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March 2017 Newsletter

In this Issue…

Notes from Joe
· Challenges and Opportunities for HTCs

Washington Update
· We Need YOU for the Alliance Washington Days!
· Trump Administration Proposes Cuts to HRSA Program: Act Today to Protect HTC Program Funding at HRSA
· Update on the American Health Care Act and ACA Repeal and Replace
· Round-up of Exceptions to the Civil Monetary Penalties (CMP) Beneficiary Inducement Provisions

Medicaid Update
· Medicaid Covered Outpatient Drug Rule Update

Alliance Reminders
· Mark Your Calendars for Alliance Meetings in 2017!
· Team Alliance Contact Information

Notes from Joe

Challenges and Opportunities for HTCs
By Joe Pugliese

The only thing that is clear about the ongoing bipartisan craziness that has engulfed Washington these days is that opportunities and challenges abound for HTCs. Challenges include:

  • Proposed cuts by President Trump to the HRSA program that provides grant funding for HTCs and enables access to 340B for FY17 (you should have received an email from me on this, which is also reprinted below);
  • The American Health Care Act (AHCA), the House Republican proposal to repeal and replace the ACA that died last week but may yet re-emerge from the ashes; and
  • Ongoing efforts by 340B skeptics to motivate Congress to enact legislation to make changes to the program.

Against the background of these threats, I’m also happy to highlight a few recent opportunities:

First, I participated in NHF’s Washington Days event earlier this month, which had a record turnout of patients, family members and others who advocated on behalf of the community. Once again, we crisscrossed Capitol Hill wearing red ties to highlight March as Bleeding Disorders Awareness Month. This year, advocates asked that four key aspects of the ACA be maintained: prohibition on pre-existing conditions exclusions, ban on lifetime and annual caps, the federal definition of essential health benefits, and protecting the Medicaid expansion. I spent the day with the Pennsylvania delegation and was pleased to hear the patients cover all the key points and add how important their treatment center is to them.

Earlier this month, ATHN released a very well done video (available here) emphasizing the importance of HTCs for people with bleeding disorders and how critical the 340B drug program is to funding the clinical care these individuals receive. We increasingly hear from individual patients and leaders in the community that they want to support HTCs. You will be hearing more on this topic in the months ahead.

Finally, there is a growing interest in Congress to regulate how PBMs conduct their business. As we have discussed on many occasions, HTCs may be unable to provide factor concentrates to our patients despite offering the best value for the patient in terms of improved clinical outcomes, better adherence and lower costs. There are a number of bills that would affect PBMs. We are currently reviewing them to see whether any would assist us in leveling the playing field.

So that we can most effectively respond to these challenges and take advantage of opportunities, we need you to participate in the Alliance Washington Days on May 4th. I’m so pleased that we have 65 people signed up to hit the Hill with us and hope that many more of you will be able to join us.

I would also be remiss if I did not give a shout out to all the social workers out there during National Social Worker Month.

Washington Update

Trump Administration Proposes Cuts to HRSA Program: Act Today to Protect HTC Program Funding at HRSA
By Joe Pugliese, Ellen Riker, Johanna Gray, and Elizabeth “Issie” Karan

Earlier this week President Trump sent to the Congressional Appropriations Committees a list of potential budget cuts to be considered for the remainder of fiscal year 2017 to offset the costs of the Administration’s priorities to increase defense spending and the building of a border wall. The list became public this morning and it includes a cut to the Maternal and Child Health Block Grant’s Special Projects of National Significance (SPRANS), which is the source of funding for Hemophilia Treatment Centers (HTCs) as well as HTCs’ point of access to the 340B program. It is not clear if the HTC grants are included in the proposed budget cuts as the list shows no details. The proposed cuts call for a $170 million reduction in both SPRANS and the HRSA Health Profession programs, which currently are funded at a combined total of $578 million.

The Trump Administration sent this proposal as Congress is working on finalizing the federal appropriations (spending) bills for fiscal year 2017, which ends September 30, 2017. The government is currently funded until April 28, 2017 under a continuing resolution (CR), which funds programs at the same levels as they were for fiscal year 2016. Key Republican leaders on the Appropriations Committees have stated their opposition to the cuts included on this list, since they are close to reaching agreement and don’t want to enact controversial cuts that might lead to opposition and a government shutdown next month.

We are still concerned that MCH/SPRANS programs are on the list for cuts and are thus under attack. It is critical that you call your Members of Congress to oppose any cuts to MCH funding to HTCs. Here’s what you need to do:

Call the Capitol Switchboard: 202.224.3121 and give your address and ask to be connected with your Senators and Representative’s offices. Once you reach a staff person or voicemail system, use the following bullets to guide your comments:

  1. Give your name and say that you are a constituent and a member of the bleeding disorders community.
  2. You are calling to oppose President Trump’s proposed cuts to the FY 2017 funding for the HRSA SPRANS program that provides grants to HTCs
  3. The national network of HTCs provides expert, comprehensive care to people with hemophilia and other bleeding disorders. Any cuts to HTC funding would jeopardize our vulnerable patient community.
  4. Please oppose President Trump’s proposed cuts to HRSA and HTCs.

Please note that HTC personnel are permitted to contact Congress in their capacity as a citizen and constituent without jeopardizing HTC grants. However, federal grant funds and program income cannot be used for that purpose. Therefore, HTCs should make sure that any staff contacts with Congress are made on their own time and with their own resources.

Please contact any of us with questions or concerns. We will update the membership as Congress makes progress on funding bills for 2017.

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We need YOU for the Alliance Washington Days!
By Johanna Gray, Ellen Riker, and Elizabeth “Issie” Karan

As Joe mentions above, we are in a time of considerable uncertainty in Washington. Fortunately, we are also in a time of considerable grassroots advocacy where more and more people are contacting Congress to tell their representatives what they believe. This is where you come in! We are excited to have 65 people from 25 states but would love to have even more people participate and states represented.

Many HTCs have questions regarding whether and how they can advocate. Lobbying is often treated like a bad word. However, personnel at HTCs ARE allowed to participate in the Alliance Washington Days, as long as the person’s travel isn’t funded by grant dollars or program income and as long as we educate Congressional members and staff rather than directly supporting or opposing a piece of legislation. Our visits focus on that educating Congress about the role of HTCs in providing comprehensive care for the bleeding disorders community and discussing how 340B program income enables that care, not lobbying, so you are safe to participate.

It’s not too late to register for the event. From the ACA to the AHCA to 340B to funding for HTCs, there is an alphabet soup of reasons why your voice and your stories about your HTC are critically important today. Please join us!

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American Health Care Act Update and ACA Repeal and Replace
By Johanna Gray

It has been a very exciting few weeks in DC as Congress has considered legislation to repeal and replace the Affordable Care Act (ACA). As you have no doubt read, the House Republican legislation, the American Health Care Act, was pulled once it became clear that there was insufficient support for the bill. Here’s what you need to know about what happened and what comes next:

Why did the American Health Care Act Fail?

In early March, House Republicans released the American Health Care Act, legislation they drafted to repeal and replace the Affordable Care Act. On the positive side, the bill did not repeal the ACA’s insurance reforms, including covering preexisting conditions, covering adult children up to age 26, and capping out-of-pocket expenses. But, on the bad side, the bill would have repealed the ACA’s Medicaid expansion, significantly reformed the financing of Medicaid, and would have reduced financial assistance (tax credits and cost-sharing reductions) for folks who need help affording their insurance.

House leaders were hoping to move the bill quickly through the legislative process and scheduled the vote for last Thursday (coincidentally or not-so-coincidentally, the 7th anniversary of the enactment of the ACA). But, the vote was postponed and ultimately canceled last Friday when there was insufficient support for the bill. No Democratic Members of Congress supported the bill and so no more than 22 House Republicans could oppose the bill for it to pass. The legislation was criticized by some Republicans in the House for not being conservative enough, but when provisions were added to the bill to garner their support, support from moderate Republicans dropped off.

Most concerning for the bleeding disorders community, the night before the final vote, House leaders added language which would have changed the essential health benefits requirement, which could significantly undermine the ban on lifetime and annual caps. Fortunately, this language was not enacted since the bill was pulled.

What Happens Next?

In his press conference after the legislation was pulled, Speaker of the House Paul Ryan (R-WI) said, “I don’t know what else to say other than Obamacare is the law of the land. It’ll remain law of the land until it’s replaced. We’re going to be living with Obamacare for the foreseeable future.” He and President Trump said that they plan to move on from health care to focus on tax reform and other issues.

This week, a number of Republicans have said that they want to continue negotiating on a bill to repeal the ACA, but there seems to be no consensus among them on the path forward. President Trump has also indicated his willingness to work with Democrats on ACA reforms. Democrats have said they are willing to work with President Trump and Republicans in Congress on more minor changes to the ACA as long as efforts to repeal the law are stopped.

The AHCA was just one piece of the Republicans’ plan to address the Affordable Care Act. HHS Secretary Tom Price has said that he plans to use his discretion to make regulatory changes to the law, but these will be more constrained since the ACA has not yet been changed. Some fear that the ACA might be purposefully undermined so as to make the law less popular and to facilitate its repeal. We do expect that states will be given more authority to change policies in their states for both private insurance and Medicaid. In fact, several states are now considering implementing the Medicaid expansion since the ACA is not expected to be repealed anytime soon, which may improve coverage for our patient population. We are closely monitoring everything happening in Congress and at HHS and will notify the membership as this debate continues.

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Round-up of Exceptions to the Civil Monetary Penalties (CMP) Beneficiary Inducement Provisions
By Elizabeth “Issie” Karan

In last month’s newsletter, I introduced several new safe harbors to the Anti-Kickback Statute (AKS) that were released on December 7, 2016, in a final rule by the Office of the Inspector General (OIG) at the Department of Health & Human Services (“Final Rule“). This article focuses on the Civil Monetary Penalties (CMP) Law and exceptions that were updated, clarified, and added under the Final Rule.

The AKS and the CMP law are intended to curtail arrangements that could result in higher costs to the federal government or compromise the quality of care provided to beneficiaries of federal and state health care programs. The CMP law prohibits offering or transferring remuneration to a Medicare or state health care program beneficiary that the person knows or should know is likely to influence the person’s selection of a particular provider, for which payment may be made in whole or part by Medicare or state health care program (the “Beneficiary Inducement CMP”). Violation of the Beneficiary Inducement CMP may be penalized by a civil fine of $10,000 per item. The OIG may initiate administrative proceedings based on a violation of the AKS or the CMP law, and/or exclude the offending party from federal health care programs.

The Beneficiary Inducement CMP prohibition has a laundry list of exceptions. In the Final Rule released in December, 2016, the OIG added, updated, and provided more information on several key exceptions.

CMP Exception for Remuneration that Poses a “Low Risk of Harm” and “Promotes Access to Care”
Any remuneration provided to patients which “promotes access to care” and poses a “low risk of harm” to patients and federal health care programs does not constitute “remuneration” under the CMP law. This exception is limited to promoting access to items and services that are payable by Medicare or a State health care program. (See 81 Fed. Reg. 88368, 88392)

Promotes Access to Care
“Promote access to care” encompasses giving patients tools to remove barriers to care but not rewarding a patient for accessing care or adhering to a treatment regimen. (See 81 Fed. Reg. 88368, 88393.) Rather, the care being promoted should improve the patient’s ability to access care and treatment. For example, under this safe harbor, if a smoking-cessation program was a payable service for a patient, a provider could offer free childcare or parking to enable attendance but not free movie tickets as a reward for attending.

However, remuneration that removes impediments to compliance with a treatment plan could constitute promoting access to care and could fit within this exception as long as the remuneration also is low risk. Examples might include access to a smartphone app or low-cost fitness tracker or gift cards specifically for an item that would monitor the patient’s health.

Low Risk of Harm
For remuneration to be a ‘‘low risk of harm to Medicare and Medicaid beneficiaries and Medicare and Medicaid programs,’’ the remuneration must: (1) be unlikely to interfere with, or skew, clinical decision making; (2) be unlikely to increase costs to Federal health care programs or beneficiaries through overutilization or inappropriate utilization; and (3) not raise patient-safety or quality-of-care concerns. (See 81 Fed. Reg. 88368, 88396)

The OIG indicates that there is a presumption that an arrangement is “low risk” if it fits into one of the other safe harbors. However, if not addressed by a more specific safe harbor, an entity asserting this exception as a defense must present sufficient facts and analysis for the OIG to determine that the arrangement promoted access to care and posed no more than a low risk of harm to patients and Federal health care programs.

CMP Exception for Gifts of a Nominal Value
Incentives that are only “nominal” in value are not prohibited by the CMP Law. As part of this rulemaking, the OIG increased the threshold for “nominal” from $10.00 per item to $15.00 per item and from $50.00 total per year to $75.00 total per year. (See 81 Fed. Reg. 88368, 88394)

Medicaid Update

Medicaid Covered Outpatient Drug Rule Update
By George Oestreich

As many of you may remember, CMS has mandated a new Medicaid pharmacy reimbursement system, which is scheduled to begin April 1, 2017. The rule requires that all covered drugs be billed at actual acquisition cost (AAC) plus a professional dispensing fee (PDF). Fortunately, clotting factor is excluded from coverage in this rule. Unfortunately, states have the option of including clotting factor and many states are taking the easy route and mandating all drugs to be reimbursed by the same formula. AAC can be determined in three ways: the state may survey pharmacy invoices; the state may use a proven formula incorporating standard pricing such as wholesale acquisition cost; or the state may use the National Average Drug Acquisition Cost (NADAC).

NADAC is determined by random voluntary sampling of pharmacy invoices, which is incorporated into a database that is then published on the CMS site every two weeks. This may then be picked up by the states and used to determine their Medicaid reimbursement. By virtue of the method by which it is created, NADAC is weeks old before it is published and may also incorporate discounts that are not accessible by all pharmacies. Recently, we have seen the NADAC sampling being sent to HTCs and their contract pharmacies. If you receive this sampling, we encourage you to contact George or Jeff prior to completing the request.

Alliance Reminders

Mark Your Calendars for Alliance Meetings in 2017!

Here is our meeting schedule for 2017:

  • May 3rd – Physicians Meeting, Washington DC
  • May 4th – Capitol Hill Day, Washington DC
  • May 5th – Spring Members Meeting, Washington DC
  • September 17th to 19th – Fall Members Meeting, California

We are looking at scheduling a Hemophilia Treatment Center introduction to 340B pharmacy programs. If you are interested in attending a program, please contact Sean at

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Team Alliance Contact Information

We work for you! Please don’t hesitate to contact any of us with any questions or concerns:

Joe Pugliese……215-439-7173
Sean Singh……727-388-7326
Jeff Blake……317-657-5913
Elizabeth Karan……202-466-8960
Roland Lamy……603-491-0853
Audra Ames……727-415-6397
Ellen Riker……202-484-1100
Johanna Gray……202 484-1100
George Oestreich……573-230-7075