Using Data Mining to Promote Compliance

Government uses data mining to select targets for enforcement actions. Your company can use data mining to promote compliance. For tips and insights listen to an eleven minute podcast in “Compliance Perspectives,” from the Society of Corporate Compliance and Ethics (SCCE).  SCCE is a member-based association providing education and news updates for ethics and compliance professionals. To listen to the podcast, click here. (


Negotiating A Deal? Ensure You Respond Appropriately To Union Requests For Information

Mergers, acquisitions, and sales can be a common event for health systems. These types of deals involve many moving parts, from both legal and operational perspectives. Given how complex deals can become, it can be easy to overlook obligations to labor unions when they arise. One recent National Labor Relations Board (“Board”) decision illustrates a key obligation for unionized health systems, the duty to furnish information, and how entities should address that obligation during deals. Crozer Chester Medical Center, 366 N.L.R.B. No. 28 (2018).

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FDA Approves Marketing of Clinical Decision Support Software for Stroke Triage in Midst of Renewed Focus on Digital Health Applications

The U.S. Food and Drug Administration (“FDA”) recently approved the Viz.Ai Contact application, a type of clinical decision support software designed to analyze computed tomography (CT) results that may notify providers of a potential stroke in their patients. In an article published March 8, 2018 as a PG Alert Email from the American Health Lawyers Association (“AHLA”), associate Jennifer M. Tharp discussed the recent approval of the software and its relation to the FDA’s increasing attention to digital health applications.  The alert also explores the FDA’s digital health application approval process, and the agency’s intention to reduce the time and cost of market entry of digital health technologies.

Copyright 2018, American Health Lawyers Association, Washington DC. Reprint permission granted.

Narrow TCPA Healthcare Exemption Upheld by D.C. Circuit

On March 16, 2018, a unanimous panel of the US Court of Appeals for the District of Columbia Circuit issued its long-awaited and much-anticipated decision in ACA Int’l v. FCC, Case No. 15-1211. Though the Court vacated certain portions of the Federal Communication Commission’s 2015 omnibus declaratory ruling and order (2015 Omnibus Order) concerning the Telephone Consumer Protection Act (TCPA), the Court upheld the Commission’s approach regarding an exemption for time-sensitive healthcare calls. We represented one of the petitioners challenging the FCC Order, and all petitions challenging the order were consolidated in front of the DC Circuit. The DC Circuit’s 51-page opinion can be found here.

By way of background, in the 2015 Omnibus Order, the FCC created a healthcare exemption for wireless calls that involved an “urgent” healthcare purpose, including, but not limited to, appointment and exam confirmations, wellness checkups, hospital preregistration instructions, lab results, and prescription notifications. The FCC had previously exempted pre-recorded calls to landlines for these purposes in a prior order. For this exemption to apply to wireless calls, however, the messages could not include telemarketing or advertising content, the calls had to be free to the end-user, and callers would have to promptly honor opt-out requests, among other restrictions.

On appeal, the DC Circuit rejected petitioner Rite Aid’s arguments that the FCC exemption for selected healthcare-related calls was arbitrary and capricious and that it violated the Health Insurance Portability and Accountability Act (HIPAA). The Court also disagreed that all healthcare-related calls fall within an exemption, such as those with “telemarketing, solicitation, or advertising content, or which include accounting, billing, debt-collection, or other financial content ” because such calls “do not arise from the sorts of emergencies that would justify suspending the TCPA’s consent regime.” In short, the Court upheld the narrow exemption in the 2015 Omnibus Order and suggested that only the enumerated “exigent” purposes would fall within the exemption. To review the discussion of the healthcare exemption in the 2015 Omnibus Order, see pages 68-72 here.

The DC Circuit also addressed three additional rulings from the 2015 Omnibus Order. For an analysis of all four rulings in the DC Circuit’s 51-page opinion and a discussion of the impact the decision may have on pending and future TCPA litigation, read our alert here.

Analysis of President Trump’s Fiscal Year 2019 Budget Request – Healthcare Impact

The Trump Administration submitted its annual budget request to Congress on February 12, 2018, formally spurring the development of Fiscal Year (FY) 2019 federal spending bills.

In light of its release, recently confirmed U.S. Department of Health and Human Services (HHS) Secretary Alex Azar issued the following statement:

“The President’s budget makes investments and reforms that are vital to making our health and human services programs work for Americans and to sustaining them for future generations. In particular, it supports our four priorities here at HHS: addressing the opioid crisis, bringing down the high price of prescription drugs, increasing the affordability and accessibility of health insurance, and improving Medicare in ways that push our health system toward paying for value rather than volume.”

Specifically, the HHS budget request is comprised of $95.4 billion in discretionary authority and $1,120 billion in mandatory funding. This reflects an increase of $8.7 billion in discretionary spending, largely for the purpose of combatting the opioid addiction epidemic.

The Administration’s budget request for HHS seeks $812 million to support the Affordable Care Act’s (ACA) risk corridor program and provide temporary funding for cost-sharing reduction (CSR) payments. Additionally, it proposes that the ACA be repealed.

To review Squire Patton Boggs’ HHS budget request analysis, read here.

To review Squire Patton Boggs’ government-wide budget request analysis, read here.

CMS to Review Stark Law in Connection with Payment Reform

CMS has recently signaled its intention to review the Stark Law and its impact on providers. During a January, 2018 American Hospital Association webinar, CMS Administrator Seema Verma announced the development of an inter-agency group to review the Stark Law in light of provider complaints that the law acts as a barrier to their ability to improve the quality and efficiency of healthcare. While Administrator Verma presented few details, the initiative will involve representatives from CMS, OIG, and DOJ. The review is in line with CMS’s “Patients Over Paperwork” project which aims to reduce regulatory obstacles in accordance with the current administration’s broad goal of reducing regulation. Continue Reading

Alleged HIPAA Violations Follow Company Post-Close

On February 13, 2018, the HHS Office of Civil Rights (“OCR”) announced that the court appointed receiver of Filefax, an Illinois company that moved and stored medical records for covered entities before going out of business in 2016, has agreed to pay $100,000 out of a receivership estate to settle potential violations of the HIPAA Privacy and Security Rules.  According to the Resolution Agreement between HHS and the receiver for Filefax, OCR began investigating Filefax after receiving an anonymous tip suggesting that Filefax had carelessly handled and improperly disclosed medical records containing protected health information (“PHI”).  OCR’s investigation revealed that between January 28, 2015, and February 14, 2015, Filefax allegedly impermissibly disclosed the medical records of approximately 2,150 patients, when the company allowed the paper records to be left unsecured in an unlocked truck outside the Filefax facility for an individual to take to a shredding and recycling facility in exchange for cash.  Filefax went out of business while OCR was investigating the alleged HIPAA violations; however, OCR nevertheless pursued its enforcement action.

According to OCR Director Roger Severino, the settlement agreement serves as a reminder that “[t]he careless handling of PHI is never acceptable…Covered entities and business associates need to be aware that OCR is committed to enforcing HIPAA regardless of whether a covered entity is opening its doors or closing them. HIPAA still applies.”   HIPAA requires covered entities and business associates to implement appropriate administrative, technical, and physical safeguards to ensure that records are secure and remain confidential during the retention period. After the retention period is over, all PHI must be disposed of in a compliant manner.  Individual states have specific record retention and disposal requirements, too, which must be considered when a company that handles PHI goes out of business.

The resolution agreement and corrective action plan are available on the OCR website at

District Court Requires Specific Claim and ERISA Plan Allegations In ERISA Complaint

Recently, a federal district court dismissed a hospital’s complaint against an ERISA plan administrator as inadequately pled and outlined the minimum degree of specificity required in similar cases.  In Polk Med. Ctr., Inc. v. Blue Cross & Blue Shield of Ga., Inc., the plaintiff hospital alleged that the defendant administrator was employing various tactics to obstruct and/or reduce reimbursements for emergency treatment, such as refusing to honor assignments of benefits and refusing to pay claims based on supposed past overpayments.  Among its claims, the plaintiff asserted claims for ERISA benefits.

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CMS Announces New Bundled Payment Model

The Centers for Medicare & Medicaid Services (CMS) recently announced the launch of a new voluntary bundled payment model called Bundled Payments for Care Improvement Advanced (BPCI Advanced). Under the new BPCI Advanced model, participants can earn additional payment if all expenditures for a beneficiary’s episode of care are under a spending target that factors in quality. The Model Performance Period for BPCI Advanced begins on October 1, 2018, when the current Bundled Payments for Care Improvement initiative expires, and runs through December 31, 2023.

BPCI Advanced will qualify as an Advanced Alternative Payment Model (Advanced APM) under the Quality Payment Program (QPP) created by the Medicare Access and Chip Reauthorization Act (MACRA).   The QPP has two tracks: the Merit-Based Incentive Payment System (MIPS) and Advanced APMs. Under Advanced APMs, providers take on financial risk to earn the Advanced APM incentive payment. Continue Reading

DOJ Reveals Data Analytics Team To Fight Fraud

The 2017 Year in Review of the Department of Justice reveals a Data Analytics Team (the “Team”) for tracking healthcare fraud. The Healthcare Fraud Unit launched the Team in order to provide data mining expertise that efficiently detects healthcare fraud. Continue Reading