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DHHS Waives Certain Regulatory Requirements for Hospitals and Practitioners in Light of COVID-19

Health & Life Sciences Alert Sarah E. Coyne, Jon R. Kammerzelt

As a result of the consequences of the COVID-19 pandemic, hospitals, physicians, and other providers have some relief from federal regulations, retroactive to March 1, 2020, as a result of a waiver issued March 15, 2020, by the Secretary of the Department of Health and Human Services (DHHS). The waiver—issued under Section 1135(b) of the Social Security Act—is intended to relieve regulatory obligations to the extent necessary as determined in each case by the Centers for Medicare and Medicaid Services (CMS).

The waiver is necessarily vague and leaves significant discretion to CMS. The waiver explicitly applies to hospitals as well as practitioners (not limited to just physicians) and suppliers of services or items paid for by Medicare or Medicaid. The waiver contains the following parameters:

  • Certain Conditions of Participation for hospitals and critical access hospitals (CAHs)are waived—to the extent necessary to accommodate the pandemic
  • State licensure is not a reason for denying Medicare/ Medicaid reimbursement in emergencies (although providers should consider each state's position with regard to licensing laws and non-governmental reimbursement)
  • The Emergency Medical Treatment and Labor Act (EMTALA) requirements relating to redirecting, relocating, transferring, and medically screening patients affected by the COVID-19 pandemic, if they cannot be accommodated, will not result in sanctions
  • Sanctions under the Stark Law (governing and limiting arrangements for referral of Medicare or Medicaid patients between hospitals and physicians) may be imposed (or not) in the discretion of CMS
  • Certain payments under Medicare Advantage plans to practitioners not included in the plan's network are waived
  • Certain HIPAA requirements, if violated, will not result in sanctions for hospitals in designated geographic areas that have hospital disaster protocols in operation, including:
    • Obtaining a patient's agreement to speak with family or friends or to be included in the facility directory
    • Distributing the facility Notice of Privacy Practices (and keeping it updated, given the changes in how information may be used or disclosed)
    • Honoring a patient's requests for certain privacy restrictions or confidential communications
  • Deadlines and timetables for the performance of federally required activities may be waived to the extent determined necessary by CMS

The waiver is the official documentation following up the CMS Emergency Declaration Fact Sheet which allows, among other things:

  • Waiver of the 25-bed limit and the 96-hour average length of stay rule for CAHs
  • Relaxation of the distinction between acute hospital beds and distinct part unit (psychiatric or rehab) beds as needed

This is all uncharted territory but the general trend is clear: Hospitals and practitioners have some much-needed flexibility to function in the midst of this health crisis. Quarles & Brady's Health Law Team is continuously monitoring the ever-changing landscape of the COVID-19 pandemic. For more information please contact your Quarles & Brady attorney or:

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