On July 13, the Centers for Medicare & Medicaid Services (“CMS”) put out its 2018 Medicare Hospital Outpatient Prospective Payment System Proposed Rule. The Rule proposes, among other things, to dramatically reduce Medicare Part B reimbursement of drugs procured by hospitals at 340B prices—from the current rate of Average Sales Price (“ASP”) plus 6 percent to ASP minus 22.5 percent. By CMS’s estimate, this could result in savings to the Part B program of $900 million and a corresponding cut to the 340B hospitals which currently receive those payments (and ostensibly use them in furtherance of the 340B program’s goal of assisting safety net providers in stretching their scarce resources). Continue Reading CMS Proposes Drastic Reduction to Medicare Part B Reimbursement of 340B Drugs
On June 5, 2017, the U.S. Supreme Court held that the employee benefit plans of church-affiliated hospitals and healthcare facilities may be exempt from the federal Employee Retirement Income Security Act of 1974 (ERISA), in Advocate Health Care Network et al. v. Stapleton et al. More background information can be found in our December legal alert on this case.
On May 23, 2017, Texas Governor Greg Abbott signed Senate Bill (SB) 507, expanding the current law dealing with “balance billing.”
Balance billing occurs when an insured patient receives care from a physician, hospital or other healthcare provider, who is not part of a patient’s health plan provider network. The out-of-network provider then bills the patient directly for the portion of medical expenses not covered by insurance, typically at a much higher rate.
In 2009, Texas passed legislation establishing a Texas Department of Insurance (TDI) mediation system aimed at resolving balance billing issues. The 2009 legislation made mediation available to patients who were balanced billed by six types of facility-based providers: radiologists, anesthesiologists, pathologists, ER physicians, neonatologists and assistant surgeons. Effective September 1, 2017, SB 507 expands access to balance billing mediation eligibility to all types of out-of-network providers treating patients at in-network hospitals and other facilities, including freestanding ERs. SB 507 also allows mediation for emergent care balance bills over $500 at any healthcare facility, whether in or out of network. The legislation will cover Texans with PPO plans receiving care from an out-of-network provider at an in-network facility. It will also cover the Teachers Retirement System, in addition to the Employee Retirement System covered by the original legislation.
SB 507 also expands disclosure requirements on network status by health plans, facilities, and other healthcare providers. These new requirements include, among other things, that a bill sent to a patient contain an explanation of the mediation process, and a statement that is substantially similar to the following:
“You may be able to reduce some of your out-of-pocket costs for an out-of-network medical or health care claim that is eligible for mediation by contacting the Texas Department of Insurance at (website) and (phone number, including requiring that the following statement be added to balance bills.”
Providers should become familiar with the new balance billing requirements to determine how they will impact current billing practices. A full copy of SB 507 is available at Texas Legislature Online.
The U.S. Court of Appeals for the Third Circuit held recently that Title IX of the Education Amendments of 1972 (“Title IX”)—which prohibits sex discrimination in the “education programs or activit[ies]” of entities receiving federal financial assistance—can apply to residency programs at hospitals. The ruling may profoundly impact how hospitals respond to complaints of sex discrimination (including sexual harassment) by resident physicians and necessitate that hospitals comply with federal Title IX regulations and guidance. The ruling also opens the door for residents who experience sex discrimination to sue under Title IX, thereby avoiding the complex administrative exhaustion process required to file a similar claim under Title VII of the Civil Rights Act of 1964, which generally governs sex discrimination in the workplace. For more information on this new development, visit the legal alert authored by Derek Teeter and Lorinda Holloway.
This is the fifth article in our series on the effect of the “slow repeal” of the Affordable Care Act (ACA). This week’s article focuses on the potential impact of the slow repeal of the ACA on rural communities and healthcare.
Continued Fragile System Leads to Uncertainty or Closure Causing Economic Ripple Effect Throughout Rural America
There are nearly 5,000 short-term, acute care hospitals in the United States, half of which are in rural areas. About four in 10 rural hospitals are located in the South. More than half of rural hospitals are Critical Access Hospitals (CAHs) (53.5%); a smaller share of rural hospitals are designated as Sole Community Hospitals (SCHs) (13%), Medicare Dependent Hospitals (MDHs) (8%), and Rural Referral Centers (RRCs) (11%). All of these designations provide enhanced or supplemental reimbursement under Medicare, using different formulas. Rural hospitals that do not qualify for these Medicare programs are reimbursed as standard Medicare Prospective Payment System (PPS) hospitals. Continue Reading Slow Repeal of the ACA and Its Impact on Rural Healthcare and Communities
Emerging Issues in Healthcare Law is coming to the Big Easy. The American Bar Association’s 18th annual conference is slated for New Orleans March 8-11.
Husch Blackwell is a platinum sponsor of this event featuring the most emergent topics facing the healthcare bar. As the industry faces changes and continues to grow under healthcare reform and enforcement, this conference allows attendees a perfect opportunity to stay ahead of the developments. Continue Reading Don’t miss Emerging Issues in Healthcare Law
On Dec. 7, 2016, the U.S. Department of Health & Human Services Office of Inspector General (OIG) released an update to its 2000 policy regarding gifts of nominal value given to a Medicare or Medicaid beneficiary. The update increases the nominal value of gifts given to a Medicare or Medicaid beneficiary to $15 per occurrence and $75 in the aggregate for a year (the previous limit was $10 per occurrence and $50 in the aggregate). If a gift complies with these limits, the arrangement does not need to fit within a “safe harbor” to 42 U.S.C. §1320a-7b(b) (the federal anti-kickback statute). Continue Reading OIG updates policy regarding gifts of nominal value
In the 2016 Physician Fee Schedule Final Rule published on Nov. 16, 2014, the Centers for Medicare & Medicaid Services (CMS) finalized the proposed exception for timeshare arrangements that we discussed in our earlier blog post [80 Fed. Reg. 70,886, 71,300 (Nov. 16, 2015)]. As we stated in our earlier post, a timeshare or part-time “space use” arrangement typically provides a physician with the use of office space during scheduled time periods. The space usually includes furnishings with basic medical office equipment, supplies and support personnel so that the physician is able to use the space, on a turn-key basis, to see patients during scheduled times. Prior to the implementation of the new timeshare exception, these types of arrangements needed to be structured to comply with the Rental of Office Space Exception, which includes “exclusive use” requirements that many hospitals and physicians found burdensome [42 C.F.R. § 411.357(a)]. Continue Reading CMS finalizes new timeshare exception to the Stark law
Attorneys, compliance officers, accountants, and other professionals who advise clients in the healthcare industry may want to consider attending a coming event next month in Chicago. Featuring Husch Blackwell attorneys Cori Turner and Bill Hopkins, the Fundamentals of Health Law will be held Nov. 15-17.
The American Health Lawyers Association’s event will offer continuing education credits. Continue Reading November in Chicago: Fundamentals of Health Law conference
On August 31, 2015, the Environmental Protection Agency (“EPA”) issued its long-awaited Management Standards for Hazardous Waste Pharmaceuticals Proposed Rule, which is designed to prevent facilities from disposing of hazardous waste pharmaceuticals by flushing them down the toilet or drain. The proposal creates a new subpart under the Resource Conservation and Recovery Act’s (“RCRA”) hazardous waste regulations for the regulation of hazardous waste pharmaceuticals generated by “healthcare facilities” and “pharmaceutical reverse distributors.” Continue Reading EPA proposes new rule for hazardous waste pharmaceuticals