|
Welcome
Welcome to our third issue of The Health Record - our healthcare law insights e-newsletter!
We are winding down the summer with our talented group of law students and they have continued to research and write, shadow our attorneys, and learn about the practice of law in a firm setting. As young professionals still deeply involved in higher education, our Summer Associates are contributing to our summer publications and sharing their perspectives as both students and future legal practitioners. We welcome Sarah King, Gabriel Papadopoulos and Addelyn Slyh to The Health Record team for this summer edition.
It feels like this year is flying by. Earlier this year, the regulations implementing the Corporate Transparency Act took effect, imposing requirements on certain businesses to submit information to the Financial Crimes Enforcement Network (FinCEN) about the beneficial owners of the business. For more information about who is required to file a report, who is considered a beneficial owner, and what information must be reported, please see our firm's prior update on this topic, which can be found here or FinCEN’s FAQs, which can be found here.
If your company was formed before January 1, 2024, your initial report is due by December 31, 2024 – less than six months from now. If your company was formed between January 1, 2024 and December 31, 2024, your initial report is due within 90 calendar days of the date the entity is formed. Companies formed on or after January 1, 2025, will have 30 calendar days from their formation to file their reports.
If you have not already done so, we encourage you to determine whether your company is required to file a beneficial owner report. If you are required to file a report, we encourage you to begin collecting the information needed to make the submission. Please contact us if you have any questions about your reporting obligations or would like assistance with filing your initial beneficial owner report.
We hope you enjoy this issue of The Health Record. Thank you for reading!
Brienne T. Marco
Member, Chair of the Corporate Department and Co-Editor of The Health Record
and
Joel P. Jones, Jr.
Counsel and Co-Editor of The Health Record
| |
|
“The decision could cripple the ability of HHS and CMS to address critical issues such as regulating rapidly evolving technology like AI.”
Why this is important: Last month, the United States Supreme Court issued a landmark ruling in the cases of Loper Bright Enterprises v. Commerce and Relentless Inc. v. Commerce, overturning a decades-old legal doctrine known as the Chevron doctrine. Under the Chevron doctrine, courts gave deference to federal agencies’ interpretations of federal statutes if the federal statute was ambiguous and the agency’s interpretation was reasonable. Following the Supreme Court’s decision, courts will be permitted to exercise independent judgment in interpreting federal laws and will not be bound by interpretations made by federal agencies based on the agencies’ technical expertise. In a dissenting opinion, authored by Justice Elena Kagan, and joined in by Justices Sotomayor and Jackson, Justice Kagan wrote that the majority's decision “puts courts at the apex of the administrative process as to every conceivable subject — because there are always gaps and ambiguities in regulatory statutes, and often of great import.”
The Court’s decision is expected to have mixed implications for the healthcare industry, including the disruption of agency rulemaking efforts by federal agencies such as the Department of Health and Human Services (DHHS) and the Centers for Medicare and Medicaid Services (CMS). It is also expected to lead to greater uncertainty and an increase in legal challenges to federal healthcare regulations for programs such as Medicare and Medicaid. Indeed, we have already seen rulings from lower courts applying the Supreme Court’s decision overruling the Chevron doctrine. Three federal district courts have issued stays and preliminary injunctions barring DHHS from enforcing provisions of an Affordable Care Act non-discrimination rule as applicable to gender transition services. Additionally, the decision will impact an appeal of a lower court’s ruling in Hakensack Meridian Health’s case against DHHS over the calculation of Medicare reimbursement used to determine Disproportionate Share Hospital payments. --- Brienne T. Marco
| |
|
“The Supreme Court’s decision to overturn the Chevron doctrine would make it easier to challenge agency regulations, such as the LDT final rule.”
Why this is important: In the wake of the Supreme Court’s decisions in Loper Bright Enterprises v. Commerce and Relentless Inc. v. Commerce, overturning the Chevron Doctrine, federal agencies will no longer receive the deference in administrative rule-making that they once enjoyed. One such agency is the Food and Drug Administration (FDA). Recently, the FDA promulgated new regulations under which the FDA now defines Laboratory Developed Tests (LDTs) as medical devices and, consequently, subjects LDTs to heightened regulatory oversight. These regulations have been met with industry opposition and judicial challenges that may be an early, pointed test of agency authority absent the deference granted by the Chevron Doctrine. This article dives into details of the fight over LDTs and how Relentless could affect the FDA’s regulatory authority. --- Matthew W. Georgitis
| |
|
“When it comes to adopting healthcare AI, large, well-off hospitals are likely to frequently homer while smaller, struggling institutions go down looking.”
Why this is important: AI is projected to be a revolutionary tool in medicine. However, not everyone may benefit equally from this new advancement. Better-off medical institutions, and their patients, will benefit more from the introduction of AI than small, less well-off medical institutions. This will create a disparity of care based on pure economics. There are steps that can be taken to avoid this outcome. The first is to have government policies that will provide funding, training grants, and partnership mandates to assist smaller community hospitals in accessing AI tools. Another way to avoid the inequitable application of AI technology is to increase AI-related education in both academic and continuing education settings. Finally, encouraging collaboration and the sharing of AI tools between larger hospitals and smaller ones. These regional AI hubs would permit less advantaged medical institutions and their patients to have access to these AI tools. By taking these steps, access to advanced AI tools can be guaranteed to all patients. --- Alexander L. Turner
| |
|
“More than half of rural U.S. hospitals now lack labor and delivery services.”
Why this is important: Hospitals are closing their labor and delivery units, especially in small towns, because fewer babies are being born and rural hospitals lack the appropriate number of staff to safely facilitate labor and delivery units. West Virginia has had a 62 percent drop in births in the past 65 years. The closure of labor and delivery units in hospitals requires pregnant mothers in small towns to travel further distances for prenatal healthcare and delivery services. While it may not be an issue for some, women who lack reliable transportation or flexibility in their work schedules are facing challenges obtaining healthcare during their pregnancies. This can result in women having complications related to traveling for healthcare. --- Charity K. Lawrence
| |
|
“Bills to ban transgender health care for people under the age of 18 have been the subject of capitol protest rallies in West Virginia, Ohio and Kentucky.”
Why this is important: In June 2024, the Supreme Court granted certiorari on United States v. Skrmetti which challenges a Tennessee law that bans gender-affirming healthcare for transgender minors. The issue the Supreme Court will hear is whether (and, if so, how) states can ban gender-affirming health care like puberty blockers and hormone therapy for transgender minors.
With persistent movement in the legal landscape surrounding transgender issues in recent years, bills that restrict a minor’s access to puberty blockers and hormone therapy for gender-affirming purposes have been sweeping the country. These bills have been the subject of capitol protest rallies in many states, including West Virginia, Ohio, and Kentucky. These three states are among 25 states that have banned the prescription of gender-affirming medications to transgender minors. Notably, West Virginia’s bill contains a unique exemption. Doctors in West Virginia are permitted to prescribe puberty blockers and hormone therapy if a teenager is considered at risk for self-harm or suicide. The prescribing doctor must receive parental consent and a diagnosis of severe gender dysphoria from two clinicians, including a mental health provider or an adolescent medicine specialist.
Healthcare providers in these states will want to know who the ban applies to. In some states, a minor may continue to be prescribed hormone therapy or puberty blockers if they were being prescribed this before the bill went into effect. In West Virginia, the bill will not apply to patients who received hormone treatment before the bill's passage. The same is true for patients in Ohio if the prescribing doctor shows that terminating the minor’s prescription would cause harm to the minor. In Kentucky, the bill does not apply to a minor diagnosed or born with a sexual development disorder. A doctor in Kentucky may institute a period during which the minor’s use of the prescription is systematically reduced if immediately taking the minor off the prescription would cause harm to the minor.
Healthcare providers should know the professional and criminal liability for continuing to prescribe these medications in a way not consistent with state law. In Ohio and Kentucky, a doctor could lose their medical license if they prescribe hormone treatment to a transgender minor. Criminal charges for a doctor who prescribes these medications will vary among the states.
Healthcare providers in states that have enacted these restrictive laws should know the parameters within which they can communicate with their patients regarding access to gender-affirming medications. These communications may include out-of-state options; however, it is noteworthy that healthcare providers must be informed on what their state considers “aiding and abetting” someone in violation of a state law. In Ohio, for example, a health care provider breaks the law when they engage in conduct that aids or abets in prescribing hormone or puberty-blocking drugs to a minor.
The West Virginia and Kentucky bills are in full effect; however, Ohio’s bill is currently on hold due to an injunction. Those within Ohio’s healthcare arena should pay close attention to the bill’s status. Healthcare providers in any state that has enacted restrictive bills regarding gender-affirming care must also pay close attention to the Supreme Court decision on this issue. The Supreme Court could deem these bills enforceable to their full extent, rule that any bill restricting access to gender-affirming care from minors is not enforceable, or anything in between. --- Sarah W. King
| |
|
“It allows doctors to provide some medications and treatments that aren't approved by the Federal Drug Administration.”
Why this is important: The Right to Try Act provides terminally ill patients access to experimental drugs that have only undergone Phase 1 Testing and have not been approved by the Food and Drug Administration. This gives patients the chance to benefit from promising unapproved drugs without having to wait for the drug to be approved. While federal Right to Try laws have only existed since 2018, state laws on the topic have existed since 2014 and have been adopted in 41 states.
North Carolina passed its first Right to Try law in 2015 and state lawmakers are now attempting to expand the law. The new legislation passed its first committee vote and would extend Right to Try to genomic and genetic treatments. This would provide easier access to patients with rare conditions who have had to leave the country to obtain treatment or were left with no treatment options. If passed, North Carolina would become only the third state behind Arizona and Nevada to expand their Right to Try laws. The bill would not require insurance to cover the treatments, and would not hold the manufacturer legally responsible if the patient dies using their experimental drug.
Another healthcare bill received backlash at the May 22nd North Carolina Senate Health Committee Meeting. House Bill 681 would allow doctors licensed in other states to practice in North Carolina and potentially solve the state’s healthcare shortage problem. While this provision of the bill has received bipartisan support, changes to the bill known as the “Healthcare Flexibility Act” would provide regulations for surprise medical billing, healthcare facility fees, rules for anesthesiologists, and allow nurses to practice without doctor supervision. Despite receiving mixed reactions, the bill passed the committee, but is likely to face further opposition in the House. --- Gabriel P. Papadopoulos
| |
|
“Companies like Hy-Vee and Kroger are freeing up pharmacists to interact more with customers and offering an expanding range of healthcare services.”
Why this is important: An important question asked by many today is: “What do you do with an industry or asset that doesn’t seem to be making money the way it used to?” You innovate! You create change and integrate new services. This is exactly the approach that many grocers are implementing, to not only hang on to the traditional roles that they previously had, but also present customers with an array of new services.
This new array of services begins with a foundation of customer care. Grocers are moving towards an approach that is centered around connecting with the customers and creating an emotional and personal relationship. Grocers such as Hy-Vee and Kroger are offering access to dietitians, mobile health units, supplemental programs, and even placing pharmacists out on the floor to answer questions. By offering these various services, grocers are creating an industry focused on full-picture care, not just staying behind the counter and filling prescriptions. When a pharmacist steps out from behind the counter, a barrier is broken, and when a barrier is broken, possibilities flood in.
A good pharmacy is one with a differentiated experience. Kroger’s CEO Rodney McMullen said that customers who are pharmacy patients are more loyal to the business than non-pharmacy patients. This loyalty comes back to the foundation of customer care, to stepping out from behind the counter. Perhaps the real success that grocers are seeing is due to connection, which leads to loyalty, which creates long-lasting relationships between pharmacists and patients. --- Addelyn C. Slyh
| |
|
“The survey measures six performance indicators, including job satisfaction, job stress, burnout, intent to leave an organization, feeling valued by an organization and total hours spent per week on work-related activities.”
Why this is important: A large nationwide physician survey of job satisfaction was recently conducted by the American Medical Association (AMA), showing shifts in physician sentiment and satisfaction. The survey was conducted in 31 states, reaching 81 health systems and 12,400 physicians. The survey showed directionally consistent improvements in several metrics, over studies performed in 2022 and 2023: Job satisfaction rose to 72.1 percent over 68 percent in 2022; percentage of physicians who felt valued by their organizations rose to 50.4 percent, compared to 46.3 percent in 2022; 16 percent did not feel valued at all, compared to 18 percent in 2023; and reports of substantial job stress decreased from 55.6 percent in 2022 to 50.7 percent in 2023. Physician burnout was reported in 48.2 percent of respondents, which is an improvement from 63 percent in 2021, and below 50 percent for the first time in four years.
While the survey shows improvement in all measured categories of physician job satisfaction, the improvements are generally incremental, and show there is much room for improvement. Physician happiness translates to better care and patient satisfaction. Furthermore, the cost of dissatisfaction is substantial. The survey estimates that burnout costs the U.S. healthcare system $4.6 billion per year, due to turnover and reduced work hours. --- Anthony L. Huber
| |
|
“Some respondents said virtual visits help reduce the stigma of substance abuse disorders.”
Why this is important: Research and anecdotal evidence have identified many barriers to addiction recovery. Among those barriers are accessibility barriers (Is treatment available nearby?), transportation barriers (Does the patient have the means to get to the facility?), financial barriers (Can the patient afford treatment or is the patient sufficiently insured?), stigma (Are there societal or personal pressures that discourage treatment for a particular patient?), and many others.
Telemedicine seems to lessen several barriers to care, not the least of which are stigma and transportation, allowing patients to access providers in relative privacy. Telemedicine, however, is not without its own barriers or challenges.
First, certain types of addiction treatment require at least some in-person patient encounters because certain types of drugs commonly used in addiction medicine either cannot be prescribed via telemedicine or the ability to prescribe the drugs is limited in the telemedicine context. Similarly, certain types of drugs require frequent visits to providers because certain types of drugs are not able to be dispensed at a pharmacy in the way that most people are accustomed to. Thus, even aside from the provider encounter, the patient must regularly report in person just to receive medication. To complicate matters further, these drugs are regulated at the federal, state, and sometimes local level.
Second, certain types of treatment offer more comprehensive services than just patient encounters with physicians. By now, most people have heard of medication-assisted treatment or “MAT”, which is just that – treatment that is assisted by medication. MAT is a comprehensive addiction treatment model that has a more wholistic approach to addiction treatment. MAT facilities frequently offer these services in one location for the convenience of patients. Thus, a patient exclusively using telemedicine would not necessarily receive the benefit of the full treatment regime at a MAT facility.
In sum, the research seems to have demonstrated (perhaps predictably) that telemedicine removes barriers of stigma to treatment, but limitations on the prescription and dispensing of certain drugs used in addiction treatment inherently limit the use of telemedicine. When utilized, it must be at the discretion of the provider and, therefore, depends on the circumstances of the particular patient. As attorneys in the healthcare industry, it is critical to advise healthcare clients in order to maintain regulatory compliance while recognizing their goals of delivering effective healthcare to vulnerable patient populations. --- Joel P. Jones, Jr.
| |
|
"Legislation currently before Congress (Senate Bill 2209 and House Bill 4128), the Verifying Accurate Leading-edge IVCT Development Act (VALID Act), codifies this firm-based approach to regulation.”
Why this is important: Legislation like the VALID Act aims to modernize FDA oversight by focusing on the development methods and reliability validation of technologies rather than their construction. This approach is essential for AI medical devices, which require continual updates and improvements.
AI medical devices, such as those using large language models, present regulatory challenges due to their complexity and potential for inaccurate outputs if trained on unreliable data. Developers are cautious, often classifying AI tools as non-device clinical decision support software to avoid stringent FDA scrutiny.
The proposed VALID Act would enable the FDA to oversee and regulate in vitro clinical tests (IVCTs), which include in vitro diagnostic devices like wearable health trackers and the software that supports them. The challenge, however, is the constantly evolving nature of AI-based diagnostic tools that inherently modify themselves as new information is collected. The VALID Act will seek to balance the needs for both regulatory oversight and rapid innovation in the diagnostic space. --- Shane P. Riley
| |
Feature Attorney Question & Answer | |
We are excited to introduce you to our large healthcare law team. To help you get to know our team a little better, we are highlighting an attorney in each issue by asking them a healthcare-related question. We hope their response will be insightful for you. | |
|
Patent law and intellectual property law are very unique areas, and this is especially true when it comes to the healthcare industry. While there are nuances, there are some tried and true issues to focus on when it comes to IP. We tapped our own Shane Riley, Counsel and Chair of our Intellectual Property Group, to discuss what to be highly aware of when it comes to all things healthcare-related from an intellectual property law point of view.
Shane P. Riley, Counsel and Chair of the Intellectual Privacy Group
"I think we all know that IP law can be really complicated and having a partner who is extremely well-versed in this area can truly be invaluable. And while different scenarios can be very complex, there are a few basic and essential things you should pay close attention to when it comes to your legal counsel and any healthcare-related issues.
Patents are the lifeblood for many healthcare institutions. Research and development bring about inventive techniques, devices, and procedures. You need to make sure your patents are well-secured for drug-related pharmaceuticals, including biologics, before going to market. Medical devices can be especially prone to infringement issues so having strong patents in place and a vigorous enforcement plan is essential.
Any sort of clinical trial will have trade secrets and even the manufacturing process has a variety of trade secret issues. Your attorney should not only be well aware of the legal ramifications of protecting trade secrets, but they should also understand your trials and manufacturing processes. It’s not enough to have an attorney review these things. They should completely understand your mission, desired outcomes, and the particular field of technology.
Copyrights for software, databases, educational materials and publications must also be taken into consideration and protected. This holds true for brand name trademarks, as well. While counterfeit products have always been an issue, handling trademark infringement regarding those products can leave you in very unfamiliar territory. Expertise in trademarks is pivotal for success.
As we all know, collaboration is key for many healthcare institutions. All healthcare institutions should be vigilant about making sure their work product and revenue are protected when dealing with academic institutions and vice versa due to the intellectual property implications of federally funded academic research. Likewise, federal agencies and their regulations can be a morass of confusing rules. From FDA and EMA to HIPAA and GDPR, having an intellectual property attorney who also deals with federal and foreign or international regulations can save much time and investment down the road.
In medicine, innovation is the name of the game. Your innovative products, procedures, and processes must be protected in every sense of the word. When considering an attorney and legal staff, it’s always best to know that they understand your business. If your attorney understands they are representing the best interests of your consumers, providers, and yes, even the regulators, then you are way ahead of the pack. Your innovations deserve top-notch legal counsel so press your attorneys on their knowledge and ability to mitigate issues before they even arise.
If you have questions about intellectual property as it pertains to healthcare situations, please contact us."
| |
|
This is an attorney advertisement. Your receipt and/or use of this material does not constitute or create an attorney-client relationship between you and Spilman Thomas & Battle, PLLC or any attorney associated with the firm. This e-mail publication is distributed with the understanding that the author, publisher and distributor are not rendering legal or other professional advice on specific facts or matters and, accordingly, assume no liability whatsoever in connection with its use.
Responsible Attorney: Michael J. Basile, 800-967-8251
| | | | |
