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CMS launches database of manufacturer and GPO payments to physicians

October 3, 2014 Leave a comment

The following post will also be published today on the Akerman Health Rx blog.

The Affordable Care Act contains a provision known as the Physician Payments Sunshine Act, which requires the Centers for Medicare and Medicaid Services (“CMS”) to establish a national databank containing information on the financial relationships between physicians (which includes dentists, chiropractors, and other physician specialties) and teaching hospitals, applicable manufacturers, and group purchasing organizations (“GPOs”).  CMS launched its Open Payments website on September 30, 2014 , making its database available to the public.

The database is populated by information reported to CMS by applicable manufacturers and GPOs regarding their payments or other transfers of value to physicians and teaching hospitals.  It is important to note that this reported information specifically includes any ownership or investment interest that physicians (and their immediate family members) have in the manufacturers and GPOs.

CMS encourages physicians and teaching hospitals to register with the Open Payments website.  While registration is voluntary, the reported information is made available to registrants before being made public, and registrants are given an opportunity to dispute any reported information.  In fact, there is a mobile app (and other resources) that allows physicians, teaching hospitals, manufacturers, and GPOs to track provider and industry contact details, share information, and track payments and other transfers of value.

According to CMS and as reported, 4.4 Million payments valued at nearly $3.5 billion were made to 546,000 individual physicians and 1,360 teaching hospitals in the last five months of 2013.  The website will provide future reports on an annual basis.  Beginning in June 2015, it is expected to report twelve full months of data.

We know that the public, and in particular the press, will access the Open Payments database, and there will likely be a high level of misunderstanding and misinformation.  One cannot forget the feeding frenzy that arose when CMS released physician Medicare billing data  earlier this year.  Any physician who receives payments from a manufacturer or GPO would presumably want advance notice of any disclosure regarding payments to that physician.   Accordingly, any physician who does receive such payments should register on the Open Payments website and check the accuracy of all information reported about them, and be prepared to answer questions they may be asked.

Healthcare Reform’s Impact on Physician Practices

July 27, 2013 Leave a comment

On August 1 in Tampa and on August 23 in Sarasota, Akerman is co-sponsoring a Lunch ‘n’ Learn Program on the impact of healthcare reform on physician practices.  If you would like to attend either event, please follow the applicable link and RSVP.

I will be one of the panelists.  My topic is “Mergers, Hospitals, and Networks, oh my! — What are Physician Practices Doing to Survive?”

Supreme Court Upholds FTC Disapproval of Hospital Merger

February 24, 2013 Leave a comment

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From Akerman’s Health Law Rx Blog:

POSTED BY MARSHALL R. BURACK ON FEBRUARY 21, 2013

In a decision issued on February 19, 2013, the U.S. Supreme Court upheld the Federal Trade Commission’s efforts to prohibit a hospital merger which would substantially reduce competition.  Federal Trade Commission v. Phoebe Putney Health System, Inc. involved the acquisition by a public hospital in Georgia of the only other hospital in the county.  The FTC alleged that the transaction would substantially reduce competition in the market for acute care hospital services and sought to prohibit the transaction as being in violation of Federal antitrust laws.

The lower court dismissed the FTC’s claim, holding that, because the acquisition was effected pursuant to Georgia’s Hospital Authorities Law, the acquisition was immune from Federal antitrust law under the state action doctrine.  Under the state action doctrine, certain anti-competitive actions taken or authorized by state government or an agency of state government are immune from Federal antitrust prosecution.  The Georgia Hospital Authorities Law authorized political subdivisions of the state of Georgia to create hospital authorities as special purpose entities, with the power to acquire, lease and operate hospitals and other healthcare facilities.   The hospital system successfully argued in the lower court that the power to acquire hospitals granted to it by the Hospital Authorities Law immunized the acquisition of the competing hospital from Federal antitrust law under the state action doctrine.

The Supreme Court reversed the holding of the lower court, ruling that the state action doctrine protects anti-competitive behavior taken or authorized by state government only if the anti-competitive actions are undertaken pursuant to a “clearly articulated and affirmatively expressed” state policy to displace competition.  The Supreme Court found that, although the Georgia Hospital Authorities Law granted public hospital authorities the power to acquire hospitals, there was no evidence in the Law that the Georgia Legislature affirmatively contemplated granting hospital authorities the power to substantially reduce or displace competition for hospital services in a particular market.

From a healthcare policy perspective, the case demonstrates support for competition among providers as a positive value that should be protected, absent a very specific indication of state intent to limit competition.  From a more general jurisprudential perspective, the case is a surprising example of the Roberts Court, in a unanimous decision, limiting the authority of the states and supporting and expanding Federal antitrust powers.

Health Care Reform – Should Employers Reduce Expected Health Costs in 2014 by Transitioning Some Full Time Employees to Part Time Status Now?

February 4, 2013 Leave a comment

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From Akerman’s Health Law Rx Blog:

POSTED BY BETH ALCALDE ON FEBRUARY 1, 2013

2013 is shaping up to be a very busy year for employers in all industries, with the continued implementation of the Patient Protection and Affordable Care Act (“ACA”). Recognizing that in 2014, applicable large employers will avoid ACA-related penalty taxes by offering required affordable group health plan coverage just to full-time employees (i.e., those working an average of 30 hours or more per week, as calculated in a number of permitted ways), some applicable large employers have already begun examining whether to cut their employees’ hours.

Considerations in the reduction of hours decision will vary by industry and by employer, and there is no one-size-fits-all approach. Some of the factors to weigh should include the following:

  • How much will the costs of health coverage continue to rise for this employer? What portion of those costs are expected to be specifically attributable to these employees?
  • What tax savings are currently available for the employer-sponsored coverage for these employees?
  • Are there employee morale, recruitment, productivity, and/or retention issues to consider?
  • Are there public relations or government relations issues to consider?
  • How many part-time employees does the company currently have? Does the company’s business model permit a shift away from full time employment?
  • Will salary increases be needed if no insurance is offered to these employees?
  • How many of these employees are expected to be eligible for subsidized health insurance coverage in a state or federal exchange?  (Note that employers are not advised to solicit pledges from employees to not seek a subsidy in exchange for continued full time employment.)

11th Circuit Upholds Florida’s Patient Self-Referral Act

February 4, 2013 Leave a comment

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From Akerman’s Health Law Rx Blog:

POSTED BY JOSEPH W. N. RUGG ON FEBRUARY 4, 2013

Last month, in the case Fresenius Medical Care Holdings, Inc. et al. vs. DVA Renal Healthcare, Inc., the 11th Circuit Court of Appeals upheld the constitutionality of the Florida Patient Self-Referral Act of 1992.

The Florida Legislature modeled the Florida Act after the federal Physician Self-Referral Prohibitions, or Stark law, that was passed in 1989.  The Stark law has gone through a number of revisions and clarifications over the last 23 years, but the Florida Legislature has not kept the Florida Act up to date with the many changes in the Stark law.  The result is that the Florida Act contains provisions that are either inconsistent with, or in some instances more burdensome than, the Stark law.  This makes it difficult for healthcare businesses to operate in Florida, as Fresenius discovered.

Fresenius and the related appellants are out-of-state corporations that provide renal dialysis services in Florida, both directly and through subsidiary corporations, to patients suffering from end stage renal disease.  Fresenius wanted to use a vertically integrated business model in Florida and refer all the patients’ blood work to associated laboratories.  Fresenius stated that such a business model would be more efficient and better for patients.  However, because the employee-physicians of Fresenius had a financial interest in the associated laboratories, they were prohibited by the Florida Act from referring their patients there for blood work.

Fresenius sued the Secretary of the Florida Department of Health and the members of the Florida Boards of Medicine and Osteopathic Medicine, arguing that the Florida Act is unconstitutional because it is (1) preempted by federal law, (2) violative of the dormant U.S. Constitution’s Commerce Clause, and (3) violative of substantive due process.

The Court of Appeals was not persuaded by any of the legal arguments made by Fresenius and upheld the constitutionality of the Florida Act.

The important take away from this case is that in Florida, as in many states, there are legal restrictions on a physician’s ability to refer patients to entities in which the physician may have an investment interest.  Compliance with the Stark law is not enough.  The Florida Act is much more restrictive.  Moreover, Florida has its own versions of the anti-kickback and the false claims statutes.  When physicians do business transactions in Florida, it is critical that all of the relevant statutes are carefully considered.

Akerman’s Health Law Rx Blog

February 4, 2013 Leave a comment

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I am pleased to announce my firm’s new health law blog, Health Law Rx Blog

Akerman’s Health Law Rx Blog provides timely updates on the latest health law issues, keeping the firm’s clients, friends, and readers up to date on pertinent legal developments. Akerman attorneys regularly update the blog with changes in the law and other relevant news. As this is meant to be an interactive site, your comments and contributions are appreciated.  I am one of the contributors, so I hope you will visit the blog often and participate in any discussions that interest you.  I plan to shadow post articles from the blog that I think you will find interesting.

Content on Akerman’s Health Law Rx Blog is intended to inform you about legal developments, including recent decisions of various courts and administrative bodies. It should not be construed as legal advice or a legal opinion, and you should not act upon the information without seeking the advice of legal counsel.

With more than 550 lawyers and government affairs professionals and a network of 19 offices, Akerman is ranked among the top 100 law firms in the U.S. by The National Law Journal NLJ 250 (2012). The firm’s Healthcare Practice Group includes over twenty attorneys and professionals representing health systems, physicians, health insurers, and other clients in all aspects of healthcare law across Florida and throughout the United States.

Physician – Hospital Co-Management Arrangements

September 27, 2011 Leave a comment

My partner, Marshall Burack, authored an Akerman Practice Update for our Healthcare Practice Group on physician-hospital co-management arrangements.

I have previously written that co-management arrangements are one important alternative for physicians to consider as they explore workable and financially viable opportunities in this new era of healthcare delivery.    So, I think you will find Marshall’s Practice Update to be very timely.   This is something that we are currently assisting physician and hospital clients on.

If you do not have time to read the entire article, here is a quick summary from Marshall’s concluding paragraphs:

A physician-hospital co-management arrangement permits a hospital to provide financial incentives for physician members of the medical staff to assist the hospital in improving the quality and reducing the cost of providing patient care. A co-management arrangement can be an attractive alternative to direct hospital employment of physicians, both for hospitals which do not want to assume the financial and administrative burden of owning and operating a large physician practice, and for physicians who wish to maintain their independence rather than becoming hospital employees.

Because a co-management arrangement involves the payment of compensation to physicians who refer patients to the hospital, the arrangement must be structured properly in order to avoid violation of applicable health care statutes and regulations. Hospitals which are considering entering into a co-management arrangement with members of the hospital’s medical staff should engage knowledgeable health care counsel, as well as experienced consultants who will help structure and monitor the arrangement and who will confirm that compensation amounts reflect the fair market value of the management services provided. If a hospital ensures that the co-management arrangement is structured properly, the arrangement should prove to be beneficial for the hospital, the physicians, and most significantly, for hospital patients who will receive higher quality care.

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