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Ryan Cuthbertson is an Associate in the Health Law Practice and focuses primarily on transactional and regulatory matters, including mergers and acquisitions, joint ventures, regulatory compliance review, and licensing activities.  Ryan has also provided due diligence support, and insurance, licensing, and other regulatory guidance to pharmacies, pharmacy benefit managers, laboratories, durable medical equipment suppliers, hospital systems, dialysis and long-term care providers, medical practices, and payors.

Before joining the firm, Ryan spent nearly 10 years as an acquisitions officer in the US Air Force, where he was responsible for managing cost, schedule, and performance of various defense development programs.

A New Jersey Supreme Court case earlier this summer has New Jersey lawyers re-examining their clients’ business structures under the State’s corporate practice of medicine doctrine.

Many states prohibit the corporate practice of medicine (“CPOM”) in order to prevent or limit a lay person from interfering with a physician’s independent medical judgment. In New Jersey, for example, the State Board of Medical Examiners’ regulations prohibit a licensee with a more limited scope of practice (e.g., physical therapists, chiropractors, nurse practitioners, etc.) from employing physicians.

In Allstate Ins. Co. v. Northfield Med. Ctr., P.C., 2017 BL 148804 (N.J. May 4, 2017), the New Jersey Supreme Court  ruled that a chiropractor (and his attorney that advised on the structure) may have violated the Insurance Fraud Prevention Act because, under the structure,  a chiropractor could terminate a physician’s employment at any time and had more control over the practice’s profits than the physician (who is required to own a majority interest of the practice in New Jersey).  Thus, the court ruled that the medical practice was controlled by the chiropractor instead of the physician in violation of the New Jersey CPOM prohibition.

Submitting claims while a practice is structured in violation of the CPOM doctrine can lead to insurers recouping payments as false claims. Individual physicians, corporations, and attorneys can also face disciplinary action for their involvement in setting up or operating the fraudulent entity.

It is important that the organizational documents are set up to give the physician control over the practice, but this control should be exercised in reality and not just on paper. Physicians often have managers run many of the business aspects of the practice, but the physician should have the final say with respect to the medical and financial decisions of the practice and the hiring and firing of professionals.  Courts may look past the face of the documents to see who is really calling the shots on a daily basis.

While this recent case is spurring attorneys to evaluate their clients’ structures in New Jersey, this is a good reminder to take a fresh look at CPOM restrictions in other states as well.  Make sure your structure works at the outset and re-examine every so often to adapt with evolving laws and court interpretations of such laws.

In the recently published proposed rule related to the CY 2018 Hospital Outpatient Prospective Payment System (OPPS), the Centers for Medicare & Medicaid Services (CMS) announced that it is considering changes to the regulation governing the date of service (DOS) for clinical laboratory and pathology specimens.  The DOS rules are important to laboratories and hospitals because they dictate which party must bill Medicare for certain laboratory testing performed on stored specimens collected during a hospital procedure but ordered after the patient has left the hospital.  If revisions are ultimately finalized, the proposal could have significant business implications for independent laboratories and hospitals.

Continue Reading CMS May Decide to Permit Labs to Bill for Certain Tests Provided to Outpatients

Last week, the HHS Office for Civil Rights (OCR) launched an improved version of their HIPAA Breach Reporting Tool (HBRT), commonly referred to by OCR and regulated entities alike as the HIPAA “Wall of Shame.” OCR has also made minor changes to the interface for breach reporting.

The HBRT now makes it easy to navigate and mine information on all reported data breaches (breaches must be reported when they involve the protected health information of 500 or more people). Continue Reading The HIPAA “Wall of Shame” is Now Easier to Navigate

Earlier this month, the Office of the Inspector General for the Department of Health and Human Services (“OIG”) published its Semiannual Report to Congress covering the period from October 1, 2016 to March 31, 2017.  The report describes OIG’s work and accomplishments during the 6-month reporting period. Like other OIG reports, including the annual OIG Work Plan, the report gives a good indication of priority areas for OIG and can help guide compliance priorities for providers.  Below are some highlights of the report in the following focus areas: Continue Reading OIG Publishes Semiannual Report to Congress

A bipartisan congressional effort is underway to convince CMS to reverse its biosimilar reimbursement policy implemented under the Obama administration. We discussed the current reimbursement policy in a March 2016 blog post when CMS initially released the guidance.  CMS implemented the controversial guidance as a final rule in October 2016.

The current policy requires all biosimilars that are related to a reference product to be given a shared Healthcare Common Procedure Coding System (HCPCS) code. For Medicare Part B, reimbursement is then calculated based on the average sales price (ASP) of all of the biosimilars with that HCPCS code plus 6% of their reference product’s ASP. Continue Reading CMS Urged To Reverse Obama-Era Biosimilar Reimbursement Policy

ML Strategies has published the first installment of a new weekly preview, designed to give you quick overview of health happenings in the coming week. The preview highlights upcoming activity in the House and Senate and other hot topics on the Hill.

Spoiler alert: the confirmation processes for Dr. Scott Gottlieb (FDA) and Judge Neil Gorsuch (Supreme Court) will get a lot of attention this week.

See HERE for this week’s preview and be sure to stay tuned in the coming weeks.

Earlier this month, Mintz Levin’s Health Care Enforcement Defense Group published its most recent Health Care Qui Tam Update that looks at 18 health care-related qui tam cases unsealed in October and November of 2016.

The Update presents two unique cases in-depth and covers some of the trends revealed in these recently unsealed cases:

  • The cases identified were filed in federal district courts in 12 states, including California (5), New York (3), Alabama (1), Arkansas (1), Florida (1), Hawaii (1), Kansas (1), New Jersey (1), New Mexico (1), North Carolina (1), Oklahoma (1), and Pennsylvania (1).
  • The federal government declined to intervene in nine of the 18 cases. Five more cases were voluntarily dismissed before any action was taken by the government. The federal government intervened, in whole or in part, in three cases. In the two remaining cases, the government’s intervention status could not be discerned from the unsealed filings.
  • Nature of the Claims
    • Nine of the recently unsealed cases included both state and federal claims.
    • Four involved allegations of unlawful kickbacks. Of these, two also alleged violations of the Stark Law (42 U.S.C. § 1395nn).
    • Claims for relief under state or federal anti-whistleblower retaliation provisions appeared in nine of the 18 recently unsealed cases.
    • The cases remained under seal for an average of just over two years (774 days). The median number of days cases remained under seal was 573.5. United States ex rel. DiBenedetto v. Vahedi, which was heard in the U.S. District Court for the Central District of California, was under seal for the shortest amount of time, at 104 days. United States ex rel. Harmsen v. Moore County Dental Care Center, which was filed in the U.S. District Court for the Middle District of North Carolina, was under seal the longest, at 2,075 days (over five and a half years)
  • In nearly three-quarters of the unsealed cases (13 of 18), relators were current or former employees of the defendant.

See HERE for the full Update and to find our key takeaways from the cases discussed.

 

Join us next Wednesday, February 15 from 1pm – 2pm Eastern for the final installment of our three-part webinar series on the 21st Century Cures Act (the “Cures Act”).  Part III of the series will focus on the Cures Act’s impact on the FDA and will have some great takeaways for anyone who interacts with the FDA or has an interest in the Cures Act.

In this presentation, our colleagues Bethany Hills and Joanne Hawana will discuss the following FDA-related provisions of the Cures Act and take a deep dive into the practical implications and implementation processes for each of:

  • Regenerative Medicine
  • Medical software/digital health
  • FDA restructuring/structural improvements
  • Health care economic info and off-label communications
  • Data source changes – patient experience, RWE and summary data

Click HERE to register!

Today, my colleagues Laurence Freedman, Samantha Kingsbury, and Karen Lovitch released the latest in our ongoing series reviewing health care enforcement activities in 2016 and their impacts looking forward to 2017. The client alert highlights major case law developments that influenced health care enforcement in 2016 and that will likely have major effects on the health care industry in the year ahead.

The client alert addresses the following issues raised by these important cases and what each might mean in 2017:

  • Implied false certification theory and materiality requirement (Escobar)
  • Anti-Kickback Statute discount exception and safe harbor (Organon; CCS Medical)
  • Proof of falsity in False Claims Act medical necessity cases (AseraCare)
  • Statistical sampling to prove liability in False Claims Act cases (Agape; Life Care Centers of America)

Please refer to our Health Care Enforcement Review and 2017 Outlook blog post series for additional insights on key government policies, regulations, and enforcement actions from 2016 and their expected impact on health care enforcement in the year ahead. We also encourage you to sign up for our annual webinar, Health Care Enforcement Review & 2017 Outlook, which will take place on Wednesday, January 25 at 1:00 p.m. ET.  Registration and additional information are available here.

As we’ve previously reported, the Massachusetts Department of Public Health (DPH) has recently proposed a number of amended regulations in connection with the regulatory review and overhaul mandated by Governor Baker’s Executive Order 562. Senior DPH staff presented these proposed regulations at a Public Health Council Meeting on September 14 (the “PHC Meeting”).  Today we are looking at proposed regulations related to Dialysis Units.  For our prior analysis of the proposed regulations on hospital licensing, please see here. Continue Reading Massachusetts Dialysis Unit Licensing Proposed Regulations – Key Take-Aways