March 27, 2023
By: Stephanie Sprague Sobkowiak
President Biden announced that the COVID-19 national emergency and public health emergency (PHE) will expire on May 11, 2023. During the PHE, federal agencies were permitted to grant blanket waivers for certain health care activities and to use their discretion in enforcing federal laws, including the Health Insurance Portability and Accountability Act of 1996 (HIPAA) and the physician self-referral law (Stark Law). Upon the expiration of the PHE, many of the flexibilities and waivers that were issued by the federal agencies will expire, and we expect that the agencies will begin to enforce federal laws as they did prior to COVID-19.
Compliance with HIPAA
In March 2020, and in response to the PHE, the Office for Civil Rights (OCR) issued a Telehealth Notification aimed at helping providers expand the use of remote health care services. The Telehealth Notification stated that OCR would exercise its enforcement discretion and would not impose penalties on health care providers for noncompliance with the requirements of the HIPAA Rules in connection with the good faith provision of telehealth using non-public facing audio or video remote communication technologies during the PHE.
With the conclusion of the PHE approaching, OCR issued reader-friendly guidance to covered entities regarding compliance with HIPAA Rules when OCR’s Telehealth Notification is no longer in effect. The guidance specifically addresses the following questions:
- Does the HIPAA Privacy Rule permit health care providers to use remote communication technologies to provide audio-only telehealth services?
- Do health care providers have to meet the requirements of the HIPAA Security Rule in order to use remote communication technologies to provide audio-only telehealth services?
- Do the HIPAA Rules permit a health care provider to conduct audio-only telehealth services using remote communication technologies without a business associate agreement in place with the vendor?
- Do the HIPAA Rules allow health care providers to use remote communication technologies to provide audio-only telehealth services if an individual’s health plan does not provide coverage or payment for those services?
Health care providers, in preparation for the end of the PHE, should review the guidance issued by OCR to ensure that their telehealth policies will be compliant following May 11, 2023.
Compliance with the Stark Law
In March of 2020, the Department of Health & Human Services (HHS) released guidance titled “Blanket Waivers of Section 1877(g) of the Social Security Act Due to Declaration of COVID-19 Outbreak in the United States as a National Emergency” (Waivers Guidance). Section 1877 of the Social Security Act, also known as the Stark Law, prohibits a physician from making referrals for certain designated health services (DHS) payable by Medicare to an entity with which he or she has a financial relationship, unless all of the requirements of an applicable exception are satisfied and prohibits the entity from filing Medicare claims for DHS furnished pursuant to a prohibited referral.
The blanket waivers, which apply to only financial relationships and referrals that are related to COVID-19, permit health care providers to submit claims for DHS that would otherwise violate the Stark Law. In its Waivers Guidance, HHS provided a list of blanket waivers which includes, among others:
- Remuneration from an entity to a physician that is above or below fair market value for services personally performed by the physician.
- Rental charges paid by an entity to a physician that are below fair market value for the entity’s lease of office space from the physician.
- The referral by a physician to an entity with which the physician’s immediate family member has a financial relationship if the patient who is referred resides in a rural area.
- Referrals by a physician to an entity with whom the physician has a compensation arrangement that does not satisfy the writing or signature requirement(s) of an applicable exception but satisfies each other requirement of the exception.
HHS also provided examples of conduct that may fall within the scope of the blanket waivers as set forth above. These examples include:
- A hospital pays physicians above their previously contracted rate for furnishing professional services for COVID-19 patients in particularly hazardous or challenging environments.
- To accommodate patient surge, a hospital rents office space or equipment from an independent physician practice at below fair market value or at no charge.
- A hospital’s employed physicians use the medical office space and supplies of independent physicians in order to treat patients who are not suspected of exposure to COVID-19 away from their usual medical office space on the campus of the hospital in order to isolate patients suspected of COVID-19 exposure.
- A hospital or home health agency purchases items or supplies from a physician practice at below fair market value or receives such items or supplies at no charge.
- A hospital provides free use of medical office space on its campus to allow physicians to provide timely and convenient services to patients who come to the hospital but do not need inpatient care.
- An entity provides free telehealth equipment to a physician practice to facilitate telehealth visits for patients who are observing social distancing or in isolation or quarantine.
For more examples of blanket waivers and a more extensive list of examples of conduct that may fall within the scope of the blanket waivers, see the HHS Guidance.
Following May 11, 2023, the blanket waivers of the Stark Law will no longer be in effect. Health care providers should review any financial arrangements they entered into because of the COVID-19 emergency and ensure that, if necessary, they fall within one of the Stark Law exceptions. Further, if a health care provider believes that any financial arrangement made during the PHE satisfies a blanket waiver, the health care provider should retain sufficient documentation relating to such waiver in case HHS conducts an audit or requests such documentation.
For more details regarding the end of the PHE and implications on health care providers, please contact: Stephanie Sprague Sobkowiak at 203.772.7782 or ssobkowiak@murthalaw.com
Arielle M. Smitt at 203.772.7738 or asmitt@murthalaw.com
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