New Jersey and the Federal Government continue to revise statutes and regulations to address COVID-19. Our updates continue to focus on these revisions. For example, New Jersey is currently considering a law that delays, for nine months, the assessment that Ambulatory Surgery Centers must pay by June 15. Any Center, however, should not wait until June 15 to determine if the law passes. Call the Department of Health and ask for an extension to pay the assessment.

For more information about this blog post, please contact Khaled J. Klele, Ryan M. Magee, or Labinot Alexander Berlajolli.

STATE UPDATE

Recent Proposed and Adopted Laws

A4201 – Proposed– This bill delays the Ambulatory Surgery Center assessment due on June 15, 2020 for nine months to be paid in full by March 15, 2021.

A3942 – Approved – This bill requires hospitals to permit a pregnant woman to have at least one individual accompany her during the period of labor and delivery in the room of the hospital where the woman gives birth.  The bill takes effect immediately and was passed, in part, because hospitals were preventing individuals from accompanying pregnant woman in delivery rooms because of COVID-19.

S2344 – Approved – This bill requires state Medicaid and NJ FamilyCare programs and insurance carriers in the State, during the public health emergency, to provide coverage for prescription drug refills, not to exceed a 120-day supply, even when the covered person has not yet reached the scheduled refill date, provided that the prescription itself would remain valid beyond the refill date.  The coverage shall be provided based on the authorization for the most recently filled prescription and additional authorization for the refill shall not be required.

OIG Report on New Jersey’s MCOs

The Office of Inspector General of the Department of Health and Human Services (“OIG”) recently issued a report on New Jersey’s failure to ensure that its managed care organizations (MCOs) properly managed long-term services and support (MLTSS) available to Medicaid beneficiaries in home and community-based settings. For 68 of the 100 monthly capitation payments in the OIG’s random sample, the OIG found that MCOs did not comply with the requirements to adequately assess and cover the associated beneficiaries' needs for long-term services and supports.  The OIG also determined that the MCOs' failures could have resulted in beneficiaries not getting the services that they needed and may have put their health and safety at risk. According to the OIG, New Jersey made monthly payments totaling approximately $386 million (federal share) to MCOs that did not comply with certain federal and State requirements.

FEDERAL UPDATE

Increased Access to Telehealth for Medicare Beneficiaries

85 FR 33796 – Final – the Centers for Medicare & Medicaid Services ("CMS") recently finalized a rule that provides better coverage and increases access to telehealth for seniors in Medicare Advantage (MA) plans.  As part of CMS’s ongoing efforts to advance telehealth, the rule provides MA plans with more flexibility to count telehealth providers in certain specialty areas, such as dermatology, psychiatry, cardiology, ophthalmology, nephrology, primary care, gynecology, endocrinology, and infectious diseases.  The rule also reduces the percentage of beneficiaries that must reside within the maximum time and distance standards in non‑urban counties from 90 percent to 85 percent.  CMS issued a fact sheet summarizing the major provisions of the final rule.   The final rule is effective August 3, 2020.

Health and Human Services Issues a Final Rule on Enforcement Discretion

85 FR 29367 – Final Rule – Health and Human Services (HHS) issued a final rule exercising its discretion in how it applies the Privacy, Security, and Breach Notification Rules under HIPAA. As a matter of enforcement discretion, HHS’s Office for Civil Rights (OCR) will not impose penalties for noncompliance with the regulatory requirements under the HIPAA Rules against covered healthcare providers or their business associates in connection with the good faith participation in the operation of a COVID-19 Community-Based Testing Site during the public health emergency. The notification of enforcement discretion was effective on April 9, 2020, and had a retroactive effect to March 13, 2020, and will remain in effect until the Secretary of HHS declares that the public health emergency no longer exists.

CMS Guidance for Reopening Nursing Homes

CMS has released recommendations for reopening nursing homes to help State and local officials determine the level of mitigation needed to prevent the transmission of COVID‑19.  Though other businesses are starting to reopen, CMS does not recommend resuming visitation in nursing homes until Phase 3 of the Guidelines for Opening Up America Again.  The CMS guidance provides states with flexibility on deciding how to implement the criteria in the guidelines, given that the COVID-19 pandemic is affecting communities differently.  States can require that, before opening, all facilities in a region meet the reopening benchmarks, or determine reopening on a building‑by‑building basis.

CMS Announced Lower Out-of-Pocket Insulin Costs

CMS has announced that it is capping out-of-pocket insulin costs for Medicare beneficiaries at $35 per month.  Over 3.3 million Medicare beneficiaries use one or more of the common forms of insulin, and CMS estimates that beneficiaries could see an average out‑of‑pocket savings of $446, or 66 percent, for their insulin.  The $35 per month cap applies to both pen and vial dosage forms for rapid‑acting, short‑acting, intermediate‑acting and long‑acting insulin.

CDC Guidance on Antibody Testing

The CDC has released Interim Guidelines for COVID-19 antibody testing.  Antibody tests help determine whether the person being tested was ever infected, even if that person was not symptomatic.  According to the guidelines, the tests should be used to help determine the proportion of a population previously infected with COVID‑19.  Test results also may assist with identifying and determining persons who may qualify to donate blood to be used to manufacture convalescent plasma as a possible treatment for people with serious cases of COVID‑19.  However, the CDC warns that serologic tests should not be used at this time to determine if an individual is immune.  A list of antibody tests authorized by the U.S. Food and Drug Administration (“FDA”) is maintained on the FDA website.

Court Rules That HHS Does Not Have to Recalculate Medicare Payments Impacted by Abandoned Rate Reduction

On May 27, 2020, the U.S. Court of Appeals for the District of Columbia Circuit affirmed a district court decision granting summary judgment to HHS on the grounds that a group of hospitals who received lower Medicare reimbursements due to an HHS “two-midnight” rule rate cut were not entitled to additional payments.  In 2014, HHS implemented a 0.2 percent rate reduction in an effort to reduce costs associated with its “two-midnight” rule.  The “two-midnight” rule states that hospital stays spanning at least “two midnights” are presumptively appropriate for reimbursement at inpatient rates.  A group of hospitals challenged the rate reduction, and, in response, the district court remanded the 2014 rule to HHS without vacating it.  HHS eventually eliminated the rate reduction and, in 2017, HHS increased the Medicare inpatient rates by 0.6 percent to offset the past effects of the previous rate reduction.  Several hospitals appealed, contending that the district court erred in failing to vacate the 2014 rule altogether or, alternatively, requiring HHS to provide additional financial reimbursement to hospitals aggrieved by the rate reduction. The D.C. Circuit disagreed, and affirmed the district court’s grant of summary judgment.   A copy of the appellate opinion can be found here.