CY 2018 Medicare Advantage Final Call Letter

Sheppard Mullin continues to see a lot of interest in the Medicare Advantage (MA) marketplace from our managed care payor clients, as well as our health system clients, many of whom are well-positioned to enter this space as provider sponsored health plans. Continue Reading

A $31,000 Mistake: Failing To Manage Business Associate Agreements Proves Costly For Providers

The Center for Children’s Digestive Health (CCDH), a small, for-profit pediatric subspecialty practice that operates seven clinics in the Chicago area, has paid the U.S. Department of Health and Human Services, Office for Civil Rights (OCR) $31,000 to settle potential violations of the Health Insurance Portability and Accountability Act of 1996 (HIPAA). Continue Reading

Final Market Stabilization Rules – How Stable is Stable?

The Department of Health and Human Services released the final Affordable Care Act marketplace stabilization rules (“Final Rule”) on April 13, 2017. The Final Rules become effective on June 19, 2017 and will, accordingly, apply to the 2018 state and federal Affordable Care Act health insurance exchanges. The Final Rule is available here. Continue Reading

Patient Check-Ups Before Checking Out: Partnering to Bring Health Care into the “One-Stop Shopping” Sector

Retail clinics—the popular term for walk-in clinics located in pharmacies, supermarkets, and “big-box” stores—are playing an expanding role in the health care market. According to a study published by the New England Journal of Medicine, over 2,000 retail clinics were operating in the U.S. as of 2015.[1] Major players, such as CVS Health’s MinuteClinic, Walgreens’ Healthcare Clinics, and Kroger’s Little Clinic, are continuing to grow and adapt their strategy. Continue Reading

Jury Returns Massive Verdict in Hospital Gown Fraud Lawsuit

On Friday, April 8, 2017, a federal jury in California sent shockwaves throughout the healthcare and legal community when it returned a $454 million verdict against Kimberly-Clark Corp. and its affiliate Halyard Health Inc. (together, “Kimberly-Clark”) in a case involving the sale of Kimberly-Clark’s MicroCool Breathable High Performance surgical gowns. The verdict is believed to be one of the largest in U.S. history in the medical device space. Continue Reading

New York AG Takes Enforcement Action Against Heart Monitoring Apps: Murmurs of Concern are Heard in mHealth App World

In a move sure to cause murmurs in the large and growing mobile health application industry, the Office of New York Attorney General Eric Schneiderman (OAG) has used state trade laws to extract concessions and monetary penalties from mHealth app developers, including the developer of a supposed fetal heart monitoring smartphone app.

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Merger and Acquisition Activity in the Rehabilitation, Home Health and Hospice Sectors Increased in 2016, But Will this Trend Continue?

Since 2014, there has been a steady increase in mergers and acquisitions in the Rehabilitation sector, with a total of 40 deals announced in 2016.  This is almost double the number of deals in 2014 (a total of 21), and includes deals with both publicly traded corporations as well as privately held acquirers.  Similarly, after seeing a sharp decline in M&A activity in 2015, the home health and hospice sectors saw an increase of 12% in M&A activity in 2016 with a total of 57 deals announced, including several deals involving private equity investors.

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Health-Related Programs Face Deep Cuts In President Trump’s “Budget Blueprint to Make America Great Again”

On March 16, 2017, the President Trump Administration released his first budget outline for the 2018 fiscal year (FY 2018). In an effort to “shrink the role of government,” the $1.1 trillion budget proposal calls for a $54 billion increase in defense spending, with a corresponding $54 billion reduction in funding for many federal government programs. In particular, the Department of Health and Human Services (HHS) and the National Institutes of Health (NIH) would absorb double-digit budget cuts, in addition to other consolidation efforts involving those agencies.

President Trump is expected to release a full FY 2018 budget request in May of this year. Although the budget blueprint delivers on President Trump’s campaign promise for increased homeland security and military spending, opposition from both Democratic and Republican lawmakers suggests that the proposed cuts are unlikely to fully survive the congressional appropriations process.

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CMS Delays Implementation of New Payment Models (Again)

On March 21, 2017, the Centers for Medicare and Medicaid Services (“CMS”) published an interim final rule (“Interim Final Rule”) delaying (i) the effective date of several new Medicare payment models developed by the CMS Innovation Center to advance care coordination, and (ii) the implementation of updates to an additional existing model.

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California HMO Timely Access Report Available

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.[1]  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.

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