On October 17th, the Administration released its semiannual forecast of the rules that the Department of Health and Human Services (HHS) will be churning out over the next year. The list includes nearly 200 rules, 23 of which are already posted on the Office of Information and Regulatory Affairs (OIRA) dashboard. The bulk of the rules on the Agency Rule List for Fall are under the purview of CMS or the FDA (63 and 77 rules, respectively). Also, earlier in October, FDA’s device center released a list of draft and final guidance documents that it plans to publish in FY 2019. Many of these rules and guidance documents touch on issues that are top of mind and we expect that the administration will be moving forward with many of these priorities in the coming months.
In addition to a rule currently published on OIRA, which would revise the pharmaceutical discount safe harbor protections for PBMs and plans, the Agency Rule List for the Fall contains two additional forthcoming rules. One rule aims to address undue regulatory impact of the federal physician self-referral law (known as the Stark Law), and another is a request for information (whose comment period ends on October 26th) regarding the removal of barriers to coordinated or value-based care.
The list includes rules that would limit exceptions to provider payments under Medicaid, streamline the appeals process under Medicare, implement cost sharing mechanisms under Medicaid, reexamine non-emergency medical transportation coverage requirements for states under Medicaid and make changes to regulations for accountable care organizations under the Medicare Shared Savings Program. These proposed rules are in addition to the proposed rule that would advance CMS’ efforts to streamline the Medicaid and CHIP managed care regulatory framework and a pre-rule pertaining to the Medicare Program and Indexed Price Concession Model that are already published on OIRA. CMS is also looking to modify the Medicare coverage process in order to streamline coverage of breakthrough technologies, which could be related to a CMS/FDA program to harmonize data requirements for FDA approval/clearance and CMS coverage of these new technologies. Look, too, for FDA’s Breakthrough Devices guidance, which—while not related to coverage—will provide information about how a device manufacturer can request this specific designation and what to expect throughout the device review process.
The administration made headlines on October 15th with its release of a proposed rule that would require the disclosure of pharmaceutical list prices on drug advertisements. The Agency Rule List for Fall also includes a final rule that deals with prescription drug advertising. The final rule, which was proposed in 2010 and is expected to be finalized in July of 2019, is expected to amend FDA regulations concerning direct to consumer advertising of prescription drugs, for example through radio and TV. Additionally, FDA is expected to release a proposed rule in November 2018 that aims to remove FDA regulations that were rendered void through the enactment of certain provisions of the Drug Supply Chain Security Act (DSCSA).
As highlighted in Politico on October 18th, the Agency Rule List also includes a proposed rule intended to make changes to the Medicaid Drug Rebate Program to support value-based drug purchasing between states and manufacturers, which is a big deal for the way drug prices are set. In June 2018, CMS approved Oklahoma’s Medicaid State Plan Amendment, which authorized the state to negotiate supplemental rebate agreements for pharmaceuticals involving value-based purchasing arrangements with drug manufacturers. We will be paying attention to the proposed rule’s release, which is set for June 2019, and watching the Oklahoma model for signs of how a national version could play out.
The administration is still working to implement regulatory changes required by the 21st Century Cures Act, which was enacted in December 2016. A proposed rule already listed by OIRA intended to advance the interoperability needed to implement parts of the 21st Century Cures Act, will likely be joined later this year by another rule related to the Cures Act’s digital health/software provisions. The Agency Rule List includes an FDA housekeeping item to revise regulations to reflect certain products that, as a result of statutory changes to the definition of "device" made in the Cures Act, are no longer devices within FDA’s jurisdiction. This will align FDA’s regulations with the statute. Though not through rulemaking, FDA has been active in the digital health space, and we’re watching closely to see how the agency will oversee these technologies. Among the final digital health guidance documents FDA plans to issue in FY 2019 are: Changes to Existing Medical Software Policies Resulting from Section 3060 of the 21st Century Cures Act; Clinical and Patient Decision Support Software; and Multiple Function Device Products: Policy and Considerations.
FDA also plans to issue a draft guidance document addressing device servicing and remanufacturing. This action follows recent activity including public meetings and a congressionally-mandated report about device servicing, which includes refurbishing, reconditioning, rebuilding, or repairing. For certain devices, activities thought to be servicing are actually remanufacturing due to the impact of the activity on the devices’ safety and effectiveness. We’re looking to FDA to provide clarity for entities engaged in servicing so that they know when they cross the line into remanufacturing that would cause more rigorous regulatory requirements to kick in.
Stay tuned for continued updates from us on the major issues on the administration’s rulemaking and guidance agenda, and as always, reach out to us with any questions.
*Olivia Graham also contributed to this post.