Health Law & Policy Matters

Health Care Attorneys | Mintz Levin Law Firm

D.C. Circuit Upholds Contraceptive Coverage Mandate

Posted in Health Care Reform, Payors & PBMs, Reimbursement

Written by: Bridgette A. Wiley

Last week, a unanimous three-judge panel of the D.C. Circuit upheld the religious accommodation to the Affordable Care Act’s (“ACA”) contraceptive coverage mandate (Priests for Life v. HHS, D.C. Cir. No. 13-5368, Nov. 14, 2014).  The court held that the accommodation set out by the Department of Labor (“DOL”) and Department of Health and Human Services (“HHS”) is a simple solution that does not impose a burden for purposes of the Religious Freedom Restoration Act of 1993 (“RFRA”).

Specifically, the court held that the religious accommodation does not impose a substantial burden on the religious rights of Priests for Life because all it requires them to do “to opt out is express what they believe and seek what they want via a letter or two-page form.”  They continued to say that even if the self-certification imposed a burden, it is the least restrictive means to achieve the government’s compelling interest in ensuring access to contraceptive coverage.

This is the third circuit court to reject such a challenge to the religious accommodations.  The D.C. Circuit also noted that, “Many religiously affiliated educational institutions, hospitals, and social-service organizations have taken advantage of the accommodation, and courts of appeals have uniformly sustained it against challenges under RFRA and the Constitution. See Mich. Catholic Conf. & Catholic Family Servs. v. Burwell, 755 F.3d 372 (6th Cir. 2014); Univ. of Notre Dame v. Sebelius, 743 F.3d 547 (7th Cir. 2014) petition for cert. filed (Oct. 3, 2014) (No. 13-3853).”  A petition has been filed to the Supreme Court for consideration of the Notre Dame case and it is expected that this D.C. Circuit decision will also be appealed to the Supreme Court.

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Strategies for Efficiently Obtaining Antitrust Clearance

Posted in Antitrust, Hospitals & Health Systems, Pharma & Medical Devices, Physicians

The health care industry remains an enforcement priority for the Federal Trade Commission (“FTC”).  In a recent interview, the Director of the FTC’s Bureau of Competition, Debbie Feinstein, stated that the Bureau’s top three priorities for health care antitrust enforcement are: (1) challenging reverse patent settlement cases (or pay-for delay cases); (2) challenging anticompetitive pharmaceutical company mergers; and (3) reviewing healthcare provider combinations.  As health industry participants engage in mergers, joint ventures, and other competitive collaborations where an antitrust review is anticipated, it is important for deal counsel to employ effective strategies to more efficiently manage the review and investigation process.  In part two of this three part series, we provide guidance regarding Strategies for Efficiently Obtaining Antitrust Clearance.


Vascular Solutions Inc. and its CEO Face Criminal Charges for Selling Unapproved Medical Devices

Posted in Fraud & Abuse, Pharma & Medical Devices, State & Federal Audits, Investigations & Litigation

Written by: Laurence J. Freedman and Samantha P. Kingsbury

Last week, the Civil Division of the U.S. Department of Justice (DOJ) filed an indictment charging Vascular Solutions Inc. (VSI) and its CEO Howard Root with (1) selling medical devices without the approval of the U.S. Food and Drug Administration (FDA); and (2) conspiring to defraud the U.S. government by concealing their illegal activities.  This case is pending in the U.S. District Court for the Western District of Texas.  In July 2014, VSI entered into a civil settlement agreement with DOJ under which it agreed to pay $520,000 to resolve allegations under the False Claims Act regarding this conduct.

Under its consumer protection criminal authorities, the Civil Division charged Mr. Root and VSI each with one count of conspiracy and eight counts of introducing adulterated and misbranded medical devices into interstate commerce in connection with a sales campaign related to VSI’s Vari-Lase product line.  The Vari-Lase system was designed to treat varicose veins by sealing them with a laser (“ablation”).  The indictment alleges that the Vari-Lase system was only approved by the FDA for the treatment of superficial veins, not perforator veins (which connect the superficial vein system to the deep vein system). 

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The 340B Mega-Reg is Dead

Posted in Health Care Reform, Hospitals & Health Systems, Payors & PBMs, Pharma & Medical Devices, Pharmacies

Written by: Ellyn Sternfield

With all due credit to the Coroner from the Wizard of Oz, like the Wicked Witch of the East crushed by Dorothy’s house, the 340B Drug Discount Program mega-reg is “not only merely dead, it’s really most sincerely dead.”  And to quote one of my favorite sports commentators, Tony Kornheiser, “I believe I had that.”

Let’s recap.  In January 2014, HRSA announced that it would be “formalizing” existing guidance and issuing a regulation designed to cover “a number of aspects” of 340B program operations.  Termed the “mega-reg,” it was intended to address such controversial issues as the definition of a “patient” eligible to receive a 340B drug, compliance requirements for 340B contract pharmacies, and mandatory criteria for hospital eligibility as a 340B covered entity.  HRSA stated that the proposed mega-reg would be published and available for comment no later than June 2014.  And indeed the draft rule was forwarded to OMB for review in April 2014.  So what happened?  Well, let’s just say that HRSA’s Orphan Drug Rule was the tornado which carried the house to Oz, causing it to land on the witch.

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The Seventh Circuit Rejects Medicaid False Claims Act Suit

Posted in Fraud & Abuse, Pharmacies

Written by:  Brian P. Dunphy

The United States Court of Appeals for the Seventh Circuit affirmed the dismissal of a False Claims Act (“FCA”) case against Shopko Operating Stores, LLC, in which a former Shopko pharmacist asserted Medicaid billing violations.  The Seventh Circuit agreed “with the district court that [relator's] legal theory is not viable no matter how detailed his factual allegations.”  Importantly, the appeals court also found that Shopko was “permitted to bill in the fashion that it did.”  My colleagues from Mintz Levin’s health law and litigation practice areas, Tom Crane, Ellen Janos, and Bret Leone-Quick, along with other members of the firm’s health law and litigation groups, represented Shopko before both the district court and the Seventh Circuit.

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ML Strategies Posts Special Election Edition of its Weekly Health Care Update

Posted in Health Care Reform

This week ML Strategies has prepared a Special Edition of its weekly Health Care Update.  In addition to the weekly collection of important health policy news and events, this week’s Health Care Update summarizes significant leadership changes in Congress and legislative activity following the Midterms and going into the Lame Duck session.

This week’s Health Care Update also includes an in-depth overview of the ongoing response to Ebola which continues to be the leading priority for health policymakers.

Click here to read this week’s full Health Care Update.

Hospital Alliance Deemed a Single Entity, Incapable of Conspiring

Posted in Antitrust, Hospitals & Health Systems, State & Federal Audits, Investigations & Litigation

On October 21, 2014, the U.S. District Court for the Southern District of Ohio granted Defendants’ motion for summary judgment, holding that Premier Health Partners and its affiliate hospitals, Atrium Health Systems, Catholic Health Initiatives, MedAmerica Health Systems, Samaritan Health Partners, and Upper Valley Medical Center, operating under a joint operating agreement, constituted a single entity incapable of conspiring in violation of Section 1 of the Sherman Act.  The Medical Center at Elizabeth Place v. Premier Health Partners, et al., Case No. 3:12-cv-26 (S.D. Ohio, Oct. 21, 2014).

As health care providers and health industry participants seek to find innovative ways to collaborate, this case is an important reminder that courts place significant emphasis on how joint venture participants function and operate rather than the corporate form of the organization.  The case also highlights that the examination of conspiratorial capacity involves a highly factual inquiry where principal considerations include a parent’s or general partner’s ability to control the actions of the affiliates or members and the resultant unity of interest between the joint venture participants.

Read more about the underlying rationale of the court’s decision in the following Antitrust Alert Ohio District Court Deems Hospital Alliance a Single Entity Incapable of Conspiring Under the Antitrust Laws.

OCR’s New Bulletin on Ensuring Privacy in Public Health Emergencies

Posted in Hospitals & Health Systems, Long-term Care/Skilled Nursing Facilities, Physicians, Privacy & Security/HIPAA/HITECH, Uncategorized

Written By: Stephanie D. Willis

This week, the HHS Office of Civil Rights (OCR) issued a bulletin (Bulletin) to remind covered entities and business associates that “the protections of the Privacy Rule are not set aside during an emergency.”  

The Bulletin’s information on appropriate disclosures and protections under emergency circumstances is especially timely in the wake of the United States’ recent experience with disclosing information about patients diagnosed with and treated for Ebola and enterovirus-d68.  Because the HIPAA Privacy Rule only provides a very limited waiver of sanctions and penalties against a covered hospital for acts during a public health or other emergency under the Project Bioshield Act and section 1135(b)(7) of the Social Security Act (and only if the U.S. President declares a public health emergency or disaster and the Secretary of HHS declares a public health emergency), covered entities and business associates cannot afford to abandon HIPAA’s privacy and security mandates.

An easy way for covered entities and business associates to parse the Bulletin’s guidance is to ask the following four questions:

  1. Who wants the patient information?
  2. Why does the requestor want the information?
  3. How urgently does the requestor need the information?
  4. What patient information can be given (with or without patient consent)?

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CMS Finalizes OPPS Rule Packaging Pathology Services Ordered for Hospital Outpatients

Posted in Clinical Laboratories, Hospitals & Health Systems, Reimbursement

Written by: Karen Lovitch and Lauren Moldawer*

As part of the Outpatient Prospective Payment System (OPPS) Rule issued last week, the Centers for Medicare & Medicaid Services (CMS) finalized its proposal to conditionally package certain ancillary services assigned to APCs with a “geographic mean cost” of $100 or less.  This change, which will take effect on January 1, 2015, will apply to the technical component of most anatomic pathology services.  Because the hospital’s payment for the primary procedure will cover these services, the hospital may no longer bill for them separately.  But physicians can continue to seek reimbursement under the Medicare Physician Fee Schedule for the professional component of the service. Continue Reading

ML Strategies Posts Weekly Health Care Update on November 3, 2014

Posted in Clinical Laboratories, Health Care Reform, Hospitals & Health Systems, Payors & PBMs, Physicians, Reimbursement

ML Strategies has posted its weekly Health Care Update. This publication provides timely information on implementation of the Affordable Care Act, Congressional initiatives affecting the health care industry, and federal and state health regulatory developments.

At the end of last week, CMS released a series of highly anticipated rules, finalizing Medicare payment policy for FY 2015. Additionally, policymakers continue to focus on Ebola from new funding opportunities to Congressional hearings that could leverage additional resources and authorities in the Obama Administration’s fight against the growing public health threat.

Click here to read this week’s full Health Care Update.