340B Drug Pricing Program Litigation Update: American Hospital Association, Et Al. v. Azar

On July 17, 2018, the Court of Appeals for the D.C. Circuit upheld the D.C. District Court’s decision to dismiss the lawsuit led by the American Hospital Association, the Association of American Medical Colleges, and America’s Essential Hospitals challenging $1.6 billion in cuts to the 340B Drug Pricing Program. American Hospital Association, et al., v. Azar. Continue Reading

Federal Regulatory Developments Brewing in Telehealth

Two federal agencies – the Centers for Medicare and Medicaid Services (“CMS”) and the Federal Communications Commission (“FCC”) – announced separate initiatives last week that stand to increase patient access to telehealth services. Continue Reading

Humana, TPG Capital, and Welsh, Carson, Anderson & Stowe Create the Country’s Largest Hospice Provider, “Kindred at Home”

Kindred Healthcare. On July 2, 2018, Humana Inc. and private equity firms TPG Capital (TPG), and Welsh, Carson, Anderson & Stowe (Welsh) (collectively referred to as the Consortium) issued a press release announcing the closure of their $4.1 billion joint acquisition of Kindred Healthcare, Inc. Kindred Healthcare, Inc. is a national owner/operator of long-term acute care hospitals, inpatient rehabilitation facilities, rehabilitation service providers and, through Kindred at Home (KAH), home health agencies, hospices, telehealth providers, and community care facilities. Continue Reading

Texas Hospital Order to Pay $4.3M for Failure to Implement its HIPAA Security Policies

The following article was originally posted to the Eye on Privacy Blog on July 5, 2018

A Texas hospital was recently ordered by an administrative law judge to pay a $4,300,000 penalty for three data breaches over the course of 2012 and 2013 that exposed the personal health information – including social security numbers, patient names and treatment records – of more than 33,000 individuals in violation of HIPAA. The specific incidents related to the theft of an unencrypted laptop and the loss of unencrypted USB flash drives, both of which contained electronic personal health information. Continue Reading

Following Repeal of the Individual Mandate, Twenty States Challenge the Affordable Care Act

On February 26, 2018, twenty states (the “Plaintiffs”) jointly filed a lawsuit[1] in the U.S. District Court for the Northern District of Texas requesting that the court strike down the Patient Protection and Affordable Care Act (“ACA”), as amended by the Tax Cuts and Jobs Act of 2017 (the “TCJA”), as unconstitutional. The Plaintiffs’ suit gained support from the White House last week, when Attorney General Jeff Sessions delivered a letter to House Speaker Paul Ryan on June 7, 2018 (the “Letter”), indicating that the Attorney General’s Office, with approval from President Trump, will not defend the constitutionality of the individual mandate – 26 U.S.C. 5000(A)(a) – and will argue that “certain provisions” of the ACA are inseverable from that provision.[2] The Letter indicates that this is “a rare case where the proper course is to forgo defense” of the individual mandate, reasoning that the Justice Department has declined to defend statutes in the past when the President has concluded that the statute is unconstitutional and clearly indicated that it should not be defended. Continue Reading

The VA MISSION Act: Enhancing Healthcare for Veterans

On Wednesday, June 6, 2018, President Trump signed into law the “John S. McCain III, Daniel K. Akaka, and Samuel R. Johnson VA Maintaining Internal Systems and Strengthening Integrated Networks Act” a.k.a. the VA MISSION Act of 2018 (“VAMA”), a $52 billion reform bill aimed at improving access to, and the quality of, medical services provided to veterans by the Department of Veterans Affairs (“VA”). Continue Reading

Health Care Organizations Take Notice: The Joint Commission Issues Recommendations to Stem Workplace Violence

Originally Posted on the Sheppard Mullin Labor and Employment Blog on June 6, 2018.

In an effort to curb workplace violence against healthcare workers, The Joint Commission, a national healthcare accreditation body, recently issued seven actions healthcare organizations are encouraged to implement. Continue Reading

In a Unanimous Vote, the Opioid Crisis Response Act of 2018 Makes it Onto the Legislative Calendar

As previously discussed in our post from September 2017, the push for a response to the opioid crisis is gaining momentum. Enter the “Opioid Crisis Response Act of 2018.”

On May 7, 2018, the Opioid Crisis Response Act of 2018 (the “Bill”) was placed on the Senate Legislative Calendar after a unanimous vote out of the Senate Health, Education, Labor and Pensions Committee just weeks before on April 24. A showing of legislative commitment and intent, the Bill begins to tackle many of the key issues underlying and exacerbating the epidemic, though stakeholders remain concerned as to whether it goes far enough in light of the magnitude and complexity of the crisis. Continue Reading

The Shape of Healthcare: Blockbuster Mergers, Retail Healthcare, and Marcus Welby, M.D

It has been widely reported that healthcare mergers and acquisitions are off to a strong start this year after ending a record-breaking year in 2017. In fact, the healthcare press this year has been replete with articles extolling the “good news” about healthcare investment and transaction activity. For example:

  1. As reported by Kaufman Hall, the number of “hospital and health system transactions announced in 2017 totaled 115, up 13% over 2016 and the highest number recorded in recent history.” Kaufman Hall, “2017 in Review: The Year M&A Shook the Healthcare Landscape,” January 29, 2018;
  2. According to data from Bloomberg, the total deal value of healthcare transactions announced in the first quarter of 2018 is approximately $156 billion. “Health-Care M&A Balloons in Busiest Start in More than a Decade,” by Manuel Baigorri (March 28, 2018) (https://www.bloomberg.com/news/articles/2018-03-28/health-care-m-a-booming-in-busiest-start-in-more-than-a-decade). Not surprisingly, Bloomberg’s transaction value data also shows that first quarter 2018 is the busiest first quarter in more than ten years; and
  3. As reported last month by Forbes in, “Why Private Equity Loves Retail Healthcare from 2012 to 2017,” Nirad Jain, Kara Murphy and Jeremy Martin, April 4, 2018, https://www.forbes.com/sites/baininsights/2018/04/04/why-private-equity-loves-retail-healthcare/#4883ce071924, “From 2012 to 2017, the number of deals involving retail health companies—those that operate freestanding health-related outlets like dental clinics or urgent care facilities—has soared, increasing at a compound annual rate of 34% in the North American market.” Citing, the Bain & Company’s Global Private Equity Report 2018 (http://go.bain.com/global-private-equity-report-2018.html), the authors write that the growth in retail healthcare transactions is, in some significant part, a function of the fact that, “retail health is a fragmented, high-margin sector with strong growth characteristics. In a sea of high prices, it still offers targets at reasonable multiples and many opportunities to unlock substantial value.”

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Healthcare Industry Companies Must Be Wary of Classifying Any Workers As Independent Contractors, In Light of the California Supreme Court’s Dynamex Ruling

As you may have seen in our recent article on the Labor and Employment Law Blog, the California Supreme Court recently issued a landmark decision in the case of Dynamex Operations West, Inc. v. Superior Court. (The full text of the Dynamex decision can be found here.) In its ruling, the Court establishes a standard that makes it extremely difficult for companies (or individuals) in California to properly classify their workers as independent contractors. Continue Reading

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