Health Care

At the end of March 2022, the Centers for Medicare & Medicaid Services (CMS) released guidance to drug manufacturers and states on reporting Medicaid Best Price under value based purchasing (VBP) arrangements (Medicaid Best Price Guidance or Guidance).  This Guidance follows CMS’ final rule issued on December 31, 2020 (Final Rule) responding to criticism that Medicaid Best Price requirements are hindering the use of VBP arrangements.  The Final Rule and Guidance will go into effect on July 1, 2022, allowing manufacturers to report multiple best prices for VBP arrangements so long as the manufacturer offers the VBP arrangement to state Medicaid programs. This blog post will begin with a “101” on the Medicaid Best Price Policy, and then delve into an overview of the Final Rule, including the surrounding criticism from stakeholders; summarize the Medicaid Best Price Guidance; and discuss the potential impact of this change on states and manufacturers

On March 17, the same day we wrote about proposed legislation in Connecticut to cap drug price increases, Governor Charlie Baker of Massachusetts included a similar proposal in his proposed budget.  Similar to the Connecticut legislation, the Massachusetts bill (S. 2774) would penalize manufacturers for increasing the price of any medication above its reference price, adjusted for inflation using the Consumer Price Index, plus 2%.  Manufacturers that exceed this threshold would have to pay a penalty equal to 80% of the amount above the excessive price increase threshold – meaning the manufacturer would essentially only collect 20% of the revenue for a drug above the price cap.  Like the Connecticut bill, the reference price is based on a drug’s Wholesale Acquisition Cost (WAC), which is essentially the list price set by manufacturers for a prescription drug before any negotiations or discounting. This article addresses the implications if S.2774 were to become law. 

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. 

Listen to our team discuss key takeaways from the weeklong summit and how industry trends are impacting business practices.

During this program, Mintz attorneys Nancy Adams, Lara Compton, Todd Rosenbaum, and Jennifer Rubin provided an overview of key risk factors for telehealth companies and pragmatic takeaways which you can incorporate into your business practices

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.

Health regulatory diligence has the ability to make or break a deal. Listen to hear about our team’s firsthand experience in the importance of conducting health regulatory diligence and best practices in preparing for a sell-side transaction.

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.

Health care providers, health information networks, health information exchanges, and health IT developers of certified health IT will want to take note of the information blocking claim submission trends recently published by the Office of the National Coordinator for Health Information Technology (ONC).

2021 was a busy year for Mintz ’s Health Law team, as they helped clients navigate complex health care transactions.

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.

In our annual webinar, Mintz’s Health Care Enforcement Defense team reviewed the key health care fraud enforcement developments and trends from 2021, assessed their likely impact in 2022, and provided recommendations to avoid government scrutiny.

In our annual Health Care Enforcement Year in Review & Outlook report, we examine the data and explore health care enforcement trends and likely targets of government scrutiny for 2022 and beyond.