Tag: telemedicine

Buying, Selling, and Investing in Telehealth Companies: Navigating Structural and Compliance Issues

A multi-part series highlighting the unique health regulatory aspects of Telemedicine mergers and acquisitions, and financing transactions

Investors in the telehealth space and buyers and sellers of telehealth companies need to account for a set of health regulatory considerations that are unique to deals in this sector. As all parties to potential telehealth transactions analyze their long term role in the telehealth marketplace, two of the central issues to any transaction are compliance and structure – both in terms of structuring the telehealth transaction itself and due diligence issues that arise related to a target’s structure.

The COVID-19 pandemic, combined with strained health care staffing and provider availability, have accelerated the growth of the telehealth, and start-ups and traditional health systems alike are competing for access to patient populations in the telehealth space. However, as we adjust to life with COVID-19 as the norm, the expiration of the federal Public Health Emergency (PHE) looms, and the national economy contracts, we expect that the remainder of 2022 and into 2023 will see consolidation as the telehealth market begins to saturate and the long-term viability of certain platforms are tested. Telehealth companies, health systems, pharma companies and investors are all in potential positions to take advantage of this consolidation in a ripening M&A sector (while startups in the telehealth space continue to seek venture and institutional capital).

This is the first post in a series highlighting the unique health regulatory aspects of telehealth transactions. Future installments of this series are expected to cover licensure and regulatory approvals, compliance / clinical delivery models, and future market developments.

Telehealth Transaction Structure Considerations

The structure of any given telehealth transaction will largely depend on the business of the telehealth organization at play, but also will depend on the acquirer / investor. Regardless of whether a party is buying, selling or investing in a telehealth company, structuring the transaction appropriately will be important for all parties involved. While a standard stock purchase, asset purchase or merger may make sense for many of these transactions, we have also seen a proliferation of, affiliation arrangements, joint ventures (JV), alliances and partnerships.  These varieties of affiliation transactions can be a good choice for health systems that are not necessarily looking to manage or develop an existing platform, but instead are looking to leverage their patient populations and resources to partner with an existing technology platform. An affiliation or JV is more popular for telehealth companies operating purely as a technology platform (with no core business involving clinical services being provided). For parties in the traditional healthcare provider sector that provide clinical services, an affiliation or JV, which is easier to unwind or terminate than a traditional M&A transaction, can allow the parties to “test the waters” in a new, combined business venture. The affiliation or JV can take a variety of forms, including technology licensing agreements; the creation of a new entity to house the telehealth mission, which then has contractual arrangements with the both the JV parties; and exclusivity arrangements relating to use of the technology and access to patient populations.

While an affiliation or JV offers flexibility, can minimize the need for a large upfront investment, and can be an attractive alternative to a more permanent purchase or sale, there can be increased regulatory risk. Entrepreneurs, investors, and providers considering any such arrangement should bear in mind that in the wake of the COVID-19 pandemic and proliferation of telehealth, the Office of Inspector General of the Department of Health and Human Services (HHS-OIG) has expressed a heightened interest in investigating so called “telefraud” and recently issued a special fraud alert regarding suspect arrangements, discussed in this prior post. Further, the OIG’s guidance on contractual joint ventures that would run afoul of the federal Anti-Kickback Statute (AKS) should be front of mind and parties should strive to structure any affiliation or JV in a manner that meets or approximates an AKS safe harbor.

Target Telehealth Company Structure Compliance

Where telehealth companies are providing clinical services, and are not purely technology platforms, structuring and transaction diligence should focus on whether the target is operating in compliance with corporate practice of medicine (CPOM) laws. The CPOM doctrine is intended to maintain the independence of physician decision-making and reduce a “profits over people” mentality, and prevent physician employment by a lay-owned corporation unless an exception applies. Most states that have adopted CPOM impose similar restrictions on other types of clinical professionals, such as nurses, physical therapists, social workers, and psychologists. Telehealth companies often attempt to utilize a so-called “friendly PC” structure to comply with CPOM, whereby an investor-owned management services organization (“MSO”) affiliates with a physician-owned professional corporation (or other type of professional entity) (a “PC”) through a series of contractual agreements that foster a close working relationship between the MSO, PC, and PC owner and whereby the MSO provides management services, and sometimes start-up financing. The overall arrangement is intended to allow the MSO to handle the management side of the PC’s operations without impeding the professional judgment of the PC or the medical practice of its physicians and the PC owner.

CPOM Compliance Considerations and Diligence for Telehealth Companies

A sophisticated buyer will want to confirm that the target’s friendly PC structure is not only formally established, but is also operationalized properly and in a manner that minimizes fraud and abuse risk. If CPOM compliance gaps are identified in diligence this may, at worst, tank the deal and, at best, cause unexpected delays in the transaction timeline, as restructuring may be required or advisable. The buyer may also request additional deal concessions, such as a purchase price reduction and special indemnification coverage (with potentially a higher liability limit and an escrow as security). Accordingly, a telehealth company anticipating a sale or fund raise would be well served to engage in a self-audit to identify any CPOM compliance issues and undertake necessary corrective actions prior to the commencement of a transaction process.

Below are nine key questions with respect to CPOM compliance and related fraud and abuse issues that a buyer/investor in a telehealth transaction should examine carefully (and that the target should be prepared to answer):

  1. Does target have a PC that is properly incorporated or foreign qualified in all states where clinical services are provided (based on the location of the patient)?
  2. Does the PC owner (and any directors and officers of the PC, to the extent different from the PC owner) have a medical license in all states where the PC conducts business (to the extent in-state licensure is required)? To the extent the PC has multiple physician owners and directors/officers, are all such individuals licensed as required under applicable state law?
  3. Does the PC(s) have its own federal employer identification number, bank account (including double lockbox arrangement if enrolled in federal healthcare programs), and Medicare/Medicaid enrollments?
  4. Does the PC owner exercise meaningful oversight and control over the governance and clinical activities of the PC? Does the PC owner have background and expertise relevant to the business (e.g., a cardiologist would not have appropriate experience to be the PC owner of a PC that provides telemental health services)?
  5. Are the physicians and other professionals providing clinical services for the business employed or contracted through a PC (rather than the MSO)? Employment or independent contractor agreements should be reviewed, as well as W-2s, and payroll accounts.
  6. Is the PC properly contracted with customers (to the extent services are provided on a B2B basis) and payors?
  7. Do the contractual agreements between the MSO and PC respect the independent clinical judgment of the PC owner and PC physicians and otherwise comply with state CPOM laws.
  8. Do the financial arrangements between the MSO, PC, and PC owner comply with AKS, the federal Stark Law, and corollary state laws and fee-splitting prohibitions, to the extent applicable?
  9. Is the PC owner or any other physician performing clinical services for the PC an equity holder in the MSO? If so, are these equity interests tied to volume/value of referrals to the PC or MSO (i.e., if the MSO provides ancillary services such as lab or prescription drugs) or could equity interests be construed as an improper incentive to generate healthcare business (e.g., warrants that can only be exercised upon attainment of certain volume)?

Telehealth companies considering a sale or financing transaction, and potential buyers and investors, would be well served to spend time on the front end of a potential transaction assessing the above issues to determine potential risk areas that could impact deal terms or necessitate any friendly PC structuring.

Article By Hannah E. Zaitlin, Mitchell D. Lindstrom, David S. Sanders, and Natasha Allen of Foley & Lardner LLP

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

© 2022 Foley & Lardner LLP

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

Alabama Enacts New Telemedicine Law

Alabama Governor Kay Ivey recently signed SB 272 into law, setting forth telemedicine practice standards and abolishing Alabama’s previous “special purpose license” that allowed physicians licensed in other states to practice across state lines into Alabama. The law is effective July 11, 2022.

The law creates a new article in the Code of Alabama (Sections 34-24-701 through 34-24-707 of Chapter 24, Title 34). The statutory language is lengthy, but the key provisions are summarized below.

Medical License

Unless the physician meets an exception to licensure (e.g., peer-to-peer consultations, irregular or infrequent services), a physician must obtain either a full Alabama medical license or a license via the Interstate Medical Licensure Compact in order to provide “telehealth medical services” to a patient located in Alabama.

  • Telehealth medical services means “[d]igital health, telehealth, telemedicine, and the applicable technologies and devices used in the delivery of telehealth. The term does not include incidental communications between a patient and a physician.
  • The term “irregular or infrequent” services refers to “telehealth medical services” occurring less than 10 days in a calendar year or involving fewer than 10 patients in a calendar year.

Defined Terms and Allowable Modalities

  • Telehealth is defined as “[t]he use of electronic and telecommunications technologies, including devices used for digital health, asynchronous and synchronous communications, or other methods, to support a range of medical care and public health services.”
  • Telemedicine is defined as “[a] form of telehealth referring to the provision of medical services by a physician at a distant site to a patient at an originating site via asynchronous or synchronous communications, or other devices that may adequately facilitate and support the appropriate delivery of care.” The term includes digital health, but does not include incidental communications between a patient and a physician.
  • Digital Health is defined as “[t]he delivery of health care services, patient education communications, or public health information via software applications, consumer devices, or other digital media.”
  • Asynchronous is defined as “[t]he electronic exchange of health care documents, images, and information that does not occur in real time, including, but not limited to, the collection and transmission of medical records, clinical data, or laboratory results.”
  • Synchronous is defined as “[t]he real-time exchange of medical information or provision of care between a patient and a physician via audio/visual technologies, audio only technologies, or other means.”

Physician-Patient Relationship

A physician-patient relationship may be formed via telehealth without a prior in-person exam.

Telemedicine Prescribing of Medications and Controlled Substances

A practitioner may prescribe a legend drug, medical supplies, or a controlled substance to a patient via telehealth. However, a prescription for a controlled substance may only be issued if:

  1. The telehealth visit includes synchronous audio or audio-visual communication using HIPAA compliant equipment;
  2. The practitioner has had at least one in-person encounter with the patient within the preceding 12 months; and
  3. The practitioner has established a legitimate medical purpose for issuing the prescription within the preceding 12 months.

In-Person Visit for Unresolved Medical Condition

If a physician or practice group provides telehealth medical services more than 4 times in a 12-month period to the same patient for the same medical condition without resolution, the physician must either see the patient in-person within 12 months or refer the patient to a physician who can provide the in-person care within 12 months. This in-person visit requirement does not apply to the provision of mental health services.

The Alabama Board of Medical Examiners and the Alabama Medical Licensure Commission are currently developing administrative rules in accordance with the new law.

Article By Kristen A. Murphy and Jacqueline N. Acosta of Foley & Lardner LLP

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

© 2022 Foley & Lardner LLP

NJDOBI Mandates Insurance Carriers to Reimburse Providers for Telemedicine and Telehealth Encounters During State of Emergency and Public Health Emergency

NJDOBI issued Bulletin 20-07 to mandate insurance carriers to reimburse providers for telemedicine and telehealth encounters.  This applies to: (1) all health insurance companies; all HMOs; all health service corporations and any other entity issuing health benefits plans in New Jersey.

The mandate requires the insurance carriers to do the following:

  1. Review their telemedicine and telehealth networks for adequacy and grant any requested in-plan exception for individuals to access out of health telehealth providers if network providers are unavailable.
  2. Encourage their network providers to utilize telemedicine or telehealth services wherever possible and clinically appropriate in order to minimize exposure of provider staff and other patients to those who may have the COVID-19 virus
  3. Update their policies to include reimbursement for telehealth services that are provided by a provider in any manner that is practicable, including, if appropriate, and clinically appropriate, by telephone.   The Bulletin suggests that this be done on the carrier’s website.  This would include instruction on the use of telephone-only communications to establish a physician-patient relationship and the expanded use of telehealth for the diagnosis, treatment, ordering of tests, and prescribing for all conditions. Carriers are required to update telehealth policies to include telephone only services within the definition of telehealth.
  4. Reimburse providers that deliver covered services to members via telemedicine or telehealth. Carriers may establish requirements for such telemedicine and/or telehealth services, and guidance issued by the Department, including documentation and recordkeeping, but such requirements may not be more restrictive than those for in-person services. Carriers are not permitted to impose any specific requirements on the technologies used to deliver telemedicine and/or telehealth services (including any limitations on audio-only or live video technologies) during the state of emergency and public health emergency declared pursuant to EO 103.
  5. Ensure that the rates of payment to in-network providers for services delivered via telemedicine or telehealth are not lower than the rates of payment established by the carrier for services delivered via traditional (i.e., in-person) methods, and carriers must notify providers of any instructions that are necessary to facilitate billing for such telehealth services.
  6. May not impose any restriction on the reimbursement for telehealth or telemedicine that requires that the provider who is delivering the services be licensed in a particular state, so long as the provider is in compliance with P.L. 2020, c.3 and c.4 and this guidance.
  7. May not impose prior authorization requirements on medically-necessary treatment that is delivered via telemedicine or telehealth.

See the entire text of Bulletin 20-07.

© 2020 Giordano, Halleran & Ciesla, P.C. All Rights Reserved

Health Law Section Report – September-December 2019

  • On September 16, 2019, at 51 N.J.R. 1462(a), the Department of Human Services, Division of Medical Assistance and Health Services, published an adoption of a correction to an error in the text of the definition of “nurse delegation” in the definitions set forth in N.J.A.C. 10:60-1.2. During the comment period, Disability Rights New Jersey (DRNJ) submitted a comment pertaining to the definition of nurse delegation. As part of the comment, DRNJ requested DMAHS to add “pursuant to N.J.A.C. 13:37-6.2” after “selected nursing tasks” to clarify what selected nursing tasks referred to (see Comment 16). DMAHS agreed to the change; however, in making the addition upon adoption, DMAHS inadvertently added the cross-reference as “N.J.A.C. 10:37-6.2.” The adoption corrects the error and inputs pursuant to N.J.A.C. 13:37-6.2.
  • On October 7, 2019, at 51 N.J.R. 1493(a), the Department of Human Services, Division of Medical Assistance and Health Services, published a rule proposal for a new chapter, N.J.A.C. 10:52B, to implement The County Option Hospital Fee Pilot Program. The purpose of the pilot program is to increase financial resources through the Medicaid/NJ FamilyCare program to support local hospitals in providing necessary services to low-income residents. The pilot program shall be in effect for a period of five years from April 30, 2019 and will end on April 30, 2024.
  • On October 7, 2019, at 51 N.J.R 1514(a), the Department of Law and Public Safety, Division of Consumer Affairs, Board of Medical Examiners, adopted an amendment to the athletic trainer continuing legal education requirement at N.J.A.C. 13:35-10.21, to require one credit in topics concerning prescription opioid drugs, including the risks and signs of opioid abuse, addiction, and diversion, commencing with the biennial renewal period beginning on February 1, 2019.
  • On October 7, 2019, at 51 N.J.R 1546(a), the Commissioner of the Department of Health published a notice of petition for rulemaking submitted by the New Jersey Hospital Association to make certain amendments to N.J.A.C. 8:43G Hospital Licensing Standards, Subchapter 14 Infection Control, N.J.A.C. 8:43G-14.9, Sepsis protocols, as recommended by CMS and the Surviving Sepsis Campaign, known as Sepsis-1.
  • On October 21, 2019 at 51 N.J.R. 1568(a), the Department of Law and Public Safety, Division of Consumer Affairs, Board of Physical Therapy Examiners, published a proposal to amend rules for supervision of licensed physical therapy assistants to clarify the record keeping regulations (N.J.A.C. 13:39A-7.2 and 7.3) in a manner that in the event patient records are maintained on computer recordkeeping systems that do not permit a supervising licensed physical therapist to sign a licensed physical therapist assistant’s notes, the supervising licensed physical therapist will be able to enter a separate note in the record indicating that he or she reviewed the licensed physical therapist assistant’s notes or the plan of care with the physical therapist assistant. This is meant to avoid a de facto dual signature requirement.
  • On November 4, 2019 at 51 N.J.R. 1597(a), the Department of Law and Public Safety, Division of Consumer Affairs, Board of Medical Examiners proposed amendments to its existing rules concerning graduate medical education programs in order to update the eligibility requirements for graduates of international medical schools who seek licensure or authorization to engage in the practice of medicine as residents. The proposed amendments would replace outdated restrictions on graduates of international medical schools pursuing licensure or authorization in New Jersey and allow the Board to rely on recognized accrediting bodies for international medical schools that adhere to standards substantially similar to the bodies that accredit domestic medical schools. By expanding eligibility, the proposed amendments may positively affect the supply of physicians practicing in the State. The proposal seeks to amend N.J.A.C. 13:35-1.5, 3.11, and 3.11A.
  • On November 4, 2019 at 51 N.J.R. 1600(a) the Department of Law and Public Safety, Division of Consumer Affairs, Audiology and Speech-Language Pathology Advisory Committee (Committee) proposes new rules to effectuate the provisions of the telemedicine and telehealth statute for licensed audiologists and/or speech-language pathologists. The proposed new rules would be codified at N.J.A.C. 13:44C-11.
  • On November 18, 2019, at 51 N.J.R. 1638(a), the Department of Law and Public Safety, Division of Consumer Affairs, State Board of Dentistry, proposed amendments, repeals, and new rules to: 1) implement new laws; 2) update rules, terminology, citations, website addresses, and the names of the licensure examinations; and 3) clarify and codify current standards of practice and licensure and registration requirements. The rulemaking reflects updates related to statutory changes, additions to enhance the safety of patients receiving dental services and those working in the profession, and identifies continuing education courses that must be completed in each renewal period. In response to adverse incident reports and news articles from across the country, the Board is proposing amendments to the sedation rules to enhance the safety of patients receiving dental services. Because the Board is seeing incidents of trained individuals achieving a deeper level of sedation than intended, the Board wants to provide more guidance to the regulated community as to what is expected so as to enhance patient safety. See N.J.A.C. 13:30. Comments due January 17, 2020.
  • On November 18, 2019, at 51 N.J.R. 1664(a), the Department of Law and Public Safety, Division of Consumer Affairs, State Acupuncture Examining Board (Board) proposed to amend N.J.A.C. 13:35-9.20 to require licensed acupuncturists to hold current certification in cardiopulmonary resuscitation (CPR), first aid, and the use of an automated external defibrillator (AED) as part of continuing education required to renew licensure. The certification must be from the American Heart Association, or a substantially similar course approved by the American Red Cross, National Safety Council, Coyne First Aid, Inc., American Safety and Health Institute, EMP International Inc., or EMS Safety Services Inc. In recognition of the hours required to obtain the certification, the Board proposes to reduce the number of required continuing education hours from 30 to 26. The Board is changing the total credits that could be obtained by certain methods to reflect that half of the total required hours will be 13 rather than 15. The Board also proposes to allow licensees who complete more than the continuing education hours required to renew licensure to apply those additional hours to the immediately succeeding biennial license renewal period. See N.J.A.C. 13:35-9.20.
  • On November 18, 2019, at 51 N.J.R. 1666(a), the Department of Law and Public Safety, Division of Consumer Affairs, Board of Massage and Bodywork Therapy proposed amendments that would require applicants for licensure and licensed massage and bodywork therapists to physically attend CPR, first aid, and use of an automated external defibrillator (AED) courses, would require licensed massage and bodywork therapists to complete continuing education in laws and rules pertinent to the practice of massage and bodywork therapy, and would end recognition of continuing education courses provided by schools, colleges, or universities. See N.J.A.C. 13:37A-2.1, 2.2, 2.3, 4.1, and 4.2.
  • On November 18, 2019, at 51 N.J.R. 1674(a), the Department of Law and Public Safety, Division of Consumer Affairs, State Board Of Marriage And Family Therapy Examiners, Art Therapists Advisory Committee adopted new rules at N.J.A.C. 13:34D requiring licensure of art therapists and providing rules governing licensed art therapists. The new rules require licensed art therapists to preserve the confidentiality of information obtained from a client in the course of professional treatment unless disclosure is required by Federal law and requires an art therapist whose client has explicitly waived the art therapist-client confidentiality privilege to release client information to a third-party payor whose benefit plan is qualified under the Federal Employee Retirement Income Security Act (ERISA). In addition, the new regulations provide that failure to comply with Federal laws related to the practice of art therapy will be deemed professional misconduct. See N.J.A.C. 13:34D.
  • On November 18, 2019, 51 N.J.R. 1688(a), the Department of Law and Public Safety, Division of Consumer Affairs, Board of Massage and Bodywork Therapy readopted rules with amendments, adopted repeals and new rules regarding licensure, reinstatement and reporting of misconduct, record keeping and business registration. See N.J.A.C. 3:37A.
  • On November 18, 2019, 51 N.J.R. 1691(a), the Department of Law and Public Safety, Division of Consumer Affairs, Orthotics and Prosthetics Board adopted a new rule regarding the abandonment of license applications due to incomplete information on the application or a one year lapse in submission of information requested by the Board. See N.J.A.C. 13:44H-3.5A.
  • On November 18, 2019, 51 N.J.R. 1691(b), the Department of Law and Public Safety, Division of Consumer Affairs, Orthotics and Prosthetics Board adopted a new rule to implement the telemedicine statute and to permit the use of telemedicine and telehealth by licensed orthotist, orthotist assistant, pedorthist, prosthetist, prosthetist assistant, prosthetist-orthotist, or prosthetist-orthotist assistant. See N.J.A.C. 13:44H-11.
  • On December 2, 2019, at 51 N.J.R. 1761(a), the Department of Law and Public Safety, Division of Consumer Affairs, State Board Of Marriage And Family Therapy Examiners, Alcohol & Drug Counselor Committee adopted amendments to the rules regarding who may provide clinical supervision to interns and counselors. See N.J.A.C. 13:34C-6.2, 6.2A, and 6.3.
  • On December 2, 2019, at 51 N.J.R. 1806(a), the Commissioner of the Department of Health published a notice of action on rulemaking by announcing that more time is required for deliberating on the adoption of new sepsis protocols for hospitals, as proposed on October 7, 2019 at 51 N.J.R 1546(a).
  • On December 16, 2019, at 51 N.J.R. 1841(a), the Department of Law and Public Safety, Division of Consumer Affairs, State Board of Physical Therapy Examiners proposed an amendment and new rule recognizing the provisions of the Compact privileges that would require physical therapists and physical therapist assistants working in New Jersey, under Compact privileges, to comply with Board rules, except for those governing credentialing of applicants, license renewal, and continuing education. The proposed amendment and new rule require those seeking to work in New Jersey, pursuant to Compact privileges, to pass the State jurisprudence examination and to pay the Compact privilege fee ($40).
  • On December 16, 2019, at 51 N.J.R. 1849(ab), the Department of Law and Public Safety, Division of Consumer Affairs, State Board of Medical Examiners adopted amendments to the rules regarding continuing medical education that would permit up to 10 hours volunteer medical service to uninsured low income patients to count towards the required CME requirement. See N.J.A.C. 13:35-6.15.

© 2020 Giordano, Halleran & Ciesla, P.C. All Rights Reserved

For more health care developments in New Jersey and other states, see the National Law Review Health Law & Managed Care section.

 

Telemedicine – Are There Increased Risks With Virtual Doctor Visits?

“Telemedicine” or “Telehealth” are the terms most often used when referring to clinical diagnosis and monitoring that is delivered by technology. Telemedicine encompasses healthcare provided via real time two-way video conferencing; file sharing, including transmission of health history, x-rays, films, or photos; remote patient monitoring; and consumer mobile health apps on smart phones, tablets, and devices that collect data and transmit it to a healthcare provider. Telemedicine is increasingly being used for everything from diagnosing common viruses to monitoring patients with serious long-term health issues.

The American Telemedicine Association reports that majority of hospitals now use some form of telemedicine. Two years ago, there were approximately 20 million telemedicine video consultations; that number is expected to increase to about 160 million by 2020. An estimated one-third of employer group plans already cover some type of telehealth.

Telemedicine implicates legal and regulatory issues as licensing, prescribing, credentialing, and cybersecurity. Pennsylvania recently passed legislation joining the Interstate Medical Licensing Compact, an agreement whereby licensed physicians can qualify to practice medicine across state lines within the Compact if they meet the eligibility requirements. The Compact enables physicians to obtain licenses to practice in multiple states, while strengthening public protection through the sharing of investigative and disciplinary information.

Federal and state laws and regulations may differ in their definitions and regulation of telemedicine. New Jersey recently passed legislation authorizing health care providers to engage in telemedicine and telehealth. The law establishes telemedicine practice standards, requirements for health care providers, and telehealth coverage requirements for various types of health insurance plans. Earlier this year, Texas became the last state to abolish the requirement that patient-physician relationships must first be established during an in-person patient/doctor visit before a telemedicine visit.

As telemedicine use increases, there will likely be an increase in related professional liability claims. One legal issue that arises in the context of telemedicine involves the standard of care that applies. The New Jersey statute states that the doctor is held to the same standard of care as applies to in-person settings. If that is not possible, the health care provider is required direct the patient to seek in-person care. However, the standard of care for telemedicine is neither clear nor uniform across the states.

Another issue that arises in the context of telemedicine is informed consent, especially in terms of communication, and keeping in mind that the Pennsylvania Supreme Court recently held that only the doctor, and not staff members, can obtain informed consent from patients. Miscommunication between a healthcare provider and patient is often an underlying cause of medical malpractice allegations in terms of whether informed consent was obtained.

In addition, equipment deficiencies or malfunctions can mask symptoms that would be evident during an in-person examination or result in the failure to transmit data accurately or timely, affecting the diagnosis or treatment of the patient.

Some of these issues will likely ultimately be addressed by legislative or regulatory bodies but others may end up in the courts. According to one medical malpractice insurer, claims relating to telemedicine have resulted from situations involving the remote reading of x-rays and fetal monitor strips by physicians, attempts to diagnose a patient via telemedicine, delays in treatment, and failure to order medication.

A recent Pennsylvania case illustrates how telemedicine may also impact the way medical malpractice claims are treated in the courts. In Pennsylvania, a medical malpractice lawsuit must be filed in the county where the alleged malpractice occurred. Transferring venue back to Philadelphia County, the Superior Court in Pennsylvania found that alleged medical malpractice occurred in Philadelphia — where the physician and staff failed to timely transmit the physician’s interpretation of an infant’s echocardiogram to the hospital in another county where the infant was being treated.

The use of telemedicine will likely have wide-reaching implications for health care and health care law, including medical malpractice.

This post was written by Michael C. Ksiazek of STARK & STARK, COPYRIGHT ©
2017
For more Health Care legal analysis, go to The National Law Review 

Practicing Telemedicine Across State Borders: New Expedited Licenses Permit Physicians to Expand Practice

In a watershed moment for the expansion of telemedicine, the Interstate Medical Licensure Compact Commission is now processing applications to allow physicians to practice telemedicine across state lines with greater ease. Nineteen states have passed legislation to adopt the Interstate Medical Licensure Compact, which allows physicians to obtain a license to practice medicine in any Compact state through a simplified application process.  Under the new system, participating state medical boards retain their licensing and disciplinary authority, but agree to share information essential to licensing, creating a streamlined process.

The Federation of State Medical Boards’ President and CEO, Humayun Chaudhry, DO, MACP, called the Compact a “milestone” for medical regulation in the United States.  “The launch of the Compact will empower interested and eligible physicians to deliver high-quality care across state lines to reach more patients in rural and underserved communities. This is a major win for patient safety and an achievement that will lessen the burden being felt nationwide as a result of our country’s physician shortage.”

States currently participating in the Compact are Idaho, Montana, Wyoming, Nevada, Arizona, Utah, Colorado, South Dakota, Kansas, Minnesota, Iowa, Wisconsin, Illinois, Mississippi, Alabama, West Virginia, Pennsylvania, New Hampshire, and Nebraska.  Seven additional states have proposed legislation to adopt the Compact, including Washington, D.C.

Most states require a physician to obtain a license to practice medicine in each state where the patient is located at the time of the physician-patient encounter.  Prior to adoption of the Compact, obtaining licensure in a given state was an oppressive task, requiring the physician to complete lengthy applications, submit required documentation, pay fees, and pass examinations.  This proved to be a burdensome restriction for physicians practicing telemedicine, where patients may be located in any state at the time of the physician-patient encounter.  Licensing requirements were identified as a significant barrier to the expansion of telemedicine, prompting introduction of the Compact.

Physicians are eligible to apply for the Compact license if they possess a full and unrestricted license to practice medicine in a Compact state and have not been disciplined by any state medical board, among other requirements.  To apply, the physician must designate a Compact state as the “state of principal licensure” and select the other Compact states in which they would like to become licensed.  The state of principal licensure will verify the physician’s eligibility and provide credential information to the Interstate Commission.  The Interstate Commission then collects applicable fees and transmits the physician’s information to the additional states, where the licenses will then be granted.

Participation in the Compact creates another pathway for licensure, but does not otherwise change a state’s existing Medical Practice Act.  Physicians located in a state that has not adopted the Compact may still obtain licensure in other states through the ordinary licensure process.

This post was written by Marki Stewart at Dickinson Wright PLLC.

Informed Consent and Health Information Security Essential: New American Medical Association Guidelines for Telemedicine

american medical associationOn June 13, 2016, the American Medical Association (AMA) approved new ethical guidelines pertaining to the appropriate use of audio-video technologies to connect with and treat patients remotely. Through these guidelines, the AMA advocates for greater use of telemedicine by physicians while concomitantly encouraging such providers to inform patients regarding the limitations of any technology, including explaining the capabilities and limitations of such services and documenting the same. Further, the new AMA guidance emphasizes the need for appropriate protocols to prevent unauthorized access and to protect the security and integrity of patient information obtained through telemedicine or disseminated to subsequent health care providers following a telemedicine encounter.

The new ethical guidelines will be codified in Opinion E-5.025, “Physician Advisory or Referral Services by Telecommunication,” and Opinion E-5.027, “Use of Health-Related Online Sites.” Through these guidelines, physicians who provide telemedicine services to patients remotely should:

(a) Inform prospective patients about the limitations of the telemedicine relationship and services.

(b) Advise prospective patients regarding the potential need for follow-up care as indicated.

(c) Encourage patients who have existing primary care providers to inform such physicians about the patient’s receipt of telemedicine consultations and services, even if subsequent in-person care is not immediately needed.

(d) Be proficient in the use of relevant technologies.

(e) Recognize the limitations of such technologies and take appropriately steps to overcome or address any such limitations.

(f) Prudently perform appropriate diagnostic evaluations or prescribe medications by:

  • Establishing the patient’s identity;
  • Confirming that the telemedicine services are appropriate for that patient’s individual situation and medical needs;
  • Evaluating the indication, appropriateness and safety of any prescriptive medication in accordance with best practices and state prescriptive formularies; and
  • Sufficiently documenting the clinical evaluation and prescription and a medical record.

(g) Obtain an appropriately documented informed consent regarding the distinctive features of telemedicine in addition to information regarding the specific medical issues and treatment options.

(h) Take appropriate steps to preserve continuity of care, including giving consideration to the preservation of information and accessibility of such information for subsequent providers.

In addition to disseminating the above guidelines – violation of which could expose a physician to professional licensure sanction by state licensing boards – the AMA is encouraging physicians to collectively advocate for the access of telehealth and telemedicine services for all patients who could benefit from receiving care electronically. The AMA is similarly advocating for professional organizations and institutions to monitor telehealth and telemedicine developments to identify and proactively address both positive and negative outcomes to bring about further improvement in such technologies.

In light of the AMA’s advocacy of telehealth and telemedicine, such support could lead to relaxed restrictions on physician’s use of such technology to treat patients remotely and encourage greater levels of reimbursement by Medicare, Medicaid and private insurers for such treatment. Nonetheless, physicians should recognize that their fundamental duties to ensure patient safety and quality of care are not lessened when providing services via telehealth and telemedicine. Moreover, physicians should also be cognizant that the AMA guidelines do not supersede or displace state laws pertaining to telehealth and telemedicine; rather, the guidelines complement such regulations.

ARTICLE BY Daniel S. Zinsmaster of Dinsmore & Shohl LLP
© 2016 Dinsmore & Shohl LLP. All rights reserved.

Ohio Following National Trend in Clarifying Permissible Telemedicine Activities

On April 15, 2016, the State Medical Board of Ohio (Ohio Board) released proposed rules outlining the requirements for practitioners to prescribe or cause a prescription drug to be provided to a person who is at a location remote from the practitioner and for whom the practitioner has never conducted a physical examination. The proposed rules were a result of Ohio Revised Code Section 4731.74, enacted March 23, 2016, which tasked the Ohio Board with developing clear standards for practitioners who treat patients through telemedicine platforms. The proposed rules will replace Ohio Administrative Code Rule 4731-11-09.

Ohio defines “the practice of telemedicine” as “the practice of medicine in this state through the use of any communication, including oral, written, or electronic communication, by a physician located outside of this state.”i While this definition only references physicians, the Ohio Board has indicated that the proposed rule will also be applicable to podiatrists and physician assistants who have prescriptive authority. Any practitioner who treats a patient located in Ohio through telemedicine must be licensed by the Ohio Board or possessing a limited Ohio telemedicine certificate issued by the Ohio Board.

With regard to non-controlled substances, the proposed rules will authorize a practitioner to establish a practitioner-patient relationship by the use of appropriate technology in a manner consistent with the minimal standard of care for in-person treatment by a practitioner. This encompasses a medical evaluation and the collection of relevant clinical history as needed to establish a diagnosis, identify any underlying conditions, and identify any contraindications to the treatment recommended or provided. This information must be documented in the patient’s medical record along with confirmation of the patient’s identity, the patient’s physical location, and the patient’s informed consent for treatment through remote examination.

In accordance with the proposed rules, controlled substances may only be prescribed by a practitioner who has met the steps outlined above for authorizing non-controlled substances and one of the following situations exists:

  • The person is an “active patient” of a health care provider who is a colleague of the practitioner and the controlled substances are provided through an on call or cross coverage arrangement between the health care providers. Note that “active patient” means that within the previous 24 months, the practitioner conducted at least one in-person medical evaluation.

  • The person has been admitted as an inpatient or resident of an institutional facility such as a hospital, nursing home, or psychiatric facility.

  • The practitioner is appropriately engaged in the practice of telemedicine as defined in 21 C.F.R. 1300.04.

The Ohio Board’s proposed rules follow similar recent developments from other state licensing agencies, including Indiana, West Virginia and Washington State. The Ohio Board is accepting comments regarding the intended regulations through Thursday, May 12, 2016. For more information on the proposed rules and/or submitting comments about the rules, please contact a Dinsmore health care attorney.

Article By Daniel S. Zinsmaster & Jenna Moran ofDinsmore & Shohl LLP

© 2016 Dinsmore & Shohl LLP. All rights reserved.

1 Ohio Revised Code Section 4731.296.

Five Telemedicine Trends Transforming Health Care in 2016

Telemedicine is a key component in the health care industry shift to value-based care as a way to generate additional revenue, cut costs and enhance patient satisfaction. One of the biggest changes to health care in the last decade, telemedicine is experiencing rapid growth and deployment across a variety of applications.

The quick market adoption of telemedicine is fueled by powerful economic, social, and political forces — most notably, the growing consumer demand for more affordable and accessible care. These forces are pushing health care providers to grow and adapt their business models to the new health care marketplace.

Simultaneously changing is the misconception that telemedicine creates a financial strain or relies on grant funding. Smart health system leadership are creating sustainable telemedicine arrangements that generate revenue, not just cost savings, while improving patient care and satisfaction. Research conducted by the American Telemedicine Association reveals that telemedicine saves money for patients, providers, and payers compared to traditional health care practices, particularly by helping reduce the frequency and duration of hospital visits.

It is expected that the global telemedicine market will expand at a compound annual growth rate of 14.3 percent through 2020, eventually reaching $36.2 billion, as compared to $14.3 billion in 2014. And while the growing demand for convenience, innovation, and a personalized health care experience may be the greatest factor, other forces are at work as well.

These five trends will drive telemedicine’s continued growth and transformation of health care delivery in 2016:

1. Expanding Reimbursement and Payment Opportunities

Both private and government payers will continue to expand telemedicine coverage as consumers gain experience with the technology and increasingly demand access to telemedicine-based services. Some health plans have already begun bolstering their coverage of telemedicine, which they view as a form of value-based care that can improve the patient experience and offer substantial cost savings. On the government side, 2016 will particularly see more coverage among Medicaid managed care organizations and Medicare Advantage plans.

While reimbursement was the primary obstacle to telemedicine implementation, new laws requiring coverage of telemedicine-based services have been implemented at the state level, and 2016 will be the year these laws drive implementation in those states. Similarly, providers are becoming increasingly receptive to exploring payment models beyond fee-for-service reimbursement, and 2016 will continue the growth of these arrangements. Examples include institution-to-institution contracts and greater willingness by patients to pay out-of-pocket for these convenient, valuable services.

2. Uptick in International Arrangements

In 2016, more U.S. hospitals and health care providers will forge ties with overseas medical institutions, spreading U.S. health care expertise abroad. These cross-border partnerships will provide access to more patients, create additional revenue and help bolster international brands. According to the American Telemedicine Association, more than 200 academic medical centers in the U.S. already offer video-based consulting in other parts of the world. While many of these are pilot programs, 2016 will see a maturation and commercialization of much of these international arrangements, as they are a win-win for participants in both countries.

The growing purchasing power of middle-class populations in countries like China is giving more patients the means and opportunity to pursue treatment from Western medical centers. We have seen both for-profit and non-profit models for international telemedicine — hospitals partnering with organizations in the developing world to expand health care availability or offering commercial care to customers in nations with areas of concentrated wealth but lacking the capabilities and access of Western health care.

3. Continued Momentum at the State Level

State governments across the U.S. are leading the way in telemedicine expansion. According to a study by the Center for Connected Health Policy, during the 2015 legislative session, more than 200 pieces of telemedicine-related legislation were introduced in 42 states. Currently, 29 states and the District of Columbia have enacted laws requiring that health plans cover telemedicine services. In 2016, we will see more bills supporting health insurance coverage for telemedicine-based services introduced in various state legislatures.

While state lawmakers are leading the way in incorporating telemedicine into the health care system, two recent developments point to a burgeoning interest at the federal level. The Centers for Medicare and Medicaid Services (CMS) is considering expansion of Medicare coverage for telemedicine, and a bill working its way through the U.S. House of Representatives would pay physicians for delivering telemedicine services to Medicare beneficiaries in any location.

4. Retail Clinics and Employer Onsite Health Centers on the Rise

A recent Towers Watson study found that more than 35 percent of employers with onsite health facilities offer telemedicine services, and another 12 percent plan to add these services in the next two years. Other studies suggest that nearly 70 percent of employers will offer telemedicine services as an employee benefit by 2017. The growth of nation-spanning telemedicine companies such as MDLIVE and the now publicly-traded Teladoc, which offer health services tailored to the specific needs of employers and other groups, is a reflection of the demand for these services.

Additionally, consumers are increasingly willing to visit retail medical clinics and pay out-of-pocket for the convenience and multiple benefits of telemedicine services when telemedicine is not covered by their insurance plans. Both CVS Health and Walgreens have publicly announced plans to incorporate telemedicine-based service components in their brick and mortar locations.

5. More ACOs Using Technology to Improve Care and Cut Costs

2016 will be the year of telemedicine and ACOs. Since the advent of Medicare Accountable Care Organizations (ACOs), the number of Medicare beneficiaries served has consistently grown from year to year, and early indications suggest the number of beneficiaries served by ACOs is likely to continue to increase in 2016. These organizations present an ideal avenue for the growth of telemedicine.

While CMS offers heavy cost-reduction incentives in the form of shared-saving payments, only 27 percent of ACOs achieved enough savings to qualify for those incentives last year. Meanwhile, only 20 percent of ACOs use telemedicine services, according to a recent study. We believe the widespread need to hit the incentive payment metrics, coupled with the low adoption rate will lead to significantly greater telemedicine use among ACOs in 2016.

Article By Nathaniel M. Lacktman of Foley & Lardner LLP
© 2015 Foley & Lardner LLP