Archives: Hospitals and Health Systems

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2019 Physician Fee Schedule Rule Review: Supervision Requirements for Radiologist Assistants Reduced

In its 2019 Medicare Physician Fee Schedule Final Rule (PFS Rule), CMS finalized a regulatory change that updates supervision requirements for Registered Radiologist Assistants and Radiology Practitioner Assistants (collectively, RAs) to reduce the level of supervision necessary to perform diagnostic tests reimbursable by Medicare. Specifically, the PFS Rule revises 42 C.F.R. § 410.32(b) to provide that RAs may perform certain diagnostic tests that would otherwise require a personal level of supervision under direct supervision instead, to the extent permitted by state law and regulations.…

2019 Physician Fee Schedule Rule Review: Option to Extend MSSP Agreements for Currently-Expiring ACOs Finalized

On November 1, 2018, the Centers for Medicare & Medicaid Services (CMS) released its 2019 Physician Fee Schedule Final Rule (PFS Rule), which contains a number of significant substantive changes to Medicare payment practices and policies. The PFS Rule will be officially published in the Federal Register on November 23, 2018. The PFS Rule also includes an interim final rule implementing amendments to federal telehealth regulations to maintain consistency with recent changes to the Social Security Act to address the opioid crisis enacted in October 2018 through the …

OIG Issues Favorable Advisory Opinion for Trust Donations to Public-Private Research Institute Affiliated with a Health System Having Ongoing Business Relationships with Trustee-Owned Long-Term Care Facilities

On November 6, 2018, the Office of Inspector General (OIG) of the Department of Health and Human Services published a favorable Advisory Opinion regarding a proposed arrangement comprised of substantial donations that were earmarked for biomedical research purposes, made by a charitable trust (“Trust”) to a public-private medical research institute (“Research Institute”). The Research Institute had been formed by a health care system (“Health Care System”) and a public university (“University”). In addition, one of the Trustees planned to make a separate, individual donation to the Research Institute, through the …

Laws Affecting Health Care Entities in Connecticut Take Effect October 1, 2018

On October 1, 2018, a number of new laws affecting health care entities in Connecticut became effective. Below please find a brief description of some of the newly-effective provisions, as well as links to our analyses of the changes.…

Congress Considering Legislation Aimed at Curbing Surprise Medical Bills

The United States Senate is currently considering bipartisan legislation that would establish statutory limits on the financial exposure of certain patients to so-called “surprise” medical bills. The proposed legislation would amend the federal Public Health Service Act (at 42 U.S.C. § 300gg-19a) to prohibit surprise balance billing of patients receiving health care services in the following three situations: (1) Emergency services provided by a nonparticipating (i.e., out of network) provider in a nonparticipating facility; (2) Non-Emergency services following an emergency service at a nonparticipating facility; and (3) Non-Emergency services performed …

CMS Revises Hospital Inpatient Admission Order Documentation Requirements

On August 17, 2018, the Centers for Medicare & Medicaid Services (CMS) published its Hospital Inpatient Prospective Payment Systems final rule for Fiscal Year 2019 (Final Rule). The Final Rule contains a number of important updates to Medicare Part A that take effect October 1, 2018.

Among other provisions  in the Final Rule, CMS finalized its proposed update of the regulations that govern hospital admissions under Medicare Part A (42 C.F.R. § 412.3). Specifically, the Final Rule revises language in 42 C.F.R. § 412.3(a) to remove the current requirement that …

OIG Advisory Opinion Approves Surgical Device Warranty Program Intended to Reduce Readmissions

On September 17, 2018, the Office of Inspector General (OIG) of the Department of Health and Human Services published a favorable Advisory Opinion allowing a manufacturer of surgical devices and wound care products to offer a warranty program to hospital customers covering three joint replacement products (“Proposed Arrangement”).

Under the Proposed Arrangement, the manufacturer would refund hospitals for the combined purchase price of three of its products if a patient who received them as part of a joint replacement surgery was readmitted to the hospital within 90 days following the …

Medicare Proposes Revised Telehealth Services and Payments

The Centers for Medicare & Medicaid Services (CMS) recently published a Proposed Rule, primarily intended to modify certain Medicare payment policies.  The Proposed Rule contains several provisions that address the growing use of telehealth. CMS noted that it had received many suggestions regarding the expansion of access to telehealth as well as appropriate pay for the same, in response to its call for comments in the CY 2018 Medicare physician fee schedule (PFS) proposed rule.…

CMS Identifies “Pathway to Success” for Accountable Care in Proposed Rule that Would Significantly Change Shared Savings Program

On August 17, 2018, the Centers for Medicare and Medicaid Services (CMS) published a proposed rule (Proposed Rule) that proposes a comprehensive overhaul of the Medicare Shared Savings Program (MSSP).  Among other changes, CMS proposes to:

  • replace the current three-track program with two options (Basic and Enhanced),
  • establish a ‘glide path’ that propels accountable care organizations (ACOs) towards acceptance of performance-based down-side risk,
  • update the benchmarking methodology to incorporate regional trends from the start of an ACO’s participation in the MSSP,
  • expand the use of telehealth services by ACOs, and

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 …

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