American Hospital Association Sues HHS over 340B Changes
The American Hospital Association, America’s Essential Hospitals and the Association of American Medical Colleges, along with three health systems, including Eastern Maine Healthcare Systems, Henry Ford Health System and Park Ridge Health, filed suit
against the U.S. Department of Health and Human Services as a result of a rule change affecting the 340B Drug Pricing Program.
The lawsuit is attempting to stop payment cuts for drugs purchased through the 340B Drug Pricing Program. Under the Centers for Medicare and Medicaid Services’ 2018 Medicare Outpatient Prospective Payment System rule, Medicare payments to hospitals would be reduce by $1.6 billion. Plaintiffs argue the 340B provisions violate the Social Security Act and allege the reductions exceed the HHS Secretary’s statutory authority. Plaintiffs are seeking a declaratory judgement that the 340B provisions are unlawful and outside the Secretary’s scope and an order requiring HHS to strike the 340B payment methodology changes and revert to the methodology used in 2017. In the alternative, Plaintiffs are seeking an injunction that would prohibit the implementation of the 340B provisions pending the resolution of the lawsuit.
United For Missouri Files
Lawsuit Against St. Charles County PDMP
United for Missouri, an organization run by former state representative Carl Bearden, filed suit against the St. Charles County prescription drug monitoring program and the director of the St. Charles County Department of Public Health. The suit alleges the St. Charles County PDMP violates the protections against unreasonable search and seizure provided in the Fourth Amendment of the U.S. Constitution, and similar protections provided in Article I, Section 15 of the Missouri Constitution. The suit also alleges that the program violates certain Missouri statutes relating to the regulation of prescription information and pharmacies.
UPDATE: On Sept. 14, Defendants removed the case to federal court. The case is now in the United States District Court for the Eastern District of Missouri.
Federal Court Orders Illinois to Pay Medicaid Providers
On June 30, the United States District Court for the Northern District of Illinois ordered the State of Illinois to pay $586 million per month to Medicaid providers. The order impacts vouchers first submitted after June 30, 2017, on behalf of Medicaid providers, including managed care organizations. Beginning July 1, 2017, Illinois must also pay $2 billion toward reducing the backlog of approximately $4.14 billion of unpaid vouchers that were previously submitted for Medicaid services. The Court ordered Illinois to appropriately prioritize payments to safety net hospitals and other providers that are most crucial to affording access to federally mandated health care services.
Conflicting Issues Exist Under Missouri's Blood Draw Statutes
Missouri is among the states with an “implied consent” law with respect to alcohol and drug tests; however, such laws may conflict with constitutional protections against unreasonable searches. Section 577.029, RSMo, requires physicians, registered nurses, phlebotomists and trained medical technicians to withdraw blood at the request of a law enforcement officer. Section 577.031, RSMo, protects medical personnel from liability for so doing absent gross negligence, willful or wanton acts or omissions. However, the U.S. Supreme Court has held that forced submission to blood tests may violate the constitution. Birchfield v. North Dakota, 136 S. Ct. 2160 (2016); Missouri v. McNeely, 133 S. Ct. 1552 (2013).
County hospitals are subject to such constitutional restrictions and should consult with counsel to establish an appropriate policy with respect to blood draws. Nongovernmental hospitals also should be aware of the implications of performing blood draws without patient consent. Missouri’s implied consent statutes do not prevent an individual from suing for battery for drawing blood without consent. Since collecting the specimen is a willful act, it is not clear that the protections of Section 577.031 would shield the provider from liability. Members are encouraged to engage in a dialogue with local law enforcement so that they are aware of, and clearly understand, the hospital’s policy and can avoid escalating the issue. For more information, please see MHA’s previously published guidance
on this topic. Additionally, a webinar addressing federal and state laws related to blood draws is available under the “Resources” tab.
The Health Insurance Portability and Accountability Act, better known as HIPAA, protects individuals’ health information from inappropriate uses or disclosures. The law establishes standards for the release of protected health information by covered entities, which include health care providers, health plans and health care clearinghouses (such as medical billing services). Protected health information includes medical information in both printed and electronic form. In addition to the privacy rule, which governs the disclosure of protected health information, HIPAA security regulations require covered entities to maintain certain physical plant and electronic standards to guard against inappropriate access to PHI. For a summary of the HIPAA Privacy Rule, please visit the U.S. Department of Health & Human Services' website.
OCR Guidance on Reasonable Charges for Patient Access to PHI
The Office of Civil Rights recently issued guidance regarding a patient’s ability to access his or her PHI, which may limit the fees providers can charge for supplying patients with copies of their medical records. The Privacy Rule authorizes covered entities to charge a reasonable, cost-based fee to individuals requesting access to their own PHI. According the rule, the fee may only include the cost of labor for copying the records (whether in paper or electronic form), supplies for creating the records (paper or electronic media) and postage if the individual has requested that the records be mailed. 45 C.F.R. § 164.524(c)(4).
The guidance goes on to state that charges associated with searching for and retrieving PHI, or maintaining systems or infrastructure to store PHI, are prohibited, even if such charges are authorized by state law. Section 191.227.2(1)(a), RSMo currently authorizes search and retrieval fees of $24.57, and additional labor costs of $23.00 if the materials are stored offsite. The statute permits a $0.56 per page charge for the cost of “supplies and labor.”
OCR would likely view Missouri’s search and retrieval fees as prohibited by the Privacy Rule. And, while HIPAA authorizes a “reasonable, cost-based fee” for the labor and supplies necessary to copy records, the Missouri statute would arguably limit those charges to $0.56 per page. OCR limits those fees to actual costs incurred.
OCR released FAQs with its new guidance, in which it states that the limits also apply when an individual directs that his or her PHI be sent directly to a third party. However, when a third party directly requests PHI from a provider on the basis of a written HIPAA authorization from the individual, the fee limitations would not apply.
Change in HIPAA Privacy Rule to Allow Disclosures to Criminal Background Check System
On Jan. 6, the U.S. Department of Health & Human Services filed its final rule implementing the latest changes to the HIPAA privacy rule. The rule authorizes certain covered entities to disclose to the National Instant Criminal Background Check System PHI of individuals subject to a federal “mental health prohibitor” disqualifying them from possessing, receiving, shipping or transporting a firearm. Under the Gun Control Act of 1968, mental health prohibitors apply to an individual who has been involuntarily committed to a mental health facility, lawfully found to be a danger to his/herself or others, incompetent to stand trial or manage his/her own affairs or the subject of a not guilty verdict by reason of insanity.
The new rule applies to only two types of covered entities — those with legal authority to adjudicate or make commitment decisions that render individuals subject to the federal mental health prohibitor and those that are repositories of NICS reporting information. Such entities would generally include state agencies, such as mental and public health departments. The narrow scope of the rule came in response to comments expressing concern that the rule would discourage individuals from seeking mental health treatment. The rule also limits the disclosures to information needed for NCIS purposes and prohibits disclosure of clinical or diagnostic information. Finally, while the rule allows for such disclosures, it does not mandate that covered entities report to the NCIS. Covered entities are not authorized to report individuals subject to a state mental health prohibitor.
The Missouri Society of Health Care Attorneys is a personal membership group of the Missouri Hospital Association. MSHCA was formed in 1981 and remains a robust network of approximately 150 health care attorneys across the state. Its members practice in every facet of health care, as in-house counsel, state regulatory officials and in law firms large and small. MHA’s General Counsel and Vice President of Legal Affairs serves as a permanent member of the board, and the office provides ongoing operational support for the group.
MSHCA is governed by a board of directors and supported by various committees. The group holds a day-long, health-law seminar each November in conjunction with the MHA Convention and Trade Show. The keynote session, known as the Holderle Lecture, attracts dynamic national speakers on emerging issues in health law. The remaining sessions cover topics applicable to various aspects of health care practice. MSCHA also partners with the MoBar Health and Hospital Law Committee to provide joint programming at the spring and fall committee meetings.
MSHCA members have access to various MHA publications, including MHA Today, a daily publication of health care news. MHA Today includes links to relevant documents and additional educational materials. MHA, with MSHCA support, publishes other documents focusing on Missouri health law.
Membership in MSHCA is a cost effective way to receive health care education and information from MHA. If you are interested in joining or would like additional information, please contact MHA’s Associate General Counsel Meghan Henderson or her assistant Tammy Siebert.
Federal and State Laws Related to Blood Draws and Requests from Law Enforcement
PowerPoint | Recording
OCR Guidance on HIPAA and Cloud Computing
Model Medical Staff Bylaws
MHA developed the Model Medical Staff Bylaws
to provide guidance to MHA’s member institutions in drafting new bylaws, modifying current bylaws or as a basis for reviewing current bylaws.
The draft of the Model Medical Staff Bylaws was prepared by Stacy Harper and Donn Herring of the law firm Lathrop and Gage L.L.C. The firm has a regional health law practice representing a variety of health related clients, both professional and institutional, including many hospitals of various sizes in both urban and rural settings.
Many changes in health care law and regulations in the last few years require a hospital’s medical staff bylaws to be a dynamic document. The medical staff bylaws should be reviewed periodically to insure its provisions are up to date. The Model Medical Staff Bylaws provide an opportunity for hospitals to insure their own medical staff bylaws serve the best interests of the hospital, the medical staff and patients.
The Model Medical Staff Bylaws is designed to be a resource and a guide. The presentation of the bylaws does not constitute legal advice and should not be relied upon as such. Although development of medical staff bylaws in a hospital should be a process involving an interdisciplinary group or committee of the hospital and hospital medical staff, the hospital’s legal counsel should be an integral part of the process. Hospital medical staff bylaws involve many legal concepts. Consultation with legal counsel experienced in hospital medical staff bylaw drafting is critical.