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Jordan Grushkin is an associate in the Corporate Practice Group in the firm’s Century City office and is a member of the firm’s healthcare practice team.

Today the United States Court of Appeals for the Fifth Circuit reached its widely anticipated decision in Texas vs. Azar, ruling that the Affordable Care Act’s (ACA) individual mandate is unconstitutional as a result of the Tax Cuts and Jobs Act of 2017’s elimination of the mandate’s financial penalty. The Court has remanded the case to the District Court to further address the question (known as the “severability” question) of whether the remaining provisions of the ACA are lawful in light of the decision regarding the individual mandate.
Continue Reading JUST IN: Fifth Circuit Court of Appeals Reaches Decision on Latest Case Involving Constitutionality of ACA

As we noted in our November 1, 2019 Healthcare Law Blog post, California Attorney General Xavier Becerra rejected the proposed merger between Adventist Health System/West and St. Joseph Health System (the “Proposed Merger”) in a denial letter issued on October 31, 2019. The Proposed Merger would have created a joint operating company to manage each health system’s facilities in Humboldt, Lake, Mendocino, Napa, Solano, and Sonoma Counties. In this blog post we will be discussing the Attorney General’s review process of hospital transactions and the reasons why this particular transaction may have been rejected. Moreover, we will assess what lessons can be learned going forward for other California healthcare systems and entities undergoing mergers and acquisitions in the future.
Continue Reading Adventist – St. Joseph Merger: AG Concludes Merger is Not in the Public Interest

On October 31, 2019, the California Department of Justice (“DOJ”) issued a denial letter rejecting a proposed merger between Adventist Health System/West and St. Joseph Health System. The parties had submitted notices to the DOJ requesting approval to form a joint operating company to manage the health systems’ nine health facilities in Northern California. According to the denial letter, the proposed transaction was rejected because the Attorney General concluded that it was not in the public interest due to concerns related to the potential for higher health costs and for reduced access and availability of health care services.
Continue Reading Merger of Adventist-St. Joseph Rejected by the California Attorney General

One of the most controversial taxes of the Affordable Care Act (ACA) is in danger of repeal. The tax colloquially known as the “Cadillac Tax” was supposed to take effect in 2018, but Congress has delayed it twice. With the tax now slated to take effect in 2022, opponents of the tax have taken the opportunity to attempt to repeal it for good. On July 17, 2019, the House of Representatives overwhelming voted, 419-6, to approve the Middle Class Health Benefits Tax Repeal Act of 2019, which would abolish the Cadillac Tax. A Senate companion bill with 61 co-sponsors, including 32 Republicans and 28 Democrats, shows that the bill is unlikely to encounter much resistance if it is brought to a vote.
Continue Reading Bipartisan Push To Repeal ACA’s Cadillac Tax

On June 24, 2019, President Trump signed an executive order that purports to create a more transparent health care market for both patients and providers. The order attempts to decrease the prevalence of opaque pricing, while increasing the amount of health care data available to health care users and stakeholders alike.

The executive order lays out a series of deadlines by which regulations, proposals and recommendations must be completed that intend to generate: (i) more informed patient choices, (ii) enhanced health care analytics, and (iii) greater financial options for individual payment.
Continue Reading More Data. More Choices. Better Care? New Executive Order Relies on Market Principles to Improve American Healthcare

On May 1, 2019, the Department of Justice (“DOJ”) filed an initial brief (the “Brief”) with the U.S. Court of Appeals for the Fifth Circuit (the “Fifth Circuit”) on behalf of the United States, in favor of upholding the lower court’s decision that found the entire Patient Protection and Affordable Care Act (the “ACA”) unconstitutional.

As we discussed previously in our December 2018 blog post, a federal district court judge in Texas struck down the entire ACA by ruling that the “individual mandate,” which was reduced to $0 as part of the 2017 Tax Cuts and Jobs Act, no longer raises revenue and thus is no longer a constitutional exercise of Congress’s taxing power. The judge went on to determine that the unconstitutional individual mandate was inseverable from the rest of the ACA and therefore, the entire ACA was unconstitutional. The decision was then appealed to the Fifth Circuit.
Continue Reading Update to Texas v. United States: DOJ Files a Brief in Support of Eliminating the ACA

On December 27, 2018, the U.S. District Court for the District of Columbia issued an opinion that ruled against the Trump Administration in its plan to cut funding from the 340B Drug Pricing Program (“340B Program”).[1]

Background

As discussed in a November 17, 2018 posting on this blog, the reimbursement rates for the 340B Program were significantly reduced when the Centers for Medicare & Medicaid Services (“CMS”) promulgated the “Medicare Program: Hospital Outpatient Prospective Payment and Ambulatory Surgical Center Payment Systems and Quality Reporting Programs” (the “Final Rule”). The Final Rule decreased the reimbursement rates for participating hospitals purchasing medicine through the 340B Program from 6% above the average sales price to 22.5% below the average sales price.[2]

After the Final Rule was published on November 13, 2017, the American Hospital Association, America’s Essential Hospitals and the Association of American Medical Colleges (the “Plaintiffs”) sued the Department of Health and Human Services (“HHS”) and sought a preliminary injunction to stop the enforcement of the Final Rule.[3] The motion for the preliminary injunction was denied, so the Final Rule’s reimbursement cuts went into effect on January 1, 2018.
Continue Reading 340B Drug Pricing Program Litigation Update: Court Rejects CMS Drug Pricing Cuts

On Friday, December 14, 2018, a federal district court judge in Texas issued a widely anticipated opinion that struck down the entire Patient Protection and Affordable Care Act (“ACA”) as unconstitutional. The judge ruled in favor of the plaintiffs by determining that the “individual mandate”[1] is no longer a tax and is therefore an unconstitutional exercise of congressional authority. The judge also found that the individual mandate was inseverable from the rest of the ACA, which makes the entire ACA, not just the guaranteed issue and community rating provisions, unconstitutional.
Continue Reading Texas v. United States: Texas Federal Court “Strikes Down” the ACA

On December 3, 2018, the U.S. Department of Health and Human Services (“HHS”), in collaboration with the Departments of the Treasury and Labor, the Federal Trade Commission, and several offices within the White House, produced a 119-page report outlining recommendations to reform the healthcare system. This report is in response to Executive Order 13813, in which President Donald Trump directed the Administration, to the extent consistent with law, to facilitate “the development and operation of a healthcare system that provides high-quality healthcare at affordable prices” through the promotion of choice and competition.
Continue Reading Reforming America’s Healthcare System Through Choice and Competition: The Trump Administration Recommends Healthcare De-Regulation