of the phase-in of the 75% Rule, comorbidities can be considered in meeting the threshold criteria until July 1, 2008. Although the proposed rule does not propose changes to the comorbidities provision, it does invite comments on potential modifications.
Currently at 60 percent, the threshold is scheduled to go up to 65 percent on July 1, 2007 and 75 percent on July 1, 2008. Many stakeholders claim that the 75 percent rule arbitrarily restricts access, potentially diverting individuals in need of coordinated inpatient rehabilitation to less intensive settings.
Senate Debates Drug User Fee Bill, Considers Importation Amendments
The Senate voted on Thursday to limit debate on a controversial drug importation amendment to the must-pass "FDA Revitalization Act."
Among other things, the FDA Revitalization Act would reauthorize the Prescription Drug User Fee Act (PDUFA), which governs the fees paid by pharmaceutical makers to the Food and Drug Administration (FDA) and is set to expire this September. The reauthorization legislation would also implement new post market drug safety provisions. As the first comprehensive FDA legislation to be considers in a number of years, this bill is seen as a conduit for passing other FDA-specific legislation, including "importation."
During floor debate this week, Senators Byron Dorgan (D-ND) offered an amendment cosponsored by Olympia Snowe (R-ME) that would allow importation of prescription drugs from Canada as well as nearly 30 other countries. The amendment aims to lower prescription drug costs for many Americans by allowing improved access to lower prices in other countries.
The Congressional Budget Office (CBO) estimates the savings to the federal government to be approximately $10.6 billion over ten years and the overall savings to the government, consumer and payors to reach $50 billion over ten years. However, opponents contend that the safety of imported drugs can not be assured and the loss of revenue to drug companies will result in decreases in pharmaceutical research.
In an attempt to essentially invalidate the importation legislation, Senator Cochran (R-MS) offered an amendment to Senator Dorgan's amendment that would require the government to certify the safety of imported drugs. Neither the Clinton nor Bush Administrations have been able to ensure the safety of imported drugs.
The Senate is expected to resume debate on the legislation on Monday, May 7th.
PPSV in the News
PPSV Principal Jim Pyles appeared on Fox News on April 30 commenting on the Executive Order issued by Virginia Governor Tim Kaine that would require reporting to a national database the name of any individual suffering from mental illness who has ever been found to be a danger to himself or others. That database, known as the Central Criminal Records Exchange, must be consulted by any gun dealer before a new gun is sold to an individual. Mr. Pyles was invited to appear as a nationally recognized expert in the law pertaining to health information privacy.
Upcoming Events
Hearings
Monday, May 7, 2007
Fiscal 2008 Appropriations: Labor, HHS, Education
Senate Appropriations - Subcommittee on Labor, Health and Human Services, Education, and Related Agencies
1:30 pm, 116 Dirksen
Tuesday, May 8, 2007
Medicare Prescription Drug Benefit
Senate Finance Committee
10 am, 215 Dirksen
DOD-VA Sharing of Electronic Medical Records
House Veterans' Affairs - Subcommittee on Oversight and Investigations
10 am, 334 Cannon
Wednesday, May 9, 2007
Safety of Drug Supply
House Energy and Commerce - Subcommittee on Health
10 am, 2123 Rayburn
Long-term Care
House Veterans' Affairs - Subcommittee on Health
10 am, 334 Cannon
Medicare and Chronic Care
Senate Special Aging Committee
3 pm, 106 Dirksen
For More Information
For further information on any topics discussed or publications listed, or to get copies of anything mentioned in this alert, please call 202.466.6550 and ask for the Legislative Practice Group.
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