Second Circuit Sends PBM “Clawback” Litigation Plaintiffs Back to the Drawing Board

Posted in Healthcare Law, Healthcare Litigation, Hospitals & Health Systems, Physicians

Anthem, Inc., (Anthem) and Express Scripts, Inc., (Express Scripts) had a big win this week, creating another setback for plaintiffs filing ERISA lawsuits against pharmacy benefits managers (PBMs). On December 7, 2020, the Second Circuit Court of Appeals upheld U.S. District Judge Edgardo Ramos’s decision that Anthem and Express Scripts did not violate fiduciary obligations under the Employer Retirement Income Security Act (ERISA) because neither party acted as an ERISA fiduciary with regard to decisions that allegedly led to higher prescription drug prices for patients and plans. (See Doe v. Express Scripts, Inc., 2020 WL 7133860, (C.A.2 (N.Y.), 2020)).

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Healthcare Providers: Please Be Wary of Accepting Those Gifts!

Posted in Healthcare Law, Healthcare Litigation, Hospitals & Health Systems, Physicians

There has been a longstanding and regrettable practice in the healthcare industry of pharmaceutical and medical device companies giving physicians gifts as illegal inducements. Concerned about this continued trend, the U.S. Department of Justice (DOJ) and the Department of Health and Human Services’ Office of Inspector General (OIG) issued important warnings regarding providing inducements to healthcare providers (HCPs) – just in time for the holiday season! On October 29, 2020, the DOJ announced its first-ever enforcement action for a violation of the Open Payments Program reporting requirements. On November 16, 2020, the OIG issued a Special Fraud Alert regarding the potential Anti-Kickback Statute implications inherent in speaker programs. Pharmaceutical manufacturers, medical device companies, and HCPs should read the guidance carefully and be extremely cautious before accepting or offering any remuneration this holiday season and beyond. Continue Reading

Federal Trade Commission Challenge to Northern Philadelphia Hospital Merger Fails

Posted in Antitrust, Government Affairs, Licensure & Regulatory, Healthcare Law, Healthcare M&A, Joint Ventures, Transactions & Health Ventures, Hospitals & Health Systems

The Federal Trade Commission (“FTC”) has failed – at least for now – in its efforts to derail a merger between Thomas Jefferson University Health System and Albert Einstein Health System, two Philadelphia-area health systems. In a decision announced on December 8, Judge Pappert, District Judge for the Eastern District of Pennsylvania, ruled that the FTC, which was joined in the action by the Pennsylvania Office of the Attorney General (“PA AG”), had failed to demonstrate that the merger should be enjoined. In reaching this decision, the Court held that the FTC had failed to show that there would be an insufficient number of alternative providers of hospital services in the region to limit the ability of the merged entity to increase prices post-merger. Accordingly, absent an appeal by the FTC and/or the PA AG to the Third Circuit, and a successful request for a stay of the lower Court’s ruling, the merging parties will likely complete their merger in the coming weeks. Continue Reading

A Glossary of Commonly Used Acronyms in Florida Managed Care

Posted in Accountable Care Organizations, Health Care Providers, Health Insurers & Managed Care Organizations, Healthcare Law

Anyone who interacts with third party payors encounter acronyms on a regular basis. While acronyms are intended to facilitate efficient communication, their use often instead leads to confusion. This blog is intended to provide a brief overview of some commonly used acronyms in managed care. Please note that, although some of the acronyms are specifically applicable to Florida, most are used throughout the country. Also note that the following are general descriptions intended to provide a high-level understanding of the acronyms. Please refer to your specific jurisdiction for more detailed definitions. For ease of reference, we have included links to the 2020 Florida statutory definitions where applicable.

Types of Entities & Types of Coverage

ACO – Accountable Care Organization

An organization of physicians, which may also include hospitals and other healthcare providers, that provides coordinated care to Medicare recipients and is paid by the Centers for Medicare and Medicaid Services based upon their patients’ quality metrics and reductions to the cost of their patients’ care.

DMPO – Discount Plan Organization (formerly known as Discount Medical Plan Organization)

A company that provides access to medical providers at a discount from the providers’ usual rates.

See Section 636.202(2), F.S.

EPO – Exclusive Provider Organization

A product offered by a health insurance company that, like an HMO, controls cost in part by generally restricting access only to healthcare providers who have contracts with the health insurance company (contracted providers are also referred to as in-network providers).

See Section 627.6472, F.S. for definitions of exclusive provider and exclusive provider provision.

FISO – Fiscal Intermediary Services Organization

A company that contracts with an HMO’s in-network providers and that collects payments on behalf of the providers from the HMOs.

See Section 641.316(2)(b), F.S.

HMO – Health Maintenance Organization

An MCO that provides comprehensive health coverage and that controls cost in part by generally restricting access only to healthcare providers who have contracts with the HMO.

See Sections 110.123(2)(d), 641.19(11), and 766.105(1)(e), F.S.

MCO – Managed Care Organization

A company (usually a health insurer or HMO) that provides health coverage with mechanisms to control costs and reduce excessive or inappropriate care.

See Sections 409.901(13), 409.920(1)(e), and 409.962(10). F.S. for definitions of managed care plan(s).

PBM – Pharmacy Benefits Manager

A company that negotiates with drug manufacturers on behalf of MCOs or similar entities to help control prescription drug costs and provide prescription drug benefits.

See Sections 624.490(1), 627.64741(1)(b), 627.6572(1)(b), and 641.314(1)(b), F.S.

PHC – Prepaid Health Clinics

An MCO that provides comprehensive health coverage, except that it does not cover inpatient hospital expenses, and that controls cost in part by generally restricting access only to healthcare providers who have contracts with the PHC.

See Section 641.402(4), F.S.

PHO – Physician (or Provider) Hospital Organization

A company that contracts with physicians and hospitals to form a single organization for the purpose of contracting with MCOs and similar entities.

PLHSO – Prepaid Limited Health Services Organization

An MCO that is limited to providing only certain types of coverages (i.e., dental, vision, etc.) and that controls cost in part by generally restricting access only to healthcare providers who have contracts with the PLHSO.

See Section 636.003(7), F.S.

POS – Point of Service (type of HMO product)

An MCO product offered by an HMO that allows a member the ability to access out-of-network providers, but at a greater cost than in-network providers (this is similar to an insurance company PPO product).

See Section 641.31(38), F.S. for point of service requirements.

PPO – Preferred Provider Organization

A product offered by a health insurance company that provides financial incentives to use healthcare providers that are contracted with the insurance company but also allows access to non-contracted providers (also referred to as out-of-network providers) at a greater cost.

See Section 627.6471, F.S. for definitions of preferred provider network and preferred provider.

PSN – Provider Service Network

In Florida, an MCO that is majority-owned and -controlled by Medicaid providers and that contracts with the Florida Agency for Healthcare Administration to provide comprehensive health coverage to Medicaid recipients.

See Sections 409.912(1)(b), 409.962(14), and 641.19(22), F.S.

TPA – Third Party Administrator (also known as Insurance Administrator)

A company that contracts with health insurers or similar entities such as HMOs, usually to provide claims processing services, but in Florida, a TPA may also solicit coverage and collect premiums.

See Section 626.88(1), F.S.

In addition, following are some commonly used state and federal acronyms and their meanings:

Federal Regulators & State Insurance Commission Associations

CMS – Centers for Medicare and Medicaid Services

HHS – U.S. Department of Health and Human Services

NAIC – National Association of Insurance Commissioners

Laws

ACA/PPACA – Patient Protection and Affordable Care Act (ObamaCare)

ERISA – Employee Retirement Income Security Act

HIPAA – Health Insurance Portability and Accountability Act

Florida Regulators

AHCA – Florida Agency for Healthcare Administration

DFS – Florida Department of Financial Services

OIR – Florida Office of Insurance Regulation

 

COVID-19 and Possible Silver Bullets: Update on Vaccine Development

Posted in Healthcare Law, Hospitals & Health Systems, Laboratories, Pharmacy, Drugs, Medical Devices & Equipment

As the world continues to grapple with the COVID-19 pandemic that has taken the lives of over 250,000 Americans, and worldwide over 1 million people, this year, an effective vaccine has emerged as our silver bullet – a way for the nation, and the world, to fight back and, in time, begin to return to some semblance of normalcy. There is some encouraging news on that front, as there are two promising separate clinical trials that have produced potentially viable vaccine candidates in the pipeline for potential emergency approval by the US Food and Drug Administration (FDA), with others possibly coming soon as well.

Clinical Trials – The Latest

Pfizer, and its partner, BioNTech, a German biotech company, announced that the data from phase three of its clinical trial shows their developed vaccine to have an effective rate of approximately 95%. For a vaccine to earn FDA approval, generally, a minimum threshold of 50% effectiveness is generally sought. By way of comparison, an annual flu vaccine is 40-60% effective, and a dual dose of a Measles vaccine is 97% effective. The numbers reported by Pfizer, therefore, are encouraging. Pfizer plans to submit an application to the FDA for emergency use authorization (EUA) on November 20, 2020.

Separately, Moderna, an American biotechnology company based in Cambridge, MA, announced this week that early data from its phase three trial shows an efficacy rate of 94.5%, also encouraging and significantly above the FDA baseline for consideration for approval.

Both vaccines were developed using a new technology called messenger RNA, or mRNA. Because it is a new method of vaccine development, there may be questions raised by both the FDA and the CDC regarding safety.

What’s Next – The EUA Approval Process

Normally a vaccine’s development and approval takes years. To have a potentially viable vaccine available in less than a year’s time is unprecedented. In this case, the Vaccines and Related Biological Products Advisory Committee, a group of independent advisors to the FDA comprised of independent experts and a consumer representative, will be the first to review an EUA application. This committee may have additional follow-up questions, including possible concerns about the mRNA process. If the committee ultimately votes to approve the vaccine, then the FDA considers whether to accept the committee’s guidance.

Then, the Advisory Committee on Immunization Practices, an advisory committee for the CDC, will make recommendations as to which groups would be initially eligible to receive the vaccine, with the CDC’s priority likely going first to front line health professionals, then to the elderly and immunosuppressed, and then to the general public.

Challenges Ahead

Keep in mind that the process that is outlined above is if all reviews go smoothly. Once the vaccine is approved, the manufacturers have to make the doses in large quantities, so the best-case scenario is that a vaccine is available to the general public in the spring of 2021, at the earliest. Another concern is that at least one of the promising vaccines must be stored at a temperature of nearly -100 degrees Fahrenheit, presenting a significant logistical challenge for providers. While the vaccine trial results present promising news for all of us, the challenges ahead, both in regulatory approval and in the logistical hurdles of delivering the vaccine to patients’ arms worldwide, present the next set of challenges to overcome. We will keep you apprised of developments as they roll out.

Florida: Do You Know Where Your “Minor” Is?

Posted in Healthcare Law, Healthcare Litigation, Hospitals & Health Systems, Physicians

During the COVID-19 pandemic, telehealth usage has dramatically increased, as discussed in a recent Health Law Rx post. Telehealth makes it easier for individuals who cannot drive, including many minors, to seek necessary care, leading to many questions regarding when “minors” (individuals under 18 years of age) can consent to treatment – when the “disability of nonage” has been removed. Read more here and here. The following overview of the relevant Florida laws is meant to help healthcare providers determine when minors can and cannot consent to their own treatment.

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“Historic” Settlement of Blue Cross Blue Shield Association Antitrust Action May Significantly Boost Competition in Health Insurance Markets in 2021

Posted in Antitrust, Health Insurers & Managed Care Organizations, Healthcare Law, Healthcare Litigation

After over 8 years of hard-fought litigation, the Blue Cross and Blue Shield Association, together with its 36 Blue Cross/Blue Shield members (“the Blues”), recently announced a proposed settlement of class action antitrust litigation (In re Blue Cross Blue Shield Antitrust Litigation) brought against them by a nationwide class of subscriber members. The settlement terms, summarized in the plaintiffs’ motion seeking the Court’s approval of the settlement, includes both the payment of substantial monies to the plaintiff class ($2.67 billion) and significant agreed-to changes to the way in which the Blues operate. Continue Reading

Is A Safer Healthcare System Within Reach?

Posted in Healthcare Law, Healthcare Litigation, Hospitals & Health Systems, Physicians

COVID-19 has made healthcare organizations acutely aware of the need to fine-tune their internal safety systems. The National Steering Committee for Patient Safety (NSC), comprised of 27 organizations, has come to the rescue. NSC recently released guidance entitled, “Safer Together: A National Action Plan to Advance Patient Safety” (the Plan). The Plan provides a methodology for improving safety and reducing harm by outlining 17 recommendations within 4 foundational areas throughout healthcare.

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HIPAA Says To Give Me My Medical Records…NOW!

Posted in Healthcare Law, Healthcare Litigation, Hospitals & Health Systems, Physicians

Healthcare providers are generally required by HIPAA to provide patients or their legal representatives with the ability to inspect or obtain copies of their medical records within 30 days of a request (state specific requirements are not addressed herein.) The Office of Civil Rights (OCR) has been enforcing this requirement through its Right of Access Initiative, which it announced in 2019, “promising to vigorously enforce the rights of patients to receive copies of their medical records promptly and without being overcharged.” Continue Reading

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