OF DIGITAL INTEREST
OF DIGITAL INTEREST
Legal news and analysis of all things digital
OF DIGITAL INTEREST
Legal news and analysis of all things digital

Trending in Telehealth: October 29 – November 11, 2024

by , and | Nov 19, 2024 |

Trending in Telehealth highlights state legislative and regulatory developments that impact the healthcare providers, telehealth and digital health companies, pharmacists, and technology companies that deliver and facilitate the delivery of virtual care.

Trending in the past week:

  • Interstate compacts
  • Behavioral health
  • Veterinary services
  • Disciplinary guidelines

A CLOSER LOOK

Proposed Legislation & Rulemaking:

  • In Washington, the Veterinary Board of Governors proposed amendments to board regulations to address the provision of veterinary services via telehealth. The proposed rule would permit licensed veterinarians to use telehealth to provide general health advice and emergency animal care advice, prescribe non-controlled substance sedation medication to facilitate transportation to an in-person visit, and, in certain circumstances, to dispense non-controlled substance medications prescribed by another veterinarian. Once a veterinarian-client-patient relationship had been established, the proposed rule would permit ongoing care to be provided via telemedicine.
  • In California, the Board of Behavioral Sciences proposed amendments to its telehealth rule to require licensed providers rendering services via telehealth to employ technologies, methods, and equipment that comply with all applicable federal and state privacy, confidentiality, and security laws, including HIPAA and the California Confidentiality of Medical Information Act.
  • South Carolina’s Department of Public Health released a proposal to permit licensed opioid treatment programs to perform the required initial screening examination via telehealth for patients admitted for treatment with buprenorphine or methadone. The proposed rule would require the use of audio-visual communications when evaluating patients for treatment using Schedule II medications but would permit use of audio-only platforms when treating patients with Schedule III medications.

Finalized Legislation & Rulemaking Activity:

  • The Florida Board of Clinical Social Work, Marriage and Family Therapy, and Mental Health Counseling finalized a set of guidelines that the board must follow when imposing disciplinary penalties upon telehealth registrants. The penalties include fines, reprimands, suspension with a corrective action plan, and revocation of the individual’s license.
  • In the District of Columbia, the mayor signed a bill (B 25-287) in which DC joins the Interstate Counseling Compact.

Why it matters:

  • Adoption of interstate licensure compacts continues to grow. Over the past year, there has been a notable trend of adoption of interstate licensure compacts for a wide range of providers. Even during slow periods for legislative and regulatory activity, DC’s adoption of the Interstate Counseling Compact reflects continued interest in these compacts.
  • States continue to adapt to the ongoing relevance of telehealth as a method of care delivery. The rule amendments proposed in Washington to permit the delivery of veterinary services via telehealth reflects ongoing recognition that telehealth can be used to provide a wide range of health services. The recently adopted disciplinary guidelines in Florida demonstrate how states have begun to adopt regulations specifically with telehealth in mind.

Telehealth is an important development in care delivery, but the regulatory patchwork is complicated. The McDermott Digital Health team works alongside the industry’s leading providers, payors, and technology [...]

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Trending in Telehealth: October 21 – 28, 2024

by , and | Oct 31, 2024 |

Trending in Telehealth highlights state legislative and regulatory developments that impact the healthcare providers, telehealth and digital health companies, pharmacists, and technology companies that deliver and facilitate the delivery of virtual care.

Trending in the past week:

  • Professional standards
  • Marriage and family therapy services
  • Advance practice registered nurses (APRNs)

A CLOSER LOOK

Finalized Rulemaking:

  • The Arkansas Department of Health adopted a final rule setting forth requirements for the provision of marriage and family therapy services. The rule defines telemedicine and requires that a therapist-client relationship be established prior to the delivery of telemedicine services. Counselors and therapists also must document the treatment record, establish protocols for emergency services referrals, and provide the client with an electronic or hard copy of the treatment record documenting the encounter, if requested. While group therapy may be delivered via telemedicine, the rule precludes the use of group therapy for individuals 18 years of age or younger.
  • The Arkansas Board of Nursing adopted a final rule imposing requirements for APRNs providing care via telemedicine. Like the rule promulgated by the Department of Health, this rule requires APRNs to establish an APRN-patient relationship prior to the delivery of telemedicine services. An APRN rendering telemedicine services in Arkansas must be licensed to practice nursing in the state and cannot prescribe controlled substances unless the APRN has seen the patient for an in-person exam or a relationship exists through consultation or referral.

Why it matters:

  • States continue to implement rules to ensure that virtual care is delivered effectively, safely, and ethically. The Arkansas Department of Health and Board of Nursing enacted similar regulations, mandating that practitioners adhere to specific professional standards, including those related to scope of practice and licensure.
  • With the election less than one week away, legislative and regulatory activity remains slow. We anticipate an uptick in telehealth-related activity once the election concludes.

Telehealth is an important development in care delivery, but the regulatory patchwork is complicated. The McDermott digital health team works alongside the industry’s leading providers, payors, and technology innovators to help them enter new markets, break down barriers to delivering accessible care, and mitigate enforcement risk through proactive compliance.



Trending in Telehealth: October 14 – 21, 2024

by , and | Oct 25, 2024 |

Trending in Telehealth highlights state legislative and regulatory developments that impact the healthcare providers, telehealth and digital health companies, pharmacists, and technology companies that deliver and facilitate the delivery of virtual care.

Trending in the past week:

  • Medical practice standards
  • Maternal care
  • Opioid treatment

A CLOSER LOOK

Proposed Legislation & Rulemaking:

  • The Massachusetts Executive Office of Health and Human Services Division of Medical Assistance proposed a rule to establish requirements for the participation of programs of assertive community treatment (PACTs) in MassHealth. Each PACT provider may render services via telehealth, with justification for each instance of telehealth use documented and supported in the member’s record. The PACT provider also must be available to respond to member needs 24 hours per day, seven days a week, 365 days a year by phone, in person, or via telehealth whenever appropriate or safe. This includes ongoing or crisis services determined by member need.

Finalized Legislation & Rulemaking:

  • North Carolina adopted an emergency rule mandating that opioid treatment program (OTP) counseling staff be available, either in person or by telehealth, a minimum of five days per week. OTPs must establish and implement policies to determine the appropriateness of telehealth services that take into consideration the patient’s choice along with the patient’s behavior and physical and cognitive abilities. The patient’s verbal or written consent must also be documented when telehealth services are provided.

Why it matters:

  • States are proposing rules to ensure that healthcare providers are available around the clock to respond to patient needs through telehealth. Massachusetts’s PACT rule would require 24/7 provider availability, whether in person or via telehealth.
  • States continue to implement informed consent requirements for telehealth providers. North Carolina OTP providers must obtain written consent prior to rendering telehealth services.
  • As the election approaches, both legislative and regulatory activity remain slow.

Telehealth is an important development in care delivery, but the regulatory patchwork is complicated. The McDermott digital health team works alongside the industry’s leading providers, payors, and technology innovators to help them enter new markets, break down barriers to delivering accessible care, and mitigate enforcement risk through proactive compliance.



Trending in Telehealth: October 7 – 14, 2024

by , and | Oct 18, 2024 |

Trending in Telehealth highlights state legislative and regulatory developments that impact the healthcare providers, telehealth and digital health companies, pharmacists, and technology companies that deliver and facilitate the delivery of virtual care.

Trending in the past week:

  • Speech language pathology
  • Mental health and substance use disorder treatment

A CLOSER LOOK

Proposed Legislation & Rulemaking:

  • Illinois introduced to amend its insurance code to require coverage for speech therapy services that a treating provider deems medically appropriate as treatment for stuttering, regardless of whether the services are provided in person or via telehealth, as of January 1, 2026. Coverage would include the use of any communication technology, applications, or platforms that comply with the applicable privacy provisions of the federal Health Insurance Portability and Accountability Act of 1996.
  • The District of Columbia Department of Health Care Finance proposed a rule regarding the provision of medication therapy management services by pharmacists under the district’s Medicaid program, in accordance with the requirements of 29 DCMR § 910, which establishes the department’s standards for the provision of telemedicine services. The services, which are aimed at optimizing therapeutic outcomes for Medicaid beneficiaries, are limited to one initial visit and three follow-up visits per calendar year and may be provided in person or via telehealth.

Finalized Legislation & Rulemaking:

  • Alaska enacted HB 126, which authorizes associate counselors to provide certain services via telehealth. The legislation also extends certain immunity protections to providers who volunteer to provide services without pay through a medical clinic, medical facility, nonprofit facility, temporary emergency site, or other governmental facility, if acting within the scope of their responsibilities in such organization.
  • Pennsylvania’s upper house passed HB 2268, which, if signed by the governor, will mandate insurance coverage of rehabilitative speech therapy treatments for individuals with childhood stuttering and neurological stuttering.

Why it matters:

  • States are increasingly relying on telehealth to expand access to speech-language pathology services. Pennsylvania and Illinois took steps this week to expand access to such services, particularly for treatments involving stuttering therapy.
  • States continue to use telehealth as a means to address mental health and substance use disorders. Last week, Mississippi enacted a final rule to allow community service providers to perform substance use assessments either in person or via telehealth. Continuing this trend, this week Illinois expanded insurance coverage for behavioral health benefits with the goal of enhancing equity in mental health and substance use treatment. We expect to see a continued uptick in this activity going forward.

Telehealth is an important development in care delivery, but the regulatory patchwork is complicated. The McDermott digital health team works alongside the industry’s leading providers, payors, and technology innovators to help them enter new markets, break down barriers to delivering accessible care, and mitigate enforcement risk through proactive compliance. Are you working to make healthcare more accessible through telehealth? Let us help you transform telehealth.



360 Diligence for Digital Health Investments: What to Watch in Today’s Market Trends

by , , and | Oct 17, 2024 |

Contributors: Dudley Baker, Managing Director, Holihan Lokey | Luiz Greca, Managing Director, Holihan Lokey | Chris Schickling, Managing Director, Gallagher

The digital health industry is complex and highly regulated, presenting unique challenges for investment in this space – especially for investors new to the healthcare industry. Healthcare companies have business lines and regulators that do not exist in other sectors of the economy, making it crucial to work with advisors that understand the value proposition of a healthcare business, where value resides amongst potential targets, and how valuations may vary. These complexities, coupled with current market trends, amplify the need for comprehensive diligence strategies to stratify risk and maximize value from advisors that understand the nuances of the healthcare sector.

In this article, we discuss the top three trends we’re seeing in digital health investment and how Gallagher, Houlihan Lokey, and McDermott Will & Emery can position your organization for success from pre-acquisition diligence to post-close operations.

Heightened Scrutiny on Healthcare Transactions and Physician Practice Management Structures

Healthcare transactions and physician practice management structures (sometimes referred to as the “friendly PC model”) are facing heightened scrutiny at both the state and federal levels. Regulators are imposing new requirements on parties and applying stricter transaction review standards, creating hurdles for healthcare investors and companies that may impact their ability to execute transactions and management relationships, and upend standard transaction timelines. For example, state laws like the recently passed and subsequently vetoed California’s AB 3129 seek to implement transaction notification and approval requirements that could present new obstacles to closing transactions and may extend pre-closing timelines. This bill would have also changed in the ways in which management companies and physician groups arrange for support services. Although Governor Newsom vetoed AB 3129, there is a newfound wave of support at both the state and federal levels to further regulate private investment in, and control of, healthcare organizations that continues to gain momentum. Oregon and Massachusetts are examples of other states that have considered similar legislation.

McDermott’s specialized focus on healthcare dealmaking and our scrutiny of the federal and state regulatory landscape helps investors and health companies stay ahead of legal developments, understand implications of proposed regulations, ensure compliance with federal and state agencies, and chart a course to move transactions through the review process efficiently.

Strengthening Cybersecurity

The healthcare sector is particularly vulnerable to cybersecurity issues and continues to be highly targeted for cybercrime. The health sector has historically under-invested in cybersecurity personnel and technology and is increasingly being targeted by sophisticated ransomware and other malicious threat actors.

In recent years, attacks on healthcare providers, insurers, and health technology vendors have resulted in catastrophic cyberattacks that have compromised patient data, resulted in a wave of class action litigation, and resulted in regulatory scrutiny and new regulations of the healthcare industry. These incidents are also incredibly expensive to contain, investigate, and remediate. In fact, according to the 2024 IBM-Ponemon Cost [...]

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