President Joe Biden looks likely to ditch the previous administration’s move to create a quicker route to market for digital health products and other devices following the pandemic emergency.
After he took office on Wednesday, Biden quickly moved to freeze a raft of Trump policies, including the moves to loosen regulations on devices including digital health products.
Only last week, the FDA had posted plans with the US Department of Health and Human Services (HHS) to allow certain medical devices including “low risk” digital health apps to be exempt from its usual premarket notification requirements.
The regulatory process known as 510(k) had been temporarily waived during the COVID-19 emergency and the proposal would have made the move permanent.
It was part of a plan to create a fast route to market for products that have helped to support the US health system during the COVID-19 crisis.
The 510(k) process already gave considerable regulatory leeway for new products, allowing the FDA to wave products through to market that it found to be “substantially equivalent” to another legally marketed predecessor.
But it looks like the Biden administration is taking a more long-term view about the regulations and how they apply to digital health.
Legal experts from the law firm Hogan Lovells noted that the proposals to drop the process “fly in the face” of an action plan to regulate artificial intelligence (AI) in healthcare.
That called for an expanded regulatory framework for machine learning devices and a more careful review of products that rely on AI.
The team from Hogan Lovells said that the exemptions remain in place for seven of the devices, all of which are gloves.
But the proposal will not take effect regarding 83 other devices unless the Biden administration decides to pursue it.
Filings for the kinds of devices covered by the notice are still being submitted and accepted by the FDA and meanwhile the HHS is still accepting comments on ways to improve the premarket approval process known until 16 March.
President Joe Biden focused on the ongoing COVID-19 pandemic during his first full day in office Thursday. In doing so, he once again drew attention to home-based care and getting the current “workforce crisis” under control.
“Our national strategy is comprehensive,” Biden said during an address from the White House. “It’s based on science, not politics. It’s based on truth, not denial — and it’s detailed.”
Since taking office, the president has signed 10 executive orders aimed at expanding COVID-19 testing and vaccine availability, with an ambitious goal of 100 million vaccine doses by April. The Biden administration unveiled a nearly 200-page pandemic preparedness plan on Thursday.
Wednesday saw more than 184,000 new cases of COVID-19 infection across the U.S., according to a New York Time database. More than 400,000 people have died since the pandemic began last year.
“Things are going to continue to get worse before they get better,” Biden said.
Biden’s pandemic preparedness plan is organized around seven goals, with the first goal focused on “restoring” trust with the American people. Protecting individuals most at risk — partly by expanding access to high-quality health care — is likewise a main goal under the plan.
“Specific actions include efforts to increase funding for community health centers, provide greater assistance to safety net institutions, strengthen home- and community-based services, expand mental health care, and support care and research on the effects of long COVID,” the plan states.
Dating back to his presidential campaign, Biden has proposed numerous investments in home- and community-based services as part of his plan to “Build Back Better.”
Wednesday’s pandemic plan notes that the U.S. Department of Health and Human Services (HHS) — including the Centers for Medicare & Medicaid Services (CMS) and the Administration for Community Living — will be tasked with identifying “opportunities” and “funding mechanisms” to provide greater support for individuals receiving care at home.
The plan also says that the administration will pay “particular attention” to “the home care workforce crisis.”
Washington, D.C.-based LeadingAge was among the first aging services organizations to voice support for Biden’s COVID-19 response.
“This virus has raged out of control for nearly a year, while our community has desperately called for help,” Katie Smith Sloan, president and CEO of LeadingAge, said in a statement. “So to have the new administration lay out plans on Day 1 to put COVID at the top of its agenda is welcome and hopeful news.”
To better track vaccination progress for seniors in congregate settings, in the community and in their homes, the Biden administration is also floating the idea of new reporting measures.
For example, to increase incentives to vaccinate Medicare beneficiaries, the plan explains, CMS will evaluate how to incorporate quality measures for COVID-19 immunizations into its value-based purchasing programs, including Medicare Advantage Star-Ratings, the physician quality payment program and accountable care programs.
One of the executive orders Biden signed directs cabinet agencies to invoke the Defense Production Act to scale up production of materials needed for vaccine shots.
“In the midst of the virus spiking and community spread, we’ve been on the battlefield trying to protect older adults and workers with limited support,” LeadingAge’s Sloan said. “We hope this means the cavalry is coming, especially on testing and vaccine initiatives.”
Another executive order empowers HHS, the Department of Defense and others to provide “targeted surge assistance” to critical care and long-term care facilities, including nursing homes and skilled nursing facilities (SNFs), plus assisted living facilities and more.
The new pandemic plan follows a couple of key HHS and CMS leadership announcements made earlier in the week.
The new administration on Wednesday tapped Liz Richter to lead CMS on an interim basis during the presidential transition. The agency’s website now lists Richter, who has worked at CMS in various capacities since 1990, as acting administrator.
Former CMS Administrator Seema Verma submitted her resignation last week with an effective date of Jan. 20.
The president on Tuesday nominated Dr. Rachel Levine to serve as assistant health secretary. Levine is currently the Pennsylvania health secretary, and a pediatrics and psychiatry professor at Penn State College of Medicine.
Biden already nominated California Attorney General Xavier Becerra to serve as HHS secretary, though he — along with the administration’s eventual pick for CMS chief — must eventually be confirmed by the Senate.
The agency published its first action plan last week for how it plans to regulate machine learning-based software as a medical device. To start, the FDA said it will issue guidance on how changes to algorithms should be regulated as they “learn.”
Agency veteran Dr Janet Woodcock is the new interim FDA commissioner appointed by president Joe Biden to replace outgoing Trump appointee Stephen Hahn.
Woodcock has most recently been working with the Operation Warp Speed coronavirus vaccine and drug project started by the Trump administration.
While this work will continue, the Operation Warp Speed name has been dropped and Woodcock will take a leading role at the agency she first joined in 1984.
Dr Janet Woodcock
Holding a Bachelor of Science in chemistry from Bucknell University and a Doctor of Medicine at Northwestern University Medical School, Woodcock first served as director of the division, covering new drugs at the FDA’s Center for Biologics Evaluation and Research (CBER).
She held several other roles at CBER before being named as director of the FDA’s Center for Drug Evaluation and Research in 1994 and staying in that role until 2005.
Between 2005 and 2008 she had several other roles at the FDA commissioner’s office, including deputy commissioner, chief medical officer and chief operating officer, before returning as head of CDER in 2008.
According to press reports, the Biden administration has not yet nominated a permanent commissioner.
In a tweet, Woodcock said that she will continue to recuse herself from work relating to the therapeutics developed by Operation Warp Speed, although this does not apply to vaccines.
She added that Julia Tierney, a 12-year veteran of the agency, has agreed to serve as acting chief of staff.
It is an honor and privilege to serve as Acting @US_FDA Commissioner. The FDA’s public health work is more critical than ever as we continue to fight this global pandemic.
According to the New York Times, advisers to the Biden administration’s transition team, Woodcock is one of the candidates under consideration for the permanent position.
Insiders said that other candidates under review are principal deputy commissioner Dr Amy Abernethy and former agency official Dr Joshua Sharfstein, who is vice dean for public health practice and community engagement at Johns Hopkins University.
Hahn’s resignation is a formality as senior political appointees are expected to leave their roles when a new administration takes over.
In a farewell note to FDA staff, Hahn praised the organisation’s employees for their response to the coronavirus crisis.
He noted the scientific advances that have been achieved since the pandemic began, such as the authorisation of the first non-prescription over-the-counter coronavirus test, authorisation of the first antiviral agent and the first two FDA authorised COVID-19 vaccines.
But Hahn’s tenure was marked by miss-steps as the FDA came under political pressure from the previous administration, such as the Emergency Use Authorization for the drug hydroxychloroquine despite a lack of scientific evidence.
The U.S. Department of Labor (DOL) recently issued an opinion letter allowing home care agencies to implement consistent shift rates that include pre-payment of overtime for caregivers who provide live-in services.
In this case, a “live-in shift” is defined as being on the job for 24 hours or more at a time.
Broadly, the DOL’s opinion letter makes it administratively easier to compensate live-in caregivers. Live-in caregivers work extended periods in a client’s home, even residing there on a near-permanent basis in some cases.
Specifically, the guidance from DOL allows home care agencies to blend anticipated overtime hours worked by the end of the work week into each daily shift, before the overtime is actually earned for the week. This allows agencies to pay the same rate for each shift based on total anticipated hours.
Typically, compensation for live-in caregivers is quantified on a per shift basis, with some agencies quoting pay rates.
Contextually, the compensation process for live-in caregivers became more complicated in 2015 after regulators decided to eliminate a previous live-in exemption, Angelo Spinola, co-chair of the home health and home care industry group at law firm Littler Mendelson, told Home Health Care News.
“[Live-in caregivers] were paid a flat day-rate, and there wasn’t a lot of concern or consideration as to how many hours they were actually working,” he said. “The law changed. But the industry didn’t change for a while, and you still have companies that are unaware of what it is that they need to do to be compliant.”
Getting an opinion letter from the DOL on this matter was the result of ongoing legal efforts from Littler Mendelson, which represented a group of home care providers.
Spinola called this effort a good example of the home care industry working together to get in front of an issue.
“More than ever, this industry has been working together on these sorts of projects to proactively attack and address issues that have hounded the industry for years,” he said. “This was a small group of providers that pooled resources to achieve this result that will be useful and helpful for the entire industry. We are seeing that in multiple states.”
For providers, the DOL’s new guidance supplies definitive answers on how to compensate live-in caregivers. When handled incorrectly, this was a process that potentially spelled legal trouble for providers.
“There have been so many attorneys who have brought class-action lawsuits on behalf of live-in caregivers — making the argument that the shift-rates are impermissible day-rates,” Spinola said.
Lowering the risk of future litigation against home care providers could result in more companies offering live-in services.
Amid the COVID-19 public health emergency, the demand for live-in services has grown, with more seniors opting to shelter in place.
Spinola pointed out that, in the past, some clients have shied away from offering live-in services at their home care agencies to avoid legal challenges.
For home care agencies looking to start providing live-in services, setting them up the right way will be the key to success, according to Spinola.
“You have to understand what the rules and requirements are in your jurisdiction, in your state,” he said. “Have a live-in agreement that explains those rules and expectations on the caregiver side and on the client side, so the client understands how many hours they have contracted for.”
Spinola noted that agencies have run into trouble when trying to reverse engineer rates without regard to the actual time that was worked.
Wage-and-hour litigation, confusing state-level regulations and an increase in federal audits were among the biggest legal trends of 2020. While many of these issues will remain in the year ahead, 2021 will also bring several more legal hurdles for home-based care providers.
The decision of whether to mandate COVID-19 vaccinations for home health and home care workers is toward the top of that list. Other emerging legal battles that will shape 2021 include telehealth dos and don’ts.
To keep in-home care operators in the legal loop, Home Health Care News reached out to four attorneys who specialize in the field. The group of legal experts offered their take on the biggest focus areas of 2021.
Their responses are below, edited for length and clarity.
* * *
An enormous challenge home care and home health providers face is remaining compliant with the myriad of federal, state, and local laws and regulations that continue to change at a record pace. It is critically important that providers have a comprehensive legislative tracking process and adopt proactive compliance strategies to both identify changes and modify their policies and procedures to conform appropriately. Providers that operate in multiple jurisdictions or states are especially confronted with this challenge.
One of the most straightforward examples is ensuring compliance with the payment of varying minimum-wage rates. The federal minimum wage is currently $7.25 per hour. However, the Biden administration will likely seek a $15 federal minimum wage. Many states already require a higher minimum wage, such as Colorado’s $12.32 requirement. Some states — such as California — have local jurisdictions, each with its own unique minimum wage requirements that often depend on the number of employees within a given business.
Another major trend to watch out for is the enactment of Domestic Workers Bills of Rights (DWBRs) across the nation. These laws provide specific requirements that employers within a given jurisdiction must adhere to with regard to minimum wages, overtime wages, discrimination and harassment complaints, training requirements and much more. Last year, Philadelphia became the 10th jurisdiction to enact employment legislation to protect domestic workers — and some may recall the federal DWBR legislation sponsored by Kamala Harris in 2019.
We can anticipate a revival of that effort under the Biden administration.
— Angelo Spinola, co-chair of the home health and home care industry group at Littler Mendelson
* * *
If I had to pick one legal issue to watch in 2021, it would be health care payment and coverage reform. While the Affordable Care Act was enacted over a decade ago, its wake continues to make waves in the health care sector. Legal challenges remain unresolved in the courts. Twelve states have not expanded Medicaid. Over 10% of Americans remain uninsured. Federal agencies continue to use their broad regulatory authority to push providers toward value-based reimbursement.
With the inauguration of Joe Biden, I anticipate seeing significant efforts to build on the ACA and, potentially, legislative attempts to expand coverage. While Democrats will control the White House and both chambers of Congress, their razor-thin margin in the Senate makes “Medicare for All” proposals unlikely.
Although the regulatory proposals have been overshadowed by recent events, the Trump administration has proposed or finalized rules that could have a significant impact on provider payment and oversight. A significant theme in 2021 will be the extent to which the Biden administration alters or replaces those rulemaking efforts
As we emerge from the pandemic — hopefully soon — federal and state governments and private payers will examine the many regulatory waivers and flexibilities granted during the public health emergency. Which ones will stay? Which will go? Only time will tell.
— Matt Wolfe, partner at Parker Poe
* * *
2020 shined a spotlight on the importance of home health care, as in-person doctor visits were no longer accessible to seniors and facility-based providers dealt with depleted resources and fewer available beds. As access to services dwindled and remote care began to flourish, a massive inequity affecting home health care was revealed.
Remote care services are frequently not reimbursable in a home health setting — and any home health visits delivered via telehealth do not count toward LUPA thresholds during an episode of care. That policy essentially punishes these home health providers that use telehealth to supplement in-person care. In an environment swiftly moving toward value-based outcomes and technology-driven efficiencies, this disparity became evident to policymakers, who are now working toward a remedy.
For those companies who rely on fee-for-service income, the motivation to transform businesses using new technologies will continue to lag unless we figure out a way to increase financial incentives to enable such transformation. We should expect to see innovative home health companies form or participate in value-based enterprises under the newly published Anti-Kickback Statute safe harbors as a way to compensate for the current lack of reimbursement for virtual services.
— Rebecca Gwilt, partner at Nixon Gwilt Law
* * *
The first half of 2021 will keep providers occupied with getting their employees and patients vaccinated. The pandemic has caused, in many respects, the reduction of home care hours as patients are concerned about aides bringing COVID-19 into the home.
The vaccine offers providers the opportunity to reassure their patients that the aides are not bringing the virus into the home. In turn, it’s a way to increase hours. Therefore, we anticipate that providers will launch wide-scale efforts to get their workers vaccinated. This will involve helping the caregivers understand the importance of being vaccinated and, in some cases, conditioning future and continued employment on the employees’ agreement to become vaccinated.
— Emina Poricanin, managing attorney of Poricanin Law
The European Union has approved the coronavirus vaccine from Moderna, leaving the UK trailing because of changes to post-Brexit drug approval rules.
With the UK reeling from one of the worst outbreaks of the disease, it’s a worrying situation for one of the countries worst hit by the pandemic that is relying on vaccines to bring the virus under control.
The UK is in a national lockdown that could last into March, with more than 62,000 new cases and 1,000 coronavirus-related deaths recorded yesterday as a more transmissible strain threatens to overwhelm the country’s health service.
As things stand, the two rival mRNA-based vaccines from Pfizer/BioNTech and Moderna are now approved for use in the EU.
Meanwhile in the UK, the Pfizer/BioNTech and AstraZeneca shots have been quickly approved.
The UK government has an order for just 7 million shots of the Moderna vaccine covering just half a percent of the population, while the European Commission has secured 160 million doses, enough to cover around 18% of the population.
US-based Moderna said that first deliveries of the vaccine in Europe will begin next week.
Moderna’s vaccine is arguably the most effective approved so far at around 95%, while AstraZeneca’s rival that has been swiftly approved in the UK ahead of Europe works in around 62% of cases when given its recommend dose.
The Pfizer/BioNTech seems to be of comparable efficiency to the Moderna shot, and is being rolled out across the UK along with the AZ vaccine.
There is evidence to suggest the AZ vaccine’s efficacy could be improved to 90% by giving a half-dose to start with, but UK regulators have not been given sufficient evidence to approve this formulation.
After a rolling review began of Moderna’s vaccine late last year, the European Commission has issued a conditional marketing authorisation the day after it was backed by regulators from the CHMP scientific committee.
Moderna has said it is in talks with the UK regulator over approval, where European Commission decisions on medicines no longer automatically apply because of Brexit.
Under Brexit transition arrangements the Medicines and Healthcare products Regulatory Authority (MHRA) will continue to adopt decisions by the European Commission on medicines.
In usual circumstances companies are required to submit an identical filing request to the MHRA after a CHMP positive opinion
The UK regulator would then follow the decision of the European Commission, which nearly always rubber-stamps the CHMP’s decision within a few weeks.
But on this occasion the process has not been possible because of the accelerated timelines for vaccine approval because of the pandemic.
Questioned by pharmaphorum, the MHRA was unable to comment on arrangements for the Moderna vaccine at the time of writing.
However Moderna said separately that it is in talks with the MHRA to get the vaccine approved.
The FDA approval process is slow. Even for COVID-19 vaccines, the process can be time consuming. However, regulators around the world do have some expedited programs. However, a number of countries have programs that expedite review, particularly for the diseases with unmet need, orphan drugs, or when new treatments represent a significant advance over the standard of care. Wang et al. (2020) summarizes some of these programs as follows:
Facilitate development and expedite the review of drugs to treat serious conditions and fill an unmet medical need
Expedite review of drugs with the potential for substantial improvement over available therapy
Regenerative Therapy Advanced Designation
Includes all benefits of fast track and breakthrough, includes early interactions with FDA
Priority Review designation
FDA goal is to make a decision on the application within 6 months
Conditional market authorization
Available for medicines that address unmet medical needs where the benefit of immediate availability outweighs the risk of a less comprehensive review
Approval under exceptional circumstance
Marketing authorization in absence of comprehensive data that cannot be obtained even after authorization
Priority medicine (PRIME) designation
EMA scheme to support development of medicines that target and unmet medical need
Time limited, conditional market authorization
Marketing authorization conditional on further data. Conditional approval may last a maximum of 7 years
Program aiming to accelerate the application of innovative drugs for serious and life-threatening diseases
Regenerative medicine specific orphan drug designation
Allows subsidy to cover direct expenses of the development and authorization of orphan products indicated for serious diseases with high medical needs
Designation means that Pharmaceuticals and Medical Devices Agency (PMDA) review time is reduced to 9 months(from a standard 12 months review)
The article discusses in detail some of the regulatory rules for gene therapy approval. At the time the article as published, 7 gene therapies had received marketing authorization. These are:
Glybera (alipogene tiparvovec). Approved for familial lipoprotein lipase deficiency under exceptional circumstance in Europe.
Imlygic (talimogene laherparepvec). Approved for unresectable melanoma in Europe under standard approval (with additional monitoring) and in the US through a fast track approval.
Strimbelis (autologous CD34+ cells transduced to express ADA). Approved to treat severe immunodeficiency due to ADA deficiency in Europe under standard approval (with additional monitoring).
Yescarta (axicabtagene ciloleucel). Approved for B-cell lymphoma under PRIME in Europe and under a breakthrough therapy designation and priority review in the US.
Luxturna (voretigene neparvovec). Approved for the treatment of retinal dystrophy under orphan designation with additional monitoring in Europe and breakthrough designation/priority review in the US.
Kymriah (tisagenlecleucel). Approved to treat acute lympblastic leukemia (ALL) and diffuse large B-cell lymphoma (DLBCL) under PRIME in Europe and under breakthrough designation/priority review in the US.
Zolgensma (onasemnogene abeparovovec-xioi). Approved to treat spinal muscular atrophy in Europe through conditional marketing authorization with additional monitoring and in the US under breakthrough designation/priority review.
Even after marketing approval, payers must determine whether they will cover these treatments. The authors conclude their article on this latter issue as follows:
Various approaches have been adopted by different countries to mitigate the potential risk of reimbursing gene therapies with substantial uncertainties surrounding long-term outcomes. Payers generally have expressed openness to such innovation. However, it is questionable how they will react and deal with the continuously increasing number of gene therapies seeking market access.
BioNTech CEO Ugur Sahin has said that it is “highly likely” the company’s COVID-19 vaccine will work against the more infectious strain circulating in the south east of England, although further studies will be needed.
Sahin was addressing a news conference after the vaccine was approved by the European Union, three weeks after the shot was independently backed by the UK’s regulator.
The variant has caused concern globally, prompting dozens of countries to close travel borders with the UK to prevent it from spreading.
There is no evidence to suggest the new strain causes more serious illness, but it does show variations in the “spike” protein that the virus uses to infect cells – the same protein that the Pfizer/BioNTech shot uses to confer immunity.
Sahin said: “We don’t know at the moment if our vaccine is also able to provide protection against this new variant.
“But scientifically, it is highly likely that the immune response by this vaccine also can deal with the new virus variants.”
Proteins on the UK variant are 99% the same as on the prevailing strains and BioNTech has “scientific confidence” that the vaccine will be effective.
“But we will know it only if the experiment is done and we will need about two weeks from now to get the data,” Sahin said. “The likelihood that our vaccine works … is relatively high.”
It would take around six weeks to adjust the vaccine for the new variant in a worst-case scenario, although regulators would likely have to approve the changes before the vaccines could be used.
The UK Medicines and Healthcare products Regulatory Agency (MHRA) is reportedly close to a decision on a rival vaccine from Oxford University and AstraZeneca and may make a ruling in the coming days.
The MHRA begun a rolling review of the vaccine early in November, around the same time as it began to review Pfizer’s shot.
It is thought the review has been delayed by the range of results produced by the vaccine, after a manufacturing error led to the accidental discovery that an initial half dose of the two-shot vaccine seemed to produce stronger protection.
Feature image copyright BioNTech SE 2020, all rights reserved
In late November, the aging-focused advocacy organization LeadingAge wrote a note to Congress, calling for relief on behalf of the 5,500 adult day service providers across the country and the vulnerable patients they serve.
“Adult day services providers across the country urgently need dedicated federal funding to ensure they are able to continue providing services during and after the COVID-19 pandemic ends,” the letter read.
It was signed by LeadingAge President and CEO Katie Smith Sloan and Donna Sizemore Hale, the executive director of the National Adult Day Services Association.
Unlike other health care providers across the care continuum, adult day providers haven’t been the benefactors of any major funding from the federal government. Meanwhile, state mandates have kept adult day operators completely closed, or opened at just 30% or 50% capacity.
A lack of government relief and a major loss in revenue due to limited capacity or complete closures has left the adult day world in deep trouble.
“I think we definitely do need to appreciate that operating at 30% to 50% capacity — or whatever the capacity limit is — is going to have a huge financial impact on any organization over a long period of time, whether they are adult day operators or a business in any other industry,” Brendan Flinn, the director of home- and community-based services at LeadingAge, told Home Health Care News.
Operators are prioritizing safety as they open. That frequently means reopening at reduced capacity, which means a reduced bottom line as well — and sometimes an unsustainable one.
It also means additional expenses, even with a greatly reduced number of members. For smaller adult day operators, those expenses consist of purchasing safety equipment such as PPE and plexiglass in lower quantities — and, thus, at higher prices.
LeadingAge’s letter to Congress included an asking price of $422.5 million to support providers and the over 260,000 individuals they serve.
Worst of all, a lack of support means that the vulnerable individuals that frequent adult day centers are left behind. Reduced capacity squeezes out members in need of care and socialization.
“I was on a call with some of my providers last week that had recently reopened, … and they were talking about their members, and how they had lost a ton of weight, how they’ve declined cognitively,” Flinn said. “Whatever health conditions they had, they had been exacerbated.”
Those providers had also reported that once they had reopened and welcomed members back, all of those aspects had begun improving.
But that’s for the ones lucky enough to return to adult day centers amid the ongoing public health crisis. For the ones that haven’t, those conditions are likely to continue worsening, bringing stress to them and their families.
Adult day centers are a great resource for lower- and middle-income families. They offer care and socialization to seniors at an often lower, more feasible price.
According to Genworth Financial, the 2020 national median cost of adult day services was $1,603 per month. Comparatively, the assisted living cost was over $4,300 per month, while nursing home care was about $7,750.
“It’s similar to anything else we’ve learned from data, research or anecdotal reporting … we’re seeing the effects to a greater degree for lower-income families and communities,” Flinn said. “We know that adult day services are a great way for [these] families and individuals to receive some type of services if they are not eligible for Medicaid and can’t afford something like a nursing home, but need some sort of care.”
The distribution of funds
It’s not that the Provider Relief Fund, for instance, cut out adult day providers. Instead, it’s that once those funds were released to the U.S. Department of Health and Human Services (HHS), the agency did not include them among the providers who would receive relief.
Phase Two of the Provider Relief Fund — for the most part — was the only phase that adult day providers were able to access. Even then, it was designated for providers that had billed Medicaid, and resources were extremely limited.
“These funds were turned over to HHS, and it made the decision about where those funds went,” Flinn said. “So [HHS] were the ones who decided that Phase One would include Medicare Part A, they were the one that decided what providers would get what type of relief.”
So, if there is another relief package coming down the pike, it’s likely to be distributed the same way. And that would still likely leave adult day providers behind. Some states have been better than others when it comes to adult day relief funding, but it has not been enough to make up for the lost ground from a federal standpoint.
To make matters worse, in the recent and initial federal recommendations for vaccines, adult day providers and their members were not included in the highest priority group.
The Framingham, Massachusetts-based company was founded in 2014 by home health veterans Kara and Ken Harvey.
The Harveys were set to begin growing their business by franchising locations in Massachusetts and Florida, offering discounts for potential franchisees. The couple hoped to add 10 in 2020.
“Adult Day is — and is going to be — a very preferred long-term care option,” Kara Harvey told HHCN. “And so before the pandemic hit, we had many people throughout the country interested in joining the franchise system, and then that halted.”
The Harveys have noticed the recession sparking more interest from entrepreneurs of late, but have held back on opening up a slew of new locations given the uncertain regulatory climates in the two states. While they recently opened a new Elder-Well location, they’ve fallen short of their aspirations for obvious reasons.
Adult day centers were also labeled non-essential in both Florida and Massachusetts.
“That was painful,” Harvey said.
In Florida, however, they were allowed to open back up in May. In Massachusetts, adult days weren’t allowed to reopen through the summer.
Elder-Well wasn’t eligible for larger Paycheck Protection Program (PPP) loans. And because it is a social model that does not receive money from Medicare and Medicaid, the only way they were able to recoup some revenue during the public health emergency was to offer virtual solutions.
“It was difficult, I think, for all service providers in the senior care industry, but particularly for adult day,” Harvey said. “Those that weren’t able to pivot instantly and set up a virtual option really took a hit.”
Elder-Well has leveraged a partnership with the cognitive assistance company MapHabit, as well as Zoom and Facebook Portal, to stay in touch with its members.
After keeping its head above water virtually in 2020, the company has tempered its expectations. Now, it hopes to open six locations in 2021.
“Whether it be a social or a medical model, adult day centers are key in order for seniors to continue living at home in each community,” Harvey said. “There needs to be more insight provided for the lawmakers to understand that, and to appropriate funding and support for programs.”
Reviewers from the FDA have given their blessing to the Pfizer/BioNTech COVID-19 vaccine ahead of a key meeting tomorrow – but the regulator noted that there are still uncertainties about whether the shot can stop the disease from spreading.
The gist of a briefing document published from FDA reviewers ahead of an expert advisory board meeting is that the vaccine is good to go.
But there are still unanswered questions that can only be addressed once the shot is administered to the wider public.
Thursday’s vote of the Vaccines and Related Biological Products Advisory Committee is non-binding – but the FDA seldom takes a different viewpoint from its experts when it makes a final regulatory decision.
Pfizer and BioNTech are asking for an Emergency Use Authorization of their vaccine based on phase 3 data, which can be converted into a full licence at a later date once further trial information is published.
Phase 3 trials are designed to test whether vaccines are safe and effective and in this regard FDA reviewers said in the document that the Pfizer/BioNTech vaccine is a success, effective in around 95% of cases and with “favourable safety profile”.
The most common adverse reactions seen in a trial cohort of 38,000 patients were at injection sites (84.1%) followed by fatigue (62.9%) and headache (55.1%), and serious adverse reactions occurred in 0% to 4.6% of participants.
There were four cases of Bell’s palsy – a sudden muscle weakness – in the vaccine group and none in a placebo arm.
However the FDA noted there are currently insufficient data to make conclusions about the safety of the vaccine in subpopulations such as children less than 16 years of age, pregnant and lactating women, and those with compromised immune systems.
The biggest issue for the FDA staffers is one that will only be resolved with time – whether or not the shot can prevent people from infecting each other.
Reviewers said that “additional evaluations including data from clinical trials and from vaccine use post-authorisation will be needed to assess the effect of the vaccine in preventing virus shedding and transmission, in particular in individuals with asymptomatic infection”.
Reviewers noted there was no evidence of “vaccine-enhanced disease” but whether the vaccine could lead to a more resistant strain of the virus emerging is also unclear.
The regulator will be keeping a watching brief on this as more study data emerges over the course of the pandemic.
This risk “needs to be evaluated further in ongoing clinical trials and in observational studies that could be conducted following authorisation and/or licensure,” reviewers said.
Hospitals in the UK have already begun immunising high-risk patients after the country’s regulator became the first in the world to approve the Pfizer/BioNTech vaccine last week.
President-elect Joe Biden has picked Xavier Becerra, the current attorney general of California, to lead the U.S. Department of Health and Human Services (HHS), according to several news reports.
Prior to serving as California’s top prosecutor, Becerra represented the Los Angeles area in Congress for 12 years.
HHS is currently headed by Secretary Alex Azar. Before Azar, the role of HHS secretary was held by Tom Price, who resigned in 2017 amid scrutiny of his travel spending.
Moving forward, Becerra must be confirmed by the Senate after Biden’s Jan. 20 inauguration in order to take over his post. The role will place him at the forefront of efforts to stop the spread of COVID-19 — both in the general community and across the operations of America’s in-home care providers.
A record 101,487 COVID-19 patients hospitalized on Sunday, according to the COVID Tracking Project.
In other moves from the Biden transition team, Harvard infectious disease expert Dr. Rochelle Walensky was picked to head the U.S. Centers for Disease Control and Prevention (CDC), the Associated Press reported Monday. Biden also announced a new advisory role for Dr. Anthony Fauci, the government’s top infectious disease expert.
When Becerra previously served as a senior House Democrat, he became known as a staunch defender of the Affordable Care Act.
While Becerra would certainly bring different ideas and approaches to COVID-19, in-home care and health care in general, the switch to a Biden administration is unlikely to create major shockwaves for providers, industry leaders have previously told Home Health Care News.
“I haven’t seen any evidence or indicators where I’d say [a Biden administration would be] ‘drastically different,’” LHC Group Inc. (Nasdaq: LHCG) Chairman and CEO Keith Myers previously told HHCN. “I think Democrats tend to lean into provider-based care. They’re not as much in favor of Medicare Advantage as Republican administrations, in my view.”
New Mexico Gov. Michelle Lujan Grisham and former Surgeon General Vivek Murthy were previously rumored to be potential picks for HHS secretary in the incoming Biden administration.
Murthy was recently nominated to once again take over as surgeon general.
Bureaucracy, political upheaval, and lack of regulations continue to make Latin America a difficult market for European and North American pharma to enter – and COVID-19 has only worsened these issues. Developing market specialist Dr Zulf Masters OBE takes us through the nuances of being successful in this region.
Having worked all around the world to supply medicines to developing markets, Dr Zulf Masters understands the biggest barrier for a pharma company entering these regions is a lack of understanding of their complexities.
His company, UK-based Masters Speciality Pharma, partners with big pharma, SME and biotech companies to bring their products to patients in developing markets. Although Latin America is a vast and varied region, it is one that, generally, presents difficulties for the industry as access to treatments is limited.
“There are a number of companies that, even in the last decade, have left the Latin American market completely because they just couldn’t handle the local nuances, such as devaluation of currencies, economic problems, political issues, the bureaucracy and, dare I say, quite a lot of corruption,” Dr Masters says.
Political issues in some countries are among the most conspicuous challenges in the region, and Dr Masters says they continue to “create havoc”.
“Sometimes this havoc can cause a huge swing in economic issues and lead to significant losses if you’re not careful.
“For example, during the impeachment time of Dilma Rousseff in Brazil, business with public healthcare completely dried up. We had to be nimble and move very quickly to start working with HMOs and the private sector to remain profitable.”
Thankfully, many governments are working towards emulating systems from other countries to make their healthcare systems more robust. For example, price regulations are becoming more common in Latin America, often being based on models such as NICE’s.
“Companies from North America and Europe tend to be used to thinking in fairly logical systems – but in Latin America, bureaucracy is not always logical”
“Several countries have brought in regional harmonisations and regulations, and the regulatory environment is becoming increasingly sophisticated and complex,” says Dr Masters. “Our medical and regulatory team have started teaching partners all over Latin America to embrace developing world regulatory and pharmacovigilance tactics and programmes.”
However, increased regulation can be a double-edged sword – they increase safety and efficacy but can also make access to medicines more difficult in many markets.
“National budgets are squeezed because drugs like new biologics are very, very expensive,” says Dr Masters. “National budgets are not used to spending $84,000 per patient per year for just one person who has hepatitis C. They are becoming very, very selective in what they can import.”
As a result, Latin American countries often end up importing products from cheaper but less-regulated markets like India and China, leading to some counterfeit medicines being introduced into the supply chain.
“It’s a big task for people like us in the industry to educate these systems and explain what they’re doing wrong,” Dr Masters says.
These regulations have also resulted in many essential COVD-19 products becoming unavailable in Latin American countries.
Colombia’s recent price regulations, for example, resulted in a lack of products like Midazolam, an anesthesia for people on ventilation.
“Because the price regulations are so drastic, many companies who had registered products like Midazolam had left the country by the time COVID came,” Dr Masters explains.
He adds that the pandemic has brought to light the fragility of healthcare systems in the region.
“Governments and individuals have found out that pandemic strategies are not easy to handle when you have very draconian bureaucracies in place. Locking down ports and airports added additional problems because most of these companies, even those who manufacture locally, have to depend on APIs coming in from China and India. The entire supply chain was disrupted, and the cost of logistics often increased tenfold.”
But like in other regions, healthcare systems are finding innovative ways to get around the unique problems posed by COVID.
“In countries like Brazil, where many people live in poor areas far away from centres of excellence or clinics, telemedicine and remote consultations have become very important. That trend is likely to accelerate.”
Dr Masters says that many of these issues can best be sidestepped by industry and government working together.
“It has to be an almost symbiotic relationship where we’re helping each other out and showing governments the right way to do things. We need to encourage them not to take paths that will lead to more counterfeit medicines entering their markets, because they will never come back from that.”
Dr Masters believes that having a local presence and employing local people can help companies better understand the cultures and economies of these regions.
“Companies from North America, Europe and other developed areas tend to be used to thinking in fairly logical systems,” he says. “In Latin America, bureaucracy is not always logical. It’s important to be well-informed, adapt yourself and find the right partnerships.”
He uses the example of sickle cell disease product Siklos, which Masters was attempting to bring into Brazil.
“The product was already registered by the FDA, but the Brazilian regulators decided they were above the FDA and started asking questions that were often irrelevant.
“Sickle cell disease patients in the Northeast of Brazil are generally poor and in desperate need of this medication, but the country will drag its feet and put up roadblocks.
“Health authorities and governments will have to rethink their strategies and reduce the barriers to entry if this situation is to improve.”
Similarly, Latin America is not part of many smaller biotech companies’ business models when they are first starting out, but partnering with companies local to the region that are organised according to EU/US laws can derisk the venture and help expand access beyond what they would normally be able to achieve.
“At Masters, for example, we do a lot of market research into disease areas and disease prevalence, and even do some local clinical trials if needed. Then we feed this information back to the company, and when the product is registered by the FDA we will look at licensing it into our markets and registering them locally.”
But Dr Masters says he is confident that the market will change.
“There are many emerging markets in Latin America who are always looking to North America and Europe as being the standard-bearers of drug regulation, and they are changing the way they think based on what they’re seeing there. They’re talking to those people to see how they can regulate their prices properly and equitably.”
The industry has an important role to play in helping these governments in this transition.
“Helping facilitate these discussions and connections, providing education and conducting local trials are all steps the industry can take to help open up these markets even further for other companies.”
About the interviewee
Zulf Masters, CEO of Masters Speciality Pharma, started his career back in 1980 working at Beecham as a medical rep, moving into international sales and marketing for certain emerging markets. This gave him the idea of founding Masters in 1984 to address the unmet patient need in emerging markets. The company began by serving the Caribbean from a single location from where, as Founder and CEO, Zulf has led Masters into becoming a truly international business. Masters Speciality Pharma is today a global pharmaceutical company, headquartered in the UK, with a 35-year successful track record in supplying medicines to hospitals, clinics, and government organisations in more than 75 countries.
This is the question that a recent paper by Chorniy et al. (2020) attempt to answer. This issue is clearly very relevant as the UK recently has approved the Pfizer/BioNTech vaccine for COVID-19 before the US. Unlike most studies that attempt to examine the relationship between FDA review time and R&D investment dollars, the authors aim to measure the relationship between FDA review time and number of drugs in the pipeline. Whether the former is probably a better measure of R&D investment efforts, the latter is what society cares more about.
The dependent variable is the number of drugs in the pipeline for indication category, and the key independent variable is the natural log of the FDA review time for drug category C. The drug pipeline data comes from AdisInsight and the review time comes from the [email protected] database. The regression also controls for whether the drug is receives priority or orphan status (also from Drugs @FDA), the development cost and the market size. The development cost is endogenous so the authors use the number of pages in an NDA submission, the number of Phase III clinical trials and the Phase III trial sample size. The vector of market characteristics include disease mortality and morbidity (from World Health Organization data by disease), all‐payer drug expenditures (from the Medicare Expenditure Panel Survey, MEPS); number of drugs on the market (also from MEPS); and drug prices (from Express Scripts/Medco and Redbook).
The authors find that:
The average FDA review time for drugs approved after 1999 is 466 days, or about 1.3 years, but …it takes anywhere from 46 days (Eloxatin) to 1827 days (Prialt) for a drug to complete the review process that gives a drug a green light to be marketed. Post‐PDUFA, many NDAs were eligible for a special review status. About a half of the drugs in our sample received a priority review status, and about 20% were classified as orphan, on average by disease category.
Using the regression specification described above, they also find that longer review time decreases the number of drugs in the pipeline.
A doubling of the review length is associated with approximately six fewer drugs in the development pipeline in that disease category. This implies that a one‐sixth increase in review length is associated with approximately one fewer drug in development; with a mean review length of 466 days, this implies that each 78 extra days of review are associated with one fewer drug in development.
One challenge of this study is that pipeline decisions are made years in advance. Thus, longer review time may also impact the decision for early phase drug development, but the data the authors use is from a fairly limited time period 1999 to 2005. Given that the drug development timeline is typically more than 10 years, this study estimates the impact over a relatively short time period. The study also ignores the regulatory process in other countries as well, and their impact on drug development. While the US is the largest pharmaceutical markets, the regulatory environment in other countries–particularly in Europe–may affect investment decisions.
Nevertheless, it is clearly logical that additional regulatory burden and delays in time to market clearly do affect this study does contribute to pharmaceutical firms investment decisions. Budish et al. (2015) find that firms often invest in oncology indications for late stage disease because the time for trials to read out is much shorter. To expedite the FDA review process, in 1992 Congress passed the Prescription Drug User Fee Act (PDUFA) which allowed the FDA to charge fees to pharmaceutical firms to expedite the review process. These payments fund just under half of all drug reviews.
This study does add to the literature on how pharmaceutical firm R&D respond to incentives. For instance, Acemoglu and Linn (2004) found that a potential market size affects affects the number of new drugs that get to market. Other studies have found that higher profits boost pharmaceutical firm R&D investments, for instance the advent of Medicare Part D (Blume-Kohout and Sood 2013) and changes in patent law (Williams 2017). Perhaps the best-known paper–Dubois et al. 2015–found an elasticity of innovation with respect to market size of 0.23, suggesting that $2.5 billion of revenue is required to bring a new drug to market based on drug development costs. The paper by Chorniy et al. (2020), despite some limitations, helps add to this literature.
Pfizer and BioNTech are preparing to deliver their COVID-19 vaccine to the UK after the country’s drugs regulator became the first authority in the world to approve it.
As predicted by pharmaphorum, the regulator was able to move faster than its counterparts from the European Medicines Agency, who are also conducting a separate review of the data.
Pfizer and BioNTech have an agreement to supply the UK with 40 million doses of the vaccine, which is called BNT162b2 and was shown to be 95% effective in a phase 3 trial.
The companies said they will take immediate action to begin delivery of the vaccine and the first doses are expected to arrive in the country over the coming days, with the entire tranche expected to be complete next year.
Distribution will be prioritised – the Joint Committee on Vaccine and Immunisation has already set out priority groups who will receive the vaccine.
There are 11 groups, with older adults living in care homes and care home workers in the first group and those aged 80 years of age and older and health and social care workers second on the list
Delivery will begin throughout 2020 and 2021 to ensure fair allocation of the vaccines across different areas.
Another issue will be the logistical challenges of storing the RNA-based vaccine at around -70C and sending it out to clinics and GP surgeries across the country.
Danny Mortimer, chief executive of the NHS Confederation, which represents organisations across the healthcare sector, said there are still questions that need to be ironed out to support the delivery process.
Mortimer said: “This is the starting klaxon for people readying to deliver the vaccine. What’s ahead will be a marathon and not a sprint, with many months ahead to vaccinate everyone who needs it.
“This welcome news, however, does not mean that we are immediately out of the woods.
“Our already-stretched NHS faces a monumental effort now to roll-out the vaccine quickly and effectively.”
Nevertheless the UK health secretary Matt Hancock tweeted that “help is on its way” after the announcement.
Help is on its way.
The MHRA has formally authorised the Pfizer/BioNTech vaccine for Covid-19.
The NHS stands ready to start vaccinating early next week.
The UK is the first country in the world to have a clinically approved vaccine for supply.
Earlier this month the UK became the first country in Europe to pass 50,000 deaths from the coronavirus.
Transmission rates have fallen in the last month but only because of another economically crippling national lockdown, which has cost thousands of people their livelihoods as businesses struggled to survive.
Pfizer’s CEO Albert Bourla said: “As we anticipate further authorizations and approvals, we are focused on moving with the same level of urgency to safely supply a high-quality vaccine around the world. With thousands of people becoming infected, every day matters in the collective race to end this devastating pandemic.”
The MHRA is not the first national regulator to approve a coronavirus vaccine – that accolade goes to the Russian regulator, which backed the “Sputnik V” vaccine developed independently by a team in Moscow.
But this is the first approval based on phase 3 data as the Russian vaccine was only licensed on an interim basis after a review of earlier clinical data.
Other regulators are also reviewing the Pfizer/BioNTech vaccine, including the FDA, and the MHRA is also reviewing data rivals from Moderna and AstraZeneca/Oxford University.
Over the past several years, it seems as though the home health industry has been inching closer and closer toward the elimination of Medicare’s strict physician-certification policy. Now — thanks to the CARES Act — nurse practitioners (NPs), physician assistants (PAs) and clinical nurse specialists (CNSs) are able to certify eligibility for home health.
Home health industry insiders have long been vocal about Medicare’s physician-certification policy — a rule many see as antiquated and overly rigid. Generally, those critics argue the policy created roadblocks that made it more difficult for older adults to gain access to home health care, in turn impacting providers’ bottom lines.
Before the CARES Act, home health services had to be certified — and recertified — by a physician. That process often resulted in heavy delays, especially when physicians were busy.
PAs, in particular, are fairly autonomous in terms of their ability to practice. They are often not in the same location as the physician with whom they collaborate or work with, according to Michael Powe, vice president of reimbursement and professional advocacy at the American Academy of PAs (AAPA).
“For that reason, it’s important for PAs to have the ability to take care of the complete range of services their patients need,” Powe said. “If you’re a PA in a satellite clinic, that might be 25 miles away from the collaborating physician. You don’t want to have to run to that physician to have them sign-off on a certification for home health.”
AAPA is an Alexandria, Virginia-based nonprofit advocacy organization that represents more than 131,000 PAs across the U.S.
When patients aren’t able to get home health care services in a timely manner, those delays drive up costs and result in negative health outcomes.
“They may be in another situation, such as being in a hospital for an extra day or two if can’t get the home health services they need,” Powe said. “That simply runs up the cost of health care for the entire system. If those [home health services] aren’t being provided in a timely manner, then you’re more likely to have a patient who suffers an adverse medical consequence.”
The CARES Act was an attempt to course correct and avoid those issues. It pulled from the April 2019 Home Health Care Planning Improvement Act, which previously sought to give NPs, PAs and CNSs the ability to certify home health permanently.
“It makes it a much more manageable relationship between the home health agency and the attending practitioner for the patient,” National Association for Home Care & Hospice (NAHC) President William A. Dombi told Home Health Care News. “Everything from the original plan of care, to changing orders, to signing the documents on a timely basis in order to then submit and get payment — it really reduces some administrative and care roadblocks.”
Despite federal regulations, there are a number of state-level challenges that stand in the way for NPs, PAs and CNAs.
For example, the scope of practice for NPs is an issue in some states. NPs are divided into two classes: independent practice and collaborative practice with a physician. Less than half of states allow for full, independent practice, according to Dombi.
Meanwhile, most states require PAs to work under the supervision of a physician. PAs are allowed to take on the tasks of ordering care and certifying eligibility, provided that supervisory status exists.
Another issue comes by way of licensure in the states, according to Dombi.
“[About] 35 states have full-blown licensure for home health agencies,” he said. “That licensure generally is fashioned consistent with the Medicare Conditions of Participation (CoPs). While the [CoPs] for Medicare have changed, states have to take the step of changing and updating their own licensure standards to mirror those.”
Another challenge comes from the Medicaid side. There are many states where the Medicaid payment rules need to be updated to allow for a practitioner — and not just a physician — to authorize plans of care and certify eligibility.
Dombi pointed out that the issues surrounding Medicaid payment rules and state CoPs likely have more to do with timing, meaning state governments may just be slow to catch up with federal changes, than a difference of opinion in regard to policy.
On the flip side, Dombi stresses that the scope of practice issues are more serious.
“Some states may never allow non-physician practitioners to have independent practice, and that’s within the state authority to do so,” he said.
As things stand, larger providers that run multi-state operations will have the major task of figuring out the rules and regulations in each state.
“They definitely carry a lot of risks, if they think that a non-physician practitioner can do everything in all of the states,” Dombi said. “Having to manage that on a state-by-state basis creates a burden, of sorts, for them. If you’re in a single state, as a small company, find out what the rules are — and follow them.”
Moving ahead, Dombi believes advocacy will continue to be important to help get state policies to catch up with federal law.
“We’ve worked with many of the state home care associations, which are taking the step to do that,” he said. “Those voices within home health care and the non-physician practitioner community have to step up … and initiate the advocacy to make that happen.”
Overall, 30 states have recently taken temporary or permanent actions to authorize NPs to order home health services. In the last week alone, both California and New Mexico updated their regulations to permanently authorize NPs to order home health services, according to the American Association of Nurse Practitioners (AANP).
Austin, Texas-based AANP is a national advocacy organization that represents the interests of more than 270,000 NPs.
So far, NAHC has worked with state associations in Massachusetts, New York and California, according to Dombi.
Additionally, organizations such as NAHC, AAPA, the American Academy of Home Care Medicine, LeadingAge, Visiting Nurses Association of America and others collaborated on a letter addressed to the National Governors Association, encouraging policymakers to recognize the federal change and provide flexibility.
In an effort to boost value-based care, the U.S. Centers for Medicare & Medicaid Services (CMS) recently announced that it has finalized changes to the Physician Self-Referral Law — often referred to as the Stark Law.
For home health providers, the changes could mean more opportunities for value-based care arrangements moving forward, experts believe.
Broadly, the Stark Law was originally intended to prevent physicians from self-dealing and making compromised medical decisions based on financial incentives.
Under previous rules and regulations, physicians were prohibited from making referrals for “certain designated health services payable by Medicare to an entity with which he or she has a financial relationship.” In some instances, this meant home health providers.
In CMS’s statement announcing the recent change, the agency called the law an “outdated” regulation that “burdened” health care providers during the U.S. health care system’s shift toward quality.
“These reforms under the Stark Law and Anti-Kickback Statutes are historic reforms and come as part of the regulatory sprint to coordinated care that I led over the past few years,” said U.S. Department of Health and Human Services (HHS) Deputy Secretary Eric Hargan. “Too often, ‘sorry, Stark’ or ‘can’t do it, AKS’ have been watchwords in American health care.”
In value-based care arrangements, physicians and other care providers typically form interdisciplinary teams to manage patients as their needs change, sometimes sharing upside and downside risk. Discouraging a physician from referring within that internal team makes little sense.
There has long been an effort to make changes to the law, Matt Wolfe, a partner at law firm Parker Poe, told Home Health Care News.
“Since the enactment of the statute, there have been a whole host of different regulatory efforts to better define and narrow the scope of the law, recognizing that there are a number of times where it would be appropriate for a physician to refer a patient to designated health care services,” Poe said.
Other legal experts echoed those sentiments.
The update to the Stark Law now creates exceptions that make room for innovation and value-based compensation structures, according to Danielle Sloane, a health care attorney at Bass, Berry & Sims.
“For home health agencies that want to participate in value-based arrangements, I think it provides more avenues to work together with hospitals and physician groups — and to share in the savings from any efficiencies,” Sloane said. “[It provides more avenues] to share in the bonuses from a quality perspective.”
Additionally, CMS provided guidance on requirements of the exceptions to the Stark Law and technical compliance requirements.
Still, Sloane warned that despite the flexibility the changes provide, it’s important for home health providers to continue to devote time and energy to compliance. First and foremost, providers must ensure they have appropriate arrangements with physicians.
“There are certainly some flexibilities here for those ‘oops’ scenarios, but I don’t think it changes best practices of making sure you have a contract in place,” she said.
The overall impact of the update will depend on things ranging from existing arrangements with physician practices, health systems and payers, but most providers will be impacted in some way, according to Wolfe.
Similar to Sloane, Wolfe stressed that providers should take inventory of their existing contractual arrangements.
“Even though one of the goals of this regulatory action is to reduce regulatory burdens, I think, in the short run, providers are going to have to put some resources into making sure that their current arrangements comply with the new iteration of the laws and regulations,” he said.
In an effort to increase hospital capacity amid the current COVID-19 surge, the U.S. Centers for Medicare & Medicaid Services (CMS) on Wednesday announced “unprecedented” flexibilities around providing hospital-level care for patients in their homes.
Similar to CMS’s recent allowances surrounding telehealth, the agency’s latest efforts are focused on lifting barriers that could potentially hinder care during the public health emergency, CMS Administrator Seema Verma said in a statement.
Wednesday’s flexibilities aren’t coming out of thin air. Instead, they build off the success and learnings of the nation’s existing hospital-at-home models, pioneered by organizations like Johns Hopkins and Mount Sinai.
“With new areas across the country experiencing significant challenges to the capacity of their health care systems, our job is to make sure that CMS regulations are not standing in the way of patient care for COVID-19 and beyond,” Verma said.
Through CMS’s “Acute Hospital Care At Home program,” eligible hospitals will be granted “unprecedented” and “comprehensive” regulatory flexibilities to treat certain patients in their homes. The agency clarified the new flexibilities are aimed at acute care in the home and very different from “traditional home health services.”
In addition to building new capacity, CMS’s program is also a means to support established hospital-at-home programs, which have mostly had to rely on payment mechanisms outside of the Medicare fee-for-service world. CMS believes that with proper monitoring and treatment, acute conditions such as asthma, congestive heart failure, pneumonia and chronic obstructive pulmonary disease (COPD) can be treated in the home setting.
Wednesday’s move received praise from Dr. Bruce Leff, a hospital-at-home expert and the director of the Center for Transformative Geriatric Research at Johns Hopkins University School of Medicine.
“CMS made a terrific decision in recognizing the value of hospital-at-home care for the public health emergency,” Leff told Home Health Care News in an email. “Hospital-at-home is well proven to provide high-quality hospital-level care in patients’ homes for many acute conditions — and patients and their families love it.”
Similarly, the move drew applause from Contessa, a company that helps organizations provide hospital-level care in the home through its Home Recovery Care model.
“Given the tremendous strain COVID-19 is putting on our health care system, access to home hospital care has never been more important,” Travis Messina, CEO of the company, said in an email. “The teams at CMS and CMMI expertly executed this hospital-driven model. Hospital-level care requires appropriate clinical oversight from hospital leaders.”
Messina added that his team is “thrilled” Mount Sinai Health System, one of Contessa’s partners, was already approved for CMS’s new model due to its extensive experience with the hospital-at-home concept.
Under the program, participating hospitals will be required to implement screening protocols prior to delivering care in the home. Participants will need to screen for both medical and non-medical factors, including working utilities, assessment of physical barriers and screenings for domestic-violence concerns.
Participating hospitals will also need to provide in-person physician evaluation before starting care in the home.
Additionally, a registered nurse is required to perform evaluations on each patient — in person or remotely — daily.
“Acute Hospital Care at Home is for beneficiaries who require acute in-patient admission to a hospital and who require at least daily rounding by a physician and a medical team monitoring their care needs on an ongoing basis,” CMS noted.
Wednesday’s announcement from CMS has roots in its Hospitals Without Walls program, which was first established in March. CMS’s Hospitals Without Walls program loosened regulatory restrictions in order to enable hospitals to provide services in other settings.
Over the years, the hospital-at-home model has gained a reputation for providing better outcomes at a lower cost. Despite this, the model has still mostly existed as a niche service line for providers in the U.S.
Recently, the COVID-19 emergency has served as a catalyst for renewed interest in the model.
Currently, Brigham and Women’s Hospital, Huntsman Cancer Institute, Massachusetts General Hospital, Mount Sinai Health System, Presbyterian Healthcare Services and UnityPoint Health are being approved for CMS’s new program.
“We’re at a new level of crisis response with COVID-19, and CMS is leveraging the latest innovations and technology to help health care systems that are facing significant challenges to increase their capacity to make sure patients get the care they need,” Verma’s statement continued.
The FDA has approved Alnylam’s gene silencing drug Oxlumo, the first treatment for primary hyperoxaluria type 1 (PH1), an ultra-rare and life-threatening genetic disorder.
Oxlumo (lumasiran) was also approved in the European Union last week, making it the third from Alnylam’s pipeline of RNA interference therapeutics to make it to market.
The approval will mean that Alnylam has a clear run at this small but potentially profitable niche market, as the nearest rival from Dicerna is further back in the pipeline.
Patients with PH1 produce far too much oxalate, a substance consumed in food and produced by the body.
This combines with calcium to cause kidney stones and deposits in the kidney, which can lead to kidney failure and the need for dialysis.
As the kidney function worsens, oxalate can build up and damage other organs including the heart, bones and eyes.
The disease is also difficult to diagnose and often takes around six years before doctors correctly identify it.
Oxlumo works by targeting hydroxyacid oxidase 1 mRNA that codes for the enzyme glycolate oxidase.
Preventing the body from producing this enzyme has the knock-on effect of reducing the synthesis of oxalate.
There was no immediate announcement from Alnylam about pricing – but it’s likely to be eye-watering given the rarity of the condition.
Alnylam’s Givlaari, FDA-approved a year ago for acute hepatic porphyria, costs $575,000 per year at full price in the US, although after discounts the figure is more likely to be in the region of $442,000 per year.
In Europe, the company said it will reach separate pricing deals with each member state as quickly as possible.
Although the company has broken new ground with its technology, it is not yet profitable and saw its losses increase in Q3 to more than $253 million, worse than last year’s Q3 loss of $208.5 million.
Alnylam is hoping that revenue will stream from its new products and payments from Novartis, which owns the rights to cholesterol lowering drug inclisiran.
Alnylam licensed inclisiran to The Medicines Company, which was bought last year by Novartis for $9.7 billion.
Given the incredible speed in which vaccine development for COVID-19 is occurring, it merits thinking back on the typical development and approval time of previous vaccines. Puthumana et al. (2020) reviews 21 vaccines approvals since 2010. They find that:
…most novel vaccines approved by the FDA required about 8 years of clinical development and were based on evidence from a median of 7 clinical trials, including at least 2 pivotal efficacy trials that were randomized, masked, and used a comparator group. These pivotal efficacy trials enrolled a median of 5000 patients, who were followed up for serious adverse events for at least 6 months. Given the urgency of developing a COVID-19 vaccine, trials will need to be larger than those supporting prior vaccine approvals and include sufficient follow-up time for emergence of adverse effects.
Bringing a COVID vaccine to market in 1-2 years would be a remarkable accomplishment given previous vaccine development timelines.
COVID-19 vaccines could be approved and available early next year in the UK ahead of European countries, after its national regulator began its own rolling reviews of shots from AstraZeneca and Moderna.
AstraZeneca has confirmed that the UK’s Medicines and Healthcare Products Regulatory Agency (MHRA) has begun a fast-track rolling review of its AZD1222, the COVID-19 vaccine it developed in conjunction with Oxford University.
This followed last week’s news that the MHRA has begun a parallel rolling review of a rival from Moderna.
The rolling review allows for a real-time assessment of the clinical data from clinical trials, accelerating a process that normally takes around a year to complete using the centralised European regulatory system.
Using the MHRA could allow the UK to make regulatory decisions on COVID-19 vaccines ahead of the European system, where medicines and vaccines are first reviewed by the CHMP scientific committee before being passed on to the European Commission.
But a source close to process told pharmaphorum that it is “eminently possible” that the MHRA could reach its conclusions ahead of its European counterparts as the country reaches the end of the Brexit transition period.
A spokesperson for the MHRA said that from 1st January, it will have new powers to approve medicines, including vaccines including “greater flexibility to do this faster, while maintaining the highest standards of safety, quality and effectiveness.”
The spokesperson said: “The MHRA will evaluate the data rigorously on the quality, safety and effectiveness of COVID-19 vaccines to reach a scientifically robust independent opinion if an earlier authorisation is necessary before the EMA (European Medicines Agency) authorises a product.”
“Patient safety is our top priority. The independent Commission on Human Medicines will advise the UK government on the safety, quality and effectiveness of any potential vaccine. No vaccine will be deployed in the UK unless stringent standards have been met through a comprehensive clinical trial programme”
Representatives of the MHRA used to sit on the CHMP but no longer participate as a result of Brexit, leaving the UK to make its own decisions on medicines regulation should it choose to do so.
According to the source, COVID-19 vaccines could be available in early January depending on the length of time it takes for trial data to be published and shared with regulators.
COVID vaccines are being developed at warp speed, with the development and review process that normally takes up to a decade to complete compressed into less than a year after research began at the end of January.
The MHRA’s approach to the AZ and Moderna vaccines also paves the way for similar fast reviews to rivals from the likes of Pfizer/BioNTech and Novavax, which the UK government also has on order and are reaching the end of the clinical trial process.
The news comes as the country prepares for another national lockdown, which will disrupt business and limit people’s freedoms for at least another month.
A vaccine is seen as a potential way out of the cycle of lockdowns that have already caused severe hardship across the UK, which is one of the countries worst hit by COVID-19.
An AstraZeneca spokesperson told pharmaphorum: “Results from the late-stage trials are anticipated later this year, depending on the rate of infection within the communities where the clinical trials are being conducted. It is then up to the regulatory bodies to review and make approval decisions based on this data, as quickly as possible.
“The EMA announced in October that its CHMP had started a ‘rolling review’ of data for AZD1222, the first COVID-19 vaccine to be evaluated under these arrangements. We confirm the MHRA’s rolling review of our potential COVID-19 vaccine.”
The U.S. Centers for Medicare & Medicaid Services (CMS) released its final home health payment rule for CY 2021 on Thursday, with essentially no changes to the Patient-Driven Groupings Model (PDGM) or its controversial behavioral adjustment.
In addition to doubling down on PDGM, boosting the home health base payment rate by 1.9% and making minor adjustments to the Home Health Value-Based Purchasing Model, CMS also clarified its new policy on Requests for Anticipated Payment (RAPs) for next year and beyond.
Home health agencies likely won’t be happy with the fine print.
In its 2020 rulemaking, CMS announced it was moving forward with a plan to fully eliminate RAPs — or home health-prepayments that provide a chunk of an episode’s anticipated payment at the beginning of care — by 2021. In place of RAPs, the agency explained it will instead require agencies to submit a one-time Notice of Admission (NOA) starting in 2022.
Although NOAs kick in for 2022, 2021 would be a transition year, with agencies still required to submit a watered-down RAP for billing purposes.
“With the removal of the upfront-RAP payment for CY 2021, we relaxed the required information for submitting the RAP for CY 2021 and stated that the information required for submitting an NOA for CYs 2022 and subsequent years would mirror that of the RAP in CY 2021,” CMS wrote in Thursday’s final rule. “Starting in CY 2022, [agencies] will submit a one-time NOA that establishes the home health period of care and covers all contiguous 30-day periods of care until the individual is discharged from Medicare home health services.”
While the elimination of pre-payments is already incredibly impactful, especially for smaller, cash-strapped home health agencies, CMS’s new policies also come with a built-in penalty for late submissions.
The RAP in 2021 and the one-time NOA starting in 2022 must both be submitted within five calendar days from the start of care. If agencies fail to do so, they’re subject to a one-thirtieth reduction to the wage and case-mix adjusted 30-day period payment amount for each day from the start of care date until the date agencies submit their RAP or NOA.
In other words, home health agencies will be hit with a 3% fine for each day they’re late filing their paperwork.
The fine print
A 3% fine for each late day to file a RAP or NOA doesn’t seem too bad at first glance. But that 3% fine turns into a 20% penalty very quickly.
After issuing its proposed rule in June, CMS received multiple comments from industry stakeholders asking when the non-timely payment reduction actually begins.
“A commenter requested clarification on the methodology used to calculate the non-timely submission payment reduction,” CMS stated in its 2021 final rule. “This commenter asked whether the reduction begins on Day 1 or Day 6.”
For purposes of determining if a “no-pay” RAP is timely-filed, the no-pay RAP must be submitted within five calendar days after the start of each 30-day period of care. For example, if the start of care for the first 30-day period is Jan. 1, then the no-pay RAP would be considered timely-filed if it is submitted on or before Jan. 6, the agency clarified.
What’s that mean? Well, in the event that the no-pay RAP is not timely-filed, CMS will calculate the one-thirtieth penalty from the first day of that 30-day period. So in the previous example, the penalty calculation would begin on Jan. 1 — and not on Jan. 7, the first day after an agency misses its deadline.
Translation: If an agency submits its no-pay RAP one day late, the result would be a 20% reduction to its 30-day payment amount.
“That will take these small agencies out,” McBee Associates President Mike Dordick told HHCN in July 2019.
A possible 20% penalty on top of that just adds insult to injury.
Cheating on your taxes
The RAPs penalty is an important detail from CMS’s final payment rule for next year, but the main takeaway is still the agency’s decision to stick to PDGM’s behavioral adjustment — effectively a 4.36% cut if left unmitigated.
Industry stakeholders were hoping CMS would reconsider the adjustment after emerging data suggested it’s inherently flawed but exacerbated due to the COVID-19 pandemic. The adjustment has proven difficult for many agencies, particularly when paired with astronomical personal protective equipment (PPE) costs and other factors.
“Our members have been working hard throughout this health care crisis to serve older adults in need of home health care, while at the same time shouldering significant pandemic-related expenses for PPE, staffing and other needs,” Katie Smith Sloan, president and CEO of LeadingAge, told HHCN in an email. “They’ve cared for older adults both in person and via telehealth, despite shortcomings in Medicare reimbursement policies that keep providers from being paid for delivering telehealth services.”
Those facts, coupled with CMS’s decision to not address faulty behavior assumption adjustments in its rule for CY 2021, put home health agencies in “an untenable position,” she added.
In addition to her role at the Washington, D.C.-based aging services industry association LeadingAge, Smith Sloan also serves as acting president and CEO of ElevatingHOME and the Visiting Nurse Associations of America.
In part, PDGM’s behavioral adjustment was based on CMS assuming home health agencies would do everything possible to lower Low Utilization Payment Adjustment (LUPA) rates while always “upcoding” to the highest-paying primary diagnoses.
Intrepid USA CEO John Kunysz told HHCN that line of thinking was wrong from the start.
“Maintaining the behavioral adjustment is akin to the government saying, ‘We believe you are going to cheat on your taxes, so we are disallowing a percentage of your deductions,’” Kunysz said in an email. “We operate in a highly regulated environment. The incentives to provide appropriate care far outweigh any temptation to try and game the system.”
Dallas-based Intrepid USA is a home health, hospice and home care provider with operations in more than a dozen states. In 2019, the company cared for more than 22,000 patients under its home health service line.
In response to ongoing opposition from both lawmakers and providers, the Department of Health and Human Services (HHS) recently announced it has made changes to its rules surrounding COVID-19 relief funding.
The department’s amended rules now allow providers to use Provider Relief Fund (PRF) money toward lost revenue that’s potentially unrelated to COVID-19.
“After reimbursing health care-related expenses attributable to coronavirus that were unreimbursed by other sources, providers may use remaining PRF funds to cover any lost revenue, measured as a negative change in year-over-year actual revenue from patient care related sources,” HHS said in a recent statement.
Before the recent update, HHS placed a stricter stipulation on what would eventually amount to $175 billion of funds provided through the CARES Act stimulus package. This was to prevent providers from becoming more profitable in 2020 than 2019 by improperly using federal funds for financial gain instead of an operational lifeline.
While the PRF program was “well-intentioned,” it has been mired with challenges associated with conflicting and unclear guidance along the way, Matt Wolfe, a partner at law firm Parker Poe, told Home Health Care News.
“In September, when HHS put out guidance that seemed to limit or restrict these provider relief funds, there was understandably a significant amount of pushback by providers and members of Congress,” Wolfe said. “When [HHS] created this program under the CARES Act, they were really trying to make sure that health care providers of all stripes were able to respond to the public health emergency and keep their doors open.”
Since its formation, the PRF has accomplished its goal of keeping home health agencies and other afloat, Wolfe believes. Still, over the past couple of months, there had been growing concern that HHS was becoming more restrictive than what Congress originally intended.
“You’re putting providers in this difficult situation of saying, ‘Well, I needed this money because it’s what allowed me to make it through this unprecedented challenge,’” he said. “At the same time, they’re wondering, ‘If I retain the funds and don’t pay them back, am I going to have some potentially large obligation down the road?’”
HHS’s amendment to the reporting requirements is key because it clarifies whether providers should hang on to the funds.
While certainly an improvement for home health agencies, and “a step in the right direction,” there’s still work that needs to be done to accomplish the Congressional intent of the program, according to Wolfe.
“For example, it allows a provider to be able to show lost revenue attributable to the coronavirus, essentially by looking at 2019 patient-related revenue compared to 2020 patient-related revenue,” he said. “Depending on your operations in 2019, you may have had an acquisition or some other type of growth at the beginning part of 2020. You may have actually still lost revenue that isn’t dissipated revenue in 2020, but that simplistic comparison of 2019 to 2020 may not actually show that.”
As more providers retain funds, the industry will likely also see an increase in federal oversight.
Since providers are dealing with federal dollars, there’s the possibility of False Claims Act liability, according to Wolfe.
Moving forward, it will be critical for providers to receive clarity in order to continue to make informed business decisions.
“There’s a lot still to be determined in terms of how you’re going to comply with these reporting requirements,” Wolfe said. “Some of the decisions about how to report are going to influence how you spend the money. It’s really critical that HHS provides that clarity so that providers can make decisions about how to utilize these funds if they haven’t already.”
The HHS to loosen the Provider Relief Fund rules marks the second significant relaxation of rules around federal support for health care providers in recent weeks.
The Centers for Medicare & Medicaid Services (CMS) also extended repayment terms for its Medicare Accelerated and Advance Payment Program earlier this month.
The 21st Century Cures Act required the Food and Drug Administration (FDA) establish a program for evaluating the use of real-world data (RWD) to support the approval of new indications for drugs. Real-world data is typically data from either health insurance claims, electronic health records (EHRs), patient registries, or mobile devices. But how has FDA used RWD in practice?
A paper by Feinberg et al. (2020) examines oncology drugs approved by the FDA between 2017 and 2019 to try to answer this question. In this time period, 40 new oncology drugs were approved.
Five of the 40 made reference to RWE submitted in support of the approval. During the same time period, 71 supplemental indication approvals were identified (for 38 oncology drugs); however, drug approval packages were only available for 13. Three of the 13 made reference to RWE submitted in support of the approval. All 8 of the approvals with submitted RWE involved indications with an unmet need for effective therapies. For 5 of the 8 approvals with submitted RWE, the data represented historical controls; in 2 cases the RWE was derived from expanded access studies, and in 1 case the RWE was collected from off-label use of an approved therapy in a new patient population. The submitted RWE was rejected by FDA in 3 of the 8 approvals.
Many of the drugs using RWD were indicated for rare diseases and a variety of different real-world data sources were used.
…we found that 4 of the 5 drugs reviewed had orphan drug designation, and the fifth was for a rare subset within a larger patient population (palbociclib for male patients with breast cancer). Three of the 5 drugs (avelumab, blinatumomab, and selinexor) received accelerated approval for the indications for which RWE was submitted; all 3 had PMRs [post-marketing requirements] for confirmatory clinical trial data, with avelumab and blinatumomab both requiring new clinical trials. The types of RWE used in the regulatory submissions included EHR data, claims data, postmarketing safety reports, retrospective medical record reviews, and expanded access study data.
Efficacy was most often justified using EHR data as a historical control or expanded access studies. Sometimes the EHR data was supplemented with claims data or diagnostic test results (e.g., next-generation sequencing data).
Feinberg BA, Gajra A, Zettler ME, Phillips TD, Phillips Jr EG, Kish JK. Use of Real-World Evidence to Support FDA Approval of Oncology Drugs. Value in Health. 2020 Sep 14.
Pfizer said it will wait until after the US election to file its COVID-19 vaccine with the US regulator, as it waits for important safety data to become available.
The vaccine is being developed by Pfizer and development partner BioNTech and will wait until late November to make its application with the FDA.
In a letter published on its website Pfizer may have the data to say whether the vaccine is effective this month, based on the findings of the ongoing 40,000 person clinical trial.
But CEO Alfred Bourla cautioned that the safety data will only be ready in the third week of November.
There have already been two safety scares in COVID-19 vaccine trials – Johnson & Johnson earlier this week put its phase 3 trial on hold because of an undisclosed illness in a patient.
A US trial of AstraZeneca’s shot is also on hold after a similar incident, although studies in other parts of the world have restarted.
As vaccines will be given to healthy individuals, regulators have far less tolerance for adverse events.
There are further concerns that political interference during the election build-up could undermine the credibility of a mass vaccination programme.
Bourla said: “So let me be clear, assuming positive data, Pfizer will apply for Emergency Authorization Use in the US. soon after the safety milestone is achieved in the third week of November.”
Despite the concerns of scientists president Donald Trump has said that there would be a vaccine available before the election on 3rd November and is hoping that approval could be the “October Surprise” that could boost his popularity ahead of the vote.
Rival Moderna has said it could apply for an Emergency Use Authorization for its rival vaccine as soon as November.
The European Medicines Agency has already started a rolling review of the Pfizer/BioNTech and AstraZeneca vaccines.
The boom in digital tech over COVID means that pharma can move faster than ever – but the industry’s traditional processes for asset approval are still holding timelines back. David Reily examines how pharma companies are responding to the increased burden of asset approval with new ways of working.
The coronavirus pandemic has forced a traditionally risk-averse industry tied to legacy systems for regulation and compliance to fully embrace digital solutions in commercial and marketing functions.
While the majority of executives understand the value and business potential of digital, keeping up this new tempo of rapid digital implementation and asset approval is increasingly challenging while simultaneously maintaining compliance footing.
New digital channels have changed the way patients engage with the medical world around them, while driving expectations on how the pharma industry must respond and deliver their communications during the pandemic.
Every digital initiative, from content creation to review, approval, and distribution, comes with the potential for delays during medical/legal/regulatory review, regulatory impediments, or unexpected factors. And, as the digital world demands fast-tracked timelines, many pharma companies are still held back by inefficient processes and outdated manual systems that limit visibility, collaboration, and sharing across the digital supply chain.
Traditionally, many pharma companies have taken a centralised approach to content management and legal approval in which entire assets, such as a brochure or an article, are created and approved centrally, and then distributed on a local level to every country.
While this traditionally meets the need for brand consistency and compliance, the pandemic has unleashed a greater variance of digital formats that need to be approved at a greater speed.
“The challenge requires transformation and change management on an organisational level and needs to be supported by senior leadership… Embedding the new processes and ways of working is a huge cross functional project that needs good coordination, communication and capability building” Bhupinder McJennett, AbbVie
Indeed, research by Veeva Systems research shows that 83% of pharma companies are creating more content now to support digital engagement than six months before.
The sheer volume of content required across multiple formats threatens to overwhelm traditional, centralised strategies.
Bhupinder McJennett, global digital lead, eyecare, at AbbVie International articulates this problem: “The pandemic has created a marked shift towards digital content creation and the need to approve this content in different formats and at speed. I can only see this workload increasing, driving a need for more efficient, agile approval processes.”
Many commenters have observed that this challenge is about a reallocation of resources and people management. Rick O’Neil, digital consultant to pharma and founder of LTF Agency, says: “As the need and workload of digital assets increases we will clearly require a parallel investment in more headcount on the reviewing and approval side.”
Meanwhile, AbbVie’s McJennett believes that a digital strategy from management is required to address this issue: “The challenge is not confined to digital content creation. It requires transformation and change management on an organisational level and needs to be supported, if not mandated, by senior leadership to facilitate this shift.
“Embedding the new processes and ways of working is a huge cross functional project that needs good coordination, communication and capability building.” Another solution to removing bottlenecks and allowing information to flow from a single source is the use of digital asset approval technology to speed up the approval process.
Such technology could allow for better compliance and faster availability with accelerated creation, approval, and distribution of commercial content across the digital supply chain.
Replacing a mix of systems and processes with a single, seamless digital asset management solution could also reduce complexity and save costs and time.
In practice this means that content could be bulk published, updated, or withdrawn wherever it appears. This approach reduces the need for expensive reworking of minor details, removing bureaucracy and enabling teams to focus on content rather than administration.
Rick O’Neil agrees that enterprise technology will play a key contribution to digital asset approval in the future: “Digital Pharma also needs to consider an efficient process for adapting central content into localising content assets. This is where I see a potential opportunity for a quality enterprise technology to solve this problem”
As the pharma industry responds to the increasing requirements of the pandemic, in-house marketers must use this opportunity to break down the silos between marketing and regulatory teams and address the bottlenecks to initiate more efficient data-driven processes.
This is not easy to do given the current demands of the pandemic but senior management must recognise that this it is vital to enable an efficient digital asset approval process to flourish and scale About the author
David Reilly is the founder of Let’s Learn Digital; delivering quality training in digital and emerging technology for the UK pharma industry.
There are a host of new, previously unimaginable tools and techniques – from analytics to robotic process automation (RPA) and artificial intelligence (AI) – available to help speed up processes and increase data accuracy. But for many life sciences organisations, these tools are either not yet fully adopted or are not being put to good use within their regulatory functions.
Adopting intelligent automation could help organisations realise disruptive benefits that are above and beyond the tangible gains of cost, quality and productivity improvements. By applying intelligent automation, companies could realistically expect to enable: the seamless distribution of product information in a variety of multimedia channels to all internal and external stakeholders; rapid and accelerated implementation of product advances that could propel continuous improvement; and advanced prediction of risks to mitigate against resource capacity constraints – which have been highlighted during COVID-19.
For many companies, it could be realistic to automate as much as half of the manual maintenance tasks currently performed, resulting in significantly different future operating models where blended roles will prevail with strategic product oversight.
“One of the most common mistakes companies make is to allow business units to carry automation initiatives in silos”
But where to begin?
Where do you begin this transformation? Start with the data. Companies need to change the way people collect, curate, interpret and apply data for regulatory submissions and improve confidence in that data. According to Accenture research, most organisations are still struggling to understand the basic ‘truth’ of the data they use and exchange with others. The Accenture Technology Vision survey found just one-third of 103 life sciences executives have high confidence in their data and validate it extensively. To improve data confidence regulatory executives should take a four-step approach to change how they:
Collect Data: Life sciences organisations should utilise cloud-based solutions with global access that facilitates one repository with a single source of truth and eliminates the use of local file sharing and servers. By integrating applications across the end-to-end value chain, they eradicate data entry duplication.
Curate Data: Regulatory specialists need to apply data standardisation and master data management to define the right granular level of data for storage. This needs to be done up front. By implementing robust data governance and management, they can maintain data quality and integrity. By ensuring traceability of data evolution, as well as end-to-end transparency of submission status and its components, they help promote confidence in the data itself.
Interpret Data: Executives need to make more use of readily available data to drive business decisions and optimise operations. They should be applying analytics to past submission data to recommend future submission content plans and pre-empt and mitigate health authority (HA) questions.
Apply Data: Regulatory employees should be using stored data to intelligently create submission documents. By limiting documents full of free text fields and subjectivity companies can adopt a more digitised approach, where document templates can be compiled automatically from available data. Making real-time data accessible to the consumers of the information when and where it’s needed increases the likelihood of buy-in to the system’s value-add. In this way, manufacturing scheduling can be optimised, and batch release decisions more informed. This, in turn, enables healthcare practitioners to get the most up-to-date product information at their fingertips.
Focusing on the business outcomes of how data can be interpreted and applied, through implementation of analytics, RPA and AI, will help strengthen your data vision, enhance your data stewardship culture and provide financial justification for investing in improved data management. This is crucial because all signs point to a future world order of increasing volumes and complexity of new products coming to market, and digital support is a must have – not a nice to have – to handle this workload.
What intelligent automation to consider?
As companies make the move into the realms of intelligent automation, there are 3 key considerations that need to be considered from the offset.
Set the North Star vision: Discuss the company strategy and pipeline considerations for the next 3-5 years and what the business objectives to achieve this strategy are. Is the driver for intelligent automation waste reduction and cost saving, or the speed at which innovative products are being brought to patients? Define the priority focus areas for your intelligent automation roadmap and evaluate the balance of ‘quick wins’ versus longer term strategy initiatives.
Create the Operational Blueprint: Outline what the future processes look like with the inclusion of intelligent automation. What activities remain and from where should they be performed? Consider how job descriptions and roles will evolve to account for the transformed future working environment.
Prototype, automate, evaluate, repeat: Establish the infrastructure to prototype at speed and fail fast. Consider how to implement in an agile, modular manner that gradually combines into an end-to-end solution. Carefully evaluate benefits realised.
“Lack of communication on how the workforce will be re-purposed post automation implementation can lead to internal unrest and possible attrition”
Here are some example use cases showing how Intelligent Automation is changing the game:
Regulatory Requirements & Content Plans
Business Challenge: Maintaining data on submission requirements is a constant challenge. As a result, market requirements gathering is often repeated for each submission, generating longer lead-times. Additionally, insights gained from HA feedback are not incorporated into submissions, reducing first time submission approval accuracy.
Solution: Analytics can compare new submission properties against past submissions to suggest a content plan based on the closest match, and most recent, approved submission.
Health Authority Correspondence Processing
Business Challenge: Timely recording of submission approval dates or tracking of HA questions can be challenging when information received by affiliates needs deciphering and translating before being entered into regulatory systems.
Solution: AI tools can translate and decipher letters without the need for local affiliate intervention and automatically enter information in Regulatory Information Management systems for stakeholders to act upon.
Label Authoring and Tracking
Business Challenge: Managing and providing traceability of the roll out of global label updates is onerous based on language nuances, implementation considerations and replicated data terms across multiple documents which can lead to a high risk of product label inconsistencies.
Solution: AI tools can take the complexity out of mapping global-to-local terms and automatically suggest what updates are needed where, as well as provide end-to-end traceability of the update progress.
As companies make the move to adopt intelligent automation, they need to make sure their projects are: business-outcome oriented (rather than simply automating a task or function); human-centred (so they don’t just eliminate repetitive tasks but rather free up people to focus on higher-value analysis, decision making and innovation); and technology rich (i.e. integrated into the broader architecture of data sources and applications).
How do you ensure success?
And there are pitfalls to avoid. One of the most common mistakes companies (across all industries) make is to allow business units to carry automation initiatives in silos. You should drive home the notion of ‘one company’ and keep an eagle-eye out for cowboys building their own rogue programmes. Similarly, make sure everyone is on the same page – if there is a disconnect between IT and the business, what’s built may not serve what’s needed. And make sure your HR, training and communications teams are looped in, informed and armed with the right information and tools to encourage and support adoption.
Lack of communication on how the workforce will be re-purposed post automation implementation can lead to internal unrest and possible attrition. There will need to be training and change control in place, and that takes planning and management. Finally, from the onset and throughout there needs to be a team tasked with ensuring responsible automation is in place. This needs to be owned by the C-Suite and at every turn communicated to employees, so it is part of the DNA of the transformation: consider the ethical and legal implications when data is handled, and tasks are automated. Know who is accountable and responsible for outcomes and ensure those teams own that responsibility.
The process of adopting intelligent automation isn’t easy but it’s also unavoidable. Adoption of processes and procedures to handle complex data is essential in this day and age – the companies that fail to build a platform that is adaptable to change are at risk of being left behind; those that do adopt new solutions are not only poised to succeed – they are the industry leaders of the future.
About the author
Kim Brownrigg is a senior principal at Accenture and leads the Regulatory Domain in Europe. Her responsibilities include interlinking Consulting, Technology and Operations services to optimise client value and defining next generation service offerings. Kim is currently leading Accenture’s Regulatory digital transformation programme; helping clients define their digital strategy and roadmap within Regulatory, designing applied intelligence solutions and prototypes and delivering pilots and scaled implementation to transform and streamline the industry.
European regulators have started a first ‘rolling review’ of a COVID-19 vaccine, which is being developed by AstraZeneca in collaboration with the University of Oxford.
It’s an historic announcement, bringing hope that the vaccine could be approved in the near future, although the European Medicines Agency did not say how long the process will take.
Confirming press reports, the EMA said that large scale clinical trials from the vaccine codenamed AZD1222 involving several thousands of people are ongoing and results will become available over “the coming weeks and months”.
The rolling review, which is designed to speed up the assessment of a promising vaccine or drug by the EMA’s CHMP scientific committee, will continue until there is enough evidence available to support a marketing authorisation.
But this does not mean that the CHMP is ready to make a conclusion on the safety and efficacy of the vaccine.
All that the agency has is preliminary data from pre-clinical and early clinical studies suggesting the vaccine triggers the production of antibodies and T-cells that target the virus.
In a separate announcement, AstraZeneca said that a trial of the vaccine has resumed in Japan after a safety scare in the UK.
Trials have already restarted in the UK, Brazil, South Africa and India after one patient in the UK developed a potential side-effect that was deemed serious enough to cause the trial to be paused.
Discussions are still ongoing with the FDA, which has asked for further information before making a decision about resuming a trial in the US.
AZD1222 was co-invented by the University of Oxford and its spin-out company, Vaccitech.
It uses a replication-deficient chimpanzee viral vector based on a weakened version of an adenovirus that that causes common cold infections in chimpanzees and contains the genetic material of the SARS-CoV-2 virus spike protein.
After vaccination, the surface spike protein is produced, priming the immune system to attack the SARS-CoV-2 virus if it later infects the body.
SMi reports: AlanFranklin, CEO, ForwardVue Pharma will be presenting at the Ophthalmic Drugs conference The 4th Annual Ophthalmic Drugs Conference taking place on the 23rd -24th November 2020, will explore new discoveries in the treatment of ocular disease, innovations in combination technologies, and the utterly unique challenges that are faced in the treatment of one of the most complex organs in the body.
In the run up to the conference, Alan Franklin, CEO, ForwardVue Pharma is interviewed by SMi Group to discuss his presentation details, insights of the Ophthalmic market and his thoughts on the biggest growth area and key developments that have taken place in the last year.
The ophthalmic drugs industry is maturing each year, in your opinion, what are the key developments that have taken place in the last year?
“The key news to me is the lack of development of approved and late stage anti-angiogenic molecules. Brolucizumab was approved, but it is associated with a small risk of occlusive vasculitis which can lead to profound, irreversible vision loss. Therefore, brolucizumab has not been widely adopted. The NDA for Abicipar pegol, which utilizes DARPin technology was rejected by the FDA secondary to concerns of inflammation with the 2 mg dose”.
What current topic will you be addressing in your presentation, and what would you say makes it relevant to 2020?
“We believe that stable small molecule therapy will offer both efficacy and durability advantages to the current treatment paradigm for common retinal diseases such as diabetic retinopathy, DR, and neovascular age related macular degeneration, nAMD”.
The brochure with the full interview, agenda and speaker line up is available online at:
For exclusive tailored sponsorship packages contact: Alia Malick on +44 (0)20 7827 6168 or email [email protected]
For media queries please contact Jinna Sidhu [email protected] or call +44 (0)20 7827 6088.
About SMi Group:
Established since 1993, the SMi Group is a global event-production company that specializes in Business-to-Business Conferences, Workshops, Masterclasses and online Communities. We create and deliver events in the Defence, Security, Energy, Utilities, Finance and Pharmaceutical industries. We pride ourselves on having access to the world’s most forward-thinking opinion leaders and visionaries, allowing us to bring our communities together to Learn, Engage, Share and Network. More information can be found at http://www.smi-online.co.uk
US biotech BioMarin has hit back with a filing for a rare disease drug, after suffering what was described by analysts as a “major setback” when the FDA rejected its gene therapy for haemophilia A.
California-based BioMarin said the US filing for vosoritide in achondroplasia could lead to the first treatment for children with achondroplasia, the most common form of disproportionate short stature in humans.
This follows a European filing last week for the once daily injection of the analogue of C-type natriuretic peptide, although the company gave no details about a possible FDA decision date.
But the achondroplasia filing came the day after an unexpected FDA rejection for BioMarin’s haemophilia A gene therapy Roctavian (valoctocogene roxaparvovec), which analysts estimate will delay approval by around two years.
BioMarin previously agreed with the FDA on a data package necessary to support approval, but the company said the regulator has introduced a new recommendation for two years of safety and efficacy data.
This data could be generated by the ongoing phase 3 GENEr8-1 trial which uses annualised bleeding rate as a primary endpoint.
The company said the new recommendation was not raised at any time during development or review.
There was no FDA inspection at its manufacturing facility for Roctavian, suggesting the regulator knew a rejection in a Complete Response Letter was due.
However a team of analysts from Jefferies said that EU regulators had given the manufacturing facility a clean bill of health should the product get approval on the other side of the Atlantic.
Describing the rejection as a “major regulatory setback” a team of analysts from Jefferies led by Eun Yang said a worst-case scenario where both drugs are rejected could reduce sales by 25% compared with previous estimates.
BioMarin already markets seven rare disease drugs and has seen its PARP inhibitor Talzenna (talazoparib), developed in partnership with Pfizer’s Medivation unit, get approval in the US and Europe.
It also has three other gene therapies in its pipeline for phenylketonuria, hereditary angioedema, and hypertrophic cardiomyopathy.
The FDA has approved a new therapy for the rare muscle wasting disease Duchenne muscular dystrophy (DMD) as Japan’s NS Pharma takes on Sarepta and its controversially approved rival.
NS Pharma’s Viltepso (viltolarsen) has been approved in patients who have confirmed mutation of the DMD gene that is amenable to exon 53 skipping.
The DMD gene is made up of 79 exons, and mutations in that code can result in a deficiency in dystrophin which is responsible for the muscle wasting in DMD.
Exon-skipping drugs are used to patch the mutations and allow the gene to produce partially functional dystrophin.
Viltepso can be used to treat around 8% of DMD patients and previously approved DMD drugs has not been shown to change the course of the disease.
However what it does do is help produce the dystrophin that patients with the disease are lacking.
It’s bad form to compare performance of drugs in separate clinical trials, but results suggest that Viltepso helps patients produce more dystrophin than Sarepta’s rival Vyondys 53 (golodirsen).
The FDA controversially approved Vyondys 52 late last year after a previous rejection and an appeal from Sarepta.
Viltepso was evaluated in two clinical studies with a total of 32 patients, all of whom were male and had genetically confirmed DMD.
The increase in dystrophin production was established in one of those two studies, a study that included 16 DMD patients, with 8 patients receiving Viltepso at the recommended dose. In the study, dystrophin levels increased, on average, from 0.6% of normal at baseline to 5.9% of normal at week 25.
The FDA deemed that this increase in dystrophin production is “reasonable likely” to predict a clinical benefit –something that is difficult to measure in such a small study.
As part of the accelerated approval process, the FDA requires NS Pharma to conduct a trial to confirm clinical benefit.
This ongoing study will assess whether Viltepso improves the time to stand for DMD patients with the confirmed mutation.
If the trial fails to verify clinical benefit, the FDA may begin proceedings to withdraw approval.
The most common side-effects in the two trials were upper respiratory tract infection, injection site reaction, cough and fever.
There have been no signs of liver toxicity in the 80 patients treated so far, but the FDA is warning doctors to monitor renal function as this issue has been observed in patients taking antisense oligonucleotides.
The Centers for Medicare & Medicaid Services (CMS) has proposed a new rule that would make certain COVID-19-related telehealth flexibilities introduced over the past few months permanent for Medicare beneficiaries. The move comes in conjunction with an executive order from President Trump to improve rural and telehealth access.
“The president’s executive order is likely to change very little about telehealth policy coming out of CMS,” Rebecca Gwilt, a partner and co-founder of health care innovation firm Nixon Law Group, told Home Health Care News in an email. “His executive order essentially encourages the Health and Human Services Secretary to take a look at ways to extend the measures taken during the public health emergency.”
The lack of change is not entirely surprising: CMS already proposed making coronavirus-inspired telehealth flexibilities for home health providers permanent in its proposed 2021 home health rule. On top of that, CMS has repeatedly said only Congressional action can usher in changes such as telehealth reimbursement for home health providers.
Because telehealth is not currently reimbursable for home health agencies, providers are struggling to navigate cash flow and patient care amid the COVID-19 emergency.
Many agencies have been left with no choice but to provide necessary telehealth services to home health patients for free. And because telehealth visits don’t count toward Low Utilization Payment Adjustment (LUPA) thresholds, agencies that provide telehealth services are often hit with a reduced reimbursement to boot.
CMS can’t change that.
However, CMS officials are urging Congress to act to expand telehealth rules, which could, in turn, trigger more home health allowances.
“Our regulatory authority outside of the public health emergency is largely limited to the types of services that can be provided via telehealth,” Verma said Monday during a press call. “We cannot make telehealth available permanently outside of rural areas, nor can we permanently expand the list of providers authorized to provide it. Any extension of the removal of restrictions on site of care, eligible providers and non-rural areas must come from Congress.”
Verma went on to say that Congress’s role in such changes is “essential … in following through on this historic opportunity.”
However, home health doesn’t fall into any of the three areas Verma mentioned — restrictions on site of care, eligible providers and non-rural areas — according to Gwilt.
“These buckets are applicable to Part B reimbursement for telehealth only,” she said. “Home health was largely ignored in the national conversation about supporting the expansion of telehealth.”
It’s anyone’s guess if and when any sort of Congressional help of any kind will come. But the need for such action is clear.
Amid the COVID-19 emergency, 49% of Americans have used some sort of telehealth services, according to findings from the Harris Poll. Another 91% believe such services should be covered by insurance, with 77% saying they plan to continue using telehealth in the future.
On the home health front, there’s been some talk from Congress but no action.
But now, more than two months later, no such bill has been introduced.
Still, National Association for Home Care & Hospice (NAHC) President William A. Dombi is holding out hope that will change soon.
“To achieve the full value that telehealth can bring to patients in their homes we need a combination of actions from Congress, CMS, state Medicaid programs, managed care organizations and commercial health insurance companies,” Dombi told HHCN in an email.
With respect to Medicare home health services, CMS cannot make all the needed changes on its own, Dombi reinforced.
“We need Congress to amend Medicare law to directly authorize fair payment for the delivery of telehealth services under the home health benefit,” he said. “We are hopeful that we will see bipartisan legislation introduced very soon in both the Senate and the House that would establish the changes needed in Medicare law.”
Home-based care providers are at the forefront of the nation’s fight against the coronavirus; yet they still lack the full federal help they need to succeed.
Meanwhile, regulatory flexibilities for hospitals and other health care providers are creating newfound competition for home health and home care agencies.
“So far, it has been difficult to measure whether or not that competition has really created any sort of material impact on home care providers, home health agencies, hospices and the like,” National Association for Home Care & Hospice (NAHC) President William A. Dombi said. “But physicians and non-physician practitioners are put in a position to do home telehealth services today, and that may substitute for what would come from a home health agency or a hospice.”
Dombi made those comments Tuesday at NAHC’s 2020 Financial Management Conference, which was held virtually due to the COVID-19 emergency.
He briefed attendees on current and future legislative matters of interest, including the potential competition threat posed by health care providers that have not traditionally been direct competitors to home-based care.
Regulatory flexibilities have made it possible for those providers to perform duties typically carried out by home health providers.
“Hospitals have been given permission — for patients that were actively in an outpatient [setting] for that facility — to send them to outpatient therapists by way of telehealth into patients’ homes,” Dombi said. “Rural health clinics and federally qualified health centers have been excused from the normal standard that they could only do care in the home if a home health agency was unavailable. Again, we really can’t quantify the level of competition that has come from that.”
While hospitals and health care providers are generally paid for providing telehealth services to patients, home health providers are not. For them, telehealth visits are still not reimbursable, nor do they count toward Low Utilization Payment Adjustment (LUPA) thresholds.
In other words, agencies often must finance telehealth services out of pocket — and on top of that, they can receive a lower-than-usual reimbursement for a 30-day period of care when doing so.
That only makes the competition more of a potential threat. Even with Paycheck Protection Program (PPP) loans and Provider Relief Fund grants, home health providers are facing new financial challenges that are difficult to navigate.
According to survey data from NAHC, about 82% of all home health agencies have seen some sort of revenue reduction amid the COVID-19 emergency, with the median reduction coming in somewhere between 15% to 20%.
While a combination of factors — including sky-high personal protective equipment (PPE) expenses and volume disruptions — are to blame, lack of telehealth reimbursement certainly doesn’t help.
“CMS’s position is that [home health providers] are getting enough money through the episodic reimbursement to carry that kind of a cost, particularly when it’s used to substitute in-person services,” Dombi told event attendees. “But the rub is when the reduction in the volume of in-person visits brings that home health agency into a LUPA level of reimbursement, and then that provider of services is in trouble because LUPAs are losers financially for agencies.”
LUPAs — standardized per visit payments instead of a full episodic payment — reduce the reimbursement an agency receives for delivering care.
If a provider doesn’t deliver a certain number of in-person visits to a patient during a 30 day period of care, it is hit with a LUPA. Under PDGM, there are 432 different LUPA scenarios, with visit thresholds agencies must meet ranging from two to six.
Amid the coronavirus, 47% of all agencies report at least a doubling of LUPAs, according to NAHC survey data.
“What it translates to is about $1,000 to $1,500 difference per patient in revenue — so you can see why we’ve seen that revenue reduction,” Dombi said, noting LUPAs are often out of providers’ control amid the coronavirus. “Patients are saying, ‘I’ll take some care, but not all of the care that you might otherwise give in person,’ thereby reducing the full episode payments that agencies would otherwise receive.”
Securing telehealth reimbursement for agencies remains NAHC’s top priority. The Washington, D.C.-based advocacy organization is hopeful legislation will fix the issue in the near future.
Additionally, NAHC is optimistic newfound perceived competitors could be a good thing in the long run.
“We are definitely hoping that, in the end, those competitors become more partners, particularly on the physician side and other practitioner sides,” Dombi said. “But in the short term and long term, one of the greatest silver linings in this is the opportunity to show the breadth and depth of what can be done in home care.”
NAHC is also pushing for additional provider relief funding for home health, home care and hospice providers, as well as federal assistance providing appreciate pay to front-line home-based care workers.
HEALS Act proposal
Dombi’s statements were pre-recorded before Senate Majority Leader Mitch McConnell on Monday unveiled Republicans’ $1 trillion HEALS Act proposal, which would be the fifth overall coronavirus relief package if implemented.
Among its provisions, the HEALS Act would add $25 billion to the Provider Relief Fund and create new flexibilities under PPP. The Republican plan would also add some new liability protections for health care providers.
On top of that, it would extend the repayment timeline for the advanced and accelerated payments distributed by the U.S. Centers for Medicare & Medicaid Services (CMS) in the spring. Furthermore, the plan would extend telehealth wavers, reduce federal unemployment support and provide Americans with another $1,200 stimulus check.
However, home-based care critics say it doesn’t do enough to help various senior care providers.
Take the National Council on Aging (NCOA), for example. The Arlington, Virginia-based nonprofit organization advocates for services, resources and initiatives to help older Americans.
“NCOA is deeply disappointed by the Senate Republicans’ most recent attempt to address the grave and ever-growing COVID-19 pandemic affecting our country because it fails to support and protect older Americans,” NCOA Vice President for Public Policy and Advocacy Howard Bedlin said in a press release. “Older adults are among the most vulnerable Americans in this pandemic because they are facing not just potentially deadly health complications but also catastrophic financial insecurity.”
LeadingAge — a D.C.-based advocacy organization for the long-term care sector — also took aim at Republicans’ plan.
“Among our disappointments, there are no funds dedicated to aging services providers,” Katie Smith Sloan, president and CEO of LeadingAge, said during a Wednesday press conference. “The legislation includes only a fraction of the hundred billion dollars needed to protect older adults, and aging services providers will have to compete with hospitals and other care providers for those funds.”
Sloan also decried the lack of federal financial support for testing and PPE, in addition to the Republicans’ exclusion of “much-needed” hero pay for front-line senior care workers.
“The bottom line is that Congress needs to deliver more than what’s included in the HEALS Act,” she said. “Adults over 65 account for 16% of the U.S. population and 80% of the U.S. deaths to coronavirus. Our leaders must put older adults at the front, alongside hospitals.”
The good news for senior care providers is that the HEALS Act is still only a proposal. Democrats and Republicans are now in negotiations.
Democrats are pushing for more and different supports in the package — likely similar to those outlined in their HEROES Act, passed in the House a few weeks ago.
Whatever form the stimulus package takes from here, experts expect it to pass in August.
For months now, home health providers have had to worry about an onslaught of new issues, from volume disruptions and personal protective equipment (PPE) shortages, to cash flow problems and lack of telehealth reimbursement.
One long-time stressor they haven’t had to fret about, though, is being audited by the Centers for Medicare & Medicaid Services (CMS). But that’s about to change.
While CMS temporarily paused audit activity back in March as a result of the COVID-19 emergency, it has announced plans to resume enforcement Aug. 3. That means, on top of everything else, home health agencies could also have to worry about proving they haven’t been overpaid by Medicare.
As if that wasn’t enough, at the same time, they could be hit with new, additional types of audits on financial relief received as a result of the CARES Act.
Combined, the various forms of increased oversight could create a huge paperwork burden for already overworked home health providers in the months to come.
While normal fee-for-service Medicare audits are expected to begin in just a few days, audits of Paycheck Protection Program (PPP) loan recipients could start soon thereafter.
Specifically, such audits are expected to begin later this year, according to Matt Wolfe, a partner at the law firm Parker Poe.
That applies to both home health and home care provider PPP loans recipients, none of whom should get too comfortable — even if their PPP loans are relatively small and have been forgiven.
Although the Treasury Department and the Small Business Administration (SBA) have said borrowers who got less than $2 million in PPP loans are considered to have made their requests in good faith, that doesn’t guarantee such loan recipients won’t be audited.
“I think a lot of folks may have breathed a false sigh of relief when they saw that,” Wolfe told Home Health Care News. “But then when [the SBA] issued the interim final rule, they made clear that they retain discretion to audit a borrower regardless of the amount. So if I am a provider, and I received a PPP loan less than $2 million, … it is still critical [to] keep good records to be able to justify retention of loans and the forgivability of the loans.”
According to an HHCN analysis of SBA data, more than 15,000 home-based care providers nationwide received PPP loans of less than $150,000. Approximately 7,400 home-based care providers got loans above $150,000.
All of those entities run the risk of being audited by SBA.
That risk exists for up to six years after the loan is issued. The audit lookback period is on the longer side, but it’s not unheard of, Wolfe said.
“It’s twice as long as the lookback period typically for IRS audits,” he said. “It is similar to some state Medicaid agencies’ lookback periods. It’s longer than most types of Medicare audits. And it is theoretically shorter than the lookback period that the Department of Justice or U.S. Attorney’s Office would have in a False Claims Act.”
To protect themselves from audits, home-based care providers should keep a paper trail to demonstrate their thought process for each step of the PPP lifecycle. That includes documents to prove an agency’s economic need and justify the amount of the loan, as well as for documentation illustrating how the money was used.
“Anytime that HHS is going to be requiring that providers issue reports, they’re not just going to take the providers’ word for it,” Wolfe said. “They’re going to then analyze those reports, and those could lead to further audits in terms of how those funds were used.”
HHS plans to release more details on Provider Relief Fund reporting requirements by Aug. 17.
The Paycheck Protection Program (PPP) has helped home-based care providers who received less than $150,000 in loans save more than 160,000 jobs nationwide, according to data from the Small Business Administration (SBA).
States such as Texas, California and Florida saw the highest number of home-based care jobs retained as a result of the program. Meanwhile, unlikely suspects such as Idaho, Ohio and Missouri saw PPP-recipient agencies retain the most home-based care employees on average.
Home Health Care News discovered those trends while analyzing July 14 PPP data from the SBA. That data includes the number of workers employed by each PPP recipient, as well as the total loan amount granted to each awardee.
For the analysis, HHCN sorted the federal SBA data by NAICS code to identify home-based care PPP recipients that received less than $150,000. From there, HHCN broke the data down on a state-by-state basis.
The North American Industry Classification System, or NAICS, is a classification of business establishments by type of economic activity. NAICS codes are used by government agencies and businesses in Canada, Mexico and the U.S.
Home-based care providers in HHCN’s analysis include all those with the NAICS code 621610, which is used for “establishments primarily engaged in providing skilled nursing services in the home.” In addition to home care and home health agencies, that includes businesses in realms such as home infusion therapy and in-home hospice, among others.
In total, PPP loans helped more than 15,000 home-based care agencies retain a combined 160,175 jobs, the data suggests. In other words, that’s how many aggregate workers are employed by those loan recipients, who might otherwise have gone out of business without the PPP money.
HHCN has yet to review the data for providers that received more than $150,000 in PPP loans.
Explore: Total jobs retained by state
This map shows the total number of home-based care jobs retained by PPP recipients in each state. Darker blues represent more jobs saved. Hover over a state to see the total number of jobs saved there. (Graphic by Kosti Marko/Home Health Care News)
Contextualizing the numbers
PPP was created by the CARES Act to help small businesses navigate the COVID-19 emergency. It set aside billions of dollars in forgivable loans for businesses across a bevy of industries, including home health and home care.
One of the biggest goals of the program is to help businesses keep their workers employed. As such, an important condition of loan forgiveness is that recipients must keep up their staffing levels and wages.
If a PPP loan recipient doesn’t have a full-time employee count equivalent to pre-coronavirus levels by Dec. 31, that recipient won’t be eligible for full loan forgiveness. It will have to pay back a portion of the costs.
Consequently, the aforementioned SBA PPP job retention numbers assume that all PPP recipients will keep the employment levels they had when they applied for their loans. That data could be incomplete.
“PPP loan data reflects the information borrowers provided to their lenders in applying for PPP loans,” an SBA spokesperson told HHCN in an email. “SBA can make no representations about the accuracy or completeness of any information that borrowers provided to their lenders. Not all borrowers provided all information.”
Additionally, it’s worth noting that some PPP home-based care recipients could fail to meet the requirements of the program and lay off employees anyway.
Texas saw the most home-based care workers retained as a result of PPP loans, with 21,541 employees at recipient agencies benefiting.
California and Florida retained the second and third highest number of home-based care jobs. In California, that number was 19,186, while 11,039 jobs were saved in Florida.
Those numbers make sense in context of the large amount of PPP funding Texas, California and Florida received. In a previous analysis, HHCN found that those three states saw the most agencies receive loans, with more than 5,400 home-based care recipients getting about $224 million combined.
Meanwhile, the trends in Idaho, Ohio and Missouri were more surprising.
For example, Idaho of all states saw its 60 home-based care PPP recipients who got less than $150,000 retain the most employees on average, at about 20 each.
Meanwhile, Florida agencies, by comparison, retained an average of only six jobs each.
While it’s unclear exactly why Idaho home-based care PPP recipients retained the highest number of workers, Robert Vande Merwe, executive director of the Idaho Health Care Association, speculated it could be a result of low wages.
“Idaho still has the federal minimum wage of $7.25 per hour,” Vande Merwe told HHCN in an email. “And the Medicaid rate is VERY low for home care.”
Joe Russell, executive director of the Ohio Council for Home Care & Hospice, had other ideas for his state, in which agencies retained an average of 17 jobs each with PPP funding.
He said the average pay rate for an aide in Ohio is about $13 per hour.
“I would venture to guess that those states that have a higher number of jobs saved are probably looking at a larger number of larger agencies getting these PPP loans,” Russell told HHCN.
That appears to be true in the case of Idaho, Ohio and Missouri, the lattermost of which also saw agencies retain an average of 17 jobs each.
But agencies big and small and in those states and beyond continue to need state and federal financial support in addition to PPP, according to the Missouri Alliance for Home Care.
“While the PPP monies did greatly benefit some in the home care industry, the enormous cost of additional personal protective equipment (PPE), decreased utilization, additional staffing, overtime, hazard pay, etc., has had enormous revenue impacts on home care providers,” Carol Hudspeth, executive director of the Missouri Alliance for Home Care, told HHCN in an email. “As a result, the home care infrastructure is in great jeopardy at a time when it is needed the most.”
Home-based care providers who received loans under the Paycheck Protection Program (PPP) could face unexpected expenses when it comes time to file their 2020 taxes.
That is, unless the government intervenes.
“Congress clearly intended that PPP funds would be nontaxable,” Leon LaBrecque — a lawyer, accountant and chief growth officer at Sequoia Financial Group — told Home Health Care News. “[But] the IRS has ruled that expenses associated with the generation of tax-free income is not deductible.”
In other words, Congress and the IRS are looking at PPP money through two different lenses of tax law. And the tax theory the IRS is applying circumvents Congress’s intention of making PPP loans nontaxable.
Even though the money isn’t considered taxable income, per the CARES Act, expenses associated with the loans can’t be deducted from a recipient’s income, according to Bill Sanders, a shareholder and tax group chair at the law firm Polsinelli.
Deductible expenses lower one’s tax liability, which, in turn, typically lowers the amount of taxes that person or entity must pay.
“Either one of those creates a taxable event: Either you have to recognize [money] as income or you can’t deduct it on the expense side,” Sanders told HHCN. “One [way] or the other, you’ve got to pay taxes on that amount.”
Unless something changes, the opposing rules will mean higher taxes for thousands of home-based care PPP recipients come April.
According to an HHCN analysis, more than 15,000 home-based care providers across the country received PPP loans of less than $150,000, with the average loan amount being slightly less than $45,000. Combined, the home-based care PPP loans add up to more than $666 million.
HHCN has yet to analyze the number of providers that received PPP loans above $150,000.
The IRS’s current interpretation of program funding poses a threat to these providers and other loan recipients, according to Sanders and LaBrecque. Even if providers’ loans are forgiven, they could be hit with a huge financial burden in the form of taxes on PPP money at a rate as high as 30% to 40% — which they’ll have to pay out of their own pockets.
“The only way that you’re going to be eligible for [PPP loan] forgiveness is if you use the money … for payments to employees, for rent, for mortgage interest and all those kinds of things,” Sanders said. “But if you’ve used the money and you’ve spent it to stay open, you’re not going to have any of that leftover to pay taxes on it.”
In many cases, PPP recipients applied for the loans out of dire necessity amid coronavirus-related economic struggles. After all, that’s what the program was designed for: to help small and mid-sized businesses stay afloat and keep paying their employees amid the COVID-19 emergency.
While businesses in nearly every industry have struggled during the coronavirus outbreak, home-based care providers have faced a unique set of challenges.
For one, home health and home care agencies operate on paper-thin margins, even in the best of economies. The coronavirus has stretched those margins even thinner, all while home-based care has become more important than ever as a means to keep seniors safe.
When the virus hit, nonmedical home care providers saw volumes — and revenues — dip as patients turned away caregivers out of fear. Plus, agencies saw unexpected workforce expensenses pop up.
For example, many chose to dole out additional hazard pay as a way to show caregivers appreciation and keep them in the workforce. One such agency is Excel Home Care, which received more than $6 million in relief funds — and opted to give all of it directly to its caregivers.
Meanwhile, Medicare-certified home health agencies dealt with all those struggles and more. For example, many have been forced to provide telehealth visits rather than in-person visits when appropriate to keep patients safe — though such visits are not eligible for reimbursement from the Centers for Medicare & Medicaid Services (CMS) and do not count toward Low Utilization Payment Adjustment (LUPA) thresholds.
The PPP tax burden could be the final nail in the coffin for loan recipients, Sanders said.
“They’re already going to be in a position where they’re … teetering on shutting down or bankruptcy,” he said. “I think it’s going to be a very difficult situation.”
Sanders isn’t the only one who thinks so. A coalition of 18 health care organizations — including the American Association for Homecare — have written to Congress urging them to ensure COVID-19 funding and provider relief are not taxable.
“It is critical that the actions taken to support front-line caregivers and hospitals are not diluted by technical issues around the taxability of support funds,” a letter said.
Lucky for PPP recipients, lawmakers seem to be on it. Bipartisan legislation was introduced back in May, but there’s no telling how long it will be before it makes its way to President Trump’s desk.
The sooner that happens, though, the better, according to LaBrecque.
“Congress should remedy the situation if it intends PPP to be fully tax free,” LaBrecque said. “[This] is a story with a short fuse.”
Provider Relief Fund tax problem
The PPP isn’t the only coronavirus-related relief that has unforeseen tax implications.
The CARES Act Provider Relief Fund does, too. It paid out $175 billion to hospitals and health care providers amid COVID-19, including Medicare-reimbursed home health providers.
Come tax time, such relief payments must be included in a provider’s gross income if that provider is for-profit, according to the IRS.
However, tax-exempt health care providers are exceptions. Their Provider Relief Fund payments are not generally subject to tax except under special circumstances.
The UK’s regulator has granted early access to Alnylam’s ultra-rare disease drug lumasiran, allowing patients with primary hyperoxaluria type 1 to gain access ahead of a regulatory decision by the European Commission.
The Medicines and Healthcare products Regulatory Agency (MHRA) gave a positive opinion for lumasiran through its Early Access to Medicines Scheme (EAMS).
Eligible patients in the UK, many of whom are children, will be able to receive the medicine for PH1, an ultra-rare disease that causes excessive oxalate production ahead of a decision by European regulators expected later this year.
This can lead to end-stage kidney disease (ESKD) and other systemic complications.
Affecting between one and three people per million in Europe and the US, there are around 90 patients diagnosed with PH1 in the UK.
Current treatment approaches do not prevent oxalate overproduction and aim to lessen damage to the kidneys and delay progression to ESKD.
PH1 patients with advanced kidney disease require dialysis to help filter waste products from their blood, until they are able and eligible to receive a dual or sequential liver/kidney transplant.
However, long-term dialysis and post-transplant complications can severely impact patients’ quality of life.
Lumasiran is a subcutabneously administered RNA-interference drug that blocks production of a protein called hydroxyacid oxidase, which in turn inhibits production of oxalate.
Regulators from the FDA and European Medicines Agency are reviewing filings based on the double-blind phase 3 ILLUMINATE-A study, a six-month trial testing lumasiran in 39 patients diagnosed with PH1.
Patients were randomised 2:1 to receive three monthly doses of lumasiran or placebo followed by quarterly maintenance doses.
The primary endpoint was the percent change in 24-hour urinary oxalate excretion from baseline to the average of months three to six in the patients treated with lumasiran as compared to placebo.
The MHRA made its decision based on findings of ILLUMINATE-A and other data.
The FDA has granted a six-month Priority Review and is due to make a decision on or before an action date of 3 December.
As we have discussed here previously, real-world data (RWD) and real-world evidence (RWE) offer many potential benefits in every stage of the drug discovery and development process, continuing on into post-market surveillance. With drug developers and other researchers becoming more interested in using RWD and the RWE that results from analyzing it, regulatory agencies have had to step up and work on producing guidance.
There are many
challenges that accompany RWD. Its various forms (e.g. EHRs, disease
registries, claims data) are not necessarily subject to the same
well-established regulations and protocols as clinical data. The data might be
inconsistent, unstructured, in multiple formats and it may not adhere to the
principles of FAIR data. As regulatory bodies consider RWE, they must think
about the quality of the data underpinning it.
The FDA offers
The Food and Drug Administration (FDA) took its first big step in December 2018 by publishing a framework for their real-world evidence program, which helped to lay out some of their goals and issues of importance to be addressed, such as how RWE will be used for regulatory decision-making for drugs, considerations for observational study designs and clinical trial design, data standards for submissions, regulatory issues around the use of electronic source data and more. Actual draft guidance for submitting documents using RWD and RWE for drugs and biologics then followed in May 2019.
The EMA grapples with real-world
Meanwhile in Europe, the European Medicines Agency (EMA) has also had to address the intense interest in RWD and RWE, though there are clearly concerns about whether real-world evidence can be credible evidence. In an article published in the journal Clinical Pharmacology & Therapeutics in October 2019, the EMA officials who authored it noted concerns that “acceptance of non‐RCT methodologies is tantamount to lowering the quality of evidence because these methods are prone to a myriad of undetected or undetectable biases.”
They remain optimistic
about the future for RWE, but are adamant about the importance of testing and
validation. “The ultimate key to achieving credibility is to start with an open
but ‘agnostic’ mind‐set and submit novel
methods to a fair, transparent, and prospective validation exercise,” they wrote.
The pharma response
The FDA has invited comments on its draft guidance, and the pharmaceutical industry has obliged. As reported in Policy & Medicine, a number of suggestions have come in from major players. Gilead, for instance, has proposed expanding the submissions list so that supplemental new drug applications and supplemental biologics license applications are included. Gilead has also suggested lab data be considered a source of RWD, and Novartis has suggested pharmacy claims should be considered a source for RWE.
What is quite clear is
that we are in the early stages of what will be a long process, as regulators
work to formulate policy and guidance for a type of data that they are still
trying to fully define. Real-world data and real-world evidence have much to
offer in drug development and post-market, and it will be important to have the
guidance and cooperation of our most influential regulatory bodies.
In our next piece on
RWE, we will discuss the role of real-world evidence in the fight against
COVID-19, including a new research project spearheaded by the FDA.