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In a preliminary injunction issued on Tuesday, November 30, 2021, a federal judge in Louisiana temporarily blocked the implementation and enforcement of an interim final rule by the Centers for Medicare & Medicaid Services (CMS) that would require employees of Medicare and Medicaid certified health care providers and suppliers to have an initial COVID vaccine by December 6, 2021 and be fully vaccinated by January 4, 2022.

The Court chose to issue a nationwide injunction that will apply in all states, with the exception of 10 states already subject to a preliminary injunction issued on November 29, 2021 – Alaska, Arkansas, Iowa, Kansas, Missouri, Nebraska, New Hampshire, North Dakota, South Dakota and Wyoming – by the U.S. District Court in Missouri.

The 34-page order by U.S. District Judge Terry A. Doughtry temporarily blocks the vaccine mandate, as well as the CMS requirements that providers have in place certain policies and procedures related to documenting vaccinations, providing medical and religious exemptions from the vaccination requirement, and identifying and implementing accommodations for employees who are not fully vaccinated.

Background

On November 5, 2021, CMS published the Omnibus COVID-19 Health Care Staff Vaccination Interim Final Rule, requiring vaccination of all employees at health care facilities that participate in the Medicare and Medicaid programs, regardless of responsibility or patient contact.

The states of Louisiana, Montana, Arizona, Alabama, Georgia, Idaho, Indiana, Mississippi, Oklahoma, South Carolina, Utah, West Virginia, Kentucky and Ohio filed suit in the U.S. District Court for the Western District of Louisiana and requested a preliminary injunction to temporarily block the implementation of the CMS mandate.

Injunction Order

In his memorandum and order, Judge Doughtry detailed the basis for his decision to issue an injunction, and he found that the plaintiff states were likely to succeed on their claims that:

  • The CMS vaccine mandate caused “particularized and concrete” injuries including alleged loss of jobs, business, and tax revenue.
  • CMS was required to provide a 30-day “notice and comment period” before implementing the CMS vaccine mandate unless CMS could show good cause for avoiding this requirement. Good cause was not demonstrated in this case.
  • The mandate has “vast economic and political significance” and CMS exceeded its authority in enacting the CMS Mandate.
  • The mandate was contrary to law and arbitrary and capricious.
  • The mandate would cause irreparable harm including:
    • depriving the states of a procedural right to protect their interests
    • depriving the states of a right to enforce their laws and requiring them to incur the costs of training on and enforcing the CMS Mandate and having their police power encroached
    • placing a burden on the liberty interest of the states’ citizens requiring them to choose between losing their jobs or taking the vaccine
    • burdening health care facilities and suppliers by requiring them to comply with the vaccine mandate or lose Medicare and Medicaid funding

Ultimately, Judge Doughtry determined the threatened harm of the CMS vaccine mandate outweighs any harm that may result if it is not implemented, and that the public interest is served by maintaining the current constitutional structure and maintaining the liberty of individuals who do not want to take the COVID-19 vaccine.

What’s Next?

If CMS appeals, the case will be heard by the U.S. Court of Appeals for the 5th Circuit – a court that has recently addressed COVID vaccine mandate issues in a different context. In BST Holdings, LLC v. OSHA, the 5th Circuit enjoined the OSHA vaccine mandate, which applied to all businesses with more than 100 employees. Judge Doughtry described the issues presented in BST Holdings as “almost identical” to the considerations presented in the pending case involving the CMS vaccine mandate.

The fate of the CMS vaccine mandate is still uncertain. However, it is clear that the courts will continue to be involved.

Stay tuned.

In a preliminary injunction issued on Monday, November 29, 2021, a federal judge in Missouri blocked the implementation and enforcement in 10 states of an interim final rule by the Centers for Medicare & Medicaid Services (CMS) that would require employees of Medicare and Medicaid certified health care providers and suppliers to have an initial COVID vaccine by December 6, 2021 and be fully vaccinated by January 4, 2022.

The 32-page order by U.S. District Court Judge Matthew T. Schelp applies only to Medicare and Medicaid certified providers and suppliers in Alaska, Arkansas, Iowa, Kansas, Missouri, Nebraska, New Hampshire, North Dakota, South Dakota and Wyoming.

In addition to blocking the vaccine mandate, the order also stays CMS requirements that providers have in place certain policies and procedures related to documenting vaccinations, providing medical and religious exemptions from the vaccination requirement, and accommodations for employees who are not fully vaccinated.

Background

As outlined in our prior alert, CMS on November 5, 2021 published the Omnibus COVID-19 Health Care Staff Vaccination Interim Final Rule, requiring vaccination of all employees at health care facilities that participate in the Medicare & Medicaid programs, regardless of responsibility or patient contact.

Just five days later, on November 10, the states of Alaska, Arkansas, Iowa, Kansas, Missouri, Nebraska, New Hampshire, North Dakota, South Dakota, and Wyoming filed a lawsuit challenging the CMS vaccine mandate and soon after requested a preliminary injunction.

Injunction Order

In his memorandum and order, Judge Schelp discussed the basis for his decision to issue an injunction:

  • Given the vast economic and political impact of the CMS vaccine mandate, CMS needed clear authorization from Congress before issuing such a mandate, which it did not have.
  • Even if CMS is authorized to mandate COVID-19 vaccination for health care workers, it could not lawfully do so without a notice and comment period before the effective date.
  • The plaintiff states established that they were likely to succeed with their claim that the CMS vaccine mandate was arbitrary and capricious.
  • The plaintiff states would be irreparably harmed if the vaccine mandate was not enjoined.
  • The alleged irreparable harms included:
    • inability of the states to enforce their own laws regarding vaccination mandates and proof of vaccination
    • exacerbation of already existing health care facility staffing shortages
    • significant economic harm, especially in rural areas where vaccination rates are relatively low

Judge Schelp also remarked that the status quo, without the vaccine mandate, is better than it was even a few months ago and is sufficient to protect the public’s interest in stopping the spread of COVID-19.

What’s Next?

If CMS appeals, the appeal will go to the U.S. Court of Appeals for the 8th Circuit.

The injunction in the Missouri case applies only to the 10 plaintiff states involved in the Missouri lawsuit and does not apply to the other 40 states. Three other challenges to the CMS vaccine mandate are pending in federal courts in Florida, Louisiana and Texas. The Florida court has previously declined to enjoin the enforcement of the CMS vaccine mandate.

The status of the CMS vaccine mandate in the remaining 40 states could change if other states join the Missouri lawsuit, if the courts in Louisiana and Texas decide to follow Judge Schelp’s ruling, or if CMS decides to take a different approach.

Stay tuned.

The Centers for Medicare & Medicaid Services (CMS) has published the Omnibus COVID-19 Health Care Staff Vaccination Interim Final Rule, requiring vaccination of all staff at health care facilities that participate in the Medicare & Medicaid programs, regardless of responsibility or patient contact.

The following summarizes who must abide by the regulations and what covered providers/suppliers need to complete by the Phase 1 deadline of Dec. 6, 2021, and Phase 2 deadline of January 4, 2022.

Who is covered by the Health Care Staff Vaccination Rules?

The rules cover current and new staff, including employees, licensed practitioners, students, trainees, volunteers and individuals who provide care, treatment or other services for the facility and/or its patients under contract or other arrangement, who are present at the following Medicare and Medicaid certified providers and suppliers:

  • Ambulatory surgery centers
  • Community mental health centers
  • Comprehensive outpatient rehabilitation facilities
  • Critical access hospitals
  • End-stage renal 2 disease facilities
  • Home health agencies
  • Home infusion therapy suppliers
  • Hospices
  • Hospitals
  • Intermediate care facilities for individuals with intellectual disabilities
  • Clinics
  • Rehabilitation agencies and public health agencies as providers of outpatient physical therapy and speech-language pathology services
  • Psychiatric residential treatment facilities
  • Programs for All-inclusive Care for the Elderly (PACE) organizations
  • Rural health clinics/federally qualified health centers
  • Long term care facilities, including skilled nursing facilities and nursing facilities

Who is NOT covered by the Health Care Staff Vaccination Rules?

(1) Staff who provide services 100% remotely for one of the entities listed above and have no direct contact with patients and other staff.

(2) Staff of the following providers/suppliers:

  • Religious nonmedical health care institutions
  • Organ procurement organizations
  • Portable x-ray suppliers

(3) Staff of facilities not subject to CMS health and safety regulations including:

  • Assisted living facilities,
  • Group homes
  • Medicaid home care and home- and community-based service providers

What Do You Need to Accomplish by December 6, 2021?

(1) Establish a process or policy to vaccinate all employees

  • ALL staff must be vaccinated or deemed exempt from vaccination requirements; there is no option to test unvaccinated staff.
  • If there is a state or local law prohibiting vaccine mandates, the facility/provider must follow CMS regulations pursuant to the Supremacy Clause of the U.S. Constitution

(2) Establish a process or policy by which staff may request a medical or religious exemption from the vaccine.

(3) Establish a process or policy to track and securely document vaccination status of each staff member, including those for whom there is a temporary delay in vaccination because of a recent receipt of monoclonal antibodies or convalescent plasma.

(4) Establish a process or policy ensuring the implementation of additional precautions to mitigate the transmission and spread of COVID-19 for all staff who are not fully vaccinated.

(5) Ensure staff at all health care facilities covered by the regulation have received, at a minimum, the first dose of a primary series COVID-19 vaccine (Pfizer or Moderna) or the single dose COVID-19 vaccine (Johnson & Johnson).

What Do You Need to Accomplish by January 4, 2022?

All applicable staff must be fully vaccinated for COVID-19, except staff who have been granted exemptions from COVID-19 vaccination or workers for whom COVID-19 vaccination must be temporarily delayed.

Staff will be deemed to have met the 60-day deadline if they receive the second/final dose of a primary vaccination series by the 60th day even though they will not be considered “fully vaccinated” until 14 days after the second dose.

Further details and analysis to follow. 

Fox Rothschild Partners William Maruca, Esq. and Catherine Wadhwani, Esq. recently recorded a podcast summarizing key points on physician hiring, especially considerations when hiring and contracting with foreign national physicians.  We invite you to listen: https://soundcloud.com/fox-rothschild-llp/physician-recruitment-podcast-episode-1 to the podcast and contact Mr. Maruca or Ms. Wadhwani, for further advice.

This post is a courtesy of Fox Rothschild attorneys Matthew D. Lee, Esq. and Marissa Koblitz Kingman, Esq., and was first published as an alert on Fox’s website.

The U.S. Justice Department’s COVID-related health care fraud crackdown continues to intensify. On a single day in September 2021, the Justice Department announced criminal charges against 138 defendants in 31 federal districts throughout the United States, alleging about $1.4 billion in losses. Among those charged are 42 doctors, nurses and other licensed medical professionals.

For businesses that took advantage of the $2.2 trillion in federal pandemic aid programs, this latest enforcement action demonstrates that an audit or investigation may be inevitable. Therefore, it is essential to ensure that compliance protocols are in place to avoid criminal consequences.

The CARES Act

The Coronavirus Aid, Relief, and Economic Security (CARES) Act, enacted in March 2020, provided emergency financial assistance in the form of forgivable loans to businesses to cover payroll and other specified expenses through the Paycheck Protection Program (PPP). It also included the Provider Relief Fund, which provided needed medical care to Americans suffering from COVID-19.

From the outset, the government vowed to ensure that it would take measures to prevent recipients from fraudulently taking advantage of the CARES Act programs.

Focus on Fraud in Health Care Sector

The Justice Department has been focused on COVID-19 health care related fraud since the pandemic’s inception. As Assistant Director Calvin Shivers of the FBI’s Criminal Investigative Division recently stated, “health care fraud targets the vulnerable in our communities, our health care system, and our basic expectation of competent, available care. Despite a continued pandemic, the FBI and our law enforcement partners remain dedicated to safeguarding American taxpayers and businesses from the steep cost of health care fraud.”

A coalition of federal and state law enforcement agencies are working together to investigate and prosecute alleged COVID-19 related fraud. The agencies include the Department of Health and Human Services Office of Inspector General, the FBI, the Drug Enforcement Administration, the Health Care Fraud Unit of the Criminal Division’s Fraud Section, the Health Care Fraud and Appalachian Regional Prescription Opioid Strike Force and the U.S. Attorneys’ Offices throughout the country.

Recent COVID-Related Criminal Charges

Recent criminal charges associated with the COVID-19 pandemic include a variety of allegations related to false billings. The defendants are alleged to have misused patient information to submit claims to Medicare for unrelated, medically unnecessary, and expensive laboratory tests, including cancer genetic testing.

Individual defendants are also alleged to have misused Provider Relief Fund monies for their own personal expenses, including for gambling at a Las Vegas casino and payments to a luxury car dealership.

Other recent charges include individuals accused of telemedicine fraud. In 11 judicial districts, charges have been filed against 43 defendants who allegedly paid doctors and nurse practitioners to order unnecessary durable medical equipment, genetic and other diagnostic testing, and pain medications, either without any patient interaction or with only a brief telephonic conversation with patients they had never met or seen.

Durable medical equipment companies, genetic testing laboratories and pharmacies then purchased those orders in exchange for illegal kickbacks and bribes. Prosecutors allege they also submitted more than $1.1 billion in false and fraudulent claims to Medicare and other government insurers. The claims included sham telehealth consultations that did not occur. The proceeds of the scheme were allegedly spent on luxury items, including vehicles, yachts, and real estate.

Criminal charges also included allegations that the defendants made false and fraudulent claims for tests and treatments for patients seeking treatment for drug and/or alcohol addiction through a national sober homes initiative program. Other medical professionals have been charged with over-proscribing millions of doses of opioids and other prescription narcotics and submitting false billings.

What to Expect Next

The federal government will soon make available an additional $25.5 billion for health care providers affected by the pandemic, including $8.5 billion allocated to the American Rescue Plan for providers who serve rural Medicaid, Children’s Health Insurance Program or Medicare patients, and $17 billion to the Provider Relief Fund.

The federal government’s estimate of $1.4 billion in alleged fraud losses to date underscores why its enforcement efforts are rapidly intensifying. Health care professionals and business owners should proceed with caution when taking advantage of the latest round of aid funding.

The recent spate of charges shows that even health care fraud unrelated to the pandemic is a top priority for federal investigators. Any health care business owner who is concerned about compliance with the CARES Act or is concerned about potential fraud exposure should consult counsel and not wait to be contacted by law enforcement. Those who have already received a subpoena or inquiry from any law enforcement agency should immediately consult with counsel who can assess the full potential for civil and criminal exposure prior to responding.

If you have any questions regarding your practice’s compliance with federal fraud and abuse laws, please contact Matthew D. Lee, Esq. or Marissa Koblitz Kingman, Esq.

On September 10, 2021, the U.S. Department of Health and Human Services (HHS) offered updates regarding its Provider Relief Fund program, including $25.5 billion in new funding that will soon be made available to health care providers.

Here is what you need to know:

Additional $25.5 Billion in Funding

Starting September 29, 2021, health care providers can apply to receive additional funds to be disbursed as follows:

  • $8.5 Billion from the American Rescue Plan for providers in rural areas who serve individuals enrolled in the Medicaid, Medicare, and/or Children’s Health Insurance Program (CHIP).
  • $17 Billion from the Coronavirus Response and Relief Supplemental Appropriation Act of 2020. These “Phase 4” Funds will be distributed based on providers’ lost revenues and COVID-19 expenditures between July 1, 2020 and March 31, 2021, with a focus on getting funds to smaller providers who serve vulnerable or isolated communities. Bonus payments will be disbursed to providers who serve Medicaid, CHIP and/or Medicare patients, including low-income children, pregnant woman, people with disabilities and seniors.

The Health Resources and Services Administration (HRSA) will use existing claims data to calculate payments to providers.

Reconsideration of Phase 3 payments

HRSA has published the detailed payment calculation methodology utilized for Provider Relief Fund “Phase 3” disbursements. Providers who believe the payments they received under Phase 3 were incorrect can now review the specific methodology. Those providers who still believe the Phase 3 payment was incorrect will have the opportunity to request a reconsideration.

Details regarding how to request a reconsideration are forthcoming.

Grace Period for First Reporting Deadline

The September 30, 2021 deadline remains for providers to demonstrate that Provider Relief Funds received between April 10, 2020 and June 30, 2020 were utilized in accordance with their specified terms and conditions. HHS, however, recognizes the impact that recent natural disasters and the surge of COVID cases has had on some providers, so they are instituting a 60-day “grace period.”

While providers who do not submit a report by September 30, 2021 will technically be deemed out of compliance, HRSA will not initiate collection activities or similar enforcement actions until after November 30, 2021.

This post is a courtesy of Fox Rothschild attorney Nathanael F. Williams, Esq., and was first published as an Alert on Fox’s website. 

Health care providers should take special notice of the risk of cyber threats at all times, including over holiday weekends.

Labor Day weekend is upon us. Unfortunately, history has shown that, rather than resting, hackers and other threat actors take advantage of holidays to attack closed or understaffed businesses when they least expect it.

To remind businesses not to let their guard down over the holiday weekend, the Cybersecurity and Infrastructure Security Agency (CISA) and the Federal Bureau of Investigation (FBI) have issued a Joint Cybersecurity Advisory, “Ransomware Awareness for Holidays and Weekends.” The advisory urges businesses “to examine their current cybersecurity posture and implement the recommended best practices and mitigations to manage the risk posed by all cyber threats, including ransomware.” The FBI and CISA have no specific intelligence indicating a particular attack will occur, but these agencies have taken the opportunity, as is Fox Rothschild through this client alert, to remind businesses to stay vigilant over the holiday weekend and take proactive steps to prevent future cyberattacks.

CISA and the FBI note that in 2021 ransomware attacks on or before Mother’s Day weekend, Memorial Day weekend and the Fourth of July weekend had a significant impact on a number of critical industries. In order to mitigate the risk of these ransomware attacks, CISA and the FBI urge businesses to conduct proactive “threat hunting,” a proactive strategy that involves searching out intrusions or malware on systems or the network before a full-scale attack is launched. CISA and the FBI describe threat hunting to include “understanding the IT environment by developing a baseline through a behavior-based analytics approach, evaluating data logs, and installing automated alerting systems.”

These attacks are a serious threat to businesses of all sizes and industries. Based on statistics from the FBI’s Internet Crime Complaint Center (IC3), there has been a 20% increase in the number of ransomware incidents since 2020, and a 225% increase in the amount of the ransom demand since 2020. Furthermore, although many sophisticated ransomware groups conduct “big game” attacks on large businesses, small and medium size businesses with fewer resources to dedicate to cybersecurity also face significant risks. Adding to the danger, cyber threat actors are increasingly utilizing a “lock and leak” approach, in which not only is a business’ data encrypted, the data is also exfiltrated from the business to use as leverage. Cyber threat actors threaten to publish the business’ sensitive information if the ransom is not paid.

The Joint Cybersecurity Advisory provides best practices and recommended mitigations to assist businesses in taking appropriate next steps to protect their IT environments. The FBI and CISA recommend setting up an “on call” system for IT security employees over weekends and holidays so a business can quickly react to a ransomware attack. Furthermore, the FBI and CISA recommend implementing the following network security best practices:

  1. Make offline backups of your data, and implement a regular backup schedule.
  2. Implement a user training program and conduct phishing awareness exercises to help employees recognize the various threats the organization can face and how to respond and thwart them.
  3. If your business uses Remote Desktop Protocol (RDP), or other risky services, secure and monitor it.
  4. Update your operating systems and software, and scan for vulnerabilities.
  5. Ensure strong passwords by having a strict password policy.
  6. Use multifactor authentication.
  7. Secure the network(s); implement segmentation, filter traffic and scan ports.

If your business learns of a potential or actual data security event, Fox Rothschild is here to help. Our Data Breach Prevention & Response Team is available 24/7 to help your business through a cyber attack, and can be reached via our data breach hotline at 800-680-0595 or by email at incidentresponse@foxrothschild.com.

If you have any questions about how to take proactive steps to prevent future cyber attacks or concerns about a prior incident, you can contact Nate Williams or any other member of the Data Breach Prevention & Response Team.

This post is a courtesy of Fox Rothschild attorney William H. Maruca, Esq., and was first published as an Alert on Fox’s website.

A bipartisan bill introduced this summer would impact residential and behavioral health facilities and other health care providers sued under the federal False Claims Act (FCA), making defense of these actions more expensive and difficult.

The False Claims Amendments Act of 2021 was designed in part to undo the result of the U.S. Supreme Court’s 2016 ruling in Universal Health Services, Inc. v. United States ex rel. Escobar, which allowed providers to argue that an alleged misrepresentation or violation was not “material” if the government agency continued to pay claims in some circumstances.

The bill would also force providers to pay for certain discovery costs incurred by the government and would limit the ability of the Justice Department to dismiss FCA cases without a hearing.

Residential and behavioral health providers, like all providers, will face greater obstacles in defending FCA actions if this bill is enacted. Even without these changes, FCA suits are extremely expensive to defend and expose providers to penalties that frequently reach the millions.

The False Claims Act

The FCA is a Civil War-era statute that provides that any person who knowingly submits false claims to the government is liable for up to three times the government’s damages plus a penalty for each false claim, currently between $11,803 and $23,607. The FCA allows private citizens (“relators”) to file whistleblower suits on behalf of the government (called “qui tam” suits) against those who have defrauded the government and receive a portion of the government’s recovery.

False claims can include fictitious or misrepresented services as well as claims based on false records and claims submitted while a provider is in violation of one or more technical requirements of payment including the Anti-Kickback Statute and the Stark Self-Referral Statute.

Materiality

The Escobar case has been interpreted to allow defendants to argue that the government’s continued payment of claims can be cited as evidence that a violation was not “material” and would not be sufficient to support a false claims allegation. The bill would shift the burden of proof to the defendant to prove by “clear and convincing evidence” that that the violation was not, in fact, material to the government’s payment of the claims.

Discovery Expenses

The bill also would require defendants to reimburse the government for costs associated with irrelevant, disproportional or unduly burdensome discovery. This rule is designed to discourage broad “fishing expeditions” by defendants seeking to ferret out evidence that a government agency knew about the alleged violations and did not consider them material. The defendants would need to pay the government’s costs unless they can show the information requested is “relevant, proportionate to the needs of the case, and not unduly burdensome on the government.” The burden of proof of the relevance and proportionality of discovery is on the defendant.

Dismissal of FCA Claims

The federal government can either intervene in a whistleblower’s FCA case or decline to do so, in which case the whistleblowers can generally still proceed at their own expense. The Justice Department has the authority to dismiss meritless or frivolous cases. The bill would require the Justice Department to demonstrate its reasons for dismissal and offer the whistleblower a hearing in which they would have the opportunity to show that the reasons for the government’s dismissal are fraudulent, arbitrary and capricious, or contrary to law.

Action Plan

The best defense is to detect and remedy any compliance issues before they result in whistleblower litigation or government enforcement. A robust and well-implemented compliance program is your most effective preventive medicine. See The Importance of Updating Compliance Programs for Skilled Nursing, Assisted Living and Other Residential Care Facilities.

Your compliance plan should address the seven essential elements identified by the Office of Inspector General in its compliance guidance documents:

  • written policies, procedures and standards of conduct
  • designation of a compliance officer and compliance committee
  • effective training and education
  • effective lines of communication
  • internal monitoring and auditing
  • enforcing standards through well-publicized disciplinary guidelines
  • prompt responses to detected offenses

Contact your Fox Rothschild attorney to review your current compliance efforts and determine if updates or modifications are needed.

Approximately ten days after the first federal court decision in the country about mandatory-COVID-19 vaccinations by an employer, Bridges v. Houston Methodist Hospital (the “Hospital”), 153 of the Hospital’s employees were fired or resigned. On June 12th the court dismissed an action brought by a very small cadre of employees of the Hospital to enjoin the implementation of the its policy of requiring employees to be vaccinated against COVID-19 as a condition of continued employment, The five-page decision by U. S. District Court Judge Lynn Hughes the court upheld the Hospital’s mandatory vaccination policy that carved out narrow exceptions to employee-inoculation by any of the three vaccinations authorized on an emergency use basis by the United States Food and Drug Administration (“FDA”) based upon medical conditions or sincerely held religious beliefs.
The action was instituted by a nurse, Jennifer Bridges, joined by one-hundred and sixteen (116) other employees of Houston Methodist Hospital (the “Hospital”) representing less than 0.5% of the employees to prevent the Hospital from enforcing its mandatory vaccination policy. It is important to note that, when the action was filed, 24,947 of the 26,000 Hospital employees were already vaccinated.
The plaintiffs advanced several arguments to support their request to forestall enforcement of the requirement that Hospital employees be vaccinated by June 7, 2021 or face termination. Their arguments principally relied on the assertion that the COVID-19 vaccinations are experimental and dangerous. The court granted the Hospital’s motion to dismiss all the plaintiffs’ claims.
Specifically, the Plaintiffs argued that termination for failure to comply was equivalent to wrongful termination in violation of Texas law. The court held that Texas law only protects employees from being terminated for refusing to commit an act carrying criminal penalties. The plaintiffs failed to specify the illegal act that they refused to perform.
The Plaintiffs also alleged that the vaccination requirement violated public policy. The court held that Texas law does not recognize a public policy exception to at-will employment on that basis and, even if it did, the Hospital’s requirement was consistent with public policy, including policy embodied in holdings from the Supreme Court and guidance from the Equal Employment Opportunity Commission.
In addition to their wrongful termination claims, the Plaintiffs also alleged that the vaccine requirement violated their option under federal law, 21 U.S.C. Sec. 360bbb-3, to accept or refuse administration of the vaccine. In dismissing the claim, the court explained that the plaintiffs misconstrue 21 U.S.C. Sec. 360bbb-3, which relates to a requirement of the Secretary of Health & Human Services to insure that recipients of medical products introduced into interstate commerce intended for use in an emergency be informed of potential benefits and risks of its use, and given the option to accept or refuse administration of the product. The provision does not apply to private employers and does not related to the authority under “emergency use authorization.”
The Plaintiffs also alleged that they were akin to “human subjects” participating in research, and therefore needed to consent to the vaccination in accordance with the regulations governing human subject research in part 46 of the Code of Federal Regulations. The Court again noted that the plaintiffs misconstrued the applicable provision and held that the protections under the Human Subject Research Law are inapplicable to the Hospital; the Law applies to the government, not a private employer. Further, the court dismissed the allegation that equates the Hospital’s policy with the atrocities of medical experimentation in the concentration camps as “reprehensible.”
The Plaintiffs are appealing the decision. In the interim, several major hospitals throughout the country have promulgated similar policies. It is expected that there will be a ripple effect of these policies, particularly considering this decision. For hospitals and other types of employers contemplating a COVID-19 vaccination mandate, here are some helpful tips:
• Make sure that the policy clearly articulates legitimate essential health and safety concerns that serve as the basis for protecting your staff, customers, and other third parties by generally requiring proof of COVID-19 vaccination;
• Include provisions that enable employees to request a reasonable accommodation for a disability or medical contraindication, or for a sincerely held religious belief or practice, that would preclude vaccination and not create an undue burden for the employer;
• Document all communications with employees in the context of the policy, and;
• Provide a reasonable timeline for phasing-in vaccinations.
Please also be aware of this Firm’s Alert entitled EEOC Issues Guidance on COVID-19 Vaccinations in the Workplace:
EEOC Issues Guidance on COVID-19 Vaccinations in the Workplace | Employment Discrimination Report (foxrothschild.com)

A nationwide telemedicine kickback scheme led to fraudulent Medicare reimbursements for durable medical equipment and genetic testing. The full Department of Justice press release can be found here.

Fraudulent Telemedicine Orders

From June 2018 through September 2020, a Georgia Nurse, known as “Nurse Robin,” and her co-conspirators recruited physicians and other medical professionals to sign orders for orthotic braces, pain creams, and genetic testing. Nurse Robin told the physicians that her team of nurses would contact patients to conduct telemedicine exams on behalf of the physicians.

In fact, there was no team of nurses. According to court documents, the conspirators had targeted elderly Medicare beneficiaries through a series of call centers to obtain their identities and insurance information. They falsified the beneficiaries’ medical histories and examinations in the orders that the physicians signed. Nurse Robin and her co-conspirators then paid the physicians for signing the orders.

The result was thousands of fraudulent orders billed to Medicare and Medicaid, resulting in over $1.5 billion in losses to the federal programs from the thirty-three defendants in the Southern District of Georgia, alone. As the investigation is still ongoing, the true amount of loss is likely greater.

The Aftermath

Nurse Robin pled guilty to the conspiracy and faces a possible statutory sentence of up to five years in prison without parole, financial penalties, restitution and up to three years of supervised release.

Both the U.S. Department of Health and Human Services (HHS) and the Department of Justice made their stance on telemedicine fraud clear. Derrick L. Jackson, Special Agent in Charge for the Office of Inspector General of the HHS, stated, “Telemedicine has become a valuable tool for delivering health services in this time of pandemic. However, bad actors are abusing these tools to commit health care fraud. When marketing and so-called telehealth services are misused, alleged violators can expect aggressive investigation and swift prosecution.” Acting U.S. Attorney Estes said, “Telemedicine has played an increasingly important role in providing accessible healthcare, particularly during the pandemic. With our law enforcement partners, we will continue to work diligently to identify and shut down those who would attempt to use technology and deceit to defraud taxpayer funded safety net programs.”

As the prevalence of telemedicine continues, providers should ensure compliance of their business arrangements to prepare for increased scrutiny. Should you have any questions regarding the compliance of your business arrangements, please contact Anahita Anvari, Edward J. Cyran or any member of the Fox Rothschild Health Law Group.

 

 

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