The Department of Health and Human Services Office of Inspector General (OIG) recently implemented a new safe harbor to the federal Anti-Kickback Statute and beneficiary inducement statute, which went into effect on January 6, 2017.1 The new safe harbor, which was published by the OIG in a final rule dated December 7, 2016,2 protects the provision of free or discounted local transportation by eligible entities to Medicare or Medicaid beneficiaries, provided that certain conditions are met. While non-compliance with the safe harbor does not necessarily mean that a transportation arrangement will violate the Anti-Kickback Statute, children’s hospitals should take note of the safe harbor requirements and assess whether any of their existing transportation arrangements should be restructured. Continue Reading New Local Transportation Safe Harbor to the Anti-Kickback Statute and Beneficiary Inducement Statute
On May 9, 2016, the Middle District of Pennsylvania in FTC et al. v. Hershey Medical Center et al. (“Hershey”) denied a preliminary injunction request by the FTC to block a merger between Penn State Hershey Medical Center and PinnacleHealth System. The District Court rejected the FTC’s request based on its finding that the FTC’s geographic market definition was “unrealistically narrow and does not assume the commercial realities faced by consumers in the region.” The proper geographic market is one from which the defendant hospitals draw the bulk of their patients, with few patients entering in from outside that area to seek medical care and few patients within that area leaving to seek care from other hospitals. The District Court found the FTC’s proposed geographic market to be “starkly narrow,” particularly “given the realities of living in Central Pennsylvania, which is largely rural and requires driving distances for specific goods and services.” By failing to set forth a relevant geographic market, the District Court held that the FTC could not demonstrate a likelihood of success on the merits of its Clayton Act case against the merger and denied the preliminary injunction. Continue Reading Court Tells FTC in Hershey to Kiss Off
Gov. John Bel Edwards signed an executive order Jan. 19, 2016, to make Louisiana the 32nd state to adopt Medicaid expansion under the Affordable Care Act. Montana’s Medicaid expansion became effective Jan. 1, and South Dakota, Virginia and Wyoming are including Medicaid expansion in upcoming state budget proposals.
This is reflective of a growing trend of so-called “red” states that are nevertheless adopting provisions of the Affordable Care Act that subsidize healthcare costs for new groups of citizens who cannot afford commercial or exchange insurance products and do not qualify for Medicare. To sweeten the pot, the Obama administration announced its 2017 budget proposal will include a legislative proposal to provide any state that expands Medicaid coverage under the Affordable Care Act with the same three years of full federal funding that states that expanded their Medicaid programs in 2014 enjoyed. Continue Reading Red states see green: Opportunities for children’s hospitals