HHS Launches New Payment and Delivery Model to Improve Oncology Care

Cancer care is notoriously complex, intensive and costly. With more than 1.6 million people diagnosed with cancer each year, there is a strong impetus towards reforming service delivery. Accordingly, the U.S. Department of Health and Human Services is launching a new payment and care delivery model for Medicare beneficiaries undergoing chemotherapy treatment.[1] Continue Reading

Go For De Novo: FDA’s Revised Approach to Medical Device Accessories

Accessories are an everyday reality for almost all users of technology products today.  They can help improve efficacy, increase usability and make many other improvements to the technology we use.  Increasingly, accessories are used for health related applications (e.g., smartwatches that connect to glucose meters).  In the healthcare space, accessories can potentially face regulation by the Food and Drug Administration (FDA) if they are intended to support, supplement, and/or augment the performance of one or more regulated parent devices, but there has been a lack of clarity from the FDA on what types of accessories will be regulated.  In January 2015, the FDA released guidance[1] to address concerns from the medical device industry and more recently the health information technology industry on the following topics. Continue Reading

In Highly-Anticipated Decision, Ninth Circuit Affirms That Hospital-Physician Group Merger in St. Luke’s Violated Section 7 and Casts Serious Doubt on Viability of Efficiencies Defense

On February 10, 2015, the Ninth Circuit issued its highly-anticipated decision at the intersection of health care and antitrust, affirming the lower court’s finding that a hospital-physician group merger completed nearly three years ago violated Section 7 of the Clayton Act.  St. Alphonsus Med. Ctr. – Nampa Inc. v. St. Luke’s Health Sys., Ltd., No. 14-35173 (9th Cir. Feb. 10, 2015) (“St. Luke’s”).  The significance of St. Luke’s cannot be overstated.  It is the first challenge of a hospital-physician group merger by the Federal Trade Commission which proceeded to trial.  The Ninth Circuit’s opinion includes significant judicial guidance for future health care mergers, casting serious doubt on the viability of a “post-merger efficiencies defense” to a prima facie case of a Section 7 violation and declaring that proof of “extraordinary efficiencies” which are “merger-specific” is required in order to successfully offset anticompetitive concerns in highly concentrated markets.

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Interface without Regulation – FDA Deregulates MDDS and Related Technologies

2015 has been a busy year for the Food and Drug Administration (FDA).  In January, the FDA issued guidance documents addressing wellness applications[1] as well as accessories to medical devices and it looks like the administration is continuing the trend into February with a finalized regulatory approach to Medical Device Data Systems (MDDS)[2].  All three of these documents seemed to trace a common line of promoting health information technology (HealthIT) innovation and demonstrate the prevalence the field has had into the FDA’s thinking.  Before addressing the applicability to HealthIT, we briefly examine the impact the current guidance has on MDDS regulation.

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New Venture Seeks to Support Independent Physicians in Texas

The Texas Medical Association (TMA) and Blue Cross Blue Shield of Texas are launching a new services company, TMA PracticeEdge, to facilitate bringing the benefits of value-based reimbursements to the state’s independent physicians.

Independent practitioners face challenges to participating in (and benefitting from) alternatives to fee-for-service payment, such as having the funds necessary to invest upfront in resources for improved care management. TMA PracticeEdge aims to help providers address the barriers. The company, for example, will offer consultations on basic practice management and administrative simplification, assistance with the implementation of health information technology infrastructure, and experience with risk-based contracts. Additional services will be available for practices interested in creating care teams or developing an Accountable Care Organization.

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Task Force of Healthcare Providers and Insurers are Shifting to Incentive Based Contracts

Some of the largest healthcare providers and insurers in the country have joined to form the Healthcare Transformation Task Force in an effort to change healthcare industry payment models.  The announcement of the task force and its efforts come shortly after the Department of Health and Human Services announced plans to overhaul Medicare’s fee-for-service program and transfer non-managed care spending to contracts that incentivize quality performance and cost control.  A unified vision of shifting to incentive based contracts has brought together health systems, Ascension, Trinity Health, Partners HealthCare, and Advocate Health Care, insurance titans Aetna and Health Care Service Corp., and Caesars Entertainment and the Pacific Business Group on Health to form the Healthcare Transformation Task Force.  The goal of the task force is to transform 75% of their business contracts to incentive based contracts focused on improving healthcare quality and lowering healthcare costs.

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Medicare Hospital Compliance Reviews are Legal and Sound, According to OIG

The Office of Inspector General for the Department of Health and Human Services (OIG) recently defended its practices pertaining to hospital compliance reviews in a published response to a letter from the American Hospital Association (AHA), while simultaneously announcing a voluntary suspension of reviews of inpatient short stay claims after October 1, 2013.[1]
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HHS Aims to Tie Most Medicare Reimbursements to Quality by 2018

On January 26, 2015, Health and Human Services (HHS) Secretary Sylvia M. Burwell announced specific goals and a timeline for shifting Medicare reimbursements from the traditional fee-for-service (FFS) model, to a quality or value-based model.[1] This is the first time in Medicare’s history that HHS is setting specific goals for such a shift. Secretary Burwell noted that by moving towards a reimbursement model that rewards quality of care, rather than simply paying for each individual service without evaluating the outcome of such services, that the goals of building a health care system that delivers better care, spends health care dollars more wisely and results in healthier Americans will be realized.

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Indiana Wins Federal Approval to Expand Medicaid Coverage Under Obamacare

Republican Indiana Gov. Mike Pence announced on Tuesday that an agreement had been reached on the state’s Medicaid expansion proposal submitted in July. As many as 350,000 people could gain coverage under the federal health law after a key concession from the Obama administration was made. The deal could lead to half a dozen more states advancing similar Medicaid expansion proposals in Republican-led states including Florida, North Carolina and Wyoming.

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FDA Issues Guidance for Low-Risk General Wellness Products

On January 20, 2015, the FDA issued draft guidelines[1] designed to give developers whose products and applications promote healthy lifestyles (so-called “general wellness products”) direction on when such products qualify as medical devices under Section 201(h) of the Food Drug & Cosmetics Act (the “Act”) and are therefore subject to the Act’s regulatory requirements for devices.

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