Federal lawmakers are scrutinizing private equity firms they believe are major culprits of surprise medical bills. In 2019, the House Energy and Commerce Committee launched a bipartisan investigation last year into private equity firms’ role in surprise billing.  During this investigation, Committee leaders contacted the leaders of major private equity firms (including Blackstone Group, KKR and Welsh, Carson, Anderson & Stowe) to obtain information and documents surrounding their ownership of physician staffing and emergency transportation companies.  Committee leaders said that Blackstone had sought to acquire the emergency department staffing firm EmCare and KKR was seeking to acquire the physician staffing
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In November 2019, the United States filed a complaint against Sioux Falls, South Dakota, neurosurgeon Wilson Asfora M.D., Medical Designs LLC, and Sicage LLC alleging False Claims Act violations arising from the alleged payment of kickbacks to Asfora linked to the devices he used in spinal surgeries. Medical Designs LLC and Sicage LLC are medical device distributorships in South Dakota owned and operated by Asfora. Such entities are also known as “physician-owned distributorships” or “PODs”. This lawsuit follows a recent $20.45 million settlement between the government and the hospitals where Asfora performed such surgeries, Sanford Medical Center and the Sanford
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On September 13, 2019, a Pennsylvania judge dismissed a lawsuit brought by Liberty Mutual Insurance Companies against nine (9) pharmacies and their minority physician owners over allegations that the physicians were receiving unlawful kickbacks when they prescribed compounded cream medications to workers’ compensation program beneficiaries, which prescriptions were filled by pharmacies in which the physicians held minority ownership interests. The Philadelphia Court of Common Pleas granted summary judgment to the pharmacies in Liberty Mutual Group, et.al. v. 700 Pharmacy, LLC, et.al., finding that the plaintiffs failed to show that the pharmacies’ ownership structure or the physicians’ “self-referrals” were unlawful. The
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An administrative law judge (“ALJ”) recently ruled that the University of Texas MD Anderson Cancer Center (“MD Anderson”) in Houston must pay a $4.3 million fine to HHS Office of Civil Rights (“OCR”) for HIPAA data privacy and security violations. It is the fourth largest HIPAA-related settlement ever paid to the OCR. The ALJ fines included daily fines for MD Anderson’s non-compliance over a 22-month period and annual fines of $1.5 million for each of two calendar years. With respect to the $4.3 million penalty, the ALJ noted that MD Anderson is a “multi-billion dollar per year business” and “remedies
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The Office of the Inspector General (“OIG”) at the U.S. Office of Personnel Management (“OPM”) alleged in a report dated February 12, 2018 that Health Net of California (“Health Net”) obstructed a federal IT audit, thereby violating its contract with the OPM. In the report, OIG refers to Health Net’s refusal to comply with the planned testing as “unprecedented”. The report further states that Health Net, on February 7, 2018, responded to a formal request from OPM, indicating that it would not provide the requested documentation, nor would it allow the agency to conduct testing. OPM stated that Health Net’s
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The recent enactment of the Tax Cuts and Jobs Act (the “Act”) represents the most sweeping reform of tax laws in over 30 years. It also represents, by far, the most significant legislative accomplishment of the Trump administration in 2017. The following paragraphs highlight the Act’s impact on the healthcare industry: 1. Starting in 2019, the Act repeals the Obamacare “individual mandate” that requires all Americans under 65 to have health insurance or pay an annual penalty, $695 per person or 2.5 percent of income—whichever is higher. Per the Congressional Budget Office’s November 2017 analysis, “Repealing the Individual Health Insurance
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The U.S. Court of Appeals (8th Circuit) recently affirmed the grant of summary judgment by the District Court for the Western District of Arkansas to Johnson Regional Medical Center (“JRMC”) in a breach of contract action against Dr. Robert Halterman, a former employee physician.  Halterman was ordered to pay JRMC $64,931.81 in principal, interest, attorney fees, and additional costs for breaching a recruitment agreement (including an employment agreement and a promissory note) entered into with JRMC. JRMC and Halterman entered into a recruitment agreement in which JRMC provided Halterman with a $50,000.00 signing bonus, payable in monthly installments. The monthly
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