A medical imaging company is paying for its flawed data security system. In addition to its system failures, the company failed to investigate and respond properly when alerted to problems by the FBI. As a result, the Office of Civil Rights imposed a $3 million penalty and required a corrective action plan. This yet another warning to the health care industry that data security matters. Office of Civil Rights Enforcement The Office of Civil Rights…

As previously reported, last December the U.S. District Court for the District of Columbia ruled that the Department of Health and Human Services (HHS) had overstepped its bounds when it slashed the 2018 Medicare Part B outpatient reimbursement rates for covered drugs purchased under the 340B Program. AHA v. Azar, 1:18-cv-2084-RC (D.D.C. December 27, 2018). The court, however, held off on imposing a remedy until after the parties first had the opportunity to provide…

The Department of Justice just released new guidance how to obtain credit for cooperation under the False Claims Act (FCA).  The guidance stresses the importance of cooperation but mentions other actions as well.  The FCA greatly impacts the health care sector, with settlements and judgments reaching to billions of dollars.  Please see the post on the Anticorruption blog for a description of this guidance.…

When healthcare entities are seeking to expand their operations, they often will find interesting targets who have union-represented employees.  A union’s presence will create additional compliance obligations but, contrary to common misconceptions, union-related obligations are not necessarily unmanageable. In a recent case, which arose after new owners took over a skilled nursing home facility, the National Labor Relations Board reiterated the standards that will determine whether a buyer must recognize the seller’s former labor union,…

On February 6, 2019, the Department of Health and Human Services (HHS) published a Proposed Rule modifying the Anti-Kickback Statute safe harbor protection with the aim of lowering prescription pharmaceutical product prices and out-of-pocket costs for (primarily Medicare Part D and Medicaid Managed Care Plan) consumers. With the Proposed Rule, HHS hopes to encourage medication manufacturers to pass discounts directly to consumers and develop a transparent framework for the prescription pharmaceutical product market.  A more…

A lapse in federal funding, or a government shutdown, occurs when Congress and the President fail to agree to a new appropriations bill for oneor more of the federal government agencies. The most recent partial government shutdown, ending in January 2019, affected about 25% of government agencies (in dollar terms). The Department of Homeland Security and the Food and Drug Administration (FDA) were among those agencies whose ability to spend new funds were impacted by…