Category Archives: Hospitals & Health Systems

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Accountable Care, Non-Profit Status and the Dangerous Ripple Effect it May Cause

On April 8, 2016, the Internal Revenue Service (IRS) released Private Letter Ruling (PLR) 201615022, which denied tax-exempt 501(c)(3) status to a commercial accountable care organization (ACO). This ruling marks the first time the IRS published any guidance regarding commercial ACOs. The last guidance from the IRS regarding ACOs came in 2011 and was related to ACO participation in … Continue Reading

Lights, Camera, Settlement: OCR says a picture is worth $2.2 million

A New York hospital has settled with the U.S. Department of Health and Human Services Office for Civil Rights (“OCR”) for $2.2 million after allowing a TV crew for the ABC documentary series “NY Med” to film patients receiving medical treatment without obtaining prior authorization from the patients or their representatives. The estate of one those patients is also suing … Continue Reading

Not a Check-the-Box Exercise: Failure to Have Signed BAA Results in Substantial Fine

A group practice that was the victim of a silver-harvesting scam has agreed to pay the U.S. Department of Health and Human Services (“HHS”) $750,000 to settle charges that it released protected health information (“PHI”) of its patients to a third party vendor without first obtaining a written business associate agreement. Raleigh Orthopaedic Clinic, P.A. (the “Clinic”) provided x-ray films … Continue Reading

Florida’s Adoption of Federal Exemptions for Wholesale Drug Distribution May Benefit Pharmacies, Practitioners and Hospitals

The 2016 Florida Legislature enacted substantial legislation (Ch. 2016-212, Laws of Florida) to bring Florida’s Drug and Cosmetic Act (Ch. 499, Florida Statutes) in line with the federal Drug Supply Chain and Security Act (“DSCSA”). Since the DSCSA preempts state law, the changes were necessary to avoid confusion between the state and federal exemptions to the term “wholesale … Continue Reading

Prepare for the Unexpected with Data Storage and Retrieval

Last week, a federal court in Illinois encountered another example of unexpected events causing problematic privacy and data storage implications for a healthcare company. The non-profit organization responsible for maintaining the MetroChicago Health Information Exchange (the HIE) filed suit against its information technology support contractor and the contractor’s owner to prevent the contractor’s plan to destroy all client data after … Continue Reading

Shhh….OCR Releases New HIPAA Audit Protocol

Just in time for the Phase 2 audits, the Department of Health and Human Services Office for Civil Rights (OCR) quietly posted the updated HIPAA Audit Protocol on its website. The new audit protocol has been updated to include business associates who became subject to HIPAA following the 2013 HIPAA Omnibus Final Rule. The protocol covers Privacy Rule, Security Rule … Continue Reading

Federal Court finds “Systemic Failure” in Processing of Administrative Appeals for Medicare Reimbursement Claims

A win for efficiency: The AHA suit may force shorter adjudication times for Medicare administrative appeals. In 2014, the American Hospital Association (AHA), along with three hospital systems, filed suit against the U.S. Department of Health and Human services, alleging that the lengthy adjudication time for administrative appeals of Medicare claim denials caused severe economic harm.  See, American Hospital Continue Reading

CMS Updates Two-Midnight Rule

The Centers for Medicare and Medicaid Services (CMS) has revised the two-midnight rule to create an exception that will allow payment under Medicare Part A for certain medically necessary hospital stays that do not extend across two midnights. The new rule is effective for admissions after January 1, 2016, and permits payment on a case-by-case basis, supported by the admitting … Continue Reading

Protecting the Blood Supply During a Future Ebola Outbreak

It has been more than a year and a half since the Ebola outbreak began racing across western Africa. According to the U.S. Centers for Disease Control & Prevention (CDC), more than 28,000 people have been infected. Although the United States had very few Ebola patients, the Food and Drug Administration (FDA) recently released guidance for the collection of blood … Continue Reading

Identifying Overpayments Under the ACA’s 60-Day Rule Creates Additional Uncertainty in Determining False Claims Act Liability

Under the Affordable Care Act (ACA), healthcare providers that receive an overpayment from Medicare or Medicaid are required to report and return the overpayment to the government within 60 days after the date on which the overpayment was identified (commonly referred to as the “60-day rule”). An overpayment retained after 60 days constitutes an “obligation” for purposes of potential False … Continue Reading

OIG Issues Favorable Opinion Giving Green Light To Health System’s Shuttle Service

The Office of Inspector General (OIG) recently issued another advisory opinion on free patient transportation (OIG Adv. Op. No. 15-13, dated October 21, 2015). In the opinion, the OIG addresses whether providing patients a free shuttle service between medical facilities operated by an integrated health system (the System) would be prohibited remuneration to beneficiaries under the Anti-Kickback Statute. … Continue Reading

Illinois Enacts Patient Notification Requirement for Observation Stays

Illinois joins a growing number of states to pass laws requiring that hospitals provide notice to patients who are placed under observation status. 210 ILCS 86/6.09b As with the recent federal NOTICE Act, the laws respond to patients not understanding the difference between observation in a hospital bed and inpatient admission. The Illinois law requires a hospital to notify … Continue Reading

Hospitals Required to Notify Medicare Beneficiaries of Observation Status

The NOTICE Act (Notice of Observation Treatment and Implication for Care Eligibility) has been signed into law as of August 6, 2015. The Act requires hospitals to provide oral and written notice to patients within 36 hours of being placed in observation care (or, upon discharge, if sooner). The notice must explain to patients, in plain language, that they have … Continue Reading

CMS Publishes Notice of Proposed Rule Making Regarding Stark Law Amendments and Seeks Comment on the Issue of Stark Acting as a Barrier to Healthcare Reform

In early July, the Centers for Medicare and Medicaid Services (CMS) published a notice of proposed rulemaking, amending the Physician Self-Referral Prohibitions, or Stark law. 80 Fed. Reg. 41,909-930 (July 15, 2015). The proposed rule introduces two exceptions to Stark. The first new exception, 42 C.F.R. §411.357(x), allows financial assistance to medical practices so they may be able to recruit … Continue Reading

IRS Says Hospitals Must List Physicians in Financial Assistance Policies

On June 26, 2015, the Internal Revenue Service (IRS) issued guidance to clarify how charitable hospitals may comply with regulations issued by the Department of Treasury under the Patient Protection and Affordable Care Act (ACA). The regulations implementing Section 501(r) of the Internal Revenue Code require hospitals to include a list of covered providers in their financial assistance policies. This … Continue Reading

Illinois Appellate Court Holds No Standing to Sue for Medical Information Data Breach Where Injury is Speculative

On June 2, 2015, the Second District Illinois Appellate Court affirmed the decisions of two lower courts, which had dismissed breach of privacy cases for lack of standing. The cases were consolidated for the purposes of the appeal. Both cases were brought against Advocate Health and Hospitals Corporation d/b/a Advocate Medical Group (Advocate), an Illinois network of affiliated physicians and … Continue Reading

The Top 10 Patient Safety Concerns for Healthcare Organizations in 2015

The Emergency Care Research Institute, (ECRI) Patient Safety Organization (PSO) has issued its 2015 “top 10 list” of safety concerns for multiple healthcare settings, such as hospitals, ambulatory care centers, doctor’s offices and nursing homes.[i] This year’s list is as follows:… Continue Reading

Charitable Hospitals: Financial Assistance Policies

The Internal Revenue Service (IRS) has issued the final section 501(r) regulations, implementing the amendments to the Internal Revenue Code under the Affordable Care Act and providing regulatory guidance for tax-exempt hospitals. This post describes the guidance for financial assistance policies, limitation on charges, and billing and collection practices and highlights the changes made between the proposed and final rules. … Continue Reading

Divestiture of St. Luke’s Acquisition Upheld Despite Transaction’s “Laudable” Goals

On February 10, 2015, the Federal Trade Commission (FTC) achieved a historic victory when a U.S. Court of Appeals ruled that a hospital’s acquisition of a physician’s group – the transaction challenged by the FTC – ran afoul of federal antitrust laws, despite the likelihood that the acquisition would result in greater efficiencies and quality of care. This decision marks … Continue Reading

CMS Announces Enforcement of EHR Payment Adjustments in 2015

On December 17, 2014, the Centers for Medicare and Medicaid Services (“CMS”) announced that there would be reductions in Medicare reimbursement for health care providers who do not meet the CMS electronic health record (“EHR”) incentive program’s meaningful use requirements. This announcement comes in the wake of CMS’ decision in October to extend the hardship exception deadline – an exception … Continue Reading

Reimbursement Changes, Shift to Consumerism Discussed at Akerman Healthcare Briefing

Changing reimbursement models and a shift to consumerism were two of the hot topics discussed at Akerman LLP’s recent Healthcare Briefing event titled “Financial and Corporate Implications of the Affordable Care Act: A Look at the Past, Present, and Future”. Health care and financial industry leaders gathered Friday, November 21 in Tampa for the interactive discussion. Panelists leading the discussion … Continue Reading

Illinois Court Dismisses Plaintiffs Privacy Claims Arising out of HIPAA Breach

On July 10, 2014, a Kane County, Illinois Circuit Court granted a motion to dismiss with prejudice in favor of Advocate Health & Hospitals Corporation (Advocate) in a class action case arising out of a breach of patients’ protected health information (PHI). In August 2013, Advocate reported one of the largest data breaches to date under the Health Insurance Portability … Continue Reading

Physicians and Photography Don’t Mix

A gynecologist who secretly photographed and videotaped women’s bodies in the examining room will cost one of the world’s leading medical institutions $190 million.  In a damaging blow to its reputation, Johns Hopkins Hospital has agreed to a settlement with more than 8,000 patients of Dr. Nikita Levy, who wore a pen-like camera around his neck to secretly record videos … Continue Reading

Enhancements to Florida’s Solicitation of Funds Law Now Effective – Charities Now Have Tighter Regulations

In response to the Tampa Bay Times investigative story, “America’s Worst Charities,” Florida’s Commissioner of Agriculture, Adam Putnam, worked with the Florida Legislature to enact material enhancements to Florida’s Solicitation of Funds statutes (Chapter 496 – HB 629). Any charity that is subject to registration with the Department of Agriculture and Consumer Services (the Department), including not-for-profit hospitals and other … Continue Reading

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