Key Health Law Developments in 2023 and What to Expect in 2024

Judith Waltz, Partner, Foley & Lardner LLP, and Faraz Siddiqui, Associate, Hyman Phelps & McNamara PC, discuss some of the key health law developments in 2023 and what to expect in 2024. They focus on issues related to Medicare and Medicaid and drug development and reimbursement. Waltz and Siddiqui are editors of AHLA’s bestselling title, Federal Health Care Laws and Regulations. They pay tribute to the late William Horton, who was the long-time editor of the title.

Watch the conversation here.

To learn more about AHLA and the educational resources available to the health law community, visit americanhealthlaw.org.

Transcript

Speaker 1: 0:00

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Speaker 2: 0:07

This episode of A HLA speaking of health law is brought to you by a HLA members and donors like you. For more information, visit American health law.org.

Speaker 3: 0:21

Good morning, I'm Judy Walls. I'm a partner with Foley Launder in the San Francisco office. I'm co-chair of our healthcare group, which is about 50 people at this point. And , um, practicing in various areas of healthcare law. The reason that Oz and I are here today, and Faraz , you'll hear from him in just a minute, is that we are co-editors of the book, the A HLA, federal Healthcare Laws and Regulations. This is published every year , um, some years it's just published as a supplement, other years. It's published as a three volume set, which you can see behind RA's shoulder there this year. It's in a beautiful purple. And on the, the reason I wanna call this to your attention, first of all, explains how we ended up in this, in this podcast, but secondly, on the cover, it says, dedicated to William Horton. And I wanna make sure that everyone knows who William Horton , uh, was. As you might imagine, he, he's no longer with us. He died , um, last year. He was the editor of this publication for many years, including until his death , um, last year. He was very involved with A HLA. He was just a wonderful person and just , um, very smart, often, often , uh, deliver the ethics sessions because his sense of humor made everything just very amusing. And for ethics courses that can, can often be a , a real challenge. So we, we missed him dreadfully. And , um, just wanna make sure that his, he in the past has co-hosted this and, and really moderated it. So we're, we're missing him on several fronts , um, today. So our, our point today about what we're discussing is some of the topics that were within the areas that Raz and I covered as co-editors of this publication. So, Raz will tell you about his section. Mine was the Medicare and Medicaid updates. Um, and as you might imagine, that is, is never a , um, I mean, despite all the, all the problems with congressional legislation, there's, there's always a lot in the Medicare space. And we look at the things that have been added over the years and deleted on occasion , uh, to decide what should be included. So, with that, I'm gonna turn it over to Ferraz , and he's gonna introduce himself, and he's gonna start with his part. And then we'll be back to Meraz.

Speaker 4: 2:55

Thank you. Thank you for that, Judy. Um , and thank you to a HLA for bringing us together to have this conversation. Um, Judy, thank you for the beautiful words dedicated to, to Bill . We will , uh, miss him , uh, and I know our , um, uh, audience and, and readers will also miss him. Um, as a disclaimer , uh, everything that we are providing , uh, in this podcast , uh, uh, is , uh, for informational purposes only. This is , uh, not , uh, legal advice and , uh, uh, from either myself or from Judy. Uh, and our , uh, information that we provide over here does not constitute , uh, attorney , uh, advice or , uh, uh, an attorney-client , uh, relationship between us and the listeners. So, as Judy , uh, mentioned , uh, uh, both of us are , uh, editors of , uh, the A HLA , uh, that this a HLA book. Uh , and, you know, over the, over the course , uh, year after year, we, we look at the various , uh, federal re uh, regulations and laws that have changed and get this, I , you know, get , get an overarching view of how , uh, the laws in , uh, respective areas are being developed. Um, myself, I'm an associate at Hyman Felds and McNamara. We are the largest FDA focused law firm. My personal practice , uh, is with , uh, clients who are manufacturers , uh, distributors , uh, uh, uh, and sponsors of clinical trials for drugs. Um, I work on government pricing and reimbursement issues. I do a little bit of fraud and abuse work, and I also help clients advise clients on drug development issues , uh, uh, before approvals of drugs or biologics. I help them with post-approval compliance issues as well, such as advertisement and promotion , uh, and , uh, post-approval reporting to the FDM. So, I work on both , uh, FDA laws for , for this publication. I , uh, update both the FDA laws. So that's , uh, title 21, both of the US code and , uh, the , uh, code of Federal Regulations. Um, and , uh, uh, because of my practice in , uh, uh, government pricing and reimbursement, I thought I'll also share some updates with you on , uh, on , on that side. So, the Inflation Reduction Act , uh, for example, is a big, a big issue. Um, what Judy and I thought , uh, to , to do is just go over some of the bi bigger changes, the most significant changes that we've seen , um, from , uh, in 2023. Of course, there , there are, there are probably many different laws that affect , uh, uh, our clients or others, our listeners, in many different ways. We had to pick some that we think , uh, are , are , are , are both, you know, were important for 2023, and may have some further developments next year , um, uh, sorry, in, in 2024. Uh, and , uh, and, and beyond. Um, I will break up my personal comments , uh, into the, the more , uh, FDA focused , uh, issues. Uh , and then the more , um, more of the government pricing related issues.

Speaker 3: 6:29

Sounds good for us.

Speaker 4: 6:30

Perfect. Um, so in , um, you know, I asked some of our colleagues who work on the , uh, drugs , uh, and then some of our colleagues who work on the device side to tell me about , uh, uh, what , what were the most significant , uh, changes that they've seen. Uh, and , uh, on the, on, on the devices side, we have seen a , uh, uh, and the , a proposed rule A as recently as in October , uh, uh, with relation to , uh, lab developed tests, LDTs laboratory developed tests, which are one , a type of , uh, in vitro diagnostic. Um, uh, there , there is a proposed rule that the FDA put out in October, and it's been all the rage in , in the device community. People there . There've been a lot of comments , uh, that have been put in for , for the proposed rule . Um, so maybe I can give a little bit of a background on what, what these in vitro diagnostic tests are, just to get people , um, uh, you know , uh, uh, to help people catch up on that. Um, all I think all of us have used , uh, covid tests , uh, uh, recently. Um, uh, you know , uh, there are , there are several , uh, blood tests , uh, and other kinds of , uh, tests that are developed within a single laboratory. Uh, and they meet certain requirements , uh, certain lab requirements , uh, but there are regulations , uh, and whether they're subject to , uh, the FDA regulations , uh, has been up , up in the air. FDA has long claimed that they are implicitly covered under the device regulations, because they are device D devices. Uh, the FDA argues , um, but there had , hasn't been any , um, you know , there , there , there wasn't any , uh, specific law or regulation a clear , uh, basis for this claim. So, what the FDA has , uh, has done for several years is state that they are covered, but then cover all lab developed tests , uh, under an enforcement , uh, discretion , uh, policy. So there haven't been a lot of FDA related requirements , uh, for them , uh, in past years. So in October , uh, after many years of flipping and flopping, many years of , uh, of keeping the industry in suspense , uh, FDA , uh, uh, published a proposal. The , the , the , the actual change that it will do in our , uh, in our , uh, uh, you know , in the regulations will be just 10 words. Very, very , a very small , uh, you know , uh, short change. Um, uh, what it does is that at , uh, in 21 CFR 8, 0 9 0.3 , uh, for people who, who, who want to see the , uh, the particular regulation that'll change , uh, that regulation is the regulatory definition of in vitro diagnostic products. Um, this will , uh, include at this point , um, uh, if , if this proposed rule is finalized, it will include the words , uh, quote, including when the manufacturer of these products is a laboratory. And by those 10 words, it will , uh, include all , uh, laboratory , uh, developed tests as in vitro diagnostics. Um, once that happens , uh, the , uh, what , what the , uh, agency has said is the enforcement discretion , uh, that it has , uh, applied so far, will expire. But it , uh, the agency gives , uh, manufacturers four years until it expires. It will , um, take a little bit of time. There will be a very narrow , uh, set of en enforcement discretion policies that , uh, FDA may still maintain , uh, for some te uh, some of these tests. But by and large, after four years from , uh, the , uh, from this , uh, uh, finalized, finalized rule, if it is finalized, all lab developed tests will , uh, be subject to the , uh, device regulations such as registration and listing, pre-market review, post-market reporting, quality system regulations , uh, and, and really bring out , uh, bring that level of scrutiny from the agency to that work. And

Speaker 3: 11:09

We don't , and surprise , I , I have a question , uh, and, and I always hesitate to ask questions 'cause I, I know part of the answers . I don't wanna sound like I'm a total idio <laugh> . So, so , uh, take, take the question with, with a grain of salt. These LDTs fascinate me, frankly, because I, I understand that labs use them to develop tests and, and basically outside of the, the FDA , the long process that it takes for approvals and all of that, you know, they're really creative things you can do, but the limitations to one lab only intrigues me as well. And does that mean that that lab controls the test so it, you know, it licenses it out? Or what if it's a big, you know, I work with a lot of esoteric labs, that's the labs that do specialized testing, esoteric being kind of a euphemism, but they, they have one lab, you know, in the country. They have clients all over the United States. But what about those places that have multiple labs? Can they, can they develop an LDT in one of those and then use that for all their labs? How , how does that work in theory?

Speaker 4: 12:26

Yeah. So, you know, usually what happens with the , uh, with the LDTs , uh, the , the reason why they are carved out as, as , um, you know , uh, as, as a separate piece within in vitro diagnostics, is just to allow , uh, uh, a particular one single lab to do it. Uh, you know, the, the , this is, this is sort of a , um, just a theoretical , uh, uh, cutoff , um, in here to, to allow , uh, you know, s single labs who have been working with , uh, uh, with a particular reagent, a particular , uh, um, uh, yes reagents or , or particular diseases to, to go ahead and develop , uh, uh, these tests. But , but , you know, there , there , there might be, well, I, you know, I'm not, I don't do as much device law as some of my colleagues, but , uh, I do know that when there are , uh, multiple labs that are developing a test, the , uh, some additional regulations require , uh, uh, uh, come in. Um, for example, if there are, if there are parts of a , uh, a tests that are , um, developed in one lab , uh, and then they are shipped to other labs, there is some sort of inherent distribution that's taking place. There , there , there are some additional FDA requirements that can tack, tack onto those labs , um, uh, and FDA could have more reason for claiming jurisdiction over those when they, when they're all over the country. Um, so generally what happens is FDA has in the past kept the single lab , uh, part of this within the , um, within its definition of , uh, lab , uh, uh, laboratory developed tests to talk about this specific kind of , uh, test , uh, that , that it sees as a little bit different and historically not included within , uh, within the f frame , within the framework that it has set. Uh, yeah .

Speaker 3: 14:45

Thank you.

Speaker 4: 14:47

Yeah. So, you know, those overall , um, this, this I think is , uh, is a , uh, uh, one of the most significant changes that we have seen , uh, uh, in 2023. And I know later on we'll talk a little bit about what we will look forward to in 2024, so I can share a few more insights into how we think , uh, things will shape up , uh, uh, uh, in 24 going on. The other big piece , uh, from a , um, from an FDA point of view , uh, has been the developments in , uh, accelerated , um, the , uh, uh, this law called Fedora , um, the , um, food and drug , uh, drug Omnibus Reform Act. F-D-O-R-A was enacted at the end of 2022. Uh, so I think it was like December 29th, right at the end. So, you know, most of the implementation that we've seen for that has been in , uh, in the , uh, in 2023. Um, there , there were a couple of changes that , that made in , uh, 2023. Uh, the accelerator approvals is one that I'll talk about. And , um, uh, uh, modernizing clinical trials , uh, has been another main piece. So, accelerator approvals for drugs and biologics. The FDA has the ability to grant early approval , uh, for diseases , uh, for , for, sorry, for drugs that treat serious conditions and have , uh, an unmet medical need. Uh, so for, for such, you know, more, I, I , I would say like more severe diseases, but there's a statutory requirement on exactly what kind of , uh, diseases these can , uh, that , that can get , uh, accelerated approval. What the FDA does is review applications based on a surrogate endpoint . So we have diseases , uh, such as , uh, certain cancers , um, like Alzheimer's that develop over many years or sometimes , uh, many decades. And to do a clinical trial that looks at the ultimate clinical benefit of a drug could be, could be unfeasible , uh, to, to take them sometimes 10 or 15 years just to , uh, try and see exactly how many people achieved a clinical benefit or not. So there are some surrogate endpoints that the FDA has developed , uh, sorry, that , that, you know , uh, manufacturers have , uh, developed , uh, and , uh, you know, backed up with research and , uh, and , uh, do and , and use to submit applications to the FDA . Um, so for example, in the cancer space , uh, what one of the surrogate endpoints could be whether a tumor was shrinking or not , uh, uh, by the time that , uh, you know, the , uh, it , it was , uh, it was measured. So , uh, the , uh, you know, the manufacturer , uh, says , uh, that these markers like the shrunken , um, tumor , uh, where is a predict, you know, is a surrogate endpoint and will can predict , uh, clinical benefit. The condition for getting an accelerated approval, though, is that , uh, the drug sponsor must commit to conducting one or more post-approval studies. Uh, some studies have, you know, so sometimes what it is, it's the study that's, that's going on that's extended , uh, uh, beyond the approval date . Sometimes it's new studies that need to be done. But you know, what event , what ultimately needs to be done is that the cl , the clinical benefit of efficacy needs to be , uh, confirmed in these trials. A couple of years ago , uh, in 2021 , uh, there was an Alzheimer's drug that was approved. Uh, even though the advisory committee and a lot of experts , uh, in , uh, the Alzheimer's space said that the data just was not there, it wasn't strong enough that we should not , uh, the FDA should not have approved it. Uh, and the, the , the accelerate it , it was approved under an accelerated program. So, since then , uh, and sometimes even before then , uh, you know, the entire program came under scrutiny. So in 20, at the end of 2022, Congress made some , uh, changes in , uh, in the law , uh, uh, uh, it gave , uh, FDA the ability to , uh, hold , uh, drug clinical trial sponsors , uh, to more accountability in going through with these , uh, with these , uh, you know, post-approval , uh, studies , uh, and gave them , uh, a few more , uh, enforcement powers. So I can go into a little bit more details, but , uh, wanted to just , uh, uh, stop over here and check , uh, Judy , um, you know, there , there , there are like , uh, uh, is there some more background that I can share , uh, on this , um, uh, on the program in general before getting into some of the more details?

Speaker 3: 20:43

Well, I'm just wondering if the accelerated process was, in some respects, a response to the , um, debacle , uh, with the Alzheimer's drugs that, that were approved, and one thing and another. Yeah . And maybe you can just tell , tell us the short version of that story and where things stand now . Yeah . I mean, there's also reimbursement connotations. Um ,

Speaker 4: 21:08

That's right. Yeah. Yeah. So the accelerated , uh, uh, approval program has been around , uh, for a long time. Uh , but yeah , you're absolutely right. These changes , uh, many believe , uh, were a direct result of , uh, all the scrutiny that the FDA faced , uh, around that, what happened is the , um, when , when the FDA reviewed , uh, the , uh, application for this , uh, Alzheimer's drug, there were, you know, there were , there were some , uh, uh, some , uh, issues , uh, that they , that the reviewers , uh, uh, revealed or, or, or , yeah. In , in that review, they revealed, they talked about, they discussed some issues with the data where, you know, the , uh, full effect efficacy was not shown, or the efficacy , uh, was , uh, clear only in a smaller subset of the , uh, p uh , research subjects. So, when , uh, they looked at it as a whole , uh, the advisory committee looked at , uh, uh, the , uh, application as a whole , uh, they did not think that this is , uh, something that, that should be approved. However, there was , uh, you know, there were other reviewers that had , uh, some positive , uh, uh, data that, that they saw. And overall, the agency decided that this would be, that this , this is something that should be, that should be approved. Uh, and, you know, with the accelerated approval program, they thought that some of the data that was missing could probably , uh, be ga uh , gathered , uh, and will show up a , as this trial continues after , uh, uh, until , uh, the , uh, uh, until the, the drug gets a full approval. Um , but , uh, experts and other critics , uh, of the FDA said that, look, there , there just isn't enough for this drug to go out and , uh, start patients to start , uh, getting , um, get , getting treated by it, especially because the drug also had a very , uh, high cost. Um , so , uh, a lot of payers, just like you said, from the reimbursement side, a lot of payers looked at the data themselves and said, Hey, you know what? We just don't think that the data is there. Uh, we don't want to pay , uh, for this , uh, when we don't think that it will be efficacious for the patients that it's prescribed to . Uh, so what ended up happening is , uh, the, the, a lot of the major payers said that they're , they're not going to cover it. Um , so, you know, instead of , uh, going after just that one approval , uh, uh, uh, and talking about , uh, how that thing should have been different over there, both the FDA and Congress thought it, it, it's a good time to look at the accelerated approval program as a whole, because, you know, this drug might've , uh, brought some issues to the fore. But prior to this, there were, there were other approvals that , uh, had some data that , uh, wasn't as strong , uh, as other data. And as it turns out, the post-approval, confirmatory studies , uh, were not being done , uh, uh, uh, in every instance. Uh, there were significant delays and sometimes outright failure to conduct those , uh, studies. And , uh, that started garnering a lot of criticism of the program as a whole. FDA also did not have enough powers. They just had limited options to enforce , uh, their requirement to conduct these tests , uh, so to, to conduct these trials. Um , so because of all these shortcomings of the program , uh, Congress , uh, gave FDA , uh, a little bit more , uh, authority , uh, on how it reviews the , um, uh, applications under the accelerated program, but more so how it enforces the requirement to do these post confirmation studies. So, what happens is , uh, or , or what the , uh, what fedora the law changed , uh, at the end of 2022, is that FDA can now require , uh, a manufacturer to , uh, have a post-approval study already underway prior to even getting that approval. Or , or sometimes they can say, you know, within such and such a time within a specified amount of time after approval, you have to have started , uh, this study. FDA can also , uh, or , or rather, FDA must specify conditions of what , uh, this , uh, trial should look like. So they can say, you know , uh, they can give some enrollment targets , uh, some milestones , uh, to reach and a target date for , uh, study completion. Um , uh, FDA has also , uh, can also now ask , uh, regular reports on these trials. Uh, in the past, there were some annual reports that were due . Now, the , these reports will be due every six months , uh, so that the agency can keep up with what's , uh, going on with these , uh, studies. And if the , uh, drug sponsor is not undertaking these studies with due diligence , uh, as the statute says , FDA has new enforcement powers , um, the , uh, failure to conduct a study , uh, can , uh, uh, allow FDA to initiate these enforcement. Um, and even sometimes , uh, you know, if you don't, if a drug sponsor doesn't , uh, submit one of these , uh, biannual reports, FDA can say that, you know, you're not being diligent with the study and can theoretically , um, initiate , uh, these enforcement action. Um ,

Speaker 3: 27:04

You know, there's a , there , just just to interrupt again, there's a similar concept on the Medicare side for reimbursement called coverage with evidence-based development that I think is really , um, very cool. So it's, mm-Hmm , <affirmative> it is a way I , if there's a, a drug or product that is showing real promise based on the studies, Medicare will say, okay, we will cover it. But you have to do these studies that would be specific to Medicare beneficiaries who are receiving the product, which is, is brilliant in many respects, I think, mm-hmm . Because you get a product into circulation or availability for Medicare beneficiaries much sooner, and then you can encourage demographic specific information. So you're gonna see, does this work for people in the Medicare, you know, database, demographic base , or is this something that maybe only works for 20 year olds <laugh> based on the studies as opposed to 65 year olds? So it's, again, it's, it's a way of trying to keep safety in place and efficacy, but getting things into use maybe a little bit sooner.

Speaker 4: 28:20

Yeah, and I think that that has been the point for this , um, for, for this pathway , uh, you know , um, especially for , uh, it's, it's been used a lot in the cancer space, as I was saying earlier. Uh , you know, there are, there are people who, who , who , uh, who , who need this , um, uh, and can't wait for a much longer study to be done , uh, and much , um, uh, you know , uh, for , for that sort of data to be , uh, developed , uh, after that. So it, it definitely has been very helpful for, for patients. And FDA has been trying to , uh, reach that fine balance of having things out there for patients to use, but at the same time , um, making sure that they are safe and effective enough. Um, so yeah , uh, this, this gives, this law , uh, we think will , uh, ensure that the accelerated , uh, approval program , uh, is doing what it was originally set up to do , uh, you know, to allow products to come into the market a little bit earlier. Uh, FDA has set up , uh, an intra, again, the , within the , um, within the statute , uh, it required everybody to set up a committee , uh, within the agency, a council that will look through , uh, different surrogate endpoint , uh, you know , uh, the , the agency will , uh, think about , uh, new diseases , uh, uh, that , that, that can be, that can come under this , uh, pathway , uh, uh, publish guidance on new surrogate , uh, uh, endpoints , uh, and really streamline and standardize , uh, how the , um, how the agency should move forward in this . So , uh, it's, it's, I , I think strengthening this program will allow , um, patients to get , uh, disease , uh, treatment sooner , uh, and then eventually , uh, make sure that those diseases are actually safe and effective.

Speaker 3: 30:39

So, praz , maybe I'll talk about some of the Medicare developments from , um, the last year for, and then we'll come back to you for some, some predictions on themes for the upcoming year . So, one thing I do wanna note, with respect to the Medicare sections that I reviewed, we, we originally were focused on things that would be updated in the, in the books that, that were , um, here as co-editors and to discuss. But with respect to Medicare, the regulations are often finalized. The very significant ones are finalized after those books come out. So the books are current through about May, and then of course, the, the , uh, physician fee schedule rule, the , and many of the other major rules are actually proposed and finalized after the book comes out. So, so I will say that as a caveat, you know, do check for the latest version in ECFR, but , um, as a regulatory lawyer, I use both the hard copy and the ECFR, and I think it's just in , in working with, with junior associates, I think seeing visually how things are laid out as opposed to more targeted approaches will give you a much better , uh, way to analyze issues. So with that, there, I'm gonna focus on the last year, so not the prior year up to May, but this more recent year, and the things that I think are really significant in terms of big steps forward , uh, for Medicare. And , and one thing we have to remember as well, this was the year that the PHE ended. And so there was a lot of stuff that had to be changed and not changed, and figured out what was going on with all of this. And at say , I think it , it was almost like the Y 2K with the predictions of disaster. Y 2K frame . It was too young to remember, was when <laugh> , when the millennium changed, and everyone was afraid our computers were going to, to implode somehow. And, and , uh, of course that blew over with without too much concern. And from my perspective, people have been able to, including CMAs , had been able to accept the PhD and , and move, move forward in that, frankly, seems pretty smooth. Um, some things have stayed behind, Congress has interviewed nons . But anyway, overall, I think the process has been smooth. So, from my perspective, these are the three , um, biggest developments from the last year. And, and admittedly, my practice is probably more focused on Medicare than, than maybe some people on this , um, uh, who are listening in , um, enrollment. Medicare enrollment sounds like a very dry and boring topic. It is CMSs approach now to enforcement. And so it needs to be watched very carefully each year. There are additional provisions that are coming in through enrollment that , um, need to be <laugh> factored into your strategy in terms of enforcement and compliance. So I'll give an example from this year, and that's that. Now, if an entity enters into a false, not enters into, if , if an entity goes to trial on a false claims , that case and loses , um, and, and there's an award to the government as a result of that losing, not a settlement, but an actual post-trial judgment, that that can be reasons to deny Medicare enrollment going forward. And so, you know, if occasionally I, I work in this space, and occasionally people are very , um, very convinced they can win a case, but this is just another thing you have to put in there is , you know, the cost of litigation and then the risk that you might lose if you lose, you could be kicked outta Medicare much the same way that you could be excluded. There are other provisions that were added in , um, through enrollment , um, as well, including, for example, in the hospice space that a medical director has to be enrolled in Medicare , um, and to, to sign the certificates of terminal illness. And otherwise, all of those claims will be disallowed. So these are very, the consequences here are much more than filling out a form they need to be to considered. Another thing that I think is very important this year, big step forward for Medicare, is that they are going to allow , um, additional categories of mental health professionals to be billing providers, which means they don't have to be under the supervision of someone else. They can build in their own names. This includes , um, marriage and family therapists, which in California is , um, is a very big, there , there are a lot of MFTs here in California, and this hopefully will improve access to mental health services for, for Medicare beneficiaries. So that this, I think, is just a, a huge recognition of both the need for these services and the ability of these people to provide , um, services that are needed. My, my third of my top three has to do with Medicare Advantage. And this was , um, in many respects characterized as a , um, clarification, which is always a buzzword when you look at , I won't go into that now, whenever there's a clarification, it's like a red flag to look at exactly what is, what is happening. But CMS has indicated that they are going to , um, require and expect of Medicare Advantage plans, that they will be providing services in the same way that they would be provided to Medicare part A and part B beneficiaries, which means if Medicare is , says a particular service has to be , um, performed as inpatient only, for example, that that rule will apply to the Medicare Advantage plan as well. And certain levels of practitioners, you know, if there's a requirement that a service be performed only by a physician, then that's not gonna be good enough for just some other types of practitioners. So to me, this represents a, a major , um, well, I , again, we'll go back to the CMMS word clarification <laugh>, but this, this really will constrain some MA plans in terms of their innovation and cost cutting , because they will have to provide services that are, are provided in the same manner as you would under parts A and B so far , us . I'm gonna turn back to you to talk about what you think is coming up in the next year.

Speaker 4: 37:38

Yeah. Um, and I'll, I'll try and hear more , uh, a little bit more , uh, brief because there are, as we were discussing before this call , before this , uh, session , uh, so many things that have been changing , uh, and continue to change. So, you know, I think I'll switch gears a little bit and talk about , uh, some of the changes under the Inflation reduction Act that we are going to see , uh, come in , uh, in the next , uh, year. The big theme over here is , uh, a pressure , uh, continued pressure on decreasing drug prices. There is a , uh, uh, a bill , uh, you know, there's some bills being discussed in , uh, Congress , uh, on increasing transparency in , uh, for pharmacy benefit managers. So we'll see how that , uh, uh, you know, how , how that falls out. Um, next year , uh, uh, 2024 is a , um, election year. So they , you know, they , they , we'll see a lot of , uh, back and forth in terms of , uh, which , uh, side , uh, has what plans. Um , so that's one thing to look out for a lot of the , uh, laws that were created under the Inflation Reduction Act, while also in full gear started in 2023. And we'll see some , um, uh, some of those implemented in 2024. So just , uh, you know, to to list , uh, some of them in brief Medicare , uh, drug price negotiations. Uh, the , uh, negotiation, we'll start in , um, uh, uh, in around February of next year. And the maximum fair price , uh, will , will be published in September , uh, uh, on September to first 2024. Uh, and then we'll take effect in 2026 . But you know, this, this is , uh, this will be that first , uh, set of negotiations that CMS will want to take . Mind you, there are several lawsuits that the manufacturers of the drugs that have been selected from negotiations have already filed in various , um, uh, uh, in various district courts. So we might see some changes , uh, to the negotiations program , uh, as , uh, as some of those , uh, decisions are made in court . Um, in 2023, we also saw the , uh, infl inflation , uh, penalties, the inflation rebates , uh, for Medicare's Part B and D , uh, that was set in. Uh, so some of those , uh, you know, will , will continue. Uh, uh, CMS , uh, released some revised guidance on those inflation re rebates. And just for those who do not know , uh, these programs penalize manufacturers of certain drugs that raise their prices faster than inflation. Um, we will also see continued developments on , uh, uh, uh, a , uh, uh, manufactured discount program under , uh, part D . Part D has , has a lot of changes coming in, starting in 2025. Uh, and so , uh, some of those , uh, details are being , uh, ironed out , uh, by CMS guidance. Um, finally, on the Medicaid side, again, this, this , uh, this is , uh, more , uh, for manufacturers and distributors , uh, than for , uh, practitioners and providers. There have been some major , uh, changes proposed by Medicaid , uh, uh, earlier this year , um, uh, including some , uh, price transparency laws , um, uh, uh, what's called the , uh, best Price Stacking Rule. Uh, that's, that's being proposed. Uh, and, you know, some of these questions have been up in courts also. Uh, so we'll see how , uh, uh, CMS , uh, you know, how, and whether CMS , uh, finalizes some of those rules. Uh, they did live , uh, uh, receive a lot of criticism , uh, on some of these , uh, some of these particulars. Um , so we can go into more details if we have time, but I think those are some of the things to, to look out for Medicaid final rule , uh, whether me Medicaid will finalize its rule , uh, uh, that it proposed , uh, earlier this year on the Medicaid program.

Speaker 3: 42:02

So let me just talk about my top three or four. Uh , some of them could fall into both categories and , and they dovetail with one that you, so anyway, I'm gonna go through <laugh> through my priorities here for the, the coming year, things that I am watching. First of all, CM S'S focus and DOJs as well. Um , private equity investment in healthcare just seems to be more and more pervasive , uh, even in the enrollment regulations that I mentioned. There's a discussion and things I've never seen CMS go to this extreme on quotes about the quality of care in facilities that are, that are owned or operated by PE and CMS is now requiring more transparency in terms of who's, who is in an ownership or controlling position with respect to nursing homes in particular. And there was a senate , uh, finance committee meeting , um, recently as well on , uh, regulating hospitals. So, so I'm watching this. I'm not sure if CMS is end game , because if PE was not interested in healthcare, I'm not sure who steps in to pick up , um, <laugh> pick up that role. So , um, certainly we all want quality healthcare for everyone, but I , um, uh, the folks on PE is surprising to me, and its intensity seems to grow , um, in a , in , in quite a respectable trajectory. The other thing that I am watching has to do with relationships that DOJ is looking at. Maybe this is somehow related to pe but more in the context of business structures. So MSOs , um, marketing arrangements, things of that sort where , where OIG has been looking at the end . And the OIG regs were also in my , um, purview and statutes, although there weren't many , uh, changes in that , uh, respect in the last year, but those relationships have been scrutinized for potential kickback. They all kickback arrangements, and I think we all recognize that healthcare is just changing and it's delivery , delivery process. And, and some of these structures have come up to address certain problems , um, that have come up. So related to this, and this is why I say I'm not sure if there's three or it's four, has to also do with the physician patient relationship. If you read the recent , um, and , and , and in my spare time I read indictments and complaints and things of that sort, I find them fascinating in the way to really figure out where DOJ and, and OIG are coming from on all of this. Um, there's, there's been a real focus on a need for a physician patient relationship that's more than just a physician signing off on, on , um, uh, a lab order, for example, or, or a medication order. And that is, in some respects, contradictory to a different movement going on, you know, outside of Medicare. But just in our society, which is more self-directed medical care, we have the internet and <laugh> people think they can figure out what's wrong with them or what drug they wanna try, or maybe they should be tested for a certain food allergy. Um, and the idea of the physician as gatekeeper and all of this , um, while we're talking about Medicare, which can, can direct its, you know, beneficiaries, however it wants within limits , uh, this is, this is all very, very fluid, I think at the moment. And, and with discussions of cash pay , does cash pay get you out of this concerns that you can just, you know, pick out your own lab menu and get some doctor to sign. Anyway, I think those are gonna be trends to watch, and I don't think there are clear answers as to how that relationship is going to , um, develop. And so my final one has to do with cost controls. And this sort of dovetails back with what you were talking about <inaudible> . Um, Medicare historically has not based coverage determinations on cost , and it still is not doing that directly. But the things like you're talking about with the IRA in terms of part B negotiations, and then you talk about, you know, PAMA reimbursements , uh, PAMA being lab , um, protecting access to Medicare Act, which at some point if it ever is fully effectuated, could result in, in , um, a reduction in the amounts of payment for Medicare lab tests. There are a lot of things that are going on right now where Medicare is in fact struggling with how to control these huge costs, which is a concept that historically they had not. And , and I can dig up something from 25 years ago or so that says, we do not consider costs when we think about coverage. Yes. And , and that is deeply buried <laugh> now in , in , um, in terms of, of what, what products CMS will cover and then what they will pay for. Um, so that's a real struggle, I think, for Medicare that we're gonna see. So, Raz , I think we're getting close to the end of our time. Do you have final, any final comments you wanna make?

Speaker 4: 47:47

Um, you know, I think as co-editors, we know that we have , uh, others , uh, also who cover different parts of , uh, of , uh, of the federal , uh, uh, laws and regulations. Um, we just, we, we've, we've seen how expansive , uh, healthcare , uh, uh, rules and laws are , how they touch everything from the tax code to the, to antitrust issues, to, as you talked , uh, about Medicare Advantage, Medicare , uh, uh, and, you know, FDA work. Um , things keep changing. I, I, I , uh, sometimes I keep up and it's nice to be able to talk about some of them today. Um , but you know, as , uh, most people who are listening know , uh, you know, this, this is a constant , uh, and very dynamic, constantly changing , uh, area of the law.

Speaker 3: 48:41

So I'm going to just thank you all for listening to us today. We, we very much appreciate it and hopefully you will find the book , um, book set, <laugh> set of three , um, to be useful as well. And I think I speak for frauds and, and certainly for myself. If you have questions about anything we were talking about today, feel free to reach out to us. You can find us through the A HLA directory.

Speaker 4: 49:08

Yes. Thank you everyone for listening, and hopefully we can , uh, uh, we can meet again. Thank you .

Speaker 2: 49:22

Thank you for listening. If you enjoyed this episode, be sure to subscribe to a HLA speaking of health law wherever you get your podcasts. To learn more about a HLA and the educational resources available to the health law community, visit American health law.org.