On December 28, 2023, the Office of Inspector General (the “OIG”) issued a favorable Advisory Opinion (No. 23-15) (the “Opinion”) to a consulting vendor (the “Requestor”) that wanted to provide up to $75 in gift cards to physician practices in exchange for referring the Requestor’s practice optimization services (e.g., workflow and performance assessment, data analytics, and certain Medicare eligibility and performance assistance). Among other things, the Requestor: (i) did not itself provide any services that were eligible for reimbursement under any Federal healthcare program to any of its clients, (ii) did not have an ownership or investment interest in any entity that provided items or services paid for by any Federal healthcare program, and (iii) received compensation from the physician practices that did not vary based on whether the physician practices received a greater or lesser reimbursement from Medicare based on the Requestor’s services. The Opinion concluded that this proposed arrangement would not generate prohibited remuneration under Section 1128B(b) of the Social Security Act (the “Act”), also known as the Federal Anti-Kickback Statute (“Anti-Kickback Statute”), and thus OIG would not impose administrative sanctions under Section 1128A(a)(7) (exclusion) or Section 1128(b)(7) (civil monetary penalty) of the Act on the Requestor. As always, the Opinion stipulated that it may only be relied on by the Requestor on the specific facts presented to OIG, and that certain state and federal laws may continue to limit similar arrangements. However, the Opinion indicates that the tight scope of potential marketing options for physician practice vendors could expand a bit for those who are similarly situated to the Requestor.Continue Reading New Marketing Possibilities for Vendors Contracted with Medicare Providers and Suppliers Following OIG’s Favorable Advisory Opinion on Limited Referral Bonuses
Ariana Stobaugh is an associate in the Corporate Practice Group in the firm's Century City office and is a member of the firm’s Healthcare team.
As the nation prepares for the upcoming 2024 elections, the consequences of the U.S. Supreme Court’s ruling in Dobbs v. Jackson continues to be a significant topic of discussion in numerous states. Since that decision and our first and second posts in this series, a number of noteworthy developments* have occurred at both the federal and state levels, including some states passing laws that prohibit or restrict the availability of abortions. Some of the most recent legal developments are summarized below. Continue Reading Part 3: An Update on the Federal and State E-Roe-sion or P-Roe-tection of Abortion Rights
As an update to our previous post, on Monday, May 15, 2023, California Governor Gavin Newsom signed into law Assembly Bill 112 (“AB 112”), which is designed to provide…Continue Reading Update to: A Lifeline Amidst Turbulent Times: California Lawmakers Approve Emergency Loans for Struggling Hospitals
Summary: California lawmakers have greenlighted emergency loans to support struggling hospitals facing financial challenges across the state. These loans will serve as a critical lifeline, helping eligible hospitals stabilize operations and navigate through turbulent times. Assembly Bill 112, passed by the California Senate and Assembly and expected to be signed by California Governor Gavin Newsom, establishes the Distressed Hospital Loan Program and the Distressed Hospital Loan Program Fund, which are designed to provide interest-free cashflow loans to not-for-profit hospitals, public hospitals in significant financial distress, and governmental entities representing a closed hospital (i.e., a hospital that closed after January 1, 2022). Understanding the qualifications and limitations outlined in the proposed legislation, including loan repayment terms and loan forgiveness options, is crucial for potential hospital participants.Continue Reading A Lifeline Amidst Turbulent Times: California Lawmakers Approve Emergency Loans for Struggling Hospitals
In light of the increasing demand for mental health treatment and simultaneous provider shortages, the private insurance industry is rolling out targeted initiatives to increase mental health support for members by mitigating many of the barriers to entry facing the mental health industry today.Continue Reading Payor-Led Initiatives to Strengthen Mental Health Resources
On October 20, 2021, the Centers for Medicare and Medicaid (“CMS”) Innovation Center (“Innovation Center”) published a white paper detailing its vision for the next ten years: a health system that achieves equitable outcomes through high quality, affordable, person-centered care. The white paper first recounts the last ten years of testing and learning that laid the foundation for the Innovation Center’s future strategy. The future strategy is organized around five strategic objectives that will guide the Innovation’s Center’s models and priorities for the next ten years. The five strategic objectives for advancing this systemwide transformation include (1) Drive Accountable Care, (2) Advance Health Equity, (3) Support Innovation, (4) Address Affordability, and (5) Partner to Achieve System Transformation. These strategic objectives aim to guide the Innovation Center’s models which will seek to reduce program costs and improve quality and outcomes for Medicare and Medicaid beneficiaries. Finally, the white paper emphasizes its approach to measuring the progress of each of these objectives and assessing the impact the objectives have on beneficiaries, providers, and the market as a whole.
Continue Reading Centers for Medicare and Medicaid Innovation Center: Equity and Vision
On October 4, 2021, California Governor Gavin Newsom signed California bill SB-664 “Hospice licensure: moratorium on new licenses” (the “Bill”) into law. The Bill, which passed the California Assembly on September 8, 2021 and the California Senate on September 9, 2021, imposes a moratorium on the California Department of Public Health (the “Department”) issuing new hospice licenses on or after January 1, 2022. Under the California Hospice Licensure Act of 1990, a person, political subdivision of the state, or other governmental agency must obtain a license from the Department to provide hospice services to an individual who is experiencing the last phase of life due to a terminal disease. The moratorium will end either three hundred and sixty five (365) days from the date the California State Auditor publishes a report on hospice licensure or when the provisions of the Bill are repealed on January 1, 2027, whichever is sooner. The Department may grant an exception to the moratorium upon making a written finding that an applicant for a new license, or with a license application pending on January 1, 2022, has shown a ‘demonstrable need’ for hospice services in the area. However, the Bill does not affect the Department’s ability to renew existing licenses.
Continue Reading New California Law Imposes Moratorium on New Hospice Licenses
On August 10, 2021, the Senate passed H.R. 3684, a roughly $1 trillion infrastructure bill (the “Infrastructure Bill”) that authorizes funds for federal-aid highways, transit, broadband access and other infrastructure purposes. Notably, the Infrastructure Bill is paid for in part through changes to several healthcare policies, including delaying a Medicare Part D rebate rule for an additional three years and reducing Medicare payment amounts to providers. The Infrastructure Bill’s changes to healthcare policies provide a mixed impact to health care industry stakeholders, with both expected benefits and burdens to providers, payers, and drug manufacturers.
Continue Reading The Infrastructure Investment and Jobs Act: Potential Impact on Healthcare Policy and Spending
On August 10, 2021, the Centers for Medicare and Medicaid (“CMS”) published a proposed rule (“Proposed Rule”) to rescind the Most Favored Nation Model (“MFN Model”) interim final rule that was published on November 26, 2020 (“Interim Final Rule”). As described in our December 2020 blog post, the Interim Final Rule established a seven-year nationwide, mandatory MFN Model that would test an alternative way for Medicare to pay for certain Medicare Part B single source drugs and biologicals. The MFN Model, originally set to begin January 1, 2021, would have tied the prices for certain Part B single-source drugs and biologics to the average price paid by several overseas countries and remove incentives to use higher cost drugs, in order to determine whether this could “control unsustainable growth in Medicare Part B spending without adversely affecting quality of care for beneficiaries.” Had the Interim Final Rule been implemented, Medicare Part B reimbursement would have been significantly reduced starting January 1, 2021.
Continue Reading Executive Order on Promoting Competition in the American Economy: The Biden Administration Considers Drug Pricing Strategies While Keeping the “Most Favored Nations” Drug Reimbursement Program on the Sidelines
On May 6, 2021, the comment period for the proposed modification to regulations implementing the Health Insurance Portability and Accountability Act of 1996 (“HIPAA”) Privacy Rule and Health Information Technology for Economic and Clinical Health Act of 2009 (“HITECH”) closed. The Office for Civil Rights (“OCR”) at the Department of Health and Human Services (“HHS”) issued its initial request for information in December 2018, subsequently released the Notice of Proposed Rulemaking (“NPRM”) to the public on December 10, 2020, and published the Proposed Rule in the Federal Register on January 21, 2021 (the “Proposed Rule”). After a significant degree of public interest in providing input on the proposals, OCR extended the comment period from its original end date of March 22, 2021 to May 6, 2021.
Continue Reading HIPAA Privacy Rule Modification – Removing Barriers and Promoting Coordinated Care at What Cost?
The Biden Administration’s American Rescue Plan Act of 2021 (H.R. 1319) (the “Act”) could present an opportunity for the growth of utilization of ambulatory surgery centers (“ASCs”), continuing the trend of migration of inpatient procedures to the outpatient setting. This shift toward the outpatient setting initially began prior to the COVID-19 public health emergency, but was accelerated by the pandemic’s effect on hospitals, likely continuing the substantial increase in investment in the ASC marketplace.
Continue Reading Biden’s American Rescue Plan Follows Trend Toward Outpatient Setting, Increase in ASC Investment