New Jersey and Federal Legislative Update

New Jersey Statutes:

A3717 – Approved – We previously reported on this statute, which initially passed both houses, but was then vetoed by the Governor.  After some modifications, the statute passed both houses again and became law after excluding self-insured plans, the State Health Benefits Plan, and the School Employees Health Benefits Plan.  The statute prohibits a pharmacy benefits manager from retroactively reducing payments on a properly filed claim for payment by a pharmacy.

Legislative and Litigation Update

New Jersey State Regulatory Issues

51 N.J.R. 1806(a) – Notice of Action on Petition for Rulemaking

The Department of Health received a petition to make amendments to N.J.A.C. 8:43G, the Hospital Licensing Standards, in Subchapter 14 Infection Control, at N.J.A.C. 8:43G-14.9, Sepsis protocols.  We previously reported that the Department confirmed receipt of the petition.  At this time, the Department has not decided on the petition and has referred the petition to the Division of Certificate of Need and Licensing to evaluate, and make recommendations as to the appropriateness of granting the petition.

Eleventh Circuit Raises the Bar on the False Claims Act.

The Eleventh Circuit dealt a win for providers in United States v. AseraCare, ruling that a mere difference of clinical opinion among physicians is not enough to prove “falsity” under the False Claims Act.  The Eleventh Circuit’s decision emphasizes that reasonable differences of opinion between physician reviewers of medical documentation are not sufficient to suggest that the judgments concerning a particular patient’s eligibility for Medicare’s hospice benefit, or any claims submitted based on such judgments, are false for purposes of the False Claims Act.

Anticipated Federal Hospital and Payor Transparency Rules

As we previously reported, on November 15, 2019, CMS issued a final rule and comment period that revises the Medicare hospital outpatient prospective payment system (OPPS) and the Medicare ambulatory surgical center (ASC) payment system for Calendar Year 2020. In that final rule, CMS made clear that it intends to continue with its policy to require hospitals to publicly disclose "standard charges," including payer-specific negotiated rates.  CMS, however, did not actually publish the final rule in the registry and, instead, CMS stated it “received over 1,400 comments on our proposed requirements for hospitals to make public their standard charges.

Federal Regulatory Update

Ambulatory Surgery Center Prospective Payment System

84 FR 61142 – Final Rule with Comment Period – This final rule with comment period revises the Medicare hospital outpatient prospective payment system (OPPS) and the Medicare ambulatory surgical center (ASC) payment system for Calendar Year (CY) 2020.  On average for all covered procedures in ASCs, payment rates went up by 2.6%.

New Federal and State Regulations and CMS Alleged Overpayments

New Jersey State Regulation Expanding Graduates of International Medical Schools

51 N.J.R. 1597(a) – Proposed Regulation -- This proposal by the State Board of Medical Examiners (Board) is to update the eligibility requirements for graduates of international medical schools who seek licensure or authorization to engage in the practice of medicine as residents.  If approved, the proposed amendments would allow the Board to rely on recognized accrediting bodies for international medical schools that adhere to standards substantially similar to the bodies that currently accredit domestic medical schools. 

Federal Regulatory Update and Recent Litigation

Federal Regulatory Update:

The Department of Health and Human Services (HHS) recently published 84 FR 59549, requiring annual inflation-related increases to the civil monetary penalties associated with the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015 (the Act).  The Act aims to improve the effectiveness of civil monetary penalties and to maintain a deterrent effect against violations of federal statutes or regulations.