The opportunities to use technology to provide healthcare services seem to be growing as fast as technology itself. This is especially true in the area of care being provided by a “remote” provider. In fact, an AMA study released in May 2019 indicated that telehealth was the fastest growing “place of care” in the country, outpacing urgent care centers, retail clinics, and ambulatory surgery centers. Unfortunately, the laws governing telehealth have not always kept up with the pace of that growth, and questions remained about how it could be provided in Florida. However, the Florida legislature did something about that this year, by passing House Bill 23, which Governor Ron DeSantis signed into law on June 25, 2019. The act, which is primarily codified in Florida Statutes §456.47, took effect on July 1, 2019 and answers many outstanding questions. These questions are addressed below.
Constitutes Telehealth in Florida and Who can Practice It?
The new law sets out a straightforward, and broad, definition of telehealth. Basically, telehealth in Florida is the use of telecommunication technology by a telehealth provider to provide healthcare services. These services can include assessment, diagnosis, consultation, treatment, monitoring, transfer of medical data, education, public health services and health administration. Voice-only telephone calls, emails and faxes are specifically excluded from the definition. Obviously those activities are still permissible, but they fall outside the definition.
Healthcare fraud abuse comes in a variety of shapes and sizes, ranging from the simple filing of a false Medicare claim to grand schemes arranging kickbacks (i.e., payment by one party to another for having referred business or otherwise produced income for the payer). Similarly, the typical conception of “culpability” for the commission of healthcare related criminal acts varies dramatically across a variety of Federal criminal statutes enacted to protect against fraud.
For instance, one may be criminally liable under the Federal Anti-Kickback provisions for receiving benefits “directly or indirectly”, “overtly or covertly”, and “in cash or in kind”. Accordingly, although knowledge of receipt of benefit is a necessary element, the Government may seek a conviction even where “indirect” “non-cash” benefits are received. Along the same lines, Federal healthcare laws are comprised of more than merely criminal statutes, which provide a harsh deterrent to fraud and ensure legal compliance. Federal law also provides a complex framework of civil protection (under statutes such as the False Claims Act) and administrative penalties (such as suspension of licensure) to supplement the criminal provisions effecting healthcare fraud and administration.
There’s an old saying that goes like this: To a hammer, everything is a nail. There’s another I like: There are two things in life you don’t wanna see being made: one is sausage, the other is law. Case in point is HB 369, the latest Florida law aimed at correcting certain problems in the addiction treatment industry. Though nailing some clear issues that needed shoring up, some of the provisions skate on some questionably thin ice vis a vis conflicting with federal law.
The law implemented last year is a mixed bag. This one is no different, and yet in many ways more of a modification of last year’s legislative bombshell than anything else. Some of the good stuff that the law does includes: doubling down on the credentials required to work in a recovery center. For instance, the definitions of “clinical supervisor” and “peer specialist” are both beefed up to require, for instance, a length of time of sobriety. And background checks for people working at treatment centers are featured strongly in the new law. The law also creates an exemption from disqualification for certain past offenses, which is important when qualifying people to help those in treatment who likely had a past history of abusing drugs or alcohol. The law also attempts to negate old landlord tenant laws to allow a recovery residence to discharge a resident for some very good reasons (e.g. it’s necessary for the resident’s welfare). In these ways and others, the law is thoughtful.
REITs are part of an extremely complex and diverse industry, but they can also be very profitable. Not only are there different categories of REITs, many different property types and classifications can comprise them.
Let’s start with the three types of REITs: mortgage, equity and hybrid.
There are three ways a real estate investment trust can be structured.
The first type, is a Mortgage REIT. Mortgage REITs work by creating a trust which will provide a loan and lend money to landlords and their operational teams to purchase a property. The way revenue is generated is through the interest paid on the mortgage loans. Interest can be earned either directly from mortgages or from mortgage-backed securities. Mortgage real estate investment trusts are not direct investments in specific property. Since the primary way the mortgage REIT survives is through the interest earned, many factors can make a mortgage REIT strong or weak. These factors include mortgage rates, prepayments of a loan before the due date, and credit events like foreclosure or bankruptcy.
The second type of real estate investment trust is an equity REIT. An equity REIT owns and operates income-producing real estate assets like offices, shopping centers, medical facilities, and resorts, among many other assets. This is the category where healthcare REITs fall. The real estate investment trust leases space in the facilities to tenants for rent. Most of the equity REITs operates in their core areas. For healthcare operations, this includes medical office building (MOB) development, outpatient facilities, senior housing facilities, nursing homes, and assisted living facilities. Essentially healthcare REITs are landlords to the medical world.. Many Healthcare REITS have substantial stakes in seniors housing. Some of them own the buildings outright and have tenants pay the leases, as well as the taxes and upkeep (so called triple-net-lease arrangements, or NNN). Some healthcare REITs own the property but has an operating company run the day-to-day operations.
Finally the third type of REIT is a Hybrid REIT, which is a combination of equity and mortgage REITS. This REIT generates income from rent and capital gains like an equity REIT but receives interest like a mortgage REIT.
Ransomware attacks are impacting the healthcare community’s HIPAA security at a staggering rate. If a practice has data stolen from their network and they did not report the breach to The Office of Civil Rights (OCR), they could be subject to massive fines for the lack of reporting. Specific steps must be followed to determine if ePHI (electronic protected health information) was compromised. This often involves hiring a forensics company and working with a Cybersecurity company to harden the practice’s infrastructure. When you are the victim of an attack once, you will mostly likely be a victim again because of vulnerabilities in your network that enabled the attack vector (or payload) to infiltrate your system. You cannot simply restore your data and hope for the best.
Employers are approaching us in increasing numbers regarding their obligations toward employees battling substance abuse. Two federal laws primarily govern the space, the Americans with Disabilities Act and the Family and Medical Leave Act. Note that state laws may be more restrictive, so we encourage our clients to reach out to local attorneys to determine if additional legal protections are available to employees in their state.
The Americans with Disabilities Act (ADA) covers businesses with 15 or more employees to protects workers from discrimination based on a qualifying disability or a perceived disability, which is defined to include alcoholism and illegal drug use. However, to be eligible, the ADA protects only workers who either (i) have successfully been rehabilitated and are no longer using illegal drugs or misusing alcohol; or (ii) are currently participating in a rehabilitation program and are no longer using illegal drugs or misusing alcohol. Importantly, the ADA does not protect any employee who is presently battling alcoholism and illegal drug use and is not participating in a treatment program. An employee in the throes of substance abuse who is not actively seeking treatment is not protected by the ADA.
As you may have heard, the State Hemp Plan, SB 1020, has passed the Florida House and Senate and is waiting for Governor DeSantis’ action (approval or veto) or inaction (no veto). The Governor’s approval or failure to veto SB 1020 means SB 1020 will become law. So what does this mean for Florida?
SB 1020 is meant to bring Florida’s laws regarding the cultivation and processing of hemp in line with the Federal Farm Bill of 2018 which removed hemp from the DEA’s list of controlled substances and legalized the industrial use of hemp. Currently, hemp is listed as a controlled substance under Florida law. SB 1020 will change that and allow cultivation of hemp and distribution and retail sale of hemp extract.
There has been much talk about the future of health care real estate investment trusts (REIT) and the evolution of the real estate market, as well as the way patient care is being provided in today’s world. With greater demand for outpatient and ambulatory surgical centers, the healthcare REIT market is forecasted to be a bullish market. Additional reasons for positive forecasts include an aging population with greater demand, a track record of high performance, and cost of equity capital. Investing in income-generating real estate can be a great way to increase net worth. For many, investing in real estate, particularly commercial real estate, seems to be out of reach financially. However, with the right partnerships and guidance, it is possible. REITs (pronounced “reets”) allow mall investors today to pool their resources with other small investors in order to invest in large-scale commercial real estate as a group.
In a decision expected to cause waves through the rapidly-expanding regenerative medicine industry, a U.S. District Court Judge ruled on June 3rd that the U.S. Food and Drug Administration (FDA) is entitled to an injunction in a lawsuit filed against U.S. Stem Cell Clinic, LLC (US Stem Cell) based in Sunrise, Florida. In her decision, U.S. District Court Judge Ursula Ungaro agreed that the FDA has the authority to regulate the popular stem cell procedure known as stromal vascular fraction (SVF) – administering processed stem cells derived from adipose tissue (i.e. fat tissue) – and that US Stem Cell is not exempt from regulation.
To recap, in May 2018, the U.S. Department of Justice (DOJ) filed complaints against US Stem Cell and a California stem cell clinic seeking permanent injunctions to prevent the marketing and administration of the SVF procedures without FDA approval. Prior to the filing of these actions, both companies received warning letters from the FDA. The letters also addressed the results of inspections and the need to resolve significant deviations from manufacturing practice requirements.
Health law is the federal, state, and local law, rules, regulations and other jurisprudence among providers, payers and vendors to the healthcare industry and its patient and delivery of health care services; all with an emphasis on operations, regulatory and transactional legal issues.