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Provider-Based Update: Congress Offers Encouraging Step to Reduce Scope of BBA Reimbursement Reductions

On Wednesday, members of the House Ways and Means Health Subcommittee introduced bipartisan legislation that would provide some welcome relief to hospitals who had already invested resources to develop new provider-based departments when Section 603 of the Bipartisan Budget Act (BBA) was enacted on Nov. 2, 2015.

Specifically, H.R. 5273 includes a proposed “mid-build” exception that would grandfather in a department if the hospital had already signed a “binding written agreement with an outside unrelated party for the actual construction of such department” prior to Nov. 2, 2015.

Under the proposal, departments that meet the mid-build exception would be exempt from the BBA reimbursement reductions. We believe this proposal would also improve the likelihood that a hospital’s 340B Drug Pricing Program eligibility would be extended to these departments. A summary of the legislation can be found here.

Although it is unclear whether this proposed legislation will be enacted, there are few remaining legislative days in Congress. While there is no current Senate companion bill, House action may spur the Senate to act prior to the end of the year. The House Ways and Means Committee is now scheduled to mark up the bill today at 2:00 p.m. This is an encouraging step in the right direction and reflects a bipartisan effort to reduce the scope of the BBA reimbursement reductions.

Additionally, 51 senators issued a letter to CMS on Thursday requesting that CMS includes “flexibilities to enable hospitals to continue to serve patients in [provider-based] settings as well as provide predictability for the hospital field” when drafting its regulations that implement the BBA site neutral payment reductions. The letter specifically recommends that CMS does not apply site neutral payment reductions to existing hospital outpatient departments that relocate, rebuild or change ownership.

© Polsinelli PC, Polsinelli LLP in CaliforniaNational Law Review, Volume VI, Number 145

TRENDING LEGAL ANALYSIS


About this Author

Julius W. Hobson, Jr., Polsinelli PC, Public Policy Attorney, Long Term Care Regulation Lawyer,
Senior Policy Adviser

Julius W. Hobson, Jr., strives to meet client public policy goals and objectives based upon the client needs and capabilities. Julius has more than 40 years’ experience in public policy, working both inside and outside of government. He has a deep-rooted understanding and compassion about the public policy process — both legislative and administrative. He primarily serves health care clients with particular emphasis on physicians, hospitals, home health, and long-term care providers. 

202.626.8354
Ross E. Sallade, Polsinelli PC, Medicare Enrollment Lawyer, Diligence Reports Attorney
Shareholder

Ross Sallade provides value to clients by tackling the complex legal regulatory, operational, reimbursement and enrollment matters that others might be reluctant to handle. Ross does so by drawing upon specialized knowledge for each matter which enables him to quickly evaluate urgent issues and provide practical recommendations. He also leverages a unique skill set that enables him to identify and work with the right federal and state regulators to pinpoint the heart of the issue and make recommendations to reach appropriate resolution. His previous experience strengthens his ability to provide counsel rooted in an understanding of not only the law, but also how legal issues or regulatory changes can impact clients’ business goals.

Ross works with clients to help them navigate through the myriad of state and federal health care regulatory challenges facing them. He regularly counsels clients to aid in structuring their business transactions and relationships in compliance with federal and state regulations, including change of ownership requirements, as well as federal anti-kickback statute and federal physician self-referral (or “Stark”) laws.

919.832.1718
Kyle A. Vasquez, Polsinelli, Compliance Support Lawyer, Health Care Reform Attorney
Counsel

Kyle Vasquez provides pragmatic legal and compliance support to a wide range of health care clients. He utilizes his background in health law and his prior experience as a health care consultant to develop creative approaches that address the unique challenges that health care providers face. Kyle works collaboratively with health care stakeholders to assist in identifying forward-thinking models that meet their financial and operational needs. Kyle represents a broad set of health care entities including multi-hospital health systems, community hospitals, FQHCs,...

312.463.6338
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Colleen Faddick's practice includes advising clients regarding the structure of and relationships among health care providers and entities within the complex federal and state regulatory environment. Colleen focuses on Medicare and Medicaid reimbursement and enrollment issues and appeals, fraud and abuse and self-referral law issues, licensing and certification of health care entities, clinical trial compliance and agreements for sponsors and providers, medical device payment and manufacturer relationships with physicians. Colleen works with hospitals, large physician...

303.583.8201
Bragg E. Hemme, Polsinelli PC, Medical Licensure Lawyer, State Hospital Regulatory Attorney
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In order to assist health care clients address their targeted business concerns, Bragg Hemme draws on a wealth of practical experience and a solid understanding of the industry gained during her time as both external and internal counsel. Her experience includes advising clients regarding the complex and ever-changing federal and state regulatory environment. She focuses her practice on government payer concerns such as:

  • Medicare, Medicare advantage and Medicaid reimbursement

  • Enrollment issues and...

303.583.8232