On January 1, 2022, the updated Code on Interactions with Health Care Professionals, published by the Pharmaceutical Research and Manufacturers of America (PhRMA), became effective. The updates reflect fraud and abuse concerns voiced by the Department of Health and Human Services’ Office of Inspector General in its November 2020 Special Fraud Alert. While it is not a legal document, companies that adopt the code’s rules are more likely to comply with federal fraud and abuse laws like the Anti-Kickback Statute.
To read the full text of this Duane Morris Alert, please visit the firm website.
By Erin M. Duffy and Samantha Dalmass
A federal judge in New Orleans blocked the Interim Final Rule with Comment requiring the vaccination of all staff of health care facilities subject to the health and safety standards under the Medicare Conditions of Participation (“CoPs”) issued by the Centers for Medicare and Medicaid Services (“CMS”) earlier this month. The nationwide block was issued on November 30, 2021, less than one week before the December 6, 2021 deadline for all staff of covered facilities to have received at least their first dose of a two-dose COVID-19 vaccine series, and only one day after a federal court in Missouri blocked the CMS vaccination requirement in Missouri, Arkansas, Alaska, Iowa, Kansas, Nebraska, New Hampshire, North Dakota, South Dakota, and Wyoming.
Notwithstanding the broad authority of CMS to regulate the health and safety of facilities subject to Medicare CoPs, the order issued by the U.S. District Court for the Western District of Louisiana blocking implementation of the CMS mandate set forth in 86 Fed. Reg. 61555-01 (November 5, 2021) will remain in effect pending final resolution of the case. The Biden Administration will likely appeal to the Supreme Court, but in the meantime facilities covered by the mandate should plan accordingly and ensure they are prepared to implement the required plans and processes for vaccinating staff, providing exemptions and accommodations for those who are exempt, and tracking and documenting staff vaccinations.
Providers in the long term care industry often ask me whether they should sign on with their local accountable care organization (“ACO”). My answer has always been, for years now, absolutely! After all, ACOs can be a good source of referrals for skilled nursing. Plus, a team-oriented ACO can foster better patient care, quality care and wellness in the ACO setting in the community. However, more of our skilled nursing facility clients have been experiencing problems with certain ACOs operating as dictatorships. Perhaps this is because more and more skilled nursing facilities are finally entering the realm of ACO involvement.
While it is good for a skilled nursing facility to be on the ACO’s “A List” of skilled nursing home providers, skilled nursing facilities need to carefully review their contracts with ACOs to make sure they are not taken advantage of or subject to increased liability. For example, recently one skilled nursing facility relationship with its ACO was so strained that it fired its ACO due to problems with patient care. See Alex Spanko, “How One Skilled Nursing Operator Navigates The Occasional Single ‘Dictatorship’ of ACOs,” Skilled Nursing News, October 16, 2019. In some cases, there were reports that ACOs are placing too much pressure on skilled nursing facilities to discharge residents earlier than indicated, or forcing facilities to provide less care in order to reduce ACO costs, often times to the detriment of residents. Continue reading “Skilled Nursing Facilities, Beware of ACOs”
By Patricia S. Hofstra
The enforceability of non-competition clauses depends on a number of factors. Non-competition clauses are viewed in the context of anti-trust laws as a restraint of trade and disfavored. Consequently, the entity seeking to enforce a non-compete must be able to prove a legitimate business reason for the non-compete. A number of states flat out prohibit non-competition agreements, while other states enforce non-competition agreements on a case by case basis. In some states where non-compete provisions that restrict the physician’s right to practice medicine are considered void and not enforceable as a matter of law, employers may be able to sue the departing physician for monetary damages suffered because of the competition. Continue reading “Non-Competition Clauses – Make No Assumptions”
On February 5, 2018, the Government Accountability Office, a nonpartisan investigative arm of Congress, found that there are huge gaps in regulation of assisted living facilities. The report, entitled “Medicaid Assisted Living Services: Improved Federal Oversight of Beneficiary Health and Welfare is Needed,” comes on the heels of years of discussion as to whether assisted living facilities are sufficiently regulated by individual states, or whether further federal oversight is warranted.
The suggestion of the need for federal regulation of assisted living came from GAO’s finding that more than $10 billion a year is spent from federal and state funds for assisted living services for more than 330,000 Medicaid beneficiaries. With demand for additional Medicaid assisted living funding, and the potential increase in demands of the senior population in the next 5 years, these numbers will continue to rise significantly as noted by the GAO: “Medicaid spending on long-term care is significant, representing about one quarter of Medicaid spending annually and is expected to grow with an aging population.” Continue reading “GAO Report: Assisted Living Providers & Federal Regulation”
In January 2018, The Office of the Auditor General for the State of Illinois published its Performance Audit (“Audit Report”) of Medicaid Managed Care Organizations (“Medicaid MCOs”) for Fiscal Year 2016. What was unleashed was a startling review of the Medicaid MCOs’ performance over FY 2016 in administering the Medicaid Program for what was then called the Integrated Care Program (“ICP”) or Medicare/Medicaid Alignment Initiative (“MMAI”) Programs. You may recall these ICP and MMAI Medicaid MCO programs in Illinois involved almost a dozen Medicaid MCOs that covered about 70% of the State of Illinois Medicaid recipients.
The Audit Report played into health care providers’ deepest fears in Illinois: showing that Medicaid Managed Care may not be working as it was intended; namely, to reduce costs and improve quality of care in the Medicaid Program in Illinois. For example, long term care providers in Illinois had to fight tooth and nail with Medicaid MCOs under the ICP and MMAI programs, experiencing cumbersome Medicaid contracts, denied claims, delayed claims, and worse yet, a prior authorization administration problem (administrative MCO delay) which in some instances prevented residents from receiving care timely. Most, but not all, of those issues are still being resolved, but providers had hoped that there was a good reason for this madness involving Medicaid MCOs: better and lower cost care for Medicaid beneficiaries. Continue reading “Illinois Posts Medicaid Managed Care Performance Report”
In the Spring 2015 edition of The Wharton Healthcare Quarterly, Duane Morris partner Lisa Clark’s article, “Affidavit: Healthcare and the Law – Healthcare Reform Update: What’s in a Name?,” discussed the innovations under the Affordable Care Act (ACA). One of the innovations was the Accountable Care Organization (ACO), where a new healthcare reimbursement system was introduced as an alternative to the tradition fee-for-service model. Over the years, the Accountable Care Organizations and other value-based models will be tested and hopefully, there will be buzz around this new model in the next year.
On April 20, 2015, the Department of Health and Human Services Office of Inspector General (“OIG“) published its “Practical Guidance for Health Care Governing Boards on Compliance Oversight” (the “Guide“). The Guide was prepared in collaboration with the Association of Healthcare Internal Auditors, the American Health Lawyers Association, the Health Care Compliance Association, and according to the Guide, provides tips to health care boards (“Boards“) on four categories: “(1) roles of, and relationships between, the organization’s audit, compliance, and legal departments; (2) mechanism and process for issue-reporting within an organization; (3) approach to identifying regulatory risk; and (4) methods of encouraging enterprise-wide accountability for achievement of compliance goals and objectives.” While not a legally binding document, the Guide provides helpful insight for Boards and underscores best practices in these areas. Continue reading “OIG Issues Guide For Health Care Boards on Compliance Oversight”
A recent settlement between Mayo Collaborative Services d/b/a Mayo Medical Laboratories (“MML”) and Mayo Clinic (together with MML, “Mayo”) and a former Mayo executive, Dr. Franklin Cockerill, reveals the potential legal issues that may arise when health care executives seek new employment and the high stakes litigation that may ensue-regardless of which party may or may not be at fault.
As set forth in Mayo’s complaint, Dr. Cockerill was a former senior officer and director of MML and Chair of the Mayo Clinic Department of Laboratory Medicine and Pathology, where he managed several thousand medical professionals handling laboratory testing and intellectual property development for Mayo and MML. According to Mayo’s complaint, as a result of Dr. Cockerill’s various positions he had first-hand knowledge of confidential strategic, business, marketing, sales, pricing, and data management information from MML and Mayo. Eventually, Dr. Cockerill retired and obtained employment with a Mayo competitor.
Continue reading “Mayo Lawsuit Against Former Exec Raises Numerous Health Care and Business Litigation Issues”
One arrow in the quiver for healthcare providers sued for violations of false claims and anti-kickback statutes is pressing for discovery from the whistleblower/relator, including a deposition of the relator. The failure of the whistleblower to comply with the discovery obligations could result in meaningful sanctions, including dismissal.
In Guthrie v. A Plus Home Health Care, Inc. et al, 0:12-cv-60629-WPD (S.D. FL), the relator, William Guthrie, sued a home health care provider, its seven doctors, and their spouses, alleging that the doctors and their spouses implemented a fraudulent scheme of compensation and referral payments resulting in violations of the False Claims Act, the Stark Act, and the federal Anti-Kickback Statute. Continue reading “False Claims and Anti-Kickback Defendants Should Insist on Discovery from the Whistleblower/Relator”