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On October 3rd, the United States Senate passed a bipartisan opioids package with a sweeping vote of 98 to 1, after the U.S. House of Representatives passed the final version of the bill with a vote of 393 to 8. One of its components, the “Fighting the Opioid Epidemic with Sunshine Act,” expands the scope of reporting requirements under the Physician Payment Sunshine Act (known as the “Sunshine Act”), which will have immense implications for the pharmaceutical and medical device and supply industries.

Enacted at section 6002 of the Affordable Care Act in 2010 to increase transparency around the financial relationships between health care providers and drug manufacturers, the Sunshine Act requires “applicable group purchasing organizations” and “applicable manufacturers,” including pharmaceutical and medical device or supply companies with operations in the United States, to track and report payments and transfers of value that they make to “covered recipients,” currently defined to include physicians and teaching hospitals. These transfers of value include items such as consulting fees, honoraria for speaking events, and research grants.

The opioids legislation package expands the definition of “covered recipients” to include other types of health care professionals: physician assistants, nurse practitioners, clinical nurse specialists, registered nurse anesthetists, and certified nurse midwives. The new legislation additionally sunsets a prohibition in the Sunshine Act that prevents the inclusion of the National Provider Identifier on the CMS Open Payments website.

Given the Administration’s focus on the opioid crisis, identified as a “national emergency,” the expansion of the Sunshine Act reflects the reality that prescriptions of opioids and other drugs to individuals may come from health professionals who are not physicians. State “sunshine laws” that imposed reporting requirements on payments to these professionals have existed for a number of years, but the changes passed in the opioids package would make this standard the baseline for reporting covered payments nationwide. By the time these changes would be effective on January 1, 2022, applicable group purchasing organizations and manufacturers will need to update their Sunshine Act compliance and monitoring activities to account for the greatly enlarged scope of individual health care professionals to whom they may be providing direct or indirect transfers of value.

The expansion of the Sunshine Act’s covered recipient definition was introduced in the Senate version of the opioids package, and remained in the overall legislation despite vigorous opposition. To become law, the bill requires the signature of President Trump.

Federal agencies are signaling closer oversight of Medicaid managed care organizations (“MCOs”). On August 21, 2018, the U.S. Comptroller General Gene Dodaro and Centers for Medicare and Medicaid Services (“CMS”) Administrator Seema Verma testified to the Senate Homeland Security and Governmental Affairs Committee about combating Medicaid fraud and urged additional oversight of Medicaid MCOs and a larger restructuring of the Medicaid program. This testimony follows other steps taken by the Governmental Accountability Office (“GAO”) and CMS earlier this year to encourage increased scrutiny of Medicaid managed care programs. Continue Reading GAO and CMS Seek Increased Scrutiny on Medicaid Managed Care Organizations

The Department of Labor’s proposed rule on association health plans (AHPs), issued in response to an October 12, 2017 Executive Order, has received almost 900 comments, including from several states and the District of Columbia (see, e.g., comments from Alaska, Iowa, Massachusetts, Montana, Pennsylvania, and Wisconsin). States emphasized the need for clarity in the rule and affirmation of states’ long-standing authority to regulate insurance including both solvency and consumer protection issues. Iowa, for example, attributed the more than 40-year success of a multiple employer welfare arrangement (MEWA) to both the entity’s interests to serve its members and the Iowa Insurance Division’s authority to ensure that MEWAs are “adequately solvent and following fair trade practices” and argued that continued robust state insurance oversight is critical to successful AHPs.

Last week, the Iowa Senate approved two bills which, if passed by the Iowa House of Representatives, would expand the availability in the state of AHPs, a type of MEWA covered by the Employee Retirement Income Security Act of 1974 (ERISA). The legislation would allow for Wellmark Blue Cross Blue Shield to administer an AHP for the Iowa Farm Bureau Federation and could threaten the membership of Medica, the only issuer of coverage through Iowa’s exchange.

Continue Reading States Seek Control over Association Health Plans in Comments on DOL Proposed Rule; Iowa Senate Approves Bill Expanding Availability of Association Health Plans—Potentially to the Detriment of ACA Exchange Plans

On March 8, the White House encouraged Congress to pass stabilization legislation that would not authorize the reimbursement of cost-sharing reductions (CSRs) made by health plans in 2017, as reported by Modern Healthcare. This move comes almost five months after the Trump Administration’s announcement in October that it would discontinue CSR payments effective immediately. The legislation, if passed, would preclude the government from paying CSRs for the 2017 year and would allow CMS to claw back surplus money that plans have received from the federal government and applied towards CSRs. Continue Reading White House Proposes Language to Congress Eliminating CSR Reimbursement for 2017