Archives: Hospitals and Health Systems

Subscribe to Hospitals and Health Systems RSS Feed

One-Two Punch: On Consecutive Days, DOJ Announces High Dollar Fraud and Abuse Settlements with Hospitals

The Department of Justice (DOJ) announced two significant False Claims Act (FCA) settlements in recent days that signal continued close government scrutiny of billing, coding and referral practices at hospitals.

On August 2, DOJ announced an $84.5 million dollar settlement with Michigan-based health system William Beaumont Hospital. The settlement resolves allegations of non-compliance with the Anti-Kickback Statute (AKS) and Stark Law arising from “improper relationships with eight referring physicians” that led to the submission of false claims to government health care programs.

DOJ alleged that the defendant provided compensation substantially …

Connecticut Enacts Law Revising Various Department of Public Health Statutes

On June 13, 2018, Connecticut Governor Dannel P. Malloy signed into law Public Act No. 18-168 “An Act Concerning the Department of Public Health’s Recommendations Regarding Various Revisions to the Public Health Statutes” (PA 18-168). This legislation makes a number of changes to state laws concerning public health and the responsibilities of the Department of Public Health (DPH), including laws affecting advanced practice registered nurses (APRNs), advance directives, the scope of practice for podiatry, respiratory care, reportable events at nursing homes, and the supervision of physician assistants. …

New Connecticut Legislation Updates Laws Concerning Urgent Care Centers, Hospital-Based Facility Fees and Freestanding Hospital Emergency Departments

On June 12, 2018, Connecticut Governor Dannel P. Malloy signed into law Public Act No. 18-149 “An Act Concerning Outpatient Clinics, Urgent Care Centers and Freestanding Emergency Departments” (PA 18-149). This legislation makes several changes to Connecticut laws concerning urgent care centers, facility fees charged at off-site hospital-based facilities, and freestanding emergency departments. PA 18-149 is effective as of October 1, 2018.…

Recent Joint Commission Guidance Recommends Steps for Health Care Organizations to Reduce Workplace Violence

Workplace violence is a risk at any health care workplace. Whether from patients, residents, clients, or employees. The Occupational Safety and Health Administration (“OSHA”) estimates that three quarters of all workplace assaults reported annually – approximately 19,000 – occurred in health care and social service settings.

While OSHA does not have any specific regulations addressing violence in the workplace, OSHA’s General Duty Clause applies to covered employers and requires they provide their employees with a place of employment that is “free from recognized hazards that are causing or are likely …

Connecticut Enacts Legislation to Address Hospital-Insurer Network Conflicts

On June 6, 2018, Connecticut Governor Dannel P. Malloy signed into law Public Act No. 18-115 “An Act Concerning Disputes Between Health Carriers and Participating Providers That Are Hospitals” (PA 18-115). This legislation updates state laws concerning the departure or removal of a hospital from an insurance carrier’s provider network. PA 18-115 takes effect July 1, 2018.…

Connecticut Enacts Law to Limit Automatic Prescription Refills for Medicaid Beneficiaries

On June 1, 2018, Connecticut Governor Dannel P. Malloy signed into law Public Act 18-77 “An Act Limiting Auto Refills of Prescription Drugs Covered Under the Medicaid Program and Requiring the Commissioner of Social Services to Provide CHIP Data to the Health Information Technology Officer” (PA 18-77). This legislation allows the Department of Social Services (DSS) to prohibit pharmacies from automatically refilling certain prescription drugs for Medicaid beneficiaries and prohibits DSS from paying for refills of such drugs unless it receives a request for payment from the beneficiary …

Connecticut Legislature Revises DSS Provider Audit Processes

On June 1, 2018, Connecticut Governor Dannel P. Malloy signed into law Public Act No. 18-76 “An Act Concerning Audits of Medical Assistance Providers” (PA 18-76), which makes several changes to the Medicaid provider audit process conducted by or on behalf of the Connecticut Department of Social Services (DSS). PA 18-76 is effective July 1, 2018.…

HHS Delays 340B Program Final Rule on Drug Ceiling Price and Manufacturer Civil Monetary Penalties (Again)

On June 1, 2018, the Health Resources and Services Administration (HRSA) announced it was once again delaying the final rule that had set forth the calculation for the 340B Program ceiling price and drug manufacturer civil monetary penalties (Final Rule).  Enforcement on the Final Rule is delayed to July 1, 2019. …

Connecticut Legislature Operationalizes New Health Oversight Agency: The Office of Health Strategy

On May 14, 2018, Connecticut Governor Dannel P. Malloy signed into law Public Act No. 18-91 “An Act Concerning the Office of Health Strategy” (PA 18-91), a bill that operationalizes the Office of Health Strategy (OHS), a new health oversight agency in Connecticut. OHS is a division of the Department of Public Health (DPH) “for administrative purposes only” that was provisionally established by the Connecticut General Assembly within the budget implementer bill passed in a special session in late 2017 and accorded responsibility for developing and implementing a …

DOJ Enters Into Largest-Ever Civil Settlement with Hospital for Drug Diversion

On May 16, 2018, the U.S. Attorney’s Office for the Southern District of Georgia announced that it had entered into the “largest hospital drug diversion civil penalty settlement in U.S. History” in the amount of $4.1 million dollars.  The settlement with a Georgia hospital resolves allegations that the hospital “failed to provide effective controls and procedures to guard against theft and loss of controlled substances” that resulted in tens of thousands of 30mg oxycodone tablets being unaccounted for and believed to have been diverted for illegal uses over a four …

DOJ Intervenes in False Claims Act Case Against Insys Therapeutics

The Department of Justice (DOJ), recently intervened in a civil False Claims Act (FCA) case filed against Insys Therapeutics, Inc. (Insys) in the Central District of California that alleges FCA violations arising from the payment of kickbacks in violation of the Anti-Kickback Statute (AKS) as well as other fraudulent activities. Insys is an embattled Arizona-based pharmaceutical manufacturer of a highly-addictive sublingual opioid spray known as Subsys, and is currently the subject of a number of criminal and civil suits ongoing across the country (certain of which were consolidated into this …

US District Court Holds Medical Executive Committees Can Sue And Be Sued

On April 27, 2018, the United States District Court for the District of New Jersey held that the Medical Executive Committee (“MEC”) of a hospital, which is comprised of doctors that decide who is given privileges within the hospital, can sue and be sued. Nahas v. Shore Med. Ctr., 2018 U.S. Dist. LEXIS 70785.…

DOJ Announces Criminal Conviction of Physician for HIPAA Violation

On April 30, 2018 a Massachusetts physician was convicted of a criminal violation of the Health Insurance Portability and Accountability Act of 1996 (HIPAA), as well as one count of obstruction of a criminal health care investigation, in a Massachusetts federal court. The convictions relate to the purported sharing of confidential patient information by the physician with pharmaceutical sales representatives that allowed the pharmaceutical company to target patients with specific conditions (and to correspondingly facilitate the receipt of prior authorizations for the company’s drugs from patients’ insurers).…

State Enforcement Actions Demonstrate Continued Scrutiny of Health Care Fraud

A series of criminal and civil enforcement actions announced in recent weeks demonstrate the continued attention that state regulators throughout the Northeast are placing on health care fraud. These actions, and the significant sanctions imposed by courts and the government, can serve as a reminder that violators of health care fraud laws are subject to scrutiny at both the federal and state levels (often simultaneously), and that such violations can create exposure to significant civil and criminal penalties.…

CMS Issues National Coverage Determination On Next Generation Sequencing For Advanced Cancer

On March 16, 2018, the Centers for Medicare & Medicaid Services (CMS) issued a Decision Memo for Next Generation Sequencing (NGS) for Medicare beneficiaries with advanced cancer (CAG-00450N). In the memo, CMS concluded that NGS as a diagnostic laboratory test is reasonable, necessary and covered nationally when performed in a CLIA-certified laboratory, ordered by a treating physician, and certain additional patient-status and testing requirements are met. The memo outlines these requirements and specifies the criteria that Medicare Administrative Contractors (MACs) must use to determine coverage for NGS as a diagnostic …

Bipartisan Budget Act Revises Stark Law, Increases Penalties for AKS and CMP Law Violations, and Expands Telehealth Coverage

On February 9, 2018, Congress passed the Bipartisan Budget Act of 2018 (the Act), which included a number of important health law provisions..

AKS and CMP Violations

Under the Act, Congress doubled the statutory civil fines for certain violations of the Anti-kickback Statue (AKS) and adjusted certain fines under the Civil Monetary Penalty (CMP) Law. The Act also increased the maximum criminal penalty from $25,000 to $100,000 and increased the maximum incarceration period from five years to ten years.…

Recent Anti-Kickback Cases Emphasize Government Scrutiny of Speaker’s Bureaus and Lavish Meals Funded by Pharmaceutical and Device Manufacturers

The Department of Justice (DOJ) recently resolved two health care fraud cases – one criminal and one civil – that demonstrate the government’s continued scrutiny of lavish meals and “speaker’s bureaus” sponsored by pharmaceutical and device manufacturers as potential avenues for the payment of kickbacks to physicians for referrals of health care items and services. These cases indicate the criminal and civil risk that providing lavish meals or purported speaker’s bureau payment can pose, and the corresponding need to proactively assess the legitimacy of such programs and events.…

CMS Revises National Coverage Determination for Implantable Cardioverter Defibrillators

On February 15, 2018, the Centers for Medicare & Medicaid Services (CMS) issued a Decision Memo outlining revisions to its 2005 National Coverage Determination (NCD) for Implantable Automatic Defibrillators (ICDs) . The updated NCD  includes changes to the covered indications for ICDs, new patient criteria and exceptions to waiting periods for symptomatic patients with certain histories before an ICD will be considered a covered device by Medicare. The final updates follow CMS’ review of comments received following its release of a Proposed Decision Memorandum in November 2017. The Decision Memo …

CMS Extends Hospital and CAH Attestation Deadline

The Centers for Medicare & Medicaid Services (CMS) has extended the eligible hospital and critical access hospital (CAH) attestation deadline from February 28, 2018 to March 16, 2018. The extension provides additional time to submit attestation data and electronic clinical quality measure (eCQM) data. Eligible hospitals and critical access hospitals attesting to the CMS Electronic Health Records (EHR) Incentive Program are required to submit data through the QualityNet Secure Portal (QNet). “Subsection (d) hospitals” that are paid under the Inpatient Prospective Payment System (IPPS), CAHs, and Medicare Advantage hospitals are …

Dumpster Diving Leads to $100,000 Fine for Defunct Business Associate Due to Improper Disposal of Medical Records

On February 13, 2018, the HHS Office for Civil Rights (OCR) announced a $100,000 settlement with a court-appointed receiver representing Filefax, Inc. (Filefax) arising from the 2015 discovery of medical records that contained protected health information (PHI) of over two thousand individuals in a dumpster. Filefax, a now-defunct medical records moving and storage company located in Illinois, acted as a business associate under HIPAA.

OCR initiated an investigation in February, 2015, after receiving an anonymous complaint concerning medical records that had been discovered and delivered to a facility for shredding …

Escobar Compels Florida District Court to Overturn $350 Million Jury Verdict Arising from Claims of Inadequate Documentation

Last month, a U.S. District Court in the Middle District of Florida overturned judgments totaling $347,864,285 returned by a jury under the federal False Claims Act (FCA) and Florida’s state equivalent against the owners and operators of 53 specialized nursing facilities in Florida, determining that the plaintiffs’ allegations failed to satisfy the “demanding” and “rigorous” materiality standard endorsed by the Supreme Court in its 2016 Escobar decision. In an order released January 11, 2018, the District Court reversed the jury’s conclusions and granted the defendants judgment as a matter of …

CMS Announces Change to Student Documentation Requirement Intended to Reduce Burden on Teaching Physicians

On February 2, 2018, the Centers for Medicare & Medicaid Services (CMS) released Transmittal 3971 (Change Request 10412), which revises a section of the Medicare Claims Processing Manual (Manual), that provides guidance regarding billing for Evaluation and Management (E/M) services involving students.  According to CMS, the Change Request is part of a broader goal to reduce the administrative burden on practitioners.…

CMS Considers 7-Day Limit on Initial Opioid Prescriptions under Part D

In a Draft Call Letter issued February 1, 2018, the Centers for Medicare & Medicaid Services (CMS) announced that it is considering a number of new strategies to address opioid overutilization within the Medicare Part D program.  CMS is particularly concerned with chronic overuse among beneficiaries taking high levels of prescription opioids (e.g., beneficiaries prescribed opioids with a 90 morphine milligram equivalent (MME) dose or higher per day), beneficiaries with multiple prescribers, and “opioid naïve” patients (i.e., patients newly prescribed opioids).

CMS’s strategies include consideration of a 7-day supply limit …

Connecticut Supreme Court Recognizes Common-Law Cause of Action for Unauthorized Disclosure of Confidential Medical Information

In a long-awaited decision concerning the confidentiality of medical records and patient privacy, the Connecticut Supreme Court recently concluded that the physician-patient relationship establishes a duty of confidentiality to a patient in Connecticut, and that unauthorized disclosure of confidential information obtained for the purpose of treatment in the course of that relationship gives rise to a cause of action in tort, unless the disclosure is otherwise permitted by law.

In Byrne v. Avery Center for Obstetrics and Gynecology, P.C., the Court considered – for a second time – the …

LexBlog