October 30, 2020 | Issue 145 Editor’s note This note is produced every Friday by the KPMG Center for Healthcare Regulatory Insight and is intended to be short and succinct, no more than 360 words, to provide a digestible bite of healthcare and life sciences news from the past week. Please share this email with colleagues and other interested individuals, and encourage them to subscribe to our mailing list here.

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Special Supplement: COVID-19 News

In light of the continuing daily volume of COVID-19 activity and news, we have summarized COVID-19 news for the week in this special supplement.

Healthcare regulatory news

ONC delayed compliance dates for “information blocking” and health IT certification requirements.

A CMS-Labor-Treasury rule finalized requirements for health plans to post in-network and out-of-network provider rates and prescription drug negotiated rates and historical net prices by 2022, and to develop online price transparency tools for 500 “shoppable” services by 2023 and all services by 2024.

CMS finalized a 1.9% ($390M) CY2021 increase for home health and made certain telehealth flexibilities permanent… CMS proposed expanding coverage of continuous glucose monitors for Medicare beneficiaries with diabetes and streamlining coverage, payment, and coding for DME… An HHS-Treasury-Labor interim final rule extends PY5 of the Comprehensive Care for Joint Replacement (CJR) Model by six months.

CMS extended Indiana’s Medicaid expansion program, including work requirements and premiums, for 10 years… CMS selected seven AI Health Outcomes Challenge finalists.

FDA Commissioner Stephen Hahn said that medical device manufacturers should expect higher user fees to ensure regulators can keep pace with innovation… An FDA MOU establishes requirements for states to investigate/respond to drug compounding complaints.

USPSTF recommended colorectal cancer screening for most Americans starting at age 45… GAO reported that private insurer anesthesia service prices (3.5 times higher than Medicare) result from provider negotiation power/market concentration.

Healthcare law and policy news

FBI, HHS, and CISA warned about an “imminent cybercrime threat” against hospitals/health systems… VA launched its new Cerner EHR at its first facility… Anthem will pay $594M as part of a Blue Cross Blue Shield federal antitrust settlement… Aetna resolved alleged HIPAA violations ($1M)… Medtronic settled false claim allegations ($9M).

Intermountain and Sanford plan to merge, creating a 70 hospital system… Bayer acquired Asklepios BioPharmaceutical (up to $4B)… New Mountain Capital will acquire Aurobindo Pharma’s vitamins/supplements unit, Natrol ($550M)… Exact Science will acquire liquid biopsy company Thrive Earlier Detection ($2.15B).

KPMG, EBG, and FocalPoint reported that Q3 healthcare deal volume (476) exceeded Q1 and Q2… Healthcare companies raised $13.44B in Q3 IPOs, up from Q3 2019 ($5.71B), driven by telehealth and digital health investment.

UnitedHealth Group projected that improving members’ health literacy could lead to $25.4 billion in Medicare savings/year and avoid 993,000 hospital visits… Google and Mayo Clinic will use AI to target radiation therapy in cancer patients.

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COVID-19 by the Numbers There are now nearly 9 million confirmed COVID-19 cases in the US, with a death toll approaching 230,000… On average, nearly 72,000 people tested positive daily for COVID-19 over the past week, the highest seven- day average of the pandemic… American Academy of Pediatrics reported that nearly 800,000 US children have had COVID-19 this year… Epidemiologists warned that the country could reach 100,000 cases per day.

The World Health Organization (WHO) warned that abandoning efforts to control COVID-19 is “dangerous.”

Executive and Administrative Action The White House Office of Science and Technology included “ending the COVID-19 pandemic” among its list of highlights during the Trump Administration… Coronavirus Testing Czar Brett Giroir said that the surge in cases is not just a function of increased testing, refuting a claim consistently made by President Trump.

At least five individuals working closely with Vice President have tested positive for COVID- 19.

HHS will pay 10,501 nursing homes $333M in pay-for-performance incentives for reductions in COVID-19 related and deaths… States will receive 125 million cloth masks from HHS by November to support school reopening.

FDA entered a three-year collaboration with Emulate to study using the company’s Organ-Chip technology to evaluate the human immune response to COVID-19 and therapies.

Healthcare Regulatory News Under an HHS-Treasury-Labor interim final rule, Medicare and Medicaid beneficiaries will pay no out-of- pocket costs for authorized or approved COVID-19 vaccines; private health plans must cover the cost of vaccines as long as the public health emergency is in effect; providers must publicize the case prices for COVID-19 diagnostic tests; states can receive expedited review of 1332 waivers during the public health emergency; and states can terminate Medicaid beneficiaries that are not “validly enrolled,” while keeping the temporary 6.2% FMAP increase established by the CARES Act.

FDA updated its COVID-19 antigen test template to recommend certain test developers seeking emergency use authorization include additional study data, including to validate antigen testing for asymptomatic patients… FDA may allow COVID-19 manufacturers to test efficacy against any approved vaccine in order to resolve ethical concerns about placebo-controlled studies.

Healthcare Law, Business, and Policy News A study by University of Washington researchers estimated that universal mask wearing (95% use in public) could save 130,000 lives by the end of February 2021… A Vanderbilt University analysis found that in areas where fewer than 25% of patients are subject to local mask wearing requirements, hospitalizations are 200% higher now than in July, as compared to little change in hospitalizations in areas where at least 75% of patients are subject to local mask requirements.

A Moody’s analysis projected that supply chain changes resulting from COVID-19 will result in increased costs for hospitals, including for personal protective equipment and materials for construction and other spending projects.

An Axios/Ipsos poll found that 46% of Americans believe the federal government’s response to the pandemic has gotten worse over time.

Surveillance, Testing, and Treatment leaders predicted hundreds of millions of COVID-19 vaccine doses will be available in the first quarter of 2021… NIAID Director predicted that a COVID-19 vaccine won’t be available until January or later.

AstraZeneca and Johnson & Johnson continued their respective phase 3 COVID-19 vaccine trials… AstraZeneca reported that its vaccine being developed with University of Oxford produced an immune response in both young and old adults… Pfizer and BioNTech’s stage 3 COVID-19 vaccine trial is nearly fully enrolled, however they have not yet completed an interim analysis of the vaccine’s efficacy, falling short of their target for sharing data… Novavax delayed start of its phase 3 COVID-19 vaccine trial to late November… Sanofi and GlaxoSmithKline will supply 200 million doses of its COVID-19 vaccine to Covax, a global collaborative to provide vaccines to developing nations… Takeda will import and distribute 50 million doses of Moderna’s COVID-19 vaccine candidate in Japan.

The European Medicines Agency would approve a COVID-19 vaccine even if trials showed that it was effective in less than half of individuals, lower than the FDA’s likely 50% threshold… Washington, Oregon, and Nevada joined California’s COVID-19 vaccine safety review group, which plans to independently review vaccines approved by FDA… A JAMA opinion piece proposes giving COVID-19 vaccine prioritization to healthcare workers, people in high-risk occupations and housing, and those with high-risk conditions.

The World Health Organization is preparing to release guidelines in 3 to 4 weeks on use of remdesivir to treat COVID-19.

A trial of Eli Lilly’s COVID-19 antibody treatment, in conjunction with remdesivir, ended after NIH researchers determined that the drug would not help hospitalized patients with advanced illnesses; Lilly will continue testing its efficacy in preventing progression of the disease in early stages… Operation Warp Speed subsequently announced it would purchase 300,000 doses of Eli Lilly’s antibody drug for $375 million once it receives emergency use authorization and that patients will have no out-of-pocket costs for the drug… Regeneron announced that its COVID-19 antibody treatment reduced medical visits among infected patients by 57% when compared to standard care.

An English study found that the number of people with COVID-19 antibodies declined 26.5% between June 20 and September 28, indicating immunity may not be long-lasting… Evidence is emerging that “autoantibodies” that attack the body, rather than the virus, are developing in some COVID-19 patients and may be associated with so-called “long hauler” patients.

University of Oxford is beginning a trial of a COVID-19 test for asymptomatic individuals.

CVS will add 1,000 more COVID-19 rapid-result testing sites at its pharmacies by year-end.