Healthcare Law Blog

Shaping the World of Healthcare Law

A major California-based health care system, Sutter Health, and several of its medical practice foundation affiliates have agreed to pay a total of $90 million to settle allegations that they violated the False Claims Act (“FCA”) by knowingly submitting inaccurate information about the health status of beneficiaries enrolled in Sutter Health’s contracted Medicare Advantage (“MA”) Plans.[1]  The Sutter Health settlement is the largest FCA settlement ever paid by a health care provider for alleged MA fraud.…
On August 2, 2021, the Centers for Medicare and Medicaid Services (“CMS”) issued its hospital inpatient prospective payment system (“IPPS”) final rule (“Final Rule”) for fiscal year 2022. In addition to a number of other changes, the Final Rule repeals the price transparency requirement for hospitals, discussed in our September 2, 2020 blog post, obligating hospitals to report certain contract terms with Medicare Advantage (“MA”) plans for cost reporting periods ending on or after January 1, 2021.…
Health plans and issuers racing to implement overlapping price transparency and disclosure requirements in response to the Transparency in Coverage final rule (TiC Final Rule) and the Consolidated Appropriations Act, 2021 (CAA) received a welcome reprieve via guidance published August 20. The Departments of Labor, Health and Human Services (HHS), and the Treasury (collectively, the Departments) announced that they would exercise enforcement discretion and defer enforcement of requirements that plans and issuers publish machine-readable files for in-network rates and out-of-network allowed amounts and billed charges until July 1, 2022 instead of January 1, 2022. The Departments also explained that…
On August 10, 2021, the Senate passed H.R. 3684, a roughly $1 trillion infrastructure bill (the “Infrastructure Bill”) that authorizes funds for federal-aid highways, transit, broadband access and other infrastructure purposes.  Notably, the Infrastructure Bill is paid for in part through changes to several healthcare policies, including delaying a Medicare Part D rebate rule for an additional three years and reducing Medicare payment amounts to providers.  The Infrastructure Bill’s changes to healthcare policies provide a mixed impact to health care industry stakeholders, with both expected benefits and burdens to providers, payers, and drug manufacturers.…
On August 10, 2021, the Centers for Medicare and Medicaid (“CMS”) published a proposed rule (“Proposed Rule”) to rescind the Most Favored Nation Model (“MFN Model”) interim final rule that was published on November 26, 2020 (“Interim Final Rule”).  As described in our December 2020 blog post, the Interim Final Rule established a seven-year nationwide, mandatory MFN Model that would test an alternative way for Medicare to pay for certain Medicare Part B single source drugs and biologicals.  The MFN Model, originally set to begin January 1, 2021, would have tied the prices for certain Part B single-source drugs…
On July 30, 2021, the Special Inspector General for Pandemic Recovery (“SIGPR”), Brian D. Miller, submitted his quarterly report to Congress.  SIGPR was created as an independent watchdog of the Department of the Treasury under the CARES Act.  It is tasked with investigating fraud and abuse of federal stimulus funds in response to COVID-19, and works in collaboration with law enforcement and U.S. Attorney’s Offices throughout the country.  These investigative efforts have resulted in civil and criminal enforcement actions against recipients of federal funding throughout the country, and such enforcement action investigations are sure to continue.  The quarterly report showed…
On August 13, 2021, the D.C. Circuit Court of Appeals reversed a district court opinion vacating CMS’ Overpayment Rule, 42 C.F.R. 422.326, for Medicare Advantage organizations (“MAOs”).  UnitedHealthcare Insurance Co. et al. v. Becerra et al., case number 18-5326.  As a result of this decision, CMS can once again rely on the Overpayment Rule to impose voluntary refund obligations for MAOs.  MAOs – already subject to significant government enforcement related to their risk adjustment coding practices – should carefully consider the implications of this decision for their coding and auditing practices.…
Introduction CMS’ most recent Stark Law rulemaking includes important changes to the rules that allow physician practices to satisfy the definition of “Group Practice” while distributing designated health services (“DHS”) – based profit shares and productivity bonuses. 85 Fed. Reg. 77492 (Dec. 2, 2020) (the “Final Rule”).  As these changes go into effect January 1, 2022, and the ability to bill Medicare for DHS is often contingent on satisfying the definition of “Group Practice,” physician practices should take action now to assess their physician compensation arrangements and methodologies under the new rules.…
On July 1, 2021, the California Department of Public Health (“CDPH”) issued new regulations[1] (the “Regulations”) effective immediately that more narrowly limit the circumstances under which instances of unauthorized access to medical information have to be reported to CDPH.  The new regulations also give CDPH more discretion to adjust penalties for violations.  The Regulations complement Section 1280.15 of the Health and Safety Code (“Section 1280.15”) requiring state-licensed clinics, health facilities, home health agencies, and hospices to prevent any unlawful or unauthorized access to, or use or disclosure of, a patient’s medical information, and to report any unauthorized…
On July 13, 2021, the Centers for Medicare & Medicaid Services (“CMS”) unveiled a proposal to temporarily extend Medicare coverage for particular telehealth services granted during the COVID-19 public health emergency (the “Pandemic”), in order to evaluate which services should be covered permanently. Through the 2022 Physician Fee Schedule (“PFS”), CMS is allowing certain services to remain on the telehealth list until the end of December 31, 2023.…
On July 16, 2021, Governor Newsom signed California Assembly Bill 150 into law, allowing certain owners of passthrough entities to find a way around the current $10,000 federal cap on state and local tax (SALT) deductions for individuals.  The new law, applicable to tax years beginning on or after January 1, 2021 and ending before January 1, 2026, allows for many partnerships, limited liability companies taxed as partnerships, and S-Corporations to pay an entity level tax based on electing individual owners’ share of income, and then grants the owners a credit against California personal income tax for the full amount…
The public health crisis (the “Pandemic”) brought more attention, and more money, to the use of digital technologies to provide remote services to millions of individuals affected by the Pandemic. The use of digital technologies to provide medical services otherwise known as “telehealth”, exploded during the Pandemic but has since then made a steady growth across the healthcare industry, with many realizing the value of using digital technology to supplement, and in some cases, replace traditional methods of medical care. While many expected the value and investment in telehealth to decline with Pandemic restrictions being lifted, a recent report from
On July 13, 2021, the Centers for Medicare and Medicaid Services (“CMS”) released a Proposed Rule that proposes to amend certain regulations implementing the Physician Self-Referral Law, otherwise known as the “Stark Law”. The Proposed Rule proposes to revise once again the definition of “indirect compensation arrangement” (ICA), effectively to revert the meaning of the definition back – for the vast majority of indirect financial relationships between DHS entities and referring physicians – to the definition of that term as it was in place prior to the latest Stark Law rulemaking, “Modernizing and Clarifying the Physician Self-Referral Regulations”…
On June 23, 2021, Delaware Governor John Carney signed House Bill 160, the Telehealth Access Preservation and Modernization Act of 2021 (the “Bill” or “HB160”) which continues and enhances Delaware residents’ access to telehealth services and, through the adoption of the Interstate Medical Licensure Compact (the “Compact”), ensures that telehealth services can be provided through qualified medical practitioners in a streamlined and efficient pathway to licensure that, according to the Bill’s supporters, meets the health care delivery system needs of the 21st century.…
In July 2020, we discussed a ruling by the D.C. Court of Appeals upholding the Department of Health and Human Services’ (HHS) site-neutral payment rules. On Monday, June 28, 2021, the Supreme Court declined, without comment, to hear an appeal from the American Hospital Association (AHA) and other provider groups asking it to reverse this ruling.…
Now approaching a year-long battle, drug manufacturers and 340B covered entities, which include hospitals and community health centers, participating in the 340B Drug Pricing Discount Program (“340B Participants”) continue to dispute the issue of whether drug manufacturers are required to give 340B Participants discounts on drugs dispensed through contract pharmacies.  The most recent point of contention involves the U.S. Health Resources and Services Administration’s (“HRSA”) May 17, 2021 letters sent to six drug manufacturers stating that the manufacturers’ actions to limit access to 340B Program pricing for 340B Participants who dispense drugs through contract pharmacies is in direct violation of…