Health Care E-Note January 2022

Articles / Publications


The Federal No Surprises Act

The Federal No Surprises Act (the "Act") became fully effective on January 1, 2022. The Act protects enrollees in group and individual market plans (including ERISA plans) and federal employee health benefits plans from surprise billing for:

  • Emergency services provided by non-participating provider and/or non-participating emergency facilities, and
  • Non-emergency services provided by a non-participating provider at a participating health care facility

The Act precludes out-of-network providers from billing patients for more than the in-network cost-sharing price. In addition, the Act provides a mechanism for setting payment for protective out-of-network services and a process for resolving related disputes. Finally, it requires certain disclosures by providers and facilities as well as plans and issuers who are relevant.

When applying the Act, the operative terminology is whether or not a provider or facility is participating or non-participating and/or emergency or non-emergency. With respect to facilities, the Act is very specific as to which types of health care facilities are “participating”. The list is limited to four: 1) hospital; 2) hospital out-patient department; 3) critical access hospital, and 4) ambulatory surgery center. No other health care facilities are identified. Although the statute does authorize the departments (i.e., the Department of Labor, Department of the Treasury and the Department of Health and Human Services) to designate other types of health care facilities as a “participating health care facility”, so far it has not done so. Thus, unless a specific facility is one of the four listed above, it is non-participating and the Act would not apply to that facility.

Outside of participating facilities, the Act is more focused on non-participating providers. A non-participating provider is simply a provider who is an out-of-network provider. Thus, if an out-of-network provider (and, therefore, a non-participating provider) provides services to a covered patient he or she must comply with the Act. While there is a mechanism to determine what the non-participating provider should be paid, that mechanism can be cumbersome. So far, the consensus seems to be that the payment amount will be approximately the median between what an in-network provider is paid and the normal payment for the out-of-network provider.

The above is but a brief summary of the Act and individual situations obviously will require more individualized scrutiny. The penalties can be harsh so practitioners are certainly advised to address the requirements of the Act if there is any question as to its applicability.

Sources: Interim Final Rule, Federal Register/Vol. 86 No. 131/Tuesday July 13, 2021; Second Interim Final Rule, Federal Register/Vol. 86, No. 192/Thursday, October 7, 2021; Third Interim Final Rule, Federal Register/Vol. 86, No. 223/Tuesday, November 23, 2021

The Mental Health Parity and Addiction Equity Act of 2008

The Mental Health Parity and Addiction Equity Act (the “Act”) was passed by Congress in 2008 to place mental health and substance use disorder benefits on a level playing field with medical and surgical benefits. To do so, the Act prohibits ERISA–covered health plans from imposing treatment limitations on mental and substance use disorder benefits that are more restrictive than the treatment limitations they impose on medical/surgical benefits.

The purpose of the Act was well illustrated in a recent action brought by the United States Secretary of Labor, Martin J. Walsh, in the Eastern District of New York. In that action, the Secretary sued two affiliates of United Health (United Behavioral Health and United Healthcare Insurance Company) alleging they established policies and procedures, and adjudicated claims, for benefits in a way that caused the ERISA-covered health plans they administered to systematically reimburse participants and beneficiaries for out-of-network mental health services in a more restrictive manner than they reimbursed them for out-of-network medical and surgical services. The upshot, according to the Department of Labor, was the unlawful denial of coverage of thousands of patients seeking mental health and substance use disorder treatment.

The case was quickly settled with United agreeing to pay, among other things, $10 million to a Tiered Reimbursement Settlement Fund and also agreeing to post on its website notice of the settlement and its terms. But the settlement also sent a clear message to covered payors: comply with the Act or face rigid government enforcement.

Sources: Mental Health Parity and Addiction Act of 2008, 29 U.S.C. § 1185a; Walsh v. United Behavioral Health and United Health Care Insurance Company, Civil Action No. 1:21-CV-04533 (filed August 11, 2021)

OIG Advisory Opinion No. 22-01: A “Facts and Circumstances” Paradigm

In this Advisory Opinion (posted January 19, 2022) the Office of Inspector General provided the health care and legal communities with an excellent example of why some arrangements that appear questionable on their face are, nonetheless, not sanctionable even though the arrangement does not meet any of the safe harbors to the Federal Anti-Kickback Statute (AKS). In rendering its opinion, the OIG illustrated in careful detail how it analyzes the facts and circumstances of a proposed arrangement to determine level of risk of fraud and abuse under the AKS.

Briefly, the Requestors operated a retail discount business offered to low-income individuals. The Requestors proposed to add an additional category of eligibility for their discount programs which included enrollment in Medicaid. In their request, the Requestors made several important certifications obviously designed to avoid abuse of the Medicaid program.

The OIG concluded that although the arrangement would generate remuneration that, technically, is prohibited, it would not impose sanctions. In doing so, it discussed five separate reasons for its opinion, all of which militated against the existence of the fraudulent intent which the AKS requires. The OIG’s opinion also pointed out the benefits the proposed arrangement would provide to Medicaid beneficiaries. Taken together, the program protections and the corresponding benefits convinced the OIG the proposed arrangement could move forward without fear of sanction. But, as always, its opinion was limited to the specific facts and circumstances described by the Requestors.

Like the proposed arrangement described in Advisory Opinion 20-01, many health care “arrangements” do not meet the requirements of the AKS safe harbors. Similarly, many do not warrant the time and expense of seeking an advisory opinion from the Office of Inspector General. Thus, Advisory Opinion No. 22-01 provides an excellent analytical framework to apply to those arrangements in determining the risk of going forward with them.

Source: OIG Advisory Opinion No. 22-01

Health Care Fraud and COVID-19

South Florida has, historically, been a hotbed for health care fraud. And the current pandemic has not slowed that pattern down. Indeed, in one recent case health care fraud and COVID became not so strange bed fellows.

Christopher Licata, the owner of Boca Toxicology LLC (dba Lab Dynamics), thought he could exploit the pandemic by bundling COVID-19 testing with other forms of testing that patients did not need and get paid handsomely by Medicare for it.

Earlier this month Licata entered a guilty plea to one count of conspiring to commit health care fraud. In pleading guilty, Licata admitted that he had bribed patient brokers who would then refer Medicare beneficiaries and physician orders authorizing medically unnecessary genetic testing to his laboratory. Sham agreements were set up to disguise the true purpose of the payments for the tests. But once the COVID-19 pandemic began, he then exploited patients’ fears by bundling the COVID-19 tests with medically unnecessary, but more expensive, testing. Over time, his lab submitted almost $7 million in false and fraudulent claims to Medicare.

Licata is scheduled to be sentenced on March 24, 2022 and faces up to 10 years in prison for his pandemic motivated scheme.

Source:  Plea Agreement, Agreed Factual Basis for Guilty Plea, Department of Justice Press Release Number: 22-33

For more information on these "Helpful Hints" topics, please contact Robert V. Williams in our Tampa, FL office at (813) 367-5712 or


U.S. Supreme Court Dissolves Injunction of CMS Vaccine Rule

On January 13, 2022, the United States Supreme Court, in a 5 to 4 vote, granted the government’s request to overturn the injunction on The Centers for Medicare and Medicaid ("CMS") interim final rule requiring vaccinations of employees at certain Medicare and Medicaid-certified facilities. Federal courts had enjoined the rule in 26 states, while the remaining states were subject to enforcement as of January 27, 2022. CMS issued guidance on the Interim Final Rule ("IFR") on December 28, 2021, mandating the vaccine in health care settings in those states not covered by the injunction.

As a result of the Court’s ruling, Medicare and Medicaid-certified facilities must comply with the vaccine mandate. CMS issued another QSO memo setting forth deadlines for Alabama, Alaska, Arizona, Arkansas, Georgia, Idaho, Indiana, Iowa, Kansas, Kentucky, Louisiana, Mississippi, Missouri, Montana, Nebraska, New Hampshire, North Dakota, Ohio, Oklahoma, South Carolina, South Dakota, Utah, West Virginia and Wyoming. The current deadlines outlined in the CMS guidance requires compliance with Phase 1 of having received at least one dose of a COVID-19 vaccine by Monday, February 14, 2022, and completion of a primary vaccine series (one shot of a single dose vaccine or last shot of a multi-dose vaccine) by March 15, 2022. The federal courts of appeal will now take up the matter on the merits but enforcement is not stayed in the meantime.

The guidance on enforcing the CMS vaccine mandate can be found here and here.

Written by Angie Cameron Smith. Contact Angie at (205) 458-5209 or


Supreme Court Blocks OSHA’s Emergency Temporary Standard for Employee COVID-19 Vaccination and Testing

After more than two months of litigation, the Supreme Court stayed OSHA’s November 5, 2021 Emergency Temporary Standard requiring COVID-19 vaccination or weekly testing for employers with more than 100 employees. On January 13, 2022, the Supreme Court, in an unsigned 6-3 per curiam decision, stayed the Occupational Safety and Health Administration’s (“OSHA”) COVID-19 Vaccination and Testing Emergency Temporary Standard (“ETS”). The Court found those challenging the ETS were likely to succeed on the merits of their claim that OSHA lacked authority to impose the mandate because OSHA only has statutory authority to set workplace safety standards, not broad public health measures.

Read more here.

Written by Amy Jordan Wilkes. Contact Amy at (205) 458-5358 or

Birmingham Medical News: Sweeping Medical Record Changes Proposed for Alabama Physicians

The Alabama State Board of Medical Examiners and the Alabama Licensure Commission have proposed a complete overhaul of the rules affecting medical record management by Alabama physicians (the “Proposed Rule”). Currently, there are few state guidelines with respect to medical record access, copying and patient notification, which often leads to disputes when a physician leaves a medical practice. The Proposed Rule establishes for the first time detailed requirements for accessing, retaining and disposing of patient medical records, as well as patient notification of a change in physician status.

Read the full article here.

Written by Howard E. Bogard and published in the December 2021 issue of Birmingham Medical News. Howard may be reached at (205) 458-5416 or

Jim Hoover Discusses Employment Issues for Providers Giving Staff Medical Advice for Part B News

In a December 13, 2021 article in Part B News, Jim Hoover shared insight on legal considerations for health care providers when an employee asks a physician for medical advice. “It may create a reason for an employee to charge discrimination under the Americans with Disabilities Act (ADA),” Hoover said. For example, if an employee discusses his alcoholism with a doctor, and the doctor later tries to fire the employee for work issues that may be related to his drinking problem, the employee may claim the office needs to provide him with a reasonable accommodation under the ADA for the alcoholic disability that the doctor is clearly aware he suffers from.

For the full article, you may access a PDF here. Alternatively, Part B News subscribers may access the article here.

Written by James A. Hoover. Contact Jim at (205) 458-5111 or

Data Breach Notification Laws in the United States: What Is Required and How Is that Determined?

Has your business considered what obligations you would have to notify people in the event of a cyber-attack that compromises some or all of your IT systems? Have you cataloged all the data you collect and where it is stored so that you can determine whose information is impacted by a breach? If not, you are certainly not alone. With the continuing increase in cyber-attacks and particularly ransomware, combined with laws that are imposing shorter and shorter notice deadlines, it is important for all businesses to understand the scope of their potential notification obligations in the event they fall victim to an attack.

Read the full article here.

Written by India E. Vincent, CIPP/US. Contact India at (205) 458-5284 or

COVID-19 as a Disability Under the Americans with Disabilities Act

Can COVID-19 be Considered a Disability? The EEOC recently published guidance indicating that, in some instances, COVID-19 may be considered a disability under the Americans with Disabilities Act (“ADA”). Although the definition of “disability” is construed broadly in favor of coverage, not every COVID-19 case will qualify as a disability. The ADA requires a case-by-case approach to make this determination.

How Does the ADA Define Disability? The ADA specifies that a person may be an individual with a disability in one of three ways: 1) the person has an “actual” disability; 2) the person has a “record of” a disability; or 3) the person is “regarded as” an individual with a disability.

Read the full article here.

Written by Amy Jordan Wilkes. Contact Amy at (205) 458-5358 or

Leading Through the Storm - Alabama MGMA 2022 Winter Conference - March 2-4, 2022

Howard E. Bogard, Kelli Carpenter Fleming, and Matthew T. Scully will join hundreds of medical group managers in Birmingham at this year's Alabama MGMA Winter Conference. They will be speaking at three breakout sessions March 2nd and 3rd on employment law issues post COVID, private equity and the physicians practice, and an update on medical records privacy and security. To view the agenda, click here. Howard, Kelli, and Matt hope to see you there.

WEBINAR RECORDING - The Burr Morning Show: Employee Handbooks in a COVID World

On the December 10, 2021, Burr Morning Show Webinar, panelists Nafela Hojeij Helou and Jon M. Gumbel discussed vaccines and other critical policies that should be reviewed moving into 2022. View the recording here.


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Burr & Forman's experienced team helps clients navigate the complex cybersecurity and data privacy landscape with strategies designed to assess current risks, develop a corrective action plan, implement best practices, and provide immediate and appropriate responses to a cybersecurity breach.

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