Hospitals & Health Systems

The National Labor Relations Board (the “Board”) recently held that a California hospital illegally maintained a dress code policy that effectively prohibited employees from wearing pins and badge reels with union insignia.  The hospital’s policy at issue required that “[o]nly [employer] approved pins, badges, and professional certifications may be worn.” In addition, employees were only permitted to wear identification badge reels with “approved logos or text.”
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The debate over providing transportation to patients is nothing new. Hospitals, doctors and other providers have long struggled with whether they can provide free or discounted taxis, shuttles, metro cards or other transportation means to patients to come to appointments and receive care. On one hand, there is evidence that without reliable transportation options, patients are more likely to miss preventative, primary care appointments, increasing the risk of more costly and unnecessary medical services down the road. On the other hand, certain federal laws like the Anti-Kickback Statute (AKS) and Civil Monetary Penalty (CMP) law have given providers serious concerns that such transportation services might be considered an illegal “kickback” to gain patients, or an illegal inducement to receive care.
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With the New Year underway, the deadline is quickly approaching for HIPAA covered entities to file their annual breach reports with the U.S. Department of Health & Human Services Office for Civil Rights (“OCR”).

While breaches involving 500 or more individuals must be reported no later than 60 calendar days from the date of discovery,

The National Labor Relations Board (“NLRB”) recently adopted a new and employer welcomed standard for determining whether facially neutral workplace rules unlawfully interfere with the exercise of employee rights that may be protected by the National Labor Relations Act (“NLRA”).

Going forward, the NLRB will consider the following factors:

  • the nature and extent of the potential impact on NLRA rights, and
  • legitimate justifications associated with the rule.


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On November 2, 2017, the House Ways and Means Committee released draft text of H.R. 1, the Tax Cuts and Jobs Act, proposing significant changes to the Internal Revenue Code. Of particular concern to private hospitals, healthcare systems and educational institutions operating as 501(c)(3) entities is the bill’s proposed termination of the tax exemption available

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).  
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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.

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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

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