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Michael W. Paddock is a partner in the Corporate Practice Group in the firm's Washington D.C. office.

The Eighth Circuit Court of Appeals recently tossed a $5.5 million jury verdict finding that a physician violated the False Claims Act (“FCA”) by submitting claims for items and services ordered subsequent to a violation of the Federal health care program anti-kickback statute (“AKS”). According to the appellate court, the trial court’s jury instruction “brushed aside causation” and “misinterpreted” a 2010 amendment to the AKS.

Continue Reading Eighth Circuit: In False Claims Act Cases Based On Kickback Violations, the Kickback Violation Must Be the “But For” Cause of the Items and Services Subject to the Claim

Since its passage in late 2018, the Eliminating Kickbacks in Recovery Act (EKRA) (18 U.S.C. § 220) has posed interpretive challenges. Our detailed critical analysis of EKRA is available here. EKRA prohibits, among other things, the exchange of remuneration for referrals of patients or patronage to a clinical laboratory, or an individual’s use of the services of a clinical laboratory. The law, however, leaves key terms undefined, including “referral”, “patronage”, and “use of services.” This ambiguity leaves unclear exactly which forms of conduct are prohibited by EKRA. Further, EKRA contains exceptions that overlap imperfectly with safe harbors under the Anti-Kickback Statute (AKS) and states, confusingly, that EKRA “shall not apply to conduct that is prohibited” by the AKS. The latter provision imperils the status of conduct that is within an AKS safe harbor, but which does not meet the requirements of an EKRA exception. No implementing regulations have been published to alleviate any of these ambiguities.

Continue Reading California District Court Finds that EKRA Applies to Compensation Methodologies for Labs’ Employed Marketers Who Market to Physicians

As of April 11, 2022, the Health Resources & Services Administration (“HRSA”) is now offering providers who missed the original Provider Relief Fund (“PRF”) reporting deadlines the opportunity to request the ability to report in compliance with the PRF Terms and Conditions. Request submissions for Reporting Period 1 are due by Friday, April 22, 2022.
Continue Reading Alert to Providers: Another Shot to Comply with Provider Relief Fund Reporting Requirements

On August 13, 2021, the D.C. Circuit Court of Appeals reversed a district court opinion vacating CMS’ Overpayment Rule, 42 C.F.R. 422.326, for Medicare Advantage organizations (“MAOs”).  UnitedHealthcare Insurance Co. et al. v. Becerra et al., case number 18-5326.  As a result of this decision, CMS can once again rely on the Overpayment Rule to impose voluntary refund obligations for MAOs.  MAOs – already subject to significant government enforcement related to their risk adjustment coding practices – should carefully consider the implications of this decision for their coding and auditing practices.

Continue Reading D.C. Circuit Gives New Life to CMS Overpayment Rule

Introduction

CMS’ most recent Stark Law rulemaking includes important changes to the rules that allow physician practices to satisfy the definition of “Group Practice” while distributing designated health services (“DHS”) – based profit shares and productivity bonuses. 85 Fed. Reg. 77492 (Dec. 2, 2020) (the “Final Rule”).  As these changes go into effect January 1, 2022, and the ability to bill Medicare for DHS is often contingent on satisfying the definition of “Group Practice,” physician practices should take action now to assess their physician compensation arrangements and methodologies under the new rules.

Continue Reading Physician Group Practices Take Heed – January 1, 2022 Deadline Approaches for Compliance with CMS’ Recent Changes to Permissible “Group Practice” Compensation Methodologies

On July 13, 2021, the Centers for Medicare and Medicaid Services (“CMS”) released a Proposed Rule that proposes to amend certain regulations implementing the Physician Self-Referral Law, otherwise known as the “Stark Law”. The Proposed Rule proposes to revise once again the definition of “indirect compensation arrangement” (ICA), effectively to revert the meaning of the definition back – for the vast majority of indirect financial relationships between DHS entities and referring physicians – to the definition of that term as it was in place prior to the latest Stark Law rulemaking, “Modernizing and Clarifying the Physician Self-Referral Regulations” (the “MCR Final Rule”), published on December 2, 2020.[1]  The Proposed Rule also proposes to define the term “unit” and the phrase “services that are personally performed”, both for purposes of the ICA definition.

Continue Reading CMS Proposes to Revise, Again, the Stark Law’s Definition of “Indirect Compensation Arrangement”: What Was Old is New Again

In July 2020, we discussed a ruling by the D.C. Court of Appeals upholding the Department of Health and Human Services’ (HHS) site-neutral payment rules. On Monday, June 28, 2021, the Supreme Court declined, without comment, to hear an appeal from the American Hospital Association (AHA) and other provider groups asking it to reverse this ruling.

Continue Reading Site-Neutral Payments Stand: SCOTUS Declines to Hear AHA Appeal, Preserving Lower Payments to Off-Campus Provider-Based Departments

In our November 25, 2000 Healthcare Law Blog article, “Big Changes for Health Care Fraud and Abuse: HHS Gifts Providers Updates to the Stark Law and the AKS, Just in Time for the Holidays,”  we discussed the advanced publication of two significant final rules intended to “modernize” and “clarify” regulations regarding the Physician Self-Referral Law (“Stark Law Final Rule”) and the Anti-Kickback Statute (“AKS Final Rule”) – both formally published on December 2, 2020 by the Centers for Medicare and Medicaid Services (“CMS”) and the Department of Health and Human Services, Office of Inspector General (“OIG”), respectively.
Continue Reading Analysis of OIG’s New and Revised Regulatory Safe Harbors to the Federal Health Care Program Anti-Kickback Statute and Beneficiary Inducement Prohibition

As mentioned in our November 25, 2000 Healthcare Law Blog article, “Big Changes for Health Care Fraud and Abuse: HHS Gifts Providers Updates to the Stark Law and the AKS, Just in Time for the Holidays,” the Centers for Medicare & Medicaid Services (CMS) published a final rule (“Final Rule”) on December 2, 2020 making significant changes to the regulatory framework implementing the federal physician self-referral prohibition (the “Stark Law”), 42 C.F.R. 411.351 et seq.
Continue Reading Critical Analysis and Practical Implications of CMS’ Changes to the Stark Law’s Implementing Regulations

On November 20, 2020, the Centers for Medicare and Medicaid Services (“CMS”) and the Office of Inspector General (“OIG”) promulgated much-anticipated and significant final rules intended to “modernize” and “clarify” regulations regarding the Physician Self-Referral Law (“Stark Law Final Rule”) and the Anti-Kickback Statute (“AKS Final Rule”).  In the immediate future, Sheppard Mullin will post on this Healthcare Law Blog a comprehensive critical analysis of both the Stark Law Final Rule and the AKS Final Rule and their practical impacts.
Continue Reading Big Changes for Health Care Fraud and Abuse: HHS Gifts Providers Updates to the Stark Law and the AKS, Just in Time for the Holidays

As the pandemic rages on, and the United States has seen a spike in coronavirus cases in recent days, many healthcare providers are still struggling to care for patients and remain afloat. In response, HHS is continuing support and extending flexibility.
Continue Reading More Relief on the Way for Healthcare Providers: Provider Relief Fund Payment Opportunities and Flexibility in Repayment Requirements