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Peter Terreri

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California lawmakers are once again considering legislation targeting private equity’s influence in health care. Senate Bill 351 (SB 351), introduced on February 12, 2025, seeks to limit the influence of management service organizations (MSOs) and dental service organizations (DSOs) backed by private equity (PE) groups and hedge funds over medical and dental practices.

SB 351 adopts certain provisions of last year’s vetoed Assembly Bill 3129 (AB 3129), which would have required PE groups and hedge funds to obtain California Attorney General (AG) approval before entering into certain health care transactions. In September 2024, Governor Gavin Newsom vetoed that bill, citing redundancy with the California Office of Health Care Affordability’s (OHCA) existing oversight of health care transactions. Our discussion of OHCA’s health care transaction notice requirements is available in an earlier Reed Smith in-depth piece.Continue Reading California to Reconsider Restrictions on Private Equity Influence in Medicine and Dentistry

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…

In its recently released 2025 proposed Medicare Physician Fee Schedule (“MPFS”), the Centers for Medicare & Medicaid Services (“CMS”) proposed two important modifications to the Medicare 60-day overpayment refund rule—a new “identified overpayment” standard and codification of a 6-month timeframe to investigate and quantify an overpayment.

A product of the Affordable Care Act, the 60-day rule requires a person to report and return Part A and B overpayments within 60 days of identification. In 2016, CMS clarified that an overpayment is “identified” when a person, “through the exercise of reasonable diligence,” should have identified and quantified an overpayment. In the preamble to the 2016 rule, CMS established that “reasonable diligence” is demonstrated through a timely, good faith investigation, which is, at most, 6 months from the receipt of credible information of a potential overpayment.Continue Reading CMS Revisits Medicare Overpayment Standards in 2025 Physician Fee Schedule

On April 8, 2024, the Department of Health and Human Services Office of Inspector General (OIG) issued Advisory Opinion No. 24-02, involving independent charity patient assistance programs (PAPs) associated with 12 specific diseases (the Disease Funds) operated by the Requestor. Each Disease Fund has a single donor–a pharmaceutical manufacturer that manufactures or markets a drug to treat the disease state associated with the fund.

Although the arrangement generates remuneration prohibited under the federal Anti-Kickback Statute (AKS) if the requisite intent were present, the OIG determined it would not impose sanctions on the Requestor. In exercising its enforcement discretion, the OIG acknowledged the public policy benefits of independent charity PAPs while highlighting the importance of a charity’s independence from pharmaceutical manufacturer influence. Additionally, the arrangement does not implicate the federal Beneficiary Inducements Civil Monetary Penalties (CMP) law.

The OIG set an effective period for the opinion that expires January 1, 2027 due to upcoming reductions in Medicare Part D cost sharing associated with the Inflation Reduction Act. The reduction in beneficiary out-of-pocket expenses could ease demand for PAP subsidies and alter the OIG’s assessment of the benefits and risks of the arrangement.Continue Reading OIG Exercises Discretion in Independent Charity Patient Assistance Program

The Department of Health and Human Services Office of the Inspector General (OIG) has released an advisory opinion permitting a technology company to charge health care providers “per booking” fees to participate in its online provider directory and to allow the same providers to bid on advertising that appears as specialized search results or banner ads within its digital “marketplace.” This is the second time that the OIG has opined on this particular arrangement, having approved an earlier, although slightly different, version of the arrangement by the same company in Advisory Opinion 19-04, which was issued in 2019.

In the most recent opinion, the OIG determined that, although the arrangement might violate the Federal Anti-Kickback Statute (AKS) and the Beneficiary Inducement Civil Monetary Penalty (CMP) law, the office would not enforce those statutes against the company because the nature of the revised fees and search functionality presents a sufficiently low risk of fraud and abuse. Important to the OIG’s decision was the requestor’s certification that the fees do not exceed fair market value of the requesting company’s services to providers related to its marketplace nor do they take into account the user’s insurance status or the volume or value of referrals to the providers.

The OIG’s opinion letter protects only the current arrangement described to it by the requestor, and the agency declined to opine on any continuing contracts under an older version of the program.Continue Reading OIG again approves online health directory’s use of appointment and advertising fees

On April 18, 2023, the U.S. Department of Health and Human Services (“HHS”) announced its plan to maintain access to COVID-19 vaccines and treatment following the end of the Public Health Emergency on May 11, 2023. The “HHS Bridge Access Program for COVID-19 Vaccines and Treatments” is a $1.1 billion public-private partnership between HHS, pharmacy chains, and drug manufacturers. Essentially, HHS and drug manufacturers will provide COVID-19 vaccines and treatments, like Paxlovid and Lagevrio, to pharmacy chains, which will administer them to individuals without insurance at no cost.

Under the program, the Centers for Disease Control and Prevention (“CDC”), will use its existing authority under Section 317 of the Public Health Service Act to purchase and distribute COVID-19 vaccines and allocate them through its network of 64 state and local health departments, as well as through Health Resources and Services Administration (“HRSA”) supported health centers.Continue Reading HHS Proposes Bridge Access Program for COVID-19 Vaccines and Treatments