Tag: rulemaking

Beware Before You Flare: EPA Revamps Rulemaking to Pave the Way for Methane Emission Reductions

On November 15, 2022, the United States Environmental Protection Agency (US EPA) issued the pre-publication version of supplemental proposed rulemaking for reduction of methane emissions in the oil and natural gas sector. The original proposed rule, published on November 15, 2021, sought to strengthen methane standards for new sources (New Source Performance Standards or NSPS), establish nationwide emission guidelines (EG) for regulation of existing sources, and develop new standards for unregulated sources. US EPA ultimately received more than 470,000 public comments. The rules, once finalized, will be included in 40 CFR Part 60, Subpart OOOOb (NSPS) and Subpart OOOOc (EG).

The agency anticipated a need for additional review in the original proposed rule, in which US EPA stated it would issue supplemental proposed rulemaking under its authority in the Clean Air Act sections 111(b) and (d). While the original rule already had an ambitious target of reducing methane by 74%, the supplemental proposal would reduce methane from covered sources by 87% below 2005 levels. The rule generally governs production and processing (i.e., well sites, compressor stations, and natural gas processing plants) as well as natural gas transmission and storage.

Key changes in the supplemental proposed rule include the following:

  • Super-emitter Response Program: Establishment of a super-emitter response program intended to reduce the risk of such events. Owners or operators that receive certified notifications of emissions greater than 100 kg/hr of methane would be required to take action.
  • Well Closure Plans: EPA will now require owners of well sites to submit a well closure plan that includes steps to plug wells, requires financial assurance, and includes a schedule to complete the closure and perform a final survey.
  • Advanced Methane Detection: In response to comments supporting advanced methane detection technologies, EPA has proposed a matrix where owners and operators have the flexibility to use approved alternative screening approaches with development of a plan and notification to the agency. The agency will further update the proposed protocol for optical gas imaging (OGI) in Appendix K.
  • Leak Inspection: EPA will now require identification and correction of leaks, a source of fugitive emissions, at all well sites, including new and existing. While EPA removed exemptions, the type of leak monitoring will vary depending on site characteristics and equipment in four primary categories: (1) single wellhead-only and small well sites; (2) wellhead-only sites with two or more wellheads; (3) sites with major production and processing equipment; and (4) well sites on the Alaska North Slope.
  • Flares: EPA will require flare flames to be lit at all times. Additionally, in order to flare, owners of oil wells with associated gas will be required to either implement alternatives permitted by the rule (such as routing to a sales line) or certify that alternatives are not safe or technically feasible.
  • Additional Regulated Sources: EPA has added strengthened standards for pneumatic pumps (zero-emission standard), updated standards for wet seal centrifugal compressors, and developed new standards for dry seal centrifugal pumps (currently unregulated).

Given the agency’s significant focus on environmental justice and community outreach, US EPA also seeks to provide more opportunities for vulnerable communities and Tribal communities to participate in the development of state plans. In fact, the agency held a webinar specific to Tribal communities and environmental justice communities on November 17, 2022. During the webinar, US EPA explained how the revised rule requires states to conduct meaningful engagement with vulnerable communities through early outreach and request for input. States developing plans for EG will be required to participate in “timely engagement with pertinent stakeholder representation . . . [i]t must include the development of public participation strategies to overcome linguistic, cultural, institutional, geographic, and other barriers to participation to assure pertinent stakeholder representation.”

The agency is also seeking additional insight from the regulated industry on advanced technologies that can be utilized to reduce methane and utilize associated gas. The original proposed rule requested public comment on a potential standard for oil wells with associated gas that would require owners or operators to route associated gas to a sales line or, alternatively, use it for another beneficial use. During this round of comments, US EPA now seeks to understand emerging technologies “that provide uses for the associated gas in a beneficial manner other than routing to a sales line, using as a fuel, or reinjecting the gas.”

The agency extended the timeline for a final rulemaking to 2023 and has issued new opportunities for public comment and training. Written comments are due to the agency by February 13, 2023 and can be submitted to Docket No. EPA-HQ-OAR-2021-0317. There will also be a series of public hearings on January 10-11, 2023 that require advance registration. To assist in preparation, US EPA published a document highlighting areas where the agency continues to seek public input. We are prepared to assist clients in engaging with the agency by providing comment and preparing for the final rule to be implemented next year.

Article By Jennifer Tharp of Squire Patton Boggs (US) LLP

For more environmental legal news, click here to visit the National Law Review.

© Copyright 2022 Squire Patton Boggs (US) LLP

Could Leagues and Teams be Joint Employers Before the NLRB?

The National Labor Relations Board (NLRB) has released a Notice of Proposed Rulemaking to change the standard for determining if two employers may be joint employers under the National Labor Relations Act (NLRA). The proposed rule, expected to become effective sometime in 2023, could make it more likely that professional and collegiate leagues would be found to be joint employers of any unionized professional players or collegiate student-athletes who play for teams that are members of those leagues.

As a joint employer of unionized players of member teams, a league could be jointly responsible for unfair labor practices committed by the teams or the team’s supervisors or managers (i.e., coaches and administrators), be required to participate in collective bargaining negotiations with the teams concerning the wages and other terms and conditions of employment of the players, and picketing directed at the league would be considered primary and therefore permissible (rather than secondary and subject to injunction).

Currently, the NLRB will find two or more employers to be joint employers if there is evidence that one employer has actually exercised direct and regular control over essential employment terms of another employer’s employees. An employer that merely reserves the right to exercise control or that has exercised control only indirectly will not be found to be a joint employer. The NLRB has proposed that the Browning Ferris standard be restored. Under the proposed rule, two or more employers will be found to be joint employers if they “share or codetermine those matters governing employees’ essential terms and conditions of employment.” Importantly – and the critical import of the proposed rule – the NLRB will consider both evidence that direct control has been exercised and that the right to control has been reserved (or exercised indirectly) over these essential terms and conditions of employment when reviewing two or more employers for status as joint employers.

Professional athletes are employees under Sec. 2(3) of the NLRA, of course. As for collegiate student-athletes, NLRB General Counsel Jennifer Abruzzo issued a memorandum, GC 21-08, announcing the intention to consider scholarship athletes at private colleges and universities to be employees because, as she wrote, they “perform services for their colleges and the NCAA, in return for compensation, and subject to their control.” Stating in summation “that this memo will notify the public, especially Players at Academic Institutions, colleges and universities, athletic conferences, and the NCAA, that [she] will be taking that legal position in future investigations and litigation” under the NLRA, Abruzzo signaled that conferences, leagues, and the NCAA will face joint-employer analysis in an appropriate case.

The “essential terms and conditions of employment” will translate to the sports workplace in the nature of game, practice and meeting times, travel and accommodation standards, equipment and safety standards, conduct rules and disciplinary proceedings, the length of a season, the number of games and playoff terms, and numerous other areas. Professional leagues may already coordinate with their member teams on a number of employment terms for players. For collegiate conferences and leagues, this may be new. Under the current standard, a league could better insulate itself from the decisions made by its members’ coaches and administrators by not exercising direct involvement in those matters. Under the proposed rule, a league or conference that merely has the power (even if reserved and unexercised) to make decisions affecting the “work” conditions for student-athletes could be jointly liable along with the institution for decisions made solely by the institution’s agents.

Consequently, conferences and leagues should consider training managers on their responsibility under the NLRA to private sector employees. They should also consider the role they want to play in collective bargaining should any of the student-athletes at their member institutions unionize.

Article By Patrick L. Egan of Jackson Lewis P.C.

For more labor and employment legal news, click here to visit the National Law Review.

Jackson Lewis P.C. © 2022

It’s Time To Review Your Online Patient-User Interface: DOJ Issues New Federal Guidance on Telemedicine and Civil Rights Protections

As online digital health services continue to enjoy broader use and appeal, federal regulators are concerned some telemedicine online patient-user interfaces fail to accommodate persons with disabilities and limited English proficiency. Such failures in “product design” can violate federal civil rights laws and the Americans with Disabilities Act (ADA), according to new policy guidance jointly issued by the U.S. Department of Health and Human Services (HHS) and Department of Justice (DOJ).

The document, Nondiscrimination in Telehealth, is specifically directed to companies offering telemedicine services and instructs such covered entities to immediately take specific steps to comply with the various “accessibility duties” under federal civil rights laws. The guidance focuses on ensuring accessibility for two populations of users: 1) people with disabilities and 2) people with Limited English Proficiency (LEP).

Who is Subject to these Rules?

The guidance refers to “covered entities” subject to these rules. Under the rules, “covered entities” are any health programs and activities receiving federal financial assistance (in addition to programs and activities administered by either a federal executive agency or an entity created by Title I of the Affordable Care Act). While the guidance does not define what constitutes “receiving federal financial assistance”, HHS has historically held that providers who receive federal dollars solely under traditional Medicare Part B were not covered entities. However, a recently-proposed rule suggests HHS will significantly expand the scope of covered entities, and soon. Telemedicine providers should be prepared to comply with these federal laws.

People with Disabilities

The guidance explains that no person with a disability shall – because of the disability – be excluded from participation in or be denied the benefits of the services, programs, or activities of a covered entity, or otherwise be subjected to discrimination by a covered entity. The requirements in the guidance is supported by several federal laws, including the Americans With Disabilities Act, the Affordable Care Act Section 1557, and the Rehabilitation Act Section 504.

Applying these federal civil rights protections to telemedicine services, the guidance states companies must make reasonable changes to their policies, practices, or procedures in order to provide “additional support to patients when needed before, during, and after a virtual visit.”

DOJ and HHS provided the following as examples of such “additional support” obligations:

  • A dermatology practice that typically limits telehealth appointments to 30 minutes may need to schedule a longer appointment for a patient who needs additional time to communicate because of their disability.

  • A doctor’s office that does not allow anyone but the patient to attend telehealth appointments would have to make reasonable changes to that policy to allow a person with a disability to bring a support person and/or family member to the appointment where needed to meaningfully access the health care appointment.

  • A mental health provider who uses telehealth to provide remote counseling to individuals may need to ensure that the telehealth platform it uses can support effective real-time captioning for a patient who is hard of hearing. The provider may not require patients to bring their own real-time captioner.

  • A sports medicine practice that uses videos to show patients how to do physical therapy exercises may need to make sure that the videos have audio descriptions for patients with visual disabilities.

People with LEP

The second area of the guidance is protections for LEP individuals under Title VI of the Civil Rights Act of 1964 (Title VI). Under Title VI, no person shall be discriminated against or excluded from participation in or be denied the benefits of services, programs, or activities receiving federal financial assistance on the basis of race, color, or national origin.

For telemedicine services, the guidance states that the prohibition against national origin discrimination extends to LEP persons. Namely, telemedicine companies must take reasonable steps to ensure meaningful access for LEP persons. Such “meaningful access” includes providing information about the availability of telehealth services, the process for scheduling telehealth appointments, and the appointment itself. In many instances, HHS states, language assistance services are necessary to provide meaningful access and comply with federal law.

These language assistance services can include such measures as oral language assistance performed by a qualified interpreter; in-language communication with a bilingual employee; or written translation of documents performed by a qualified translator

DOJ and HHS provided the following as examples of such “meaningful access” obligations:

  • In emails to patients or social media postings about the opportunity to schedule telehealth appointments, a federally assisted health care provider includes a short non-English statement that explains to LEP persons how to obtain, in a language they understand, the information contained in the email or social media posting.

  • An OBGYN who receives federal financial assistance and legally provides reproductive health services, using telehealth to provide remote appointments to patients, provides a qualified language interpreter for an LEP patient. The provider makes sure that their telehealth platform allows the interpreter to join the session. Due to issues of confidentiality and potential conflicts of interest (such as in matters involving domestic violence) providers should avoid relying on patients to bring their own interpreter.

What if Making These Changes is Expensive?

While not directly addressed in the guidance, the cost for implementing accessibility measures generally falls on the company itself. Federal ADA regulations prohibit charging patients extra for the cost of providing American Sign Language (ASL) interpreters or similar accommodations. In fact, a covered entity may be required to provide an ASL interpreter even if the cost of the interpreter is greater than the fee received for the telemedicine service itself. With respect to LEP interpreters, HHS issued separate guidance stating it is not sufficient to use “low-quality video remote interpreting services” or “rely on unqualified staff” as translators.

However, companies are not required to offer an aid or service that results in either an undue burden on the company or requires a fundamental alteration in the nature of the services offered by the company. This is an important counterbalance in the law. Yet, the threshold for what constitutes an “undue burden” on a company or a “fundamental alteration” to the nature of the services is not bright line and requires a fact-specific assessment under the legal requirements.

Conclusion

Telemedicine companies subject to the guidance should heed the government’s warning and look inward on patient-facing elements. The first step is to simply have the website and app platform reviewed (most particularly the patient online user interface) by a qualified third party to determine if its design and features are sufficiently accessible for people with disabilities, as well as LEP persons. That time is also a prudent opportunity to review the user interface to confirm it complies with state telemedicine practice standards, e-commerce rules, electronic signatures or click-sign laws, and privacy/security requirements. Because these laws have undergone rapid and extensive changes during the Public Health Emergency, it is recommended to conduct these assessments on a periodic/annual basis.

If a company believes the expense of making these product design changes to ensure accessibility would be prohibitively expensive, it should check with experienced advisors to determine if the changes would constitute an “undue burden” or “fundamental alteration.” Otherwise, federal guidance is clear that refusing to make reasonable changes can be a violation of federal civil rights laws.

Article By Kate L. Pamperin, Larry S. Perlman, and Nathaniel M. Lacktman of Foley & Lardner LLP

For more health and telemedicine legal news, click here to visit the National Law Review.

© 2022 Foley & Lardner LLP

SEC Proposes to Clear-Up Clearing Agencies’ Governance to Mitigate Directors’ Potential Conflicts of Interest

Clearing agencies registered with the Securities and Exchange Commission (SEC) will have to make governance changes to their boards of directors under a new rule proposed by the SEC on August 8, 2022.

The SEC proposed the new rule1 to mitigate the conflicts of interests inherent in clearing agency relationships. The rule follows episodes of market volatility in 2021 that included large fluctuations surrounding COVID-19 and the meme stock craze.

The new rule would amend Section 17Ad-25 of the Securities Exchange Act of 1934 (Exchange Act) to require additional management and governance requirements for clearing agencies that register with the SEC. The proposed rules provide specific new governance requirements on clearing board composition, independent directors, nominating committees and risk management committees. The rule also requires the board to oversee relationships with critical service providers and includes a board obligation to consider various stakeholder views and inputs.

Rationale

The SEC’s rationale for proposing Rule 17Ad-25, titled Clearing Agency Governance and Conflicts of Interest, is to reduce the risk that conflicts of interest inherent in various clearing agency relationships substantially harm the security-based swaps or larger financial market. The SEC is proposing this rule to mitigate conflicts of interest, promote the fair representation of owners and participants in the governance of a clearing agency, identify responsibilities of the board, and increase transparency into clearing agency governance.

The SEC noted that those episodes of increased market volatility revealed certain vulnerabilities in the US securities market and the essential role clearing agencies play in managing the risk if securities transactions fail to clear.

The SEC observed three potential sets of conflicts of interest that the proposed rule attempts to address.

  1. The proposed rule addresses the different perspectives the various stakeholders involved in clearing agencies might have. In particular, a clearing agency owner’s potential interest in protecting the equity and continued operation of the clearing agency diverges from a participant’s potential interest in avoiding the allocation of losses from another defaulting participant. For instance, in the event of a loss, clearing agency participants might prefer to limit access to clearing, while owners may choose to expand the scope of products offered to collect fees.

  2. Larger clearing agency participants’ priorities may diverge significantly from the interests of smaller clearing agency participants. In particular, when a small number of dominant participants exercise control over a registered clearing agency concerning services provided by that clearing agency, those participants might promote margin requirements that are not commensurate with the risks they take, thereby indirectly limiting competition and increasing profit margins for themselves. In other words, a registered clearing agency dominated by a small number of large participants might make decisions designed to provide them with a competitive advantage.

  3. Certain participants may exert undue influence to limit access to the clearing agency based on their own interests, and thus could limit the benefits of the clearing agency to indirect participants.

Rule Requirements

The proposed rule would impose these seven requirements:

  1. define independence in the context of a director serving on the board of a registered clearing agency and require that a majority of directors on the board be independent, unless a majority of the voting rights distributed to shareholders of record are directly or indirectly held by participants of the registered clearing agency, in which case at least 34 percent of the board must be independent directors;

  2. establish requirements for a nominating committee, including with respect to the composition of the nominating committee, fitness standards for serving on the board, and documenting the process for evaluating board nominees;

  3. establish requirements for the function, composition, and reconstitution of the risk management committee;

  4. require policies and procedures that identify, mitigate or eliminate, and document the identification and mitigation or elimination of conflicts of interest;

  5. require policies and procedures that obligate directors to report potential conflicts promptly;

  6. require policies and procedures for the board to oversee relationships with service providers for critical services; and

  7. require policies and procedures to solicit, consider, and document the registered clearing agency’s consideration of the views of its participants and other relevant stakeholders regarding its governance and operations.

The proposing release will be published on SEC.gov and in the Federal Register. The public comment period will remain open for 60 days following publication of the proposing release on the SEC’s website or 30 days following publication of the proposing release in the Federal Register, whichever period is longer.

FOOTNOTES

1 https://www.sec.gov/rules/proposed/2022/34-95431.pdf

Article By Susan Light of Katten. Jacob C. Setton, an associate in the Financial Markets and Funds practice and candidate for admission to the New York State bar, also contributed to this advisory.

For more SEC and securities legal news, click here to visit the National Law Review.

©2022 Katten Muchin Rosenman LLP

HHS Recognizes Changing Environment of Research: Still Time to Comment

Late last month the Department of Health and Human Services (HHS) and other Federal Departments and Agencies announced an extension until January 6, 2016  to the comment period for the Federal Policy for the Protection of Human Subjects notice of proposed rulemaking (NPRM). The proposed rulemaking is the most sweeping since 1991 when HHS codified The Common Rule, 45 C. F. R. part 46,  and  recognizes the changed research environment with many multisite studies and the  expansion of research with more data accessible through technology.  The NPRM seeks to further the principles of autonomy and  beneficence by protecting privacy and improving the consent process  in the new world of research while creating avenues to lessen the administrative burden  and to promote research.

The NPRM proposes to apply The Common Rule to all studies, regardless of funding source, conducted by a U.S. institution that receives federal funding for human subjects research.  Currently, The Common Rule applies to studies funded by certain federal agencies. Most significantly, the proposed rules impact the following areas:

Streamlined process  – To streamline the process of initiating certain activities the NPRM creates a  new category not currently in The Common Rule, exclusions.  Exclusions are for activity that is not research, that is low risk and for which there may be statutory protections.  Accordingly,  no procedures need to occur under the Common Rule to approve of the activity.  An example of an exclusion would include quality assurance activities.

The exemptions under The Common Rule are expanded in the NPRM. Exemptions are different than exclusions in that certain procedures need to occur for them to proceed such as recording, privacy safeguards, broad consent, or notice.  How HHS ultimately defines adequate notice will be critical in protecting privacy and autonomy rights in exempt research.

As well, a single institutional review board (IRB) would approve all multisite research. Independent IRBs would be held directly responsible for compliance with The Common Rule.

In addition, another streamline in the IRB process is not requiring continuing review of research where there is minimal risk. For instance, continuing review would not be required if a study undergoes expedited review or if there are completed interventions where only data continues to be analyzed. There would need only to be an annual confirmation that there are no changes.  An IRB would be able to require continuing review  with documentation of  the reason for the increased requirement.

Informed Consent  – The NPRM mandates a simplified  informed consent form with appendices with more detailed information. The goal is to provide potential research subjects all the essential information  that a reasonable person would need to consent to participation in research.  The NPRM suggests using the reasonable person standard as a means to gauge the protections in the process.  Currently, there are recommendations that informed consent forms should to be at no higher than an eighth grade education level, but the consent forms are often mired in so much detail human subjects may not easily comprehend the forms.

Research with Biospecimens – A particularly sweeping area of the NPRM is the protection of biospecimens (e.g., blood or urine) which is reflected in a proposed change in the definition of human subjects to include unidentified biospecimens. Hospitals, providers and laboratories  collect biospecimens from patients as part of medical care. Those biospecimens may be stored and used as part of research without the patient’s knowledge. The ethical issue regarding the use of biospecimens in research is well described by Professor Ellen Wright Clayton of Vanderbilt University, “[a] tremendous amount of epidemiological  research and other types of investigations have been done in the United States for decades without any informed consent or notification whatsoever….” [i] The proposed rule would require a broad consent  template covering the consent for storage  and maintenance of the biospecimens and the consent for future unspecified research. An alternative to the broad consent for the use of biospecimens would be a potential waiver of consent by the IRB for compelling scientific research, but consent could not be waived if the human subject declined to sign the broad consent form. Use of the IRB waiver of consent mostly likely would be rare, as proposed in the NPRM.

Secondary Research Use of Data – The NPRM also recognizes the growing business of information technology and the availability of data available for secondary use.  Researchers often can find data from sources such as the internet or through mHealth devices. The goal of the NPRM seems to be able to allow the secondary use of data in research or other activities while creating a balance for privacy protections. Secondary research activity excluded from The Common Rule would be a) publically available data (not biospecimens) or data recorded without identifiers; b) data protected through the provisions of the Health Insurance Portability and Accountability Act of 1996, as amended (HIPAA); c) data confined to a single institution and its internal quality assurance programs and d)  data through federally conducted research.

Exempt secondary use research proposed in the NPRM would include a) identifiable private information where there is notice, privacy safeguards and use solely for specific research and b) storage and maintenance of data for secondary use where there are privacy safeguards, limited IRB review of the consent process, and  specific studies where the individual results will not be provided to the subjects.  Again, the procedures for notice will be a critical component of privacy protections with secondary use research.

There has been an overwhelming response to the NPRM which proposes comprehensive changes to The Common Rule. While there is seemingly a streamlined process to allowing certain activities or research to occur in the NPRM, there are areas in need of additional guidance such as the lack of clarity on certain privacy protections. A copy of the NPRM as well as details on how to submit comments can be found in this link.

Article By Dawn R. Crumel & Sonja S. Carlson of Sheppard, Mullin, Richter & Hampton LLP

© 2015, Sheppard Mullin Richter & Hampton LLP.

[i] Institute of Medicine (US) Roundtable on Translating Genomic-Based Research for Health, Establishing Precompetitive Collaborations to Stimulate Genomics-Driven Product Development: Workshop Summary, Washington (DC): National Academies Press (US); 2011, 6, Ethical Challenges in the Use of Biospecimens.