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The Department of Health and Human Services (HHS) is pushing ahead in its Regulatory Sprint to Coordinated Care with a new proposed rule, announced by HHS’ Office for Civil Rights on December 10, to modify the HIPAA Privacy Rule. This proposed rule follows HHS’ 2018 Request for Information on Modifying HIPAA Rules to Improve Coordinated Care, which sought to identify regulatory impediments to value-based care presented by HIPAA. With this proposed rule, HHS aims to “reduce burden on providers and support new ways for them to innovate and coordinate care on behalf of patients, while ensuring that [HHS] uphold[s] HIPAA’s promise of privacy and security,” according to HHS Deputy Secretary Eric Hargan. It would achieve these objectives through a variety of updates to the Privacy Rule, which we highlight in this blog post, along with initial reactions from our HIPAA privacy team.
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As you know, we have been parsing through the HHS rules that finalize important changes to the Anti-Kickback Statute (AKS) and Physician Self-Referral Law (Stark Law) regulations, which go into effect January 19, 2021. Today, we are taking a look at changes to existing AKS safe harbors and Stark Law exceptions, and, an extra add-on: a new Stark Exception for Limited Remuneration to a Physician. Mintz is also hosting a webinar during which we will review the key provisions from the final rules and provide practical examples of how the industry can take advantage of these significant changes. We hope you can join us.
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This third post in our multi-part series on the final rules examines the three new AKS safe harbors and four new Stark Law exceptions that offer protection for value-based arrangements. The primary goal of these final rules is to reduce regulatory barriers and advance the health care industry’s transition to value-based care. Value-based care, often referred to as pay-for-performance, is a payment model that offers health care providers and suppliers financial incentives to meet certain performance measures that improve quality of care or appropriately reduce costs, as opposed to traditional fee-for-service or capitated payments healthcare reimbursement.

Plus, we have prepared easy-to-read comparison charts breaking down the current, proposed, and final regulations. These comparison charts offer a quick way to get up to speed on these voluminous final rules and their many historic changes to the AKS and Stark Law.
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HHS Finalizes Highly Anticipated Final Rules Amending Anti-Kickback Statute and Stark Law Regulations, Part II: Beneficiary Inducement

December 1, 2020 | Blog | By Karen Lovitch, Ellyn Sternfield, Rachel Yount, Jane Haviland

While health care entities often want to provide free or discounted items or services to patients (e.g., free transportation, co-payment waivers, free supplies), these free or discounted items or services pose risk under both the federal Anti-Kickback Statute (AKS) and the civil monetary penalty rules regarding beneficiary inducements (Beneficiary Inducements CMP), so minimizing risk when providing such items or services is important.  Fortunately, as announced last week, the Department of Health and Human Services (HHS) Office of Inspector General (OIG) issued a final rule making sweeping changes to the regulations implementing the AKS and the Beneficiary Inducements CMP, many of which will result in greater flexibility and reduced administrative burdens for the health care industry. 
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Are Speaker Programs a Thing of the Past? OIG’s Fraud Alert Indicates It Thinks They Should Be

November 25, 2020 | Blog | By Laurence Freedman, Elizabeth Conti

In the midst of the pandemic emergency, the Department of Health and Human Services Office of Inspector General (OIG) issued a stern warning about in-person educational programs for health care professionals (HCPs), known as “speaker programs.” The OIG’s Special Fraud Alert (Alert) highlights what it deems the “inherent fraud and abuse risks” associated with the offer, payment, solicitation, or receipt of remuneration related to speaker programs by pharmaceutical and medical device companies. The OIG expressed that is skeptical of the educational value of such programs, and thus the Alert sends a clear signal that such programs will undergo intense scrutiny under the federal Anti-Kickback Statute (AKS). OIG is using the pandemic as an opportunity to caution the pharmaceutical and medical device industry to limit or eliminate in-person speaker programs once such programs are able to resume.
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HHS Issues Controversial Drug Rebate Reform Final Rule

November 25, 2020 | Blog | By Theresa Carnegie

On Friday, November 20, the Administration took bold action by releasing a contentious rule designed to disrupt the drug supply chain status quo. The Pharmaceutical Rebates final rule will alter how drug discounts offered by pharmaceutical manufacturers to plan sponsors or their PBMs, and service fees paid by such manufacturers to PBMs, are treated for purposes of the federal Anti-Kickback Statute (AKS). As we discuss in this alert, the policies set out in this final rule are not surprising, in light of other actions taken by the Trump Administration to date. However, the transformational effects the rule will have on the drug supply chain, coupled with a lack of consensus among lawmakers and industry stakeholders about the best approach to drug pricing reform, ensures that litigation of this new rule will inevitably ensue.
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On November 20, 2020, the Department of Health & Human Services (HHS) finalized significant changes to the regulations implementing the Anti-Kickback Statute (AKS), the Physician Self-Referral Law (commonly known as the Stark Law), and the civil monetary penalty rules regarding beneficiary inducements (Beneficiary Inducements CMP). The final rules are part of HHS’s Regulatory Sprint to Coordinated Care and are designed to offer the health care industry more flexibility and to reduce the regulatory burden associated with the AKS and the Stark Law, particularly with respect to value-based arrangements and care coordination. Offering a number of industry-friendly changes, the final rules will have a far-reaching impact on the health care industry.
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Post-Election 2020 - Health Care Preview

November 23, 2020 | Blog | By Alexander Hecht, Anthony DeMaio, Brett Else, Tara E. Dwyer, Ellyn Sternfield

With the presidential transition underway, we now look forward to what the Biden administration will seek to accomplish, particularly in the realm of health care policy.
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As COVID-19 infection rates continue to rise in areas of the country, telehealth continues to play an important role in the delivery of healthcare, especially to those most vulnerable to the virus. Existing telehealth waivers continue in effect under the Public Health Emergency, and new legislation seeks to expand telehealth access through home health services. Plus, join us for a webinar on the future of telehealth.
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DEA Releases Long-Awaited Suspicious Orders Proposed Rule

November 6, 2020 | Blog | By Elizabeth Conti, Joanne Hawana

It has been a long time coming. On November 2, 2020, the Drug Enforcement Administration (DEA) released its long-awaited proposed rule to revise the regulations related to suspicious orders of controlled substances. The proposed rule will implement the Preventing Drug Diversion Act of 2018 (PDDA) and clarify the procedures a registrant must follow for orders received under suspicious circumstances, referred to as “ORUSCs.” There are four key regulatory changes being proposed by DEA: (1) new definitions, (2) expansion of the types of registrants required to report, (3) procedures for identifying and reporting suspicious orders, and (4) reporting and recordkeeping requirements.
Key to the proposed rule is the establishment of a “two-option framework” for registrants to deal with ORUSCs: namely, they could (1) decline to ship the ORUSC and immediately file a suspicious order report to DEA’s centralized database, or (2) conduct due diligence into the ORUSC and make a determination about the order’s validity within seven calendar days, among other requirements. DEA is accepting electronic and written comments on the proposed rule through January 4, 2021.
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An Update on FDA’s Contribution to COVID-19 Diagnostic Testing

November 5, 2020 | Blog | By Joanne Hawana

Back in the early days of the COVID-19 pandemic, we published a post outlining the different kinds of diagnostic tests that were being marketed and the different roles of the two main federal regulators that oversee the quality of different subsets of tests. Since then, there have been some important policy developments affecting diagnostic and antibody testing. There also has been significant growth in the number of tests authorized by the Food and Drug Administration for point-of-care uses in various patient settings such as clinics, emergency departments, and physician offices. Read on for an update about these developments.
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On October 29, 2020, the Department of Justice (DOJ) announced the first publicly-available settlement involving alleged violations of CMS’s Open Payments Program, otherwise known as the Sunshine Act. The $9.2 million settlement resolved allegations that Minnesota-based medical device manufacturer Medtronic USA Inc. violated (i) the Anti-Kickback Statute (AKS) and the False Claims Act (FCA) by paying kickbacks to a South Dakota neurosurgeon, Wilson Asfora, M.D., and (ii) the Open Payments reporting requirements by failing to accurately report payments it made to Asfora to the Centers for Medicare & Medicaid (CMS). While this settlement is the first public enforcement action involving Open Payments violations, more enforcement actions may be expected in the near future.
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US Health System Warned of Coordinated Ransomware Attacks

October 30, 2020 | Blog | By Dianne Bourque

US hospitals and healthcare facilities struggling to maintain normal operations during the COVID-19 emergency, were warned this week by the federal Cybersecurity and Infrastructure Agency (CISA), the Federal Bureau of Investigation (FBI) and the Department of Health and Human Services (HHS) of a “targeted and imminent cybercrime threat.” Specifically, CISA, FBI and HHS have credible information that malicious cyber actors are targeting hospitals and other health care providers with Trickbot malware, leading to ransomware attacks, data theft and significantly, the disruption of healthcare services during the pandemic.
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Bioethics in a Pandemic: FDA Guidance on Granting EUAs for a COVID-19 Vaccine

October 29, 2020 | Blog | By Bridgette Keller, Benjamin Zegarelli

Earlier this month, the FDA’s Center for Biologics Evaluation and Research issued its highly anticipated guidance outlining the agency’s current thinking on granting emergency use authorization (EUA) to investigational vaccines for COVID-19. This guidance was the subject of intense political debate among the White House, FDA, and other public health officials given the urgent need for a safe and effective vaccine.
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As the COVID-19 pandemic continues to upend our daily lives, the promise of a vaccine offers hope that life may, in the not-too-distant future, return to some version of normalcy. The path to getting a safe, accessible vaccine to market, however, presents a variety of its own challenges. As we’ve been exploring in our Bioethics in a Pandemic blog series, the pandemic has presented a host of bioethics issues pertinent to the vaccine development and distribution process. Mintz's Bridgette Keller recently shared her insights into how bioethics can (and should!) influence research and development at the M2D2 Challenge Awards. A video of her presentation is now available to view online.
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Bioethics in a Pandemic: Final Framework for Equitable Allocation of a COVID-19 Vaccine

October 20, 2020 | Blog | By Bridgette Keller, David Friedman

Earlier this month, the National Academies Committee on Equitable Allocation of Vaccine for the Novel Coronavirus released its Final Framework to guide US distribution and administration of a COVID-19 vaccine, once available. The nuts and bolts of the Final Framework remain largely the same as the Draft Framework we covered previously in our Bioethics Blog Series. After a quick review of the Allocation Phases here, we explore a few areas in the Final Framework the Committee expanded on and responded to stakeholder comments.
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You’d be forgiven in the current climate of coronavirus and election season, to name just a couple hot issues of the day, for missing two recent announcements from the FDA about its digital health program. On September 14, 2020, FDA published “Developing the Software Precertification Program: Summary of Learnings and Ongoing Activities” and the following week, on September 22, launched the Digital Health Center of Excellence.
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CMS recently issued a proposed rule that would grant breakthrough medical devices Medicare coverage immediately upon FDA approval. The rule also proposes to codify a new definition of “reasonable and necessary” for Medicare national coverage determinations that takes into account commercial insurance coverage of items and services. It is unclear how broadly this new "reasonable and necessary" definition will apply if the proposed rule is finalized.
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The U.S. Food and Drug Administration (FDA) recently announced what appears to be the first public warning made by the agency to a company promoting an approved prescription drug product for the unapproved use of treating COVID-19 symptoms. Although the regulatory action was announced in the FDA’s daily pandemic update on October 2, 2020, the warning letter issued by the Office of Prescription Drug Promotion (OPDP) is dated September 22, 2020. From our perspective, this public FDA action is notable for two distinct policy reasons.
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On September 24, 2020, HHS announced that it had finalized the Section 804 Importation Program regulations, which fall under the authority of Section 804 of the Federal Food, Drug and Cosmetic Act (FD&C Act) (21 U.S.C. § 384). Although the Section 804 authority has been in place for nearly twenty years, no previous HHS Secretary had been willing to certify, as required by the law, that drug importation would “pose no additional risk to the public’s health and safety” and would “result in a significant reduction in the cost of covered products to the American consumer.” The preamble to the Final Rule states that HHS Secretary Alex Azar is making the necessary certification to Congress in conjunction with this Final Rule. It also addresses a variety of comments from stakeholders regarding the scope and timing of the Section 804 certification, each of which raise novel questions of law and policy in light of the untested nature of the requirement. Perhaps most interestingly, however, the Final Rule notes several times that HHS/FDA is “unable to estimate the cost savings from this final rule, because we lack information about the likely size and scope of [Section 804 Importation Programs], the specific eligible prescription drugs that may be imported, the degree to which these imported drugs will be less expensive than nonimported drugs available in the United States, and which eligible prescription drugs are produced by U.S.-based drug manufacturers,” making it difficult to reconcile how the HHS Secretary was able to certify that it would result in a significant reduction in costs for U.S. consumers.
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