California Legislature Responds to COVID-19 Crisis With Legislation that Would Require State Approval of Healthcare Mergers and Acquisitions

As healthcare providers around the country struggle to respond to patient needs during the Covid-19 crisis, many are reportedly struggling financially as well. In the past, this scenario has led to an increase in merger and acquisition activity, and many healthcare analysts are predicting an increase in such activity for the second half of the year and into 2021.

In light of this development, the California Legislature is considering a bill that would require the California Attorney General’s pre-approval of most healthcare transactions in the state. Specifically, the bill, SB 977 (as amended on May 19), would require that when a healthcare system, private equity group, or hedge fund seeks to acquire or affiliate with a hospital or provider in the state, the parties must obtain the prior approval of the California Attorney General to do so. Continue Reading

Limited Stark and Anti-Kickback Sanction Waivers Issued for Provider Payments During the Pandemic

By William J. Spratt, Jr. and Danielle C. Gordet on May 13, 2020 Posted in Healthcare Law, Healthcare Litigation, Hospitals & Health Systems, Physicians

The COVID-19 pandemic has led to urgent changes to how and where healthcare services are delivered. These changes could require expedited entry into new or modified arrangements for the delivery of essential healthcare goods and services, creating potential conflicts with the Stark Law (Section 1877 of the Social Security Act) and its regulations and potential Office of Inspector General (OIG) sanctions pursuant to the federal Anti-Kickback Statute. As a result, the Secretary of the Department of Health and Human Services (HHS) and the OIG will not impose certain sanctions during the COVID-19 pandemic. These waivers of sanctions are limited in scope and will expire at the end of the emergency declaration. Continue Reading

CMS Issues Additional Waivers and Guidance on Telehealth

By Amy Jeon McCullough and Sidney S. Welch on May 11, 2020 Posted in Healthcare Law, Hospitals & Health Systems, Medicare & Medicaid, Technology

To ensure Medicare beneficiaries have access to necessary care without risking exposure to COVID-19, the Centers for Medicare & Medicaid Services (CMS) has further expanded telehealth services and relaxed certain requirements related to the same with the issuance of additional waivers (available here) and an interim final rule (IFR) available here. Continue Reading

Pharmacy Testing Centers: A Prescription for Fighting COVID-19 in Florida

By Martin R. Dix and Danielle C. Gordet on May 4, 2020 Posted in Government Affairs, Licensure & Regulatory, Healthcare Law, Hospitals & Health Systems, Medicare & Medicaid, Pharmacy, Drugs, Medical Devices & Equipment

Pharmacists can now engage in a new role in the battle against COVID-19 – testing patients for the virus. Recognizing the advanced health care training that pharmacists receive and the unique consumer access to community pharmacies during the Pandemic, the Florida Department of Health has designated pharmacists as medical professionals authorized to order and provide COVID-19 tests. Additionally, pharmacies, as Community-Based Testing Sites (CBTS) will benefit from the waiving of penalties for noncompliance with the HIPAA Privacy, Security, and Breach Notification Rules (HIPAA Rules) during the public health emergency in the situations discussed below.

SCOTUS Rules Government Must Pay $12 Billion to Unprofitable ACA Insurers

By Jeremy Burnette on April 29, 2020 Posted in Affordable Care Act and Other Healthcare Reform Legislation, Health Insurers & Managed Care Organizations, Healthcare Law, Healthcare Litigation

Despite Congress’ efforts to use riders to neutralize a provision of the Affordable Care Act (ACA or Act), the Federal government (Government) owes certain insurers $12 billion. On April 27, 2020, the Supreme Court of the United States (SCOTUS) ruled 8-1 that congressional riders added to appropriations bills that funded the Centers for Medicare & Medicaid Services (CMS) in 2014, 2015, and 2016 did not, in fact, override the Government’s payment obligations pursuant to the ACA’s “Risk Corridors” provision at Section 1342 of the Act (Section 1342).

The Risk Corridors program provided a formula to determine whether health plans participating in the ACA’s healthcare exchanges incurred gains or losses at the end of each of the first three years of Obamacare. Section 1342 states that profitable plans “shall pay” a sum to the Secretary of the Department of Health and Human Services (Secretary), while the Secretary “shall pay” a sum to eligible unprofitable plans. Continue Reading

New FBI Alert to Healthcare Providers – Beware of COVID-19 Phishing Campaigns

By Elizabeth F. Hodge and Christy S. Hawkins on April 27, 2020 Posted in Electronic Health Records & Medical Records, HIPAA, Privacy, and Data Security, Technology

Healthcare providers are under siege, not only from the COVID-19 pandemic, but also from cyber criminals. Following reports of targeted email phishing attempts, the FBI issued a FLASH alert warning healthcare providers on April 21, 2020, that they are at heightened risk for cyber attacks that use COVID-19 as bait. The FBI’s FLASH alert follows its repeated alerts about cyber attacks exploiting COVID-19, including online scams, advance fee and business email compromise scams, cryptocurrency scams, health care fraud schemes, money mule schemes, and exploitation of the increased use of virtual environments. Continue Reading

Buyer Beware – FBI Warns of Fraud Involving Procurement of PPE and Other COVID-19 Supplies

By Elizabeth F. Hodge on April 21, 2020 Posted in Fraud & Abuse & False Claims Act, Government Affairs, Licensure & Regulatory, Healthcare Law, Hospitals & Health Systems

Many employers are now making plans to have their employees return to the workplace. Based on recent alerts from the FBI, part of preparing to protect workers from COVID-19 at work should include protecting the company from falling prey to fraudsters. To do that, employers should put in place procedures to carefully screen vendors from whom they will purchase COVID-19 supplies needed to comply with CDC and OSHA guidance and protect their employees. Continue Reading

Accepting CARES Act Relief Funds for Health Care Providers? Tell Your Compliance Department

By Elizabeth F. Hodge and Danielle C. Gordet on April 20, 2020 Posted in Healthcare Law, Healthcare Litigation, Hospitals & Health Systems, Physicians

While the CARES Act signals relief for many healthcare providers, it is important to remember that there are strings attached and reasons for providers to involve their compliance departments in the use and tracking of the CARES Act relief funds.

The CARES Act promised, through the Public Health and Social Services Emergency Fund, to provide $100 billion in relief funds to hospitals and other healthcare providers (collectively “providers”) for healthcare related expenses and lost revenue attributable to COVID-19. On April 10, 2020, the government started distributing the first $30 billion in funds to eligible providers throughout the healthcare system (the “Relief Funds”). Continue Reading

Dose of Caution Needed When Making Coronavirus Drug Claims

By Sheryl D. Rosen on April 17, 2020 Posted in Government Affairs, Licensure & Regulatory, Pharmacy, Drugs, Medical Devices & Equipment

Just like the dose makes the poison, the claim makes the drug.

With a pandemic well underway, some marketers are offering products that they claim will treat or prevent COVID-19, the disease caused by the novel coronavirus. Without federal approval, however, anyone making claims about unapproved drugs risks is inviting a federal enforcement action. As a result, marketers should exercise great caution when making coronavirus-related claims about their products. Continue Reading

Prescribing in Florida During the Pandemic-What is allowed, What are the gaps, and How do we fill them?

By Martin R. Dix on April 16, 2020 Posted in Hospitals & Health Systems, Pharmacy, Drugs, Medical Devices & Equipment

The catchphrase of the day is “social distancing” and it is the primary means of flattening the COVID-19 pandemic (the “Pandemic”) curve by keeping contagious and healthy people apart. However, there is another kind of distancing that may play a role in fighting the Pandemic – “health care distancing.” Health care distancing is a mechanism to keep the sick patients, who are sick, but not so sick that they need hands on care, out of the health care system so they don’t infect other patients and, at least equally important, the treating health care providers. Continue Reading