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Pending Oregon Law Undermines Traditional Physician Practice Structure

In an apparent attempt to shield physician practices from perceived abuses of close association with physician practice management (PPM) companies, a pending Oregon law could undermine a broad range of structures and transactions between physicians and laypersons, including loans, real estate leases, practice sales, national virtual care platforms, investor sponsored practice roll-ups and payor-provider joint ventures.

Oregon House Bill 4130 prohibits several relationships and control structures which would materially constrain the typical PPM structure utilized by hospitals, private equity sponsors, virtual care providers, managed care companies and others to create a more integrated approach to care delivery, to take advantage of efficiencies and, in many instances, simply to operate.

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CMS Approves New York 1115 Medicaid Redesign Waiver

On January 9, 2024, the Centers for Medicare and Medicaid Services (CMS) approved the New York State (NY) 1115 Medicaid waiver “Medicaid Redesign Team” (MRT). The MRT is a long-standing waiver in NY that has continuously evolved to improve the administration, structure and financing of the NY Medicaid program; enhance Medicaid beneficiaries’ access to services; and improve health outcomes across the state. The recently approved waiver represents the next step in Medicaid redesign in NY and builds on the previous Delivery System Reform Incentive Payment (DSRIP) program.

This article reviews the major initiatives included in the MRT, components of the MRT that were excluded from the approval, implications for stakeholders and more.

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Gender-Affirming Benefits: Best Practices for Group Health Plans

Group health plan sponsors, third-party administrators and other health plan service providers must navigate a shifting legal landscape as they determine how to offer gender-affirming benefits, including whether − and to what extent − group health plans must cover gender-affirming medical or surgical treatments, especially regarding minors. In this On the Subject, we discuss recent legal developments impacting gender-affirming care and approaches to group health plan coverage.

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New Proposed Rules Aim to Enhance Healthcare Accessibility for People With Disabilities

The US Department of Health and Human Services and the US Department of Justice recently published new proposed rules that update and create various requirements under Section 504 of the Rehabilitation Act of 1973 and Title II of the Americans with Disabilities Act of 1990. What are some of the biggest changes?

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The MHPAEA Proposed Rule: ‘Meaningful Benefits’ and the ‘Scope of Services’

This post continues our consideration of comments submitted in response to proposed regulations under the Mental Health Parity and Addiction Equity Act (MHPAEA). Our previous MHPAEA content is available here.

Under current law, if a plan provides any mental health or substance use disorder (MH/SUD) benefits in any classification of benefits, benefits for that condition or use disorder must be provided in every classification in which medical/surgical (M/S) benefits are provided. Classifications for this purpose include inpatient, in-network; inpatient, out-of-network; outpatient, in-network; outpatient, out-of-network; emergency care; and prescription drugs. The proposed regulations modify this standard by providing that a plan does not provide benefits for MH/SUD benefits in every classification in which M/S benefits are provided unless the plan provides meaningful benefits for treatment for the condition or disorder in each such classification “as determined in comparison to the benefits provided for medical/surgical conditions in the classification.”

The term “meaningful benefits” is nowhere defined. The regulators nevertheless “recognize that the proposal to require meaningful benefits [ ] is related to scope of services.” “Scope of services” for this purpose generally refers to the types of treatments and treatment settings that are covered by a group health plan or health insurance issuer. The preamble to the proposed regulation invites comments on how the meaningful benefits requirement “would interact with the approach related to scope of services adopted under the 2013 final regulations.” The preamble of the 2013 final regulations addressed an issue characterized as ‘‘scope of services’’ or ‘‘continuum of care’’ but otherwise failed to provide any substance. Two examples from the proposed regulations do, however, give us a sense of what the regulators have in mind.

  • A plan that generally covers treatment for autism spectrum disorder (ASD), a mental health condition, and covers outpatient, out-of-network developmental evaluations for ASD but excludes all other benefits for outpatient treatment for ASD, including applied behavior analysis (ABA) therapy, when provided on an out-of-network basis. (ABA therapy is one of the primary treatments for ASD in children.) The plan generally covers the full range of outpatient treatments and treatment settings for M/S conditions and procedures when provided on an out-of-network basis. The plan in this example violates the applicable parity standards.
  • In another example, a plan generally covers diagnosis and treatment for eating disorders, a mental health condition, but specifically excludes coverage for nutrition counseling to treat eating disorders, including in the outpatient, in-network classification. Nutrition counseling is one of the primary treatments for eating disorders. The plan generally provides benefits for the primary treatments for medical conditions and surgical procedures in the outpatient, in-network classification. The exclusion of coverage for nutrition counseling for eating disorders results in the plan failing to provide meaningful benefits for the treatment of eating disorders in the outpatient, in-network classification, as determined in comparison to the benefits provided for M/S conditions in the classification. Therefore, the plan violates the proposed rules.

Notably, the newly proposed meaningful benefits requirement is separate from, [...]

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2024: The Year of the Telehealth Cliff

What does December 31, 2024, mean to you? New Year’s Eve? Post-2024 election? Too far away to know?

Our answer: December 31, 2024, is when we will go over a “telehealth cliff” if Congress fails to act before that date, directly impacting care and access for Medicare beneficiaries. What is this telehealth cliff?

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The MHPAEA Proposed Rule: Standards of Care and Medical Necessity

Comments submitted in response to the proposed regulations under the Mental Health Parity and Addiction Equity Act (MHPAEA) reflect a broad range of perspectives. Our previous MHPAEA content is available here.

A nontrivial subset of the comments single out a particular nonqualified treatment limitation (NQTL) for special treatment or scrutiny. An example of this trend is found in an October 16, 2023, comment letter submitted by the Legal Action Center. The letter asks the US Departments of Labor, Health and Human Services, and the Treasury (the Departments) to address the rule’s treatment of medical standards of care and medical necessity.

Under the 2013 final MHPAEA regulations, a plan or issuer may not impose an NQTL with respect to mental health/substance use disorder (MH/SUD) benefits in any classification unless the processes, strategies, evidentiary standards or other factors used in applying the NQTL in the classification are comparable to, and are applied no more stringently than, the processes, strategies, evidentiary standards or other factors used in applying the limitation with respect to medical/surgical (M/S) benefits. (Classifications for this purpose include inpatient, in-network; inpatient, out-of-network; outpatient, in-network; outpatient, out-of-network; emergency care; and prescription drugs.)

The proposed regulation defines “strategies” as “practices, methods, or internal metrics that a plan or issuer considers, reviews, or uses to design an NQTL.” Compliance with and deviations from generally accepted standards of care are cited as examples. Strategies for this purpose include “the development of the clinical rationale used in approving or denying benefits,” which is the central purpose of medical necessity determinations.

Medical necessity criteria are considered NQTLs because the criteria have the capacity to limit a patient’s access to or duration of MH/SUD treatment that are not based on the frequency of treatment, number of visits, days of coverage or days in a waiting period (the latter are quantitative treatment limitations). The Legal Action Center claims that plans sometimes develop their own criteria for determining medical necessity for MH/SUD treatment or use criteria developed by nonprofit clinical specialty associations or industry entities, despite the law’s admonition that plans must treat the two comparably. Concerned that under the proposed regulation plans retain significant discretion to adopt overly restrictive medical necessity criteria, the Legal Action Center asks the Departments to revise the definition of “strategies” to include a definition of “generally accepted standards of care” that is tied to criteria and guidelines from the nonprofit clinical association for the relevant specialty.

One way to determine the quality of a medical necessity definition is to look at claims data, which offer a useful test of parity compliance. Current law does not require parity of outcomes, but the proposed regulation does. The proposed rule would require that plans collect and evaluate outcomes data for the express purpose of assessing the impact of the NQTL on access to MH/SUD benefits. Material differences in outcomes are viewed as a strong indicator of noncompliance. (For the network composition NQTL, a material difference in outcomes data [...]

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