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The Office of Inspector General (OIG) of the Department of Health and Human Services (HHS) has published a major proposed rule that would amend the safe harbors to the Anti-Kickback Statute (AKS) and the Civil Monetary Penalty rules to protect certain payment practices and business arrangements from criminal prosecution or civil sanctions under the AKS. Reed Smith has prepared a Client Alert analyzing the proposed rule, highlighting areas where the OIG is seeking public comment. Overall, the OIG appears to recognize that new health care delivery mechanisms demand a more flexible approach to fraud and abuse enforcement than has been the case in the past, as discussed in our analysis.
Continue Reading Reed Smith Client Alert: Analysis of HHS OIG Proposed Rule to Amend the Anti-Kickback Safe Harbors, CMP Rules on Beneficiary Inducements & Gainsharing Regulations

The Drug Enforcement Administration (DEA) has published a final rule to implement the Secure and Responsible Drug Disposal Act of 2010, which was intended to mitigate prescription drug abuse by providing safe and secure mechanisms for “ultimate users” to dispose of unused or unwanted pharmaceutical controlled substances. The regulations allow authorized manufacturers, distributors, reverse…

On September 19, 2014, the Office of Inspector General (OIG) of the Department of Health & Human Services issued a Special Advisory Bulletin (SAB) in which it identified several potential regulatory risks to federal health care programs as the result of coupon programs used by drug manufacturers to reduce or eliminate patient copayments for brand-name drugs. In the SAB, the OIG explains that coupon program sponsors and pharmacies will risk the receipt of penalties if they do not take steps to actively prevent federal health care program beneficiaries from using the coupons. According to the OIG, these coupon programs qualify as examples of remuneration offered to consumers to encourage the purchase and use of specific items, and therefore implicate the federal Anti-Kickback Statute. In addition, a claim that includes items or services resulting from such a kickback violation would constitute a false or fraudulent claim under the False Claims Act.
Continue Reading HHS OIG Paints with Broad Brush in Criticizing Drug Manufacturer Coupon Programs

On the heels of its proposed rule to expand its health program exclusion authority, the Office of Inspector General (OIG) of the Department of Health and Human Services has published a proposed rule that would amend the health care program civil monetary penalty (CMP) regulations. The rule would codify the OIG’s expanded statutory authority under the Affordable Care Act to impose CMPs on providers and suppliers and would allow for significant penalties in a variety of scenarios, some of which could extend beyond what is currently permitted.

Reed Smith attorneys have prepared a Client Alert summarizing and analyzing the OIG’s proposed rule, including the various scenarios under which CMPs could be issued under the proposed regulations, such as: failure to report and return an overpayment; failure to grant OIG timely access to records upon request; ordering or prescribing items or services while excluded from a federal health care program, as well as arranging or contracting with an individual or entity who meets this criteria; making false statements or omitting or misrepresenting material facts in an application, bid, or contract; and failing to submit or certify drug-pricing and product information in a timely manner. In addition, the alert covers the changes in technical language proposed by OIG to clarify and more clearly define the scope of CMP regulations.
Continue Reading OIG Proposed Rule Would Expand Civil Monetary Penalty Authority

On May 9, 2014, the Office of Inspector General (OIG) of the Department of Health and Human Services (HHS) published a proposed rule that would significantly expand the exclusion regulations applicable to persons or entities that receive, directly or indirectly, funds from federal health care programs (the Proposed Rule). The Affordable Care Act (ACA) expanded the OIG’s authority for exclusion, and authorized the use of testimonial subpoenas in investigations of exclusion cases. In this Proposed Rule, the OIG incorporates these statutory changes, revises the definitions applicable to exclusions, proposes early reinstatement procedures, and offers a number of proposed policy changes as to when and how exclusions may take place.

Reed Smith has prepared a Client Alert that provides an overview of the Proposed Rule, including: proposed revisions to definitions; new grounds for exclusion; clarifications to existing regulations to add mitigating and aggravating factors; early reinstatement procedures; and proposed procedural changes in the OIG’s exclusion authorities In particular, we discuss the OIG’s assertion that there should be no statute of limitations within which it would have to seek exclusion. This limitless look-back authority could place a tremendous burden on providers and suppliers, since their conduct and compliance efforts could be second-guessed many years into the future, when supporting documentation and witnesses may be long gone. We also discuss how these proposed changes to the OIG’s exclusion authorities could impact the debarment authority applicable to government contracts more generally.
Continue Reading HHS OIG Proposes Expansion of Exclusion Authorities

The Administration has issued numerous regulations recently that make additional changes to operational policies, payment provisions, and other standards applicable to health plans and Health Insurance Exchanges (also called Marketplaces) under the Affordable Care Act (ACA). Highlights include the following:
Continue Reading Obama Administration Continues to Update ACA Insurance Exchange and Health Plan Regulations

On February 24, 2014, the Departments of HHS, Labor, and Treasury published final regulations that generally bar employer-sponsored group health plans and group health insurance issuers from imposing a health coverage waiting period of more than 90 days after an employee is otherwise eligible for coverage. Other conditions for eligibility are generally permissible, such as…

As mentioned on our Life Sciences Legal Update blog, the Food and Drug Administration (FDA) announced today it has proposed significant updates to the Nutrition Facts label for foods intended to expand and highlight the information consumers need to make well-informed food choices.  FDA also is proposing changes to how serving sizes themselves are calculated.

This post was also written by Allison Warden Sizemore.

On February 12, 2014, the Internal Revenue Service (IRS) published final regulations modifying the timeline under which certain employers will be required to make “shared responsibility” payments if they do not provide qualified health insurance for their full-time employees and dependents pursuant to the Affordable…

On December 27, 2013, the Office of Inspector General and the Centers for Medicare & Medicaid Services each published, in the Federal Register, a final rule that amends regulations protecting, from the Anti-Kickback Statute and Stark law, certain arrangements related to the donation of interoperable electronic health records (EHR) software or information technology and training services related to such EHR software. Among these amended regulations was the extension of protections of the Stark law exception and the Anti-Kickback safe harbor from December 31, 2013 to December 31, 2021 (the “sunset” provisions).
Continue Reading Final Rules Issued Extending Protections of Electronic Health Record Donations

On November 13, 2013, the Departments of Health and Human Services (HHS), Labor, and the Treasury published a joint final rule implementing the Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA). The MHPAEA requires group health insurance plans to provide parity between mental health or substance use…

The Internal Revenue Service (IRS) has issued final regulations to implement the ACA requirement that every individual have basic health insurance coverage, qualify for an exemption, or make a “shared responsibility” payment when filing a federal income tax return, beginning in 2014. Individuals are exempt from the payment obligation if coverage is unaffordable, if they…

As covered on Reed Smith’s Life Sciences Legal Update blog, Affinity Health Plan, Inc. (Affinity) recently reached a $1.2 million settlement with the HHS Office for Civil Rights related to potential violations of the Health Information Portability and Accountability Act of 1996 (HIPAA). Affinity self-reported a breach after learning from a CBS Evening News investigative…

As reported on Reed Smith’s Life Sciences Legal Update blog, the local Beijing office of the Ministry of Health (MOH) of the People’s Republic of China recently announced that it has started a three-month review of the use of high-value medical consumables and large-scale medical equipment in Beijing. Noting that prior inspections of hospitals…

On July 2, 2013, the Obama Administration announced (via a web posting) that it is delaying the Affordable Care Act’s (ACA) employer “shared responsibility” payment obligation (commonly referred to as the “employer mandate”) until January 1, 2015. The “shared responsibility” payment requirement, originally scheduled to begin January 1, 2014, requires certain employers with 50…

On May 29, 2013, the Internal Revenue Service and the Department of Labor (DOL) and HHS released final regulations regarding wellness programs integrated with employer-sponsored health plans. The new wellness program standards apply to insured and self-insured programs, grandfathered and non-grandfathered, and are effective for plan years beginning on and after January 1, 2014.  A…

The Presidential Commission for the Study of Bioethical Issues is requesting public comment on the ethical, legal, and social issues raised by “incidental findings” (e.g., information obtained from testing that was not its intended or expected object) that arise from genetic and genomic testing, imaging, and testing of biological specimens conducted in the clinical, research,…