Archives for September 7, 2016

Opioids, benzodiazepines now require boxed warnings outlining risks of combined use

As part of the fight against opioid overdoses and deaths, the FDA now requires boxed warnings containing the risks associated with taking opioids and benzodiazepines simultaneously. In a data review, the FDA found that providers have been increasingly prescribing opioid analgesics and opioid-containing cough products along with benzodiazepines in recent years.


The updated warnings will apply to almost 400 different products, and will contain information about the risks of extreme sleepiness, respiratory depression, coma, and death when using the products together. FDA Commissioner Robert Califf stated that prescribers should carefully evaluate whether the benefits of using these medications together outweigh the serious risks on a patient-by-patient basis.

Opioid analgesics include oxycodone, hydrocodone, morphine, and other brand and generic medications designed to reduce pain. Benzodiazepines are used for treating neurological and psychological conditions, such as anxiety and seizure disorders. Although both classes of drugs depress the central nervous system (CNS), their differences require unique labeling information and slightly different warnings.


The FDA began reviewing scientific information about the combined use of these drugs even before it received a citizen petition in February 2016 requesting changes to existing labeling. The review revealed that the number of patients prescribed both drugs increased by 2.5 million between 2002 and 2014, or about 41 percent. Between 2004 and 2011, the rate of emergency department visits for non-medical use of both drug classes increased significantly, while overdose deaths nearly tripled. The new warning requirements are part of the agency’s Opioids Action Plan developed in response to the growing epidemic. The agency provided a response to the citizen petition and examples of labeling change notification letters.

Off-campus outpatient department payment proposal meets industry criticism

CMS’ proposal to revise the outpatient prospective payment system’s (OPPS) method for reimbursing hospitals and physicians for services performed at off-campus locations has received harsh critiques from the industry. Hospitals are concerned that as written, the Proposed rule would require them to enter into financial arrangements with physicians that may otherwise violate fraud and abuse laws. Yet without making such arrangements, hospitals would be required to pay for these off-campus facilities but receive no reimbursement for services.

Proposed rule

The Proposed rule (81 FR 45603) in question is a lengthy one that concerns several programs and entities. One of the many things proposed is implementation of section 603 of the Bipartisan Budget Act, which mandated that certain services furnished off-campus will not be considered outpatient department (OPD) services, but paid under the applicable Part B system. For new off-campus departments that billed for Medicare outpatient services under the OPPS after November 2, 2015, the physician fee schedule will be applied in 2017 for most services.

Hospitals often have multiple departments and facilities spread across an area, and these must meet certain criteria to be considered provider-based. An off-campus outpatient department must be located within a 35 mile radius of the hospital, be held out to the public as part of the hospital, operate its finances fully integrated with the hospital, and provide clinical services integrated with the main hospital.


The American Hospital Association recently published a letter stating its objection, accompanied by a legal memorandum. Calling the policies “short-sighted and unworkable,” the letter states that hospitals will not be provided reimbursement for some Medicare services under the site-neutral policies. The AHA reasons that off-campus departments that have existing financial arrangements with physicians may run afoul of the Stark law (42 U.S.C. §1395nn) and the Anti-kickback Statute (AKS) (42 U.S.C. § 1320a-7b). The AHA believes that CMS must delay site-neutral policy implementation for at least one year in order to address the significant compliance risks.

The accompanying legal memorandum provided by Hogan Lowells dives deeper into the policy implications. The memorandum finds that the new policy may result in physicians receiving payment for expenses to own and operate the facility, even though it is an off-campus department of a hospital. Hospitals are prohibited from providing free goods and services to referring physicians under the AKS and Stark law. Even furnishing items for a physician to use in his practice may be implicated under these laws, if the items reduce a physician’s cost of doing business and are offered with intent to induce referrals. Under the new policy, physicians would receive a benefit of reimbursement for services when they paid nothing for the location in which the services were provided.

Other comments

Lawrence Vernaglia, Foley & Lardner health attorney, offered the opinion that implementing these new payments would impose unreasonable difficulties on outpatient departments that wanted to add new services. He suggested that CMS alter the requirement that grandfathered facilities remain exactly the same as before the rule was implemented and allow departments to make necessary changes. In addition, because site-neutral payments are unlikely, in his opinion, to reduce outpatient department costs, hospitals may decide to close off-campus facilities which could limit access.

America’s Essential Hospitals (AEH) focused on these access issues in its comments, stating that CMS policies “will perpetuate health care deserts” by limiting flexibility and withholding payments to outpatient departments. It emphasized that establishing and sustaining new off-campus facilities is a challenging process when serving vulnerable patients, and that the policy will make new facilities “economically unsustainable.”

These access comments should have been of little surprise to CMS, as on May 19, 2016, a very large group of senators signed a letter addressed to Acting Administrator Andy Slavitt requesting flexibility in applying the new policies. The senators emphasized the necessity of providing hospitals a predictable landscape while providing them the leeway needed to ensure access. The senators specifically asked for flexibility for services provided at dedicated emergency departments (DEDs) as well as off-campus departments that sought to relocate, rebuild, expand, or change ownership in order to meet a community’s needs.