Health Care

The Office of Inspector General for the Department of Health and Human Services (OIG) recently published an Advisory Opinion in which it concluded that the provision of free genetic testing and counseling services by a pharmaceutical manufacturer would not result in the imposition of sanctions under the federal Anti-Kickback Statute (AKS) and the beneficiary inducements civil monetary penalty provision (Beneficiary Inducements CMP).  This Advisory Opinion is the first to address this type of arrangement and thus provides useful insight for the health care and life sciences industries.

The Office for Civil Rights (OCR) of the U.S. Department of Health and Human Services (HHS) released a Request for Information (RFI) to obtain industry feedback and inform potential future rulemaking regarding information security practices and civil money penalties (CMPs) under the Health Information Technology for Economic and Clinical Health (HITECH) Act and the HIPAA Security Rule. OCR is seeking input on how HIPAA covered entities and business associates are operationalizing “recognized security practices” as defined by Public Law 116-321. It is also requesting commentary on the methodologies used to disperse CMPs to individuals harmed by violations of certain privacy or security provisions of the HITECH Act or the Social Security Act, which we will cover in a separate post.

Under the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), the Health Resources and Services Administration (HRSA) of the Department of Health and Human Services (HHS) is authorized to distribute funds from its Provider Relief Fund (PRF) to certain providers. These providers can then use the funds to support COVID-19 prevention, preparedness, and response, or to alleviate loss of patient care revenue.  However, HRSA requires that providers receiving PRF funds comply with certain requirements, including post-payment reporting requirements.  HRSA is now notifying providers that failed to comply with the reporting requirements that they must return the PRF funds they received. 

As states move forward with their 2022 legislative sessions in earnest, we have been examining whether the Wehbi decision has had any initial effects on PBM-focused legislation. This roundup provides a brief recap of the significance of Wehbi, summarizes the Eighth Circuit’s opinion and holding, and highlights some state measures that have been proposed or passed during the flurry of PBM-focused legislation we have already seen in 2022.

The United States Department of Health and Human Services (HHS) and Centers for Medicare and Medicaid Services (CMS) leadership announced during last week’s HIMSS 2022 Conference that the agencies will be focusing on information blocking enforcement for the remainder of 2022. This blog post discusses the importance of closing the enforcement gap and the development of disincentives for health care providers. 

On March 18, 2022, President Biden signed the Dr. Lorna Breen Health Care Provider Protection Act (Act) into law. The Act is named for Dr. Lorna Breen, who served as the Medical Director of New York-Presbyterian Allen Hospital. Dr. Breen died by suicide in April 2020, as the COVID-19 pandemic was taking hold of the nation and, in particular, New York City. Since Dr. Breen’s passing, her family has established the Dr. Lorna Breen Heroes’ Foundation (Heroes’ Foundation). The Heroes' Foundation’s mission is to reduce burnout, safeguard the well-being of health care providers (HCPs), and reduce the stigma surrounding HCPs seeking help or treatment. The Act is a crucial step in achieving this mission.

Last week saw a lot of great news in the world of telehealth. On March 15, President Biden signed into law H.R. 2471, the “Consolidated Appropriations Act, 2022”, which extends many of the Medicare telehealth flexibilities put in place during the COVID-19 pandemic for a period following the end of the Public Health Emergency (“PHE”). The same day, the OIG issued a report highlighting the positive impact telehealth had on increasing access for beneficiaries during the first year of the pandemic. Then, during a press conference on March 18, HHS Secretary Xavier Becerra said that HHS will seek to sustain and expand access to telehealth services after the public health emergency ends. While these developments signal the continued expansion of telehealth, there is still some uncertainty surrounding coverage, reimbursement and licensure flexibilities that have allowed telehealth to flourish for the past two years.

On March 15, 2022, a drug pricing bill proposed by Connecticut Governor Ned Lamont’s (S.B. 13) was referred to the state legislature’s nonpartisan legal counsel responsible for drafting and processing official legislation. The proposed legislation, which would cap increases on pharmaceutical drugs to the rate of inflation plus 2%, is notable because it represents a relatively aggressive approach to addressing high drug prices. The legislation would also establish a program to authorize the importation of Canadian pharmaceuticals into the state.  

The Office of Inspector General for the Department of Health and Human Services (OIG) recently issued another favorable Advisory Opinion on patient incentives (e.g. gift cards or cash equivalents) given as part of patients’ treatment plans. Though the OIG reiterated its concern that cash and cash equivalents given to patients can present substantial fraud and abuse risks, the OIG concluded that the arrangement presented a minimal level of risk.

The U.S. Department of Justice (DOJ) has continued to investigate and prosecute alleged COVID-19 related fraud over the past two years since the pandemic began. On Thursday, DOJ announced the appointment of a Director for COVID-19 Fraud Enforcement, who will lead DOJ’s enforcement efforts in this area. Associate Deputy Attorney General Kevin Chambers will fill this position.

In an effort to counteract rising prescription drug costs and health insurance premiums, New York Governor Hochul signed S3762/A1396 (the Act) on December 31, 2021.  This legislation specifies the registration, licensure, and reporting requirements of pharmacy benefit managers (PBMs) operating in New York. The Superintendent of the Department of Financial Services (Superintendent) will oversee the implementation of this legislation and the ongoing registration and licensure of PBMs in New York. Notably, this legislation establishes a duty of accountability and transparency that PBMs owe in the performance of pharmacy benefit management services.

On Monday, February 7, 2022, U.S. Senators Catherine Cortez Masto, D-Nevada, and Todd Young, R-Indiana, introduced the Telehealth Extension and Evaluation Act, which if passed, would extend several of the telehealth waivers for two years after the end of the federal public health emergency (PHE). See our previous coverage of telehealth during the COVID-19 pandemic. The PHE was most recently renewed for an additional 90 days on January 16, 2022. Since January 2020, providers who pivoted to telehealth in order to deliver care to their patients during the pandemic have had to closely monitor the status of the PHE, which the Secretary of HHS is only authorized to extend for 90 days at a time. Passage of the proposed legislation would provide some much-needed certainty and would give providers time to transition back to in-person care where necessary. It would also further the growth and expansion of telehealth services and continued integration into our health care delivery system.

The Department of Justice announced in a February 1, 2022 press release (Press Release) that it obtained more than $5.6 billion in settlements and judgments from civil cases involving fraud and false claims in the fiscal year ending September 30, 2021 (FY2021) – the second largest annual total recovery in False Claims Act (FCA) history.

In a decision issued late last week, the First Circuit has adopted a deferential standard for review of government decisions to seek dismissal of whistleblower lawsuits brought under the False Claims Act (FCA). The court held that so long as the government explains its decision and provides the whistleblower with an opportunity to respond, the government’s motion must be granted absent evidence of collusion or unconstitutionality. This decision deepens a circuit split on the applicable standard under the FCA when the whistleblower objects to a government motion for dismissal.

On January 19, 2022, the Office of Inspector General for the Department of Health and Human Services (OIG) issued a favorable Advisory Opinion regarding an online retailer’s proposal to make its discount programs available to Medicaid beneficiaries. Currently, lower-income individuals are eligible for the retailer’s discount programs based on their enrollment in a number of assistance programs (e.g. Supplemental Security Income, Supplemental Nutrition Assistance Program), and the retailer proposes Medicaid enrollment as another category of eligibility.

The next post in our series analyzing the recently proposed Contract Year 2023 Policy and Technical Changes to the Medicare Advantage and Medicare Prescription Drug Benefit Programs rule (Proposed Rule), focuses on a regulation impacting Part D sponsors and their reporting of pharmacy price concessions. According to CMS, the proposed change—which would require the “negotiated price” of a covered Plan D drug to be the lowest possible payment made to a pharmacy by a Plan D sponsor—is expected to (i) reduce out-of-pocket costs for plan beneficiaries at the pharmacy counter, (ii) create greater drug price transparency, (iii) stabilize the operating environment for pharmacies and (iv) improve market competition.

Continuing our series analyzing the recently proposed Contract Year 2023 Policy and Technical Changes to the Medicare Advantage and Medicare Prescription Drug Benefit Programs rules (Proposed Rule), this post focuses on a few items that are specific to Medicare Advantage (MA) Plans. Here, we discuss CMS’ proposals to (1) require initial and expanded services area applicants to submit their proposed contracted networks during the application process, (2) clarify that beneficiary access requirements during disasters and emergencies apply when there is a “disruption in access to health care,” (3) return to medical loss ratio (MLR) reporting requirements from 2014 – 2017, and (4) an adjustment to how the maximum out-of-pocket (MOOP) limit is calculated for dually-eligible beneficiaries.

On January 12, 2022, the co-owner of a clinical research site in Miami, Florida pleaded guilty to one count of obstruction of justice after she knowingly lied to a United States Food and Drug Administration (FDA) investigator during a 2017 regulatory inspection. Olga Torres co-owned the clinical research site, Unlimited Medical Research (UMR). During its years of operation, UMR was engaged as a clinical trial site by a number of pharmaceutical companies. The conduct that led to the obstruction of justice charge stemmed from a clinical trial conducted at UMR to evaluate the safety and efficacy of a pediatric asthma drug.

As we noted, Centers for Medicare & Medicaid Services (“CMS”) recently proposed its Contract Year 2023 Policy and Technical Changes to the Medicare Advantage and Medicare Prescription Drug Benefit Programs rules (“Proposed Rule”) that would increase consumer protections and reduce health care disparities in Medicare Advantage (“MA”) and Part D. In the Proposed Rule, CMS proposes major modifications to its regulations governing Dual Eligible Special Needs Plans (“D-SNPs”), which are MA products specifically for individuals who are dually eligible for Medicare and Medicaid. These changes are informed by the success of CMS’ Financial Alignment Demonstration and Medicare-Medicaid Plans (“MMPs”). In fact, under the Proposed Rule, CMS is proposing that many key characteristics of MMPs be incorporated into D-SNPs. CMS is also proposing to update the definitions of Fully Integrated Dual Eligible Special Needs Plans (“FIDE SNPs”) and Highly Integrated Dual Eligible Special Needs Plans (“HIDE SNPs”) to incorporate successful characteristics of MMPs and to better clarify and differentiate these terms.

Last week, CMS announced proposed rules seeking to increase consumer protections and reduce health care disparities in Medicare Advantage (MA) and Part D, with a strong emphasis on individuals who are dually eligible for Medicare and Medicaid. Over the next few weeks, the Mintz team will provide an in-depth review and analysis of the proposed rules here on our blog. In the meantime, here is summary of the proposed changes.