It’s hard to predict exactly what President-elect Donald Trump wants in a new health care law, but a repeal of the Affordable Care Act (ACA) is rapidly on track in Congress, according to a report published on the website of Androvett Legal Media & Marketing. Dallas health care lawyer Jeff Drummond of Jackson Walker LLP, who represents doctors, hospitals and other health care facilities, has some predictions about what to expect:

“Repeal is almost entirely certain, and will be near immediate with the new Congress. It will be done using the same reconciliation technique that allowed ACA to pass in the first place, thus avoiding the filibuster and the need for 60 votes in the Senate.

“The changes likely will be phased in over time, with very few, if any, immediately repealed. That will allow the new Congress time to fashion replacement parts. And those replacement parts will mostly resemble the old law.

“For example, the new law will allow insured parents to keep their children on their policies until age 26. It also will likely preserve the ban on lifetime limits.

“The new law will drop the individual mandate to buy health insurance. But coverage for pre-existing conditions will be more like the portability requirement under the Health Insurance Portability and Accountability Act (HIPAA). That law requires insurers to accept people with existing health problems only when they previously had coverage, such as from their current or former employer. So people with pre-existing health conditions now covered under individual policies through the ACA would be eligible for coverage under the new law, but individuals who did not previously have coverage would be subject to potential exclusion for pre-existing conditions.”

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Johnson & Johnson won a ruling cutting almost in half a $1.04 billion jury award to patients who accused the company of hiding defects in its Pinnacle artificial hips that had to be surgically removed, reports Insurance Journal.

The jury’s finding that officials of J&J and its DePuy unit failed to properly warn doctors and patients about the artificial hips’ flaws is intact. But U.S. District Judge Ed Kinkeade in Dallas found the panel’s punitive-damage awards to six patients were excessive and should be reduced, according to court filings.

“J&J still faces almost 9,000 lawsuits accusing the company of illegally marketing the flawed metal-on-metal hips. J&J stopped selling the devices in 2013 after the U.S. Food and Drug Administration toughened artificial-hip regulations,” according to reporter Jef Feeley.

Read the Insurance Journal article.

Leading Republicans in Congress have vowed that even if they repeal most of the Affordable Care Act early in 2017, a replacement won’t hurt those now receiving benefits, reports NPR.

Reporter Julie Rovner  writes that Republicans will seek to ensure that “no one is worse off,” quoting House Speaker Paul Ryan. “The purpose here is to bring relief to people who are suffering from Obamacare so that they can get something better.”

“But that may be difficult for one big reason: Republicans have also pledged to repeal the taxes that Democrats used to pay for their health law. Without that money, Republicans will have far less to spend on whatever they opt for as a replacement.” writes Rovner.

Read the NPR article.

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The president and chief operating officer of Texas-based Adeptus Health is the latest executive out the door at the nation’s largest operator of freestanding emergency facilities, reports The Dallas Morning News.

Graham Cherrington is the second executive to leave the embattled company suddenly in recent months, following a disappointing $11.7 million loss in third quarter. He follows longtime chief executive officer Thomas Hall, whose retirement was accelerated to November, writes reporter Sabriya Rice.

“The company went public with its freestanding emergency room model in June 2014, and now operates more than 90 facilities across the United States.  In 2015 it generated $365 million in revenue,” she writes. “Shares plummeted in November following the disappointing loss and an unexpected request to secure $27.5 million in emergency financing from investors.”

Read the Dallas News article.

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A federal jury in Dallas ordered Johnson & Johnson and one of its subsidiaries to pay more than $1 billion in damages Thursday for “despicable and vile conduct” in selling Pinnacle metal-on-metal hip implants that they knew were seriously defective, reports The Dallas Morning News.

The New Jersey pharmaceutical and medical device maker and its DePuy Orthopaedics subsidiary must pay damages to six California plaintiffs who say they suffered serious chronic and painful medical problems caused by the device.

“The trial was the third in a series of bellwether cases being held by U.S. District Judge Ed Kinkeade,” reports Mark Curriden of Texas Lawbook for The Morning News. “More than 8,900 cases against Johnson & Johnson and DePuy have been filed across the U.S. The lawsuits have been consolidated in what is known as multi-district litigation.”

Read The Morning News article.

U.S. prosecutors are bearing down on generic pharmaceutical companies in a sweeping criminal investigation into suspected price collusion, a fresh challenge for an industry that’s already reeling from public outrage over the spiraling costs of some medicines, reports Bloomberg.

David McLaughlin and Caroline Chen write that the antitrust investigation by the Justice Department spans more than a dozen companies and about two dozen drugs. A grand jury is examining whether some executives agreed with one another to raise prices, and the first charges could emerge by the end of the year, sources told the reporters.

“Among the drugmakers to have received subpoenas are industry giants Mylan NV and Teva Pharmaceutical Industries Ltd. Other companies include Actavis, which Teva bought from Allergan Plc in August, Lannett Co., Impax Laboratories Inc., Covis Pharma Holdings Sarl, Sun Pharmaceutical Industries Ltd., Mayne Pharma Group Ltd., Endo International Plc’s subsidiary Par Pharmaceutical Holdings and Taro Pharmaceutical Industries Ltd.,” according to the report.

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The Society of Corporate Compliance and Ethics and the Health Care Compliance Association recently conducted a survey to gauge the effectiveness of compliance programs at preventing incidents from occurring.

The SCCE has made the survey results available for free downloading.

For any compliance program, a critical measure of success is its ability to prevent incidents from occurring. Determining how many events are avoided is difficult, though, the SCCE says on its website. Employees rarely come forward to report, “I was about to commit a felony and then remembered that compliance training I received.”

Yet, near misses do occur and can provide proof of a compliance program’s effectiveness. To gain a better understanding of the effectiveness of compliance programs at preventing problems, in the third quarter of 2016 the Society of Corporate Compliance and Ethics and the Health Care Compliance Association jointly fielded the survey of compliance and ethics professionals.

Download the survey results.

Elizabeth Holmes

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Partner Fund Management, a San Francisco-based hedge fund that reportedly wrote out a $96 million check to Theranos in 2014, is now suing the blood-testing startup and its founder, Elizabeth Holmes, reports TechCrunch.

In its filing, the plaintiff says Theranos duped it into investing “through a series of lies, material misstatements, and omissions,” and accusing the firm of engaging in “securities fraud and other violations by fraudulently inducing” it to invest and to maintain its investment in the company reports Connie Loizos.

Reports says that the plaintiff claims says Holmes and another former Theranos executive blatantly lied to the hedge fund by claiming it had developed “proprietary technologies that worked” and that it was nearing regulatory approvals.

Read the article.

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Mylan NV has announced it will pay $465 million to settle questions of whether it underpaid U.S. government healthcare programs by misclassifying its EpiPen emergency allergy treatment, Reuters is reporting. The announcement comes as the company is under intense scrutiny after a series of drastic price increases.

“Mylan has been lambasted by consumers and lawmakers for raising prices on the lifesaving EpiPen sixfold to over $600 for a package of two in less than a decade, making the devices unaffordable for a growing number of families,” writes Deena Beasley.

At issue is whether Mylan made more money on EpiPen than warranted from state Medicaid programs by having it classified as a generic product. That classification yielded much smaller rebates to the government health plans. Beasley explains that the Medicaid rebate for a generic prescription drug is 13 percent, compared with a minimum 23.1 percent for a branded drug.

Read the article.

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A law firm in Montgomery, Ala., says it received nearly 26,000 phone calls from people inquiring about a possible link between talcum powder and ovarian cancer after its clients won a total of $127 million in two verdicts earlier this year, reports AL.com.

Beasley, Allen, Crow, Methvin, Portis & Miles, P.C. reported 12,221 open cases from the 25,916 calls it had received as of Thursday. In a statement, the firm said it now has 867 cases filed nationwide against Johnson & Johnson regarding talcum powder products, which plaintiffs have claimed are linked to cases of ovarian cancer.

“In February a City of St. Louis Circuit Court jury awarded the family of Jacqueline Fox $72 million, finding Johnson & Johnson liable for her ovarian cancer that led to her death,” reports Kent Faulk of AL.com. “In May another jury in St. Louis found Johnson & Johnson liable for ovarian cancer linked to genital use of its talcum powder products and awarded a South Dakota woman, Gloria Ristesund, $55 million.”

“Though it’s been discussed as a hypothesis and carefully studied for decades, there is no proven linkage between talc and ovarian cancer,” Gene Williams, outside counsel for Johnson & Johnson, told Legal NewsLine.

Read the article.

Elizabeth Holmes

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Fox Business is reporting that Theranos Inc. has withdrawn its request for emergency clearance of a Zika-virus blood test after federal regulators found that the company didn’t include proper patient safeguards in a study of the new test.

“The move is another setback for the Palo Alto, Calif., company as it tries to recover from crippling regulatory sanctions that followed revelations by The Wall Street Journal of shortcomings in Theranos’s technology and operations,” Fox Business reports. “Theranos has said it is appealing.”

Elizabeth Holmes, founder of the troubled company, recently announced development of a new blood-testing device that she said was designed for use outside a clinical laboratory and could run accurate tests from a few drops of blood.

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Health officials reported the first spread of the Zika virus from state to state when a Texas man got the disease after visiting a section of Miami where mosquitoes have been spreading Zika.

The Zika virus can cause brain damage and other birth defects in infants if the mother is infected during pregnancy. While its dangers first appeared in Brazil, its spread to the U.S. has magnified questions about risk, including to workers whose employers want them to travel.

For example, what steps are employers legally required to take if they need an employee to travel to a hot zone? What is the liability if an employee contracts the disease, which also can be sexually transmitted and spread when a mosquito bites an infected person and carries it to someone else?

Androvett Legal Media & Marketing has posted an article on its website quoting Justin Markel, a labor and employment lawyer in the Houston office of Roberts Markel Weinberg Butler Hailey PC:

“Under the Occupational Safety and Health Act, employees may refuse to work in certain circumstances when working conditions are dangerous. Among other things, the employee must genuinely believe that an imminent danger exists, and there must be a real danger of death or serious injury. Because of the way Zika is transmitted and the availability of preventive measures, it is unlikely that an employee could refuse to travel on this ground – unless the employee is pregnant.

“However, employers should be cautious when an employee refuses such a work assignment. An employee could argue that she is protected by OSHA and is shielded from adverse employment actions.”

Markel says that employer liability depends in part on participation in the worker’s compensation system. In Texas, employers have the option of whether to participate, he notes. “If the employee is covered by workers’ comp insurance, and if it could be proven that the employee contracted Zika while working, then the employee may have a workers’ comp claim. That would also mean that workers’ comp benefits are the employee’s exclusive remedy.

“If the employer does not subscribe to workers’ comp, then the employer may be liable for failing to provide a safe work environment if the employer does not take reasonable precautions to protect against Zika exposure,” he says.

Markel says employers with workers in affected areas should focus on educating their workforce about precautionary measures. OSHA has published helpful guidance here. Employers should try to limit standing water near worksites, and employees working outside should use mosquito repellant and wear long sleeves and pants.

CNN is reporting that Kentucky’s attorney general is suing health-care giant Johnson & Johnson for millions of dollars, saying the company “concealed and misrepresented” the risk of its transvaginal mesh products to doctors and patients.

In the lawsuit, AG Andy Beshear alleged Johnson & Johnson’s medical device company, Ethicon, didn’t provide enough information about possible adverse effects to more than 15,000 women in Kentucky who had the transvaginal mesh implanted.

The company called the suit justified.

“The lawsuit says women have reported chronic pelvic pain, pain associated with intercourse and/or the loss sexual function, and other health problems,” according to the report by Steve Almasy.

Read the article.

Gilead Sciences Inc. is entitled to receive the attorney fees it incurred related to hepatitis C patent litigation with drugmaker Merck & Co Inc., a U.S. district judge has ruled, reports Reuters.

“In June, Gilead was freed from paying up $200 million in damages for infringing two Merck patents related to Gilead’s blockbuster drugs Sovaldi and Harvoni, after a U.S. judge found a pattern of misconduct by Merck including lying under oath and other unethical practices,” writes Anya George Tharakan.

The court found that Giliead could receive relief from the cost of its legal fees in defending against the Merck challenge.

Read the story.

The operator of 12 hospitals and more than 200 other treatment centers in Chicago and central Illinois has agreed to the largest settlement to date with the Office for Civil Rights for multiple potential violations of the Health Insurance Portability and Accountability Act, reports Kelly A. Leahy of Shumaker, Loop & Kendrick.

The agreement will cost Advocate Health Care Network $5.5 million and force Advocate to adopt a multi-year corrective action plan that stemmed from three incidents reported to OCR in 2013.  The breaches involved Advocate’s medical group subsidiary, Advocate Medical Group, which employs more than 1,000 physicians. The incidents that cost Advocate involved data breaches involving unencrypted devices and unauthorized access to a network.

In the article, Leahy offers some suggestions for what covered entities and business associates can do to prevent costly fines and burdensome settlements.

Read the article.

Although Theranos’s history — which includes several administrative penalties for the troubled blood-testing company — has received an outsize amount of media attention, its experience with regulatory agencies highlights several important issues for start-up and emerging health care entities, writes Robert E. Wanerman in Epstein Becker & Green‘s Health Law Advisor blog.

He discusses four major questions raised in this type of case, with these headings: What Do Regulators Want?, What Do Health Care Providers and Payors Want?, Who Is Investing in the Venture?, and Who’s on Board?

On the first point, he wrote that “even in an environment that encourages innovation, health care organizations must understand the scope of regulatory oversight at the federal and state levels, and the range of remedies available to regulators for noncompliance. Every organization should also have a protocol in place for responding to regulatory inquiries or inspections.”

Read the article.

Two former executives of Acclarent Inc, a medical device company bought by Johnson & Johnson in 2010, were convicted on Wednesday by a U.S. jury on charges of promoting a product for an unapproved use, Reuters is reporting.

Prosecutors said former Acclarent Chief Executive William Facteau and former Vice President of Sales Patrick Fabian were found guilty in federal court in Boston of 10 misdemeanor counts of violating the U.S. Food, Drug and Cosmetic Act. The counts each carry a maximum prison sentence of one year.

But the jury acquitted the two defendants of felony charges of wire fraud and conspiracy, finding they did not act with intent to defraud or mislead.

“In an indictment unsealed last April, federal prosecutors said that beginning in 2006 or earlier, Facteau, 47, and Fabian, 49, promoted Acclarent’s Relieva Stratus Microflow Spacer device to deliver steroid medications to patients’ sinuses, though it was only approved by the U.S. Food and Drug Administration for keeping sinuses open,” reports Brendan Pierson for Reuters.

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The U.S. Department of Justice has filed lawsuits to block the proposed mergers of four of the nation’s five biggest health insurers, reports The New York Times.

The proposed mergers involve Aetna and Humana, and Anthem and Cigna.

U.S. Attorney General Loretta E. Lynch said the proposed mergers “would leave much of the multitrillion-dollar health insurance industry in the hands of three mammoth insurance companies.”

“If these mergers were to take place, the competition among insurers that has pushed them to provide lower premiums, higher-quality care and better benefits would be eliminated,” she said.

“The companies responded by vowing, in varying degrees, to fight the government’s challenge,” report Leslie Picker and Reed Abelson. “Aetna, which had hoped to gain an advantage by being the first to reach a deal, aggressively defended its proposed merger, which it contended was different from the larger Anthem-Cigna deal that followed.”

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Theranos Inc.’s Chief Executive Officer Elizabeth Holmes was banned for two years from owning or operating laboratories by U.S. regulators, a major blow against the controversial blood-testing startup that’s come under scrutiny for risking patient harm with unreliable tests, reports Doni Bloomfield for Bloomberg Technology.

“The once high-flying Silicon Valley company was also penalized for an undisclosed amount and lost its eligibility to get payments from federal health insurance programs for lab services, according to a statement late Thursday from Theranos, citing a notice it received from the Centers for Medicare and Medicaid Services,” the report says. “The closely-held firm is shutting down its Newark, California, lab and plans to rebuild it, Holmes said.”

The company founded by Holmes at one time had a $9 billion private valuation, based on technology that it said would allow for cheap, less-painful blood tests processed with breakthrough analyzers. Regulators soon stepped in, citing violations that put patients’ health and safety at risk.

Read the article.

A federal judge found a pattern of misconduct by Merck & Co., including lying under oath and other unethical practices, freeing Gilead Sciences Inc from paying any damages for infringing Merck’s patents with its lucrative treatments for hepatitis C, Sovaldi and Harvoni, according to a Reuters report.

The ruling follows a March 24 jury verdict that ordered Gilead to pay $200 million in damages, based on findings that Merck’s patents were valid.

In this week’s ruling, U.S. District Judge Beth Labson Freeman said Merck deceptively used confidential information from Pharmasset, Inc, a company Gilead bought in 2011.

“Freeman also said Merck cannot enforce the patents because Merck’s own lawyer gave inconsistent and untruthful testimony during the trial. ‘Merck’s acts are even more egregious because the main perpetrator of its misconduct was its attorney,’ she said,” reports Andrew Chung.

Read the article.