This is the second blog of our Surprise Billing Series. This article will look at California’s Assembly Bill No. 72 which added sections to the California Health and Safety Code and to the California Insurance Code. This bill was one of the first to limit surprise billing and mandate a minimum re-payment amount from insurers for affected out-of-network services and as such has served as a case study for surprise billing legislation.

On September 23, 2016, the California Legislature passed Assembly Bill 72 (“the Law”). The Law applies to Health Care Service Plans regulated by the California Department of Managed Health Care (“DMHC”) and health insurers regulated by the California Department of Insurance (“CDI”) who have issued, amended, or renewed plans or policies after July 1, 2017. The Law has allowed other states across the US, as well as the Federal government, to observe how a change in handling surprise billing could affect patients and health care providers. Continue Reading California Law Serves as a Case Study for Surprise Billing Legislation

This is the first of three blogs in a series discussing the shift many states are beginning to make towards limiting “Surprise” or “Balance Billing.” This first blog will focus on Texas Senate Bill 1264, which looks to end surprise billing in the State of Texas in certain circumstances. The second blog in this series will look at the similar law California passed in 2017 to see what kind of effects that law has had. The final blog in this series will discuss other proposed state and federal laws that look to continue the trend towards ending surprise billing. Continue Reading New Texas Law Poses Limitations on Surprise Billing

Part IV: Healthcare Regulatory Issues that Arise in Private Equity Transactions

This is the fourth article in our series on “Closing a Private Equity Transaction.” In Part I, the benefits of preparing for a transaction were explained, along with how best to prepare. In Part II, the letter of intent was discussed, and key terms were identified and explained. In Part III, we walked through what to expect during the due diligence process. Here, we identify the various healthcare regulatory issues that arise in private equity transactions.

The Healthcare industry is heavily regulated at both the federal and state levels, and regulatory issues will be the greatest area of concern for a buyer. The buyer will review the information disclosed through the due diligence process to confirm both pre- and post-closing regulatory compliance.

No business is perfect, and it’s not uncommon for areas of past non-compliance to be uncovered. A buyer needs to understand what they will be potentially inheriting in terms of risk. This gives the parties a chance to correct deficiencies, which may include a self-disclosure or refund, and make improvements going forward. Continue Reading Ultimate Guide to Closing a Private Equity Transaction

Time is running short on the opportunity to comment on a proposed rule further increasing transparency in hospital pricing.  The rule was released July 29 and was quickly panned by providers and insurers over provisions requiring hospitals to publicly disclose the negotiated rates they have with third-party payers.

Comments on the rule are due September 27, 2019.

Action by the federal government to increase price transparency in health care is not new, of course.  Section 2718(e) of the Public Health Service Act (PHS) was added by the Affordable Care Act to require all hospitals to make public, upon request, the standard charges for the items and services they provide.   Continue Reading Price Transparency in Health Care . . . Panacea or Not

Husch Blackwell is pleased to announce that it has achieved the Mansfield Certification Plus designation for 2019.

To receive Mansfield Certification, law firms must consider at least 30 percent women, attorneys of color or LGBTQ attorneys for 70 percent or more of the firm’s leadership positions. Additionally, the firm was also awarded a “Plus” designation based on its reaching a 30-percent threshold of underrepresented groups in leadership roles. The certification program is operated by Diversity Lab, an entity that verifies law firm hiring practices across the U.S. for diversity and inclusion efforts.

The certification represents a point of emphasis for Husch Blackwell and puts metrics into place to make sure we’re considering underrepresented groups for leadership.

Diversity Lab launched its Mansfield Certification program two years ago, certifying its first class of law firms in 2018. The program’s goal is to achieve higher levels of representation for more diversity in leadership positions in the legal profession. The program is named after Arabella Mansfield, the first woman admitted to practice law in the United States in 1869.

Husch Blackwell is very excited to reach this certification, as it assures that we are affirmatively looking for opportunities for women, attorneys of color and LGBTQ attorneys. We are making progress, but there is still much to accomplish.

As a next step, the firm will seek Mansfield 3.0 Certification, which entails adding those with disabilities to the candidate list for various leadership positions. In addition, the firm will continue to track and apply these Mansfield standards for all of its administrative candidates for director positions and higher.

Part III: Due Diligence

This is the third article in our series on “Closing a Private Equity Transaction.” In Part I, the benefits of preparing for a transaction were explained, along with how best to prepare. In Part II, the letter of intent (LOI) was discussed, and key terms were identified and explained. Next, we walk through the due diligence process, which begins immediately after the parties execute the LOI.

Due diligence is used by both the buyer and seller to confirm the decision to proceed with an ultimate closing. Typically, the buyer’s examination of the seller’s business will be comprehensive and include information covering the past three to five years. This is necessary in order for buyer to understand what it will be purchasing, in terms of profitability, operations, business relationships, and potential liabilities.  Continue Reading Ultimate Guide to Closing a Private Equity Transaction

Private equity buyers have become a significant player in the healthcare M&A space and they continue to focus on those types of healthcare services that have the greatest opportunities for aggregating. Traditional health system buyers have continued to focus on which physician specialties will assist most with alignment and care coordination strategies. While there are many similarities in transactions with these two types of buyers, there are often just as many differences. The following examples illustrate how those interests may vary: Continue Reading Rep and Warranty Insurance has Growing Popularity in PE Deals

Part II: Negotiating the Letter of Intent

This is the second article in our series on “Closing a Private Equity Transaction.” As discussed in “Part I,” advance preparation is critical to getting a deal done. Once preparation for a potential transaction is complete, and an interested buyer or investor is identified, the parties will proceed with negotiating a letter of intent (LOI).

With a few exceptions (which are mentioned below), the LOI is a nonbinding document, but should include those terms essential for both parties to close the transaction. This is the moment when the parties will be in the best position to ensure that the time and expense that will be required for negotiating a definitive purchase agreement will be justified.  Such terms can include: Continue Reading Ultimate Guide to Closing a Private Equity Transaction

Senate Bill 1264, which recently passed during the 86th Texas legislative session, places restrictions on certain out-of-network providers regarding the practice known as “balance billing” and establishes a process through which health plans and providers may resolve payment disputes. The bill is effective September 1, 2019 and applies to services and supplies provided on or after January 1, 2020.

I.  Balance Billing and SB 1264

The term “balance billing” refers to when a healthcare provider bills a patient for the difference between the reimbursement provided by the patient’s health insurance and the amount charged by the provider. SB 1264 places restrictions on balance billing by out-of-network (OON) providers of emergency services, facility-based services provided at an in-network healthcare facility, and lab and diagnostic imaging services that are related to an in-network service. The law disallows these providers from billing a patient for an amount greater than the applicable copayment, coinsurance, and deductible under the health plan based on the initial amount determined to be payable by the plan, or if applicable, a modified amount determined under the plan’s appeal process. Continue Reading SB 1264 Restricts Certain Providers from Balance Billing in Texas

On June 1, 2019, the United States Pharmacopeia (“USP”) published the final revisions to its pharmaceutical sterile compounding standards (“chapter <797>”).  Chapter <797> sets forth standards for the preparation of compounded sterile medications to help ensure products are safe and effective and reduce risks such as contamination or incorrect dosing. The most recent revisions implement new standards and revise existing ones based on recent scientific and technological developments. The chapter <797> revisions also incorporate stakeholder input raised during the July 2018 to November 2018 public comment period, much of which concerned allergens, beyond-use dating, and the general ambiguity throughout the chapter.

The USP’s most recent revisions to chapter <797> are extensive and those who prepare compounded sterile products (“CSPs”) are advised to familiarize themselves with the new standards. Significant changes include: Continue Reading USP Finalizes Revisions to Sterile Compounding Standards