We use cookies to better understand how you use our site and to improve your experience by personalizing content. Please review our updated Privacy Policy and Terms of Use. If you accept the use of cookies, please click the "I accept" button.I acceptI declineX
Skip navigational links

Teaching Hospital Update - June 8–12, 2009


Email Alert

By Reesa N. Handelsman*

June 12, 2009

Senate Passes Landmark Bill: FDA to Regulate Tobacco

The U.S. Senate joined the House in passing landmark legislation to regulate tobacco by a vote of seventy-nine to seventeen.

The New York Times (Times) reports that "More than four decades after the surgeon general declared smoking a health hazard, the Senate on Thursday cleared the final hurdle to empowering federal officials to regulate cigarettes and other forms of tobacco for the first time. The legislation, which the White House said President Obama would sign as soon as it reached his desk, will enable the Food and Drug Administration to impose potentially strict new controls on the making and marketing of products that eventually kill half their regular users. The House, which passed a similar bill in April, may vote on the Senate version as soon as Friday."

"The Family Smoking Prevention and Tobacco Control Act, as it is called, stops short of empowering the F.D.A. to outlaw smoking or ban nicotine—strictures that even most antismoking advocates acknowledged were not politically feasible and might drive people addicted to nicotine into a criminal black market. But the law would give the F.D.A. power to set standards that could reduce nicotine content and regulate chemicals in cigarette smoke. The law also bans most tobacco flavorings, which are considered a lure to first-time smokers . . . The law would also tighten restrictions on the marketing and advertising of tobacco products. Colorful ads and store displays will be replaced by black-and-white-only text. Beginning next year, all outdoor advertising of tobacco within 1,000 feet of schools and playgrounds would be illegal. And cigarette makers will be required to stop using terms like 'light' and 'low tar' by next year and to place large, graphic health warnings on their packages by 2012."

The Times reports that "the law would be the first big federal step against smoking since the 1971 ban against tobacco advertising on television and radio and the 1988 rules against smoking on airline flights—but potentially much more sweeping than either of those moves." The paper also notes, "Although the nation's smoking rate has gradually declined in recent years, an estimated one in five people in this country still smoke. And more than 400,000 of them die each year from smoking-related disease."

The Wall Street Journal reports that "one key question is whether the bill's advertising restrictions will undo industry efforts to compensate for declining cigarette sales by moving aggressively into smokeless products. Several companies have begun developing "snus"—spit-free smokeless tobacco in pouches—and dissolvable tobacco pellets . . . While controversial, some research shows that smokeless tobacco products may be less harmful because they generally contain fewer carcinogens than cigarettes and don't enter the lungs."

Kaiser Daily Health Policy Report, Senate Passes Landmark Bill: FDA To Regulate Tobacco, Henry J. Kaiser Fam. Fdn. (June 12, 2009).

Flu Reaches Pandemic Level, WHO Says

The World Health Organization on Thursday declared a global flu pandemic in response to this year's outbreak of the HIN1 influenza A virus, commonly referred to as swine flu. It is the first pandemic in forty-one years. "I have raised the level from phase 5 to phase 6," said WHO Director-General Margaret Chan, who added that the world is now at the beginning of an influenza pandemic. "We are at the earliest phase," said Chan, adding that no previous pandemic has been detected so early or watched so closely in real time. Phase 6, like phase 5, shifts national and local actions from preparedness to response. Countries where the virus appears to have peaked should prepare for a second wave, while countries with fewer cases should remain vigilant, Chan said.

Thomas Frieden, director of the U.S. Centers for Disease Control and Prevention, said the WHO declaration does not change any actions in the U.S., which has been acting as if in a pandemic. Also, the announcement does not mean that there is a difference in severity, but rather that the virus continues to spread in parts of the world. "This is not anywhere near the 1918 pandemic, for example," he said.

Jessica Zigmond, Swine Flu Reaches Pandemic Level, WHO Says, Modern Healthcare's Daily Dose (June 12, 2009) (note: registration is required to view this content).

FTC Proposes to Settle Claims Against IPA Charged With Fixing Prices Charged Payors

A settlement released June 4, 2009, by the Federal Trade Commission (FTC) for public comment would require a California physician group to stop its alleged practice of jointly negotiating prices and other terms in fee-for-service contracts entered into with payors in the Oakland, CA, area (In re Alta Bates Medical Group Inc., FTC, No. 051 0260, settlement announced 6/4/09). The settlement, if approved by the FTC, would resolve a complaint that charged that an independent practice association (IPA), Alta Bates Medical Group Inc. (ABMG), violated
Section 5 of the FTC Act, 15 U.S.C. § 45, by jointly setting prices charged to payors in the Berkeley and Oakland areas, and in refusing to deal with payors outside of the terms collectively set by the IPA.

The complaint described ABMG as a multi-specialty IPA with approximately 600 physician members, including approximately 200 primary-care physicians, that has historically negotiated risk-based group contracts with payors, through which it has received capitated payments. Since 2001, however, ABMG has also jointly negotiated fee-for-service contracts with area payors, the complaint alleged. This latter activity and a related refusal to deal outside of the IPA that was alleged by the FTC were the underlying activity giving rise to the complaint and settlement, the commission said.

Although ABMG claimed it was utilizing a lawful "messenger model" that merely coordinates contracting and forwards payor offers to IPA member physicians to preferred provider organizations (PPOs), the FTC's complaint said that the arrangement utilized by ABMG did not rely on financial or other parameters identified by individual IPA members regarding what rates or terms they would unilaterally accept. "Instead, ABMG decided, on behalf of the group, what rates and/or terms it used in its communications with the PPO health plans. Therefore, ABMG did not employ a lawful messenger arrangement," the complaint said. "Rather than employ a lawful messenger arrangement, ABMG, on behalf of its physician members, has orchestrated collective negotiations for fee-for-service contracts," it continued. "Since at least 2001, ABMG negotiated with these payors on price, making proposals and counterproposals, as well as accepting or rejecting offers, without consulting with its individual physician members regarding the prices they would accept, and without transmitting the payors' offers to its individual physician members until ABMG had approved the negotiated prices," it added.

The relief called for under the settlement specifies that ABMG may not engage in prohibited acts identified in the complaint, but does not affect its contracting practices with payors on a capitated basis. ABMG is specifically prohibited from entering into or facilitating any agreement between or among any healthcare providers to: negotiate on behalf of any physician with payors; refuse to deal or threaten to refuse to deal with any payor, regarding any term, condition, or requirement upon which any physician deals or is willing to deal; or refuse to deal with any payor other than through ABMG, FTC said. In support of this prohibition, the settlement stipulates that ABMG may not facilitate certain information exchanges or encourage, suggest, advise, pressure, induce, or attempt to induce any person to engage in any action that would be prohibited by the settlement. ABMG retains the right, however, to engage in conduct that is "reasonably necessary to form or participate in legitimate 'qualified risk-sharing' or 'qualified clinically-integrated' joint arrangements," the FTC noted. ABMG is also required to notify payors and physicians concerning the settlement and provide payors with notice that they are not bound by and may renegotiate fee-for-service contracts entered into as a result of the conduct covered by the settlement.

The FTC's announcement said the proposed settlement is subject to a thirty-day public comment period and will be finalized by the commission after those comments, if any, have been reviewed and considered.

FTC Proposes to Settle Claims Against IPA Charged With Fixing Prices Charged Payers, BNA'S HEALTH L. REP. (June 11, 2009) (note: registration is required to view this content).

HELP Committee Releases Wide-Ranging Reform Bill

The Senate Health, Education, Labor, and Pensions Committee released a 615-page bill aimed at overhauling the insurance industry, spurring healthier lifestyles, boosting quality among the provider community, and snuffing out fraud and abuse in government programs. The bill, the first one inked by Democrats to emerge in a crowded field on Capitol Hill, would also require insurance companies to cover every American, even if they are already sick or are genetically inclined to become so in the future. Other provisions include money to help defray the cost of uncompensated care; a program to help identify and tamp down hospital readmission rates; and measures aimed at making the everyday person a better consumer of healthcare services.

Called the "Affordable Health Choices Act," the bill would extend Medicaid eligibility to those with incomes at 150% of the federal poverty level, and would increase the federal government's share of the program to 100% for a period of time to help pay for the cost of the expansion. Additionally, the legislation would create state-run "gateways" or health insurance marketplaces that would give individuals and families a wide array of health plan options. The bill also includes a raft of provisions to help improve long-term and home-based care. The bill, however, does not immediately include provisions that would create a public health plan or that would require employers to offer coverage or pay a new tax.

Matthew DoBias, HELP Committee Releases Wide-Ranging Reform Bill, Modern Healthcare's Daily Dose (June 9, 2009), (note: registration is required to view this content).

UMDNJ To Pay $2 Million To Settle False Claims Issue

The University of Medicine and Dentistry of New Jersey agreed to pay the U.S. government $2 million to settle allegations of double billing Medicaid. According to a False Claims Act lawsuit and a previously resolved criminal complaint, UMDNJ's 444-bed University Hospital in Newark billed Medicaid for outpatient physician services that were also billed by faculty physicians at the hospital's outpatient centers.

"This settlement agreement relates to inappropriate actions and poor management decisions made during a period between 1993 and 2004," UMDNJ said in a written statement. "Today, UMDNJ is a changed institution. Our new leadership team has diligently implemented numerous reforms that reflect the university's full commitment to exemplary corporate citizenship, corporate governance and the highest principles of integrity and professionalism." The whistle-blower who initiated the lawsuit, psychiatrist Steven Simring, is set to receive about $800,000 of the $2 million payment to the federal government under the False Claims Act. In 2005, the university paid $4.9 million to the U.S. and New Jersey as part of a deferred prosecution agreement with the U.S. attorney's office in Newark. At the end of 2007, UMDNJ was released from the agreement and the cloud of criminal charges after two years under the lens of a federal monitor.

Gregg Blesch, UMDNJ To Pay $2 Million To Settle False Claims Issue, Modern Healthcare's Daily Dose (June 10, 2009) (note: registration is required to view this content).

Less Sleep May Mean Higher Blood Pressure

Shorter sleep duration predicted higher blood pressure, adverse changes in blood pressure, and an increased risk of hypertension over a five-year period, data from an ongoing cohort study showed. Sleep duration also played a role in diastolic blood pressure differences between African-Americans and whites, Kristen L. Knutson, PhD, and her colleagues at the University of Chicago reported in the June 8, 2009, issue of Archives of Internal Medicine.

Adjustment for multiple covariates, including snoring, attenuated but did not eliminate the effects of sleep duration on blood pressure. "Because of the major adverse health consequences of high blood pressure, the identification of a new and potentially modifiable risk factor has clinical implications," the authors concluded. "Intervention studies are needed to determine whether optimizing sleep duration and quality can reduce the risk of increased blood pressure."

Epidemiologic studies have shown an association between self-reported short sleep duration and higher blood pressure. Other studies have shown increased blood pressure after partial or total sleep deprivation, suggesting that sleep loss might lead to increased sympathetic nervous activity and higher blood pressure, the authors said. Most prior studies relied on self-reported sleep duration and quality, which has only a moderate correlation with objective measures of sleep, they continued. So, the goal of their study was to determine whether objectively measured sleep duration and quality predicted five-year incidence of hypertension and changes in systolic and diastolic blood pressure.

The study involved a subset of 670 participants in an ongoing investigation into factors associated with development of coronary disease. All of the participants had clinical examinations in 2000 and 2001, the fifteenth year of the larger, ongoing study. They also responded to questions related to sleep duration and quality.

In 2003 and 2005, the subgroup completed a sleep-related survey and underwent monitoring by wrist actigraphy. During 2005 and 2006, participants had another clinical examination and provided demographic and sleep information. After excluding patients with incomplete data and those taking antihypertensive medication, the investigators analyzed data on 535 participants. The analysis showed that 43% of participants averaged fewer than six hours of sleep each night, and only 1% averaged eight or more hours. Over five years, average systolic blood pressure increased and diastolic pressure decreased. Over the five years of follow-up, shorter sleep duration and poorer sleep maintenance were significantly associated with changes in systolic and diastolic blood pressure. Logistic regression models of hypertension showed that short sleep duration significantly increased the odds of hypertension. For each one-hour reduction in sleep duration, the likelihood of hypertension increased 37%, the authors reported.

Sleep maintenance was not associated with the risk of hypertension. In a fully adjusted model, shorter sleep duration remained a significant predictor of the five-year change in diastolic blood pressure. The association between sleep duration and hypertension declined only slightly. Associations between sleep maintenance and blood pressure were attenuated but remained statistically significant. In a fully adjusted analysis of sex-race differences in five-year blood pressure changes, sleep duration remained a significant mediator of diastolic differences between African-Americans and whites, but not systolic. A major limitation of the study as reported by the authors was the use of wrist actigraphy rather than polysomnography to monitor sleep. This did not allow assessment of sleep-disordered breathing, a known risk factor for hypertension.

Charles Bankhead, Less Sleep May Mean Higher Blood Pressure, MedPage Today (June 8, 2009).

*AHLA would like to thank Reesa N. Handelsman, Esquire (Hall Render Killian Heath & Lyman PC, Troy, MI) for providing this week's update.

AHLA Teaching Hospital Updates are intended to provide quick summaries of cutting-edge issues of interest to teaching hospitals and their counsel. Additional information and more in-depth coverage on these topics may be available from AHLA Health Lawyers Weekly and appropriate AHLA Practice Groups.

© 2019 American Health Lawyers Association. All rights reserved. 1620 Eye Street NW, 6th Floor, Washington, DC 20006-4010 P. 202-833-1100 F. 202-833-1105