California Governor Newsom signed Senate Bill 1120 into law, which is known as the Physicians Make Decisions Act. At a high level, the Act aims to safeguard patient access to treatments by mandating a certain level of health care provider oversight when payors use AI to assess the medical necessity of requested medical services, and by extension, coverage for such medical services.Continue Reading California Limits Health Plan Use of AI in Utilization Management
CMS recently published the First Annual Evaluation Report (the “Report”) highlighting its most significant observations in the first year following implementation of the Kidney Care Choices Model (the “KCC Model”). By way of background, the KCC Model is a payment model which creates certain incentives for providers that are intended to improve care management for Medicare patients with chronic kidney disease (“CKD”) (Stage 4 or 5) or end-stage renal disease (“ESRD”). The KCC Model is intended to, among other things, delay the dialysis progression and increase use of home dialysis, while also aiming to reduce the cost of care and improve quality of outcomes.Continue Reading CMS Releases First Annual Evaluation Report for Kidney Care Choices Model
California is among a handful of states that seeks to regulate the use of artificial intelligence (“AI”) in connection with utilization review in the managed care space. SB 1120, sponsored by the California Medical Association, would require algorithms, AI and other software tools used for utilization review to comply with specified requirements. We continue to keep up to date on AI related law, policy and guidance. The Sheppard Mullin Healthcare Team has written on AI related topics this year and those articles are listed here: i) AI Related Developments, ii) FTC’s 2024 PrivacyCon Part 1, and iii) FTC’s 2024 PrivacyCon Part 2. Also, our Artificial Intelligence Team’s blog can be found here. Experts report that anywhere from 50 to 75% of tasks associated with utilization review can be automated. AI might be excellent at handling routine authorizations and modernizing workflows, but there is a risk of over-automation. For example, population trends of medical necessity can miss unusual clinical presentations. SB 1120 seeks to address these concerns. Continue Reading The Intersection of Artificial Intelligence and Utilization Review
On Friday, August 26, 2022, the Department of Health and Human Services’ Centers for Medicare and Medicaid Services (“CMS”), the Department of Labor’s Employee Benefits Security Administration and the Department of Treasury’s Internal Revenue Service (the “Departments”) published a final rule updating key regulations pertaining to the No Surprises Act (the “Final Rule”). The Final Rule changes requirements promulgated through prior interim final rules[i] to conform with two rulings by the U.S. District Court for the Eastern District of Texas.[ii] The Final Rule addresses specific disclosure requirements for group health plans and health insurance issuers related to the Qualified Payment Amount (“QPA”) for out-of-network (“OON”) services and sets forth the factors and information which certified Federal Independent Dispute Resolution (“IDR”) entities must consider in arbitrating disputes for OON services or items.Continue Reading Final Rule Changes No Surprises Act Requirements
On Thursday, April 8, 2021, the Center for Medicare and Medicaid Innovation (the “Innovation Center”) announced its final list of 53 organizations set to participate in the Global and Professional Direct Contracting (“GPDC”) Model (previously named the Direct Contracting Model for Global and Professional Options). The 53 Direct Contracting Entities (“DCEs”) are participating in the first Performance Year (“PY2021”) of the GPDC Model, which runs from April 1, 2021 through December 31, 2021. The DCEs will serve Medicare fee-for-service (“FFS”) beneficiaries in 38 states as well as in the District of Columbia and Puerto Rico.
Continue Reading CMS Announces Final Organizations for the Global and Professional Direct Contracting Model, Halts Additional Applications and Future Solicitations
On October 6, 2020, the US Supreme Court (the “Court”) heard arguments on an Employee Retirement Income Security Act (“ERISA”) case that has the potential to curtail the rights of states to regulate their individual healthcare markets, in Rutledge v. Pharmaceutical Care Management Association (the “Case”).
Continue Reading ERISA: The Erosion of State Health Regulation Rights
On Thursday, April 16, 2020, the California Department of Managed Health Care (the “Department”) released an all plan letter (the “Letter”) regarding changes to the Department’s General Licensure Regulation (the “Regulation”) in light of the coronavirus (COVID-19) pandemic. The Letter updated the Department’s previous guidance concerning the Regulation that was issued on June 13, 2019. For further information, see our previous post regarding the Regulation here.
Continue Reading The California Department of Managed Health Care Extends the Phase-In Period for the General Licensure Regulation
On Tuesday, April 7, 2020, the California Department of Managed Health Care (the “DMHC”) released a guidance letter (the “Letter”) to all health care service plans regarding billing for and delivering telehealth services during the COVID-19 state of emergency. The Letter provides follow-up guidance to previous guidance the DMHC released on Wednesday, March 18, 2020 (the “Initial Guidance”). The DMHC has also provided additional information regarding the most frequently asked telehealth questions it has received (the “FAQs”).
Continue Reading California Department of Managed Health Care Releases Additional Guidance on Telehealth Services
This COVID-19 – LEGAL GUIDE FOR MEDICAL GROUPS (“Guide”) provides a general discussion of legal issues confronting medical groups as a result of COVID-19, including employee protections, infection control, and reporting obligations, workforce management and related mitigation strategies, employee obligations, business and payor relationships, privacy and telehealth, Medicare changes, and strategic transactions.
Continue Reading COVID-19 — Legal Guide for Medical Groups
On December 20, 2019, the Centers for Medicare and Medicaid Services (CMS) issued a final rule on program integrity for Affordable Care Act (ACA) exchange plans. This rule implements a number of provisions from the ACA, including the requirement that each state have the opportunity to establish an Exchange, as well as the steps the Secretary of Health and Human Services (HHS) may take to oversee Exchanges’ compliance with HHS standards, including ensuring their financial integrity, including conducting investigations and annual audits, and the requirement that the Secretary establish procedures to verify the accuracy of information provided by applicants, including eligibility to purchase qualified health plans (QHPs) through the Exchange and for advance payments of premium tax credit (APTC) and cost-sharing reductions (CSRs).
Continue Reading Health and Human Services Exchange Program Integrity Final Rule
Background
On June 28, 2018, California’s new privacy bill A.B-375 was signed into law as the California Consumer Privacy Act of 2018 (“CCPA”). On October 10, 2019, the California Attorney General issued proposed regulations for implementing and interpreting the CCPA.[1] Effective on January 1, 2020, the CCPA will apply to all for-profit entities and businesses that: