California became the first state to set limits on how long HMO patients must wait to see a physician when the California Department of Managed Health Care (“DMHC”) adopted certain “timely access” regulations in 2010, based upon a 2002 law. These regulations require health plans to maintain provider networks sufficient to ensure that consumers can get appointments and services, such as interpreter support, within specified timeframes. For example, members must be able to obtain an appointment for a non-urgent primary care provider appointment within 10 business days. Plans are required to monitor their own networks and submit annual reports.
In our prior blog post, we reported that, at the request of the federal Department of Justice, the FCA qui tam whistleblower lawsuit in the case of United States ex rel Benjamin Poehling v. United HealthGroup, Inc., et. al. was unsealed on February 15, 2017. The complaint alleges that United HealthGroup, as well as a number of other defendants, had fraudulently collected “hundreds of millions—and likely billions—of dollars” in Medicare Advantage risk payments by claiming patients were sicker than they really were. At the time of the unsealing, the Department of Justice partially intervened in the lawsuit against only two of the defendants – UnitedHealth Group and WellMed Medical Management, Inc. – and declined to intervene against the other defendants.
The ability of hospitals to use meal period waivers was called into question by a 2015 Court of Appeal decision in Gerard v. Orange Coast Memorial Medical Center (Gerard I), which held that the provision in Wage Order 5 allowing waivers even when employees work over 12 hours was invalid. Following two more years of litigation, we can now inform you that the three-member panel that reached the 2015 decision in Gerard I, reversed itself on March 1, 2017 in Gerard II. In its new opinion, the Court of Appeal adopted Sheppard Mullin’s argument and confirmed that the special meal period rules for health care employees in Wage Order 5 are, in fact, valid.
The antitrust injury and antitrust standing defenses/doctrines are alive and well in healthcare. A recent case, SCPH Legacy Corp. et al. v. Palmetto Health et al., shows that a competitor is not always the most legally appropriate plaintiff to bring an antitrust case, especially when the competitor’s alleged harm stems from increased competition. This article explains the court’s reasoning and makes some predictions for similar arguments in the future.
In Part IV of our blog series, Very Opaque to Slightly Transparent: Shedding Light on the Future of Healthcare, we discussed a few post-inauguration developments with respect to the Affordable Care Act (ACA). In this Part V, we provide a brief overview of some of the key provisions of the American Health Care Act (AHCA), the latest in the ongoing saga of the ACA’s future.
On March 6, 2017, Speaker of the House Paul Ryan unveiled his much anticipated ACA “repeal and replace” bill, the AHCA. Although it is currently undergoing markup in the House of Representatives, and thus is subject to change even in the immediate future, it is worth considering some of the legislation’s core features, as they establish a general framework within which a successful repeal and replace effort may operate. For example, in its current draft form, the AHCA includes various key components, including those set forth in the following abridged list:
On January 12, 2017, just a week prior to President Trump’s Inauguration, the Department of Health and Human Service (HHS) Office of Inspector General (OIG) published a final Rule (Rule) regarding one of its most important enforcement mechanisms: its exclusion authority. The Rule, published nearly three years after it was initially proposed by the OIG back in May 2014, expands the OIG’s authority to exclude individuals and entities participation in federal healthcare programs and codifies certain provisions of the Affordable Care Act (ACA). The Rule’s original effective date was February 13, 2017, but due to the Trump Administration’s administrative freeze on the effective date of regulations that had not yet gone as of January 20, 2017, the Rule’s effective date is now set for March 21, 2017.
On February 8th, the U.S. Department of Justice (DOJ) quietly issued new guidance on how the agency evaluates corporate compliance programs during fraud investigations. The guidance, published on the agency’s website as the “Evaluation of Corporate Compliance Programs,” lists 119 “sample questions” that the DOJ’s Fraud Section has frequently found relevant in determining whether to bring charges or negotiate plea and other agreements. The February 8th issuance is the agency’s first formal guidance under the new presidential administration, and the latest effort by the DOJ’s “compliance initiative,” which launched at the hiring of compliance counsel expert Hui Chen in November 2015. The new guidance is particularly valuable for healthcare organizations in light of the agency’s heightened efforts to prosecute Medicare Advantage plans for fraudulent reporting under the False Claims Act.
On February 16, 2017, Representative Sam Johnson (R-Texas) introduced a bill to the House of Representatives that brings to the forefront an ongoing and contentious debate regarding the propriety of physician-owned hospitals. If adopted as proposed, the Patient Access to Higher Quality Health Care Act of 2017 would repeal sections of the Affordable Care Act (“ACA”) that, since 2011, have effectively prevented new physician-owned hospitals from participating in the Medicare program.
The U.S. Department of Justice (DOJ) has joined a whistleblower lawsuit, United States of America ex rel Benjamin Poehling v. Unitedhealth Group Inc., No. 16-08697 (Cent. Dist. Cal. Sep. 17, 2010), ECF No. 79, against UnitedHealth Group (United) and its subsidiary, UnitedHealthcare Medicare & Retirement—the nation’s largest provider of Medicare Advantage (MA) plans. The suit accuses United of operating an “up-coding” scheme to receive higher payments under MA’s risk adjustment program called the HCC-RAF Program (see below). The complaint alleges that United fraudulently collected “hundreds of millions—and likely billions—of dollars” by claiming patients were sicker than they really were. The suit was originally filed in 2011 by a former United finance director under the False Claims Act (FCA), which allows private citizens to sue those that commit fraud against government programs. Pursuant to the FCA, the case was sealed for five years while the DOJ investigated the claims.
On January 30, 2017, the proposed 340B Drug Pricing Program (the “340B Program”) Omnibus Guidance (the “Guidance”) first issued by the Health Resources and Services Administration (HRSA) in August of 2015 was withdrawn from the Office of Management and Budget (OMB) review process. It is widely believed that the “cause of death” for the Guidance was the Trump Administration’s January 20, 2017 Memorandum (the “Memorandum”) directing agencies to immediately withdraw all unpublished regulations pending before OMB.