By Ryan Wesley Brown
In December, several members of the House and Senate expanded a bipartisan investigation into what is commonly referred to as “surprise billing.” Their investigation focuses on the practice of billing patients for medical services when patients receive care by out-of-network physicians at an in-network facility. The legislators sent letters to several of the largest insurers and physician staffing companies in order to gather more information about this practice.
In these letters, legislators sought further information about the reasons for surprise bills as well as “the current incentives behind the negotiations between providers and insurers.” The letters focus particularly on those services that are “outsourced” by hospitals to physician staffing companies. Generally, these physician staffing companies and hospitals will have negotiated separately with insurers, resulting in a discrepancy between insurance coverage for the facility versus the provider.
These letters follow earlier efforts by legislators to investigate private equity firms with ownership interests in physician staffing and emergency transportation companies.
At the time of this investigation, several states have implemented laws to prohibit or regulate this practice, and congressional debate on the topic is ongoing. The bipartisan support for these investigations suggests that there is some momentum in Congress for passing federal legislation, but it is not yet clear what form that will take and where partisan lines may be drawn.
Federal legislation in this area may ultimately regulate ERISA plans. This is significant because state laws are generally preempted by ERISA with respect to surprise billing and only some states have allowed ERISA plans to “opt in” to their surprise billing schemes.
We will continue to closely follow these developments at the federal level along with our ongoing analysis of state-level efforts to regulate surprise billing practices.
In a concise, six-page discovery order, a federal judge in Minneapolis may have just started the proverbial shifting of tectonic plates undergirding routine defense procedures in False Claims Act (FCA) litigation by requiring a defendant in an FCA lawsuit to produce the information provided to the Department of Justice (DOJ) during the DOJ’s process of determining whether to pursue the matter.
The FCA creates liability for persons or entities found to have knowingly submitted false claims to the government or having caused others to do so. Like some other federal laws, the FCA creates a private right of action; under the act, a private party—a whistleblower or “relator”—may bring a qui tam action on behalf of the government. When initially filed, the court seals the complaint pending the government’s investigation of the case. If the government chooses, it may intervene and pursue the matter. If not, the relator may pursue the case on its own. (In either case, the relator is entitled to a percentage of the government’s recovery.)
View the full Alert on the Duane Morris LLP website.
Disability discrimination lawsuits against hospitals have become relatively common in recent years as former hospital employees allege that their former employers discriminated against them on the basis of various disabilities in violation of the Americans with Disabilities Act of 1990. Other ADA lawsuits have been filed against hospitals and other healthcare providers, claiming that their websites or parking lots do not adequately accommodate those with disabilities. Yet others have been filed accusing hospitals of failing to accommodate deaf patients by not providing a live interpreter. But few, if any, major lawsuits had been brought against hospitals and healthcare providers alleging that the facilities themselves fail to accommodate patients with physical disabilities. That may have changed with a putative class action lawsuit filed in the U.S. District Court for the Western District of Pennsylvania in late July, which may be the first of many cases to come.
View the full Alert on the Duane Morris LLP website.
By Susan V. Kayser
On July 23, 2019, the U.S. Senate Finance Committee held a hearing where a representative of the Government Accountability Office testified on elder abuse in nursing homes. At the hearing, reported at GAO-19-671T, the GAO representative discussed the June 2019 GAO report entitled “Improved Oversight Needed to Better Protect Residents from Abuse” (GAO-19-433).
The GAO analysis of CMS data found that, while relatively rare, abuse deficiencies cited in nursing homes more than doubled, increasing from 430 in 2013 to 875 in 2017, with the largest increase in severe cases. In light of the increased number and severity of abuse deficiencies, GAO testified that, while it is imperative that CMS have strong nursing home oversight in place to protect residents from abuse, there are several oversight gaps that may limit the agency’s ability to do so. The gaps include:
- Information on abuse and perpetrator type is not readily available. CMS does not require state survey agencies to record the type of abuse and perpetrator and, when this information is recorded, it cannot be easily analyzed. Without this information, CMS lacks key information and, therefore, cannot take actions—such as tailoring prevention and investigation activities—to address the most prevalent types of abuse or perpetrators.
- Facility-reported incidents lack key information. CMS has not issued guidance on what nursing homes should include when they self-report abuse incidents to state survey agencies. This contributes to delays in state agency investigations and the inability to prioritize investigations for quick response.
- Gaps in CMS processes can result in delayed referrals to law enforcement. CMS requires a state survey agency to make a referral to law enforcement only after abuse is substantiated—a process that can often take weeks or months. As a result, law enforcement investigations can be significantly delayed. GAO reported that delay in receiving referrals limits law enforcement’s ability to collect evidence and prosecute cases—for example, bedding associated with potential sexual abuse may have been washed, and a victim’s wounds may have healed.
The report on which the GAO testimony was based made several recommendations, including that CMS:
- require state survey agencies to submit data on abuse and perpetrator type;
- develop guidance on what abuse information nursing homes should self-report; and
- require state survey agencies to immediately refer to law enforcement any suspicion of a crime.
GAO reported that the Department of Health and Human Services concurred with GAO recommendations.
Some in the health care provider sector have raised concern about confusing definitions of the term “abuse,” pointing out that the CMS definition that applies to various types of providers differs from the definition in the Elder Justice Act of 2010, which requires nursing home reporting of certain types of incidents. As a result, while a nursing home would be obliged to report an incident under the Elder Justice Act, another type of health care provider may not be mandated to do so.
In fall 2019 another GAO report concerning abuse matters is due to be published. It is expected to compare federal abuse reporting requirements for nursing homes and assisted living residences.
Of course, it remains to be seen whether Congress or CMS will act soon to address issues raised by GAO.
In The Wharton Healthcare Quarterly, Duane Morris partner Delphine O’Rourke writes:
The high profile conflict of interest (COI) scandal at the Memorial Sloan Kettering (MSK) Cancer Center is a call to action for healthcare boards and their members to evaluate their organizations’ conflict of interest oversight. The scandal has become synonymous with egregious and ethically troubling relationships between non-profit health systems and pharma companies – even at the highest levels of one of the most prestigious healthcare institutions in the world. Almost nine months after the significant and publically scrutinized COI lapse, the preeminent New York research hospital and institution is still trying to recover from the reputational, leadership, and governance damage.
Visit the Duane Morris LLP website to read more.