Last week, the Centers for Medicare & Medicaid Services (CMS) announced that new Medicare cards would be issued starting next month. As we previously reported, the government has been planning to revamp the card to reduce fraud. Medicare cards have historically included a SSN-based Health Insurance Claim Number (HICN) that was an easy target for identity thieves and fraudsters. A new randomly-generated Medicare Beneficiary Identifier (MBI) will replace the HICN on the new cards.

The move to issue new cards was set in motion by the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA), which requires SSNs to be removed from Medicare identification cards within four years after MACRA’s enactment.

CMS will have a transition period during which either the HICN or the MBI can be used to exchange data with CMS. The transition period is set to begin no earlier than April 1, 2018, and run through December 31, 2019.

For those looking for additional information, CMS has created presentations explaining the card’s impact on different health care industry stakeholders.

On Monday, our colleagues Bruce Sokler and Farrah Short released a client alert: Attempted Monopolization Suit Based on Alleged Referral Steering Moves Forward with Court’s Acceptance as Plausible of a Geographic Market Limited to a Single Hospital.

The client alert discusses the holding in a recent monopolization suit brought by a private home health agency against a dominant public hospital system and its own home health agency. In its suit, the plaintiff alleges, among other things, that the hospital’s computer discharge system is set up to favor a home health agency owned by the hospital system.

The alert provides insight into how the plaintiff overcame procedural challenges, as well as an analysis of the substantive issues related to intra-system referrals.

Last week, the U.S. Attorney’s Office for the District of Massachusetts announced that it had entered into an agreement with a Massachusetts-based medical device manufacturer to settle allegations that the Company had violated the False Claims Act by purchasing lavish meals for physicians to induce them to use heart pumps manufactured by the Company.

The government’s allegations are not particularly novel, but do serve as an important reminder to health care providers and suppliers that it is important to institute, and remain vigilant about, sound compliance practices across all areas of their business.  These allegations also make clear that the government continues to be focused on providers’ and suppliers’ sales and marketing practices. Continue Reading Recent FCA Settlement Shows That What’s Old Is New in Health Care Fraud Enforcement

This week, Congress returns to Washington with 11 days to finalize a government spending bill. Standing in the way are a number of unresolved health care issues, including drug pricing and market stabilization. There are a number of moving parts that will begin to come together this week. Also on our radar screen is the ongoing marketplace issues in the state of Idaho, where the federal government is urging the state to consider short-term limited duration insurance plans. We cover this and more in the health care preview, which you can find here.

The Department of Justice (“DOJ”) Antitrust Division recently announced plans to hold a series of public roundtable discussions to analyze the relationship between competition and regulation, and its implications for antitrust enforcement policy.  As the Antitrust Division continues to scrutinize the healthcare industry, these roundtables may give a window into the Division’s current thinking about mergers and acquisitions and contracting practices in the industry.  The roundtable series starts on Wednesday, March 14, 2018, with a focus on antitrust exemptions and immunities, including a focus on the appropriate role of the state action doctrine.  The roundables will include perspectives from various industry participants as well as “academics, think tanks, and other interested parties to discuss the economic and legal analyses of competition and deregulation.”  The second roundtable will be held on April 26, 2018, and will focus on consent decrees.  The third roundtable will be held on May 31, 2018, and will analyze the consumer costs of anticompetitive regulations.  The DOJ will accept public comments (not to exceed 20 pages) in advance of each of the roundtables.  The federal antitrust agencies often hold public events of this nature to further inform their antitrust enforcement agendas.  It will be interesting to see if this roundtable series results in any major enforcement policy changes for the Antitrust Division, which is now under the leadership of Assistant Attorney General, Makan Delrahim.

On February 22, the Wall Street Journal published an article about the tissue graft manufacturer MiMedx Goup, Inc. and its failure to report payments to physicians under CMS’s Open Payments Program established by the Centers for Medicare & Medicaid Services under the Patient Protection and Affordable Care Act (P.L. 111-148, Sec. 6002, amending Social Security Act Sec. 1128G), also known as the Physician Payments Sunshine Act (PPSA).  MiMedx executives claim that such reporting is unnecessary because the company’s products are tissues, which are not explicitly included in the regulatory definition of “covered drug, device, biological, or medical supply” to which the Open Payments Program apply (42 C.F.R. 403.902). As a result of falling outside this definition, MiMedx argues that it is not an “applicable manufacturer” required to disclose payments to physicians and teaching hospitals.  MiMedx’s product-specific reasoning aside, the company’s argument brings up an interesting point about the evolution of FDA-regulated products and the enforcement of the Open Payments Program requirements: Does the PPSA, and its corresponding regulations, require manufacturers of tissue-based therapies to disclose payment information? Continue Reading Are HCT/Ps a Dark Spot in the Sunshine Act Requirements?

The Department of Justice (DOJ) recently intervened in a False Claims Act (FCA) case that raises a variety of interesting allegations, including payment of kickbacks by a compounding pharmacy to contracted marketing companies in the form of percentage-based compensation, to TRICARE beneficiaries in the form of copayment waivers, and to physicians who submitted prescriptions without seeing patients.  According to the complaint, Patient Care America (PCA), a Florida compounding pharmacy, implemented a scheme to manipulate the compounding formula for pain and scar creams that resulted in the submission of false claims to TRICARE.  The complaint also names two of PCA’s senior executives (one of which has since left the company) as well as the private equity firm that owns a controlling interest in PCA. Continue Reading DOJ Intervenes in False Claims Act Case Against a Compounding Pharmacy and a Private Equity Firm

Congress has three weeks to finalize an omnibus spending package. There are a number of issues that are expected to come up, including market stabilization and drug pricing, among other issues. There’s also activity at the state level on Medicaid waivers and work requirements. We cover this and more in this week’s preview, which you can find here.

CMS has slowly but surely been providing additional guidance to Medicare Plans (Medicare Advantage and Part D plans) regarding steps they can and should take to address the opioid epidemic as it relates to their beneficiaries. CMS’s most recent guidance to Plans regarding the opioid epidemic was included in the Advance Notice and Call Letter.

In November of 2017, in the proposed Medicare Advantage and Part D regulations for CY 2019 CMS set out a framework for Part D plans to monitor and reduce the potential misuse of prescription opioids. Continue Reading CMS’s Advance Notice and Call Letter: How Medicare Plans Can Report, Identify, and Address the Opioid Epidemic

Congress is back in session and will begin its work in finalizing a final spending bill for fiscal year 2018. Both chambers are considering new ways to address the opioid crisis, and we should expect a renewed push around gun control and mental health. We cover this and more in this week’s health care preview.