More than three years after the COVID-19 pandemic began, many healthcare institutions continue to have difficulty fully staffing all their facilities. In response, both the Oregon and Washington legislatures enacted new laws that will change how hospitals plan for and staff their facilities. While both states will send shockwaves throughout their hospitals, the approaches differ
CMS Takes Significant Action to Spur Use of Telehealth Services for Duration of COVID-19 Emergency
On March 13, 2020, President Donald Trump issued a proclamation declaring a national emergency concerning the novel coronavirus disease (the “Emergency Declaration”). The president framed the emergency declaration as empowering the Secretary of Health and Human Services (“HHS”) to waive “laws to enable telehealth,” which gave providers hope that the administration would remove some of the primary regulatory barriers to the broad implementation of telehealth services. In the days since the declaration, the administration has taken increasingly significant steps to do just that.
The Emergency Declaration authorized the Secretary of HHS to exercise his waiver authority under Section 1135 of the Social Security Act (42 U.S.C. § 1320b–5). Section 1135 empowers the Secretary to waive or modify only certain provisions under Medicare, Medicaid, the Children’s Health Insurance Program (“CHIP”), and the Health Insurance Portability and Accountability Act (“HIPAA”) during a national emergency. Congress broadened these waiver authorities in the emergency supplemental appropriations bill, signed into law on March 6, which gave the Secretary additional authority under Section 1135 to loosen Medicare’s telehealth billing standards. It also specifically allowed the Secretary to waive the requirement that the beneficiary live in a rural area and receive the services at an approved remote site, such as a rural hospital.Continue Reading CMS Takes Significant Action to Spur Use of Telehealth Services for Duration of COVID-19 Emergency
Effects of State Individual Mandates on Employer Group Health Plans
Late last year, Congress passed the Tax Cuts and Jobs Act, which included a provision effectively repealing the requirement for most Americans to have health insurance. This “individual mandate” was originally imposed by the Affordable Care Act (“ACA”). Beginning in 2019, the tax penalty individuals face if they do not enroll in health coverage considered minimum essential coverage (“MEC”) will drop to zero.
For many Americans, the individual mandate was satisfied by the health coverage provided by employers. From an employer perspective, the repeal of the individual mandate penalty might first appear to have little effect. The ACA’s employer shared responsibility provisions (also known as the “pay-or-play penalties”) remain intact, and applicable large employers (“ALEs”) will likely continue to provide group health coverage to employees and their dependents even though the individual mandate is no longer in effect. And though the Congressional Budget Office projected that an additional 4 million individuals will go uninsured when the federal penalty disappears, most of these individuals were previously insured in the individual market, not the group market.
But the repeal of the federal penalty has spurred activity at the state level that will require employer attention. Many states are concerned that the resulting increase in uninsured individuals will further strain state safety nets, resulting in accelerated efforts to strengthen state insurance markets by imposing state-law individual mandates to reduce the rate of uninsured individuals.
Continue Reading Effects of State Individual Mandates on Employer Group Health Plans
Ninth Circuit Takes Broad View of What Is Required for a Licensee to Be “Independent”
On July, 23, 2018 a three-judge panel in the Ninth Circuit issued a decision in Obidi v. Wal-Mart Stores, Inc. (Case No. 17-55539), holding that a class-action suit against Wal-Mart and FirstSight Vision Services, Inc., a vision-only health care plan, can proceed on the theory that the defendants violated various California consumer protection laws by advertising “Independent Doctors of Optometry” that were, in fact, controlled by Wal-Mart and FirstSight. Though the decision is a narrow one (addressing only whether the plaintiffs have standing to sue), its reasoning could be relevant for how retail clinics and other corporate entities structure their relationships with physicians and other licensees to comply with state corporate practice of medicine (“CPOM”) rules.
Background of the Case
Wal-Mart stores across the country include on-site “Vision Centers” that offer basic eye exams, contacts, and prescription glasses. In California, Wal-Mart is registered as an optician and leases space in its stores to FirstSight, a licensed vision health plan. FirstSight, in turn, subleases this space to individual optometrists who charge patients directly. Wal-Mart and FirstSight advertised that the Vision Centers were staffed by “Independent Doctors of Optometry.” A former patient filed a putative class-action suit alleging Wal-Mart and FirstSight violated California’s Unfair Competition Law because (a) the defendants falsely advertised that the optometrists were “independent” and (b) the business arrangement between Wal-Mart and FirstSight was an unlawful relationship between an optometrist and an eyeglass retailer.
The plaintiff alleged that she would not have purchased an eye exam if she had known that the optometrist was not “independent.” The Ninth Circuit considered the key question to be whether the plaintiff had “adequately alleged that her optometrist lacked independence.” The court answered in the affirmative, relying on various provisions in the leasing arrangement that, as a whole, indicated that “Wal-Mart and FirstSight were able to exercise undue influence over all their resident optometrists.” Evidence of such “undue” influence included Wal-Mart “setting rent as a percentage of revenue, prescribing minimum operating hours, and permitting the lessor to terminate leases at will.” The court also noted that there was anecdotal evidence that optometrists at other Wal-Mart locations were constrained in the rates they could charge and the therapies they could recommend.
However, the Ninth Circuit affirmed the dismissal of the claims based on violations of California laws that prohibited, among other things, retailers from directly or indirectly employing or maintaining an optometrist in stores that sell eyewear. The court reasoned that the plaintiff “fail[ed] to establish how her injury was fairly traceable to the purported statutory violations.”
Continue Reading Ninth Circuit Takes Broad View of What Is Required for a Licensee to Be “Independent”
ACA Debate Intensifies Ahead of Midterm Elections
Ten Republican Senators have introduced a bill that they say will require health insurers to cover pre-existing conditions if the Affordable Care Act (“ACA”) is invalidated. Critics counter that the bill offers little actual protection. Like the ACA, it would prohibit insurers from denying enrollment based on pre-existing conditions, but unlike the ACA, it would not require insurers to cover the conditions themselves.
The bill is the latest volley in an ongoing battle over the fate of the ACA. Here are some key steps that set the stage:
- The 2017 tax bill eliminated the ACA tax penalty on individuals who do not have health insurance, effective as of 2019. This is one of two elements that has brought more healthy people into the individual market; the other is subsidized plans for those in lower income brackets.
- In April 2018, CMS and HHS issued a rule permitting states to establish the levels of coverage insurers must offer in their health plans. Federal law no longer requires insurers to cover all of the ACA’s “essential health benefits.”
- This month, hearings in Texas v. United States begin. A group of 20 states will argue that the tax penalty is a constitutional linchpin of the ACA, without which the law is invalid. The states also are asking for a preliminary injunction to halt operation of the ACA while the case is litigated. Seventeen states have filed an opposing motion.
- The Justice Department is not defending the ACA in the Texas case. It has suggested that without the tax penalty, some parts of the ACA may still be valid, but the individual mandate, the pre-existing condition coverage requirement, and the prohibition on charging higher premiums based on medical history are not.
Continue Reading ACA Debate Intensifies Ahead of Midterm Elections