New budget agreement includes health care policy changes, but generally shifts attention to regulatory activity through 2016 elections

Posted by Anne Phelps, on November 2, 2015.

President Obama on Monday, November 2, 2015 signed into law a two-year budget deal that sets federal spending levels through September 2017 and suspends the federal debt limit until March 2017. The House and Senate passed the bill last week. The legislation generally clears the decks of any must-pass legislation until after the 2016 elections, shifting the life sciences and health care sectors’ focus in Washington largely to regulatory activity on issues such as the 340B drug discount program, the new Medicare payment law (MACRA), and the so-called Cadillac tax on high-cost employer-sponsored health coverage.

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Long-awaited release of drug discount rule mega-guidance means hospitals need to act quickly—but think long-term

Long-awaited release of drug discount rule mega-guidance means hospitals need to act quickly—but think long-term

On August 27, the Health Resources and Services Administration (HRSA), one of the federal public health agencies within the Department of Health and Human Services, released a long-awaited draft guidance intended to clarify eligibility requirements for the 340B Drug Pricing Program. The publication of this guidance marks the beginning of a 60-day public comment period before the agency releases a final rule.

The “340B Drug Discount Program”, named for the authorizing section of the Public Health Service Act, is a US federal government program created in 1992 that requires drug manufacturers to provide outpatient drugs to eligible health care organizations/covered entities at significantly reduced prices. Pharmaceutical companies must adhere to the program’s price discount rules as a condition of their participation in Medicaid. Over the past several years, Congress, the Administration, and health care stakeholders have been attempting to balance the program’s goals of providing drug discounts to entities that serve lower income populations, while maintaining some parameters about the definitions of qualified drugs, patients, and eligible entities to limit the expansion of the program.

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HRSA Withdraws 340B “Mega-Reg”

HRSA Withdraws 340B Mega-Reg

On November 13, 2014, the Department of Health and Human Services (HHS) announced that it is withdrawing the highly-anticipated and comprehensive 340B drug pricing program (340B program) regulation (also known as the “mega-reg”) and will replace it with program guidance issued early next year through the Health Resources and Services Administration (HRSA). The “mega-reg” was designed to address key topics not fully defined in the original legislation. It was drafted earlier this year and given to the White House Office of Management and Budget in April; however, it stagnated amidst controversy and legal proceedings surrounding the HRSA-proposed orphan drug policy issued in 2013. The withdrawal of the “mega-reg” now leaves more questions than answers for covered entities as we enter into what will likely be a formative year for the 340B program.

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