Health Law & Policy Matters

Health Care Attorneys | Mintz Levin Law Firm

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.

CME Payments Largely Remain Excluded From Sunshine Act Reporting

Posted in Pharma & Medical Devices

Written by:  Brian P. Dunphy

The Centers for Medicare & Medicaid Services (“CMS”) has finalized changes to a number of reporting requirements under the regulations implementing the Physician Payments Sunshine Act (“Final Rule”).  When CMS proposed several of these changes in July, my colleague discussed them in detail in an earlier post.  The changes will become effective for the 2016 reporting year (pharmaceutical and medical device manufacturers (“Manufacturers”) will submit reports to CMS covering 2016 in 2017).

The Final Rule includes four changes.  First, CMS eliminated a separate reporting exclusion for payments to physicians for speaking at accredited or certified continuing medical education (“CME”) programs.  Even though CMS eliminated this CME-specific exclusion, most of these CME payments will still not have to be reported.  CMS decided that, where a Manufacturer provides funding to a third-party CME provider for physicians to attend or to speak at a CME program, these payments are not reportable “indirect payments” if the Manufacturer does not “require, instruct, direct, or otherwise cause” the CME provider to direct the payment to a specific physician.  CMS further explained that a CME payment does not become reportable if the Manufacturer later learns the physician’s identity “because the payment or other transfer of value did not meet the definition of an indirect payment.”  With respect to tuition fees for physician attendees, CMS will issue “sub-regulatory guidance specifying [that] tuition fees provided to physician attendees that have been generally subsidized at continuing education events by manufacturers are not expected to be reported.”

Second, Manufacturers must report the marketed name and therapeutic area or product category of the covered drug, device, biological, or medical supply to which the payment or transfer of value was related (previously, Manufacturers of drug or biologicals had to report marketed names, and Manufacturers of devices or medical supplies had to report either the marketed name, product category, or therapeutic area).  For payments related to non-covered products, reporting the marketed name will remain optional.

Third, Manufacturers must report payments in the form of stocks, stock options, or any other ownership interest as distinct forms of payment under 42 C.F.R. § 403.904(d).  Previously, these distinct forms of payment were grouped together in a single “form of payment” category.

Finally, CMS eliminated the definition of “covered device” because it is duplicative of the definition of “covered drug, device, biological or medical supply.”

Although most of these four changes are not contentious, the proposed elimination of the reporting exclusion for certain CME payments proved controversial when the proposed Sunshine Act changes were announced in July 2014.  But with the interpretation that CMS adopted in the Final Rule, which will keep many CME payments from being reported, CME coalitions largely applauded the change.

Key Takeaways from OIG’s 2015 Work Plan

Posted in Clinical Laboratories, Fraud & Abuse, Health Care Reform, Home Health & Hospice, Hospitals & Health Systems, Payors & PBMs, Pharma & Medical Devices, Physicians, Reimbursement

Written by: Laurence J. Freedman, Theresa Carnegie, and Kimberly Gold

The U.S. Department of Health and Human Services (HHS) Office of Inspector General (OIG) released its Fiscal Year 2015 Work Plan on October 31.  The Work Plan provides the OIG’s planned reviews and activities with respect to HHS programs and operations during the current fiscal year and beyond.

In the introduction to the Work Plan, OIG stated that, in the coming year, it plans to continue to focus on issues such as emerging payment, eligibility, management, IT security vulnerabilities, care quality and access in Medicare and Medicaid, public health and human services programs, and appropriateness of Medicare and Medicaid payments.

OIG’s course remains relatively steady, with a wide range of reviews under Part A and Part B, and additional close scrutiny of certain Medicare Advantage and prescription drug plan issues.  OIG has added substantial areas of review under the Affordable Care Act of 2010, now that enrollment and exchanges are in the implementation stage. Continue Reading

The Contraception Coverage Controversy Continues…

Posted in Health Care Reform, Payors & PBMs, Reimbursement

Written by: Tara E. Swenson and Bridgette A. Wiley

As we have been discussing, the Affordable Care Act (“ACA”) requires all health plans to cover preventive health services for women, including all Food and Drug Administration (“FDA”)-approved contraceptives, at no cost (i.e. no deductibles, coinsurance, or co-payments).  The subsequent regulations issued to implement this requirement resulted in protests from religious employers who believe that forcing them to offer and pay for contraceptive services, something to which they are religiously opposed, violates their first amendment right to religious freedom.

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CMS Announces Plan for Reporting Returned Sunshine Act Payment Data

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

Written by: Kate Stewart

On October 30, 2014, the Centers for Medicare and Medicaid Services (“CMS”) announced the procedure for applicable manufacturers and group purchasing organizations (“GPOs”) to report payment and ownership information that was previously excluded from reporting in the Open Payments system due to data errors.  Applicable manufacturers and GPOs will have until the end of the 2014 data submission and attestation period (expected to be March 31, 2015) to submit the corrected reports for the 2013 reporting year. 

Applicable manufacturers and GPOs were initially required to report payments made to physicians and teaching hospitals and ownership interests held by physicians for the period running from August 1, 2013, to December 31, 2013, by June 30, 2014.  As previously reported, after the initial reporting of 2013 data, CMS temporarily shut down the Open Payments system to address problems with data submissions.  After the shutdown, approximately one-third of the submitted records were flagged as having errors related to the identity of the recipient of the payment.  These payments were not included in the data that was publicly released on September 30, 2014. 

Applicable manufacturers and GPOs can now download a Removed Records Report from the Open Payments system showing the records that were removed.  A guide for correcting records is also available.  CMS will host a webinar on November 13, 2014 at 1:00pm EST to address the re-submission of data.

Ebola Update–CDC Issues New Protocols

Posted in Accreditation, Licensing & Certification, Hospitals & Health Systems

Written By: Rachel Irving Pitts

Copyright 2014, American Health Lawyers Association, Washington, DC. Reprint permission granted.
This post was originally written for an email alert to the Regulation, Accreditation, and Payment (RAP) Practice Group of the American Health Lawyers Association. Our thanks to AHLA for permission to reprint here. 

The response to Ebola continues to evolve as additional resources for providers and the public have been made available over the last several days. The Joint Commission (TJC) launched an Ebola Preparedness Resources webpage, which hosts TJC’s relevant internal resources and links to “credible, useful outside resources,” including the Centers for Disease Control and Prevention (CDC). While stressing that the CDC remains a primary source of information regarding Ebola, TJC is providing these resources in response to providers’ expectations for guidance, and asking providers to focus on infection prevention by performing a comprehensive evaluation of their practices and providing ongoing infection prevention education, training, and assessment. Non-compliance with infection prevention standards (hand hygiene, use of personal protective equipment (PPE), sterilization, and disinfection) is a persistent issue encountered by TJC when it surveys its accredited hospitals. The Ebola Preparedness Resources webpage includes educational podcasts, infographics, and articles on infection prevention and control and managing contagious patients, along with New England Journal of Medicine and Journal of the American Medical Association articles about Ebola, media coverage, and links to external resources–including the CDC’s “Guidance on Personal Protective Equipment To Be Used by Healthcare Workers During Management of Patients with Ebola Virus Disease in U.S. Hospitals, Including Procedures for Putting On (Donning) and Removing (Doffing).”

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HHS Announces $840 Million Initiative to Improve Patient Care and Lower Healthcare Costs

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

Written by: Carrie A. Roll and Andrew J. Shin

Last week, the Department Health and Human Services (HHS) announced that it will invest $840 million over the next four years to support 150,000 clinicians through a combination of incentives, tools, and information to encourage clinicians and other health care providers “to move from volume-driven systems to value-based, patient-centered, and coordinated health care services.” CMS Deputy Administrator for Innovation and Quality and Chief Medical Officer Patrick Conway said the initiative is expected to save between $1 billion and $5 billion over four years and could result in reducing five million avoidable hospitalizations. Mr. Conway described the initiative as “part of a larger strategy for health system transformation.”

As noted in the announcement, the initiative is one part of a strategy advanced by the Affordable Care Act (ACA) to further the goal of putting quality care first and prioritizing efforts to reduce healthcare costs. Under ACA, the Center for Medicare & Medicaid Innovation (CMMI) received $10 billion to develop and test new health care delivery models as part of an effort to move away from the traditional fee-for-service model, improve quality of care, and lower costs.

Some stakeholders believe this newest initiative is the next logical step following on the heels of the massive $1 billion Partnership for Patients campaign that included over 3,700 hospitals in various quality-improving initiatives. Responding to some criticism that the majority of efforts from the Obama Administration have been focused on hospitals, the Transforming Clinical Practice Initiative (TCPI) targets smaller practices through peer-based learning networks that include physicians, physician assistants, nurse practitioners, and clinical pharmacists. Interestingly, eligible applicants for TCPI are more similar to those who were able to participate in the Partnership for Patients, as opposed to individual clinical practices themselves.

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Managing Antitrust Risks in Pre-Transaction Planning

Posted in Health Care Reform, Hospitals & Health Systems, Mergers, Acquisitions & Other Transactions, Payors & PBMs, Pharma & Medical Devices, Physicians, State & Federal Audits, Investigations & Litigation

Dynamic changes in the nation’s health care delivery systems have been prompted, in part, by the implementation of the Patient Protection and Affordable Care Act (“ACA”).  In the wake of the ACA, hospitals and other health care industry participants have been undergoing significant consolidation.  Health care antitrust enforcers continue to closely scrutinize health care transactions in order to ensure that new health care delivery systems do not enhance or create market power or otherwise harm consumers.  As such, there are certain steps deal counsel should take in order to effectively manage and minimize potential antitrust risks in transactions with competitors.

In part one of a three part series, my colleagues, Dionne Lomax and Farrah Short, offer a planning checklist for transactions with potential competitive concerns.  Click here to read the full article.

Office for Human Research Protections Releases Draft Guidance

Posted in Clinical Trials & Research/FDA, Hospitals & Health Systems

Written by: Kate Stewart

On October 24, 2014, the Office for Human Research Protections (OHRP) announced in the Federal Register that it has released, and is seeking comment on, its Draft Guidance on Disclosing Reasonably Foreseeable Risks in Research Evaluating Standards of Care (“Draft Guidance”).  The Draft Guidance addresses how researchers evaluate and characterize the risks to participants in research comparing current standards of care and how those risks are expressed in informed consent documents.

As comparative effectiveness research becomes more common, driven in part by funding under the Affordable Care Act, questions have arisen regarding whether the risks of undergoing a specific standard of care constitute research risks that must be considered by Institutional Review Boards (“IRBs”) and disclosed to study participants. The Draft Guidance follows OHRP’s 2013 compliance oversight determination letter, and subsequent controversy, regarding the informed consent process in the Surfactant, Positive Pressures, and Oxygenation Randomized Trial (“SUPPORT”).

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Ebola Exclusions from Commercial Insurance Policies

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

Written by: Heidi Lawson and Scott Rader

Last week we wrote about a new business interruption insurance policy that is being rolled out to healthcare providers which will provide specific coverage for various ebola-related losses.  This week we note that some business insurers are beginning to specifically exclude ebola-related losses from their standard commercial insurance policies.  This raises what might seem to be an obvious question:  are ebola-related losses currently covered by standard business interruption provisions (in which case it would seem redundant for an insurer to specifically add this coverage) or are they currently excluded (in which case it would seem unnecessary for an insurer to specifically exclude it)?  But these apparently opposite reactions can be seen as reflecting a common theme among insurers:  because ambiguities in an insurance contract typically are construed in most jurisdictions against an insured, insurers prefer for their policies to be as explicit as possible (particularly when it comes to exclusions) to ensure that policyholders cannot make a claim for coverage as a result of an ambiguity.  The tendency for insurers to do so highlights why insureds typically should retain counsel to review their policies to make sure their expectations about what will be covered are reflected by their policy’s language.  For more information about how this ebola exclusion could affect your business or for a more general review of your business’s insurance policies, please contact Scott Rader, Elizabeth Kurpis or Heidi Lawson.