Morgan Lewis

Healthcare Reform Law

Updates and Alerts

Morgan Lewis is closely following developments and analyzing the impact of the many complex and interlocking components of the Patient Protection and Affordable Care Act of 2010, as amended by the Health Care and Education Reconciliation Act of 2010 (the Healthcare Reform Law) in a series of LawFlashes, white papers, and webcasts.

Multi-Industry

CMS Issues Transparency Reporting Proposed Rule (12/21/2011)
On December 14, the Centers for Medicare and Medicaid Services (CMS) published its long-awaited proposed rule, "Transparency Reports and Reporting of Physician Ownership or Investment Interests." The proposed rule will implement Section 6002 of the Patient Protection and Affordable Care Act (ACA), popularly known as the U.S. Sunshine Act.

New Battlefronts in the Fight Over Healthcare Reform (3/11/2011)
In "2011: Healthcare Policy in the New Congress," we predicted that full-scale repeal and replacement of the 2010 healthcare reform was unlikely and described a number of strategies that Republicans might pursue in an effort to undermine the new law. As opponents implement these strategies, the healthcare reform debate has grown increasingly complex and spread to multiple fronts.

2011: Healthcare Policy in the New Congress (1/7/2011)
Following tremendous changes for healthcare in the 111th Congress, stakeholders can expect continued focus on healthcare reform in the 112th Congress. The Obama administration and Democrats will be defending the 2010 healthcare reform law against Republican attempts to repeal or significantly alter the law. Republican focus on "repealing and replacing" the entire law is likely to give way to a more targeted approach, and other health policy challenges continue as issues in the 112th Congress.

New Congress, Same Challenges: What's Next for Healthcare Policy? (11/8/2010)
The Republican wave on November 2 swept in a considerably different Congress, with a new majority in the U.S. House of Representatives and a substantially altered U.S. Senate. What will this mean for healthcare policy in the upcoming 112th Congress?

Interim Final Rules: Preexisting Conditions, Other Provisions (7/23/2010)
Newly issued rules address Healthcare Reform Law provisions relating to coverage exclusions based on preexisting conditions, patient protections, and other major requirements. The rules provide that if a condition is covered there may be no lifetime dollar amount limit on essential health benefits.

New Rules Clarify Grandfathering of Health Plans (6/21/2010)
Federal agencies have issued interim final rules under the new Healthcare Reform Law clarifying when a group health plan will be deemed grandfathered, the administrative steps necessary to maintain that status, and what changes would result in the loss of grandfathered status. Plans in existence on March 23, 2010, are considered grandfathered and do not have to comply with some individual and group market reforms.

Early Retiree Reinsurance Program Application Process Unfolds (6/11/2010)
The application process for the Healthcare Reform Law’s Early Retiree Reinsurance Program is unfolding. Government websites, including that of the Department of Health and Human Services Office of Consumer Information and Insurance Oversight, now carry a draft application and draft instructions for certification under the program, as well as answers to frequently asked questions.

Guidance on Early Retiree Reinsurance Program (5/14/2010)
The Department of Health and Human Services released its first detailed guidance explaining the early retiree health benefit claim reinsurance program established under the new Healthcare Reform Law, outlining the timing, requirements, transition rules, and claims submission processes necessary to obtain reinsurance for certain early retiree health benefit claims.

Coverage of Age 26 Adult Children: Tax-Free (5/14/2010)
Both the Internal Revenue Service and the Tri-Agency Group (the IRS, the Department of Health and Human Services, and the Department of Labor) have released important new guidance on the operation and taxation of the age 26 adult child rules under the new Healthcare Reform Law. The guidance concludes among other things that such coverage is tax-free to employees and cannot result in a surcharge above the ordinary cost of dependent coverage.

Impact on Employer Group Health Plans (4/14/2010)
Immediate issues involve the Retiree Drug Subsidy Taxation, eventual elimination of the “donut hole” from the Medicare Part D program, Small Employer Tax Credit, Adult Child Coverage, prohibition of pre-existing condition exclusions, and many other changes.

Workplace: Reasonable Break Times, Locations for Nursing Mothers (4/7/2010)
Provision requires employers to provide covered employees with the ability to take unpaid breaks to express milk for their nursing infants.

Life Sciences and Healthcare Industries

An Early Assessment of Reporting and Rebate Issues (7/06/2010)
Pharmaceutical manufacturers face numerous issues as a result of the new Healthcare Reform Law, including concerns about implementation of price-reporting changes under the Medicaid Drug Rebate Program. Also, companies need to develop entire new systems to address rebate requirements of the Medicare Part D Coverage Gap Discount Program.

Guidance on Tax Credit/Cash Grant for Life Sciences Companies (5/24/2010)
The U.S. Department of the Treasury has issued guidance outlining the procedures for obtaining a valuable new 50% tax credit or equivalent cash grant for certain companies in the life sciences industry that made (or will make) a “qualified investment” with respect to a “qualified therapeutic discovery project” in a taxable year beginning in 2009 or 2010.

Compliance and Ethics: A New Mandate (4/27/2010)
Congress for the first time is requiring a broad range of providers, suppliers, and physicians to adopt a compliance and ethics program. Smaller providers and suppliers may feel the impact most acutely, but large and small providers alike will need to be vigilant in their compliance program efforts.

Small Life Sciences Co.s—Tax Credits and Cash Grants (4/21/2010)
Tax credit or equivalent cash grant for certain smaller-sized life sciences companies that made or will make a “qualified investment” with respect to a “qualified therapeutic discovery project” in a taxable year beginning in 2009 or 2010. Credit/grant is capped at $1 billion and will be distributed on a first-come, first-served basis.

Cost/Comparative Effectiveness Research: New Provisions (4/19/2010)
Authorization for establishment of a nonprofit Patient-Centered Outcome Research Institute, whose purpose is to "assist patients, clinicians, purchasers, and policy-makers in making informed health decisions" by conducting CER and disseminating findings.

Impact on Pharma—From Taxes to R&D to Enforcement (4/15/2010)
Direct and indirect effects on pharmaceutical manufacturers range from the imposition of an annual tax starting in 2011 to potentially affecting research and development through the availability of new grants and tax credits.

Biosimilars: A New Regulatory Pathway (4/15/2010)
Establishment of an abbreviated licensure pathway for biosimilar biological products, with provisions covering exclusivity periods, and payment for biosimilars. This development will broadly affect industry activities for both innovator and follow-on biological products.

Changes to 340B Drug Discount Program (4/14/2010)
Expansion of the types of qualifying entities. Also expansion of integrity and enforcement provisions (including civil monetary penalties (CMPs), and a mandate for the development of regulations to address complaints and dispute resolution. Effective January 1, 2010; applies, retroactively, to drugs purchased on or since then.

Medicare Reimbursement for Hospitals and Health Systems (4/13/2010)
Changes in the law, which will affect hospitals of all types, reflect a movement toward linking provider payment to quality, and to encouraging growth in the primary care workforce—and a movement away from indirect payment mechanisms for treating the indigent through disproportionate share hospital payments.

Device Manufacturers: New Tax and Other Requirements (4/13/2010)
Device manufacturers will need to be aware of the various requirements and programs established by the new law, and monitor implementation efforts by those federal agencies tasked with enforcement and oversight of these new provisions.

Medicare Advantage Payments, Prescription Drug Program Payments (4/9/2010)
MA payment changes will result in an approximately $135 billion reduction in direct federal spending over the next 10 years. On the other hand, the law increases subsidies and benefits for the Medicare drug benefit. Companies that offer MA and Part D plans and pharmaceutical manufacturers will be the most directly affected.

Healthcare Fraud and Abuse and Program Integrity Provisions (3/31/2010)
The new law contains more than 32 sections related to healthcare fraud and abuse and program integrity and significantly amends existing criminal, civil, and administrative anti-fraud statutes. The provisions affect business operations, commercial transactions, and compliance policies in every sector of the health industry.

New Transparency Requirements for the Health Industry (3/29/2010)
A number of new transparency requirements affect several health industry sectors, including drug and device manufacturers and suppliers, pharmacy benefit managers, physician practices that provide ancillary services, and skilled nursing facilities.