Players in the healthcare industry continue to identify ways to use technological innovations to decrease overhead expenditures and increase bottom lines.  AI software to automatize EHR documentation in place of human input, mobile apps and portals to grant patients immediate access to their medical records, and blockchain technology to accelerate claims adjudication are some examples. In particular, commercial health insurers have employed various cost containment measures to minimize non-claim expenses. One measure involves the use of virtual credit cards, or VCCs, in lieu of traditional payment methods to reimburse providers for services rendered to plan enrollees. A VCC is linked to the payer source’s credit card account but generates a new 16-digit single-use number each time the physical card’s 16-digit number is used. Payers send providers the number with instructions to access and process these payments electronically. Continue Reading Recent State Laws Restrict Payer-to-Provider Reimbursement via Virtual Credit Cards

In this short recording, Healthcare attorneys Wakaba Tessier and Erica Ash discuss a recent Department of Justice (DOJ) settlement involving a specialty pharmacy and its private equity owner. This case is significant because – not only did the DOJ name the compounding pharmacy and its two executives – but it also named the private equity firm that owned the pharmacy as defendants in an Anti-Kickback and False Claims action. This recorded webinar provides an in-depth look at the case United States of America et al. v. Diabetic Care Rx, LLC et al. and develop key takeaways for viewers. Please click the link to view recording: https://youtu.be/yu34RL_UjYI

 

The Centers for Medicare and Medicaid Services (CMS) recently issued a final rule that includes several anti-fraud measures and significantly enhances the agency’s authority to exclude new and current providers and suppliers that are identified as posing an undue risk of fraud, waste or abuse. The new measures require providers and suppliers to disclose to CMS upon its request and upon application for initial enrollment or revalidation any “affiliations” or parties who have one or more defined “disclosable events.” The rule went into effect November 4, 2019.

The new rule requires all providers to disclose any current or prior affiliations within the past five years that the provider—or any of its owning or managing employees or organizations—has or had with a current or former Medicare provider with a “disclosable event,” which is triggered by any of the following:

  • an uncollected debt to CMS
  • current or previous payments suspension from a federal health care program
  • current or previously exclusion from healthcare programs
  • previous denial, revocation or termination of Medicare, Medicaid or CHIP billing privileges

Continue Reading New CMS Disclosure Rule Implemented

Update on 12.9.19: On December 4th, 2019, the governor of Illinois signed into law an amendment to the Act allowing employer action based on drug testing  when the testing is part of a reasonable, non-discriminatory drug policy, including any pre-employment testing policies. We will discuss the Act and implications of the amendment as well as the other evolving cannabis legal issues for healthcare employers and educators in our December 10, 2019 webinar.

—————————————————————————————————————————

In less than two months the Illinois Cannabis Regulation and Tax Act (the “Act”) will come into effect. On January 1, 2020 the Act will legalize adult-use retail marijuana across the state and bring with it a hefty regulatory framework. As part of that framework, employers—particularly hospitals, academic medical centers and other employers subject to complex, overlapping and sometimes contradictory workplace regulations—will now be prohibited from firing employees for off-duty marijuana use, requiring an overhaul of most employers’ drug policies.

Continue Reading Deep in the Weeds: Hidden Employment Issues in Illinois’ New Retail Marijuana Law

This is the third and final blog in our Surprise Billing series. Our first two blogs addressed legislation in Texas and California limiting “surprise” or “balance” billing. This article will briefly touch on surprise billing legislation that other states across the nation have implemented, and also look at proposed federal legislation that mirrors those state laws.

In today’s political climate, it is rare to have both sides of the aisle agree on the need to tackle a pressing issue. But leaders from both parties see eye-to-eye when it comes to ending surprise medical billing, a problem that arises in roughly 1 in 5 emergency department visits. However, agreeing that something needs to be fixed is only the first step—agreeing on how to fix it is another, much more difficult, issue. There have been proposals, from both the House and the Senate, with bipartisan support that are based on existing state legislation. Congressional legislation regarding surprise billing is imperative for many Americans, because state legislation does not protect patients enrolled in self-insured employer health plans due to preemption by the Employee Retirement Income Security Act (ERISA). Continue Reading Proposed Federal Legislation Mirrors State’s Attempts to End Surprise Billing

Part V: Material Deal Terms to Negotiate in Private Equity Transactions

This is the fifth 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. In Part III, we walked through what to expect during the due diligence process. In Part IV, we outlined the various healthcare regulatory issues that arise in private equity transactions. Here, we highlight some of the more material terms typically negotiated in the definitive transaction documents.

The primary definitive document will be the purchase agreement (which will either be an asset purchase agreement or a stock purchase agreement, depending on the structure of the transaction). The first step will be to confirm the agreement contains the various terms negotiated in the letter of intent. (See Part II for a discussion of the terms that should be negotiated.) While the LOI will cover the major deal terms, the purchase agreement will expand upon those terms in more detail, and include other provisions necessary to effectuate the transaction. Continue Reading Ultimate Guide to Closing a Private Equity Transaction

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