Nov. 4 Federal Update: ACF Releases Inaugural Data Strategy to Improve Services for Children and Families

The Administration for Children and Families (ACF) released its inaugural data strategy to promote equity, enhance support for grant recipients, and invest in improved disaster preparation. ACF envisions 12 initiatives to responsibly exchange data across the human services landscapes. These initiatives are split among four categories to better inform policy and safely deliver services and benefits more quickly.

• Sustaining Initiatives will develop the foundational infrastructure to support the data strategy, including by creating a long-term funding and investment plan and establishing a data governance council.
• One Stop Shop Initiatives will create centralized resources to support program offices in building their data capacity, including by creating a data talent center to support hiring and team development.
• Delivery Initiatives will advance ACF’s use of data, including through centralized resources that support program offices in building their data capacity and by releasing community-centered data tools and stories.
• Technology Initiatives will provide the technology platforms and tools needed to streamline data reliability and enhance collaboration, including the launch of a customer relationship management system to coordinate across ACF.

Download a comprehensive overview of their data strategy to learn more about each of the initiatives and how they will support and strengthen data sharing throughout the sector.

Biden Administration Proposes New Rule to Increase Coverage of Contraception for Private Health Insurance Holders

The Departments of Health and Human Services, Labor, and Treasury recently released a proposed rule to significantly increase contraception coverage under the Affordable Care Act. The rule would enable women to obtain over the counter (OTC) contraception without a prescription at no additional cost such as emergency contraception and Opill, the first oral contraceptive approved by the Food and Drug Administration (FDA) for use without a prescription.

Additionally, the rule is expected to increase choice by mandating that plans and issuers expand the coverage of oral contraceptives and drug-led combination products, including intrauterine devices (IUDs). It reinforces plans and issuers’ responsibility to cover FDA-approved, cleared, and granted birth control methods at no cost to recipients.

The rule would require most private health plans to disclose OTC contraception is available without cost sharing or a prescription as well as to assist women in learning about their contraception coverage. Under the rule, plans and issuers would also be required to add a disclosure to the results of any online Transparency in Coverage self-service tool search for covered contraceptives explaining OTC contraceptives’ coverage.

Alongside the proposed rule, the Biden Administration issued guidance to ensure patients can access other preventative services, including cancer screenings, without cost. Comments may be submitted until Friday, Dec. 27.

IRS Releases Benefit Plan Notices

The IRS has issued guidance to expand the preventive care items and services High-Deductible Health Plans (HDHPs) may cover before plan deductibles are met.

Two notices released by the agency, which outline both expenses treated as paid medical care as well as preventive care for purposes of qualifying as a HDHP, include over-the-counter oral contraceptives, including OTC birth control pills, male condoms, and emergency contraceptives, regardless of whether they are purchased with a prescription. Non-mammogram breast cancer screenings, continuous glucose monitors, and selected insulin products were also named in the preventative care coverage.

Updates from the Judiciary

FTC Appeals Fifth Circuit Court’s Noncompete Ban
The Federal Trade Commission (FTC) requested the 5th U.S. Circuit Court of Appeals to review a Texas district court’s ruling which set aside the FTC’s ban on noncompete agreements in employment contracts. The Northern District of Texas issued its ruling in August, maintaining the FTC’s ban violated the Administrative Procedure Act by exceeding the commission’s statutory authority. The lower court argued that the Federal Trade Commission does not have the authority to create substantive rules regarding unfair methods of competition. The ruling stopped the Non-Compete Rule from nationwide enforcement.

The FTC’s non-compete rule would have prohibited employers from entering and enforcing new non-competes with all workers including, but not limited to: employees, independent contractors, externs, interns, volunteers, apprentices, and sole proprietors who provide a service to a client. It would require employers to notify current and former workers, excluding senior executives, that their non-competes are no longer enforceable. The rule would also render existing non-competes unenforceable, excluding senior executives.

A federal court in Florida similarly rejected the non-compete rule, but alternatively grounded their decision in the major questions doctrine. The major questions doctrine refers to the Supreme Court declaration that if an agency seeks to decide an issue of major national significance, its action must have clear congressional authorization. Considering the economic significance of non-competes, Florida’s federal judges ruled against their implementation. The FTC has since appealed its decision, although the rule remains paused.

A federal court in Pennsylvania upheld the rule, however, the company which brought the suit has since withdrawn the case. The judges rejected the company’s claims it would suffer irreparable harm to its contractual rights and investments in specialized training if the rule were to go into effect. The judges also affirmed the FTC acted within its authority to designate all non-compete clauses as unfair methods of competition.

As the FTC’s appeals are considered, employers can continue utilizing non-competes. The judges’ decisions, however, will likely have significant implications for the future of non-competes in employment contracts nationwide and will play a key role in defining the scope of the FTC’s regulatory authority.

Pharmaceutical Companies Appeal Medicare Drug Price Negotiation Program
AstraZeneca, Bristol Myers Squibb, and Janssen requested the Third Circuit Court of Appeals to revive their previously dismissed lawsuits challenging the government’s authority to negotiate Medicare drug prices.

Through the first round of negotiations, the prices of AstraZeneca’s diabetes medication, Farxiga, Bristol Myers’ blood thinner, Eliquis, and Janssen’s blood thinner, Xarelto, were each reduced between 56% and 68%. The negotiated prices will go into effect in 2026 and, projected, will save Medicare approximately six billion in the first year.

The pharmaceutical companies raised numerous concerns, such as the severe consequences of refusing to accept negotiated prices. Either by accepting steep penalties or withdrawing from Medicare, Bristol Myers Squibb argued the negotiation process amounts to an unconstitutional taking of property without just compensation.

Meanwhile, Janssen’s attorney grounded their argument in First Amendment concerns, maintaining that requiring companies to agree to a “maximum fair price” compels speech which violates their constitutional rights.

The pharmaceutical industry has filed eight lawsuits against the Biden Administration, challenging the validity of Medicare’s negotiation authority. Federal courts have continued to uphold the constitutionality of the drug price negotiation program, enforcing the importance of the Third Circuit’s ruling. A ruling in favor of Medicare would fortify the precedent needed to discourage future challenges. A ruling in favor of the pharmaceutical companies, however, is expected to impact access to life-saving medications significantly.

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