Sellers Dorsey Digest

Federal Updates

News

U.S. Surgeon General Declares Gun Violence a Public Health Crisis

• On June 25, U.S. Surgeon General, Dr. Vivek Murthy, declared gun violence a public health crisis that is directly driven by the fast-growing injuries and deaths involving firearms throughout the country. Dr. Murthy is calling on the nation to ban automatic rifles, introduce universal background checks for purchasing guns, further regulate the firearm industry, pass laws that will restrict gun use in public spaces and penalize those who do not safely store their guns. Additionally, Dr. Murthy calls for increased research on gun violence and for the health system to promote gun safety education during doctor visits (The Associated Press, June 25).
• Did you know, Sellers Dorsey’s latest white paper, “Addressing Health Equity and Support for Justice-Involved Populations” addresses violence prevention services to support victims of gun violence? Explore the white paper to understand Medicaid as a funding source for the prevention and treatment of individuals subject to violence by clicking here.

Expanded Approval of DMD Gene Therapy Could Increase State Medicaid Costs

• On June 20, the FDA announced expanded approval of the first gene therapy to treat Duchenne muscular dystrophy (DMD) in children. This approval provides an opportunity for more than 80% of patients with the condition to have expanded access to treatment. However, due to the drug’s $3.2 million list price and predicted higher sales due to increased demand from patients who can be prescribed the drug, state Medicaid program coverage could be challenging. Policymakers are currently discussing new policies to ensure Medicaid programs can afford incoming high-cost cell and gene therapies for the increased coverage (Inside Health Policy, June 21).

CMS Awards School-Based Services Grants to 18 States

• On June 25, CMS announced the 18 states awarded grants for the implementation, enhancement, and expansion of Medicaid and CHIP School-Based Services (SBS). SBS plays an important role in the health of children and provides the unique opportunity of identifying health needs and facilitating access and coverage options while in the school setting. SBS promotes health and educational equity by helping students enroll in Medicaid, connecting students’ families with Medicaid, and providing Medicaid-covered health services in school, performing Medicaid administrative activities to improve student wellness. The 18 states awarded grants are: Alaska, Delaware, Kansas, Kentucky, Maryland, Massachusetts, Minnesota, Nevada, New Hampshire, North Carolina, Oklahoma, Oregon, Pennsylvania, Rhode Island, Vermont, Washington, West Virginia, and Wisconsin. All awarded states will receive up to $2.5 million over three years and use their funds to connect children to critical healthcare services, especially mental health services, while at school (CMCS, June 25).

Federal Litigation

Supreme Court to Hear Gender-Affirming Care Case

• On June 24, the Supreme Court announced it will take up a case challenging a ban on gender-affirming care for minors for the first time. In United States v. Jonathan Skrmetti, et al., a physician and a group of anonymous transgender minors and their parents have challenged Tennessee’s ban on gender-affirming care for children. The Supreme Court will consider whether the laws constitute sex discrimination and violate the 14^th Amendment’s Equal Protection Clause. While the Supreme Court has previously ruled that prohibitions on sex discrimination also include discrimination against transgender people, it has yet to consider a case involving state law related to transition healthcare. The case will be considered in the court’s Fall term (Inside Health Policy, June 24).

Federal Court Rules Against HHS in Suit About HIPAA Violation Policy

• On June 20, the U.S. District Court for the Northern District of Texas determined that HHS does not have the authority under the Health Insurance Portability and Accountability Act (HIPAA) to forbid providers from utilizing third-party tracking technologies on their websites. The suit against HHS was initially filed in November 2023 by the American Hospital Association in response to an HHS Office of Civil Rights bulletin involving how regulated entities, such as hospitals, cannot use tracking technologies on their websites, because it would be considered impermissible disclosure of personally identifiable health information in certain situations (Modern Healthcare, June 21).

Appeals Court Largely Upholds ACA’s Preventive Coverage Mandate, Remands Birth Control and Vaccine Mandates

• The Fifth Circuit Court of Appeals largely upheld the ACA’s preventive coverage mandate in a ruling on June 21. However, the matter was remanded to the lower court to address questions on birth control and vaccine mandates. In their decision, the appeals panel sided with HHS and reversed District Judge Reed O’Connor’s previous ruling from September 2022 which prevented HHS from enforcing the preventive coverage mandate on the plaintiffs, Braidwood Management, and insurers across the country. As a result of the appeals court reversal, HHS cannot enforce the preventive coverage mandate on the plaintiffs in Braidwood Management but can otherwise enforce the mandate on other insurers. However, the appeals court agreed with Judge O’Connor that the preventive coverage mandate violates the Appointments Clause of the Constitution and ratifying the United States Preventive Services Task Force recommendations will not alleviate this violation. According to court records, 172 healthcare and consumer organizations filed amicus briefs in the case, with the overwhelming majority supporting the preventive care mandate. An appeal to the Supreme Court could be filed this summer and heard next term (Inside Health Policy, June 21; Health Payer Specialist, June 24).

Federal Regulation and Guidance

HHS Final Rule Imposes Penalties for Information Blocking

• On June 24, HHS published a final rule, that discourages information blocking by imposing Medicare reimbursement cuts on providers that knowingly prevent authorized users from appropriate use of electronic health record (EHR) data. Information blocking occurs when a provider knows that a practice is unreasonable and likely to interfere with the access, exchange, or use of EHR information. Hospitals, ACOs, and clinicians that have committed information blocking are subject to different penalties. Hospitals will have their EHR “meaningful use” status and payment incentives revoked. Critical Access Hospitals will have a 1% point cut to their Medicare reimbursements. Physicians and other clinicians in Medicare’s Merit-based Incentive Payment System (MIPS) will lose their payment incentives and meaningful use status and potentially face reduced reimbursements. Finally, ACOs and their participants who engage in information blocking can potentially be barred from the Medicare Shared Savings program for at least one year. The HHS final rule is a companion rule to a July 2023 rule that subjects technology companies and health information exchanges to fines up to $1 million for information blocking. More information can be found on the Office of the National Coordinator for Health Information Technology (ONC) website (Modern Healthcare, June 24).

State Updates

News

California Healthcare Worker Minimum Wage Increase Delayed

• Under an agreement between state legislators and Governor Gavin Newsom, a new minimum wage for California healthcare workers will be delayed until at least October 15. The deal will tie implementation of the minimum wage to the state’s finances. If the state revenue between July and September is at least 3% higher than expected under current projections, then the minimum wage will take effect in October. However, the increases could be pushed back until January 2025 if the state revenue doesn’t rise to that level. The new minimum wage is expected to cost the state $1.4 billion in the next fiscal year if implemented in January, with approximately $600 million coming from the state’s general fund (Modern Healthcare, June 24).

Registration Begins for State Medicaid-Like Program for Undocumented Immigrants in Washington

• On June 20, registration for Apple Health Expansion, a new Medicaid-like program designed to offer comprehensive health coverage to undocumented immigrants, began in Washington. Last year, legislators in the state set aside $45 million for the program and during the current legislative session, they were able to allocate $28 million more. Apple Health Expansion will cover a primary care, specialty care, dental services, pediatric services, and pregnancy and labor services, with no out-of-pocket costs or co-pays. The state’s healthcare authority plans to cap new enrollments at 13,000, so health officials urge those interested to apply as soon as possible. Coverage for the program is set to begin on July 1 (The Seattle Times, June 20).

SPA and Waiver Approvals

Waivers

• 1115(a)
  • District of Columbia
    • On June 6, the District of Columbia submitted a request to renew its 1115 demonstration to continue to reimburse institutions for mental disease (IMDs) for treatment provided to Medicaid-eligible adults with substance use disorder (SUD) and serious mental illness (SMI). The waiver renewal also continues to remove cost-sharing requirements for medication-assisted treatment (MAT) prescriptions. New components of the waiver renewal, titled, “Whole-Person Care Transformation,” include implementing pre-release services for justice-involved individuals up to 90 days prior to release as well as housing and nutrition supports to address health-related social needs. The federal public comment period is open from June 24, 2024, through July 24, 2024.
  • Nevada
    • On June 21, CMS approved the state’s new five-year 1115 demonstration titled, “Whole Mouth Whole Body Connection for Adults with Diabetes.” Nevada is granted the authority to offer a limited dental benefit to non-pregnant diabetic adults aged 21 through 64 who are enrolled in Medicaid. Participating dental providers include FQHCs across the state and Tribal Health Centers with dental clinics. The benefits include diagnostic and preventative, restorative, endodontic, and periodontic dental services. The demonstration is approved from July 1, 2024, through June 30, 2029.

SPAs

• Services
  • American Samoa (AS-24-0001, effective January 1, 2024): Temporarily suspends coverage of several otherwise covered benefits from January 1, 2024 through September 30, 2024, due to local funding constraints.
  • Delaware (DE-24-0001, effective January 1, 2024): Updates coverage and reimbursement for doula services by making them separately reimbursed pregnancy-related services.
  • Nevada (NV-24-0011, effective April 1, 2024): Adds coverage for services within the applicable scope of practice delivered by a licensed behavioral analyst, a licensed assistant behavioral analyst, and a registered behavior technician.
  • Washington (WA-24-0038, effective July 1, 2024): Removes a typographical error on page 21a of Attachment 3.1-B.
• Payment
  • Maryland (MD-24-0011, effective July 1, 2024): Increases the reimbursement rates for the state’s 1915(i) HCBS program by 3%.
  • New York (NY-24-0075, effective April 1, 2024): Extends the date for the distribution of ARPA funds for Adult Day Services through March 31, 2025.
  • New York (NY-24-0076, effective April 1, 2024): Extends the date for the distribution of ARPA supplemental funds for eligible Assisted Living programs through March 31, 2025.
  • Ohio (OH-24-0007, effective July 1, 2024): Increases payment rates for Federally Qualified Health Center (FQHC) services.
  • Ohio (OH-24-0004, effective October 1, 2024): Updates payment methodologies by allowing an incentive payment for the coverage of a private room in nursing facilities.
  • Pennsylvania (PA-24-0013, effective January 1, 2024): Updates the MA Program fee schedule to reflect the payment rates for interprofessional consultation services.

Private Sector Updates

Change Healthcare Releases Substitute Notice about Privacy Breaches

• On June 20, Change Healthcare released a substitute notice to providers and the government about privacy breaches spurred by a cyberattack back in February. However, Change Healthcare will not be notifying patients until a data review has been completed and will start by notifying individual patients for which they have address information. Change Healthcare assumes responsibility for notifying individuals about the breach unless a provider wishes to do their own notifications (Inside Health Policy, June 21).

BCBS of Texas Leases New Houston Office

• Blue Cross Blue Shield (BCBS) of Texas has planned $18 million in renovations for its newly leased Houston office building. The insurer leased a 132,000 square foot building for eleven and a half years in southwest Houston. Renovations are expected to start next month and wrap up in January 2025. BCBS of Texas already has one office in Houston which will remain open (Health Payer Specialist, June 24).

Sellers Dorsey Updates

New White Paper Available NOW: Addressing Health Equity and Support for Justice-Involved Populations

• Did you know, the U.S. has a higher incarceration rate per capita than any other country in the world? Since Medicaid is the largest source of healthcare coverage for the most vulnerable and economically disadvantaged people in the country, it has great potential to become a critical source of coverage for justice-involved populations. In our latest white paper, Sellers Dorsey experts explore justice-involved populations and what states, providers, and other stakeholders can consider to improve health outcomes. Click here to download our white paper, today!