The rule proposed by the Centers for Medicare and Medicaid Services (CMS) would require that all facilities licensed as hospitals within their respective states (including the District of Columbia, Puerto Rico, the Virgin Islands, Guam, American Samoa, and the Northern Mariana Islands) disclose their “Standard Charges.” The rule would define “Standard Charges” as the hospital’s gross charge for an item or service as well as the charges that it negotiates with insurance companies and other payors. The rule would require hospitals to publish these “Standard Charges” for at least 300 shoppable services, with the rule defining a “shoppable service” as one that can be scheduled by a healthcare consumer in advance. These pricing disclosures—subject to annual updates—would be required to appear prominently on publicly available websites.
President Trump, who signed an executive order last month calling for changes that would allow healthcare consumers to compare prices for shoppable services, argues that the disclosed price discounts would enhance transparency and enable consumers to make informed, educated choices. The healthcare industry has already voiced opposition to this plan by arguing that the discounted rates are trade secrets or that they promote competition.
A few months ago, the Trump administration made headlines when it took another step aimed at lowering the cost of healthcare; that time, the administration announced a new rule that would require pharmaceutical companies to disclose the prices of prescription drugs in television commercials. The response, by the pharmaceutical industry, was swift, raising a number of arguments in opposition, including that the rule would confuse the public. According to the industry, there would be no practical way to disclose the “price” of a given drug, because different end-user consumers pay different out-of-pocket costs based on varying co-insurance requirements, co-pays, etc. The drug industry also argued that the required disclosure would violate First Amendment free speech protections, and further insisted that the Department of Health and Human Services (HHS) didn’t have the authority to force the pharmaceutical companies to publish their prices in their ads. In that case, pharmaceutical industry representatives, including a number of manufacturers, as well as the Association of National Advertisers, filed suit against the Trump administration to block the rule from taking effect. A federal court sided with the industry, blocking the initiative on the grounds that HHS lacked the requisite regulatory power.
Whether the negotiated rate proposal from CMS will face the same fate as the HHS advertising proposal is unclear. Stakeholders are encouraged to submit comments to the agency. The deadline for comment submission is September 27, 2019.
This blog post was co-authored by Justin M. L. Stern and Ryan Wesley Brown.
Neville M. Bilimoria
With all the regulatory changes facing nursing homes these days, it is no wonder most are behind in the world of compliance. It seems nursing homes are constantly berated with new regulations and more issues to deal with on a daily basis. The recent article in the May 22, 2017 edition of Modern Healthcare was, therefore, not a surprise: “Regulation: Nursing homes and hospice providers face looming emergency preparedness deadline.”
The article discusses the real November 15, 2017 deadline for nursing homes to comply with the emergency preparedness regulations promulgated by the Centers for Medicare & Medicaid Services (“CMS”) in September 2016. The article further discusses how most facilities are not close to complying by the November 15, 2017 deadline. The problem is that while nursing homes have historically had some emergency preparedness policies and procedures, the new CMS rules impose more robust policies, procedures, and mechanisms to be in place prior to November 15, 2017. That would require nursing homes to partner with local hospitals, police and fire departments to make sure their preparedness plans are up to date, robust, and systematically applied. The rules mandate, among other things, back-up generator contingencies, cybersecurity attack back up plans, and widespread training on a myriad of emergency preparedness policies and procedures that need to be developed by nursing homes. The rules even require disaster drills to be conducted by the nursing home in conjunction with local emergency response agencies.
Continue reading Nursing Homes Ready For Emergency Preparedness Rules?
In a 5-3 decision today, the Supreme Court of the United States in Whole Woman’s Health v. Hellerstedt, No. 15-275, slip op. (June 27, 2016) reversed a decision of the Fifth Circuit and overturned as unconstitutional a Texas law that (1) required abortion providers to have “active admitting privileges” at a hospital within 30 miles of the location at which they provide abortions and (2) required abortion facilities to meet standards adopted for ambulatory surgery centers. The Court wrote that each of the requirements “places a substantial obstacle in the path of women seeking a previability abortion, each constitutes an undue burden on abortion access, and each violates the Federal Constitution.” A team of Duane Morris attorneys, including Philip H. Lebowitz, Erin M. Duffy, Katharyn I. Christian McGee, Alison Taylor Rosenblum, and Erica Fruiterman, filed an amicus curiae brief on behalf of medical staff professionals in support of petitioners Whole Woman’s Health et al. In its decision, the Supreme Court cited Duane Morris’ amicus brief, noting, “Other amicus briefs filed here set forth without dispute other common prerequisites to obtaining admitting privileges that have nothing to do with ability to perform medical procedures.” The brief was one of only a handful of amici curiae briefs cited in the decision out of a total of 41 such briefs filed on behalf of petitioners.
Recently, the American Hospital Association published in its newletter Trendwatch a detailed 16 page article entitled “The Role of Post-Acute Care in New Care Delivery Models,” December 2015. The article discusses what we have been trying to tell our post-acute care, especially nursing home clients, for years: become a valued partner of an Accountable Care Organization (“ACO”) and be ready to show your value to those ACOs, or continue to operate as you historically have at your own peril.
When ACOs first started, there was virtually no room or focus on long-term care providers being involved in an ACO. Some hospitals talked initially about home health care, but very little discussion was geared towards long-term care providers being in an ACO network because hospitals did not understand the long-term care environment. Continue reading ACOs Waking Up to the Value of Post-Acute Care Providers
Duane Morris partner Patricia S. Hofstra will be speaking at the Strafford Live Webinar on “Retail Clinics in Healthcare: Overcoming Complex Legal Challenges” to be held on Thursday, March 10, 2016 from 1:00 p.m. to 2:30 p.m. (Eastern time). The webinar will address “Complying with Corporate Practice of Medicine, Licensure, and Scope of Practice Laws; Navigating Emerging Relationships with Physicians, Hospitals and Payers.”
For more information, please see the event page on the Duane Morris website.
Health systems attempting to fulfill the mandate of integrating hospitals and physicians may find themselves accused of going too far. Although the Affordable Care Act, shared savings, gainsharing and other alternative payment methodologies have made integration of physicians, hospitals and other providers an operational goal, success in reaching that goal may be challenged by private antitrust actions.
In a recent Florida federal court decision, the antitrust complaint of “several of Southern Brevard County’s physicians and physicians practice groups” was held to have stated a monopolization claim against Health First, Inc. and three of its wholly-owned subsidiaries — an insurer, a hospital and a physician practice group. Essentially, by fully integrating its business, and incentivizing in-network referrals and managed care pricing, Health First became vulnerable to claims of tying, exclusive dealing, price discrimination and monopolization.
Continue reading Health System Integration and Antitrust Laws on Collision Course
Duane Morris special counsel Michael E. Clark of the firm’s Houston office, is quoted in “AHA Lawsuit over ‘Two-Midnight’ Rule Called Uphill Battle,” which appeared in Modern Healthcare on April 15, 2014.
No matter how strong their legal arguments, hospitals will have a tough time convincing judges to overturn Medicare’s controversial new rules on classifying inpatients, some legal experts say.
Continue reading Duane Morris’ Michael E. Clark Quoted in Modern Healthcare
The meaningful use (MU) regulations provide incentive monies for hospitals and physicians that establish electronic health records systems (EHRs) and satisfy other criteria, such as providing new forms of ‘patient engagement’ like technologically-enabled patient-provider communications. The advantages of a wireless record-sharing are enormous – quicker diagnoses, better quality tracking, and seamless payment systems. But there are lots of steps and decisions required in setting up EHRs and developing broader data exchange systems like health information organizations/exchanges (HIOs or HIEs). Last week, the Department of Health and Human Services’ Office of the National Coordinator denied certification for two small EHRs and promised ongoing rigorous enforcement of EHRs. Continue reading Electronic Health Records and Health Information Exchanges/Organizations: The Changing Landscape
Those of us who have been in the health care industry for awhile have seen hospital employment of physicians come and go several times. In my early years as a health care attorney, I was an in-house counsel in the hospital industry. I represented hospitals in the rush to jump on the band wagon of physician employment. I am now in the private practice of law and while I continue to represent hospitals, I also represent physicians and physician groups exploring various relationships with hospitals including employment.
Continue reading Hospital Employment of Physicians
Summary: This regulation was adopted in order to correct technical errors that were identified in two documents regarding hospital outpatient prospective payment: a final rule and its subsequent correction document. The final rule containing errors is titled “Medicare Program: Changes to the Hospital Outpatient Prospective Payment System and CY 2010 Payment Rates; Changes to the Ambulatory Surgical Center Payment System and CY 2010 Payment Rates.” The subsequent correction document also containing errors is titled “Medicare Program: Changes to the Hospital Outpatient Prospective Payment System and CY 2010 Payment Rates; Changes to the Ambulatory Surgical Center Payment System and CY 2010 Payment Rates” Continue reading Changes to the Hospital Outpatient Prospective Payment System (OPPS) and CY 2010 Payment Rates