Riker Danzig Health Care Update February 27, 2018
New Jersey State: Selected Proposed and Adopted Legislation
- P.L. 2017, c. 264 – Adopted – Prohibits health insurance carriers from requiring optometrists to become providers with vision care plans as condition of becoming providers in carriers’ panel of providers.
- P.L. 2017, c. 256 – Adopted – Prohibits residential substance use disorder treatment facilities and aftercare facilities from denying admission to individuals receiving medication-assisted treatment for substance use disorder.
- P.L. 2017, c. 247 – Adopted – Provides for registration and accreditation of human milk banks.
- P.L. 2017, c. 276 – Adopted – Provides sales and use tax exemption for sales of breast pumps, breast pump collection and storage supplies, and certain services to maintain and repair breast pumps.
- P.L. 2017, c. 263 – Adopted – Expands civil rights protections to include breastfeeding; requires employers to provide reasonable accommodations for breastfeeding mothers.
- P.L. 2017, c. 309 – Adopted – Requires health benefits coverage for donated human breast milk under certain conditions.
- P.L. 2017, c. 341 – Adopted – Concerns prescribing of certain controlled dangerous substances; requires practitioners to check prescription monitoring information before issuing certain prescriptions to emergency department patients; authorizes medical scribes and athletic trainers to access prescription monitoring information.
- P.L. 2017, c. 338 – Adopted – Requires electronic health records systems to meet requirements to accept, process, and transmit prescriptions for Schedule II controlled dangerous substance.
- P.L. 2017, c. 285 – Adopted – Requires anyone who is administered an opioid antidote to treat drug overdose be provided with information concerning substance treatment programs and resources.
- P.L. 2017, c. 350 – Adopted – Establishes licensure for associate marriage and family therapists.
- P.L. 2017, c. 304 – Adopted – Enters New Jersey in Physical Therapy Licensure Compact.
- P.L. 2017, c. 305 – Adopted – Requires health insurers, SHBP and SEHBP to provide coverage for digital tomosynthesis for screening and diagnostic purposes related to breast cancer.
- P.L. 2017, c. 381 – Adopted – Clarifies that authorized persons and entities may administer a single dose of any opioid antidote, or multiple doses of any intranasal or intramuscular opioid antidote to overdose victims, with immunity under “Overdose Prevention Act.”
- S. 564 – Introduced – Prohibits offering of health benefit plans in the state that do not meet certain standards; requires Commissioner of Banking and Insurance to take enforcement action against offering of plans not in compliance.
- S. 267 – Introduced – Named the “Consumer Freedom From Unwanted Expense in Health Insurance Coverage Act,” the bill provides that, notwithstanding any other law, rule or regulation to the contrary, a resident shall have the right to purchase a health insurance policy legally sold in any other state in the United States.
- S. 561 – Introduced – Named the “New Jersey Public Option Health Care Act,” the bill seeks to create a public option for New Jerseyeans to purchase health insurance.
- A. 1872 – Introduced – Establishes “New Jersey Task Force on Tiered Health Insurance Networks.”
- A. 998 – Introduced – Requires ambulatory care facilities to provide patients with list of fees charged and itemized bill upon request, with opportunity to appeal charges.
- S. 1013 – Introduced – Allows health maintenance organizations to include charity care assessments for purposes of meeting certain loss ratio requirements.
- S. 895 – Introduced – Requires managed care plans to allow any clinical laboratory to participate in provider network.
- S. 978 – Introduced – “New Jersey All-Payer Claims Database Act”; establishes New Jersey All-Payer Claims Database and arbitration process for reimbursing out-of-network health care providers.
- S. 924 – Introduced – Requires continued coverage for primary care physician services for 12 months following termination or withdrawal of physician from provider network.
- S. 956 – Introduced – Strengthens requirements for accreditation, inspection, and general oversight of “surgical practices.”
- S. 1041 – Introduced – Requires certain disclosures in advertisements by health care professionals.
- S. 1134 – Introduced – Requires managed care plans to deem valid referral for a covered health care service as satisfying requirements for prior notification.
New Jersey State: Selected Adopted Regulations
- 50 N.J.R. 283(b) – Adopted – Adopting new rules and amending rules related to reporting requirements for facilities about substance-affected infants.
- 50 N.J.R. 285(a) – Adopted – Makes amendments to the manual of requirements for residential child care facilities.
- 50 N.J.R. 522(a) – Adopted – Makes amendments to the licensure standards for hospice services.
- 50 N.J.R. 528(a) – Adopted – Makes amendments to the hospital licensing standards by amending N.J.A.C. 8:43G-1.2 and adding new rule N.J.A.C. 8:43G-11A to address discharge planning and designated caregivers.
- 50 N.J.R. 531(a) – Adopted – Makes amendments to hospital licensing standards by specifically adopting a new rule related to sepsis infection protocols.
- 50 N.J.R. 564(a) – Adopted – These regulations pertain to impermissible practices related to plan claims processing by health maintenance organizations and the timing of authorization of services and payment of claims by such organizations.
- 50 N.J.R. 571(a) – Adopted – This changes the regulations under N.J.A.C. 11:22, which pertain to the prompt payment of claims by carriers.
- 50 N.J.R. 575(a) – Adopted – Makes amendments to N.J.A.C. 11:24-1.2, 11:24A-1.2 and 11:24A-2.3, which relate to the Health Care Quality Act’s application to insurance companies, health service corporations, hospital service corporations and medical service corporations.
- 50 N.J.R. 259(c) – Public Notice – Notice of cancellation of need call for new home health agencies based on Department of Health’s determination that there is not a sufficient need for additional new home health agencies at this time.
- 50 N.J.R. 260(a) – Public Notice – Notice of certificate of need call for new specialized long-term care beds for pediatric care based on Department of Health’s determination that there is a limited need for new specialized long-term care beds for certain regions of the state.
- 50 N.J.R. 260(b) – Public Notice – Notice of certificate of need call for new specialized long-term care beds for severe behavior management based on Department of Health’s determination that there is a limited need for additional new facilities in certain regions of the state.
Federal: Selected Proposed and Adopted Regulations
- 83 FR 239-01 – Adopted – This final rule makes changes to the Substance Abuse and Mental Health Services Administration’s (SAMHSA) regulations governing the confidentiality of substance use disorder patient records. Specifically, among other things, SAMHSA finalized changes to clarify the payment and health care operations activities for which lawful holders may disclose patient-identifying information to their contractors, subcontractors, and legal representatives. In addition, SAMHSA clarified that the audit and evaluation provision permits certain disclosures to contractors, subcontractors, and legal representatives for purposes of carrying out an audit or evaluation under § 2.53.
- 83 FR 1004-01 – Proposed – This request for information seeks public comment regarding several items related to Clinical Laboratory Improvement Amendments of 1988 (CLIA) personnel requirements and histocompatibility requirements, which, with minor exception, have not been updated since 1992. CMS is also seeking public comment regarding the flexibility to impose alternative sanctions for laboratories issued a Certificate of Waiver (CoW) determined to have participated in proficiency testing (PT) referral. In addition, CMS is seeking public comment related to appropriate sanctions in situations where CMS determines that a laboratory has referred its PT samples to another laboratory and has reported the other laboratory’s results as their own.
Federal: Selected Proposed Legislation
- H.R. 4710 – Introduced – Amends the Public Health Service Act to establish a moratorium on the registration of certain new 340B hospitals and associated sites.
- The New Jersey Appellate Division recently published an opinion regarding the application of New Jersey’s Charity Care program to certain types of admitted patients. Specifically, the Charity Care regulations have historically provided a distinction between patients admitted to the emergency room and patients admitted from other areas. In the former case, the onus was and remains on the hospital or facility to acquire the necessary paperwork to receive payment from the Charity Care program. In the latter circumstance, however, the patient has traditionally borne the responsibility of getting together the necessary paperwork to get payment covered by the Charity Care program. The Appellate Division ruled, however, in a case involving a person who was admitted involuntarily for psychiatric reasons that these types of patients, i.e. patients admitted to short-term care facilities for psychiatric emergency screening services, are just as unable to provide necessary paperwork for entitlement to Charity Care assistance as those admitted to a traditional emergency room setting. As such, the Court reasoned that such patients should be afforded the same protections. For more information on the suit, see, Newton Medical Center v. D.B., 2018 WL 480296 (App. Div. Jan. 17, 2018).
Federal/Other State Litigation
- A Florida hospital, The Florida Health Sciences Center, Inc., also known as Tampa General Hospital, recently filed suit in a Florida federal district court against the U.S. Department of Health and Human Services to get a declaratory ruling as to its obligation to produce “adverse incident reports” in a state court malpractice action. The hospital argues that it believes such records are protected from release by the federal Patient Safety and Quality Improvement Act (“PSQIA”). However, a recent Florida Supreme Court decision, S. Baptist Hosp. of Fla. Inc. v. Charles II, arguably requires the records’ production. As such, the hospital seeks a clarification as to the scope of the PSQIA and seeks to avoid civil monetary penalties under the PSQIA in the event that production of the “adverse incident reports” is ordered. For more on the suit, see, Florida Health Sciences Center Inc. et al. vs. Alex Azar, secretary of the U.S. Department of Health and Human Services et al., case number 8:18 -cv- 00238, filed in the U.S. District Court for the Middle District of Florida.
- The Fifth Circuit recently reversed two health care fraud and conspiracy convictions for a Louisiana-based doctor and home health care operator based on an insufficient showing of evidence by the DOJ. Specifically, the Court found it “peculiar” that the DOJ relied primarily on cooperation from a doctor and two nurses who operated separately from the defendants. “Usually,” the Court stated, “the government presents a co-conspirator who was involved in the specific conspiracy charged. Here no such person exists.” Based on the absence of this sort of evidence, the Court held that the jury verdict could not stand. For more information on the suit, see, USA v. Pramela Ganji et al., case number 16-31119, before the U.S. Court of Appeals for the Fifth Circuit.
- A New York federal district court judge recently reversed her earlier decision and reinstated claims brought by customers of Excellus BlueCross BlueShield in relation to a 2015 data breach. In her earlier decision, the judge had ruled that the plaintiffs had failed to allege an injury sufficient for standing where they had pled only that their data had been exposed, but not misused. Based on new evidence obtained by plaintiffs and case law subsequently developed by the Second Circuit, the judge ruled that these plaintiffs had standing based on the implied import of a Second Circuit opinion that the Second Circuit would find standing for persons whose personally identifying information has been exposed, because they are at increased risk of identity theft. For more information on the suit, see, Fero et al. v. Excellus Health Plan Inc. et al., case number 6:15-cv-06569, in the U.S. District Court for the Western District of New York.
- The Third Circuit recently ruled that a whistleblower suit alleging Medco Health Solutions Inc. violated the False Claims Act by engaging in a kickback scheme that involved using donations to nonprofit groups to secure recommendations to patients could not proceed without establishing a link between the scheme and the Medicare and Medicaid patients whose claims the government reimbursed. For more information on the suit, see, Steve Greenfield v. Medco Health Solutions Inc. et al., case number 17-1152, in the U.S. Court of Appeals for the Third Circuit.
- A California appellate court recently ruled that the state medical board could use evidence from an arrest report to justify censuring a doctor accused of cocaine possession. Specifically, the court held that state law provided a “blanket exception” to the usual safe harbor for people who completed drug diversion programs when the person in question is a doctor. For more information on the suit, see, Medical Board of California v. Superior Court of the City and County of San Francisco, case number A151175, in the Court of Appeal for the State of California, First Appellate District.
- Under the ever-growing body of case law that has sprung from the U.S. Supreme Court’s landmark decision in Universal Health Services v. Escobar, a Florida federal court judge recently ruled to reverse a roughly $350 million False Claims Act verdict against a nursing home operator, stating that there was not evidence the government would have declined payment if aware of alleged billing violations. Specifically, the Escobar decision found that continued government reimbursement after fraud allegations emerge is “very strong evidence” that the allegations are not material. As, in this case, the government continued to pay and still pays to this day despite the disputed practices, the judge reasoned the allegations were not material enough to uphold the verdict. For more on the case, see, U.S. ex rel. Ruckh v. CMC II LLC et al., case number 8:11-cv-01303, in the U.S. District Court for the Middle District of Florida.
- The Fifth Circuit recently reversed a prior win for Humble Surgical Hospital, LLC in a suit brought against the entity by Cigna related to ERISA and the Anti-Kickback Statute. Specifically, the Fifth Circuit held that Cigna had not violated ERISA and, therefore, was not required to pay penalties to Humble on its § 502(c) claim. While the Court did not address the ultimate merits of Cigna’s claims that Humble violated the Anti-Kickback Statute, the Court did hint that had Cigna proved the materiality of these violations that the District Court would have abused its discretion in not reviewing the evidence Cigna tried to present. This decision is more in line with a prior case brought by Aetna against Humble in which Aetna succeeded against Humble. For more information on these two suits, see, Aetna v. Humble Surgical Hospital, LLC, 2016 WL 7496743 (S.D. Tex. Dec. 31, 2016) and Cigna v. Humble Surgical Hospital, LLC, 878 F.3d 478 (5th Cir. 2017).
In the News
- The FTC’s Office of Policy Planning, Bureau of Economics and Bureau of Competition recently responded to a request for comment from a Pennsylvania state legislator regarding a bill proposed in Pennsylvania that would allow qualified nurses to practice and prescribe medication on their own after working with a doctor for three years. H.B. 100, as presently proposed, would allow the State Board of Nursing to let advanced practice registered nurse-certified nurse practitioners, or APRN-CNPs, work independently as long as they have spent three years and 3,600 hours working under a collaborative agreement with a doctor. The FTC’s response was that the bill would likely benefit competition and anyone seeking health care in Pennsylvania.
- The U.S. Department of Labor recently issued a proposed rule that would let more employers avoid ERISA’s stricter rules for small group and individual insurance plans by joining together instead to form so-called association health plans. The proposed rule, which was directed by an October executive order, would let businesses in the same industry or geographic area form health care associations subject to ERISA’s looser restrictions on health plans serving large groups of workers, even permitting these associations to be formed across state lines. The thought behind the rule is that it will allow more businesses to pool their resources into a single health plan.
- On January 25, 2018, the DOJ released a memo concerning the legal relevance of other agencies’ guidance documents in affirmative civil enforcement (ACE) cases. Previously, on November 16, 2017, the DOJ had issued a memorandum prohibiting DOJ components from issuing guidance documents that effectively bind the public without undergoing the notice-and –comment rulemaking process. Under that guidance policy, the DOJ may not issue guidance documents that purport to create rights or obligations binding on persons or entities outside the Executive Branch, or to create binding standards by which the Department will determine compliance with existing statutory or regulatory requirements. Commensurate with this guidance policy, in the January 25, 2018 memo, the DOJ stated that: (1) guidance documents from other agencies cannot create binding requirements that do not already exist by statute or regulation; (2) effective immediately the DOJ may not use its enforcement authority to effectively convert agency guidance documents into binding rules; and (3) DOJ litigators may not use noncompliance with guidance documents as a basis for proving violations of applicable law in ACE cases. The DOJ now should not treat a party’s noncompliance with an agency guidance document as presumptively or conclusively establishing that the party violated the applicable statute or regulation.
The list above does not include every proposed or adopted legislation, litigation or guidance document that may impact the health care industry. Instead, it includes only a select few chosen by the authors, and any information in this Update is not intended to provide legal advice. If you are concerned that a proposed or adopted legislation, litigation or guidance document may impact your practice, then you should seek legal advice. We send these Updates to our clients and friends to share our insights on new developments in the law. Nothing in this Update should be relied upon as legal advice in any particular matter. © 2018 Riker Danzig Scherer Hyland & Perretti LLP.
If you have any questions about the issues discussed in this Update, please contact the following Riker Danzig attorneys:
Glenn A. Clark, Partner
Khaled John Klele, Partner
Stephen M. Turner, Associate