• Background. After multiple continuing resolutions (CR) due to disagreements over spending priorities, Democrats and Republicans have been working to reconcile differences. Specifically, GOP senators have been opposed to additional COVID-19 relief money, instead pushing for a review of how much unspent pandemic relief funds remain.

• What’s Next? Appropriators are pushing to formally file the omnibus in the House this evening, at which point the Rules Committee would meet to consider a rule for the underlying bill. Assuming the 12-bill spending package is ready this evening, votes in the lower chamber would occur tomorrow, with Senate action likely falling toward the end of the week. However, it is possible that lawmakers may need more time to finish the bill. As such, Congress would take up a short continuing resolution (CR) to avert a shutdown by midnight on Friday.

• Drug Related Provisions
• Drug Discount Program — With regard to the 340B Program, this provision would allow hospitals that — as a result of the COVID-19 Public Health Emergency (PHE) — fail to meet the applicable requirements for the disproportionate share adjustment percentage to remain a covered entity through December 31, 2022. Hospitals which fail to meet the applicable requirement after this date would be subject to penalties as stipulated under current law, unless otherwise specified.

• Drug-Free Communities Support Program — The FY 2022 omnibus spending package would waive the federal fund limitation for the Drug-Free Communities Support Program (DFCS Program) in the event that the DFCS Program Administrator determines that an eligible coalition is unable to raise the agreed upon amount of non-Federal funds for FYs 2020, 2021, or 2022 as a result of the COVID-19 PHE. The bill specifies that the Administrator may provide a grant — or grant renewal — to such a coalition in specified amounts given the coalition’s duration in the DFCS Program, and further stipulates that such a grant — or grant renewal — may not exceed the amount initially agreed to via contract between the Administrator and coalition.

• Medicaid
• Extension of Enhanced FMAP for Certain U.S. Territories — Under current law, the enhanced FMAP of 83 percent available for eligible Medicaid expenditures for American Samoa, the Commonwealth of the Northern Mariana Islands (CNMI), Guam, and the U.S. Virgin Islands is set to expire on March 11, 2022. This provision would extend the availability of the 83 percent FMAP for these territories until December 13, 2022, at which point the FMAP will revert back to 55 percent unless another extension is authorized by Congress.

• Extension of Enhanced FMAP and Other Requirements for Puerto Rico — This provision would retroactively extend the enhanced FMAP of 76 percent available for eligible Medicaid expenditures for Puerto Rico from January 1, 2022, until December 13, 2022. Under current law, the FMAP for Puerto Rico has been set at 55 percent since the previous enhanced FMAP of 76 percent expired on December 3, 2021. In addition to reauthorizing the enhanced FMAP for Puerto Rico, this provision would increase the allotment cap for the territory by $200 million for FY 2022. In order to be eligible for these additional federal funds, Puerto Rico would be required to amend its Medicaid state plan to establish directed payments for physician services that are covered under Medicare Part B at a minimum rate of 70% of what Medicare Part B would pay for such services. Finally, this provision would require Puerto Rico to submit a report to Congress by December 1, 2022, on the procurement process and standards the Medicaid agency uses for selecting contracts.

• Third Party Liability (TPL) — Under current law, Medicaid is generally the “payor of last resort,” and states are required, among other things, to identify a beneficiary’s third-party health coverage and avoid payment for services in most circumstances in which the state believes that the third party is liable. This provision would make several changes to Medicaid TPL policies, beginning January 1, 2024, to:
• Require third-party payors, who require a prior authorization for a service, to accept the prior authorization from a state if such service is covered under the Medicaid state plan;
• Require third-party payors to respond to inquiries from the state for payment of a claim within 60 days; and
• Prohibit a third-party payor from denying a claim submitted by the state solely on the basis of not obtaining a prior authorization for the service for which the claim is submitted.

• Medicare
• Telehealth — The spending package would make several changes aimed at expanding and extending telehealth flexibilities, including:
• The removal of geographic requirements and expansion of originating sites for telehealth services;
• An expansion of practitioners eligible to furnish telehealth services — to include occupational therapists, physical therapists, speech-language pathologists, and audiologists;
• The extension of telehealth services for federally qualified health centers (FQHC) and rural health clinics;
• A delay to the in-person requirements under Medicare for mental health services furnished through telehealth and telecommunications technology;
• An authorization for the furnishing of audio-only telehealth services; and
• An authorization for the use of telehealth to conduct a face-to-face encounter prior to recertification of eligibility for hospice care.

• Each of the aforementioned changes would be effective for 151 days after the conclusion of the COVID-19 PHE. Additionally, under the bill, the Secretary of the Department of Health and Human Services (HHS) would be authorized to implement these provisions via program instruction or otherwise. 

• Additionally, the legislation would require that the Medicare Payment Advisory Commission (MedPAC) conduct a study and submit a report to Congress on telehealth utilization — prompted by specified guidelines — no later than June 15, 2023.

• Additional Medicare Provisions — With regard to the timing of MedPAC’s report to Congress on ambulance cost data, this provision extends the deadline for such a report from March 25, 2023, to the “second June 15^th following” the Secretary’s transmittal of data on the subject to MedPAC. Additionally, the spending package would extend the current terms, under law, for the calculation of the hospice cap amount under Medicare from 2030 to 2031 and would reduce funding for the Medicare Improvement Fund from $99 million to $5 million in FY 2022 and beyond, presumably as a payfor for these provisions.  

• Maternal Health
• Innovation — The omnibus spending package would direct HHS to award competitive grants for maternal health innovation. Beginning on September 30, 2025, at the latest — and every two years after — HHS would be required to provide a report to Congress on this grant program to Congress. Such innovations under the grant may include: (1) identifying, curating, and disseminating best practices to improve maternal and infant health; (2) collaborating with state maternal mortality review committees to identify relevant maternal health concerns on which the grant should focus as a means to improve maternal mortality and morbidity rates; (3) providing technical assistance and support for implementing the aforementioned best practices to facilities providing pregnant and postpartum care; and (4) pinpointing, creating, and evaluating new care models that improve maternal and infant outcomes. The FY 2022 omnibus package authorizes $9 million each FY from 2023 through 2027 for these grants.

• Provider Training — This section of the FY 2022 omnibus package would create a grant program for medical and nursing schools — as well as other health care professional training programs — to boost training for prenatal, labor, birthing, and postpartum care for racial and ethnic minorities. These grants can include bias training. Grantees would be required to adhere to period reporting provisions, and HHS is directed to report the programs’ status to Congress no later than September 30, 2026. The spending package would authorize $5 million for these grants from FY 2023 through FY 2027. Additionally, a separate provision in the FY 2022 package requires HHS to contract with an independent research organization to conduct a study and recommend best practices for these training programs.

• Services for Pregnant and Postpartum Women — The omnibus spending package would direct HHS to award competitive grants to integrate services for pregnant and postpartum women. HHS can award these grants for the purposes of integrating care to optimize the health of mothers and their infants, including mechanisms to address health disparities. These grants are available for states, Tribes, and local agencies that treat Medicaid beneficiaries; health care providers that serve pregnant and postpartum women; and community-based health organizations and workers. Grants will span five years, and additional awards under the grant can be made for less than five years. The FY 2022 language encourages HHS to prioritize states with high rates of maternal mortality and morbidity and health disparities when awarding grants. Congress authorizes $10 million each FY — from 2023 through 2027 — to carry out this section. Additionally, HHS is directed to report details of the grant program to the House Committee on Energy and Commerce and the Senate Committee on Health, Education, Labor, and Pensions (HELP) by February 1, 2027. Congress would also direct HHS to disseminate information on best practices garnered from the grant program to relevant stakeholders by August 1, 2027.

• Vaccine Awareness — The omnibus text includes a provision related to public awareness campaigns on the importance of vaccines. Specifically, the language would instruct HHS to increase vaccine awareness and knowledge of safety and efficacy of vaccines in pregnant women, infants, and postpartum women. This provision does not include additional appropriations to supplement the preexisting $15 million appropriated each year from FY 2021 through 2025 to implement a public awareness campaign for vaccinations.

• Rural Maternal Care Data — Several provisions in the FY 2022 package alter existing laws surrounding data collection to include and specify certain populations, as detailed below.
• In addition to the Centers for Disease Control (CDC) data collection efforts related to preterm labor, preterm delivery, and infant mortality, the FY 2022 omnibus package would instruct CDC to broaden its efforts to include “preventable maternal mortality and severe maternal morbidity.” 
• It also instructs the CDC Office of Women’s Health (OWH) to specifically disaggregate data across Native American, Native Hawaiian, and Alaskan Native populations, as well as by geographical context (e.g. rural and urban).
• The bill would modify current CDC “Safe Motherhood” surveillance authorities to improve disaggregation of data. It also expands the “Safe Motherhood” program to include examination of relationships between maternal health and obstetric services in rural areas and delivery and postpartum care outcomes.
• Include the issue of preventable maternal mortality and morbidity within the National Institute of Health’s (NIH) Advisory Committee within the Office of Research on Women’s Health.

• Rural Obstetric Network Grants — The FY 2022 omnibus would create rural obstetric network grant in rural, frontier, Tribal, and maternity care health professional target areas. Grantees may utilize the funding to create or continue collaboration and innovation to improve maternal and infant outcomes. Rural obstetric networks can: (1) develop a network to improve access to care; (2) identify and implement evidence-based care delivery models; (3) develop a model to improve access to care, including telehealth; (4) train health care professionals; (5) collaborate with academic institutions; and (6) assess and address infant and maternal health outcome disparities in minority and underserved populations. HHS would be required to report to Congress on the grant program’s activities by September 30, 2026. Under the bill, Congress would authorize $3 million per year for FY 2023 through FY 2027.

• Telehealth Network and Resource Center Grant Programs — A provision in the FY 2022 omnibus would include prenatal, labor care, and postpartum providers — as well as hospitals with obstetrics units — as an optional network requirement for existing Telehealth Network Grant Programs. Currently, the program includes a provision that directs HHS to prioritize applications for grantees that offer prenatal care for high-risk pregnancies. However, the omnibus language would expand this provision to include prenatal, labor, birthing, and postpartum care.

• Training Demonstration — The FY 2022 omnibus would stand up a grant program for rural maternal health and obstetric care evidenced-based training programs to: (1) train physicians, medical residents, fellows, nurse practitioners, physician assistants, nurses, certified nurse midwives, relevant home visiting workforce professionals, paraprofessionals, and other professionals (as determined by the state in question); and (2) develop recommendations for the program. HHS must submit a report on the program by January 1, 2026, to Congress. The bill would authorize $5 million each year for FY 2023 through FY 2027 for the demonstration.

• Other Provisions
• Extension of Temporary Assistance for Needy Families — The omnibus spending package would extend the availability and flexibility of block grants to states — as authorized for FY 2021 — for the Temporary Assistance for Needy Families (TANF) program until September 30, 2022.

• National Disaster Medical System — Under current law, the Secretary of HHS holds the authority to appoint individuals to positions within the National Disaster Medical System if the number of personnel to combat the national disaster response is deemed insufficient. This authority is currently set to expire March 11, 2022, and the FY 2022 omnibus would extend the Secretary’s authority until September 30, 2023.

• Synthetic Nicotine — This provision would modify the definition of tobacco products to include products containing nicotine from “any source,” thereby expanding the FDA’s authority to regulate the introduction and distribution of such products. The omnibus would also ensure that nicotine products marketed in the U.S. before the provision takes effect will not be considered in violation of the premarket review process for certain tobacco products during the 60-day period following the enactment of this act. However, as a condition for continuing to market nicotine products after the 60-day period, the manufacturer would be required to submit a new product application for review by the FDA. Lastly, this provision would also require the Secretary of HHS to submit an annual report, each year user fees are collected, to the House Committees on Energy and Commerce and Appropriations, as well as the Senate Committees on HELP and Appropriations, that contains information from each tobacco and synthetic nicotine product manufacturer necessary to assess their annual user fees. This report would become public on the FDA website.

• Fentanyl Scheduling Extension — Under current law, the temporary scheduling order issued by the Drug Enforcement Administration (DEA) to place fentanyl-related substances in Schedule I of the Controlled Substances Act is set to expire on March 11, 2022. This provision in the FY 2022 omnibus would extend the expiration date to December 31, 2022.