On May 5, the Trump Administration issued a pair of executive orders that could signal big changes for the drug industry and health research efforts in the United States. The orders, in part, direct federal agencies to take actions by this fall to curtail certain pharmaceutical manufacturing and health research activities performed outside the United
Elimination of the Richardson Waiver Means Changes . . . But To What End?
In February 1971, at the tail end of Richard Nixon’s first term, his Secretary of Health, Education and Welfare, Elliot Richardson, approved a directive that was printed in the Federal Register as a Statement of Policy on “Public Participation in Rulemaking”.
The statement asserted that the Department of Health Education and Welfare (the precursor to the current Department of Health and Human Services [HHS]) would NOT exempt from full notice and comment rulemaking any rules relating to public property, loans, grants, benefits or contracts. The Department made this decision even though it was permitted to exempt these rules by the text of the Administrative Procedure Act (APA). Additionally, the policy statement urged the agency to only sparingly use a “good cause” exemption from notice and comment that was also included in the text of the APA.Continue Reading Elimination of the Richardson Waiver Means Changes . . . But To What End?
Reed Smith’s 11th Annual (Virtual) Health Care Conference Coming March 17-21
Reed Smith has announced the dates and topics for it’s 11th annual health care conference from March 17-21, 2024. The conference will be conducted entirely virtually this year with CLE webinars offered throughout the week on important and timely topics for the health care industry.
The schedule of the sessions is below, all of the webinars are free and have each been presumptively approved for CLE credit in California, Connecticut, Illinois, New Jersey, New York, Pennsylvania, Texas, and West Virginia. Applications for CLE credit will also be filed in Colorado, Delaware, Florida, Georgia, Ohio, and Virginia.
Webinars can also be watched on-demand, but viewers who do so will only be able to obtain CLE credit in California, Connecticut, Illinois, New Jersey, New York, Pennsylvania, Texas and West Virginia. They will also have to alert Reed Smith to their viewing of the program to obtain credit.
To register for any or all of the webinars, please click here.
Here is the schedule of webinars for the week: (all times are in EST)Continue Reading Reed Smith’s 11th Annual (Virtual) Health Care Conference Coming March 17-21
DOJ exceeds $2.9 billion in FCA recoveries in 2024 and reports a record number of qui tams
On January 15, the Department of Justice (DOJ) reported that False Claims Act (FCA) recoveries for civil cases in fiscal year 2024 totaled approximately $2.9 billion, representing about a $200 million increase from 2023. And these numbers do not account for two major settlements that were reached shortly after the close of the fiscal year that would have added an additional $830 million to the total. Of the total recovered by DOJ in 2024, approximately $1.67 billion (58%) related to matters involving the health care sector. Although a lower percentage of these recoveries related to health care than prior years, the health care sector remains the primary industry under scrutiny.
For the second year in a row, the total number of qui tam lawsuits increased, demonstrating continued fraud enforcement by the agency and an active environment for private whistleblowers. The 979 qui tam cases filed in 2024 is a new record, blowing past the prior record of 757 cases in 2013 and far exceeding last year’s total of 713. And while the number of government-initiated cases dropped from last year’s record pace, the 423 non qui tam cases filed in 2024 is an order of magnitude higher than any other year since 1986.
This increase in FCA activity comes at a time of uncertainty for the law. As Reed Smith covered last fall, a federal judge in Florida ruled that the qui tam provisions of the FCA violated the Appointments Clause of the Constitution by investing core executive powers into unappointed whistleblowers. That decision followed reasoning in a Supreme Court dissent and is on appeal to the U.S. Court of Appeals for the Eleventh Circuit. Incoming Attorney General Pam Bondi assured senators during her confirmation hearing that she would defend the constitutionality of the provisions.Continue Reading DOJ exceeds $2.9 billion in FCA recoveries in 2024 and reports a record number of qui tams
Medicare overpayment rule standard changes finalized in 2025 CMS Physician Fee Schedule
In the final 2025 Medicare Physician Fee Schedule, which is set to be published in the Federal Register on December 9, the Centers for Medicare and Medicaid Services (CMS) included substantive changes to the regulations governing when a provider must report and return a Medicare overpayment in order to avoid liability under the False Claims
2024 Election Results Could Mean Significant Restrictions on Reproductive Rights
The 2024 elections created a bit of a mixed result for reproductive rights in the United States. A number of states passed ballot initiatives designed to increase access to abortion and reproductive health services. However, at the same time, Donald Trump was elected back into the office of the President and Republicans appear to have
CMS Ramps up Process for Identifying Private-Equity Ownership of SNFs
This month, the Centers for Medicare & Medicaid Services (CMS) has begun an off-cycle revalidation process directed at all Medicare-participating skilled nursing facilities (SNFs). The process is designed to implement provisions of the Affordable Care Act (ACA) that require facilities to detail their ownership structures and key managerial personnel.
CMS is seeking information about ownership of SNFs by private equity firms and real estate investment trusts (REITs). In September, CMS revised Form 855A to require a SNF to report those types of ownership interests. The agency has also released a guidance document detailing the requirements and how a SNF should go about filling out the form.
CMS indicated that it would seek this off-cycle revalidation process as part of its effort to implement the disclosure requirements of Section 1124(c) of the Social Security Act (42 U.S.C. § 1320a-3(c)) in a Final Rule issued in November 2023 (88 Fed. Reg. 80,141).Continue Reading CMS Ramps up Process for Identifying Private-Equity Ownership of SNFs
Are False Claims Act Whistleblower Cases Unconstitutional?
Are the qui tam provisions of the False Claims Act an unconstitutional delegation of authority to private citizens? One federal court, accepting an invitation from a Supreme Court dissent, ruled the answer is yes.
In an opinion issued yesterday dismissing a False Claims Act case, Judge Kathryn Kimball Mizelle of the U.S. District Court for the Middle District of Florida ruled that the statute’s provisions that permit a private citizen to bring a claim for a violation of the False Claims Act in the absence of intervention by the Federal Government are an unconstitutional delegation of executive authority that violated the Appointments Clause of Article II of the Constitution.
According to the court, the qui tam provisions, as strengthened by the False Claims Act Amendments Act of 1986 (Pub. L. No. 99-562), established a mechanism whereby “unaccountable, unsworn, private actors” are permitted “to exercise core executive power with substantial consequences to members of the public.” The court ruled that such a provision was unconstitutional as it permitted a private citizen to stand in as the “avatar in litigation” in which the interest of the United States is in issue.Continue Reading Are False Claims Act Whistleblower Cases Unconstitutional?
Artificial Intelligence raises important legal and policy considerations for patient data and clinical trials
The use of artificial intelligence (AI) in research and development and the research and development of AI solutions themselves create far reaching legal and policy questions in the clinical research context.
In one of the latest installments of Reed Smith’s video series “AI explained”, Reed Smith attorneys Nancy Bonifant Halstead and Sarah Thompson Schick
HHS Finalizes Rule on Health Care Provider Information Blocking Penalties
The Centers for Medicare & Medicaid Services (“CMS”) and the Office of the National Coordinator for Health Information Technology (“ONC”) have released a final rule establishing “disincentives” (i.e., penalties) for health care providers that participate in certain Medicare payment programs who have engaged in information blocking, as determined by the HHS Office of Inspector General (“OIG”).
The rule continues to signal the federal government’s commitment to encouraging permitted access to and exchange of electronic health information. The rule summarizes elements of the June 2023 OIG final rule, which established penalties for information blocking for certified health IT developers, health information networks, and health information exchanges. The rule also details the procedures that OIG will follow when investigating potential health care provider information blocking claims. There is a wide range of health care providers subject to the rule including, hospitals, physicians, nursing facilities, group practices, pharmacies, and certain eligible professionals participating in Medicare and Medicaid programs, among others, and disincentives are not limited to HIPAA-regulated entities or to healthcare providers who use ONC-certified health IT.Continue Reading HHS Finalizes Rule on Health Care Provider Information Blocking Penalties
Reed Smith Provides Analysis of Chevron’s End and Its Impact on Regulated Industries
The fallout from last week’s Loper Bright/Relentless opinion by the U.S. Supreme Court that prospectively eliminated Chevron deference is still not fully clear, but Reed Smith has put together a Chevron Deference Resource Center where we will gather perspectives and events to help guide industry stakeholders through the new post-Chevron world.
The
The End of Chevron and What it Means for Regulated Industries: Webinar and Alerts
The Supreme Court’s decision last week in the companion cases of Loper Bright Enterprises v. Raimondo and Relentless, Inc. v. Department of Commerce overturned the Court’s prior precedent in Chevron U.S.A., Inc. v. Natural Resources Defense Council, Inc., and, in the process, upended 40 years of administrative law practice by requiring a court that
Supreme Court Decision Leaves FDA Approval of Mifepristone Untouched, But For How Long?
This post was co-authored by Megan E. McWaters, a Reed Smith summer associate.
In a unanimous decision, the U.S. Supreme Court overturned a ruling by the U.S. Court of Appeals for the Fifth Circuit which had placed doubt on the continuing efforts by the U.S. Food and Drug Administration (FDA) to regulate the dispensing of mifepristone, one of the drugs used in a medication abortion.
The decision, written by Justice Kavanaugh, held that the doctors and associations who initially brought the challenge in the Northern District of Texas did not have sufficient standing to bring their claims before a federal court. The doctors involved in the suit do not prescribe or dispense mifepristone, and according to Justice Kavanaugh, nor would they be forced to provide even emergency abortion care to patients as a result of the FDA’s approval of the drug.Continue Reading Supreme Court Decision Leaves FDA Approval of Mifepristone Untouched, But For How Long?
Colorado sets baseline for AI regulation in high-risk applications, including health care
Colorado recently passed a law creating consumer protections for interactions with artificial intelligence systems. The law specifically identifies high-risk systems, including in those that impact health care. The law requires risk mitigation, documentation and robust governance.
Monique N. Bhargava has written an in-depth article on the law and what it means for AI regulation in
What to know about the new CMS Minimum Staffing Rule for LTC Facilities
The Centers for Medicare & Medicaid Services (CMS) has finally published the minimum staffing rule for Long Term Care facilities in the Federal Register, which starts the clock for compliance with some provisions of the rule.
But what does the rule actually do? And what do facilities have to do in order to come into
HHS Modifies HIPAA Privacy Rule to Shield Reproductive Health Information from Third Party Access
In a final rule published on April 26, the U.S. Department of Health and Human Services (“HHS”) amends the HIPAA Privacy Rule to bolster protections for individuals’ reproductive health information. This final rule comes almost exactly a year after HHS published its draft rule on the subject.
The rule is part of the Biden administration’s effort to address the Supreme Court’s 2022 decision in Dobbs v. Jackson Women’s Health Organization. Dobbs’ reversal of Roe v. Wade resulted in a patchwork of state laws governing abortion, some of which require or permit health care providers to release personal information about reproductive health care to state authorities for patients who sought an abortion.
The rule is scheduled to take effect on June 25, 2024 and most provisions will be enforceable as of December 23, 2024. Below, we summarize in more detail some of the notable changes to the HIPAA Privacy Rule. Continue Reading HHS Modifies HIPAA Privacy Rule to Shield Reproductive Health Information from Third Party Access
Are you listening, Medicare Advantage and Medicare Part D Plans? It’s CMS (Again)
Making good on its promises to enhance oversight of Medicare Advantage (MA) and Medicare Part D plans, the Centers for Medicare and Medicaid Services (CMS) has submitted for public inspection its Contract Year 2025 Final Rule. The final rule, published in the Federal Register on April 23 and taking effect on June 3, 2024, codifies existing MA and Part D sub-regulatory guidance, adds a number of new policies for Contract Year 2025 and implements provisions of the Bipartisan Budget Act of 2018 (BBA) and the Consolidated Appropriations Act, 2023 (CAA 2023).
The rule contains many substantive changes to current MA and Part D requirements. The most impactful sections of the rule include: (1) changes to the Part D formulary, including substitutions of biosimilar biological products; (2) modification of agent and broker compensation requirements for MA plans; (3) codification of consent requirements within the MA regulations for the sharing of personal beneficiary data between third party marketing organizations (TPMOs); (4) standardization of the MA Risk Adjustment Data Validation Appeals Process; (5) changes to the Part D medication therapy management program eligibility criteria; (6) changes to contracting standards and limitations on dual-eligible special needs plans; and (7) changes to the network adequacy standards within MA to add a new facility-specialty type called “Outpatient Behavioral Health”.
Also notable is what CMS does not address in the rule – CMS declined to establish what qualifies as an identification of an overpayment that needs to be returned to avoid False Claims Act violations. That potential standard has been in the works since the Contract Year 2023 rule, but stakeholders have to keep waiting as CMS notes that it may be the subject of a future rulemaking.Continue Reading Are you listening, Medicare Advantage and Medicare Part D Plans? It’s CMS (Again)
FTC, HHS, and DOJ Launch Portal to Report Anticompetitive Health Care Practices
Last week, on April 18, several federal agencies jointly launched a “one-stop shop” to facilitate reporting of allegedly anticompetitive behavior in the health care sector. While there has always been a complaint portal for the antitrust agencies, the Federal Trade Commission (FTC), the U.S. Department of Health and Human Services (HHS), and the Antitrust Division
SCOTUS Arguments on Mifepristone Cases Focus on Standing and Remedy
The U.S. Supreme Court heard arguments yesterday in the two consolidated cases challenging the U.S. Food and Drug Administration (FDA) approval of mifepristone. Throughout the questioning, the Justices focused on both the standing of the plaintiffs to bring the cases and on the suitability of the remedy sought.
The Court is expected to rule on the case in late June or early July. Although the Court has a 6-3 majority of justices appointed by Republican presidents, the questioning by the justices and the areas that they focused on seemed to indicate that any judicially-imposed limitations on both the FDA’s approval of the drug and the FDA’s current restrictions on the dispensing of mifepristone may be narrow.
At different times during the argument, both liberal and conservative Justices mixed together in the thrust of their questions in a way that could result in this case being a close decision with many different opinions or even resulting in a majority decision that would allow continued dispensation of the drug due to standing considerations.Continue Reading SCOTUS Arguments on Mifepristone Cases Focus on Standing and Remedy
Was the Consolidated Appropriations Act, 2023 Legitimately Passed by the House?
Not a question that we thought we would be asking more than a year after the large omnibus package was signed into law by President Biden. But here we are, with a federal judge in Texas ruling on Feb. 27 that the House’s passage of the Consolidated Appropriations Act, 2023 (P.L. 117-328) (CAA, 2023) violated the “quorum clause” of Article I, Section 5 of the U.S. Constitution.
The court’s ruling puts in jeopardy a number of substantive health policy provisions if it is allowed to stand. Many of the provisions of the act that could be overturned were designed to sunset at the end of 2024 and some have since been reauthorized. But some, like the FDA’s new cosmetic regulatory regime that was included in the Modernization of Cosmetics Regulation Act of 2022 (MoCRA) are more permanent and are now under threat.
The court’s decision limited its impact to only one aspect of the law and enjoined that provision only as applied to public employees in Texas, but the court’s analysis of the way that the law was passed calls into question the entire appropriations act. The Department of Justice (DOJ) has 60 days from the court’s decision to appeal to the U.S. Court of Appeals for the Fifth Circuit. The agency has filed a notice of compliance with the court indicating that neither the DOJ or Equal Employment Opportunity Commission will enforce the law against the state or its agencies.Continue Reading Was the Consolidated Appropriations Act, 2023 Legitimately Passed by the House?