The Supreme Court Upholds The Availability Of Subsidies On The Federal Exchange—Where Do We Go From Here?

One of the most highly anticipated decisions of the term—at least among the Sheppard Mullin Healthcare team—was issued today by the Supreme Court: King v. Burwell.[1]   Six of the justices, including Chief Justice Roberts, voted to uphold the Administration’s interpretation of the law, leaving the availability of tax credits to people insured on the federal exchange and the current status quo in place.

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Thirteen Years of the Same Rules and Now Big Proposed Changes to the Regulation of Medicaid Managed Care Plans

On June 1, 2015, the Centers for Medicare and Medicaid Services (“CMS”) published a newly proposed rule that would change the way the agency regulates Medicaid managed care plans, the first regulation of its kind since 2002.  The proposed rule seeks to address issues related to the healthcare experience of Medicaid and Children’s Health Insurance Program beneficiaries, including quality of care and program administration, as well as improve program integrity, efficiency, and alignment.  Specifically, the following areas are covered by the proposed rule: Continue Reading

Proposed Managed Care Rules Leave State Obligations for CHIP Largely Unchanged

The Centers for Medicare & Medicaid Services’ (CMS) proposed rule (“Rule”) that updates Medicaid managed care regulations to reflect changes in the usage of managed care delivery systems, leaves state obligations largely unchanged for the Children’s Health Insurance Program (“CHIP”).[1] Published on June 1, 2015, the proposed rule would codify statute and guidance that has applied to CHIP since 2009, as implemented by State Health Official (“SHO”) letters released in 2009. Continue Reading

There Is Potential Federal Inconsistency Over ACOs

On June 4, 2015, the Centers for Medicare & Medicaid Services issued final revisions to regulations governing accountable care organizations participating in the Medicare Shared Savings Program (“MSSP”). Among them is one explicitly requiring the formation of an ACO as a formal, separate legal entity for governance purposes whenever there are two or more ACO participants with unique tax identification numbers.[1] In its revised state, CMS’ requirement now appears to be at odds with certain positions taken by the Federal Trade Commission and U.S. Department of Justice.

Click here to read the full article originally published by Law360.

CMS Seeks to Boost ACO Participation Through New Final Rule for MSSP

In line with its earlier announcement to tie increasing percentages of Medicare payments to quality and value through alternative payment models by 2018, the Centers for Medicare and Medicaid (CMS) released its final rule updating the Medicare Shared Savings Program (MSSP) and provisions relating to the payment of Accountable Care Organizations (ACOs) on June 4, 2015. CMS noted that the final rule is designed to provide additional flexibility in the MSSP and “grow participation” in the ACO alternative payment model. As CMS chief medical officer Dr. Patrick Conway noted, “Shifting from fee-for-service to accountable-care models takes time…a long-term transition [that] can certainly take more than three years. We’re really trying to meet providers where they are.” Continue Reading

State Regulatory Scheme Offering Antitrust Immunity to Healthcare Collaborations Creates Tension Between Federal and State Antitrust Enforcement

On April 22, 2015, the Federal Trade Commission submitted a public letter to the New York State Department of Health (DOH) expressing “strong concerns” over state regulations offering to provide antitrust immunity to certain healthcare collaborations undertaken with DOH’s approval and supervision.  This letter is consistent with the FTC’s continued opposition to grants of immunity from federal antitrust laws based on state action.  The letter also presents a meaningful opportunity to re-evaluate the interplay between state and federal antitrust enforcement authority, and the related doctrine of state action immunity, particularly in the healthcare arena which has seen an unprecedented spike in collaborative arrangements following passage of the Affordable Care Act. Continue Reading

State Oversight of Anticompetitive Activity in Healthcare: Is a New Wave Ahead?

The Massachusetts Attorney General and others are currently advocating for legislation that would accord greater legal weight to the findings of an independent state agency, the Health Policy Commission, on the effects of proposed mergers and acquisitions.[1]  Currently, a “Cost and Market Impact Review” report is referred to the Attorney General’s Office if the Health Policy Commission determines that a transaction will likely result in a provider gaining a dominant market share, higher prices for services and increased medical spending. Under the legislation, such a report would be prima facie evidence that a transaction violates the Massachusetts Consumer Protection Act and could be used in an action brought by the Attorney General to block the transaction pending the outcome of litigation. Continue Reading

Congress Repeals Sustainable Growth Rate Formula and Advances Medicare Payment for Quality

On April 14, 2015, Congress ended over a decade of repeated “doc fixes” which temporarily suspended scheduled Medicare provider reimbursement cuts, by passing the Medicare Access and CHIP Reauthorization Act (the “Act”).  If signed by President Obama, the Act would permanently end the Centers for Medicare & Medicaid Services’ (“CMS”) use of the physician payment formula known as the “Sustainable Growth Rate” (“SGR”). Without the approval of the Act, or the passage of a doc fix, providers would have seen Medicare reimbursement rates drop by 21 percent starting on April 15, 2015. Continue Reading

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