Washington Healthcare Update: March 3, 2014

This Week: Chairman Camp releases tax reform proposal... CMS issues guidance on "two-midnight" rule... CBO updated score of SGR replacement proposal.

  1. CONGRESS

    House

    Chairman Camp Unveils Tax Overhaul Plan

    House Ways and Means Chairman Camp (R-MI) has released a discussion draft of proposed sweeping tax reform legislation. Specifically, the proposal would collapse the existing tax bracket structure into two brackets of 10 and 25 percent for virtually all taxable income, ensuring that over 99 percent of all taxpayers face maximum rates of 25 percent or less. The plan also reduces the corporate rate to 25 percent. While the plan generally leaves the ACA untouched, the legislation would repeal the medical device tax and the medicine cabinet tax, which prohibits use of funds from tax-free accounts to purchase over-the-counter medication without first obtaining a prescription. The Ways and Means Committee is seeking input and feedback on technical and policy issues raised by the draft. The Committee also invites input on the accompanying technical explanation prepared by the JCT staff, a document that could serve as the basis for similar legislative history on any future tax reform legislation that may be considered by the Committee.

    Energy and Commerce Hearing Explores Counterfeit Drug Threat

    On Feb. 27, the Energy and Commerce Subcommittee on Oversight and Investigations held a hearing entitled "Counterfeit Drugs: Fighting Illegal Supply Chains." The purpose of the hearing was to explore the public health threat of counterfeit drugs, and to build on the recent enactment of the Drug Quality and Security Act (DQSA) to identify other areas to strengthen U.S. efforts to combat the growing threat of counterfeit drugs to U.S. patients. Witnesses offered testimony addressing issues such as FDA inspections of international drug manufacturing facilities and efforts to combat introduction of illicit drugs into the secure drug supply chain established by DQSA.

    Witnesses:

    Panel I Howard Sklamberg, J.D. Deputy Commissioner for Global Regulatory Operations and Policy Food and Drug Administration (FDA)

    Lev Kubiak Director, National Intellectual Property Rights Coordination Center Department of Homeland Security, Immigration and Customs Enforcement (ICE)

    Panel II Marcia Crosse, Ph.D. Director, Health Care U.S. Government Accountability Office

    Prashant Yadav, Ph.D., M.B.A. Director of Health Care Research Initiative, Director of the William Davidson Institute University of Michigan

    John P. Clark Vice President and Chief Security Officer, Global Security, Compliance Division Pfizer Inc.

    Jean-Luc Moreau Global Head of Product Security Novartis Corporation

    Bruce Longbottom, J.D. Assistant General Counsel Eli Lilly and Company

    Elizabeth Jungman, J.D., M.P.H. Director, Drug Safety and Innovation Pew Charitable Trusts

    For more information, or to view the hearing, please visit energycommerce.house.gov.

    Energy and Commerce Hearing on Proposed Part D Regulations

    On Feb. 26, the Energy and Commerce Health Subcommittee held a hearing entitled "Messing with Success: How CMS' Attack on the Part D Program Will Increase Costs and Reduce Choices for Seniors." The hearing focused on a Jan. 6, 2014, CMS proposed rule that would, among other things, establish new criteria for identifying protected classes of drugs, and revise the regulatory definition of negotiated prices. Republicans claim the changes undermine the competitive structure of a successful program, while CMS insists the changes improve health quality and lower beneficiary costs.

    Witnesses:

    Panel I Jonathan Blum Principal Deputy Administrator Centers for Medicare & Medicaid Services

    Panel II Douglas Holtz-Eakin President American Action Forum

    Carl Schmid Deputy Executive Director The AIDS Institute

    Joe Baker President Medicare Rights Center

    For more information, or to view the hearing, please visit energycommerce.house.gov.

    GOP Letter to CMS Requests Improved Provider Fraud Screening

    In a letter dated Feb. 26, three high-ranking Republican members of the House Energy and Commerce Committee -- Committee Chairman Fred Upton (R-MI), Chairman Emeritus Joe Barton (R-TX) and Rep. Michael Burgess (R-TX) -- sent letters to the Centers for Medicare & Medicaid Services (CMS) and the Department of Health and Human Services (HHS) urging stronger screening measures for health care providers receiving economic stimulus funds such as electronic health records (EHR) incentive payments. The letter comes in response to reports of a Texas rural hospital chain, the recipient of $18 million in incentive payments for EHR, despite being at the centers of warnings from several agencies of patient-care threats and allegations of fraud. "Given these reports, we have every reason to be concerned about how facilities are being screened and what processes the administration has to detect and prevent fraud," Rep. Burgess said in a statement. The letter to CMS called for a briefing by the Agency on its current screening procedures and the steps it was taking to coordinate its efforts with the General Services Administration and the Food and Drug Administration. Moreover, the letter to HHS Office of the Inspector General (OIG) also requested a briefing and the list of recommendations OIG had given CMS on ways to improve provider screening, including a list of databases that can assist in the provider screening process. According to the letter, briefings and information must be provided before March 12, 2014.

    Health Subcommittee Advances Four Health-Related Bills

    On Feb. 27, the Energy and Commerce Health Subcommittee held a markup of four bipartisan health-related measures aimed at addressing issues facing newborn babies, trauma patients and veterinarians. Specifically, the bills were:

    H.R. 3548, Improving Trauma Care Act of 2013 - The bill would amend the Public Health Service...

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