Healthcare & Life Sciences

On Monday, April 6th the Centers for Medicare and Medicaid Services (“CMS”) adopted an interim final rule to change a wide range of Medicare payment policies during the COVID-19 public health emergency so that Medicare providers and suppliers have flexibility to furnish services to beneficiaries using remote communications technology. As healthcare providers implement infection prevention and control procedures throughout their operations, CMS recognizes that immediately and temporarily increasing the availability of services using telecommunications technology is necessary and appropriate to maintain Medicare beneficiary access to medically necessary services without jeopardizing their health or the health of the healthcare workers furnishing those services. The interim final rule with comment period is applicable to services provided beginning March 1, 2020, and will be effective for the period of the COVID-19 public health emergency. The rule addresses a variety of Medicare payment policies (including coverage, supervision, and “home bound” requirements) applicable to physicians and other clinicians, hospitals, home health agencies, hospice agencies, independent laboratories, ambulance service providers, rural health clinics, federally qualified health centers, inpatient rehabilitation facilities, and Medicare Part C and D health plans. The following summarizes the Medicare payment policy changes. 1. Place of Service Coding for Medicare Telehealth Services Medicare pays for a discrete set of services under Social Security Act § 1834(m) that are reported using codes that describe ‘‘face-to-face’’ services but are furnished using audio/video, real-time communication technology, instead of in-person. Clinicians bill for these Medicare telehealth services using a unique place of service code “02,” which identifies them as Medicare telehealth services. CMS pays the physician or practitioner for Medicate telehealth services at the lower Medicare Physician Fee Schedule “facility rate” because facility expenses (e.g., staff, supplies, and equipment) associated with the services are generally incurred by the site where the patient is located, and not by the remotely-located practitioner. On an interim basis CMS will pay for Medicare telehealth services at the rate that ordinarily would be paid under the Medicare physician fee schedule if the services were furnished in-person. Physicians and other practitioners billing for Medicare telehealth services should report the place of Service code that would have been reported had the service been furnished in person instead of place of service code “02.” Because Medicare identifies claims for telehealth services through the place of service code “02,” CMS has finalized use on an interim basis of CPT telehealth modifier 95, which applies to claim lines that describe services furnished via telehealth. 2. Additions to Medicare Telehealth Services As noted above, Medicare pays for a defined set of Medicare telehealth services. For telehealth services with dates of service beginning March 1, 2020 through the end of the declared COVID-19 public health emergency (including any renewals), CMS is adding the following services to the list of covered Medicare telehealth services. Together with CMS’ waivers the originating site requirements applicable to Medicare telehealth services and the OIG’s policy statement addressing waiver of beneficiary copayments for telehealth services, this expansion in covered telehealth services can facilitate the meaningful and quick expansion in deployment of telehealth services. A. Emergency Department Visits  99281 99282 99283 99284 99285 B. Initial and Subsequent Observation, and Observation Discharge Day Management 99217 99218 99219 99220 99224 99225 99226 99234 99235 99236 C. Initial Hospital Care and Hospital Discharge Day Management 99221 99222 99223 99238 99239 D. Initial Nursing Facility Visits and Nursing Facility Discharge Day Management 99304 99305 99306 99315 99316 E. Critical Care Services 99291 99292 F. Domiciliary, Rest Home, or Custodial Care Services 99327 99328 99334 99335 99336 99337 G. Home Visits 99341 99342 99343 99344 99345 99347 99348 99349 99350 H. Inpatient Neonatal and Pediatric Critical Care 99468 99469 99471 99472 99473 99475 99476 I. Initial and Continuing Intensive Care Services 99477 99478 99479 99480 J. Care Planning for Patients With Cognitive Impairment 99483 K. Group Psychotherapy 90853 (Group psychotherapy (other than of a multiple-family group)) L. End-Stage Renal Disease (ESRD) Services 90952 90953 90959 90962 M. Psychological and Neuropsychological Testing 96130 96131 96132 96133 96136 96137 96138 96139 N. Therapy Services: For these services, CMS states that because Social Security Act § 1834(m) does not provide for payment for these services as Medicare telehealth services when furnished by physical therapists, occupational therapists, or speech language pathologists. 97161 97162 97163 97164 97165 97166 97167 97168 97110 97112 97116 97535 97750 97755 97760 97761 92521 92522 92523 92524 92507 O. Radiation Treatment Management Services 77427 77427 3. Frequency Limitations on Subsequent Care Services in Inpatient and Nursing Facility Settings, and Critical Care Consultations CMS is removing the frequency restrictions for each of the following codes for subsequent inpatient visits and subsequent nursing facility visits furnished via Medicare telehealth for the duration of the PHE for the COVID–19 pandemic. A. Subsequent Inpatient Visits 99231 99232 99233 B. Subsequent Nursing Facility Visits 99307 99308 99309 99310 C. Critical Care Consultation Services G0508 G0509 4. Required ‘‘Hands-On’’ Visits for ESRD Monthly Capitation Payments Current Medicare rules state that for End Stage Renal Disease (“ESRD”) related services that are on the Medicare telehealth list, a required clinical examination of the vascular access site must be furnished face-to-face ‘‘hands on’’ (without the use of an interactive telecommunications system) by a physician, clinical nurse specialist (CNS), nurse practitioner (NP), or physician assistant (PA). CMS is permitting on an interim basis the required clinical examination to be furnished as a Medicare telehealth service during the COVID–19 pandemic. In addition, Medicare rules typically require that a beneficiary receive a face-to-face visit, without the use of telehealth, at least monthly in the case of the initial 3 months of home dialysis and at least once every 3 consecutive months after the initial 3. CMS states that they will exercise enforcement discretion on an interim basis to relax enforcement in connection with the requirements under Social Security Act § 1881(b)(3)(B) that certain visits be furnished without the use of telehealth. Specifically, CMS will not conduct review to consider whether those visits were conducted face-to-face, without the use of telehealth. This applies to the following codes: 90951 90952 90953 90954 90955 90957 90958 90959 90960 90961 90962 90963 90964 90965 90966 90967 90968 90969 90970 5. Communication Technology-Based Services Certain services are performed using remote communications technology and are paid for by the Medicare program, but are not considered Medicare telehealth services because these services are by their nature performed using communications technology and are not ordinarily performed in person. These services include certain remote patient monitoring services (e.g., CPT codes 99453, 99454, 99457, and 99458, virtual check-in services). CMS payment rules for these services have limited their use to established patients only, and advance beneficiary consent has been required. The interim final rule states that all of these services can be furnished to both new and established patients. CMS also states that beneficiary consent to receive these services can be obtained annually, can be obtained at the time that a service is furnished, and may be documented by auxiliary staff under general supervision. To mitigate exposure risks, CMS is also broadening the types of clinicians that can perform remote evaluation of patient images and virtual check-ins (HCPCS codes G2010 and G2012) to include licensed clinical social workers, clinical psychologists, physical therapists, occupational therapists, and speech-language pathologists. 6. Direct Supervision Many services paid under the Medicare physician fee schedules, such as services performed incident to a physician’s professional service (see 42 C.F.R. § 410.26), must be provided under the direct supervision of the billing physician or nonphysician practitioner, meaning that the physician or nonphysician practitioner must be present in the office suite and immediately available to furnish assistance and direction throughout the performance of the procedure. CMS is temporarily modifying the definition of direct supervision at 42 C.F.R. § 410.32(b)(3)(ii) to state that direct supervision includes virtual presence through audio/video real-time communications technology. Similarly, the definitions of direct supervision applicable to hospital outpatient services at 42 C.F.R. § 410.28(e)(1) and hospital rehabilitation and intensive cardiac rehabilitation services described at 42 C.F.R. §§ 410.47 and 410.49 are modified in the same manner to permit physician supervision of these hospital services via virtual presence through audio/video real-time communications technology when use of such technology is indicated to reduce exposure risks for the beneficiary or health care provider. Additionally, the minimum default level of physician supervision for the initiation of outpatient non-surgical extended duration therapeutic services will now be changed from direct supervision to general supervision. 7. Definition of Homebound for Purposes of Home Health Benefits The interim final rule addresses whether beneficiaries instructed to remain in their homes or are under ‘‘self-quarantine’’ are considered ‘‘confined to the home’’ or ‘‘homebound’’ for purposes of the Medicare home health benefit. CMS states that the current definition of ‘‘confined to the home’’ (that is, ‘‘homebound’’) would apply to patients: (a) Where a physician has determined that it is medically contraindicated for a beneficiary to leave the home because he or she has a confirmed or suspected diagnosis of COVID–19; or (b) where a physician determines that it is medically contraindicated for a beneficiary to leave the home because the patient has a condition that may make the patient more susceptible to contracting COVID–19. Beneficiaries must meet all other eligibility requirements to receive Medicare home health services. The beneficiary must be under the care of a physician; receiving services under a plan of care established and periodically reviewed by a physician; be in need of skilled nursing care on an intermittent basis or physical therapy or speech-language pathology; or have a continuing need for occupational therapy. 8. Home Health Benefits and Remote Technology CMS is also amending home health plan of care requirements at 42 C.F.R. § 409.43(a) to allow the integration of technology and remote communication into the home health plan of care, so long the use of technology is related to the skilled services being furnished by the nurse/therapist/therapy assistant to optimize the services furnished during the home visit, and that the use of technology is included on the home health plan of care along with a description of how the use of such technology will help to achieve the goals outlined on the plan of care without substituting for an in person visit as ordered on the plan of care. On an interim basis home health agencies can report the costs of telecommunications technology as allowable administrative and general costs on their cost reports. 9. Telecommunications and Hospice For hospices, regulations at 42 C.F.R. § 418.204 are modified to state that when a patient is receiving routine home care, hospices may provide services via a telecommunications system if it is feasible and appropriate to do so to ensure that Medicare patients can continue receiving reasonable and necessary services for the palliation and management of a patients’ terminal illness and related conditions without jeopardizing the patients’ health or the health of those who are providing such services. The use of such technology must be included on the plan of care. The inclusion of technology on the plan of care must continue to meet the requirements at 42 C.F.R. § 418.56, and must be tied to the patient-specific needs as identified in the comprehensive assessment and the measurable outcomes that the hospice anticipates will occur as a result of implementing the plan of care. Telecommunication technology can also be used by a hospice physicians or nurse practitioner for a face-to-face visit used solely for the purpose of recertifying a patient for hospice services. Telecommunications technology for this purposes means multimedia communications equipment that includes, at a minimum, audio and video equipment permitting two-way, real-time interactive communication between the patient and distant site hospice physician or nurse practitioner. Hospices can also report hospices can report the costs of telecommunications technology used to furnish services under the routine home care level of care during the public health emergency as ‘‘other patient care services’’ on their cost report. 10. Inpatient Rehabilitation Facilities In order to be considered medically necessary, inpatient rehabilitation facility services must be expected to require medical supervision involving a rehabilitation physician conducting face-to-face visits with the patient at least 3 days per week throughout the patient’s stay. CMS is modifying these rules to permit such visits to be conducted using remote telecommunication technology. In addition, CMS is temporarily eliminating the requirement that at the time of admission a patient’s medical record at the facility must contain a postadmission physician evaluation. 11. Rural Health Clinics (RHCs) and Federally Qualified Health Centers (FQHCs) For RHCs and FQHCs, CMS is expanding the services that can be included in the payment for HCPCS code G0071, and is updating the payment rate for this code to include the national non-facility payment rates for three new codes (CPT Codes 99421, 99422, and 99423) to reflect the addition of these services. In addition, to address the impact of the COVID–19 pandemic on underserved rural and urban communities, CMS is implementing changes to the requirements for visiting nursing services furnished in the home by RHCs and FQHCs. For the duration of the public health emergency, any area typically served by the RHC, and any area that is included in the FQHCs service area plan, is determined to have a shortage of home health agencies, and there is no need for the RHC or FQHC to request a determination that there is a shortage of home health agencies in the area in order for visiting nurse services to be covered by Medicare. 12. Clinical Laboratory Fee Schedule and Merit-based Incentive Payment System Updates In order to expand the testing available to Medicare beneficiaries who need it, payments will now be provided to independent laboratories for specimen collection for COVID-19 testing under certain circumstances. A travel allowance will also be provided for a lab technician to collect a specimen for testing from non-hospital inpatients or homebound patients. Clinician participation in a COVID-19 clinical trial utilizing a drug or biological product to treat a patient with a COVID-19 infection will now be credited as an improvement activity for the Merit-based Incentive Payment System (MIPS) 2020 performance period. Additionally, the MIPS automatic extreme and uncontrollable circumstances policy will be applied to MIPS eligible clinicians for the 2019 MPS performance period as data submission for 2019 will be impacted. 13. Opioid Treatment Programs Audio-only telephone calls will be permitted for the therapy and counseling portions of the weekly bundle of services furnished by Opioid Treatment Programs if the beneficiaries do not have access to two-way audio/video communications technology. 14. Teaching Physicians, Residents and Moonlighting Regulations The teaching physician regulations are amended to allow the teaching physician to provide supervision either with physical presence or be present through interactive telecommunications technology during the key portion of residents’ service. Residents may also provide services from quarantine, such as reading the results of tests and other imaging studies under the supervision of the teaching physician by interactive telecommunications technology. This change does not apply in the case of surgical, high risk, interventional, or other complex procedures, services performed through an endoscope, and anesthesia services. CMS clarified that Medicare may make payment under the PFS for teaching physician services, including under the primary care exception, when a resident furnishes telehealth services to beneficiaries under direct supervision of the teaching physician which is provided by interactive telecommunications technology. CMS is also permitting the hospital that is paying the resident’s salary and fringe benefits for the time that the resident is at home or in the home of a patient that is already a patient of the physician or hospital, but performing patient care duties within the scope of the approved residency program, to claim that resident for indirect medical education and direct graduate medical education purposes. During the emergency, “moonlighting,” or services of residents that are not related to their approved GME programs and are performed in the inpatient setting of a hospital in which they have their training program, are separately billable physicians’ services for which payment can be made. 15. Psychiatric Hospitals CMS has deleted several references to 42 C.F.R. § 482.12(c) in 42 C.F.R. § 492.61(d) to clarify that the latter’s provisions apply to all patients, not only Medicare beneficiaries. 16. Innovation Center Models CMS is now permitting certain beneficiaries to obtain the set of Medicare Diabetes Prevention Program (MDPP) services more than once per lifetime, increase the number of virtual make-up sessions, and allow certain MDPP suppliers to deliver virtual MDPP sessions on a temporary basis. CMS is also implementing a 3-month extension to the Comprehensive Care for Joint Replacement model performance year 5 and amending the CJR extreme and uncontrollable circumstances policy to be applicable to episodes impacted by the COVID-19 pandemic. 17. Remote Physiologic Monitoring Remote physiologic monitoring services can temporarily be furnished to new patients, as well as to established patients. Further, consent to receive RPM services can be obtained once annually, including at the time services are furnished, during the duration of the COVID-19 public health emergency. RPM codes can also be used for physiologic monitoring of patients with acute and/or chronic conditions. 18. Evaluation and Management (E/M) Services CMS is finalizing, on an interim basis, separate payment for CPT codes 98966-98968 and CPT codes 00441-99443. For these codes, work RVUs as recommended by certain AMA Committees are finalized: 0.25 for CPT code 98966 0.50 for CPT code 98967 0.75 for CPT code 98968 0.25 for CPT code 99441 0.50 for CPT code 99442 0.75 for CPT code 99443. Additionally, CMS is finalizing the recommended direct PE inputs which consist of 3 minutes of post-service RN/LPN/MTA clinical labor for each time code. CMS will also not conduct reviews to consider whether those services were furnished to established patients, and the services may be furnished to new patients as well. To facilitate billing of CPT codes 98966-98968, CMS is designating these codes as “sometimes therapy” services that would require the private practice occupational therapist, physical therapist, and speech-language pathologist to include the corresponding GO, GP, or GN therapy modifier on those claims. CMS is also permitting the office/outpatient E/M level selection for office/outpatient services when furnished via telehealth to be based on MDM or time, with time defined as all of the time associated with the E/M on the day of the encounter. Any requirements regarding documentation of history and/or physical exam in the medical record are removed for office/outpatient services via telehealth, though E/M visits should continue to be documented as necessary to ensure quality and continuity of care. 19. National Coverage Determination and Local Coverage Determination Requirements Certain National Coverage Determinations and Local Coverage Determinations of covered items or services will not apply during the COVID-19 Pandemic, including: face-to-face and in person requirements; clinical indications for certain respiratory, home anticoagulation management and infusion pump policies; and requirements for consultations or services furnished by or with the supervision of a particular medical practitioner or specialist. 20. Part C and Part D Quality Star Ratings CMS is modifying the calculation of the 2021 and 2022 Medicare Part C and D Star Ratings in several ways to address the expected disruption to data collection. The interim final rule: A. replaces the 2021 Star Ratings measures calculated based on HEDIS and Medicare CAHPS data collections with earlier values from the 2020 Star Ratings (which are not affected by the public health threats posed by COVID-19); B. establishes how CMS will calculate or assign Star Ratings for 2021 in the event that CMS’ functions become focused on only continued performance of essential agency functions and CMS and/or its contractors do not have the ability to calculate the 2021 Star Ratings; C. modifies the current rules for the 2021 Star Ratings to replace any measure that has a data quality issue for all plans due to the COVID-19 outbreak with the measure-level Star Ratings and scores form the 2020 Star Ratings; D. in the event that CMS is unable to complete HOS data collection in 2020 (for the 2022 Star Ratings), replaces the measures calculated based on HOS data collections with earlier values that are not affected by the public health threats posed by COVID-19 for the 2022 Star Ratings; E. removes guardrails for the 2022 Star Ratings; and F. expands the existing hold harmless provision for the Part C and D Improvement measures to include all contracts for the 2022 Star Ratings. 21. Ordering Medicaid Home Health Services In addition to physicians, licensed practitioners such as NPs and PAs may order Medicaid home health services during the existence of the PHE for the COVID-19 pandemic. These services include part-time or intermittent nursing, home health aide services, medical supplies, equipment, and appliances, and may include therapeutic services. This change applies to who can order home health services covered under 42 C.F.R. § 440.70(b)(1)–(4). It does not expand the benefit categories where these items can be covered. 22. Origin and Destination Requirements Under the Ambulance Fee Schedule The list of destinations for covered ambulance transportation is expanded to include all destinations, from any point of origin, that are equipped to treat the condition of the patient consistent with EMS protocols established by state and/or local laws where the services will be furnished. 23. Inpatient Hospital Services Furnished Under Arrangements Outside the Hospital The “under arrangements” policy is changed to allow hospitals broader flexibilities to furnish inpatient services, including routine services, outside the hospital. For services provided for discharges for patients admitted to the hospital during the PHE for COVID-19 beginning March 1, 2020, if routine services are provided under arrangements outside the hospital to its inpatients, these services are considered as being provided by the hospital. 24. Advance Payments to Suppliers Furnishing Items and Services under Part B Under Medicare Part B, the definition of advance payments to suppliers furnishing items and services will change from a payment made by the carrier to a payment made by the contractor, and payments under emergency exceptions will be permitted. CMS is also increasing the advance payment limit from 80 percent of the anticipated payment to 100 percent.

The COVID-19 pandemic has led to rapid and drastic changes to health care delivery in the United States, including as it relates to arrangements between health care providers and physicians that may implicate the federal physician self-referral law, or “Stark Law.” On March 30, 2020, the Centers for Medicare & Medicaid Services (“CMS”) issued much-anticipated nationwide blanket waivers of sanctions under the Stark Law for “COVID-19 Purposes” (the “Stark Blanket Waivers”), which are available here. The Stark Blanket Waivers have a retroactive effective date of March 1, 2020 and will continue through the end of the Public Health Emergency (“PHE”) that was declared related to the COVID-19 outbreak. The Stark Blanket Waivers, which were issued under Section 1135 of the Social Security Act, permit numerous flexibilities to ensure that: “(1) sufficient health care items and services are available to meet the needs of individuals enrolled in the Medicare, Medicaid, and CHIP programs; and (2) health care providers . . . that furnish such items and services in good faith, but are unable to comply with one or more of the specified requirements of [Stark] as a result of the consequences of the COVID-19 pandemic, may be reimbursed for such items and services and exempted from sanctions for such noncompliance, absent the government’s determination of fraud or abuse.” These flexibilities provide welcome relief for health care providers that are facing much uncertainty and overwhelm in this time of rapid and drastic change. Stark is a strict liability law with very significant civil penalties and prohibitions on billing the Medicare program associated with its violation. However, during the PHE, CMS will reimburse for services provided pursuant to referrals that would otherwise violate Stark, and will not impose penalties, as long as the Stark Blanket Waivers are followed. It is important to keep in mind that each Stark Blanket Waiver is limited to the specific circumstances described in the waiver. Health care providers are required to satisfy every condition of the Stark Blanket Waiver in order to take advantage of it, so special attention should be paid to the requirements. CMS cautioned that any remuneration described in the Stark Blanket Waivers must be directly between the entity and: (1) the physician or the physician organization in whose shoes the physician stands under 42 C.F.R. § 411.354(c); or (2) the immediate family member of the physician. Further, CMS cautioned that the remuneration and referrals described in the Stark Blanket Waivers must be solely related to “COVID-19 Purposes.” CMS specifies that “COVID-19 Purposes” means, for purposes of the Stark Blanket Waivers: Diagnosis or medically necessary treatment of COVID-19 for any patient or individual, whether or not the patient or individual is diagnosed with a confirmed case of COVID-19; Securing the services of physicians and other health care practitioners and professionals to furnish medically necessary patient care services, including services not related to the diagnosis and treatment of COVID-19, in response to the COVID-19 outbreak in the United States; Ensuring the ability of health care providers to address patient and community needs due to the COVID-19 outbreak in the United States;  Expanding the capacity of health care providers to address patient and community needs due to the COVID-19 outbreak in the United States; Shifting the diagnosis and care of patients to appropriate alternative settings due to the COVID-19 outbreak in the United States; or Addressing medical practice or business interruption due to the COVID-19 outbreak in the United States in order to maintain the availability of medical care and related services for patients and the community. There are eighteen Stark Blanket Waivers. It is critical to know that each waiver is specific in its requirements and application, so health care providers should not rely on this summary in order to use a Stark Blanket Waiver. Instead, providers should carefully review the details of each waiver prior to making a decision to proceed with an arrangement in reliance on a waiver. A few of the Stark Blanket Waivers are briefly summarized as follows: Remuneration to a physician that is above or below fair market value for services personally performed by the physician. Rental charges paid to a physician that are below fair market value. Remuneration to a physician in the form of medical staff incidental benefits or non-monetary compensation that exceeds the limits set forth in applicable Stark regulations. Loans to a physician with below fair market value interest rates or on terms that are not available from a traditional lender. Referrals by a physician owner of a hospital that temporarily expands its facility capacity above its baseline number without prior application and approval of the facility expansion as required under Stark. Referrals by physicians in a group practice in a location that does not qualify as the “same building” or “centralized building” as typically required under Stark. Referrals by a physician to an entity with which the physician has a compensation arrangement that does not satisfy the writing or signature requirements of the applicable Stark exception, as long as all of the other requirements of the exception are met (unless the other requirements have been waived under one or more of the Stark Blanket Waivers). While no data or notification is required to be submitted to CMS in order to use the Stark Blanket Waivers, parties seeking to utilize the Stark Blanket Waivers should develop and retain records related to the use of the waivers in order to support the fact that the decision to use the waivers was for COVID-19 Purposes, and to document that each requirement of the waiver was satisfied. These records must be made available to the Secretary of the Department of Health and Human Services upon request. At the end of the document setting forth the Stark Blanket Waivers, CMS provided two pages of examples of the application of the Stark Blanket Waivers. CMS clarified that unless a Stark Blanket Waiver expressly applies only to a specific type of entity (e.g., a home health provider), then the examples that CMS provided which reference a hospital would apply to any entity that furnishes designated health services. Finally, CMS provided the email address for individuals to use to submit inquiries about the blanket waivers, available here: 1877CallCenter@cms.hhs.gov. We note that individual waivers of sanctions under the Stark Law are still available and may be granted upon request submitted to the email address noted above. Such individual waiver requests are a good option for a party to consider if an existing or proposed arrangement does not appear to qualify for a Stark Blanket Waiver (or an existing Stark exception). * * * For assistance in determining whether an existing or proposed arrangement complies with a Stark Blanket Waiver and/or for inquiries regarding individual waiver requests, please contact the authors or your regular Dorsey & Whitney LLP attorney. Dorsey is closely monitoring the rapidly evolving legal landscape related to the COVID-19 pandemic. You can access Dorsey’s health law blog related to health law updates, available here. You can also access Dorsey’s coronavirus resource center, which contains a wide variety of legal resources related to the coronavirus outbreak, available here.

On March 30, 2020, the Centers for Medicare & Medicaid Services (“CMS”) published a compilation of COVID-19 Emergency Declaration Blanket Waivers for Health Care Providers (each, a “Blanket Waiver”). Section 1135 of the Social Security Act gives CMS the authority to issue waivers that ease requirements for providers affected by an emergency if: (1) the President makes an emergency declaration under the Robert T. Stafford Disaster Relief and Emergency Assistance Act, 42 U.S.C. 5121-5207 (the “Stafford Act”); and (2) the Secretary of the Department of Health and Human Services declares a Public Health Emergency (“PHE”), both of which have now occurred in light of COVID-19. CMS is permitted to issue both blanket waivers and provider/supplier requested waivers on a case-by-case basis. Blanket waivers apply to all applicable providers and suppliers, while individual waivers apply only to the requesting provider or supplier. A provider or supplier need not request a provider/supplier-specific waiver of a requirement if CMS has issued a blanket waiver addressing the same requirement. It is important to note that 1135 waivers apply solely to federal requirements and do not apply to state licensure or other requirements. Any applicable state requirements (e.g., licensure) must also be addressed with the relevant state agency. Another important note of caution is that these 1135 waivers often include specific details and requirements. It is critical for health care providers to review the waivers carefully before taking action under them. To that end, providers should visit the CMS Coronavirus Waivers & Flexibilities website, here, to locate the specific guidance and requirements from CMS about the type of program waiver(s) being sought. CMS has provided numerous Frequently Asked Questions (“FAQ”) documents and provider-specific fact sheets that detail the details about and limits of the available waivers and flexibilities for each type of provider (hospital, skilled nursing facility, physicians, laboratories, home health providers, etc.). Additionally, this website contains links to all of the waivers provided in each state. The following is a summary of the Blanket Waivers CMS has made available to providers and suppliers on March 30, 2020. These Blanket Waivers are retroactively effective back to March 1, 2020 and will continue through the end of the emergency declaration. I. Hospital Waivers The Blanket Waivers include significant regulatory relief for hospitals. The following is a summary of the hospital-specific Blanket Waivers, and here is a CMS Fact Sheet that was published for hospitals to further explain these specific Blanket Waivers: a. Temporary Expansion Sites (a.k.a. Hospitals Without Walls) Under this Blanket Waiver, hospitals are permitted to offer health care services in locations that are not currently part of the hospital. Previously, hospitals would have been required to meet Life Safety Code and other regulatory provisions and obtain approvals to provide services in a new location. This waiver will help hospitals set up temporary expansion sites to offer inpatient services (e.g., nursing, room and board) in locations such as shell space in a hospital, parking structures, dormitories and the like – as long as the hospital exercises control and oversees the services provided at the location, and as long as the location is approved by the state (to ensure safety and comfort for patients and staff). CMS is also allowing currently enrolled ambulatory surgery centers (“ASCs”) to temporarily enroll as hospitals by calling the COVID-19 Provider Enrollment Hotline to complete and sign an attestation form in order to enroll and provide services during the PHE as a hospital. CMS also encourages other entities (e.g., freestanding emergency departments which are not currently allowed to enroll in Medicare) to call the COVID-19 Provider Enrollment Hotline to complete and sign an attestation form in order to enroll and provide services during the PHE. Further, CMS is allowing hospitals to change their provider-based locations to address patient needs, as well as allowing additional flexibilities related to inpatient services furnished under arrangements. Moreover, hospitals are permitted to screen patients at locations off of a provider’s campus, in order to avoid the spread of COVID-19. Further, for surge facilities in off campus departments, CMS is waiving the requirements to have policies and procedures for evaluating emergencies so these facilities do not need to focus time on drafting policies and procedures but rather can focus on patient care needs. b. Relaxed Paperwork, Policies, Cost Reporting, Filing Deadlines and Enrollment Requirements For hospitals that are impacted by a widespread outbreak of COVID-19, the timeframes for providing patients a copy of their medical records are waived, as are the requirements related to visitation and seclusion. Additionally, CMS is granting a 30-day post-discharge requirement to complete medical records, CMS is waiving medical records department staffing requirements, and also waiving specific requirements for the form and content of the medical record and the medical record completion requirements. Further, verbal orders can be authenticated more than 48 hours after the fact (although read-back verification is still required). CMS is also waiving requirements to provide information about advanced directives to patients. Further, To ensure that hospitals and critical access hospitals focus on patient care and ensuring patients are discharged in an appropriate setting, as opposed to focusing on the paperwork and other regulatory obligations, CMS is waiving the detailed regulatory paperwork and other requirements related to discharge planning. For example, CMS recognizes that during the PHE, hospitals may not be able to use specific quality metrics and other data, or a comprehensive list of nursing homes in the area, to select a nursing home or home health agency. However, hospitals are still required to work with families to ensure that the discharge meets patients’ care needs. Further, CMS is waiving the entire condition of participation related to utilization review plans and committees, nursing care plans, having available a current therapeutic diet manual, developing and implementing emergency preparedness policies and procedures and communication plans, as well as waiving the detailed provisions governing a hospital’s quality assessment and performance improvement program (although hospitals must still have such a program in place). CMS has established a toll-free hotline for all providers as well as significant flexibilities in provider enrollment. See here for additional information from CMS on provider enrollment relief, as well as our previous blog post on this topic, available here. Further, CMS is waiving the signature and proof of delivery requirements for Part B drugs and durable medical equipment (although the delivery and the fact that a signature could not be obtained due to COVID-19 should be documented in the record). Additionally, CMS is delaying the cost-report filing deadlines until June and July, and CMS is extending the data submission deadlines for hospitals on the reporting of occupational mix of employees until August 3, 2020. Further, Medicare Administrative Contractors (“MACs”), Qualified Independent Contractors (“QICs”), and Independent Review Entities (“IREs”) are allowed to grant extensions to providers on appeals and are permitted to offer other flexibilities on filings and deadlines. c. Critical Access Hospitals (“CAHs”) Without Walls CAHs are now permitted to exceed their 25 bed limit and the 96 hour length of stay limit. CMS is also permitting CAHs to treat patients in urban areas (they typically must be located in a rural area) as needed in order to establish surge locations. Further, CMS is waiving the restrictions on CAHs’ ability to establish off campus provider based locations, and to establish the normally restricted co-location arrangements with other providers. CMS is waiving the minimum personnel qualification requirements at CAHs for clinical nurse specialists, nurse practitioners and physician assistants, and CMS is deferring to the state for the requirements of staff licensure, certification or registration, which will allow more flexibility to CAHs in states where federal requirements are more stringent. d. Distinct Part Units CMS is also now allowing hospitals to house acute care patients in excluded distinct part units (as long as the unit’s beds are appropriate for acute inpatients). Hospitals are permitted to bill for the care provided in the distinct part unit under the Inpatient Prospective Payment System. Providers should annotate in the medical record to explain that the care was provided in the distinct part unit due to capacity issues related to the PHE. Hospitals are also now permitted to provide care in acute care beds and units for patients who would normally be treated in distinct part psychiatric units or distinct part rehabilitation units, as long as the acute beds and units are appropriate for such patients. Hospitals should continue to bill under the Inpatient Psychiatric or Inpatient Rehabilitation Prospective Payment System for those patients, and annotate in the medical record to explain that the care was provided in the acute care unit due to capacity issues or other exigent circumstances related to the PHE. e. Telemedicine CMS is waiving telemedicine restrictions on hospitals and CAHs to make it easier for these providers to provide telemedicine for their patients through agreements with off-site hospitals, in order to improve access to specialty care. f. Workforce CMS is waiving the sterile compounding requirements to allow the re-use of face masks. CMS is also waiving the 2-year reappointment period for medical staff re-credentialing, the requirement that patients in a hospital be under the care of a physician (to allow other practitioners like physician assistants and APRNs to be used to the fullest extent possible), and CMS is waiving the requirement for CRNAs to work under the supervision of a physician. Further, CMS has stated that Hospitals do not have to designate in writing the personnel qualified to perform specific respiratory care procedures or the amount of supervision required for personnel to carry out those procedures. II. Long-Term Care, Skilled Nursing Facilities, and Nursing Facility Waivers The Blanket Waivers provide a number of flexibilities related to nursing services. See here for the CMS fact sheet published specifically for long term care facilities. CMS is waiving the 3-day prior hospitalization requirement for coverage of a skilled nursing facility (“SNF”) stay, waiving the timeframe requirements for certain data submission for SNFs and long-term care (“LTC”) facilities, and allowing nursing homes to suspend pre-admission screening and annual resident review assessments. Certain physical environment requirements are now waived, allowing for expanded use of non-SNF buildings or non-resident rooms in a LTC facility for patients in certain emergency circumstances. To promote social distancing: requirements that residents participate in-person in resident groups are waived; requirements related to room-sharing and moving a resident’s room are waived for the purpose of grouping or separating residents with respiratory illness symptoms and/or residents with a confirmed COVID-19 diagnosis from residents without these symptoms or diagnosis; and physicians and non-physician practitioners may conduct visits through telehealth options when previously the visits were required to be in-person. CMS is also partially waiving training and certification requirements required for nurse aids employed for longer than four months at a facility in order to assist with potential staffing shortages. CMS has waived certain resident transfer and discharge requirements in particular circumstances, though advance notification and receiving facility agreements are generally still required, and related care planning requirements are also waived in certain circumstances. Additionally, CMS is delaying the cost-report filing deadlines until June and July, and CMS is extending the data submission deadlines for hospitals on the reporting of occupational mix of employees until August 3, 2020. Further, Medicare Administrative Contractors (“MACs”), Qualified Independent Contractors (“QICs”), and Independent Review Entities (“IREs”) are allowed to grant extensions to providers on appeals and are permitted to offer other flexibilities on filings and deadlines. III. Home Health, Hospice, ESRD, and DMEPOS Waivers CMS has provided FAQ documents on these waivers for home health, here; for hospice, here; for ESRD Facilities, here; and for DME Suppliers, here. Under the Blanket Waivers, CMS provided extensions for home health, hospice, and ESRD providers to complete certain assessment required for Medicare reimbursement. CMS also waived certain home health, hospice and ESRD in-person assessment, visit, and supervision requirements to reduce the need for ordinary course check-ins and to allow for greater use of telehealth. In addition, hospices are relieved of the requirement to provide non-core hospice services, such as physical therapy, occupational therapy, and speech-language pathology. In providing additional flexibility in timing and in-person visits, CMS’s goal is to support containment efforts for at-risk populations and to free up professional resources to focus on treatment of those infected with coronavirus and to focus on operations related to the pandemic. In addition, CMS is waiving certain routine audits, maintenance, and certification requirements for ESRD Facilities and ESRD Facility staff. Again, CMS is attempting to free up resources and provide flexibility to support providers’ focus on pandemic-related efforts. CMS authorized the establishment of Special Purpose Renal Dialysis Facilities (“SPRDF”) to mitigate transmission among the at-risk population. Such facilities do not require a federal survey to be completed before providing services. CMS is allowing physicians that are appropriately credentialed at a certified dialysis facility to provide care at a “designated isolation location” such as a SPRDF without separate credentialing. Dialysis services may now also be provided in nursing homes and SNFs, so long as the services and necessary equipment and supplies are provided by personnel of the resident’s usual Medicare-certified dialysis facility. In an effort to expedite supply of and reimbursement for DMEPOS, CMS is waiving the replacement requirements (such as the face-to-face requirement, a new physician’s order, and new medical necessity documentation) for DMEPOS that are lost, destroyed, irreparably damaged, or otherwise rendered unusable. DMEPOS suppliers must still provide a narrative description about why the equipment must be replaced. IV. Practitioner Licensure, Provider Enrollment, Appeals, and Medicaid/CHIP Waivers CMS has provided a specific fact sheet describing the waivers and flexibilities available for physicians and other clinicians, available here. The Blanket Waivers are intended to ease the burden on the health system in order to allow providers to focus on patient care. To that end, CMS is temporarily waiving the Medicare reimbursement requirements that out-of-state practitioners be licensed in the state in which they are providing services when they are licensed in another state when the following four conditions are met: The practitioner must be enrolled in Medicare; The practitioner must have a valid license to practice in the state which relates to his or her Medicare enrollment; The services must be furnished, whether in-person or remote via telehealth, in a state in which the emergency is occurring in order to contribute to relief efforts in his or her professional capacity; and The practitioner must not be excluded in any state that is part of the PHE. Please note that the foregoing Medicare reimbursement waiver for licensure does not waive state or local licensure requirements. As a result, providers must review the state licensure requirements in each jurisdiction prior to delivering telehealth to patients in that location. Please see the blog post we published on this topic of telehealth opportunities here. Additionally, CMS has taken a number of steps to ease the provider enrollment requirements. See here for additional information from CMS on provider enrollment relief, as well as our previous blog post on this topic, available here. CMS has set up a hotline for physicians and non-physician practitioners to enroll and receive temporary Medicare billing privileges. Additionally, CMS has taken the following steps to facilitate the enrollment of providers in the wake of the COVID-19 outbreak, including: Waiver of certain screening requirements, including application fees, background checks, and site visits; Postponement of revalidation actions; Allowing licensed providers to render services outside their state of enrollment;  Expediting pending or new applications;  Easing telehealth restrictions; and Allowing physicians and non-physician practitioners to terminate opt-out status early and enroll in Medicare. Regarding appeals, the new waivers grant broad powers to MACs, QICs, and IREs to relax the requirements of federal regulations regarding the appeals process in FFS, and Parts C and D. MACs, QIEs, and IREs are instructed to allow extensions to file an appeal and to permit the waiver of requests for timeliness requirements for additional information to adjudicate appeals. MACs, QICs, and IREs are now allowed to process an appeal even with incomplete Appointment of Representation forms as outlined in federal regulations. Additionally, MACs, QICs, and IREs can now process appeals that do not meet the required elements of those same federal regulations. MACs, QICs, and IREs are given broad flexibility with respect to other parts of the appeals process so long as good cause requirements are satisfied. Finally, regarding Medicaid and CHIP, the new waivers permit states to request approval that certain statutes and implementing regulations be waived under section 1135. To request such an approval, states may submit an 1135 waiver request directly to their Center for Medicaid and CHIP Services (CMCS) state lead or Jackie Glaze, Acting Director, Medicaid and CHIP Operations Group, Center for Medicaid and CHIP Services at CMS by e-mail (Jackie.Glaze@cms.hhs.gov) or by letter. CMS sets forth a number of examples of the kinds of requests that states can make under this waiver, including: Waiver of prior authorization requirements for FFS programs; Waiver of out-of-state requirements for providers to provide care to another state’s Medicaid enrollees impacted by COVID-19; Temporary suspension of provider enrollment and revalidation requirements to increase access to care; Temporary waiver of state licensure requirements; Temporary suspension of requirements for pre-admission and annual screening requirements for nursing home residents. CMS encourages states to assess their needs and take advantage of these waivers. To assist states with the waiver request process and provide additional guidance, CMS released the Medicaid and CHIP Disaster Response Toolkit, which can be found here. Further, the CMS Coronavirus Waivers & Flexibilities website, here, contains a link to each state’s request for waivers and the responses from CMS. V. Stark Waivers On the same date, CMS also issued much-anticipated Blanket Waivers of sanctions under the federal physician self-referral law, or “Stark Law,” for “COVID-19 Purposes.” These Blanket Waivers are set forth here. Please see our separate post, available here, with detailed information about these Stark Law Blanket Waivers. * * * If you have questions about the new CMS waivers, please contact the authors or your regular Dorsey & Whitney LLP attorney. Dorsey is closely monitoring the rapidly evolving legal landscape related to the COVID-19 pandemic. You can access Dorsey’s health law blog related to health law updates, available here. You can also access Dorsey’s coronavirus resource center, which contains a wide variety of legal resources related to the coronavirus outbreak, available here.

The COIVD-19 pandemic is placing new and unprecedented demands on both taxable and tax-exempt employers and their employees. One option many employers may not have previously considered is the use of a tax-exempt employee assistance fund. Depending on the structure of the fund, declaration of qualified disaster is an important requirement for the fund to issue financial assistance to individuals. Although the Internal Revenue Service (“IRS”) has yet to issue official guidance confirming the COVID-19 pandemic as a “qualified disaster” under Section 139 of the Internal Revenue Code (the “Code”), the President declared a national emergency under the Robert T. Stafford Disaster Relief and Emergency Assistance Act (“Stafford Act”) due to extraordinary circumstances resulting from COVID-19. A qualified disaster relief payment is defined under Section 139(c)(2) of the Code to include a federally declared disaster as defined by Section 165(i)(5)(A) of the Code, which defines the term as any disaster subsequently determined by the President of the United States to warrant assistance by the Federal Government under the Stafford Act. If employers do not already have an established employee assistance fund, deciding and implementing the most beneficial structure during a crisis can seem daunting. We have experience forming and implementing employee assistance funds, and quickly and efficiently navigating the application for tax-exempt status with the IRS. Below is an overview of issues employers should consider when contemplating a new employee assistance fund program. What is an employee assistance fund? The term employee assistance fund (“EAF”) is generally used to describe several types of employer-sponsored Section 501(c)(3) (all subsequent references to “Section” shall mean Sections of the Code) charitable tax-exempt organizations designed to provide emergency, need-based financial assistance to an employer’s work force in the event of disaster or personal hardship impacting individual employees or their families. EAFs are typically structured as a public charity, a donor advised fund, or a private foundation. A Section 501(c)(3) EAF must serve a charitable class, which must be large enough or sufficiently indefinite that the community as a whole, rather than a pre-selected group of people, benefits from the EAF grants. EAFs may restrict benefits to a certain company’s employees and still serve a charitable class so long as the EAF’s assistance policy is open-ended and include employees affected by any current or future disasters or emergencies. What are the distinguishing characteristics of an EAF structured as a public charity? An EAF established as a public charity described in Sections 509(a)(1) and 170(b)(1)(A)(vi) receives its funding primarily through donations from the general public, usually through donations from the company’s individual employees. A public charity EAF can provide financial assistance in response to any type of disaster or employee emergency hardship, so long as the related employer does not control the organization. Generally, these requirements are met when non-executive (i.e., rank and file) employees comprise a significant portion of both the board of directors and the committee that selects eligible individuals for need-based distributions from the EAF. Unlike a donor advised fund or a private foundation, a public charity EAF can provide assistance to eligible individuals in response to any type of disaster or employee emergency hardship situation. What are the distinguishing characteristics of an EAF structured as a donor advised fund? A donor advised fund is a community foundation-type of organization that maintains separate funds or accounts on behalf of individual or corporate donors. The donors then receive advisory privileges over the distribution of the donated funds, but such distributions must still be made for charitable purposes. While a donor advised fund is usually classified as a public charity, important distinctions for donor advised EAFs are subject to additional restrictions. Typically, a donor advised fund (whether or not an EAF) cannot make grants to individual persons. However, a donor advised EAF can make grants to individual employees and their family members if: the EAF makes need-based distributions adequately documented by the EAF; the EAF’s sole purpose is to provide relief after a qualified disaster as defined in Section 139; and eligible recipients are selected by a committee independent from the sponsoring employer. What are the distinguishing characteristics of an EAF structured as a private foundation? EAFs structured as private foundations are typically funded solely through donations by an employer, and not by contributions from individual employees or the general public. Like the donor advised EAFs, an EAF structured as a private foundation may only provide need-based assistance to employees or family members impacted by a qualified disaster as defined in Section 139. Also, the private foundation EAF’s selection committee must be independent from the employer, and payments to or for the benefit of individuals who are directors, officers, or trustees of the private foundation may subject the foundation to the self-dealing rules under Section 4941. Are payments from an EAF taxable to the individual recipients? No. Payments from a Section 501(c)(3) EAF as a result of a disaster or emergency hardship are considered to be gifts and are excluded from the recipient’s gross income under Section 102. Are disaster relief payments taxable if received directly from an employer and not made through an EAF? It depends. If the payment meets the definition of a qualified disaster relief payment under Section 139 for qualified disaster expenses that are not otherwise covered by insurance or other reimbursements, such payments are not subject to income tax, self-employment tax, or other employment taxes even if made directly from an employer. Are donations to an EAF tax-deductible? If recognized by the IRS as a Section 501(c)(3) organization, donations by individuals or corporations to an EAF may eligible as a deduction as a charitable contribution under Section 170. Changes included in the recently enacted Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) includes expanded Section 170 deductions for both individuals (itemizers and non-itemizers) and corporations. Are there restrictions on EAF payments to individuals? Yes, particularly when made by an EAF structured as a donor advised fund or a private foundation that are limited to Section 139 qualified disaster relief payments. As relevant to payments from an EAF, qualified disaster relief payments are defined in Section 139(b) to include any amount paid (regardless of the source) for the benefit of an individual: to reimburse or pay reasonable and necessary personal, family, living, or funeral expenses incurred as a result of a qualified disaster; to reimburse or pay reasonable and necessary expenses incurred for the repair or rehabilitation of a personal residence or repair or replacement of its contents to the extent that the need for such repair, rehabilitation, or replacement is attributable to a qualified disaster; and by a person engaged in the furnishing or sale of transportation as a common carrier by reason of the death or personal physical injuries incurred as a result of a qualified disaster. Qualified disaster relief payments do not include payments for expenses paid for by insurance or other reimbursements, or income replacement payments, such as payments of lost wages, lost business income, or unemployment compensation. Can an EAF provide assistance to other businesses? It depends, but an EAF structured as a public charity likely has the most latitude to provide financial assistance to other businesses as it is not limited to qualified disaster relief-type payments. For example, a charitable organization may provide assistance to a for-profit business if the assistance is a reasonable means of accomplishing a charitable purpose (e.g., relief of the poor and distressed or lessening the burdens of government), and any benefit to private interests is incidental to the accomplishment of such charitable purpose.

With the aim of enabling providers to focus attention and resources on fighting the COVID1-19 pandemic, CMS announced over the weekend that it intends to alleviate some of Medicare participating providers' and suppliers' financial burden by expanding its Medicare accelerated and advance payment (AAP) program to a broader group of Medicare Part A providers and Part B suppliers for the duration of the public health emergency. Medicare accelerated and advance payments are typically employed for emergency funding for scenarios in which claims submissions or processing is disrupted; the announcement is at once historic and yet also wholly in scope with the scale of and disruption caused by the pandemic. The expedited payments have been employed usually during natural disasters such as tornadoes, flooding, and the like, and may also be used during a national emergency. Lawmakers are recognizing the scale and scope of what providers are facing (and will continue to face), so CMS is expanding the Medicare accelerated and advance payments program eligibility to all applicable Medicare providers and suppliers, throughout the US, during the public health emergency related to COVID-19. The payment amount will vary by applicable provider or supplier depending on what amount is requested; the payments are potentially substantial. The permitted payment amounts are based on applicants’ historical Medicare payment amount for the requested time period and as permitted by category. Most providers and suppliers may request up to 100% of their historical Medicare payment amount for a three-month period. Inpatient acute care hospitals, children’s hospitals, and certain cancer hospitals are able to request up to 100% of their historical Medicare payment amount for a six-month period. Critical access hospitals may request up to 125% of their historical Medicare payment amount for a six-month period. In addition, CMS has extended the repayment date to begin 120 days after the payment is issued; the timeline for repayment again varies by organization type but is not less than 210 days. Providers and suppliers interested in seeking these payments may request the appropriate specific amount using the Accelerated or Advance Payment Request form provided on your Medicare Administrative Contractor’s (MAC’s) website. For example, the MAC, WPS, has recently updated its AAP application form, available here, which can simply be e-mailed to WPS at the email address located at the bottom of the one-page application. In order to be able to qualify for this expansion, a few conditions apply, and are worth double-checking as to whether any of these are true of your organization. The requesting providers or suppliers: Must have billed Medicare for claims within 180 days immediately prior to the date of signature on the provider’s/supplier’s request form; Must not be in bankruptcy proceedings, nor be under active medical review or program integrity investigation; and Must not have any outstanding delinquent Medicare overpayments. If any of the above conditions apply, then your organization would not be eligible to apply under this COVID-specific expansion. This expansion of the AAP program takes effect immediately, and CMS aims to issue payments within seven days of a request. Details about reconciliation and recoupment, as well as instructions as to how to apply, may be found in the CMS fact sheet found here. If you have any questions about the announcement or the application process, please contact the author(s) or your regular Dorsey attorney or Dorsey Health Strategies consultant.

On March 27, 2020, the President signed into law the “Coronavirus Aid, Relief, and Economic Security Act’’ (“CARES Act”). The CARES Act is the third phase of the federal government’s response to the coronavirus following two other laws to support American families and address health sector needs that were approved on March 6, 2020 (Phase I here) and March 18, 2020 (Phase II here). The CARES Act includes provisions which provide cash payments and other resources to help individuals, small businesses, state and local governments and hospitals/healthcare providers. The CARES Act includes four sections (called “Titles”) and each title addresses a different topic. This e-update summarizes Title III of the CARES Act titled “Supporting America’s Health Care System in the Fight Against the Coronavirus”. Title III provides much needed financial assistance to the health care industry, as well as additional guidance and other provisions which provide information on waivers and other benefits to help hospitals and others who are on the front lines of fighting the COVID-19 pandemic. The following is a summary of the major provisions of Title III, organized in order by section numbers under the CARES Act but does not address subtitle B – Education Provisions and subtitle C – Labor Provisions. We will provide links to summaries of other provisions in the CARES Act prepared by our colleagues throughout the firm as they become available. Click here to read the summary.

CMS announced today (with the details found here in its answers to Frequently Asked Questions) that in acknowledgment of the extreme circumstances posed by COVID-19, it will exercise enforcement discretion with respect to any Physician Payments Sunshine Act Open Payments reporting that is submitted after the March 31, 2020 deadline. CMS explained that while it does not have authority to delay the submission deadline (since that deadline is set by federal statute), CMS is sensitive to the challenges caused by the COVID-19 pandemic, and will exercise enforcement discretion by considering the impact of these circumstances on an entity’s ability to submit the information on time. Entities that submit data after the deadline should include the phrase “COVID-19 Impact” in an assumption statement along with the explanation about their COVID-19-related circumstances. If you have any questions about this year’s Open Payments reporting or how to submit data, please contact the author or your regular Dorsey attorney or Dorsey Health Strategies consultant.

On Monday, March 23, 2020, the Center for Medicare and Medicaid Services (“CMS”) released Frequently Asked Questions on Medicare Provider Enrollment Relief related to COVID-19 (“FAQs”), available here. The recent Public Health Emergency declaration by the Secretary of the Department of Health and Human Services provided a broad 1135 waiver on enrollment screening requirements, application fees, criminal background checks, site visits, and certain licensure requirements. The FAQs provided guidance to providers on how CMS is exercising its authority under the 1135 waiver and on how to navigate enrollment during this emergency period. Expedited Enrollment; Revalidation Included in the FAQs were toll-free hotlines available to provide expedited enrollment. The applicable Medicare Administrative Contractor has the authority to screen and enroll physician and non-physician practitioners in Medicare on a temporary basis telephonically, and, if approved, to provide follow-up documentation of such approval. The effective date of the physician or non-physician practitioner’s billing privileges may be as early as March 1, 2020. Upon the lifting of the Public Health Emergency declaration, those who received temporary billing privileges through the expedited process will be asked to resubmit through the appropriate CMS-855 application. Note that this expedited telephonic enrollment process is only for physician and non-physician practitioners; all other providers and suppliers, including DMEPOS suppliers, must enroll and submit changes of information via the traditional CMS-855 application. Those applications will be expedited if received after March 1, 2020 with processing times of 7 business days for web applications and 14 business days for paper applications. Any applications received prior to March 1, 2020 are being processed in accordance with existing timelines; web applications processed within 45 days and paper applications processed within 60 days. CMS is temporarily ceasing revalidation efforts for all Medicare providers or suppliers. Upon the lifting of the Public Health Emergency, CMS will resume revalidation activities. CMS also is currently postponing DME accreditation and reaccreditation timetables and deadlines. A DME supplier should still comply with accreditation requirements; however, formal accreditation from an accrediting organization will be postponed. CMS still plans to monitor billing activity during the emergency period. Licensure The FAQs clarified that, although the 1135 waiver allowed CMS to waive, on an individual basis, the Medicare requirement that a physician or non-physician practitioner must be licensed in the state in which he or she is practicing, the waiver is not available unless all of the following four conditions are met: 1) the physician or non-physician practitioner must be enrolled in Medicare; 2) the physician or non-physician practitioner must possess a valid license to practice in the state which relates to his or her Medicare enrollment; 3) the physician or non-physician practitioner is furnishing services – whether in-person or via telehealth – in a state in which the emergency is occurring in order to contribute to relief efforts in his or her professional capacity; and 4) the physician or non-physician practitioner is not affirmatively excluded from practice in the state or any other state that is part of the 1135 emergency area. CMS clarified that the 1135 waiver does not have the effect of waiving state or local licensure requirements or any requirement specified by a state or a local government as a condition for waiving its licensure requirements. Those separate state requirements would continue to apply unless waived by the state. If you have any questions about this alert please contact the author or your regular Dorsey attorney.

The Dorsey Health Law blog team keeps readers up-to-date on relevant topics in the health care industry. In order to do so, the members of the blog team communicate regularly with other practice groups within the firm for applicable updates from client publications. For this post, we would like to thank Dorsey’s Jillian Kornblatt and Anabel Cassady for the linked article: FFCRA Employment Benefit Exclusions for Health Care Providers and Emergency Responders

The Dorsey Health Law blog team keeps readers up-to-date on relevant topics in the health care industry. In order to do so, the members of the blog team communicate regularly with other practice groups within the firm for applicable updates from client publications. For this post, we would like to thank Dorsey’s Scott Goldsmith for the linked article: FCC Narrows the TCPA's Emergency Purpose Exception Amid Pandemic While Greenlighting Certain Emergency Messages by Hospitals, Health Care Providers, and Government

Since the COVID-19 outbreak, many health care providers have had a myriad of HIPAA questions, including questions about whether they can share some types of information and, if so, the type of information they can share with first responders who may have been exposed. Today, the Office for Civil Rights (OCR) published guidance outlining the already-existing HIPAA provisions that permit health care providers to share the name or other identifying information of an individual who has been infected with or exposed to the virus, with paramedics, other first responders, law enforcement and public health authorities, available here. The guidance addresses some of the most relevant disclosures that are allowed under HIPAA without the individual’s authorization: when needed for treatment, when required by law to notify a public health authority when necessary to prevent or lessen a serious and imminent threat to the health and safety of a person of the public, and when responding to a request by a correctional institution or law enforcement official that has custody of an inmate or other individual. As a reminder, except for disclosures that are required by law or disclosures for treatment purposes, health care providers are required to make reasonable efforts to limit the information to that which is “minimum necessary” to accomplish the purpose of the disclosure. The OCR also provided a couple of helpful examples that will be relevant to health care providers in the coming days.  Here is one of them: “Example: A covered entity, such as a hospital, may provide a list of the names and addresses of all individuals it knows to have tested positive, or received treatment, for COVID-19 to an EMS dispatch for use on a per-call basis. The EMS dispatch (even if it is a covered entity) would be allowed to use information on the list to inform EMS personnel who are responding to any particular emergency call so that they can take extra precautions or use personal protective equipment (PPE). Discussion: Under this example, a covered entity should not post the contents of such a list publicly, such as on a website or through distribution to the media. A covered entity under this example also should not distribute compiled lists of individuals to EMS personnel, and instead should disclose only an individual’s information on a per-call basis. Sharing the lists or disclosing the contents publicly would not ordinarily constitute the minimum necessary to accomplish the purpose of the disclosure (i.e., protecting the health and safety of the first responders from infectious disease for each particular call).” Additional articles about the application of HIPAA during the COVID-19 outbreak, and other legal resources applicable to the COVID-19 outbreak are available here and here.  Please contact the author or your regular Dorsey attorney with any questions about this guidance.  

As the number of COVID-19 cases increases exponentially, healthcare providers in the United States are bracing for an unmanageable number of critically ill patients.  While it is impossible to predict to what extent the virus will overwhelm hospitals in the U.S., Italy foretells a realistic and grim scenario.  In early March, the Italian College of Anesthesia, Analgesia, Resuscitation and Intensive Care published guidelines educating Italian physicians on how to conduct “disaster medicine” triage—an approach that recognizes the potential need to base triage decisions on which patients are most likely to survive, and prioritizing treatment for those patients.  Traditional disaster medicine or “wartime” triage can result in the denial of medical care for patients with preexisting health conditions or patients above a certain age. The collective hope is that the COVID-19 pandemic never requires hospitals in the U.S. to adopt disaster medicine triage practices.  If it does, healthcare providers will be forced to make triage decisions they have never faced before, and certain patients will succumb to the virus after seeking—and being denied—complete medical care. By its nature, wartime triage (or some variant thereof) will also mean modified rules for a new world.  What may normally be considered medical malpractice will become acceptable under the exigent conditions of the pandemic.  The applicable standard of care, which necessarily turns on the unique circumstances of the situation at hand, will shift, and providers’ actions will be analyzed within the prism of an unprecedented state of emergency.  See, e.g., Estate ex rel. Campbell v. Calhoun Health Servs., 66 So. 3d 129 (Miss. 2011) (applicable standard of care may take into account mass casualty situation in the emergency room). Stated differently, providers will not be held to the standard of care applicable in a normal emergency room setting, but instead a unique disaster medicine standard that will grant far more latitude to physicians.  That standard, however, is not yet clear.  Physicians may reasonably disagree on what constitutes the best patient care in wartime or mass casualty triage situations.  The issue is extremely complex and there is no obvious “right” approach at this time. The unique features of COVID-19 itself may also impact potential medical malpractice claims.  There is no current cure for COVID-19, so while physicians can treat the symptoms, they cannot yet address the underlying cause.  As a result, it will be difficult for any potential plaintiff to establish definitively that admission to a hospital or access to a ventilator would have prevented the patient’s death.  Absent evidence that the patient’s death was primarily caused by a provider’s decision, rather than COVID-19 and/or other contributing factors, medical malpractice claims will fail. That said, extenuating circumstances do not always deter medical malpractice plaintiffs.  See, e.g., LaCoste v. Pendleton Methodist Hosp., LLC, 966 So. 2d 519 (La. 2007) (plaintiffs pursued medical malpractice claims against a New Orleans hospital for wrongful death arising from facility deficiencies related to Hurricane Katrina); Husband v. Tenet HealthSystems Mem. Med. Ctr., Inc., 16 So. 3d 1220 (La. Ct. App. 2009) (wrongful death class action against hospital and providers involved in care during Hurricane Katrina). Therefore, in order to protect physicians who may end up in uncharted waters, and to ensure the best patient care possible in difficult circumstances, healthcare providers may want to prepare for the possibility of wartime triage.  Some potential steps include: Establishing clear policies and guidelines that govern the implementation and application of disaster triage practices. These guidelines could be adaptations of mass casualty incident plans that are more specifically tailored to COVID-19.  The goal is to provide guidance appropriate to the facility and the circumstances so that providers do not need to make ad hoc decisions on their own.  Once established, hospitals may also need to reassess the guidelines as the situation develops. Ensuring that all providers are familiar with evolving guidelines and fully understand the decision-making criteria. Extensive training and simulations may not be feasible, but basic knowledge of the guidelines will help keep care consistent. Emphasizing the need for proper documentation of all care decisions. While maintaining medical records will not seem like a priority in the chaos and tumult of an overflowing emergency department, good documentation will be critical to providing quality care and important for the defense of any future medical malpractice claim. Remaining attuned to the publication of national guidelines and the adoption of local laws that may provide limited liability protections during crises. Existing triage guidelines may help hospitals establish their own framework for handling disaster triage decisions. At this moment, healthcare providers should be focused on patient care and their own health and well-being, not potential legal liability.  But specific planning for the potential need for disaster medicine triage can provide comfort, consistency and protection for patients and providers on the front line.

In light of the COVID-19 pandemic, the Food and Drug Administration (“FDA”) issued recent non-binding guidance (“Guidance”) on the conduct of ongoing clinical trials of medical products. The FDA acknowledges that the public health emergency may result in unavoidable protocol modifications and/or deviations. Quarantines, site closures, travel limitations, interruptions in the supply chain for the investigational product, and infection of site personnel and trial subjects can all disrupt  protocol-specified procedures, such as mandatory visits, administration of the investigational product, or laboratory testing.  The Guidance provides FDA’s thinking on how sponsors, clinical investigators, and Institutional Review Boards/Independent Ethics Committees (“IRBs”) should, notwithstanding the current challenges, approach trial participant safety, compliance with good clinical practices (GCP) and risks to trial integrity. Highlights from the Guidelines include: Trial Participant Safety It is clear that for each changed circumstance necessitated by the COVID-19 emergency, trial sponsors (together with investigators and IRBs) should first consider the impact on participant safety.  Decisions regarding continued participant recruitment, continued use of an investigational product, changing patient monitoring practices, discontinuing the trial, or other modifications should be considered with trial participant safety as the paramount factor. FDA considers it critical that trial participants be informed of all changes that could impact them. Participants may not be able to travel to investigational sites for protocol-mandated visits.  Sponsors should evaluate whether alternative methods for safety assessments, such as delayed patient visits, phone calls, or virtual visits, are sufficient to assure trial participant safety. If any trial participants are unable to access the investigational product or the investigational site, they may need additional safety monitoring. Sponsors may also consider whether there are alternative means to administer the investigational product when scheduled site visits are impracticable.  However, FDA states that regulatory requirements regarding investigational product accountability remain in effect and should be addressed and documented. COVID-19 Screening; Changes to Study Protocol The FDA states that COVID-19 screening procedures mandated by the investigational site do not need to be reported as an amendment to the protocol (even if performed during clinical study visits), unless the sponsor is incorporating the data collected as part of a new research objective. In addition, although sponsors are encouraged to engage with IRBs as soon as possible about urgent or emergent protocol changes, such changes to study protocols or informed consent as a result of COVID-19 that are intended to minimize or eliminate immediate hazards or to protect the life and well-being of trial participants may be implemented without IRB approval or amendment, or before filing an IND or IDE with FDA, but must be reported after such implementation. Documenting and Analyzing Study Changes and Impact In addition to trial participant safety, the other key takeaway from the Guidance is that FDA expects sponsors to document and explain all efforts to minimize the impact of any protocol modifications or deviations on the safety of trial participants and study data integrity.  This documentation should include: (1) what contingency measures were implemented to manage study conduct (including their duration and how they were necessitated by COVID-19); (2) a listing of all affected participants by unique study identifier, and a description of how the individual’s participation was affected; and (3) analysis and discussions addressing the impact of such contingency measures on the safety and efficacy results reported for the study. Importantly, if there are missed visits, changes in visit schedules, or other facts that result in missing information, then each affected case report form should include specific information that explains the missing data and its relationship to COVID-19.  This information should also be summarized in the clinical study report. If changes in the study protocol lead to changes to efficacy assessment methods, amendments in data management or statistical analysis plans, the FDA requests that the sponsor consult with the applicable FDA review division. The FDA states that sponsors, investigators, and IRBs should all consider adopting policies and procedures (or revisions to existing policies) to address potential disruption as a result of COVID-19. The FDA provided examples of potential changes: impact on the informed consent process, study visits and procedures, data collection, study monitoring, adverse event reporting, changes to investigations, site staff, and monitoring resulting from regional or nationally imposed travel restrictions or quarantine measures or illness. Depending on the nature of revisions to the policies and procedures, applicable regulations may require a protocol amendment. Undoubtedly, the current public health emergency will impact ongoing clinical trials.  The extent and nature of that impact will vary depending on the trial, the investigational product, the disease being studied in the trial, the ability to conduct safety monitoring, and other factors.  The FDA recognizes these facts, and the Guidance stresses two fundamental points.  First, all trial activity, and each modification or deviation to a trial protocol, should be assessed with trial participant safety as the principal consideration.  Second, all changes necessitated by COVID-19 should be carefully documented and analyzed in the clinical trial report to explain their connection to COVID-19 and their impact on participant safety and trial data integrity. A copy of the full guidance issued by the FDA can be found at: https://www.fda.gov/regulatory-information/search-fda-guidance-documents/fda-guidance-conduct-clinical-trials-medical-products-during-covid-19-pandemic If you have further questions, please contact the authors or any member of Dorsey & Whitney’s health care transactions and regulations practice group.

On March 9, 2020, the Centers for Medicare and Medicaid Services (“CMS”) Quality, Safety and Oversight Group (“QSO”) issued a memorandum, QSO-20-15, providing guidance to health care providers related to the Emergency Medical Treatment and Labor Act (“EMTALA”) implications regarding the COVID-19 pandemic. EMTALA is a Federal law that requires all Medicare-participating hospitals (including critical access hospitals (“CAHs”)) with dedicated emergency departments (“EDs”) to perform an appropriate medical screening exam (“MSE”) for all individuals who come to their EDs to determine if the individual has an emergency medical condition (“EMC”), regardless of their ability to pay.  If there is no EMC, the hospital’s EMTALA obligations end.  If there is an EMC, the hospital must treat and stabilize the EMC within its capability or transfer the individual to a hospital that has the capability and capacity to stabilize the EMC. Hospitals with specialized capabilities may not refuse an appropriate transfer under EMTALA if they have the capacity to treat the transferred individual. In the wake of the COVID-19 pandemic, many hospital EDs are under increased strain due to an influx of patients with suspected or confirmed cases of COVID-19.  Hospitals are concerned not only about their ability to handle this unprecedented increase in ED patients but also about their ability to minimize the risk of exposure of COVID-19 to other ED patients as well as healthcare workers.  CMS released their guidance to address these concerns and to remind hospitals of their EMTALA obligations during the COVID-19 pandemic. On March 13, 2020, the Secretary of the U.S. Department of Health And Human Services (“HHS”) waived certain EMTALA requirements following President Trump’s declaration that the COVID-19 pandemic constitutes a national emergency. The HHS waiver specially waives sanctions for the “direction or relocation of an individual to another location to receive medical screening pursuant to an appropriate state emergency preparedness plan or for the transfer of an individual who has not been stabilized if the transfer is necessitated by the circumstances of the declared Federal public health emergency for the COVID-19 pandemic.” Below is a FAQ of the guidance for Medicare-participating hospitals (including CAHs) issued by CMS as well as a summary of the EMTALA waivers issued by HHS. What do the screening, stabilization, and transfer requirements for hospitals under EMTALA look like in light of the implications of COVID-19? Generally speaking, Medicare-participating hospitals must, at a minimum, (1) provide a MSE to every individual who comes to the ED for examination or treatment for a medical condition to determine if they have an EMC (an EMC is present when there are acute symptoms of sufficient severity such that the absence of immediate medical attention could reasonably be expected to result in serious impairment or dysfunction); (2) provide necessary stabilizing treatment for individuals with an EMC within the hospital’s capability and capacity; and (3) provide for transfers of individuals with EMCs, when appropriate. Every hospital with a dedicated ED is required to conduct an appropriate MSE for all individuals who come to the ED, including individuals who are suspected of having COVID-19, regardless of whether they arrive by ambulance or are walk-ins, unless an EMTALA waiver applies (see FAQ #7 below). Every ED is expected to have the capability to apply appropriate COVID-19 screening criteria when applicable, to immediately identify and isolate individuals who meet the screening criteria to be a potential COVID-19 patient, and to contact their state or local public health officials to determine next steps. Is my hospital required to accept transfers of patients with suspected or confirmed cases of COVID-19 from small or rural hospitals that do not have appropriate or sufficient isolation facilities or equipment? Yes.  If your hospital has the capacity and the specialized capabilities needed for stabilizing treatment, then you are required to accept appropriate transfers from hospitals without such capacity and capabilities.  Hospitals should continue to coordinate with state and local public health officials regarding placement of individuals who meet COVID-19 assessment criteria and the most current standards of practice for treating COVID-19 as this situation continues to develop. The situation continues to change on a near-hourly basis. How will CMS determine whether an EMTALA violation has occurred? CMS has stated they will evaluate the capabilities and capacity of both the referring and recipient hospitals to determine whether a violation has occurred.  Because of the dynamic situation, this evaluation would include the recommendations of the Centers for Disease Control and Prevention (“CDC”) at the time the suspected violation occurred.  At the time of this writing, the CDC’s recommendations focus on factors such as the individual’s recent travel, exposure history, and presenting signs and symptoms in differentiating the types of capabilities hospitals should have to screen and treat individuals who have or may have COVID-19.  See the CDC website for the most current infection prevention and control recommendations for hospital patients with suspected or known cases of COVID-19 (https://www.cdc.gov/coronavirus/2019-ncov/hcp/clinical-guidance-management-patients.html). All hospitals are required to accept appropriate transfers of individuals with EMCs if the hospital has the specialized capabilities an individual requires for stabilization and the capacity to treat these individuals. This obligation applies regardless of whether the hospital has a dedicated ED. What are the requirements for alternative screening sites our hospital sets up on campus? Hospitals may set up alternative screening sites on campus.  CMS highlights that the MSE does not have to take place in the ED. A hospital may set up alternative sites on its campus to perform MSEs.  Individuals may be redirected to these sites after being logged in. The redirection and logging in can even take place outside the entrance to the ED.  The person doing the directing should be qualified (e.g., an RN) to recognize individuals who are in need of immediate treatment in the ED.  The content of the MSE varies according to the individual’s presenting signs and symptoms. It can be as simple or as complex, as needed, to determine if an EMC exists.  MSEs must be conducted by qualified personnel, which may include physicians, nurse practitioners, physician’s assistants, or RNs trained to perform MSEs and acting within the scope of their State Practice Act. Finally, the hospital must provide stabilizing treatment (or appropriate transfer) to individuals found to have an EMC, including moving them as needed from the alternative site to another on-campus department. What are the requirements for alternative screening sites our hospital sets up off campus? Hospitals may set up screening at off-campus, hospital-controlled sites.  CMS guidance states that hospitals and community officials may encourage the public to go to these sites instead of the hospital for screening for influenza-like illness (“ILI”).  However, a hospital may not tell individuals who have already come to its ED to go to the off-site location for the MSE unless it is done pursuant to a state emergency preparedness plan. Unless the off-campus site is already a dedicated ED (“DED”) of the hospital, as defined under EMTALA regulations, EMTALA requirements do not apply. The hospital should not hold the site out to the public as a place that provides care for EMCs in general on an urgent, unscheduled basis. They can, however, hold it out as an ILI screening center.  The off-campus site should be staffed with medical personnel appropriately trained to evaluate individuals with ILIs. If an individual needs additional medical attention on an emergent basis, the hospital is required, under the Medicare Conditions of Participation, to arrange referral/transfer. Prior coordination with local emergency medical services is advised to develop transport arrangements. What if a screening suggests possible COVID-19? If an individual “comes to the emergency department” (as defined at 42 C.F.R. § 489.24(b)), the hospital must provide that individual with an appropriate MSE.  It is a violation of EMTALA for hospitals with EDs to use signage that presents barriers to individuals suspected of having COVID-19 from coming to the ED.  However, use of signage to direct individuals to alternative screening locations on campus would be acceptable. If, consistent with applicable standards for COVID-19 screening, a hospital determines an individual who has come to the ED may have COVID-19, the hospital is expected to isolate the patient immediately and coordinate with their state or local public health officials.  CMS expects all hospitals to, within their capability, provide MSEs and initiate stabilizing treatment while maintaining isolation in accordance with COVID-19 standards of practice. How do the EMTALA waivers relating to the COVID-19 outbreak change my hospital’s obligations under EMTALA? On March 13, 2020, the Secretary of HHS waived certain EMTALA requirements following the President’s declaration that the COVID-19 pandemic constitutes a national emergency. The HHS waiver specially waives sanctions for the “direction or relocation of an individual to another location to receive medical screening pursuant to an appropriate state emergency preparedness plan or for the transfer of an individual who has not been stabilized if the transfer is necessitated by the circumstances of the declared Federal public health emergency for the COVID-19 pandemic.” The new EMTALA waiver permits a hospital to (1) redirect an individual to another location — including another hospital — to receive an MSE without first performing an MSE at the hospital if it is done pursuant to a state emergency preparedness plan, or (2) transfer an individual who has not yet been stabilized to another location if such actions are necessary and the result of circumstances due to the COVID-19 pandemic. HHS makes clear that the EMTALA waivers do not apply to any actions taken by a hospital that discriminate against individuals on the basis of their source of payment or ability to pay. The EMTALA waiver under Section 1135 does not appear to be a blanket waiver, so providers wishing to use the waiver may require “case-by-case” requests and approvals from your CMS Regional Office. “ The waiver is retroactively effective back to March 1, 2020 and will remain in effect for the duration of the national emergency period, unless terminated sooner.

On March 22, 2020, the Centers for Medicare & Medicaid Services (CMS) announced in a press release that it is granting exceptions from reporting requirements and extensions for upcoming data submission and measure reporting deadlines for Medicare quality reporting programs.  The exceptions and extensions are intended to reduce data collection and reporting burdens for entities that are responding to COVID-19 so that they can continue to focus on caring for patients.  CMS states that this is “unprecedented relief for the clinicians, providers, and facilities participating in Medicare quality reporting programs including the 1.2 million clinicians in the Quality Payment Program and on the front lines of America’s fight against the 2019 Novel Coronavirus (COVID-19).” The CMS programs impacted by this “extreme and uncontrollable circumstances” policy exceptions and extensions include, among others, the Quality Payment Program–Merit-based Incentive Payment System (MIPS), Medicare Shared Savings Program Accountable Care Organizations (ACOs), and various hospital quality reporting programs (e.g., Hospital-Acquired Condition Reduction Program).  CMS provided a table in the press release indicating how both 2019 and 2020 data submissions are impacted. For programs that have data submission deadlines in April and May 2020, this submission will be optional.  In addition, no data reflecting services provided from January 1 through June 30, 2020 will be used in CMS’s calculations for value-based purchasing programs and Medicare quality reporting.  CMS stated as follows: “CMS recognizes that quality measure data collection and reporting for services furnished during this time period may not be reflective of their true level of performance on measures such as cost, readmissions and patient experience during this time of emergency and seeks to hold organizations harmless for not submitting data during this period.” For other Dorsey publications on Medicare’s Quality Payment Program, see here and here.

On February 26, 2020, the Supreme Court held that the term “actual knowledge” in the ERISA statute of limitations clause found in 29 U.S.C. §1113(2), ERISA §413 applicable to breach of fiduciary duty cases means “what it says”:  “to have ‘actual knowledge’ of a piece of information, one must in fact be aware of it.” The ruling came out of the case Intel Corp. Investment Policy Committee v. Sulyma, No. 18–1116, filed in 2015 by an ERISA plan participant on behalf of a putative class alleging that the Intel Corp. Investment Policy Committee (“Intel”) breached its fiduciary duties when it increased investments in “alternative” investments (e.g. hedge funds, private equity, and commodities) that generated sub-par returns in the post-recession market.  Sulyma received disclosures from Intel regarding the Committee’s investment decisions in 2011 and 2012, but he testified that he did not remember viewing them. After Sulyma filed suit in 2015, Intel moved for summary judgment, arguing that because he received the disclosures more than three years earlier, his claim was time barred under the three-year statute of limitations set forth in §1113(2).  Rejecting Sulyma’s argument that his claim was instead subject to ERISA’s six-year statute of repose, the district court agreed with Intel and granted its motion for summary judgment.  The Ninth Circuit reversed on the basis that “actual knowledge” required more than proof of sufficient disclosure, further widening a circuit split created by a 2010 Sixth Circuit opinion holding that actual knowledge required only such disclosure.  See Brown v. Owens Corning Investment Review Comm., 622 F.3d 564, 571 (6th Cir. 2010). The Supreme Court affirmed the Ninth Circuit, thereby resolving the circuit split.  To arrive at this holding, the Supreme Court relied on dictionary definitions, past precedent, and Congress’s repeated “linguistic distinctions” in the ERISA statutory scheme regarding what a plaintiff should know or actually knows.  Specifically, the Court placed great stock in the fact that in some parts of the ERISA statutory scheme, Congress created statutes of limitation based on “the earliest date on which the plaintiff acquired or should have acquired actual knowledge of the existence of such cause of action,” while in others it specified only actual knowledge.  Compare 29 U.S.C. §1303(e)(6), (f)(5) (emphasis added) with §1113(2).  Because section 1113(2) provides only for “actual knowledge” without explicitly identifying any other forms of knowledge, the Court ruled that constructive knowledge was not enough to trigger the statute. Although Sulyma involved a retirement plan, it has implications for employer-sponsored health plans that are also governed by ERISA.  While the Court’s ruling makes it harder for defendants to win summary judgment on ERISA’s three-year “actual knowledge” statute of limitation, the Court did not entirely foreclose such relief. The Court stated defendants can still prove actual knowledge through inferences from circumstantial evidence, such as evidence of disclosure, electronic records showing receipt and reviews of those disclosures, and actions taken in response to the information contained within them.  But such evidence may be disputed as a factual matter, making judgment on an early dispositive motion more difficult.  Nevertheless, some plan sponsors may wish to consider implementing additional procedures associated with the distribution of plan documents and the disclosure of plan information to create a stronger evidentiary record of when participants become aware of a particular development. In addition, the Court opened a potential window for defeating motions for class certification.  Under the Federal Rules of Civil Procedure, a class may be certified only when plaintiffs present “common issues” of law and fact, and when their claims are “typical” of those of others in the class.  Fed. R. Civ. P. 23.  Whether a participant had “actual knowledge” of a particular communication or disclosure that might trigger the statute is inherently individual in nature, arguably precluding certification of a class.  Thus, although Sulyma may provide ERISA plan participants with additional ammunition for defeating statute of limitation defenses in fiduciary misconduct cases, such claims may be more difficult to certify. Finally, although the Sulyma Court did not address the subject, employers should be mindful of potential opportunities to manage ERISA risk by incorporating shorter limitation periods in plan documents.  In Heimeshoff v. Hartford Life & Acc. Ins. Co., 571 U.S. 99 (2013), the Supreme Court ruled that plans could impose shorter statutes of limitations on ERISA claims for benefits.  Sponsors who choose to include such plan terms should be careful to ensure that these limits are consistent with updated case law and are properly communicated to participants and claimants.  Although there is little case law providing that this same rule will apply to breach of fiduciary duty claims, compare Hewitt v. W. & S. Fin. Group Flexible Benefits Plan, 17-5862, 2018 WL 3064564, at *2 (6th Cir. Apr. 18, 2018) (enforcing plan provision for shorter statute of limitations to fiduciary claim) with Chelf v. Prudential Ins. Co. of Am., 3:17-CV-00736-GNS, 2018 WL 4219424, at *7 (W.D. Ky. Sept. 5, 2018) (declining to enforce plan provision for shorter statute of limitations to fiduciary claim), courts may provide greater clarity in future litigation.

The COVID-19 pandemic has dramatically increased the number of patients and providers seeking to implement and use telehealth visits and other digital health solutions – and rapidly, at that.  The challenge of implementing digital health solutions, particularly telehealth, has historically been the patchwork setup of both federal and various state regulations that made it difficult for providers and telehealth vendors to offer solutions at a large scale, particularly across state lines.  In the current state of public emergency, both the federal government and various state governments are recognizing the need to ease prior restrictions and expand telehealth availability in order to help patients receive care at home; this helps limit the spread of COVID-19 by further enabling social distancing and freeing up providers’ brick-and-mortar hospitals and clinics to treat COVID-19 patients.  The need is clear, as is the desire by all parties to jump in and offer telehealth visits.  The new challenge has become understanding how state requirements fit in daily updates to federal law.  In this blog post, we will look first to the current legal environment with respect to the federal waiver and state regulations, and then provide recommendations (in numbered list below) as to what this means for your plans to offer telehealth visits. Specifically, clinical licensure has traditionally been amongst the most challenging regulations to contend with in offering telehealth visits.  Federal reimbursement and state clinician licensure rules generally restrict clinicians from offering telehealth services to a patient physically located in a state without the appropriate medical license in that state.  Now, however, through CMS 1135 waivers and state-specific executive orders, which we have described more below, clinicians are able to leverage relaxed cross-state reimbursement and licensure rules to offer telehealth services more easily and immediately during this time of public health emergency. Historically, the general rule, with few exceptions, is that a clinician must be licensed to practice in the state in which the patient receiving telehealth services is located. These rules are derived from state professional licensing laws, as well as from payor requirements, including the conditions of payment under the Medicare and Medicaid programs. Therefore, a physician licensed to practice in Minnesota, for example, could not typically provide telehealth services to a patient located in Iowa during the time of the visit without first obtaining an Iowa license to practice medicine. Failure to do so could subject the physician’s medical license to discipline, and could also render the services not billable to various private and governmental payors. Currently, the in-state licensure requirements of payors and professional licensing bodies are beginning to change within the confines of the COVID-19 public health emergency. With respect to Medicare and Medicaid billing requirements, under the emergency proclamation by the President, CMS has the authority to issue “1135 waivers” that will temporarily waive or modify certain Medicare and Medicaid requirements to ensure that sufficient health care items and services are available to meet the needs of individuals enrolled in Federal health care programs. Shortly following the Proclamation on Declaring a National Emergency Concerning the Novel Coronavirus Disease (COVID-19) Outbreak, both HHS and CMS issued statements announcing a number of COVID-19 1135 waivers now either applicable automatically nationwide or available through request by individual providers and the states, depending on the type of waiver. These waivers encompass an array of options and relaxing of rules that apply to services provided to Medicare and Medicaid patients.  One of the waivers provides that CMS will “temporarily waive [reimbursement] requirements that out-of-state providers be licensed in the state where they are providing services when they are licensed in another state” (the “Clinician Licensing Waiver”).  (Other waivers ease restrictions surrounding provider Medicare and Medicaid enrollment, skilled nursing and other long-term care facility requirements, and bed allocation requirements).  This is an enormous and important shift, and one that digital health advocates have been championing for a long time, as it enables clinicians to “see” patients in other states without a protracted cross-state licensure process. The challenge, however, is understanding how the federal waivers and existing state requirements interact. These 1135 waivers apply only to federal requirements, and any providers looking to practice in accordance with these waivers must be careful to also comply with applicable state laws. Largely, the COVID-19 1135 waivers fall in two categories: (1) blanket waivers; and (2) case-by-case waivers. The blanket waivers include those waivers listed by CMS in their statement and are applicable automatically nationwide with respect to Medicare rules (not Medicaid or other CMS programs, except by request, as noted below). The Clinician Licensing Waiver is one such waiver. This waiver applies automatically to Medicare reimbursement, but clinicians must also ensure they are practicing in accordance with a particular state’s licensing rules before issuing professional services in that state. States that would like these Medicare blanket waivers, including the Clinician Licensing Waiver, to apply to their state’s Medicaid program must send a request to CMS for case-by-case approval. Currently, only Florida and Washington have received approval for their requested COVID-19 1135 waivers, including the Clinician Licensing Waiver along with other provider enrollment and prior authorization requirement waivers. However, CMS states that it will continue to expeditiously review and approve 1135 waivers during the COVID-19 public health emergency. This CMS website will provide up-to-date information on all states that receive any COVID-19 1135 waivers. While the Clinician Licensing Waiver is limited in applicability to Medicare and Medicaid reimbursement, states are beginning to follow suit by temporarily waiving their state level professional licensure requirements for telehealth providers. Still, providers should take caution to not provide services without a state license unless and until it is confirmed that the state will allow this practice. One state that we have identified as permitting telehealth practice without a state license during the COVID-19 public health emergency is Iowa. Iowa’s emergency proclamation contains a section that temporarily suspends various telehealth practice standards, including the requirement that Iowa telehealth providers be licensed in Iowa. Note, however, that commercial payor rules may be unaffected by both the federal waivers and the easing of state professional licensing rules. From an operational standpoint, the Clinician Licensing Waiver ostensibly eases offering telehealth visits across state lines, but the state-specific regulations still require ongoing vigilance.  For those providers and other types of vendors seeking to offer telehealth, we would encourage the following:   Identify exactly which populations you must be able to treat in order for the telehealth visits to be feasible and viable (financially and operationally) for your organization While organizations would like to be able to immediately offer telehealth visits for everyone, the reality at this time, while states sort out whether they will ease state licensure restrictions, is that you may only be able to conduct telehealth visits and receive reimbursement in states in which your clinician is allowed to practice without a license and for certain populations only.  It will vary tremendously by state, and the answer may change on a near-daily basis, as states make their decisions.   Speak with your attorney about the states in which you want to offer visits (or where your patient populations may currently be) to understand the current status for those states Per above, the situation is changing rapidly, and we strongly recommend asking your attorney to check the state’s status vis-à-vis the federal waivers.  We would advise adding that into your tracking document (see next item).   Draft your quick state-by-state plan and what your readiness checks will be to start with a new state (and do not worry – this can be rough-and-ready) We often help our clients with state rollout plans and readiness checklists, and they are still important now; however, given the dramatic need for speed, do not let the perfect be the enemy of the good.  Based on your answers to the above two items, you should confirm with your team both the plan for which states you will be able to offer visits in and also the criteria for when and how you will assess and identify the next states in which you can offer telehealth services.  You can perfect and polish these plans at a later point, but having a plan of action for all involved will prevent confusion or, worse, lack of compliance if you do not pay careful attention to states’ evolving rules.  We would recommend that your state readiness checklist include an attorney approval step; this is particularly important now, since the states’ rules are changing so rapidly.  The good news is that, for the most part, the changes are leaning toward the more permissive rather than restrictive, so you may find new states in which you are able to operate.   Identify exactly which active state licenses your clinicians hold and document, ideally in a spreadsheet or other easy tracking mechanism We recommend (and create for our clients) tracking tools with respect to clinical licensure during regular times, and it is equally important now.  While the goal is to be able to offer telehealth visits to patients in states in which your clinicians are not currently licensed, you will need to keep track of who is actually licensed where, so that if and when regulations should revert, or if and when there should be changes to the scope of licensure or reimbursement, you are able to quickly assess your own staff’s licensure status and pivot as needed.  These tracking tools need not be fancy, though it is helpful to tie them to calendar reminders or other ticklers to enable consistent monitoring.   Keep in mind – and regularly monitor – other relevant requirements as you contemplate the nature and process of the telehealth visits. For example, you will still want to abide by current HIPAA requirements (which are also changing during this public emergency – please see our article here), documentation requirements, and reimbursement-related considerations. Your standard operating procedure and telehealth visit process will likely need to be altered to include verbal caveats or discussion points between your providers and the patients.  We would advise reviewing and then either drafting or updating your current visit script, as well as the documentation presented on your website portal for the telehealth visit.   Your plan for downtime procedures is going to become all the more important – assess if you’re ready and that your providers are aware of what to do. With so many people using internet and particularly video chat services, our IT infrastructure and that of the telehealth platform vendors themselves is experiencing a surge in usage, which will test capacity levels.  This would be the case in “regular” life, but becomes more important now, as you reach out to and conduct telehealth visits with new patients: does your script and posted information include information as to how the patient can reach you if the telehealth visit is interrupted?  What should be their plan with respect to reaching out to local (in-state) providers versus your organization, both for downtime and post-visit? This issue is rapidly changing and being updated at both the Federal and state level on a day-to-day basis. For additional information on various COVID-19 responses, guidance and resources, please see our articles on Medicare payment for telehealth services; HIPAA provisions now allowing the use of personal devices and everyday communication technology to deliver telehealth; DEA prescribing laws now allowing controlled substances to be prescribed via telehealth without an in person exam; and numerous other helpful legal analyses and guidance on COVID-19 related matters. If you would like specific information on how your state is currently treating these issues, please reach out to the authors or your usual Dorsey attorney or Dorsey Health Strategies business consultant.

On March 17, 2020, the Centers for Medicare and Medicaid Services (“CMS”) and the Department of Health and Human Services Office of the Inspector General (“OIG”) each issued policy statements which expand access to telehealth services for Medicare beneficiaries and permit physicians and other practitioners to reduce or waive beneficiary cost-sharing obligations for Medicare telehealth services during the COVID-19 public health emergency. Immediately following the enactment of the Coronavirus Preparedness and Response Supplemental Appropriations Act, available here, CMS issued a temporary expansion of the Medicare telehealth benefit beginning as of March 6, 2020 and effective until the public health emergency declared by the Secretary of the Department of Health and Human Services ends.  The CMS policy statement can be found here. A key element of this telehealth expansion is that payment will be made for office visits and other covered Medicare telehealth services furnished to beneficiaries located in any part of the U.S.  Moreover, the CMS waiver facilitates payment for telehealth services furnished while the beneficiary is located in their home or in any care setting.   Without this emergency expansion, current Medicare rules at Social Security Act § 1834(m) generally limit coverage for telehealth services to beneficiaries located in rural areas, and only when the beneficiary is within a hospital, clinic, or other medical facility at the time of the telehealth visit. Clinicians who may offer telehealth services to Medicare beneficiaries include physicians, nurse practitioners, physician assistants, clinical social workers, clinical psychologists, and registered dieticians.  CMS also states that to the extent Medicare reimbursement for a telehealth service requires a prior relationship between the clinician and beneficiary, CMS will use its enforcement discretion and not audit claims submitted during the public health emergency to determine if such a prior relationship existed. The CMS waiver explicitly permits clinicians to use telephones with audio and video capabilities to furnish Medicare telehealth services during the COVID-19 public health emergency.  Together with the new waiver of certain HIPAA privacy rules (addressed in our prior blog post found here), this now will permit clinicians to conduct visits with Medicare beneficiaries using common communications tools such as personal phones, devices and computers, and common technologies such as FaceTime or Skype. CMS issued a FAQ document on this temporary and emergency telehealth benefit expansion, which can be found here. In tandem with CMS’ expansion of the Medicare telehealth benefit, the OIG issued a policy statement to address the potential anti-kickback and beneficiary inducement issues that providers may face during this emergency.  OIG states that it will not sanction physicians or other practitioners for reducing or waiving cost-sharing obligations that a beneficiary may owe for telehealth services furnished during the COVID-19 public health emergency and furnished in accordance with the then-applicable Medicare rules (which would include the CMS telehealth benefit expansion during the emergency).  Normally, the routine reduction or waiver of Medicare beneficiary cost-sharing obligations would implicate the federal anti-kickback statute and the civil monetary penalty law prohibiting beneficiary inducement. Clinicians are not obligated to reduce or waive Medicare beneficiary coinsurance and deductible obligations, but may do so in accordance with the OIG policy statement without risk of anti-kickback or beneficiary inducement enforcement.  Moreover, the OIG states that it will not view providing future services that may occur as a result of any free telehealth services to, by itself, be evidence of beneficiary inducement. The OIG Policy Statement can be found here. These CMS and OIG issuances are intended to give providers added flexibility to combat the COVID-19 emergency.  Hospitals and other providers should consider how the temporary Medicare telehealth expansion and the flexibility in dealing with beneficiary cost-sharing can help them keep clinicians and beneficiaries safer, alleviate some of the burden on provider staff and space, and help reduce the spread of COVID-19. If you have any questions, please contact the author or any member of Dorsey’s healthcare transactions and regulations practice group.

In light of the novel coronavirus pandemic, health care practitioners should be aware of relaxed guidelines for prescribing controlled substance. This blog post describes when practitioners can prescribe controlled substances via telemedicine and exceptions available to opioid treatment programs. Telemedicine Prescribing Typically, an in-person medical evaluation must be conducted before a prescription for a controlled substance is issued through telemedicine or other internet means. However, when the Secretary of Health and Human Services has declared a public health emergency, as he recently did, prescribers may utilize an exception to the in-person evaluation requirement. For as long as the Secretary’s designation of a public health emergency remains in effect, DEA-registered practitioners may issue prescriptions for controlled substances to patients for whom they have not conducted an in-person medical evaluation, provided all of the following conditions are met: The prescription is issued for a legitimate medical purpose by a practitioner acting in the usual course of their professional practice; The telemedicine communication is conducted using an audio-visual, real-time, two-way interactive communication system; and The practitioner is acting in accordance with applicable Federal and State law. As long as the practitioner satisfies all of these requirements, the prescription may be issued using any method of prescribing currently set forth in DEA regulations. Thus, the practitioner may issue a prescription either electronically (for schedules II-V), by calling in an emergency schedule II prescription to a pharmacy, or by calling in a schedule III-V prescription to the pharmacy. Note that regardless of whether there is a public health emergency, a prescribing practitioner that has previously conducted an in-person medical evaluation of a patient may issue a prescription for a controlled substance after communicating with the patient via telemedicine. The prescription must still be issued for a legitimate medical purpose and comply with applicable Federal and State law. More information about the DEA-response to the coronavirus may be found here. Medications for Patients with Opioid Use Disorders Additionally, the Substance Abuse and Mental Health Services Administration (“SAMHSA”) has also issued guidance regarding medications for patients with opioid use disorders in treatment programs. If a state has declared a state of emergency, the state may request blanket exceptions for all stable patients in an Opioid Treatment Program (OTP) to receive 28 days of take-home doses of the patient’s medication for opioid use disorder. The state may request up to 14 days of take-home medication for those patients who are less stable, but who the OTP believes can safely handle this level of take-home medication. In states that have not declared states of emergency, an OTP can provide a blanket exemption request for its clinic per the guidance above (i.e., up to 28 days for stable patients and up to 15 days for less stable patients). These requests do not have to be submitted on a per-patient basis. Programs and states should use appropriate clinical judgment and existing procedures to identify stable patients. SAMHSA notes that as an increased medication supply will likely accompany these requests, OTPs and states must ensure that there is enough medication ordered and on hand to meet patient needs. We are continuing to monitor the federal response to the coronavirus pandemic and will continue to post updates. If you have any further questions, please contact the authors of this post or your regular Dorsey attorney.

This post provides an update on a number of HIPAA waivers that have just been made available to health care providers: (1) Waivers for hospitals in the initial 72 hours of enacting a disaster protocol; and (2) Waivers for all health care providers to allow them to use “everyday communications technologies, such as FaceTime or Skype, during the COVID-19 nationwide public health emergency” for the provision of patient care services.  Each waiver is addressed more fully, below: Waivers for Hospitals in the Initial 72 Hours of Enacting a Disaster Protocol First, the Secretary of the Department of Health and Human Services (HHS) has issued limited HIPAA waivers to hospitals.  The waivers are retroactive to March 15, 2020.  See the HHS HIPAA waiver document here.  We addressed the possibility of these waivers in our earlier post, available here, along with a summary of some of the main HIPAA laws already in place which may be helpful to covered entities and business associates during this time of national and public health emergency. The HIPAA waiver document starts by reminding covered entities and their business associates that, in general, the HIPAA rules are not suspended during this time of a national and public health emergency.  In particular, addressing a topic of much discussion among providers, the guidance includes a reminder that the HIPAA security safeguards rules (mandating reasonable administrative, technical and physical safeguards) apply to uses and disclosures of electronic protected health information as always.  This statement is a reminder to health care providers of their obligations to use appropriate safeguards when using or disclosing protected health information (but, see Part 2 of this blog post, below, which describes a new waiver allowing providers to use everyday communications technologies for patient care.) The HIPAA waiver will only apply to hospitals: (1) in the emergency area identified in the public health emergency declaration (the declaration applies nationwide, see the declaration here); (2) that have instituted a disaster protocol; and (3) for up to 72 hours from the time the hospital implements its disaster protocol. After the 72 hours elapses, the hospital is required to return to full HIPAA compliance, even for patients who are still under care at the time.  Also, if the national emergency or the public health emergency is terminated, the hospital is required to return to full HIPAA compliance, even if the 72 hours has not elapsed. The waivers permit U.S. hospitals that have instituted their disaster protocol to have the following HIPAA requirements waived during the initial 72 hours of the disaster protocol: • the requirements to obtain a patient's agreement to speak with family members or friends involved in the patient's care. See 45 CFR 164.510(b). • the requirement to honor a request to opt out of the facility directory. See 45 CFR 164.510(a). • the requirement to distribute a notice of privacy practices. See 45 CFR 164.520. • the patient's right to request privacy restrictions. See 45 CFR 164.522(a). • the patient's right to request confidential communications. See 45 CFR 164.522(b). Waivers for All Health Care Providers to Allow the use of Everyday Communications Technologies for Patient Care Second, the HHS Office for Civil Rights (OCR) announced that it will “exercise enforcement discretion and waive penalties for HIPAA violations against health care providers that serve patients in good faith through everyday communications technologies, such as FaceTime or Skype, during the COVID-19 nationwide public health emergency”.  See the announcement from OCR here.  A few days later, OCR issued FAQs regarding telehealth and OCRs waiver of penalties for the use of everyday communications technologies, available here. This second announcement is particularly refreshing for health care providers who have been anxiously seeking easier methods, such as the use of personal devices and specific technologies, to interact via audio and/or video technologies with their patients and colleagues. Specifically, OCR states: “A covered health care provider that wants to use audio or video communication technology to provide telehealth to patients during the COVID-19 nationwide public health emergency can use any non-public facing remote communication product that is available to communicate with patients….This exercise of discretion applies to telehealth provided for any reason, regardless of whether the telehealth service is related to the diagnosis and treatment of health conditions related to COVID-19.” OCR provides the following examples of technology that will be allowed: “…a video chat application connecting the provider’s or patient’s phone or desktop computer in order to assess a greater number of patients while limiting the risk of infection of other persons who would be exposed from an in-person consultation.” “…popular applications that allow for video chats, including Apple FaceTime, Facebook Messenger video chat, Google Hangouts video, or Skype…” The OCR makes clear that this technology is also allowed to assess or treat any other medical condition, even if not related to COVID-19.   Further, the OCR also states in the notice that it will not impose penalties against health care providers that do not have a business associate agreement in place with such technology vendors. The OCR provides the following examples of technology that will not be allowed because they are public facing: Facebook Live Twitch TikTok similar video communication applications are public facing Finally, the OCR acknowledges that some health care providers may still wish to use technology vendors that are “HIPAA compliant” and with whom the health care provider has entered into a business associate agreement related to the vendor’s video communications products. The OCR provides a list of some technology vendors that represent that they provide HIPAA-compliant video communication products and will enter into a business associate agreement (although the OCR states that it does not endorse any particular technology and it has not reviewed the business associate agreements of these vendors): Skype for Business Updox VSee Zoom for Healthcare Doxy.me Google G Suite Hangouts Meet However, a few words of caution: The OCR encourages providers to notify their patients that these third-party applications potentially introduce privacy risks. Providers should also take as many security precautions as possible to protect patient information such as enabling “all available encryption and privacy modes when using such applications,” and having these conversations in private spaces to avoid others who are not involved in the patient’s care overhearing the communication. Further, even if a provider is using “everyday communications technologies”, providers should take care to record the interactions in the patient’s medical record to ensure that patients’ records are complete and accurate. We are continuing to monitor this ever evolving area of the law and will continue to post updates.  Please call the authors of this post or your regular Dorsey attorney if you have any questions.    

                Will HIPAA obligations be relaxed or waived in the wake of the coronavirus outbreak in the United States?  They could be.  This blog post contains information that is helpful to understand in preparation for such possibility. The Secretary of the Department of Health and Human Services (the “Secretary”) has the authority to declare a Public Health Emergency in situations such as a pandemic. A Public Health Emergency declaration allows the Secretary to take certain actions in response to the emergency, including waiving certain HIPAA Privacy Rule requirements. The Secretary recently made this declaration, and covered entities and their business associates should be aware of their HIPAA Privacy obligations and potential relief from these obligations. When would covered entities and their business associates know of a HIPAA Privacy Rule waiver? First, the President must declare an emergency or disaster pursuant to the National Emergencies Act or the Robert T. Stafford Disaster Relief and Emergency Assistance Act. The President made this declaration on March 13, 2020. Additionally, the Secretary must declare a Public Health Emergency (“PHE”) pursuant to the Public Health Service Act. You can read more about this declaration here. Finally, at least two days before waiving any HIPAA requirements, the Secretary must provide a certification and advance written notice to Congress about the Secretary’s intent to waive HIPAA requirements. 42 U.S.C. § 1220b-5. The DHS website would likely post this notice or the information contained within the notice, or otherwise make it publicly available. What will be the scope of a waiver? The Secretary’s notice to Congress must include a description of: the specific provisions that will be waived or modified; the health care providers to whom the waiver or modification will apply; the geographic area in which the waiver or modification will apply; and the period of time for which the waiver or modification will be in effect. 42 U.S.C. § 1220b-5. If a waiver is issued, Dorsey will provide more guidance about its scope and application. What HIPAA Privacy provisions could be waived? The Secretary may waive sanctions and penalties against covered entities that do not comply with certain provisions of the HIPAA Privacy Rule, including: The requirements to obtain a patient’s agreement to speak with family members or friends involved in the patient’s care; The requirement to honor a request to opt out of the facility directory; The requirement to distribute a notice of privacy practices; The patient’s right to request privacy restrictions; The patient’s right to request confidential communications The Secretary also has authority to modify (but not waive) deadlines and timetables for the performance of required activities, such as reporting requirements. 42 U.S.C. § 1220b-5(b)(5). Are there any existing HIPAA Privacy Rule exceptions that are relevant during a pandemic? Yes. The HIPAA Privacy Rule currently includes exceptions for when protected health information may be shared even if no PHE has been declared. Covered entities may disclose protected health information without individual authorization under certain circumstances: To a public health authority for the purpose of preventing or controlling disease; At the direction of a public health authority, to a foreign government agency; and To persons at risk of spreading a disease if other law, such as state law, authorizes the covered entity to do so. 45 C.F.R. §§ 164.501, 164.512(b)(1). Protected health information may also be shared under certain circumstances: To family friends, and others involved in an individual’s care and for notification; To prevent a serious and imminent threat to the health and safety of a person or to the public; and In limited circumstances, to others not involved in the care of the patient. 45 C.F.R. §§ 164.510, 164.512, 164.508.   Please see the February 2020 HIPAA Privacy and Novel Coronavirus bulletin from the DHHS Office for Civil Rights for more details on these current HIPAA provisions and when they apply. What do covered entities and their business associates need to do in preparation for a waiver? Covered entities and their business associates do not have advanced requirements in order to be eligible for a waiver. If a PHE is declared and the Secretary issues a waiver, that announcement will provide details about modifications to or waivers from specific HIPAA rules, as well as information about to whom the waivers or modifications apply.  Once those details are released, covered entities will need to evaluate the applicability of the waivers to their operations, and if they are applicable, how they will be implemented. Additionally, the DHHS Emergency Preparedness Decision-Tool may be helpful in determining what protected health information can be released for planning or response activities in emergency situations. The DHHS February 2020 bulletin also offers helpful guidance about the existing HIPAA Privacy Rule requirements and exceptions which may already be useful to help address uses and disclosures in the context of this public health outbreak. Until any waivers are issued, covered entities and business associates should continue to comply with all HIPAA Privacy Rule obligations. We will continue to closely monitor the federal response to the coronavirus pandemic. If you have further questions or need advice on how a Public Health Emergency affects your HIPAA Privacy obligations, please contact the authors or your regular Dorsey attorney.  

As the 2019 Novel Coronavirus (COVID-19) outbreak continues to unfold governments, economies, businesses, and countries are being adversely affected. Many companies are therefore also facing significant and urgent business and legal challenges so we have created a resource center to provide information that may be helpful in decision making. Click here to access articles, webinars and client alerts Dorsey has posted.  This website will be updated often to provide the latest resources for our clients.

The first publicly disclosed prosecution under the Eliminating Kickbacks in Recovery Act (“EKRA”) occurred last month, a little over a year after EKRA became law. As we described in a previous blog post, EKRA criminalizes certain health care payment arrangements related to referrals, regardless of payor. In the recent EKRA prosecution, an office manager of a Kentucky substance abuse treatment clinic pleaded guilty to soliciting kickbacks from a toxicology laboratory in exchange for urine drug testing referrals. Theresa Merced, the 80-year-old office manager, admitted that the CEO of the toxicology lab gave her a $4,000 check as part of a larger bundle of promised inducements. When law enforcement questioned Merced about the check, she denied knowledge of it and said it was likely a loan from the CEO to her husband. After the questioning, Merced asked the CEO to alter the laboratory’s financial records to reflect her story. Last month, Merced plead guilty to one count of violating EKRA, one count of making false statements, and one count of attempted tampering with records. She is scheduled to be sentenced on May 1, 2020, and faces up to twenty years in prison and a maximum fine of $250,000. EKRA was passed as part of the Substance Use-Disorder Prevention that Promotes Opioid Recovery and Treatment for Patients and Communities Act of 2018 (the “SUPPORT Act”) in response to concerns that the federal Anti-Kickback Statute (“AKS”) was not broad enough to adequately address abusive payment arrangements related to addiction treatment centers. The laws are similar, yet are distinct in several ways. Like the AKS, EKRA makes it a crime to knowingly and willfully solicit, receive, pay or offer any remuneration in order to induce referrals. EKRA, however, only covers arrangements that induce referrals to specific entities: recovery homes, clinical treatment facilities (i.e., certain non-hospital settings that provide substance use treatment), and laboratories. Additionally, EKRA applies to payment arrangements involving all payors, not just those involving federal health care programs like Medicare and Medicaid. Both the AKS and EKRA are criminal statutes with a maximum term of imprisonment of ten years. Both laws provide for several similar safe harbors, but the EKRA safe harbors are narrower in certain respects. For example, although the AKS provides a safe harbor for any payment that is part of any bona fide employment arrangement, EKRA’s employment safe harbor only permits payment that does not vary based on the number of individuals referred, the number of tests or procedures performed, or the amount billed to or received from the health care benefit program from the individuals referred. Thus, EKRA does not protect employment compensation to the same extent that the AKS does.  . Although the DOJ has authority to clarify the law and its safe harbors by regulations, none have been proposed. Since EKRA passed in October 2018, many have raised concerns about whether Congress intended for the law to apply so broadly and whether it will be enforced for activity that was previously permissible under the AKS. The Merced prosecution did not involve employment compensation, so does not shed light on whether DOJ or HHS will pursue criminal enforcement for business practices previously permitted under the AKS. The prosecution also dispels hopes that the DOJ would refrain from prosecuting under the statute until clarifying the law through regulations or guidance. The consequences of EKRA are potentially far-reaching and severe. Until clarifying regulations are promulgated, healthcare providers and other entities should evaluate whether their referral and compensation practices comply with the EKRA safe harbors in addition to the safe harbors of the Stark Law and AKS. Because EKRA applies to all payors, this evaluation should take into account practices related to all claims, not just government-reimbursed claims. We will continue to closely monitor the state of EKRA for guidance, revisions to the law, and enforcement. If you have further questions or need advice on how to restructure payment arrangements to comply with EKRA, please contact the authors or your regular Dorsey attorney.

The Dorsey Health Law blog team keeps readers up-to-date on relevant topics in the health care industry. In order to do so, the members of the blog team communicate regularly with other practice groups within the firm for applicable updates from client publications. For this post, we would like to thank Dorsey’s Lindsey Schmidt for the following post to Dorsey's FCA Now Blog:

The Dorsey Health Law blog team keeps readers up-to-date on relevant topics in the health care industry. In order to do so, the members of the blog team communicate regularly with other practice groups within the firm for applicable updates from client publications. For this post, we would like to thank Kirk Schuler and Alex Hontos from Dorsey's FCA Now blog:

In a growing wave of class action lawsuits, plaintiffs are targeting employers who have allegedly failed to provide proper notice of health care coverage under the Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”).  The wave prompted at least six new lawsuits in 2019 alone, and some have already netted seven-figure settlements.  To avoid this litigation trend, employers should take a hard look at their COBRA notices to ensure they comply with governing regulations. COBRA requires employers who sponsor group health plans to allow plan participants to continue coverage at their own cost when a “qualifying event” occurs that would otherwise terminate coverage.  29 U.S.C. § 1161(a).  The most common “qualifying event” is termination of employment, but there are several others, including the death or divorce of a covered employee.  Under COBRA, plan administrators must provide an individual with notice of the right to continued COBRA coverage (a) when the individual first joins the plan and (b) when a qualifying event occurs.  29 U.S.C. § 1166(a). That COBRA notice must explain the right to continue coverage “in a matter calculated to be understood by the average plan participant.”  29 C.F.R. § 2590.606-4(b)(4).  Federal regulations specify 14 items that the notice should include—for example, an explanation of how to enroll in COBRA.  29 C.F.R. § 2590.606-4(b)(4)(i)-(xiv).  In addition, the Department of Labor (“DOL”) has published a model COBRA notice.  Use of the DOL model notice “is not mandatory.”  29 C.F.R. § 2590.606-4(g).  But according to DOL official publications, use of the model notice represents “good faith compliance with COBRA’s general notice content requirements.” The recent wave of class action lawsuits challenges whether employers’ COBRA notices were sufficient.  While the precise allegations differ, the plaintiffs generally allege that the notice they received did not include all the information set forth in the regulations or in the DOL’s model notice, and that the average plan participant could not understand the notice. Failure to comply with COBRA’s notice requirements can be costly, especially in the context of a class action.  COBRA provides a statutory penalty up to $110 per day per person for failure to provide the required notices.  29 U.S.C. § 1132(c)(1).  The penalty adds up quickly.  Take, for example, a class of 100 employee who lost their coverage one year ago and received a deficient COBRA notice.  The penalty for the employer could be several million dollars, before accounting for an award of legal fees and costs (which COBRA allows). Thus far, employers have been unsuccessful in defeating these COBRA notice lawsuits at the pleading stage.  Some employers have argued that the plaintiff lacked constitutional standing to sue because the alleged defects in the notice—often seemingly innocuous—did not cause any concrete injury.  Other employers have argued they were in substantial compliance with the DOL regulations.  To date, however, those arguments have not convinced courts to dismiss complaints at the pleading stage.  A few of the lawsuits have already settled for seven- and six-figure numbers.  The rest are proceeding forward. There are steps employers can take now to minimize the risk of being swept into this COBRA notice litigation.  To begin, employers should check whether their COBRA notices contain the 14 items suggested by the regulations.  See 29 C.F.R. § 2590.606-4(b)(4) (i)-(xiv).  Employers should also draft their notices in as simple, straightforward language as possible.  In addition, employers should seriously consider using the DOL’s model notice to gain the protection of “good faith compliance.”  Even when using the model notice, it may be appropriate to supplement with additional, plan-specific information. Regardless of whether your COBRA notices could use minor or major changes, now is the time to make those changes.  Doing so could save you from a class action complaint.

In the final quarter of calendar year 2019, the Department of Health and Human Services Office of Inspector General ("OIG") released its Semiannual Report to Congress (the "Report").  The Report covers the six-month period from April 2019 through September 2019 and details for Congress the OIG’s activities during that time and how the office uses its resources. For the six-month period detailed throughout the Report, one thing is obvious: the OIG continued its aggressive approach in pursuing providers of all kinds for suspected fraud and abuse in HHS programs. The Report details how the OIG’s investigative work, in conjunction with other federal and state agencies, led to $2.74 billion in expected investigative recoveries, 388 criminal actions, 364 assessments of monetary penalties, and 1,347 exclusions of individuals and entities from Federal health care program. For comparison, for entirety of 2018, OIG reported expected recoveries of $2.91 billion, criminal actions against 764 individuals or entities, and exclusion of 2,712 entities from federal healthcare programs.   Thus, 2019 was a much more active year for the OIG.  Among other highlights included in the Report, the OIG reports an April 2019 investigation (known as Operation Brace Yourself) that dismantled a healthcare fraud scheme involving over $1.2 billion in losses.  In the alleged scheme, medical professionals working with fraudulent telemedicine companies received illegal kickbacks and bribes from medical equipment companies.  In exchange, the medical equipment companies obtained prescriptions for medically unnecessary orthotic braces and used them to fraudulently bill Medicare.  The operation led to charges against twenty-four defendants across seventeen federal districts. In the six-month period outlined in the Report, the OIG also netted the largest healthcare fraud scheme ever charged by federal authorities.  The fraud scheme involved a record $1.3 billion in claims.  According to the investigation, the leader of the scheme bribed physicians to admit patients into care facilities he owned, and then cycled the patients through facilities in his network.  In addition to billing Medicare and Medicaid for services and prescription drugs that were unnecessary or not provided, witnesses testified that the facilities were in poor condition and provided inadequate care—information that was concealed by bribing a state regulator for advance notice of surprise inspections.  The leader of the scheme was sentenced to twenty years in prison, and his accomplice was sentenced to over six years in prison. The Report also recounts the case of an inpatient rehabilitation company that settled allegations of submitting false patient diagnoses and admitting patients unnecessarily to bolster Medicare payments.  The company allegedly provided false diagnoses on patient assessments to keep its facilities eligible for a special Medicare status that pays a higher rate.  The company also allegedly admitted and billed for Medicare patients that did not need the care they were provided.  The company ended up paying $48 million to resolve the allegations. What this means for you: the OIG's aggressive pursuit of providers for fraud and abuse related to federal and state healthcare programs continues to ramp up, with OIG reporting a $5.4 billion in expected recoveries from FY 2019, which is a significant increase over 2018’s $2.91 billion.  It's critical that providers ensure their operations, including all of their agreements, are up to date with the most current requirements under the law. Hospitals and health systems need to ensure their providers are educated on the fraud and abuse laws and remain diligent in the upcoming year.  To paraphrase, according to Acting Inspector General Joanne M. Chiedi, 2020 will see the OIG continue its bold pursuit of those who attempt to cheat HHS programs or harm HHS beneficiaries and the agency will be resolute in catching and holding accountable perpetrators of fraud and identifying misspent funds.

The Centers for Medicare & Medicaid Services (“CMS”) recently posted two annual updates related to the physician self-referral law (“Stark Law” or “Stark”) on its Stark website: (1) CPI-U updates related to the nonmonetary compensation exception and medical staff incidental benefits exception; and (2) CPT/HCPCS codes used to identify certain categories of Stark designated health services (or “DHS”).  These updates are important for stakeholders to be aware of as they seek to ensure continued compliance with Stark Law requirements. CPI-U Updates As per usual, the CPI-U Updates page of the CMS Stark website, found here, was updated before the end of the year to reflect the new compensation limits (based on inflation) for the nonmonetary compensation exception (at 42 C.F.R. § 411.357(k)) and medical staff incidental benefits exception (at 42 C.F.R. § 411.357(m)).  For calendar year 2020, the non-monetary compensation limit is $423 (up from $416 for calendar year 2019) and medical staff incidental benefits must be less than $36 per occurrence (up from $35 in calendar year 2019). DHS Code List Updates As we explained in our blog post here, in the calendar year 2020 Medicare physician fee schedule final rule (“PFS”), CMS finalized changes to the advisory opinion process under the Stark Law, and also included the annual update to the list of CPT/HCPCS codes used to identify certain categories of DHS (the “Code List”).  As we also explained, the Stark Law regulations at 42 C.F.R. § 411.351 specify that the following four categories of DHS are defined by reference to the Code List: (1) clinical laboratory services; (2) physical therapy, occupational therapy, and outpatient speech-language pathology services; (3) radiology and certain other imaging services; and (4) radiation therapy services and supplies.  The Code List is updated annually to reflect changes in the most recent CPT and HCPCS Level II publications. Further, items and services that may qualify for either of two Stark Law exceptions—the exception for preventive screening tests, immunizations and vaccines at 42 C.F.R. § 411.355(h) and the exception for EPO and other dialysis-related drugs at 42 C.F.R. § 411.355(g)—are identified by reference to the Code List.  The Code List included the annual updates to the codes eligible for the preventive screening tests, immunizations and vaccines exception.  However, as in previous years, the Code List does not include any codes eligible for the EPO and other dialysis-related drugs exception (for reasons explained by CMS in the rule).  The PFS rule includes tables showing the additions and deletions to the Code List. As per usual, the complete Code List was posted before the end of the year to the CMS Stark website dedicated to the Code List, found here.  The new list is effective January 1, 2020.

On December 20, 2019, the Department of Health and Human Services (“DHHS”) issued a notice of proposed rulemaking (the “Proposal”) that removes financial barriers to organ donation by expanding the scope of reimbursable expenses paid through the Health Resources and Services Administration’s Reimbursement of Travel and Subsistence Expenses Incurred toward Living Organ Donation program (the “Program”). Specifically, the Proposal would allow living organ donors to be reimbursed for donation-related lost wages, child-care expenses, and elder-care expenses through the Program. With the Proposal, DHHS is hoping to increase the number of living organ transplants and improve the overall quality and outcome of organ donations. Generally, federal law prohibits any person from knowingly acquiring, receiving, or otherwise transferring any human organ for valuable consideration for use in human transplantation. 42 U.S.C. § 274e. However, valuable consideration does not include “the reasonable payments associated with the removal, transportation, implantation, processing, preservation, quality control, and storage of a human organ or the expenses of travel, housing, and lost wages incurred by the donor of a human organ in connection with the donation of the organ.” Id.  (emphasis added). Therefore, organ donors can be reimbursed for their donation-related expenses under certain circumstances. Primarily to aid low-income organ donors in such reimbursement, 42 U.S.C. § 274f describes the Program, which funds the National Living Donor Assistance Center (the “NLDAC”), to reimburse an eligible organ donor’s qualified expenses. Nevertheless, the Program’s current guidelines specifically limit NLDAC qualifying expenses to only those incurred by the donor and/or his/her accompanying person(s) as part of: (1) donor evaluation and/or (2) hospitalization for the living donor surgical procedure, and/or (3) medical or surgical follow-up, clinic visits, or hospitalization within two calendar years following the living donation procedure. As such, the Program (through the NLDAC), does not currently reimburse organ donation-related expenses such as lost wages, child-care, or elder-care. Rather, reimbursement for such expenses can only be received from sources such as state compensation programs, insurance policies, or the recipient of the organ. This reduces the reimbursement options available, which may be especially significant to the low-income organ donors utilizing the Program. To address this, the Proposal sets out to amend the Organ Procurement and Transplantation Network Final Rule by adding Section 121.14(a), stating: The following incidental nonmedical expenses incurred by donating individuals toward making living donations of their organs may be reimbursed: (1) Lost wages; (2) Child-care expenses; and (3) Elder-care expenses.             The Proposal fulfills the President’s mandate under Executive Order 13879: Advancing American Kidney Health that DHHS propose a regulation to allow living organ donors to be reimbursed for donation-related lost wages, child-care expenses, and elder-care expenses through the Program. Therefore, some form of the Proposal is likely to become final, and DHHS is accepting comments on the Proposal until February 18, 2020. If you would like to submit comments or have any questions, one of the authors or your regular Dorsey attorney would be happy to assist you.

The United States government has an arsenal of agencies and civil and criminal statutes at its disposal to choose from in investigating and combating healthcare fraud.  A recent federal indictment discussed below exemplifies just how multifaceted government investigations and prosecutions can be.  And organizations need to be prepared to respond to such investigations. Last week, the Department of Justice (DOJ) charged fifteen residents of southern Florida in a kickback and bribery scheme involving two VA Medical Centers (West Palm Beach and Miami).  According to DOJ, ten of the defendants worked in the VA medical centers’ logistics departments and had distinct roles in the scheme to defraud.  DOJ also alleged some of the VA-employee defendants would place fake or inflated orders with supply vendors.  Other VA-employee defendants would then allegedly approve the fake orders and still other VA-employee defendants would allegedly falsely enter the supplies as having been received into the VA computer system.  Once paid by the government, the defendant supply vendors allegedly would send a portion of the ill-gotten proceeds to the VA-employee defendants as  kickbacks.  Four individual supply vendors were charged in the scheme.  And although not directly related to the kickback scheme, another individual supply vendor defendant was charged for making false statements in connection with VA application for companies seeking designation as a “Service Disabled Veteran Owned Small Business” (SDVOSB). The charges against the fifteen individuals and supply vendors illustrate not only how seriously DOJ takes allegations of fraud in the healthcare and government-contracting arena, but also some of the statutory tools Congress has given DOJ to fight such fraud in the healthcare system.  Federal statutes specifically criminalize healthcare fraud and conspiracy to commit healthcare fraud, which generally consists of knowingly and willfully executing (or conspiring to execute) a scheme to “defraud any health care benefit program” or to obtain “any of the money or property owned by, or under the custody or control of, any health care benefit program” by false or fraudulent pretenses.  18 U.S.C. §§ 1347, 1349.  The VA is a “health care benefit program,” 18 U.S.C. § 24(b), and the Anti-Kickback Statute provides stiff penalties, including fines and prison time, for fraud involving “federal health care programs” like the VA, see 42 U.S.C. § 1320a-7b.  Civil fines under the Anti-Kickback Statute also can be imposed per violation, potentially exposing organizations to millions of dollars in liability.  Also the government could have invoked—and may well still invoke—the False Claims Act, 31 U.S.C. § 3729, and its remedy provisions, including treble damages and statutory penalties for each claim submitted by the vendors. Those working in or with the VA system (or healthcare or the U.S. government in general) should take particular care to deter and detect fraud and bribery in their organizations.  In this case, for example, ten employees within the Florida VA medical centers alone are alleged to have participated in the scheme.  Such widespread misconduct may have been prevented—or detected sooner—with adequate policies and reporting procedures, better employee training, or regular and systematic audits.  Regular audits, for example, comparing supply inventory as recorded in VA systems with the actual supply inventory received might have deterred or detected the false purchase orders.  Organizations should regularly review their policies and procedures, as well as internal compliance with those policies and procedures, with legal counsel.  Likewise, annual employee training and certification also would serve to educate employees about the applicable laws, rules and regulations and changes to them, how to spot red flags, the obligation to report and the mechanism for reporting suspected activity and the serious consequences for failure to comply.  Organizations should also review with counsel whether their current practices do or can be adapted to meet one of the many “safe harbors” provided for under the Anti-Kickback Statute regulations. Additionally, the charges for making false statements related to the SDVOSB application are yet another example of the breadth of DOJ investigations and enforcement tools.  Federal law broadly criminalizes making certain misrepresentations or omissions “in any matter within the jurisdiction of the executive, legislative, or judicial branch,” see 18 U.S.C. § 1001, which includes government-contracting applications submitted to executive branch agencies like the VA.  So even where a government contractor may not have participated in the criminal conduct being directly investigated (which, here, was the alleged kickback scheme), the scope of DOJ’s investigation can creep into other areas (such as representations on government-contracting applications) which place that government contractor in serious legal jeopardy.  Government contractors should therefore seek legal counsel before and while participating in any DOJ investigations.  Government contractors should also, as a preventative measure, seek legal counsel related to the representations they make on government applications so that they do not make misrepresentations in the first place. Staying compliant with the laws, rules and regulations governing healthcare providers, vendors, and suppliers requires diligence and vigilance.  In this ever changing and complex landscape companies and their employees must be pro-active in their efforts to combat fraud and to respond to governmental inquiries and investigations.