Below is an excerpt of an article, co-authored with Antitrust and Trade Regulation Team lawyer Jen Driscoll and Internal Investigations and Corporate Compliance chair Ed Heath, published in the American Health Law Association’s Health Law Weekly newsletter on January 19, 2024.

Mergers and acquisitions in health care markets are viewed with heightened scrutiny by

On September 27, 2023, the Health Resources and Services Administration (HRSA) issued a Notice in the Federal Register applicable to all 340B Program hospitals that formally ends a COVID-era waiver of the long-standing HRSA requirement that off-site, outpatient facilities be (1) listed as reimbursable on the hospital’s Medicare Cost Report (MCR) prior to participating in the 340B Program; and (2) registered and listed in the Office of Pharmacy Affairs Information System (OPAIS) prior to participating in the 340B Program.Continue Reading HRSA Confirms End of COVID Waiver of Advance Registration Requirement for Provider-Based Clinics

On October 9, 2019, the Department of Health and Human Services (HHS) released its long-awaited proposals (the Proposed Rules) to update regulatory exceptions and safe harbors, for the federal Physician Self-Referral Law (also known as the Stark Law), the Anti-Kickback Statute (AKS), and the beneficiary inducement Civil Monetary Penalties Law (CMP). The Centers for Medicare & Medicaid Services (CMS) issued a proposed rule to update exceptions to the Physician Self-Referral Law (the PSR Rule), and the HHS Office of Inspector General (OIG) issued a proposed rule to update the AKS safe harbors and expand exceptions to the CMP’s beneficiary inducements prohibition (the AKS Rule). The Proposed Rules are intended to reduce perceived regulatory barriers to beneficial health care arrangements, and to facilitate the implementation of new approaches to health care service delivery and coordination, including value-based care models.
Continue Reading Government Releases Proposed Rules on Physician Self-Referral Law (Stark Law), Anti-Kickback Statute and CMP Law; Significant Regulatory Changes Intended to Encourage Care Coordination and Value-Based Care

On June 22, 2017 the Federal Trade Commission (FTC) filed an administrative complaint and a request for a preliminary injunction in federal court to block a proposed physician practice acquisition in North Dakota (the Transaction), the agency’s latest intervention in opposition to consolidation at the physician practice level. In this case, the FTC (accompanied by the Attorney General of North Dakota) opposes a proposed acquisition of Mid Dakota Clinic, P.C. (MDC) by Sanford Bismarck (a subsidiary of multi-state health system Sanford Health, collectively Sanford) on the grounds that the Transaction, if consummated, would represent an unfair method of competition in violation of Section 5 of the FTC Act (15 U.S.C. § 45) and may substantially lessen competition in violation of Section 7 of the Clayton Act (15 U.S.C. § 18).
Continue Reading FTC Intervenes in Physician Practice Acquisition in North Dakota

In a little-noticed development, on February 3, 2017, the Department of Justice (DOJ) increased the per-claim range of penalties under the federal False Claims Act (FCA) (31 U.S.C. § 3729 et seq.) for the second successive year, in accordance with a statutory requirement issued under the Bipartisan Budget Act of 2015. As a result, FCA defendants are now subject to monetary penalties ranging from $10,957 to $21,916 per claim submitted in violation of the FCA.

Section 701 of the Bipartisan Budget Act of 2015 revised federal requirements for determination of civil monetary penalties by federal agencies, including substituting a new statutory formula for calculating inflation adjustments annually. In response, on June 30, 2016, the DOJ issued an interim final rule with a request for comments to adjust civil monetary penalties assessed by DOJ for inflation. That interim final rule led to a significant increase in the range of per claim FCA penalties because the new formula tied the inflation adjustments to cost of living increases between 2015 and the year in which each civil penalty was established or adjusted by law.  Consequently, the DOJ used the FCA’s per claim penalty range of $5,000 to $10,000 established in 1986 as a baseline, which yielded a considerable increase to a new penalty range of $10,781 to $21,563 per claim in violation of the FCA as of August 1, 2016.On February 3, 2017, the DOJ finalized its interim final rule (and the formula for inflation adjustments), and also published its new range of per claim penalties for violations assessed on or after February 3, 2017 (that occurred on or after November 2, 2015).


Continue Reading DOJ Increases Range of Per-Claim Penalties under False Claims Act for 2017