Medicare: Payment for Blood Clotting Factor Exceeds Providers' Acquisition Cost
Published: 2003-01-10T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: In 2001, Medicare's outpatient expenditures for blood clotting factor used to treat the estimated 1,100 beneficiaries with hemophilia totaled about $105 million, or more than 2 percent of total Medicare spending on outpatient drugs. Earlier work by GAO indicated that Medicare's payment for certain outpatient drugs is substantially higher than providers' acquisition costs. Concerns have been raised about Medicare's payment for blood clotting factor. GAO was asked to compare provider costs of purchasing clotting factor with Medicare's payment for it and to identify costs to providers associated with delivering clotting factor.
section_title: What GAO Found
paragraphs: Medicare's payment for clotting factor, like other outpatient drugs, is 95 percent of the average wholesale price (AWP), a price established for each drug by its manufacturer. Medicare's payment is substantially more than the actual acquisition costs of hemophilia treatment centers (HTC) and homecare companies, which provide a majority of Medicare beneficiaries with clotting factor. Most HTCs obtain prices from manufacturers that are 35 to 48 percent below AWP by participating in a federal program that guarantees them low prices. Homecare companies obtain prices that range from 22 to 40 percent below AWP. Providers incur additional costs associated with delivering clotting factor that are not separately reimbursed by Medicare. GAO estimates that these additional costs in 2000 and 2001 ranged from $0.03 to $0.08 per unit sold by HTCs. (Hemophilia patients use an average of 78,000 units of clotting factor annually.) GAO did not receive enough data from homecare companies to estimate their costs. Delivery costs are generated in inventory management, specialized refrigerated storage, shipping, and the provision of ancillary supplies such as needles, syringes, and tourniquets to patients.

section_title: Letter
paragraphs: In 2001, Medicare’s outpatient expenditures for blood clotting factor  totaled about $105 million, or more than 2 percent of total Medicare  spending on all covered outpatient drugs and biologicals. Blood clotting  factor is a biological used by persons with hemophilia to prevent  uncontrolled internal bleeding that could result in disability or death. The  Centers for Disease Control and Prevention (CDC) estimate that  approximately 18,000 Americans, nearly all male, have hemophilia and  about 1,100 of these individuals are Medicare beneficiaries.
Medicare’s payment for clotting factor, like other outpatient drugs and  biologicals, is 95 percent of the average wholesale price (AWP). Often  described as a “sticker price” or “list price,” AWP is established for each  drug by its manufacturer. Medicare’s AWP-based payment has recently  come under scrutiny. In 2001, we reported that providers were able to  purchase certain drugs at prices significantly less than the payment they  received from Medicare. Although providers contended that this  overpayment was necessary to compensate for underpayment for other  services, we concluded that Medicare should not rely on potential  overpayments for some services to offset potential inadequate payments  for other services.
The method of delivery of clotting factor has implications for Medicare  payment. Most outpatient drugs covered by Medicare are administered in a  physician’s office. When a beneficiary visits a physician in order to receive  a drug, the physician receives one payment from Medicare for the drug  and another payment through the physician fee schedule for administering  the drug. Clotting factor, however, is generally not administered in a  physician’s office. Medicare pays clotting factor providers, mainly  hemophilia treatment centers (HTC) and homecare companies, solely for  the drug. These providers generally purchase clotting factor products  directly from the manufacturers, rather than from drug wholesalers, and  deliver them directly to the very small hemophilia population.
Because clotting factor products were not included in our 2001 report, you  asked us to evaluate whether Medicare’s payment for clotting factor is  higher than its acquisition cost and to identify and describe any aspects of  the production and delivery of clotting factor that may relate to how  Medicare payment should be determined. In this report, we (1) describe  characteristics of the clotting factor delivery system, (2) compare provider  costs of purchasing clotting factor with Medicare’s payment for it, and   (3) identify any costs to providers associated with delivering clotting  factor and furnishing related services to Medicare beneficiaries with  hemophilia.
To conduct this study, we obtained data on the hemophilia population  from CDC. We analyzed the most recent data available from the Health  Resources and Services Administration (HRSA) on HTC clotting factor  acquisition prices obtained through a federal discount program. We also  analyzed data on clotting factor acquisition prices from two large, national  homecare companies. In addition, we analyzed acquisition price data  provided to us by an HTC association for seven HTCs that had purchased  clotting factor outside the federal discount program. We also analyzed  related data on clotting factor prices from the Centers for Medicare &  Medicaid Services (CMS), the agency that administers Medicare. We  analyzed data on provider delivery costs for four HTCs, which we obtained  from a representative of an HTC association, and for two large, national  homecare companies, which we contacted directly. We interviewed  officials at the Department of Health and Human Services (HHS) Office of  Inspector General (OIG), two patient advocacy organizations, four of the  six clotting factor manufacturers, two wholesalers, and several additional  HTCs and homecare companies. Our work was performed from February  through December 2002 in accordance with generally accepted  government auditing standards. See appendix I for more detailed  discussion of our scope and methodology.
subsections: section_title: Background
paragraphs: The two most common types of hemophilia are a deficiency in clotting  factor VIII, hemophilia A, and a deficiency in clotting factor IX, hemophilia  B. Hemophilia can be mild, moderate, or severe depending on the amount  of the clotting factor present in the blood. People with severe hemophilia,  for example, have less than 1 percent of the normal level of clotting factor  VIII or IX. The level of clotting factor deficiency contributes to the risk  that a particular bleeding episode poses to an individual. In individuals  with severe hemophilia, bleeding into the joints and adjoining tissues can  occur spontaneously, without an actual injury. Persons with mild  hemophilia usually experience prolonged bleeding only after surgery or a  major trauma, such as a head wound.
subsections: section_title: Hemophilia Is Treated with Clotting Factor
paragraphs: Historically, people with hemophilia relied on high-volume transfusions of  whole blood or plasma for treatment. These treatments, however, did not  provide enough clotting factor to stop serious bleeding and could be  performed only in a medical facility. With the introduction in the 1960s of  concentrated clotting factor products that could be infused at home,  hemophilia began to be more effectively and conveniently treated.
Early clotting factor products were produced from human plasma.  Recombinant clotting factor products, which are genetically engineered or  cloned, were introduced in the 1990s to reduce the risk of blood-borne  infections. New manufacturing processes and safety protocols have also  reduced the risk of infections to individuals using plasma clotting factor  products. Because recombinant products are not derived from human  plasma, they are generally considered the current treatment of choice,  although many older individuals continue to use plasma products. There is  not enough recombinant clotting factor manufactured to treat all  individuals with hemophilia.
Both plasma and recombinant clotting factor are biological substances  that differ in many respects from conventional, chemically synthesized  drugs. For example, biologicals such as clotting factor are derived from  living sources, so the concentration and potency of the original source  material can vary. Furthermore, biologicals cannot be manipulated during  the manufacturing process in a way that produces a consistent and precise  yield of product. As a biological product, clotting factor is susceptible to  microbial contamination and sensitive to environmental conditions, such  as temperature.
Individuals with hemophilia generally self-infuse clotting factor. Clotting  factor can be infused on demand, when a bleeding episode occurs, or for  prevention, known as prophylactic use. By self-infusing, individuals can  avoid waiting for care at a medical facility. Timely infusion relieves short- term pain and swelling and helps prevent chronic joint disease, which  results from recurrent bleeding into the joints. Prophylactic infusions can  be intermittent, such as before major surgery, or continuous, to prevent  uncontrolled bleeding over time. Continuous prophylactic infusion is  generally confined to younger individuals to prevent prolonged bleeding  episodes and long-term complications. Physicians prescribe a dosage of  clotting factor units that is based on the nature of treatment. Generally,  younger and smaller individuals are prescribed lower quantities of clotting  factor than older and larger individuals.
Because people infuse clotting factor in large doses, a substantial quantity  is used annually in the United States. Total clotting factor use is about 1  billion units per year. Although the average annual use of clotting factor  VIII for a person with hemophilia A is 78,000 units, individual use varies  widely. In any given year, approximately 23 percent of individuals with  hemophilia use no clotting factor at all, while a very small percentage of  individuals may use more than 500,000 units.
section_title: Characteristics of Medicare Beneficiaries with Hemophilia
paragraphs: According to CDC estimates, 6 percent of the hemophilia population, or  about 1,100 individuals, are Medicare beneficiaries. The average age of a  Medicare beneficiary with hemophilia is 53, nearly three decades older  than the average age of the total hemophilia population, which is 24. In  addition, Medicare beneficiaries with hemophilia show higher rates of  chronic joint disease and two viral infections, hepatitis C and human  immunodeficiency virus (HIV), than the general hemophilia population.  Because clotting factor products were not available when most Medicare  beneficiaries were young, they typically experienced prolonged and  repeated bleeding episodes, a situation that in vulnerable joint areas leads  to the destruction of joint tissues. As a result, 28 percent of Medicare  beneficiaries with hemophilia have chronic joint disease, compared to 14  percent of the general hemophilia population. Also, because many  Medicare beneficiaries began using clotting factor products before the  blood supply was tested for hepatitis C and HIV and before recombinant  products were available, beneficiaries have high rates of infection with  those viruses: 60 percent have hepatitis C and 45 percent have HIV. For the  total hemophilia population, the rates of hepatitis C and HIV infection are  39 and 24 percent, respectively.
The Medicare beneficiary subpopulation and overall hemophilia  population do not differ, however, in terms of the frequency of disease  type or severity of clotting factor deficiency (see table 1). Also, the annual  use of clotting factor among Medicare beneficiaries and the overall  population with hemophilia is similar.
section_title: Small Number of Providers Buy Clotting Factor Directly from Manufacturers
paragraphs: A small number of providers and manufacturers are involved in the  clotting factor market. The two main types of providers, HTCs and  homecare companies, furnish clotting factor and related ancillary supplies  to individuals with hemophilia. These providers obtain clotting factor  directly from the six clotting factor manufacturers. Providers rarely  purchase from distributors.
subsections: section_title: HTCs and Homecare Companies Provide Clotting Factor
paragraphs: HTCs and homecare companies are the two main providers of clotting  factor. HTCs provide annual checkups and ongoing medical care, physical  therapy, and social and other services to persons with hemophilia. HTCs  are located in 47 states, the District of Columbia, Puerto Rico, and Guam  and treat an average of about 90 hemophilia patients each. Approximately  half the HTCs, 67 out of 137, can furnish clotting factor and related  ancillary supplies to individuals they treat.
Homecare companies are the main source of clotting factor for individuals  who do not obtain their clotting factor from HTCs. There are several large  national homecare companies, as well as smaller regional companies.  Homecare companies ship drugs and related ancillary supplies directly to  individuals with chronic conditions. While homecare companies do not  provide physician services to their patients, they may provide nursing  services, patient education, community outreach, and case management.  Homecare companies can ship clotting factor to individuals throughout  the United States through their licensed pharmacies.
section_title: Small Number of Clotting Factor Manufacturers Contribute to Periodic Product Shortages
paragraphs: There are six manufacturers of clotting factors VIII and IX that sell directly  to HTCs and homecare companies. In addition, distributors buy the small  amount of clotting factor, approximately 5 percent of all clotting factor  delivered in the United States, that manufacturers have not sold to HTCs,  homecare companies, or other medical entities such as hospitals. These  distributors sell to HTCs, homecare companies, and hospitals and other  medical entities to meet their emergency or short-term needs. (See fig. 1  for a depiction of the clotting factor market.)
Shortages of particular clotting factor products occur periodically.  Because the six manufacturers run at capacity, a decrease in production  by any one reduces availability of a particular product and strains the  general clotting factor supply. Increasing clotting factor production in  response to a shortage is difficult. Manufacturing clotting factor takes an  average of 6 months; opening an additional plant can take several years. In  2001, there was a severe shortage of recombinant clotting factor VIII when  production problems at one manufacturer occurred concurrently with a  routine maintenance shutdown by another. Many individuals were unable  to obtain recombinant products at that time, causing them to rely on  plasma clotting factor, straining its supply as well. Because some HTCs  and homecare companies could not obtain the needed clotting factor  products from manufacturers, they turned to distributors to obtain  alternative products.
section_title: Providers Obtain Clotting Factor Products for Substantially Less than Medicare’s Payment
paragraphs: HTCs and homecare companies are able to purchase clotting factor at  prices considerably lower than Medicare’s payment for clotting factor.  Almost all HTCs that provide clotting factor participate in a federal  program that allows them to obtain prices from manufacturers that are 35  to 48 percent below AWP. Homecare companies can obtain prices that  range from 22 to 40 percent below AWP. While clotting factor shortages  can affect providers’ ability to procure specific products for their  customers, HTCs and homecare companies do not generally face higher  acquisition prices from manufacturers during periods of product  shortages.
subsections: section_title: Providers Obtain Large Discounts from AWP
paragraphs: In an analysis of 2001 and first quarter 2002 data, we found that HTCs  purchase clotting factor from manufacturers at a 35 to 48 percent discount  from AWP. The largest discounts are for plasma clotting factor VIII  products, and the smallest discounts are for recombinant clotting factor  VIII products, with the discounts for clotting factor IX products falling in  between. HTCs obtain these substantial discounts through the Public  Health Service 340B program, which enables certain federally funded  entities to buy drugs directly from manufacturers at discounted prices.  The 340B prices, which are updated quarterly, equal a set discount from a  manufacturer’s price.
Our analysis of data from 2001 and 2002 shows that homecare companies  can also purchase clotting factor from manufacturers at prices  substantially below Medicare’s payment. With prices from 22 to 40  percent below AWP, the discounts that homecare companies receive are  somewhat less than those received by HTCs. Like HTCs, homecare  companies receive the largest discounts on plasma clotting factor VIII  products and the smallest on recombinant clotting factor VIII products,  with discounts for clotting factor IX products falling in between.
section_title: Providers Do Not Generally Face Higher Prices during Shortages
paragraphs: Because most HTCs obtain their prices through a federal discount  program, they are typically protected from price increases during periods  of product shortage. According to certain homecare companies and other  stakeholders we interviewed, shortages do not result in price fluctuations  for homecare companies over the course of the contracts they sign with  manufacturers. During shortages, sufficient supplies of particular clotting  factor products may not be available directly from manufacturers. In such  rare cases, providers may pay higher prices to other entities, mainly  distributors, to secure needed products. However, a distributor we spoke  with sold clotting factor products to providers at prices that were still  lower than Medicare’s payment.
section_title: Providers Incur Costs Associated with Delivering Clotting Factor to Medicare Beneficiaries That Are Not Separately Reimbursed
paragraphs: Providers incur costs associated with delivering clotting factor that are not  separately reimbursed by Medicare. We estimate that total delivery costs  in 2000 and 2001 ranged from $0.03 to $0.08 per unit of clotting factor sold  by HTCs. We did not receive enough data from homecare companies to  estimate their costs. Delivery costs are generated in inventory  management, storage, shipping, and the provision of ancillary supplies  necessary for the infusion of clotting factor. Providers may also furnish  other services for which they are not separately reimbursed, such as  patient education and community outreach. These services are not  Medicare-covered benefits, and they are generally targeted to younger  patients who are not Medicare beneficiaries.
subsections: section_title: Delivering Clotting Factor Generates Dispensing and Ancillary Supply Costs
paragraphs: Medicare does not make a separate payment for the costs of delivering  clotting factor, including costs associated with inventory management,  storage and shipping, and the provision of ancillary supplies. Due to its  complex dosing protocols and biological properties, clotting factor  requires considerable inventory management. Because the number of units  of clotting factor prescribed is determined by an individual’s size and  treatment needs, each prescription is specific to the individual. However,  manufacturers sell vials of clotting factor in only three standard  concentrations: 250, 500, or 1,000 units per vial. Furthermore, the  unpredictability involved in manufacturing a biological substance like  clotting factor results in manufacturers’ inability to predetermine the  precise concentration of clotting factor in a particular vial; they can only  predict its concentration within 10 percent of the standard concentration.  Therefore, a small-sized vial may be labeled anywhere from 225 to 275  units, and a large-sized vial may be labeled anywhere from 900 to 1,100  units. Managing clotting factor inventory requires more staff time than  managing the inventory of conventional drugs, in large part due to the  variations across individual prescriptions and the variable concentrations  in individual vials.
Inventory management is further complicated by product recalls as well as  shortages. If a specific product or concentration is not available as a result  of a product recall or shortage, the provider must allocate additional staff  time to consult with an individual’s physician to determine an alternate  plan of clotting factor treatment until the preferred product is available  again. One provider we spoke with said that product recalls of clotting  factor occur more often than for other drugs because of sensitivity to the  possibility of blood-borne infection resulting from the use of clotting  factor. In 2001, there was one recall of a clotting factor VIII and one recall  of a clotting factor IX product.
Clotting factor providers also incur costs associated with storing and  shipping clotting factor. Providers order tens of thousands of units of  clotting factor a year for each patient. Because clotting factor must be  refrigerated to prevent spoilage, the high volume of clotting factor stored  by providers requires large temperature-controlled areas with sources of  backup power. The shipment of clotting factor also involves special  arrangements. Glass vials of clotting factor must be securely wrapped to  prevent breakage and then packed with coolants. Providers ship the  products using overnight delivery services that track and monitor the  product along the delivery route to ensure that it is delivered to the  individual’s door at a specific time. Many providers have staff available 24  hours a day to ship clotting factor to patients during emergencies. Some  providers insure their shipments, while others absorb the cost of any  product lost, damaged, or spoiled during shipment.
Providers incur costs for furnishing ancillary supplies necessary to infuse  clotting factor to individuals. These include needles, syringes, alcohol  wipes, bandages, medical tape, sterile gloves, tourniquets, and needle  disposal containers.
According to our analysis of data from four HTCs, the costs to HTCs for  dispensing clotting factor and providing ancillary supplies directly to  patients ranged from $0.03 to $0.08 per unit of clotting factor based on  data from 2000 and 2001. We did not receive enough data from homecare  companies to estimate their costs. Delivery costs reflect fixed charges,  such as rent and insurance, and costs that vary by the quantity of clotting  factor sold, such as shipping and ancillary supplies. Therefore, providers’  per unit costs may depend on their overall product volume and the size of  the individual orders.
section_title: Services Related to Clotting Factor Are Not Targeted towards Medicare Beneficiaries
paragraphs: HTCs and homecare companies state that they provide services related to  hemophilia, such as nursing services, patient education, education on  hemophilia to schools and community organizations, and case  management, that are not separately reimbursed by Medicare and must be  covered through clotting factor payments. To the extent that Medicare  beneficiaries receive services incident to a physician visit, such as case  management at an HTC or physician’s office, these services are  compensated through Medicare’s payment for the physician visit. Other  services are not covered under the Medicare program and predominantly  target families with young children and the schools and other community  institutions they attend.
section_title: Conclusions
paragraphs: Medicare’s payment for clotting factor delivered on an outpatient basis is  flawed in the same way that its payment is flawed for other outpatient  prescription drugs. In tying its payment to AWP, Medicare has been paying  substantially more than providers’ actual acquisition costs. The provider  discounts that we report result in acquisition costs that are substantially  below Medicare’s payment. However, the lowest prices, those from the  340B program, are not available to all Medicare providers of clotting  factor.
Providers also incur costs in delivering clotting factor related to inventory  management, specialized storage, shipping procedures, and in providing  ancillary supplies. These costs are not separately paid by Medicare. While  we can only estimate the amount of delivery costs, overpayments on  clotting factor are sufficiently high to more than cover them. However, we  believe that Medicare overpayments for some services should not be used  to compensate for the lack of payments for others.
section_title: Recommendations for Executive Action
paragraphs: We recommend that the Administrator of CMS establish a Medicare  payment for clotting factor delivered on an outpatient basis that is more  closely related to providers’ acquisition costs. Medicare’s payment for  clotting factor should reflect actual market transaction prices. When  Medicare’s payment for clotting factor more closely reflects acquisition  costs, we recommend that the Administrator establish a separate payment  for providers based on the costs of delivering clotting factor to Medicare  beneficiaries.
section_title: Agency Comments
paragraphs: In commenting on a draft of our report, HHS noted that our findings  expand upon those in earlier reports by us and the HHS OIG on Medicare  payment for outpatient drugs to specifically include information on  payments for clotting factor. HHS agreed that Medicare should  appropriately pay for clotting factor and services related to furnishing  clotting factor. HHS’s written comments are in appendix II. The agency  also provided technical comments, which we incorporated where  appropriate.
We also provided a copy of the draft to representatives of two hemophilia  associations, the National Hemophilia Foundation and the Hemophilia  Federation of America, for oral comment. They agreed with our  recommendations and provided technical comments, which we  incorporated where appropriate.
As agreed with your office, unless you publicly announce the contents of  this report earlier, we plan no further distribution of it until 30 days from  the date of this report.  We will then send copies of this report to the  Secretary of HHS and the Administrators of CMS and HRSA.  The report is  available at no charge on GAO’s Web site at http://www.gao.gov.  We will  also make copies available to others on request.
If you or your staff have any questions, please call me at (202) 512-7119 or  Nancy A. Edwards at (202) 512-3340. Other major contributors to this  report include George H. Bogart, Beth Cameron Feldpush, and   Yorick F. Uzes.
section_title: Appendix I: Scope and Methodology
paragraphs: In conducting this study, we analyzed data from the Centers for Medicare  & Medicaid Services (CMS), the Health Resources and Services  Administration (HRSA), and the Centers for Disease Control and  Prevention (CDC). We also analyzed data from 11 hemophilia treatment  centers (HTC) and 2 homecare companies. We interviewed officials at the  Department of Health and Human Services Office of Inspector General, 2  patient advocacy organizations, 4 clotting factor manufacturers, 2 of the 5  largest distributors, and several HTCs and homecare companies.
To obtain demographic and treatment information on the hemophilia  population and Medicare subpopulation, we used data from the 1993-1998  CDC Hemophilia Surveillance System Project, generally recognized as the  most complete and accurate data available. Through this project, CDC  collected medical records data on persons with hemophilia to estimate its  national prevalence. We used these data to determine characteristics of  Medicare beneficiaries with hemophilia and compare them to the overall  population with hemophilia.
To determine Medicare expenditures for clotting factor products, we used  2001 data from the Medicare Part B Extract and Summary System, which  are the most recent data available. We limited our analysis to four clotting  factor payment categories of recombinant clotting factor VIII, plasma  clotting factor VIII, recombinant clotting factor IX, and plasma clotting  factor IX. These categories constituted over 90 percent of Medicare  expenditures on clotting factor in 2001.
We determined clotting factor acquisition prices for the two major  providers of clotting factor, HTCs and homecare companies. For HTCs, we  obtained 2001 and first quarter 2002 340B acquisition prices directly from  HRSA. The 340B prices are the discounted prices that HTCs receive  through their participation in a federal program.
We obtained 2002 homecare acquisition prices from two homecare  companies, which we supplemented with two other sources. First, we  used 2001 and first quarter 2002 average manufacturer price (AMP) data  obtained from CMS. AMP reflects the average price paid to a manufacturer  by a purchaser for a drug, excluding 340B prices, other federal prices, and  sales to hospitals and health maintenance organizations. Because of the  limited number of provider types involved in the clotting factor market,  the exclusion of 340B prices from AMP calculations, and the small market  share of distributors, AMP is a satisfactory proxy for homecare acquisition  prices. Second, we used acquisition prices from 2001, which we received  from an HTC association, for seven HTCs that had purchased clotting  factor outside of the 340B program. We combined these three data sources  into a list of acquisition prices for 2001 and 2002.
To obtain the estimated discounts from the average wholesale price  (AWP) for each provider type, we first averaged the acquisition prices  within product category and year for each of our four data sources: the  340B prices, the homecare company acquisition prices, the AMP prices,  and the HTC non-340B acquisition prices. We obtained AWP data from the  2001 and 2002 Drug Topics Red Book. To obtain AWP discounts, we  calculated the difference between the corresponding AWP and the average  acquisition prices to find the average discount, by product category and  year, for each of the four data sources. We then determined the range of  HTC discounts by listing the highest and lowest average discounts among  the four product categories for 2001 and first quarter 2002 340B prices. We  determined the range of homecare company prices by listing the highest  and lowest average discounts among the four product categories for 2002  homecare prices, 2001 and first quarter 2002 AMP prices, and 2001 HTC  non-340B prices.
To identify the categories of additional costs that providers incur in  delivering clotting factor, we relied on structured interviews with  providers. From information obtained in our interviews, we developed  cost categories and asked providers to give us their operating costs for  each of these categories for 1 full year and the total number of clotting  factor units they purchased during that year. Some HTCs were unable to  provide this information because they were financially associated with  larger institutions, such as hospitals, and could not separate their costs  from those of the institutions. We did obtain costs from four HTCs and  used these data to determine the range of HTC additional costs. We did not  receive enough data from homecare companies to estimate their costs.
section_title: Appendix II: Comments from the Department of Health and Human Services