Executive Orders Issued by the Trump Administration Regarding the Inappropriateness of Guidance Documents

Two Executive Orders: 84 FR 55235 and 84 FR 55239

Following SCOTUS’ ruling in Azar v. Allina Health Services reported by us here, in which the Court invalidated CMS’ Part C policy for failure to comply with  notice and comment rulemaking before applying the policy, the executive orders issued by the Trump Administration on October 9, 2019 “Promoting the Rule of Law Through Improved Agency Guidance Documents” and “Promoting the Rule of Law Through Transparency and Fairness in Civil Administrative Enforcement and Adjudication” are both aimed at transparency in the regulatory process and to curtail guidance documents from being improperly used by agencies in lieu of following public notice-and-comment mandates of the Administrative Procedure Act. 

Health Law Developments

New Jersey State Regulatory Issues

51 N.J.R. 1493(a) – Proposed Regulation – This proposal establishes the County Option Hospital Fee Pilot Program. The purpose of the pilot program is to increase financial resources through the Medicaid/NJ FamilyCare program to support local hospitals in providing necessary services to low-income residents. The pilot program will be in effect for a period of five years from April 30, 2019 through April 30, 2024.   Each participating county can impose a local health care-related fee on hospitals within its borders. 

Significant Recent Regulatory and Statutory Developments

New Stark and Anti-Kickback Exceptions: Just yesterday, the Department of Health and Human Services issued proposed rules that have yet to be published in the federal registry, that loosen the prohibitions in the Stark Law and Anti-Kickback Statute to include new exceptions centered on value-based arrangements.  The OIG drafted the proposed rule regarding the Anti-Kickback Statute and CMS drafted the proposed rule regarding the Stark Law. 

FDA Releases New Guidance

On September 27, 2019, the Food and Drug Administration (FDA) released new guidance, replacing the December 2017 guidance, regarding clinical decision support (CDS) software. The new guidance expands the scope of the agency’s control of CDS software developed for providers, patients, and caregivers and clarifies which kind of software no longer is considered to be a medical device under the law. 

Two Recent OIG Advisory Opinions

As technology continues to be a pervasive platform for the healthcare industry in improving patient care, the Office of Inspector General of the Department of Health and Human Services (OIG) posted Advisory Opinion 19-04 which approved a technology company’s proposal to make visible to federal health care program beneficiaries its online healthcare directory for searching and booking medical appointments and sponsored advertisements. 

D.C. Circuit Court of Appeals Reinstates 2017 DSH Rule to Include Third Party Payments in DSH Calculation

The debate over the methodology to calculate Disproportionate Share Hospital (DSH) reimbursement to hospitals continues. In June, we updated you on Azar v. Allina Health Services when the Supreme Court vacated an HHS policy requiring DSH hospitals to include Medicare Part C enrollees in their Medicare fraction because HHS did so without going through the notice and comment period set by the Medicare Act for a substantive legal change.