In this episode of AHLA's monthly series on fraud and abuse issues, Matthew Wetzel, Partner, Goodwin Procter, speaks to Laura Laemmle-Weidenfeld, Partner, Jones Day, about some of the significant changes that have taken place in health law enforcement over the past year. They discuss changes to the Stark Law and Anti-Kickback Statute safe harbor for personal services arrangements, challenges related to telemedicine fraud enforcement, and DOJ’s back-and-forth on the use of agency guidance documents in civil enforcement actions. Laura is the author of the recent supplement to the Fifth Edition of AHLA’s Legal Issues in Health Care Fraud and Abuse. From AHLA's Fraud and Abuse Practice Group. Sponsored by BRG.
To learn more about AHLA and the educational resources available to the health law community, visit americanhealthlaw.org.
In this episode of AHLA's monthly series on fraud and abuse issues, Matthew Wetzel, Partner, Goodwin Procter, speaks to Laura Laemmle-Weidenfeld, Partner, Jones Day, about some of the significant changes that have taken place in health law enforcement over the past year. They discuss changes to the Stark Law and Anti-Kickback Statute safe harbor for personal services arrangements, challenges related to telemedicine fraud enforcement, and DOJ’s back-and-forth on the use of agency guidance documents in civil enforcement actions. Laura is the author of the recent supplement to the Fifth Edition of AHLA’s Legal Issues in Health Care Fraud and Abuse. From AHLA's Fraud and Abuse Practice Group. Sponsored by BRG.
To learn more about AHLA and the educational resources available to the health law community, visit americanhealthlaw.org.
The following message and support for a H a is provided by Berkeley research group. A global consulting firm that held helps organizations advance in the areas of disputes and investigations, corporate finance, and strategy and operations BRG helps clients stay ahead of what's next for more information, visit think brg.com.
Speaker 2:Good morning. Good afternoon. Welcome to another edition of the American health law association for Auto's podcast. I'm your host, Matt at Wetzel today, we're talking with Laura Whedon Feld of Jones day. Laura represents healthcare and life sciences clients against federal and state fraud enforcement actions that provides compliance guidance. She has defended against numerous investigations and litigation brought by the department of justice, us attorney's offices, the HHS offices of inspector general state attorneys, general and other state and federal agencies. Previously, Laura served as a trial attorney in the fraud section of DOJs civil division, where she investigated and litigated healthcare fraud matters brought under the false claims act. She is also the author of the fifth edition of the legal issues and healthcare fraud and abuse text. Laura, welcome to the podcast. Um, you recently published the supplement to your, to the fifth edition of your book, uh, legal issues and healthcare fraud abuse. And we talked a few weeks ago. I had just received my copy. I have to say I've been referring to it. And, um, you know, it's a, it, it's good to kind of keep on the shelf and, and use is needed. What's the latest in the supplement, what should readers know and expect, um, when they get their copy?
Speaker 3:So the supplement focuses a significant portion on the 2020, the November, 2020 new final regulation from HHS OIG and from CMS on the, any kickback statute, safe Harbor and the stark law regs. So, um, it's certainly, that's one thing that may be helpful to focus on because we covered, if not every single tiny aspect of it, certainly the majority of the, of, of the significant points in the regs. And so, you know, I know that when they first came out, a lot of people scurried and scrambled and tried to read them all. And there was just so much that, you know, I, I suspect a lot of people had great intentions of getting through it all and got stuck at some point because actual, you know, client work pulled them off and then they may not have, have ever come back to it. So, um, or they read it then, and now they can't remember really what's in it. So, um, I think it should be useful for that, but then also we just provide kind of an overview of things that have been going on and what's been happening. And, you know, as of that point, now I'm already supposed to be working on the new update. I've got materials that I'm supposed to be going through to start, um, preparing the new update, which, which I will then submit to HLA and around, uh, what, like, I think March of this year. So it, it is an ongoing process of updating this. So, you know, it, it's not like the, the one supplement is the be all and end all there will be one each year, but I think that's probably what's most significant in last year's, uh,
Speaker 2:Update. Well, certainly, I mean, you know, talk about sweeping changes to the longstanding regulatory regime and, um, you know, provided us all, uh, how health, health law nerds with a little excitement last year, um, during the middle of COVID, um, you know, the, the, the regulatory sprint, or maybe, you know, slow stroll to coordinated care, um, you know, has, has resulted in those, those sweeping changes. And, you know, one question that I think about, you know, a year in here is how are clients reacting to those changes? And, you know, what's sort of top of mind for them when it comes to, you know, the value based arrangements, uh, safe harbors, the, you know, the, the patient engagement tools, safe, harbors, the changes to, you know, the EHR safe Harbor, cetera, you know, what, what, what are, what are folks saying?
Speaker 3:So my perspective may be a little bit skewed because I come at these issues primarily when there's primarily when there's a potential problem, when somebody says, oh my goodness, I think maybe we were doing this wrong. Um, whether it's somebody internally or whether it's in the part of a due diligence. Um, I also, sometimes I do get pulled in when clients wanna make changes, but then I usually pull in my colleagues who focus more on, on structuring arrangements as opposed to identifying potential problems or fixing problems or helping self report problems. Uh, so I think I pro I probably have not seen as much as maybe some of my colleagues who do more of that structuring. Um, I certainly have seen clients take a look at and think about, oh, well, how could this impact us, or how could we use these new provisions? Um, but I personally, haven't seen a lot of sweeping of, oh my goodness. Now that we've got all this new latitude, we can do all these new things, but that may be largely just because that's not the area of, of my practice really. Mm-hmm,<affirmative>, I'm, I'm hoping that that other practitioners who do more of the transactional kind of work are, um, or, you know, structuring for position compensation programs, all that kind of thing. I'm hoping that they're seeing more changes. And I do know that they're just from talking with colleagues that there's, you know, certainly a lot more going on in, you know, the ACO world. And, um, and, and in, in that world of, of, you know, of integration between physicians and, and health systems and that sort of thing, it's just not quite the world that I usually live in until there are problems
Speaker 2:Well said. And, um, you know, as you think about those, um, up updates from November that, um, are so well described in the supplement, what are some that stand out to you as, you know, sort of really pivotal changes? You know, we saw some that were, you know, kind of updates and, you know, adjustments to account for changes in the healthcare delivery models, um, that are currently out there. Then we saw some that were just kinda, you know, overhauls. What, what stood out to you?
Speaker 3:The one change that I think has that I have come back to again and again, and again, is the change in the safe, in the, the kickback statute, safe Harbor for personal services arrangements. It used to be that the aggregate compensation had to be set in, in advance, and that was virtually impossible for anyone that I worked with to meet. Um, I occasionally it was possible, but really not so much. And then if you could set it in aggregate, you weren't really sure it was gonna be fair market value was the problem. So it was sort of a catch 22, and that prevented so many arrangement from being able to be structured within the safe Harbor, with the changes no longer requiring the aggregate comp to be set in advance, but just the methodology to be set in advance. Um, although it still cannot take into account value or volume that has enabled a lot more arrangements to be able to fit within the safe Harbor. So it's gone from, you know, a year and a half ago when we would be counseling. When I would be working with clients who were had identified, you know, were, were a little bit nervous about how to set something up, they would, you know, we would say, well, you're not gonna be able to fit this in the safe Harbor, but here's what you can do to be closest to it because it just wouldn't be feasible. And now we can actually talk again about structuring things within the safe Harbor. So I would say that is the number one biggest biggest change. Um, and then in, in the stark loss, some of the provisions about, um, I, I think the one thing that stands out to me that we've been able to look at a lot is the provision about, um, for reconciliation of payments, where if you discover within a term, or I think it's within 90 days, don't hold me to that. Cause I might be wrong in the number of days. I always double check. Um, but, but that, that you can, you can go back and, and make sure that the payments actually lined up with what was supposed to happen, um, and bring it into compliance that way, um, which really makes so much sense in real life. Mm-hmm<affirmative> that has also, I think, been a significant game changer in, um, you know, being able to, to fix problems, be fix issues before they become problems.
Speaker 2:Yeah. I, I couldn't agree more. I think the practical, um, updates, the practical, uh, you know, impact of those changes, the warranties safe Harbor revisions, you know, there's a couple in there where it just seems to be, you know, better aligned with, you know, a more realistic, um, a more realistic practice. Um, you've been writing and speaking recently about telemedicine fraud of, we could just kind of pivot a little bit, um, what are some of the concepts that are most interesting to you there and, you know, what do you see as sort of the top concerns, um, when it comes to telemedicine, telehealth expanded coverage, we might see coming out of the, you know, the public health emergency, et cetera.
Speaker 3:Yeah. So in tele health, I think the biggest challenge broadly is uncertainty. The uncertainty of knowing what the rules are gonna be tomorrow. Um, the potential uncertainty by any given provider is to what the actual rules are for that provider, um, is really hard to keep track of all of, of, with all of the changes from the federal government, primarily in Medicare. And then also a lot of changes by all the state governments, um, with re with respect to Medicaid, but also just with respect to what the state rules are for practice and, and you know, what the requirements are for, you know, that are set by the medical boards, keeping track of all of that, especially for a provider that practices across states is incredibly challenging. And I think there's a lot of uncertain well, so it's challenging for, for any given provider to stay on top of all of that, with respect to the states in which its physicians are practiced, seeing physicians or other, you know, sometimes advanced you knows, um, and P and PAs, but also then, so they need to know the rules. They need to make sure that their billers know the rules. And so that's always making sure that there's a real trickle down to the billers and that they know the rules can be incredibly challenging. Um, and then there so much uncertainty about, well, what's Congress gonna do what's CMS gonna do CMS has done as much as they can, maybe then they need Congress to act, is Congress really gonna act or not? Um, and so that remains a big challenge for planning purposes as well as for compliance purposes. Um, and so I think I would like to, to see Congress expand more and basically get telehealth to where it needs to be for regular, everyday people to be able to access it in a, in a useful way, and then lock it down so that we don't have this continuous, well, this is what happened last month. What's on the horizon for the next couple of months, what's gonna happen next year, cuz that just creates chaos and when there's uncertainty and um, and at the same time, people are actually trying to practice medicine and trying to give good care in a pandemic it's to the extent that we can eliminate change and flux and uncertainty, that would be most helpful for everyone. And I think that's a big challenge. Other challenges are that, um, in more than the enforcement area there, the federal, there there's a of views by some of the agencies. I think, I think DOJ sees these criminal cases where cases they're bringing cases in which somebody decides they wanna commit fraud. And there's a good way to do it, to build, you know, build the system out of a whole bunch of money by using tele healthcare, first of all, and then telehealth. And so you've got real fraudsters who are out there, you know, scamming pat scamming, individual patients, beneficiaries who may not, may not be, you know, may be suffering from loneliness, dementia, all sorts of other things that may than particularly susceptible to being taken advantage of mm-hmm<affirmative> um, and then you've got, you know, some tele frauds who are using that to then figure out a way to, um, work with some telemedicine companies or, um, and, or align themselves with DME suppliers and or with, um, pharmacies that are C compounding and also with, you know, genetic testing lab in order to figure out a way to order a whole bunch of medically unnecessary things and skim money off of that entire process. Um, you know, that's not at all what real telehealth is about. That's not at all what real telehealth providers are doing, what any of our clients are trying to do, but because those are the extreme examples and, and OIG has referred to that as tele fraud. And DOJ has picked up on that lingo a little bit, but what you see the most colors, the way that you see the world. And so DOJ is seeing these really bad criminal situations with frauds taking advantage of telehealth in order to commit their frauds and thinking that's telemedicine, that's what telehealth is. And so there's all of this risk all over it, which is really unfair and, and untrue. Um, OIG, I think takes a much more nuanced view of it, at least based on the public statements and, and people that I've talked to seems to take a much more nuanced view where they recognize telehealth really is, has been necessary, has filled the need, is helping reach patients, beneficiaries who otherwise just don't have access to care. And it is providing access to care for them that they otherwise wouldn't have. It's not a question of, even for them, is it necessarily the, you know, the best access, the gold standard it's they went from having none to now having good care. And I think OIG recognizes that a lot more and recognizes the need to continue providing access while also recognizing of course there's the possibility of fraud, but there's the possibility of fraud in bricks and mortar. OIGs been dealing with that for years and years and years and years. And you know what those three areas that I ticked off in telemedicine, the genetic, you know, genetic testing D me and compounding pharmacies, those have been at the heart of a number of bricks and mortars investigations for years, not so many years for genetic testing, cuz they haven't been doing it for as long, but there's been all sorts of issues relating to those three in bricks and mortar. So I think it's in. So I think that, um, the other, the other risk there is that do J is seeing well, you know, in, in telehealth of patient, the doctor, sometimes doesn't even talk to the patient, may just get asynchronous information about the patient and make some decisions. And that's used in tele fraud, therefore that's sort of per se illegal, right? I mean that's fraud. Nobody would do that and really be providing care. That's just not true either. So I think there's a big information gap. Mm-hmm<affirmative> between what DOJ knows about telehealth, cuz they're not in the, they're not dealing with it day in and day out. I'm not blaming you, you know what you see. Um, but there's a big information gap. And I think for, right right now for telemedicine providers, we're going to see a lot more civil fraud actions that are not these extreme tele fraud cases, but we're gonna see a lot more, quans being brought by telemedicine and they're going to need to even more than in a normal investigation, inform DOJ of how it really works. And, and why, why would they're doing really is not problematic and why this is not one of those terrible criminal cases, but it's gonna be an uphill battle because, um, DOJ is gonna has some preconceived notions about how medicine should be provided and they're frankly, a few years behind the curve. So I think that's gonna be a big challenge too.
Speaker 2:Yeah. And maybe, um, the idea is, you know, from do O J's perspective, um, you know, we see this potential for expanded Medicare coverage of telemedicine or telehealth. That means there's only gonna be more instances of, um, tele fraud versus, you know, the OIG sort of more nuanced view being closer to it. Uh, but also the idea that with any good tool comes both users and abusers. And um, and, and, and hear what we've seen is this sort of higher profile instance, these higher profile instances of abuse that are coloring the, the DOJs view.
Speaker 3:Exactly, exactly.
Speaker 2:Speaking of DOJ. So, uh, you know, another chain over the past year has been the, you know, administration at the DOJ and, uh, you know, your own background as a former DOJ, uh, uh, prosecutor and, and lawyer. Um, you know, I'd love your take on sort of that, you know, what's becoming now kind of every four years, the shift from, you know, the old policies on individual liability and rela you know, reliance on agency guidance and, and that, uh, you know, we're gonna, we're gonna pursue individuals. We're going to not allow use of agency guidance to the, you know, the flip back and, you know, what's your view on that where it's sort of currently landed and, and, um, how that affects your, you know, your practice with your clients.
Speaker 3:Sure. So with respect to the, um, the agency guidance. So under the prior administration, under the Trump administration, the, um, the, the so-called brand memo by Rachel brand, who at that point was very high up in the, in the department, um, that had stated that the DOJ could not rely for its affirmative cases, which would be like false claims act cases, um, could not rely for in affirmative cases on a mere guidance subregulatory guidance that an issued by any agency in order to bring, you know, to bring those cases, the significance of that. Well, it, yes, it did have some significance because it did mean that DOJ wouldn't be able to, you know, if there was something in the, the Medicare provider manual that said, you, you must do a, and an entity didn't do a, that alone could not be the predicate for a fraud case under the false claims act. But as a practical matter, there weren't that many of those cases being brought where they were focusing just on some subregulatory thing that in my experience, um, the government has virtually always tied those to a regulatory provision, a Stephen, a statute. And so I think that, I think maybe there was a little bit more hype around that than was necessarily really warranted mm-hmm<affirmative> certainly, it was an important principle that you, you gotta have some notice and comment process in order to have a clear rule for the government to prosecute fraud under that clear rule. But, and, and that principle is very important, but I'm not sure that the, the memo really changed that all that much. I didn't see any cases suddenly. Maybe I missed some, but I didn't see any suddenly getting dropped because of that memo or, and I can't think of a case that I've handled at all in my career that would not have been brought if that memo had been in existence. Um, I'm sure there's some around the fringes, but it, it did not substantively changed. I think it was more reflective of a difference in approach, a difference in the prior administration wanting to say, look, we only pursue fraud when it's clear fraud, and you gotta be able to point to something that the person knew or should have known they were violating. And, and so I think there's been the, that has since been rescinded. Um, it was rescinded recently by the Biden administration. And again, I don't think that's gonna dramatically change the actual cases that DOJ is bringing or that they're in intervening in, or that they're gonna be declining on personally. So I, I know some of my colleagues probably disagree with me on that, but that's my personal sense. What I'm concerned about though, is that the pendulum is shifting more away from the idea that there's gotta be a clear violation if you're gonna be claiming fraud to, well, some of the gray stuff, if it's gray, you, you should have been able to figure your way out of that gray into a black and white landscape and as a practical matter, that just isn't always possible. And so I'm concerned that we're gonna be seeing even more cases being brought than perhaps out over the last couple years. And it's sort of hard, you know, the, the pandemic was kind of that final year of past administration. So<laugh> the, the last few years have just been weird in terms of predicting what's gonna happen and talking about what has happened, but I'm, I would be concerned if we see an uptick in fraud cases being brought where the rules of the road were not clear and whether something was a violation, it simply wasn't clear. I, I think it's problematic to try to call something fraud. If it was hard to know what the real rules were.
Speaker 2:Mm-hmm<affirmative>, mm-hmm,<affirmative> absolutely. Absolutely. While you mentioned the word predictions, it is December and I, I always ask people, uh, who are experts in their fields? What do you think's gonna happen next year? So, you know, would love your prognostications on 2022. I know everybody's favorite question. Um, and you know, really focusing on kind of the healthcare fraud and abuse space. So maybe legislative developments, regulatory developments, you know, change in the enforcement environment, as we've talked about a little bit, what do you think is gonna happen in 2022?
Speaker 3:So with all the caveats that is really hard to predict, particularly in a pandemic yes. As to what's gonna happen. Um, I think we are going to see an uptick in enforcement matters, um, as people, although the pandemic isn't over by any means, I think people are trying to get back to normal in terms of the work that they're doing and how much work they're doing and, and those sorts of things. And they're just getting more accustom to the extent that things aren't gonna change back to the way they were. People are just getting accustomed to how, how they are. So I think we're probably gonna see a continued refocusing on what were, you know, on people's actual work. And I think we're probably gonna see more whistleblower cases being brought, maybe even a catch up process of, oh, we lost all this ground. We fell behind on, you know, from later council, we fell behind on, on putting together complaints. Let's, let's get with that and let's get these on file. Um, you know, I think that DOJ is probably gonna be a, a bit more reinvigorated, um, with, with investigating the cases, not that they ever went away or went to they didn't. So I, I think we will see an uptick, especially with, with this administration being much more focused on, um, on anti fraud and we're, you know, seeing more focus on anti-corruption. Yep. Yeah. So I, I think we're gonna be seeing more enforcement. What I'm the real question I think, is to what extent is gonna focus on sort of the traditional big players, or to what extent are we gonna see more enforcement on, you know, small players and, you know, individuals and that sort of thing I've heard through the rumor mill and these aren't generally cases that come to us at, at Jones day, but I've heard through the rumor mill from practitioners who, who practice more with, you know, with visual individual physician practices or very, very small physician practices, especially in rural communities that they're seeing more enforcement again, being brought against them much more aggressively than they're used to seeing. And obviously I sort of hear one side of it<laugh> it sounds like maybe more aggressively than as necessarily appropriate in a lot of those cases. And more aggressively then would be brought against a larger provider. Who's known to have greater resources to fight back. Uh, I hope that that's not a real trend, but, and, and I would be very concerned if that's a trend that grows, uh, not that I want anybody picking on, on the larger clients either, um, you know, to, to the extent of being inappropriate, but, um, it's particularly concerning. I think if, if sort of smaller providers that don't have the wherewithal to fight back are being bullied. Um, and I, so I hope that that's not going to be an actual trend. Um, but I do think just
Speaker 2:Who may be doing what they can with the limited resources that they have at their disposal.
Speaker 3:Right, right, right. There's right. There's certainly an, an element of that as well. And again, particularly during the pandemic, when there's a lot going on, we've, you know, some as lawyers, I think we've, we've sort of gotten used to it, to dealing with that change in our day to day lives and how much it really impacts us anymore, you know, for of us, not that much, I'm sure for some people it still does, but for a lot of us, we've just learned to adapt, but for physicians and other healthcare providers, they're still dealing with that as a, that as a reality, and the patients that they're treating, as well as all the other overlays that the rest of us are dealing with. Um, and I, you know, I hope that we, that enforce or just don't forget that
Speaker 2:Very well said very well said, well, there's two things that stand out about the legal issues book and, you know, first I know it's an accumulation of sort of years of work and, and, you know, you're, um, you're, uh, uh, serving as the, you know, the captain of the ship. Um, really, it's just a great, um, it's almost like a great historical record of the development, healthcare fraud, abuse laws. And, you know, I do appreciate the sort of underpinnings of it and the, you know, the policy discussions, the, the history of it. Um, it brings me to my last question. So the social was first amended in 1972 to include the kickback laws. What are we gonna do for the 50th anniversary of the anti<laugh>?
Speaker 3:I don't know. I don't know. Um, I you'll, I think you'll need to ask OIG what they're, what they're planning on doing. Um, I, and, you know, maybe age a, has some, has some grand plans, um, you know, I think for the, for the, for the anniversary of the, um, the false claims act, there were some plans that, that I think maybe got a little bit derailed due to do the pandemic. Um, but I think it would be interesting to do some sort of panel with yeah. You know, some people who were involved long ago with the kickback statue, as it evolved and, and, you know, OIG sort of evolved at the same time as its own entity. So I think that would be an interesting thing to, to tap on and, and, you know, talk to some folks about that would be, would be fascinating. Um, but I do wanna say with respect to the book, as you said, it, um, it's been built on over the years. So it was started long ago. I wanna say back in the mid nineties, by David Mattias at, at Epstein Becker, he, and then he continued, um, I mean, that was putting it together in the first place. I can't even imagine how he managed to do that. What am monumental task? And then he, and many of his colleagues, Carrie Valent, and Jason, Chris, and Julie Downs, and I'm sure others, um, added onto it over the years. And then, you know, right now it currently the current fifth edition or whatever it is currently bears my name, but it would not be what it was, what it is, but for all of the efforts of those folks, and I'm sure it will continue on long after, after me, after I'm no longer involved in it. Um, not that I have have a deadline at this point at all, but I'm sure I hope that it will continue to be added on. And it, it is fascinating. I love going back and reading all of the old stuff, things that I wasn't, I, you know, I was just starting my practice around that time. So a lot of things I missed or didn't appreciate the significance of that were captured there at that time. Um, but I just, I just wanted to give a shout out to, to all of those folks who did so much work and, you know, their E the book would not be half of what it is today, but for their efforts.
Speaker 2:Well, it's a very nice analogy for how legal knowledge is just passed on through the generations of lawyers. And I also have really enjoyed reading, you know, some of the background and, and historical, uh, concepts. Again, I'm a little bit of a health law nerd myself. So I, I, I appreciate it, but Laura, it's been such a pleasure, pleasure chatting with you today and, um, really appreciate your, uh, joining us here. And Laura, thanks so much for the time. Thanks so much for having me, Matt. I appreciate it. And thank you to our listeners. This has been another addition of the American health law Association's podcast. I'm your host, Matt Wetzel and return next month with another episode.
Speaker 4:Thank you for listening. If you enjoy this episode, be sure to subscribe to a H L a speaking of health law, wherever you get your podcasts to learn more about ALA and the educational resources available to the health law community, visit American health law.org.