On June 30, 2022, Governor Gavin Newsom signed the 2022-2023 California state budget, which included a trailer bill, Senate Bill 184 (the Bill) which makes numerous statutory revisions impacting health programs and consumers. The Bill establishes the Office of Health Care Affordability (OHCA) within the Department of Health Care Access and Information to combat rising health care costs. California will join other states such as Massachusetts, Oregon, and Nevada in implementing a health care cost commission.Continue Reading California Governor Signs Trailer Bill to State Budget Increasing Oversight of Health Care Entities Statewide
On December 23, 2022, New York Governor Kathy Hochul vetoed Assembly Bill Number 8472 entitled “An Act To Amend The Public Health Law, In Relation To The Establishment, Incorporation, Construction, Or Increase In Capacity Of For-Profit Hospice” (the Act). The Act was intended to prohibit the approval, incorporation, or construction of for-profit hospices and would have also prevented any existing for-profit hospices from increasing capacity. The Act would have gone into effect immediately had it not been vetoed.Continue Reading New York Governor Vetoes Act Prohibiting Establishment and Expansion of For-Profit Hospices
On June 2, 2022, the New York State Legislature passed A08472, “An Act to Amend the Public Health Law, in Relation to the Establishment, Incorporation, Construction, or Increase in Capacity of For-Profit Hospice” (“the Act”). The Act prohibits the Public Health and Health Planning Council (PHHPC) of the New York Department of Health (DOH) from approving any new applications for the establishment, incorporation, or construction of a for-profit hospice. Additionally, the bill prohibits PHHPC from approving any increases in capacity to existing for-profit hospices in the state. The two current for-profit hospices will remain approved but cannot expand capacity. The Act will now be presented to the Governor for signature. Once signed by the Governor, the Act will become effective immediately.Continue Reading New York State Legislature Passes Act Enacting Moratorium on For-Profit Hospices
On April 9, 2020 the Centers for Medicare and Medicaid Services (CMS) updated blanket waivers issued previously in response to the COVID-19 public health emergency. According to CMS, the new waivers “focus on reducing supervision and certification requirements so that practitioners can be hired quickly and perform work to the fullest extent of their licenses.” The blanket waivers have a retroactive effective date of March 1, 2020 and do not require a waiver request or notice to CMS to apply.
Continue Reading CMS Updates Blanket Waivers to Help Expand Health Care Workforce
“A mere difference of opinion between physicians, without more, is not enough to show falsity.”
In a 3-0 decision issued September 9, 2019, the U.S. Court of Appeals for the Eleventh Circuit affirmed a three-year-old district court ruling in United States v. AseraCare, Inc. that a Medicare claim for hospice services cannot be deemed false under the False Claims Act (FCA) based on a difference in clinical judgment. This decision – apparently the first circuit-level determination of the “standard for falsity [under the FCA] in the context of the Medicare hospice benefit” – will affect all hospice providers, as the Department of Justice (DOJ) and whistleblowers will not be able to rely on disagreements between physician opinions as the basis for establishing falsity under the FCA. Instead, the Eleventh Circuit instructs that a claim for hospice reimbursement “cannot be “false” – and thus cannot trigger FCA liability – if the underlying clinical judgment does not reflect an objective falsehood.” The Eleventh Circuit’s decision emphasizes that reasonable differences of opinion between physician reviewers of medical documentation are not sufficient to suggest that the judgments concerning a particular patient’s eligibility for Medicare’s hospice benefit, or any claims submitted based on such judgments, are false for purposes of the FCA.
Continue Reading Eleventh Circuit Endorses Objective Falsehood Standard for False Claims Cases Concerning Physician Judgment of Hospice Eligibility
On July 9, 2019, Connecticut Governor Ned Lamont signed into law Public Act No. 19-118 “An Act Concerning the Department of Public Health’s Recommendations for Various Revisions to the Public Health Statutes” (PA 19-118). Certain relevant provisions of PA 19-118 are described below.
Continue Reading Connecticut Legislature Modifies Public Health Statutes
A recent complaint filed by the United States Department of Justice against a private equity firms regarding an alleged kickback further illustrates new concerns private equity should be aware of in the healthcare arena and working with counsel to mitigate such concerns. A February 23, 2018 press release from the DOJ regarding United States ex rel. Medrano and Lopez v. Diabetic Care Rx, LLC dba Patient Care America, et al., No. 15-CV-62617 (S.D. Fla.), available here, describes how the complaint was made against a pharmacy, several of its executives and the private equity firm, which manages the pharmacy and the private equity fund that owns the pharmacy. The United States Attorney’s Office for the Southern District of Florida stated in the release that “We will hold pharmacies, and those companies that manage them, responsible for using kickbacks to line their pockets at the expense of taxpayers and federal health care beneficiaries.”
Continue Reading Private Equity Firm Named as Defendant in False Claims Act Case Targeting A Portfolio Company
On April 2, 2018, the Centers for Medicare & Medicaid Services (CMS) issued a Final Rule, updating Medicare Advantage (MA) and the prescription drug benefit program (Part D). The Final Rule includes, among other provisions:
- Preclusion List Requirements for Prescribers in Part D and Individuals and Entities in Medicare Advantage, Cost Plans, and PACE: The Final Rule eliminates the MA and Part D prescriber and provider enrollment requirement. Instead, CMS is compiling a “Preclusion List” of prescribers, individuals, and entities that: (1) are currently revoked from Medicare, under an active reenrollment bar, or have engaged in behavior for which CMS could have revoked enrollment in Medicare and (2) in addition, CMS determines their underlying conduct to be detrimental to the best interests of the Medicare program. The Preclusion List will be made available to MA plans and Part D prescription drug plans, which must deny payment for claims submitted by, or associated with prescriptions written by prescribers and providers on the list.
- Eliminating “Meaningful Difference” Requirements: Beginning with CY 2019 bid submissions, CMS has eliminated the requirement that MA plans offered by the same organization in the same county comply with the “meaningful difference” requirements, which limit the variety of plans an MA organization can offer in the same county. The Final Rule eliminates the “meaningful difference” requirement for PDP Enhanced Alternative (EA) benefit designs offered by the same organization in the same region, but does not change this requirement between PDP Basic and EA prescription drug plan offerings.
- Medicare Advantage Uniformity Requirements Flexibility: As an option for all MA plans, the Final Rule allows the plans to reduce cost sharing for certain covered benefits, offer specific tailored supplemental benefits, and offer different deductibles for beneficiaries that meet specific medical criteria.
The OIG has released the 2017 Compendium of Unimplemented Recommendations, summarizing prioritized recommendations relating to HHS programs and operations. Topping the list are recommendations relating to hospitals, including:
- Reimbursement rates for critical access hospital swing beds should be adjusted to the lower rates for similar services provided in skilled nursing facilities.
- Reimbursement rates for hospital outpatient department procedures should be adjusted to the lower rates for similar procedures conducted in ambulatory surgical centers.
- Medicare should adopt a hospital transfer payment policy to lower hospital reimbursement for beneficiaries who are discharged early to hospice care.
- CMS and the Agency for Healthcare Research and Quality should take steps to reduce harm to patients in rehabilitation hospitals.
- CMS should increase protections for beneficiaries under the 2-midnight policy that applies to hospitals decisions about a beneficiary’s inpatient or outpatient admission status.
- The disparity in beneficiary coinsurance for outpatient services received at a critical access hospital versus an acute-care hospital should be reduced.