Consistent with the Biden Administration’s whole-of-government approach to address perceived consolidation in a variety of industries, including in the healthcare industry, the Federal Trade Commission (FTC) and U.S. Department of Justice (DOJ) Antitrust Division (collectively, the Agencies) are continuing to make good on their promise to increase scrutiny of mergers and acquisitions through newly proposed HSR rules and revised merger guidelines.

On July 31, 2023, the California Office of Health Care Affordability (“OHCA”) released draft regulations concerning pre-transaction review of so-called “Material Change Transactions” as part of its legislative mandate to review transactions which could have potential impacts on the costs of health care in the State of California.  When approved, final regulations would be effective January 1, 2024. The draft regulations contemplate a dramatic expansion of state review of transactions affecting health care services.  The draft regulations are to be discussed at a public regulatory workshop to be convened by OHCA on August 15, 2023, at its Sacramento offices. OHCA will accept public comments on the draft regulations through August 31, 2023, submitted to CMIR@HCAI.CA.GOV.

The Supreme Court issued a number of headline-grabbing decisions this term on topics like religious accommodation, LGBTQ protections, and consideration of race in college admissions. These decisions are wide-reaching and impact individuals, employers, and higher education institutions. Though not nearly as wide-reaching, the Supreme Court also issued two important decisions this year dealing with the False Claims Act (FCA) that could have dramatic impact nonetheless for those ensnared in an FCA action.

On June 23, 2023 the U.S. Food and Drug Administration (FDA) published a draft guidance document with foundational considerations for researchers that are developing psychedelic drugs for the treatment of medical conditions. The guidance document applies to clinical trials that will be conducted under investigational new drug applications, including clinical trials that are not intended to support marketing applications. Notably, the use of the term “psychedelic” in the guidance document is intended to encompass “classic psychedelics” that are understood to be 5-HT2 agonists (e.g., psilocybin and lysergic acid diethylamide (LSD)) as well as entactogens or empathogens (e.g., methylenedioxymethamphetamine (MDMA)). This is the first FDA draft guidance that discusses designing clinical trials for psychedelic drugs.

On June 14, 2023, a federal jury found that a Georgia physician knowingly violated the False Claims Act following a two-week trial on allegations that he made false claims to the Medicare Program. Now, despite just $1.1 million in improper payments stemming from false claims, a federal court is likely to impose a judgment that exceeds $27 million after adding statutory per-claim penalties and trebling the amount determined by the jury to be false.

Following two weeks of trial testimony, a Travis County jury recently rendered a $10 million verdict in a novel corporate practice of medicine (CPOM) case. The jury found in favor of a physician hospitalist group that claimed a management company repeatedly broke its promise to comply with the state’s CPOM prohibition, putting profits over patients, among other wrongdoings.

The Department of Health and Human Services (HHS) through its Office of Inspector General (OIG), announced plans for significant updates and modernization of OIG compliance program guidance (CPG) to improve their accessibility and usability for healthcare entities.[1] Originally issued in 1998, the CPG provide healthcare organizations across the industry with guidance on developing, implementing, and maintaining internal compliance controls. In the 25 years since, the OIG has issued multiple and specific CPGs that apply to particular segments of the healthcare industry including Medicare Advantage organizations, hospitals, home health agencies, nursing homes, and clinical laboratories. However, over time the CPGs have not sufficiently kept up with the innovations and growth of the healthcare industry.

Cosmetic surgeries are on the rise. One study of cosmetic surgery data found that body procedures like tummy tucks, buttock augmentation, and liposuction increased by 63 percent from 2020 to 2021.[1] Facelifts were up 54 percent.[2] And breast procedures were up 48 percent.[3] According to that study, Americans spent over $14.6 billion on aesthetic procedures in 2021 with surgical revenues increasing by 63 percent.[4]