Health Law Update - January 26, 2017

Alerts / January 26, 2017

Welcome to this week's edition of the Health Law Update. In this Issue

  • Capitol Hill Healthcare Update
  • Welcome to the Future: HHS Releases Final Rule to Modernize Protections for Clinical Trial Participants
  • More Time to Streamline: NIH Extends Deadline for Implementation of Single IRBs for Funded Studies
  • Hold the Phone! The Joint Commission Reinstates Ban on Texting Orders
  • Rosebush, Holmes, Rochford Article on Drug Pricing Published in AHLA’s ‘Top 10’ Issues Magazine
  • Events Calendar
Capitol Hill Healthcare Update

By Michael A. Ferguson, Christian B. Jones, Adam J. Higgins and Tyler M. Thompson

Trump order seeks to undermine ACA

President Donald Trump didn’t mention the Affordable Care Act (ACA) in his inaugural address but later that night he signed a sweeping executive order that directs federal agencies to effectively undermine the health law. The executive order doesn’t repeal the ACA, and it’s mostly symbolic – but it is a powerful symbol of a government now committed to undoing the law that the Obama administration spent six years defending in Congress and the courts.

Still, some say the ACA’s broad reliance on regulations and executive orders during implementation means those same tools can now be used to undo the law. Trump’s executive order called on government departments and agencies to “ease the burdens” on individuals, states and providers “to the maximum extent permitted by law.” The executive order could be cited by states seeking expansive waivers and new flexibilities from the U.S. Department of Health and Human Services (HHS) to introduce Medicaid reforms, like tying work requirements to Medicaid coverage.

Republicans plot ACA next steps

Congressional Republicans are holding an annual policy retreat in Philadelphia this week, and one of the chief topics will be the GOP’s plan to repeal and replace the ACA. House and Senate leaders aim to thoroughly discuss with rank-and-file lawmakers the policy and political consequences as well as the timing of actions to change the health law. The Philadelphia retreat will be key because Republicans haven’t been able to agree on what comes after the ACA repeal, so GOP leaders hope to emerge from the retreat with policy and political consensus.

House Republicans had been intent on repealing the ACA next month – though with an effective date of no earlier than the end of 2018 – and using the intervening months to develop a policy alternative that could unite the party and even attract some Democrats. That plan was sabotaged when several Senate Republicans came out in favor of identifying the replacement plan before voting to repeal the ACA – a position Trump quickly endorsed. The emerging GOP plan would repeal key portions of the ACA using budget reconciliation legislation that Senate Democrats can’t block with a filibuster. Rather than wait until later to vote on a replacement, Republicans would try to include replacement elements in the reconciliation legislation and follow up with other health bills later.

Trump and Vice President Mike Pence are scheduled to address Republicans during the retreat. In previous years during portions of the Republican retreats that are closed to the media, lawmakers engaged the president in question-and-answer sessions on a variety of topics. It’s not clear whether Trump will similarly participate in Q&A or whether the President will reveal more of his plans for ACA replacement.

House Republicans hold ACA hearings

Two House committees are keeping the pressure on the ACA this week as Republicans continue to lay groundwork for repealing the law. On Tuesday, the Budget Committee examined the “harmful effects and broken promises” of the ACA while the Ways and Means Oversight Subcommittee looked at the effectiveness of the individual mandate.

Dems pummel Price; HHS pick skirts on drug prices

Senate Democrats last week unleashed a double-barreled attack on Rep. Tom Price (R-Ga.) over his support for repealing the ACA and his ethics. During the Senate HELP Committee hearing, Democrats accused the nominee for HHS secretary of supporting cuts to Medicare and Medicaid of more than $1 trillion. Price also came under fire for trading in healthcare stock while also actively working on legislation affecting the sector. The majority but not all of Price’s stock transactions were broker-directed.

Price was asked by Sen. Bernie Sanders (I-Vt.) to support his legislation permitting Medicare to negotiate directly with pharmaceutical manufacturers on drug prices. Trump has also endorsed direct government negotiations on prices. Price has long opposed government negotiation, previously saying it amounted to government price controls. During the hearing, Price walked a tightrope of not disavowing his previous position while also not disagreeing with Trump’s. Ultimately, he pledged to work with Sanders to find solutions to rising drug prices.

Price’s nomination is not currently thought to be in jeopardy, although he faced similar Democratic criticism during a tense four-hour confirmation hearing of the Senate Finance Committee Tuesday. Republicans have praised the Georgia physician, with Sen. Orrin Hatch (R-Utah) saying Price was one of the “really premier people in the whole Congress” who understands health policy.

Price’s nomination likely won’t receive a full Senate vote until next month.

GOP senators introduce health bills

Seeking to exploit division within his own party on what should follow the ACA repeal, Sen. Rand Paul (R-Ky.) introduced his legislative proposal Tuesday to help people pay for insurance with tax credits and health savings accounts. Paul, an ophthalmologist, said his bill would allow individuals and small businesses to exert more leverage over prices by forming associations when buying insurance. Paul’s bill also would allow for the purchase of health insurance from an HSA account.

Separately, Sens. Bill Cassidy (R-La.) and Susan Collins (R-Maine) introduced their legislative proposal Monday to permit states to keep the ACA provisions, including their expanded Medicaid, or transition to a new system of health savings accounts and automatic health plan enrollment. Both Cassidy and Collins hope their bill will attract support from Democrats.

Providers call for value-based payment models

The nation’s “leading clinicians, employers, hospitals, biopharmaceutical companies, pharmacists, patients, consumer groups and insurance providers” called on policymakers Wednesday to continue the focus “on driving value-based, patient-centered payment models that incent healthcare innovation.” Underscoring the group’s commitment to working with the Trump administration and Congress “to build the next generation of healthcare policy,” Wednesday’s letter cautioned that “Now is not the time for policymakers to signal a shift away from value-based care, either through action or inaction.” The letter also enumerates principles “for a modernized, sustainable healthcare system” including payment models that align payers, healthcare providers, providers of long-term care services and clinicians and expanded waivers from fee-for-service legal and regulatory requirements “that impede collaboration and shared accountability.”

Welcome to the Future: HHS Releases Final Rule to Modernize Protections for Clinical Trial Participants

By Kyle R. Gregory and Payal Cramer

The Federal Policy for the Protection of Human Subjects, or the “Common Rule,” governs the ethical conduct of research involving human subjects and is funded through various federal agencies. On January 19, the U.S. Department of Health and Human Services in collaboration with 15 other federal agencies (the Agencies) issued a Final Rule to update the Common Rule. This update represents the most substantive update to the Common Rule since 1991 and follows the 2015 Notice of Proposed Rulemaking (NPRM). A detailed overview of stakeholder comments and concerns in response to the NPRM is available here and here. The majority of the Final Rule goes into effect January 19, 2018.

The changes to the Common Rule reflect the evolving nature of research and research settings over the past few decades. The Agencies noted that the evolution in technology has changed the scale, nature and integration of information collected, allowing researchers to collect and analyze data in ways that were unimaginable when the Common Rule was first adopted. The most significant changes to the Common Rule are addressed below.

New informed consent requirements

The Final Rule establishes new requirements regarding the information that must be given to prospective research subjects as part of the informed consent process. Consent forms must include a concise explanation – at the beginning of the document – of the key information that would be most important to individuals contemplating participation in the named study. Key information includes the purpose of the research, the risks and benefits, and appropriate alternative treatments that might be beneficial to the prospective subject. If appropriate, the summary may indicate that these pieces are explained in greater detail later in the consent form. Although the Agencies declined to provide explicit requirements or a sample template, their expectation is that this initial presentation of the key pieces of information will be relatively short.

In addition, the Final Rule alters existing consent requirements by allowing institutional review boards (IRBs) to approve a research proposal for which investigators obtain information or biospecimens without individuals’ informed consent for the purpose of screening, recruiting or determining the eligibility of prospective human subjects of research, provided certain conditions are met. Finally, the Final Rule contains a new requirement that entities must post to a federal website a copy of an IRB-approved version of the consent form that was used for enrollment purposes, for each clinical trial conducted or supported by a federal department or agency.

Use of broad consent

The Final Rule permits the use of a broad consent from a subject for the storage, maintenance and secondary research use of identifiable private information and identifiable biospecimens. Thus, investigators may seek prospective consent to unspecified future research.

Under the Final Rule, broad consent provides investigators with an alternative to seeking IRB waiver of the informed consent requirement or obtaining subject consent for certain types of study. The federal government is not obligated to develop a template for broad consent forms.

New categories of exempt research

The Final Rule establishes new categories of research exempt from IRB review based on their risk profile. Significant exemptions include:

  • Certain secondary research involving identifiable private information if the research is already subject to the HIPAA rules
  • Certain research involving benign interventions
  • Certain research involving educational tests, survey or interview procedures, or observation of public behavior where identifiable private information was recorded, so long as data protection standards are met
  • Secondary research use of identifiable private information originally collected for non-research purposes
  • Activities relating to storing and maintaining biospecimens and identifiable private information for secondary research use, if subjects provided broad consent
  • Secondary research studies that would use the biospecimens and identifiable private information stored or maintained under the above exemption

These new exempt categories are designed to allow IRBs to spend more time reviewing riskier studies. To further that goal, the Final Rule also removes the requirement to conduct a continual review of ongoing research for studies that undergo expedited review and for studies that have completed study interventions and are merely analyzing study data or involve only observational follow-up in conjunction with standard clinical care.

Single IRB requirement

The Final Rule creates a requirement for U.S.-based institutions engaged in cooperative research to use a single IRB for that portion of the research that takes place within the United States, with certain exceptions. It should be noted that nothing in the Final Rule prevents an institution from conducting its own additional (i.e., local) IRB review of a project; however, the commentary surrounding the Final Rule does make clear that the local IRB would have no regulatory authority and its review would have no regulatory standing in such instance. The single IRB requirement becomes effective January 20, 2020.

What the Final Rule did not do

Of perhaps greatest importance is what the Final Rule did not do. In the NPRM, one of the major proposed revisions was a requirement that research involving non-identified biospecimens be subject to the Common Rule, and that consent would need to be obtained to conduct such research. The Final Rule however, did not implement this requirement, citing concerns received from the scientific community about the complexity and lack of justification for such changes. In addition, the Final Rule did not expand the Common Rule to cover clinical trials that are not federally funded.

Furthermore, to the extent that some of the proposals in the NPRM relied on tools or standards that had not yet been proposed, the Final Rule either does not adopt those proposals or includes revisions to eliminate such reliance. Unfortunately, many of these items were tools that entities could use to ensure compliance with the Final Rule, such as a template to be used for broad consent forms, and a decision tool to be used for making exemption determinations.


While the publication of the Final Rule was much anticipated, the future of the Final Rule remains somewhat uncertain due to the possibility that the new Congress may overturn this and other new regulations passed by the prior administration in recent months.

More Time to Streamline: NIH Extends Deadline for Implementation of Single IRBs for Funded Studies

By Ernessa B. McKie

The research community has a full plate as it sifts through the final rule on the Common Rule issued last week. Many are now fully appreciating the December gift from the National Institutes of Health that granted an extension for developing policies to streamline multi-site studies under a single Institutional Review Board (IRB).

On December 16, 2016, the NIH officially notified the public that it will delay implementation of its policy to require domestic NIH-funded multi-site studies to use one IRB of record for ethical reviews of all other sites in the study. Originally, the policy was set to apply to all applications submitted on or after May 25, 2017. Based on numerous concerns voiced by the research community, NIH delayed the implementation date four months. The policy is now effective for all applications received on or after September 25, 2017. Ongoing, non-competing awards are not expected to follow the policy until the grantee submits a competing renewal application after the policy is in effect. For contracts, the policy applies to all solicitations issued on or after the effective date.

NIH’s policy is akin to policies issued by the National Cancer Institute and other NIH programs. Citing its effort to streamline administrative processes and create more reporting efficiency, NIH believes that a single IRB will ensure that the same study administered at multiple sites will be conducted in a more uniform manner, including less variation with informed consent and other key IRB documents. Researchers will be required to coordinate and determine the best site to submit to NIH for the record. NIH has issued a robust set of frequently asked questions regarding the policy and its implementation. The changes to the implementation deadline did not result in any changes to the policy.

Hold the Phone! The Joint Commission Reinstates Ban on Texting Orders

By Elizabeth O’Connell and Vimala Devassy

The Joint Commission (TJC) and the Centers for Medicare & Medicaid Services (CMS) took a firm stance against physicians texting patient orders in a recent joint statement, clarifying that it is not acceptable for physicians or licensed independent practitioners to text orders for patient care, treatment or services to hospitals or other healthcare providers. Instead, computerized provider order entry (CPOE) should be the preferred method for submitting orders, and in the event that a CPOE or written order cannot be submitted, a verbal order is acceptable.

The new guidance rescinds TJC’s May 2016 guidance, which permitted utilization of secure text messaging platforms, but was suspended a month later to permit TJC to collaborate with CMS. The results of this TJC/CMS collaboration were manifested in the December 2016 publication, in which TJC prohibits the use of secured text orders and promotes the use of CPOE instead.

TJC also said that all healthcare organizations should have policies prohibiting the use of unsecured text messaging for communicating protected health information. TJC and CMS strongly urged providers to utilize CPOE to ensure accuracy and allow direct order entry into the electronic health record. While permitting verbal orders, the guidance cautions that they should be used infrequently and only in instances when using CPOE is impossible or impracticable.

Rosebush, Holmes, Rochford Article on Drug Pricing Published in AHLA’s ‘Top 10’ Issues Magazine
Events Calendar

January 31, 2017

Cleveland Of Counsel Thomas S. Campanella will present “Reimbursement’s Impact on Device Business Development” at the Medical Device Business Development: Mergers, Acquisitions & Corporate Strategy Conference in Atlanta, Ga.

February 2, 2017

Atlanta Partner Kristen McDermott Woodrum is presenting “The Stark Realities of MACRA” at the AHLA Physicians and Hospital Law Institute in Orlando, Fla.

February 15, 2017

Houston Partner Lynn Sessions will be speaking at the “Healthcare Cyber 101 Event” for the Greater Houston Society for Healthcare Risk Management in Houston, Texas.

February 16, 2017

Houston Partner Susan Feigin Harris will present “The Affordable Care Act Post-Election” at the Alliant 6th Annual Healthcare Education Forum in Houston, Texas.

February 23, 2017

Washington, D.C., Partner Lee Rosebush will be hosting a CLE webinar in conjunction with Lawline on recent developments in pharmacy and pharmaceutical law. The live webcast will cover a wide range of issues, including pharmacist-in-charge liability, compounding law, off-label use, false claims, product liability issues and medical marijuana. For more information and to register, please consult the Lawline website.

February 23-24, 2017

Houston Partner Lynn Sessions will present “Preparing for Your Coming Privacy Breach” at the American Health Lawyers Association’s Long Term Care and the Law Program in San Diego, CalifMarch 10, 2017

Atlanta Partner Kristen McDermott Woodrum is presenting “Making Sense of MACRA in the AMC Setting: Adapting to the New Quality Payment Program” at the AHLA Legal Issues Affecting Academic Medical Centers and Other Teaching Institutions Conference in Baltimore, Md.

March 11, 2017

Houston Partner Lynn Sessions will present “Domino Effect of Flawed Breach Response” at the 2017 SXSW Conference in Austin, Texas.

April 6, 2017

Houston Partner Donna S. Clark will present a Stark Law Update at the UT CLE 2017 Health Law Conference, in Austin, Texas.

Houston Partner B. Scott McBride will present “Recent Trends in the False Claims Act and Government Enforcement” at the UT CLE 2017 Health Law Conference, in Austin, Texas.

April 7, 2017

Houston Partner Susan Feigin Harris will moderate the panel “The Realities and Future of Payment and Delivery Reform” at the UT CLE 2017 Health Law Conference, in Austin, Texas.

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