Senator Orrin Hatch Calls for Repeal of PPACA Medical Device Tax

Citing a report on the questionable results of the PPACA’s 2.3% medical device tax, Senator Orrin Hatch (R-UT) – Ranking Republican on the Senate Finance Committee -- issued a statement calling for a repeal of the tax (efforts could begin as early as in the lame-duck session post-election). The report from the Department of Treasury Inspector General for Tax Administration said the Internal Revenue Service (IRS) collected $913.4 million in revenue in the first half of 2013 which falls short of the $1.2 billion expected to be generated by the tax. The report said that the taxes collected from firms were frequently over or under the amounts actually due.

HHS Follows Urging of Federal Courts to Accommodate PPACA Mandate

The latest move by federal courts to rule in favor of plaintiffs objecting to the contraceptive coverage mandate under the PPACA came in the form of an injunction ordered by the U.S. District Court for the Eastern District of Pennsylvania which prohibits the enforcement of the provision against the closely held company, Conestoga Wood Specialties, Corp., to the extent such mandates are “objected to on religious grounds.” The ruling follows another by the Supreme Court in Hobby Lobby Stores Inc. wherein the court argued that HHS did not give adequate accommodation to privately held corporations (i.e. “persons” protected under the Religious Freedom Restoration Act) whose owners object to providing such coverage on religious grounds. Last week HHS responded to the problem in issuing an interim final rule effective on August 27th under which non-profit religious organizations will not have to “provide” the contraceptive coverage to which they object on religious grounds, but will instead have to notify HHS/CMS, IRS and the Department of Labor of their objection. The federal agencies will then have the obligation to notify health insurers and third-party administrators of the affected plans that they have the responsibility to provide such coverage without cost sharing to plan participants. The agencies also asked for comments on a similar proposed rule under which privately held corporations, such as Hobby Lobby Stores, might also be extended the same accommodation. Comments on the interim rule are due by October 27th and on the proposed rule by October 21st.

Resumption of Open Payment System Truncated

CMS followed up its earlier announcement that it will resume requiring pharmaceutical and medical device manufacturers to report payments to health care providers via the agency’s Open Payments System with an addendum that about one-third of the records will not be made public on September 30th due to inconsistencies found in connection with the data submissions. CMS said the “flawed” data will be made available in June next year. Senator Chuck Grassley (R-IA) expressed his disappointment in the delay, stating that “Incomplete information won’t give the public a full picture of payment data….”

MedPAC Asks CMS to Rebase Proposed 2015 ESRD Facility Payments

In a letter to CMS, the Medicare Payment Advisory Commission (MedPAC) suggested that CMS delay until 2016 and rebase the Medicare end-stage renal disease (ESRD) bundled market basket using the most current and accurate data that are available because it would better reflect the recent declines in dialysis drug use that occurred under the ESRD prospective payment system (PPS). The letter also suggested that CMS use 2012 audited cost report data rather than allow for the inclusion of unaudited data. MedPAC also suggested that CMS delay implementing the use of a dialysis 5-Star Rating System as part of the CMS Hospital Compare, Dialysis Facility Compare and Home Health Compare websites and request comments before the star system begins.

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