On June 10, 2022, the Appellate Division of the Superior Court of New Jersey filed an opinion in Petro v. Platkin, which has been approved for publication and thus will have precedential effect. The unanimous panel affirmed an Order entered by Judge Robert Lougy on April 1, 2020, dismissing the complaint challenging the validity of the New Jersey Medical Aid in Dying Act, often referred to by the acronym MAID, which authorizes a physician to prescribe medication to be self-administered by a patient for the purpose of ending the patient’s life. The trial court had ruled that the plaintiffs did not have standing to bring the challenge. The group of plaintiffs were composed of a terminally ill patient, a physician, and a pharmacist. Nonetheless, Judge Lougy addressed the merits of plaintiffs’ asserted unconstitutionality of the MAID on various grounds. He found them without merit.

In his opinion for the Appellate Division, Judge Natali agreed with the ruling as to lack of standing. He supported this conclusion with references to People ex rel. Becerra v. Superior Ct., and Lee v. Oregon, cases in which healthcare professionals lacked standing to challenge similar legislation in California and Oregon.

In addition, the court provided an “extensive amplification” of the lower court opinion “because of the significant issues raised related to the treatment of terminally ill patients as permitted under the Act.” The plaintiffs’ theory of the case asserted the following violations: (1) the New Jersey constitutional right to defend life; (2) equal protection; (3) the rights of health care providers under the Advance Directives Act; (4) the Free Exercise Clause of the United States Constitution; (5) the common law; (6) federal statutes regulating disposal of controlled substances; (7) the physician’s right to practice medicine (8) the duty to warn pursuant to N.J.S.A. 2A:62A-16; (9) the Administrative Procedure Act because of a total lack of agency regulation; (10) the Contracts Clause of the United States Constitution; and (11) the requirement to not falsify records.

The forty-four-page opinion reviews the legislative history and structure of the MAID and evaluates the various alleged constitutional and non-constitutional defects. It quickly but comprehensively rejected these claims. An important component of this analysis is an emphasis on the voluntary nature of participation in the MAID, whether by healthcare professional or patient.

This ruling is consistent with long-standing New Jersey law regarding an individual’s right to autonomy and privacy in the making of end-of-life decisions that can be traced back to In re Quinlan, a case later recognized by the Supreme Court of the United States as “seminal” in the development of this area of the law. The Legislature recognized that legacy in setting forth the intent and purpose of this law.

It would seem unlikely that the New Jersey Supreme Court will accept the case for further review, let alone reverse the outcome. It is uncertain how the current U.S. Supreme Court might react. The Quinlan rationale was initially based on a constitutional right of privacy although later supplemented with reliance on common law informed consent principles. In Dobbs v. Jackson Women’s Health Organization, the Supreme Court overturned Roe v. Wade. This decision potentially undermines the right of privacy, especially given comments in Justice Thomas’ concurring opinion, regardless of the disclaimers in Justice Alito’s opinion for the majority. This looming development casts assessment of the Petro case in a different light.

Following the historic U.S. Supreme Court decision in Dobbs v. Jackson Women’s Health Organization overturning Roe v. Wade and Planned Parenthood v. Casey, attorneys and legal scholars are anticipating an avalanche of legal and practical issues emanating from the fact that there is no longer a federal constitutional right to obtain an abortion. Vesting individual states with the power to regulate abortion, below are three key issues to consider:

 

  1. Childcare and Family Leave

Dobbs leaves open issues related to childcare and family leave.  Although women, including those who choose to have an abortion, continue to be afforded workplace protections such as medical leave under the Family Medical Leave Act (FMLA), the opinion does not consider the impact of unpaid maternity leave on the workforce. The FMLA only provides parents with job protection for twelve weeks without guaranteed pay during that time. Childcare is prohibitively expensive for many families and without guaranteed pay, families may experience a decline in their earnings that may ultimately result in workers leaving the workforce. Additionally, women who are balancing their physical and mental health with their economic security and caretaking obligations may feel compelled to return to the workforce prematurely. Either way, families may unexpectedly face the difficult choice between rushing back to work to support their family or not returning at all to avoid mounting childcare costs. As a general matter, however, women who choose to have an abortion can still qualify for medical leave under the FMLA, Pregnancy Discrimination Act (PDA), or Americans with Disabilities Act (ADA).

 

  1. Health Insurance Coverage

The Dobbs decision leaves the regulation of abortion services to the various states. Health insurance coverage issues springing from the decision will therefore turn not on where an abortion is performed, but on state laws governing the group or individual plan that would cover the medical expenses of the insured. Group health plans, particularly those sponsored by multi-state employers, may provide coverage under plans issued by insurers where the contract situs is another state. It continues to be true that insurance plans issued in other states may provide different levels of requirements, or none at all, regarding coverage of abortions. States with legislatures disfavoring abortion may go further in prohibiting insurance coverage for abortion care or other healthcare services the state legislatures view with disfavor.

Other group health plans may be provided through self-insured ERISA plans, under which state laws that would otherwise relate to the plan are largely preempted. While it appears that a state law prohibiting coverage of abortions may not survive a challenge on the basis that it is a state law that relates to the self-insured ERISA plan, an exception to ERISA preemption applies to “generally applicable” criminal laws. Many employers have, in the wake of the Dobbs decision, announced policies of reimbursing travel for employees and their dependents to go out-of-state for abortion services. Some states have made “aiding and abetting” an abortion a criminal act. It remains to be seen whether a state will attempt to pursue criminal charges against an employer reimbursing such travel-related costs as “aiding and abetting” an abortion, and therefore argue that the criminal law is saved from the ERISA preemption of state laws.

There are currently more questions than answers concerning the impact of the Dobbs decision on group health plans maintained by employers. Initially, it seems that the greatest challenges in this area will be faced by employers whose plans have historically covered abortions, and who wish to continue to provide this benefit for their employees who live in states that will restrict abortion access in view of Dobbs. Such employers should proceed with caution in this area and, at least, consider: (1) reviewing the provider network in their group health plan and expanding it, as necessary, to provide reimbursement for services provided by out-of-state and currently out-of-network providers of abortion services; (2) if feasible to do so, changing from an insured group health plan to a self-insured plan not subject to the restrictions imposed on a carrier to pay for abortion services performed in a state in which such services could not be covered under an insured plan.

 

  1. Bioethics

Abortion has long been a bioethics topic that is polarizing and divisive. The bioethical analysis is built upon four well-established principles: (1) respect for a patient’s autonomy; (2) nonmaleficence or the “do no harm” concept; (3) beneficence involving providing helpful care; and (4) justice. While vigorous debate of all these principles is likely to resume in light of Dobbs, principles of “justice” present a particularly compelling concern. A significant component of a “justice” analysis involves an assessment of the fair distribution of benefits and burdens. This is sometimes referred to as “health equity,” which the Centers for Disease Control and Prevention (CDC) defines as a fair and just opportunity to attain their highest level of health. The CDC has recognized that achieving “health equity” requires: (1) focused and ongoing societal efforts to address historical and contemporary injustices; (2) overcoming economic, social, and other obstacles to health and healthcare; and (3) eliminating preventable health disparities.

Without access to legal abortions, the death rate linked to pregnancy and childbirth is likely to increase. Minority groups have made significant use of abortion services and losing access to abortion in their home state is likely to have a disproportionate impact on minority groups living in those states. Low-income families could also be hard hit by eliminating access to abortion services because of the expenses involved in traveling to a state where abortion services are legal and available. Furthermore, the extra-territorial enforcement of laws implicates not only the principle of justice but also infringes the constitutional right of interstate travel first recognized in Shapiro v. Thompson, 349 U.S. 618 (1969).

Among the numerous decisions making headlines by the U.S. Supreme Court in recent weeks was a lesser noted decision impacting the Medicare reimbursement to healthcare facilities across the country. In a rare unanimous decision, the Court held that the federal government improperly lowered drug reimbursement payments to hospitals and clinics that serve low-income communities.

Under the Medicare statute, the U.S. Department of Health and Human Services (HHS) must reimburse hospitals for certain outpatient prescription drugs that the hospitals provide to Medicare patients. The total reimbursement to hospitals for these prescription drugs amounts to tens of billions of dollars every year. Under the law, HHS may set the reimbursement rate one of two ways: (1) if HHS has conducted a survey of hospitals’ acquisition costs for prescription drugs, then reimbursement may be set at the average of the hospitals’ acquisition costs, or (2) if HHS has not conducted a survey, then it may set reimbursement rates at the average sales price charged by manufacturers for the drugs (with certain adjustments). In any event, HHS may not vary the reimbursement rates for different groups of hospitals. However, in 2018 and 2019, despite not having conducted a survey, HHS substantially reduced the reimbursement rates for Section 340B hospitals, placing at issue about $1.6 billion annually. In its opinion, the Court addressed whether HHS had sufficient discretion to vary the reimbursement despite having not conducted a survey.

The government argued that 340B hospitals, because of their special status serving low-income communities, are able to buy drugs at a deep discount. Thus, HHS believed that by reimbursing 340B hospitals the same as all other hospitals, it created an incentive for the 340B hospitals to overprescribe the drugs or prescribe more expensive drugs. HHS also argued that by lowering the reimbursement it would save Medicare beneficiaries on their co-payments since they are linked to reimbursement rates. However, the Court was not persuaded by these or the other arguments raised by the government. Instead, the Court held that the government failed to abide by the express requirements of the Medicare statute. It therefore remanded the case back for further proceedings consistent with its opinion.

The decision serves as a significant win for providers of low-income care and is likely to result in significant additional reimbursement for these harmed facilities. Additionally, the Court’s decision should serve as a stern message to HHS that it must act consistent with the Medicare statute if it wishes to cut reimbursement rates, and cannot simply act based on its own perceived good intentions. Providers participating in the 340B drug pricing program should assess their individual reimbursement shortfall, if any, as the outcome of this litigation may result in an opportunity to seek additional reimbursement.

In 2016, Congress passed the 21st Century Cures Act to drive the electronic access, exchange, and use of health information. On March 9, 2020, the U.S. Department of Health and Human Services (HHS) Office of the National Coordinator for Health IT (ONC) released its Final Rule, which established exceptions to the Act’s information blocking provision and adopted new health information technology certification requirements to enhance patients’ no-cost smartphone access to their health information through the use of application programming interfaces (APIs).

For the past two years, healthcare providers have been working to implement the various requirements of the Cures Act Final Rule and comply with ONC’s implementation timeline. Coming up later in 2022 are two new requirements impacting both providers and health IT developers.

First, beginning on October 6, 2022, the electronic health information definition will expand and no longer be limited to the data elements represented in the United States Core Data for Interoperability (USCDI). Thus, healthcare providers will need to be prepared to provide their patients with access to this additional information. Also, health IT developers will need to adopt the new HL7 FHIR APIs, which will further promote interoperability by allowing patients to aggregate their health information more easily. Health IT developers will also need to certify to several new certification criteria to promote new standards for data access and exchange.

Healthcare providers should be working hand-in-hand with their health IT developer to ensure that these new requirements are being met in order to avoid facing claims of information blocking. Providers must remain focused as these additional Cures Act Final Rule requirements take effect, further changing the landscape of patients’ rights to access their personal health information and placing new obligations on providers to make this information accessible. Additionally, this is a good time for providers to confirm that their internal procedures continue to follow all Cures Act Final Rule requirements to ensure that any limitation on the access of patient information falls within one of the information blocking exceptions, as enforcement activities are expected to increase at some point during the remainder of 2022 or possibly into 2023.

Economics 101 taught us that in a capitalist economy, prices are generally set by the market. This is also true, by and large, for healthcare services planned in advance – for providers in-network, insurers negotiate these rates. For providers out-of-network, healthcare consumers can agree to either pay the amount charged less the out-of-network reimbursement or move on to another provider. A condition precedent for this to work smoothly is ensuring the consumer knows the network status of the provider, the amount they will charge for the service to be provided, and the amount, if any, to be reimbursed by an insurer for the out-of-network services. Notice requirements, then, are the first prong of the federal No Surprises Act and many of the state laws aimed at this issue.

Economics 101 also taught us that market pricing doesn’t work when there is a monopoly on the service or supply. The hospital closest to where you got hit by that bus, and the anesthesiologist you met for the first time in the operating room who you had no voice in selecting or making any agreement with, have the ultimate monopolies. For many years this subjected the patient to possibly astronomical costs with no recourse.

During my tenure at the Department of Banking and Insurance, this author represented the Department on an ad hoc work group chaired by Assemblyman Gary Schaer and ably assisted by Dave Knowlton of the NJ Health Care Quality Institute. Payers and providers were also represented. The group was to study the issue of these surprise bills and make recommendations. If there is no contract and no ability to choose in advance, how are the prices for these essential medical services to be set?  We anticipate parties in a capitalist system acting in their economic self-interest.  For carriers this is the lowest reimbursement; for providers it is the highest, which catches the healthcare consumer in the middle to make up the difference. The next prong of the No Surprises Act and its state progeny, therefore, is a prohibition on balance billing to keep the patients who had no role in selecting the provider from being whipsawed by these competing interests.

Insurers and providers may be able to reach agreement on a level of reimbursement that provides fair reimbursement without balance billing, which could be the end of it. But if they don’t?  Enter the next prong of the No Surprises Act, an Independent Dispute Resolution process.  Independence takes the economic self-interest of the parties out of the equation, but in and of itself doesn’t get to what constitutes fair reimbursement, which would reasonably consider such factors as the level of training or experience of the provider, the quality and outcomes measurements of the provider or facility, the market share held by the out-of-network provider or carrier in the geographic region, the patient acuity and complexity of services, the teaching status, case mix, and scope of services of the facility, any good faith effort—or lack thereof—to join the insurer’s network, and, most controversially, average payments to network providers.

In a series of upcoming blog posts, we will take a deeper dive into the law, regulations and court challenges associated with each prong of the No Surprises Act and related issues. Stay tuned.

New Jersey has proposed additional legislation (A4091 and S2729) to adopt the state’s County Option Hospital Fee Pilot Program on a permanent basis. The proposed legislation is currently being reviewed by the Senate Budget and Appropriations Committee and it is anticipated it will be enacted, expanding the program from the current seven participating counties (Atlantic, Camden, Essex, Hudson, Mercer, Middlesex, and Passaic) to include five counties (Bergen, Burlington, Cumberland, Monmouth, and Ocean).

By way of background, New Jersey adopted the County Option Hospital Fee Pilot Program Act on November 1, 2018. The goals of the pilot program are (1) to increase financial resources through the Medicaid program to support local hospitals and ensure they continue to provide necessary services to low-income citizens; and (2) to provide participating counties with new fiscal resources.

Under the pilot program, the initial seven participating counties are authorized to impose a local healthcare related fee on hospitals within their borders. The funds collected from the fee are subject to a federal match, provided they do not exceed the federal Department of Human Services (DHS) limit.

At least 90% of the funds collected from the fee imposed are to be used for the benefit of hospitals within the county to ensure they continue to provide necessary services to low-income citizens. Specifically, such funds may be used to: (1) increase Medicaid/NJ FamilyCare payments to hospitals in the county; (2) make payments to Medicaid/NJ FamilyCare managed care organizations operating in the participating county for increased hospital or hospital-related payments; and/or (3) pay costs directly related to the administration of the pilot program.

As a pilot program, the County Option was intended to last only five years, which would begin to run 180 days after its November 1, 2018 enactment.  However, due to delays in obtaining federal approval of the program, in 2021, the State Legislature clarified that the five-year period would not begin to run until each participating county had begun to collect the healthcare related fee.  The pilot program is now scheduled to expire in the fall of 2026. However, the proposed legislation would make the program permanent.

Hospitals in Bergen, Burlington, Cumberland, Monmouth and Ocean counties should pay close attention to this proposed expansion of the program and begin analyzing the potential impact on their Medicaid reimbursement.

The COVID-19 Fraud Enforcement Task Force was established in May 2021 to utilize the resources of the U.S. Department of Justice (DOJ) and various governmental agencies to combat COVID-19-related fraud. These efforts have led to investigations and prosecutions involving Paycheck Protection Program (PPP) fraud as well as healthcare-related COVID-19 fraud, the extent, and implications of which is only now becoming clear.

The DOJ is looking to cast a wide net around what it sees as healthcare-related COVID-19 fraud. Kevin Chambers, Director for COVID-19 enforcement for the DOJ, has described such coordinated efforts as “extraordinary” with the purpose being “to prosecute some of the largest and most-wide ranging pandemic frauds detected to date.”

At this writing, nearly two dozen defendants from across the U.S. have been charged for their alleged participation in such schemes. Federal law enforcement agencies that are involved include the Federal Bureau of Investigations, Department of Homeland Security; Department of Health and Human Services Office of the Inspector General, Food and Drug Administration Office of Criminal Investigations; and the Postal Inspection Service.

The subjects and targets of healthcare-related COVID-19 fraud cases vary from alleged bogus telemedicine encounters, to falsifying COVID-19 vaccination cards, to misuse of relief funds – and from medical professionals to manufacturers and distributors, respectively. In Florida, a medical professional was charged with healthcare fraud for allegedly billing bogus telemedicine encounters that did not legitimately occur during the pandemic. In California, a pharmacy director was accused of using actual vaccine lot numbers to falsify COVID-19 vaccination cards. Here in New Jersey, a postal service employee was charged with conspiracy for allegedly participating in a scheme to distribute fraudulent COVID-19 vaccination record cards to unvaccinated people. In Pennsylvania, an individual was charged with knowingly creating and possessing an unauthorized COVID-19 vaccination card, which bore an official government insignia.

Charges have also been brought against individuals for misappropriating the CARES Act Provider Relief Fund (PRF) monies meant to reimburse eligible medical providers for increased costs or lost revenue caused by the COVID-19 pandemic. An individual in California who owned and operated healthcare and hospice companies pleaded guilty to theft of government property because of his misuse of PRF monies, misappropriating nearly $200,000 worth of allocated PRF monies for personal use rather than for its intended purpose – to ensure continued relief and access to medical care. Moreover, the Center for Program Integrity, as a part of the Centers for Medicare & Medicaid Services has taken corresponding administrative actions against medical providers accused of such alleged wrongdoings.

It may become challenging for the government to discern between PPP loan borrowers that intended and affirmatively acted to commit fraud and those that were well-intentioned but nonetheless failed to comply with this fast-tracked federal relief program. As a result, many unwitting borrowers may find themselves caught in the DOJ’s fishnet of fraud charges. It is therefore critical for healthcare entities that received PPP funds to immediately review their compliance, mitigate any non-compliance, and address corrective measures and exposure to enforcement with the appropriate government agency. Moreover, healthcare providers, owners and executives of medical businesses, physicians, and healthcare marketers and manufacturers should keep careful track of their billing practices, including billing for telemedicine, and institute safeguards to ensure COVID-19 relief funds are not being intentionally or negligently misused.

 

Generally speaking, licensed physicians in New Jersey cannot practice medicine in just any corporate form. But for a limited number of exceptions listed in N.J.A.C. 13:35-6.16, a general business corporation cannot employ a physician to provide healthcare services.  This is known as the prohibition against the corporate practice of medicine, or as we healthcare lawyers affectionately refer to it, CPOM.

The reason for the CPOM doctrine is that an inherent conflict exists between a physician’s obligation to provide medical care to his or her patient and the general business corporation’s motive to maximize profits.  The goal of CPOM is to remove the burden on physicians of choosing between providing appropriate medical care to their patients and being influenced by shareholders who are laypersons. The CPOM rule is enforced by the New Jersey Board of Medical Examiners (BME).

With this background, there are several ways physicians may structure their practices:

  • As a solo medical practice with other employed professionals, including other physicians. It is important to note that in this structure, the physician, as the plenary licensed professional, must employ and supervise the limited licensed professionals such as nurses or physician assistants.
  • As a partnership, professional association, or limited liability company, so long as the practice entity is composed solely of healthcare professionals who are licensed or authorized to provide the same or closely allied professional services.  Oftentimes, a plenary license physician wants to form a partnership with a limited licensed practitioner. This is not strictly prohibited but the physician must, at a minimum, maintain a greater ownership interest in the entity than the limited licensed partner. This is true whether the physician is in partnership with one or several limited licensed professionals – e.g., the physician must always maintain at least a 51% interest in the entity.
  • Through an associational relationship (e.g., as an employee or independent contractor) with another physician or professional entity; however, the physician’s license may not exceed the scope of the hiring practitioner’s license.
  • In certain circumstances, a physician may have an equity or employment interest in a professional practice that is a limited partner in a general business corporation that has a contractual relationship with a professional service entity. In this model, the general business corporation may contract to provide administrative services, such as management services, hiring of non-professional staff, provision of office space and equipment, and billing services.  The physician must ensure that an appropriate licensed healthcare professional determines and implements all medical services and policies, including decisions regarding patient fees and waiver of those fees, and must ensure that the general business corporation makes no representations to the public, under its own corporate name, about offering healthcare services which require licensure.

In the case of Allstate Insurance Company v. Northfield Medical Center, P.C., the New Jersey Supreme Court issued its most recent pronouncement on the CPOM doctrine. Suffice it to say, the CPOM doctrine is alive and well and provides important guidance to providers:

  • A plenary licensed physician and a limited licensed (allied) healthcare professional cannot together own a medical practice that results in its control and direction by the limited licensed healthcare professional. In addition, an unlicensed individual cannot own a medical practice with a licensed healthcare professional.
  • A general business corporation cannot employ or otherwise engage, for example, through an independent contractor relationship, a healthcare professional.

In light of the Supreme Court’s ruling, it is more important than ever to structure the management services organization (MSO) model between a management company, on the one hand, and a physician or medical practice, on the other, carefully to stay within the parameters of the CPOM rules.  Special attention needs to be paid to the terms of the management services contract and the manner in which it is implemented and operationalized.

This was the dilemma faced by the Court in Northfield Medical Center. Through an interwoven web of space rental leases, equipment leases, and management contracts, a chiropractor-owned management company was able to syphon profits from and maintain control over an affiliated medical practice. Although the majority of stock in the medical practice was owned by the physician, (1) the physician did not participate in day-to-day patient care, (2) medical practice profits were turned over to the management company in exchange for the provision of management services, leased space, and leased equipment, (3) the physician-owner of the medical practice signed an undated resignation letter and affidavit of non-issued or lost certificate bearing an unexecuted notary attestation for the physician’s signature and date, which permitted the chiropractor to remove the physician, and (5) the leases between the management company and the medical practice included a “break fee” of $100,000 intended to penalize the medical practice’s physician-owner for breaking the lease.

The New Jersey Supreme Court found that a factfinder could reasonably conclude the structure was “little more than a sham intended to evade well-established prohibitions and restrictions governing ownership and control of a medical practice by a non-doctor.”  Physicians, limited-licensed professionals, and lawyers alike are on notice that they will be imputed with knowledge of what the CPOM law requires, and conduct intended to protect an investment and circumvent these rules will not be tolerated.

The CPOM doctrine comes into play in virtually every multi-disciplinary practice structure, management contract negotiation, and private equity transaction. In all circumstances, control over and supervision of the clinical aspects of the medical practice and patient care must remain with the plenary licensed physician.

The occurrence, prevention, and consequences of burnout among healthcare professionals have been matters of concern and study since the 1960s. The concept of burnout encompasses emotional and psychological job-related stress in any health practice environment with resulting negative impacts on job satisfaction, job performance, and patient outcomes. Both physicians and nurses experience burnout which may be manifested with higher rates of depression, fatigue, and anxiety. A higher rate of substance abuse, increased incidents of sleep disturbances, damaged relationships and even increased rates of suicide have been reported. Physician burnout can also appear as a loss of interest in and enthusiasm for work as well as increased frustration and emotional exhaustion. Decreased empathy for patients as well as diminution in a sense of personal worth and professional accomplishment may be present. There may also be an onset of post-traumatic stress disorder (PTSD).

The prolonged pandemic associated with COVID-19 was expected to intensify physician burnout. A recent survey published in March 2022 by BMC Health Services Research adds supportive data and information for further evaluation.  This study was conducted in June 2020 and again in December and January 2021. These were the first two waves that occurred before the Delta and Omicron virus variants had spread. The authors focused on five groups of medical practitioners: (1) primary care physicians, (2) hospitalists, (3) critical care and pulmonary intensivists, (4) emergency medicine physicians, and (5) infectious disease physicians. In the first wave, emergency medicine physicians had the highest burnout score but in contrast they had the lowest scores in the second wave. The article attributes this as possibly due to institutional or personal adaptation to the pandemic. For all other specialties, the burnout scores increased with the highest scores coming from the hospitalists. Hospitalists are the principal segment of physicians who dealt with increasing caseloads of COVID-19 patients who were often hospitalized for prolonged periods of time.

Many resources have become available for dealing with the prevention and management of physician burnout. For example, the American Medical Association has a STEPS Forward program that can be utilized for ways to reduce burnout. In March 2022, President Biden signed into law the Dr. Lorna Breen Health Care Provider Protection Act. 42 U.S.C. § 294n. This law authorizes the Department of Health and Human Services to award grants for programs to promote mental health and resiliency among health care providers. It was passed with a recognition of COVID-19 having worsened the high levels of stress and burnout experienced by healthcare providers.

 The increases in physician burnout prompt concerns for increased legal risks. Extensive literature has explored this topic. However, a recent study published in April 2022 by Health Affairs challenges that proposition. The researchers reviewed Medicare data for over 1,000 patients with a hypothesis that physicians reporting more frequent episodes of burnout or having developed increased callousness to patients would experience higher Medicare costs or more frequent bad outcomes. In the context of this study, the researchers found that physicians who had self-reported experiencing several episodes of burnout had lower rates of undesirable outcomes. While not suggesting that burnout was beneficial or that attempts to reduce burnout should not be pursued, they noted that physicians who self-reported burnout were more conscientious and gave more effort to providing good care to their patients.

This study, while having a limited sample size, provides support for programs for physician empowerment, wellness, and resilience. Participation in such programs can lead to insight and improved health.

Signed into law by President Joe Biden in March 2022, the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act of 2021 amended the Federal Arbitration Act (FAA) to effectively ban the pre-dispute arbitration of sexual harassment and sexual assault claims. Although this important legislative update has often been framed within the employment context, it is important for all employers, including those in the healthcare industry, to note that the sweeping ban on sexual assault and sexual harassment arbitration agreements does not appear to be limited to claims arising solely within the workplace.

The new law’s broad definition of the term “pre-dispute arbitration agreement” as “any agreement to arbitrate a dispute that had not yet arisen at the time of the making of the agreement” does not explicitly exclude agreements outside of employment agreements. Additionally, the law’s definitions of the terms “sexual assault dispute” and “sexual harassment dispute” do not explicitly limit conceivable claims to the workplace.

Importantly, many states have civil statutory frameworks outlawing sexual harassment/assault that provide for a cause of action for sexual harassment/sexual assault outside of the employment context (such as the public accommodation provisions in the New Jersey Law Against Discrimination – NJLAD). Employers should therefore closely consider how the new law might also affect arbitration agreements with customers, clients, and/or patients that limit premises liability.  Insurance rates could also be impacted, as the cost of defending these claims in state court are often much higher than through arbitration.

Since the passage of the first amendment to the FAA, the House has passed a second bill amending the FAA that would extend the ban on pre-dispute arbitration agreements to future employment, consumer, antitrust, and civil rights claims. Notably, this second proposed amendment defines “employment” and “civil rights” claims broadly enough to include the full panoply of federal and state employment discrimination/civil rights claims, and explicitly includes claims arising from alleged discrimination in – among other places – “public accommodations and facilities” and “healthcare.”

Although the first FAA amendment passed mostly along party lines with limited bipartisan support, the pending second amendment is expected to garner far more contention and debate in the Senate along the usual party lines. As of now, it appears that the second amendment may narrowly pass in the Senate if Democrats can maintain their partisan coalition that led to passage of the first amendment. However, this outcome assumes that the vote takes place before the mid-term elections in November 2022, which remains uncertain. Regardless, the recent changes to the FAA and the potential future changes should be closely reviewed by healthcare providers.