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Leslie J. Levinson is co-chair of our firm's Transactional Health Law group, and a member of both the Health Law and Business Transaction groups. He has represented private and public businesses throughout his more than 30-year career. Although Les maintains an active business law practice, he concentrates on the transactional, regulatory, and compliance representation of health care and life science clients, including home care and hospice companies, physician practices, durable medical equipment companies, information technology and medical device companies, health care equipment providers and health care investors and lenders. He brings a proactive approach to problem solving by anticipating issues and implementing creative and cost-effective strategies and solutions.

He has completed more than 450 mergers and acquisitions and financing transactions.

Les is a frequent author, speaker, and commentator on health care and business matters as well as a contributor to Robinson+Cole’s health law blog, Health Law Diagnosis. Prior to joining our firm, he was a partner at Edwards Wildman, where he was the chair of the health care practice. Les serves on a number of outside advisory boards, including the National Advisory Board of Bioethics International.

Mergers + Acquisitions

In his transactional practice, Les represents health care, life science, corporate and private equity clients, and other public and privately owned companies in a wide range of domestic and cross-border merger and acquisition transactions, including leveraged buyouts. He advises buyers and sellers on structuring transactions and negotiating acquisition and financing agreements.

Venture Capital + Equity Financings

Les counsels emerging, high-growth companies and entrepreneurs in capital raise transactions, including advice in connection with investment purchase agreements, convertible notes, charter documents, stockholder agreements, and operating agreements.

General Corporate Matters

Les also maintains an active corporate and business law practice, with an emphasis on transactional matters, including M+A for both public and private companies, securities matters, credit and finance transactions, restructurings and workouts, commercial and business agreements of all kinds, and business counseling. He regularly counsels boards and board committees, and he has served as corporate secretary to public and private companies.

Regulatory

Les provides counsel to health care providers on federal and state licensure change of control, Medicare and Medicaid fraud and abuse, compliance with the Stark law, false claims, licensure, government investigations and reimbursement matters.

  • Case Western Reserve University School of Law (Juris Doctor)
  • University of Wisconsin (Bachelors)
    • B.A.

  • State of New York

Presented with the 2023 U.S.A. Deal of the Year award, in the small markets category, as part of the Global M&A Network's 15th Annual Americas and Global Markets M&A Atlas Awards in recognition of the acquisition of Medacist Solutions Group by Bluesight, the Medication Intelligence™ Company

Recipient of the M&A Atlas Awards 2025 Pharma & Devices Deal of the Year Award 

American Bar Association
Federal Regulation of Securities Section

New York State Bar Association
Health Law Section

Bioethics International
National Advisory Board

American Health Lawyers Association

Experience


Represented The Pennant Group in Acquisition of Home Health + Hospice Operations

Led The Pennant Group’s acquisition of home health, hospice, and personal care operations across Tennessee, Georgia, and Alabama from UnitedHealth Group and Amedisys Inc. The $146.5 million deal, one of the largest homecare and hospice transactions of 2025, involved 54 locations and strategically expands Pennant’s footprint into the Southeast, including certificate-of-need states such as Tennessee, and positions the company for continued growth in challenging markets.

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Represented Enexia HBM LLC in Joint Venture Agreement

Served as legal counsel to Enexia HBM LLC, a pharmacy and health-related services company headquartered in New York, NY, in its joint venture agreement with Interchange RX, LLC, an Oklahoma-based hospice pharmacy benefits manager. 

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Represented Enexia HBM LLC in Joint Venture Agreement

Represented Acentus in Acquisition by Henry Schein, Inc.

Served as legal counsel for Acentus, a national medical supplier specializing in the delivery of continuous glucose monitors for Medicare patients, in its acquisition by Henry Schein, Inc., a solutions company for health care professionals advising over 1 million customers globally to help improve operational success and clinical outcomes. The acquisition, which was announced on November 20, 2024, will see Henry Schein acquire substantially all of Acentus’ assets, and will expand its national homecare solutions platform to address the evolving needs of clients.

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Represented Acentus in Acquisition by Henry Schein, Inc.


Publications


Legal Update: DOL Proposes to Expand Availability of Companionship and Live-In Domestic Service FLSA Exemptions teaser
July 10, 2025

Legal Update: DOL Proposes to Expand Availability of Companionship and Live-In Domestic Service FLSA Exemptions

Health Law Diagnosis teaser
January 29, 2025

Health Law Diagnosis

Health Law Diagnosis teaser
November 25, 2024

Health Law Diagnosis

Legal Update: DOL Proposes to Expand Availability of Companionship and Live-In Domestic Service FLSA Exemptions teaser
July 10, 2025

Legal Update: DOL Proposes to Expand Availability of Companionship and Live-In Domestic Service FLSA Exemptions

Health Law Diagnosis teaser
January 29, 2025

Health Law Diagnosis

Health Law Diagnosis teaser
November 25, 2024

Health Law Diagnosis

Health Law Diagnosis teaser
October 1, 2024

Health Law Diagnosis

Health Law Diagnosis teaser
August 22, 2024

Health Law Diagnosis

Health Law Diagnosis teaser
July 26, 2024

Health Law Diagnosis

Health Law Diagnosis teaser
April 16, 2024

Health Law Diagnosis

Health Law Diagnosis teaser
November 6, 2023

Health Law Diagnosis

Health Law Diagnosis teaser
May 9, 2023

Health Law Diagnosis



Health Law Diagnosis teaser
October 1, 2024

Health Law Diagnosis

Health Law Diagnosis teaser
August 22, 2024

Health Law Diagnosis

Health Law Diagnosis teaser
July 26, 2024

Health Law Diagnosis

Health Law Diagnosis teaser
April 16, 2024

Health Law Diagnosis

Health Law Diagnosis teaser
November 6, 2023

Health Law Diagnosis

Health Law Diagnosis teaser
May 9, 2023

Health Law Diagnosis


News


May 11, 2026

Les Levinson Featured in 2026 Health Care Transactions Conference Interviews

Business Transactions in Health Care group chair Les Levinson was featured in two Levin Associates’ interviews conducted while he attended the American Health Law Association’s 2026 Health Care Transactions Conference from April 13-15, in Nashville, Tennessee. The first video, titled, “Expert Interviews Q2 2026 Question 4 - Practical Advice for Upcoming Healthcare Transactions,” features Les and other healthcare transactions professionals emphasizing the importance of preparation in healthcare transactions. “I would say prepare fully,” said Les. “Try to find out everything that you know or knowable about your company so that you can manage the risks that you’re invariably going to encounter throughout your transaction.” Watch the video, here. The second video, titled, “Expert Interviews Q2 2026 Question 5 - What are You Getting Wrong about the Healthcare M&A Market?” showcases Les discussing how buyers are approaching transactions with a more analytically minded approached, stating, “I think buyers are becoming much more receptive to not just doing transactions just for the sake of scale,” said Les. “They’re looking at things much more critically as opposed to feeling like ‘we need to be in a market and we need to have a certain level of scale.’” Watch the video, here.

Levin Associates
Les Levinson Featured in 2026 Health Care Transactions Conference Interviews teaser
January 13, 2026

Les Levinson Shares Insight on Hospice 2026 M&A Outlook

Hospice News
January 6, 2026

Les Levinson Shares Insight on State of M&A Activity in Late 2025

Hospice News
May 11, 2026

Les Levinson Featured in 2026 Health Care Transactions Conference Interviews

Business Transactions in Health Care group chair Les Levinson was featured in two Levin Associates’ interviews conducted while he attended the American Health Law Association’s 2026 Health Care Transactions Conference from April 13-15, in Nashville, Tennessee. The first video, titled, “Expert Interviews Q2 2026 Question 4 - Practical Advice for Upcoming Healthcare Transactions,” features Les and other healthcare transactions professionals emphasizing the importance of preparation in healthcare transactions. “I would say prepare fully,” said Les. “Try to find out everything that you know or knowable about your company so that you can manage the risks that you’re invariably going to encounter throughout your transaction.” Watch the video, here. The second video, titled, “Expert Interviews Q2 2026 Question 5 - What are You Getting Wrong about the Healthcare M&A Market?” showcases Les discussing how buyers are approaching transactions with a more analytically minded approached, stating, “I think buyers are becoming much more receptive to not just doing transactions just for the sake of scale,” said Les. “They’re looking at things much more critically as opposed to feeling like ‘we need to be in a market and we need to have a certain level of scale.’” Watch the video, here.

Levin Associates
Les Levinson Featured in 2026 Health Care Transactions Conference Interviews teaser
January 13, 2026

Les Levinson Shares Insight on Hospice 2026 M&A Outlook

Hospice News
January 6, 2026

Les Levinson Shares Insight on State of M&A Activity in Late 2025

Hospice News
December 18, 2025

Business Transactions in Health Care Team Wins “Pharma & Devices Deal of the Year” at Global M&A Network’s 7th Annual USA Middle Markets M&A Atlas Awards Gala

Global M&A Network
Business Transactions in Health Care Team Wins “Pharma & Devices Deal of the Year” at Global M&A Network’s 7th Annual USA Middle Markets M&A Atlas Awards Gala teaser
October 8, 2025

Robinson+Cole Healthcare Transactions Team Represents The Pennant Group in One of 2025’s Largest Homecare and Hospice Transactions

September 9, 2025

Les Levinson Talks Interest Rates and Valuations in Q&A on Industry M&A Activity

Hospice News
August 18, 2025

Les Levinson Discusses Impact of Proposed Exemption with Home Health Care News

Home Health Care News
August 4, 2025

Les Levinson Discusses Cross-Sector M&A

Home Health Care News
July 14, 2025

Les Levinson Interviewed on 2025 M&A Outlook

CareSmartz360

December 18, 2025

Business Transactions in Health Care Team Wins “Pharma & Devices Deal of the Year” at Global M&A Network’s 7th Annual USA Middle Markets M&A Atlas Awards Gala

Global M&A Network
Business Transactions in Health Care Team Wins “Pharma & Devices Deal of the Year” at Global M&A Network’s 7th Annual USA Middle Markets M&A Atlas Awards Gala teaser
October 8, 2025

Robinson+Cole Healthcare Transactions Team Represents The Pennant Group in One of 2025’s Largest Homecare and Hospice Transactions

September 9, 2025

Les Levinson Talks Interest Rates and Valuations in Q&A on Industry M&A Activity

Hospice News
August 18, 2025

Les Levinson Discusses Impact of Proposed Exemption with Home Health Care News

Home Health Care News
August 4, 2025

Les Levinson Discusses Cross-Sector M&A

Home Health Care News
July 14, 2025

Les Levinson Interviewed on 2025 M&A Outlook

CareSmartz360

Events


Past

Behind the Deal: What’s Driving M&A in 2026

Jan 27 2026
2026 Home Care 100 Leadership Conference
Past

Healthcare Trends to Watch

Dec 9 2025
Global M&A Network U.S.A. Growth & Deals 7th Annual Forum
Past

Behind the Deal: What’s Driving M&A in 2026

Jan 27 2026
2026 Home Care 100 Leadership Conference
Past

Healthcare Trends to Watch

Dec 9 2025
Global M&A Network U.S.A. Growth & Deals 7th Annual Forum
Past

Home-Based Care M&A Update: Headwinds and Tailwinds Impacting Home Health, Hospice, and Home Care

Sep 30 2025
Home Health Care News Webinar
Past

What’s Your Lab Really Worth? Exploring Current Market Forces and Legal Considerations

Aug 20 2025
Lighthouse Lab Services Webinar
Past

Is 2025 the Time to Transact? Keys to a Successful Outcome

Jun 4 2025
2025 Annual Conference of the Home Care & Hospice Association of New Jersey
Past

Quick Takes on M&A Rebound

Jan 20 2025
2025 "Home Care 100"
Past

Home-Based Care M&A Update: Headwinds and Tailwinds Impacting Home Health, Hospice, and Home Care

Sep 30 2025
Home Health Care News Webinar
Past

What’s Your Lab Really Worth? Exploring Current Market Forces and Legal Considerations

Aug 20 2025
Lighthouse Lab Services Webinar
Past

Is 2025 the Time to Transact? Keys to a Successful Outcome

Jun 4 2025
2025 Annual Conference of the Home Care & Hospice Association of New Jersey
Past

Quick Takes on M&A Rebound

Jan 20 2025
2025 "Home Care 100"

Health Law Diagnosis


Below is an excerpt of the Health Law Diagnosis blog posts authored by Leslie.

Massachusetts Enhances Regulatory Oversight of Health Care Transactions on For-Profit and Private Equity Investments

This post is co-authored by Seth Orkand, co-chair of Robinson+Cole’s Government Enforcement and White-Collar Defense Team. Massachusetts has expanded regulatory oversight of health care transactions by imposing False Claims Act liability on health care owners and investors for changes including failure to disclose violations. On January 8, 2025, Governor Maura Healey signed into law H.5159, An Act enhancing the market review process (the Act). Among other matters, the Act aims to strengthen oversight of private equity investors and related entities in the health care industry, including the expansion of the investigatory and enforcement powers of the Massachusetts Attorney General as they relate to health care activities. The Act also intends to fill perceived gaps in regulatory oversight, that many view as contributors to the Steward Health Care bankruptcy and related hospital closures across Massachusetts, by directly addressing regulation of for-profit health care entities and private equity ownership. The following Act provisions expand the authority of the Massachusetts Health Policy Commission (HPC), Center for Health Information and Analysis (CHIA), and Attorney General’s Office (AGO) to oversee private equity investors and related entities, including through expansions of HPC’s existing oversight authority and extension of the Commonwealth’s state False Claims Statute (MA FCA) to owners and investors of violators. The Act also contains myriad changes impacting the health care industry. It strengthens regulatory oversight over private equity, pharmacy benefit managers, real estate investment trusts (REITs), management service organizations (MSOs), and other industry participants. Expansions of HPC and AGO authority under the Act: Establish new definitions for entities involved in, or related to, private equity operations [1]: “Health care real estate investment trust,” a real estate investment trust, as defined by 26 U.S.C § 856, whose assets consist of real property held in connection with the use or operations of a provider or provider organization. “Private equity company,” any company that collects capital investments from individuals or entities and purchases, as a parent company or through another entity that the company completely or partially owns or controls, a direct or indirect ownership share of a provider, provider organization or management services organization; provided, however, that “private equity company” shall not include venture capital firms exclusively funding startups or other early-stage businesses. “Significant equity investor,” (i) any private equity company with a financial interest in a provider, provider organization, or management services organization; or (ii) an investor, group of investors, or other entity with a direct or indirect possession of equity in the capital, stock, or profits totaling more than ten percent of a provider, provider organization, or management services organization; provided, however, that “significant equity investor” shall not include venture capital firms exclusively funding startups or other early-stage businesses. “Management services organization,” a corporation that provides management or administrative services to a provider or provider organization for compensation. Revise the composition, necessary expertise, and responsibility for appointments to the HPC Board [2]. While the Board will continue to consist of 11 members, the Commissioner of Insurance is now a required member, as are appointed individuals with expertise in representing hospitals and hospital systems and in health care innovation, including pharmaceuticals, biotechnology, or medical devices. However, the HPC will no longer require membership of the Secretary for Administration and Finance, a Primary Care Physician, and an individual with expertise as a health insurance purchaser representing management. Finally, the auditor is no longer responsible for appointments to the HPC Board; all members, other than the Secretary of Health and Human Services and Commissioner of Insurance, will now be appointed solely by the Governor or Attorney General. These changes may reflect a shift in priorities for regulatory oversight of hospital administration, health care innovation, and health care insurance. Expand the HPC Notice of Material Change process [3]. As previously required, every provider or provider organization must provide notice of a “material change” not less than 60 days before the date of the proposed change.  The previous statutory Notice of Material Change reporting requirements only covered: mergers or acquisitions of hospitals or hospital systems; a corporate merger, acquisition or affiliation of a provider or provider organization and a carrier; an acquisition of insolvent provider organizations; and mergers or acquisitions of provider organizations which will result in a provider organization having a near-majority of market share in a given service or region [4]. The Act expands the above-referenced statute mandating the reporting of “material change” requiring notice to the applicable government agencies to also include the following:  significant expansions in a provider or provider organization’s capacity; transactions involving a significant equity investor which result in a change of ownership or control of a provider or provider organization; significant acquisitions, sales, or transfers of assets including, but not limited to, real estate sale lease-back arrangements; and conversion of a provider or provider organization from a non-profit entity to a for-profit entity. The Act also changes the current material change reporting threshold for mergers or acquisitions of a provider organization, which will result in a provider organization having a near-majority market share in a given service or region to a “dominant” market share in a given service or region. Adoption of implementing regulations. While the Act does not include financial thresholds for reporting, the Act does direct the HPC to adopt regulations for administering the section, conduct cost and market impact reviews, and allow filing thresholds to be adopted in the regulations, subject to annual adjustments based on inflation [5].  Expands the HPC Cost and Market Impact Review process as follows: HPC may now require significant equity investors, as well as other parties involved, in a given transaction to submit documents and information in connection with a Notice of Material Change or Cost and Market Impact Review [6]. HPC may require submitting certain information regarding the significant equity investor’s capital structure, general financial condition, ownership and management structure, and audited financial statements. HPC may require submitting certain post-transaction data and information for up to five years following the material change date. Such data collection significantly expands the power and task, including the ability to assess post-transaction impacts.  Expands the factors HPC may consider as part of the Cost and Market Impact Review by also reviewing [7]: the size and market share of any corporate affiliates or significant equity investors of the provider or provider organization; the inventory of health care resources maintained by the DPH; and any related data or reports from the Office of Health Resource Planning. Expands the scope of the HPC’s examination of costs, prices, and cost trends, as follows [7]: The HPC cost trends hearings will include an examination of any relevant impacts of significant equity investors, health care REITs, and MSOs on costs, prices, and cost trends. Stakeholders from these organizations associated with a provider organization will now be required to testify at the HPC’s annual cost trends hearing concerning: “health outcomes, prices charged to insurers and patients, staffing levels, clinical workflow, financial stability and ownership structure of an associated provider or provider organization, dividends paid out to investors, compensation including, but not limited to, base salaries, incentives, bonuses, stock options, deferred compensations, benefits and contingent payments to officers, managers and directors of provider organizations in the commonwealth acquired, owned or managed, in whole or in part, by said significant equity investors, health care real estate investment trusts or management services organizations.” The HPC will utilize new data collected as part of the Registered Provider Organization process. The Act revised this process to require submissions from significant equity investors, health care real estate investment trusts, and management services organizations regarding ownership, governance, and organizational information. Given the broad, sweeping nature of the changes, additional regulations and guidance should be expected. Our team will continue to monitor such activity to help provider organizations transacting in Massachusetts to prepare for the implementation of the statute and forthcoming regulations. [1] To be codified at M.G.L. c. 6D, §. 1. [2] To be codified at M.G.L. c. 6D, §. 2. [3] To be codified at M.G.L. c. 6D, § 13. [4] To be codified at M.G.L. c. 6D, § 13. [5] To be codified at M.G.L. c. 6D, § 13. [6] To be codified at M.G.L. c. 6D, § 13. [7] To be codified at M.G.L. c. 6D, §§ 13, 8.

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Massachusetts Expands FCA Liability To Owners and Private Equity Investors

This post is co-authored by Seth Orkand, co-chair of Robinson+Cole’s Government Enforcement and White-Collar Defense Team. Under a new 2025 law, Massachusetts is one of the first in the nation to broaden its state False Claims Act (FCA) to require disclosures by investors and owners of health care entities. On January 8, 2025, Governor Maura Healey signed into law H.5159, An Act enhancing the market review process (the Act), significantly changing Massachusetts’s regulatory and enforcement landscape. As discussed in further detail here, the law imposes FCA liability against investors and focuses on private equity and corporate ownership in health care. While this Act appears to be the first direct codification of FCA liability, it is consistent with the Department of Justice (DOJ) and Office of the Inspector General, U.S. Department of Health and Human Services’ (HHS-OIG) recent focus on private equity and the impact on health care.[1] While the DOJ has focused on private equity firms that allegedly knew of misconduct at portfolio companies and failed to stop it through their involvement in the operations of those companies, the MA FCA goes further by imposing liability on health care investors for merely being aware of misconduct and failing to report it to the state. H. 5159 expands the scope of the MA FCA enforced by the Commonwealth’s Attorney General[2] to apply to any person who has an “ownership or investment interest” and any person who violates the false claim statute that “knowingly” or “knows” about the violation[3] and fails to disclose the violation to the government within 60 days of identifying the violation. This is a significant expansion of the traditional protections afforded by the corporate veil and appears to be designed to hold private equity and other owners liable if they become aware of any MA FCA violations and fail to take action.  As part of the expansion, the Act defines “ownership or investment interest” as any: (1) direct or indirect possession of equity in the capital, stock, or profits totaling more than ten percent of an entity; (2) interest held by an investor or group of investors who engages in the raising or returning of capital and who invests, develops, or disposes of specified assets; or (3) interest held by a pool of funds by investors, including a pool of funds managed or controlled by private limited partnerships, if those investors or the management of that pool or private limited partnership employ investment strategies of any kind to earn a return on that pool of funds. This amendment clearly expands MA FCA liability to private equity investors and appears to codify the Massachusetts Attorney General’s approach in an October 2021 settlement with a private equity firm and former executives of South Bay Mental Health Center, Inc. for allegedly causing the submission of false claims submitted to MA’s Medicaid program.[4]  Additional enforcement mechanisms codified in the Act include expanding the Attorney General’s authority to obtain information as part of a civil investigative demand from significant equity investors, health care real estate investment trusts, or management services organizations.[5] We will continue to monitor this activity and any resulting litigation and its possible impact on organizations transacting business in Massachusetts. [1] https://www.mass.gov/news/private-equity-firm-and-former-mental-health-center-executives-pay-25-million-over-alleged-false-claims-submitted-for-unlicensed-and-unsupervised-patient-care. [2] To be codified at MGL 12, s. 11N. [3] For example, see Justice Department, Federal Trade Commission and Department of Health and Human Services Issue Request for Public Input as Part of Inquiry into Impacts of Corporate Ownership Trend in Health Care, available at https://www.justice.gov/opa/pr/justice-department-federal-trade-commission-and-department-health-and-human-services-issue; see also, https://www.hhs.gov/about/news/2025/01/15/hhs-releases-report-consolidation-private-equity-health-care-markets.html [4] To be codified at MGL 12, §§ 5A and 5B.  [5] The Act clarifies that “knowing,” “knowingly,” or “knows” all mean “possessing actual knowledge of relevant information, acting with deliberate ignorance of the truth or falsity of the information or acting in reckless disregard of the truth or falsity of the information; provided, however, that no proof of specific intent to defraud shall be required.”

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CMS Finalizes Standard for Identifying Overpayments and Grace Period for Investigations of Related Overpayments

As part of its 2025 Physician Fee Schedule Final Rule (PFS Rule), the Centers for Medicare & Medicaid Services (CMS) finalized two crucial updates to federal Medicare overpayments regulations (sometimes referred to as the “60-Day Rule”) that (1) align the standard for when an overpayment is identified with the applicable standard under the False Claims Act (FCA), and (2) give health care providers up to 180 days to conduct good faith investigations to determine the existence of related overpayments after identifying an overpayment, respectively.  These two changes address areas of significant uncertainty for health care organizations in recent years. Previously, there was uncertainty concerning the standard for “reasonable diligence” for identifying overpayments and how that standard squared with the FCA’s knowledge (scienter) requirement for liability thereunder. In addition, the changes also indicate the expectation by the government that, upon identifying an overpayment, health care organizations conduct timely good faith investigations to determine the existence of related overpayments to fulfill their 60-Day Rule obligations. Medicare Overpayments Rule & Reasonable Diligence Standard As a reminder, the 60-Day Rule was established as part of the Affordable Care Act (ACA) and requires a health care provider that receives an overpayment to report and return the overpayment by the later of (i) 60 days after the provider identifies the overpayment or (ii) the date any corresponding cost report is due. Failure to report and return an overpayment in a timely manner subjects the provider to significant potential liability under the FCA for a so-called “reverse false claim” for wrongful retention of the overpayment. However, the ACA did not define when an overpayment has been “identified.” This issue was addressed in rulemaking by CMS in 2014 (for Medicare Parts C and D) and 2016 (for Medicare Parts A and B), wherein CMS indicated that a provider “identifies” an overpayment when it determines, or should have determined, that the provider received an overpayment (this exercise is referred to as the “reasonable diligence” standard). In 2018, a federal court overturned the reasonable diligence standard for Medicare Parts C and D in response to litigation brought by Medicare Advantage organizations. The court held that the reasonable diligence standard impermissibly established FCA liability for “mere negligence” and noted that the FCA had a specifically-defined knowledge standard that does not encompass negligence. Updated Knowledge Standard for Identifying Overpayments In response to the federal court’s ruling, and to promote consistency across Medicare programs, in December 2022, CMS proposed updating its 60-Day Rule regulations to align the knowledge standard for identifying an overpayment with the standard under the FCA (please see here for our previous discussion of that proposed rule). In the PFS Final Rule, CMS has finalized its proposal without changes. As of January 1, 2025, under the 60-Day Rule, a person has identified an overpayment when the person: Has actual knowledge of an overpayment; Acts in deliberate ignorance of the truth or falsity of information regarding the overpayment; or Acts in reckless disregard of the truth or falsity of information regarding the overpayment. Updated Reporting Deadline to Permit Good Faith Investigation of Related Overpayments In the PFS Final Rule, CMS also provides additional guidance and finalizes regulations concerning providers’ potential obligation to determine the existence of related overpayments upon identifying an overpayment. CMS acknowledges the challenge in determining when the 60-day “clock” starts for reporting and returning an overpayment.  CMS states that the 60-day period begins when a provider “has actual knowledge of the overpayment” or if the provider “acts in deliberate ignorance or reckless disregard of the existence of the overpayment,” that period starts when the provider “acted in deliberate ignorance or reckless disregard of the truth or falsity of information regarding the overpayment.” A lingering question for many health care organizations has been whether, upon discovering a single overpayment, the organization has an obligation under the 60-Day Rule to investigate whether an underlying compliance issue could have resulted in other overpayments. CMS responds affirmatively in the PFS Final Rule, stating “we agree... that where a single overpayment is found and other related overpayments are suspected, the provider or supplier should investigate and calculate the aggregate overpayment prior to its return.” Consequently, CMS is finalizing a related regulation under the 60-Day Rule, which “suspends the 60-day report and return obligation for up to 180 days, to allow persons time to complete a good-faith investigation to determine the existence of related overpayments that may arise from the same or similar cause or reason as the initially identified overpayment.” In other words, the 60-day clock can be delayed for up to 180 days to allow providers time to conduct a good faith investigation of potential related overpayments to ensure a comprehensive reporting and returning of overpayments. Conclusion The 60-Day Rule updates in the PFS Final Rule provide important guidance and assurances to health care organizations regarding the standard for identifying overpayments and the government’s expectations for providers to proactively investigate, identify, and return such overpayments. Health care organizations should carefully review the final 60-Day Rule regulations and preamble commentary guidance from CMS and update their compliance processes accordingly in order to mitigate the potential risk of FCA liability and whistleblower lawsuits for reverse false claims.  If you have any questions regarding the PFS Rule and 60-Day Rule overpayment regulations, please do not hesitate to reach out to the authors or your contact at Robinson & Cole LLP for specific guidance.

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California Governor Vetoes Bill Imposing New Requirements for Private Equity in Healthcare Transactions

On September 28, 2024, California Governor Gavin Newsom vetoed California Assembly Bill 3129 (the Bill). The Bill, if enacted, would have imposed new notice and consent requirements for private equity investors involved in healthcare transactions. Governor Newsom’s veto statement clarifies the Bill’s vetoing, stating that the Office of Health Care Affordability (OHCA) “was created as the responsible state entity to review proposed health care transactions, and it would be more appropriate for the OHCA to oversee these consolidation issues as it is already doing much of this work.” A summary of the Bill’s requirements is included below. The Bill, if enacted, would have required a private equity group, or a hedge fund, to provide written notice of, and obtain the written consent of, the California Attorney General (CA AG) before certain health care transactions could become effective. This approval would have been required for any transaction in which a private equity group or hedge fund is either indirectly or directly acquiring “more than 15 percent of the market value or ownership shares of the health care facility, provider group, or provider;” or, obtaining “rights significant enough to constitute a change in control, including, but not limited to, supermajority rights, veto rights, exclusivity provisions, and similar provisions.” The Bill provided a narrow exception from the consent requirement where all of the following apply: (1) the private equity group or hedge fund has not been involved in any healthcare acquisitions in the preceding seven years; (2) the group consists of fewer than 10 providers; and (3) the group’s gross annual revenue is less than $25 million, although notice may still be required. The Bill would have required that the private equity group or hedge fund submit notice to the CA AG at the same time that any other state or federal agency is notified pursuant to state or federal law and otherwise at least 90 days before the transaction. The Bill would also have authorized the CA AG to extend that 90-day period under certain circumstances. The Bill does not specify the documents that would have to be submitted with the notice filing, but it does require the submission of information sufficient for the CA AG to determine whether approval is appropriate. The documents to be submitted would likely have included (at a minimum) deal documents and related information that communicate the nature of the transaction and its likely impact on competition, costs, and access to healthcare services. At the end of the 90-day period, the Bill would have authorized the CA AG to consent to, give conditional consent to, or not consent to a transaction between a private equity group or hedge fund and a health care facility, provider group, or provider if the transaction “may have a substantial likelihood of anticompetitive effects, including a substantial risk of lessening competition or of tending to create a monopoly, or may create a significant effect on the access or availability of health care services to the affected community.” Additionally, the Bill would have prohibited a private equity group or hedge fund involved in any manner with a physician, psychiatric, or dental practice doing business in California from interfering with the professional judgment of physicians, psychiatrists, or dentists in making health care decisions, among other things. Lastly, the Bill would also have authorized the CA AG to adopt regulations and contract with state agencies, experts, or consultants to implement its requirements, as specified. The Bill follows a broader national trend of heightened notice and consent requirements for health care transactions involving private equity investors. We will continue to monitor the evolution of this trend and provide related updates.

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A Federal Court in Texas Strikes Down the FTC’s Nationwide Non-Compete Ban

On August 20, 2024, the United States District Court for the Northern District of Texas (Dallas Division) struck down the Federal Trade Commission’s (FTC) non-compete rule, 16 CFR § 910.1-6, that was set to take effect on September 4, 2024. A summary of this ruling, which has significant implications for employers nationwide, is included below. This post is a follow-up to our previous post summarizing the prior conflicting opinions regarding whether the FTC had the authority to ban non-compete clauses. This case originated when the plaintiff, Ryan LLC, challenged the lawfulness of the FTC’s non-compete rule. Ryan LLC was joined by plaintiff-intervenors, the United States Chamber of Commerce, Business Roundtable, Texas Association of Business, and Longview Chamber of Commerce, who also challenged the FTC’s authority to enact the FTC non-compete rule. The FTC’s non-compete rule would have preempted state law and invalidated employment contracts containing non-compete clauses nationwide. The court reasoned, first, that the FTC’s non-compete rule exceeded the FTC’s authority because it does not have the authority to promulgate substantive rules regarding unfair methods of competition. The court further found the FTC’s non-compete rule to be arbitrary, capricious, and in violation of the Administrative Procedure Act as the FTC failed to justify the expansive breadth of its ban. Therefore, the court ultimately granted the plaintiff’s motion for summary judgment and denied the FTC’s cross-motion for summary judgment, setting aside the non-compete rule. In conclusion, the court stated, “the Rule shall not be enforced or otherwise take effect on its effective date of September 4, 2024, or thereafter.” The court’s summary judgment order applies nationwide and means that the non-compete agreements that were enforceable before the rule remain enforceable, and new non-compete agreements may be entered into depending on state law. It is possible that the FTC may appeal the ruling to the Fifth Circuit; however, the FTC has not yet indicated whether it will do so. We will continue to monitor the status of the FTC’s non-compete rule and provide any subsequent updates.

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Opposing Decisions – Does the FTC Have the Authority to Ban Non-Compete Clauses?

*This post was co-authored by Lily Denslow, legal intern at Robinson+Cole. Lily is not admitted to practice law. In April, the Federal Trade Commission (FTC) promulgated a new rule banning non-competes (the Rule); the FTC adopted the Rule to prohibit employers from entering into or enforcing non-compete clauses with workers and senior executives. Several lawsuits were quickly filed challenging the rules. Separate parties filed in Texas (in which cases were consolidated), and ATS Tree Services, LLC, filed an action in Pennsylvania. On July 23, 2024, the U.S. District Court for the Eastern District of Pennsylvania issued a ruling denying ATS Tree Services’ motion for a stay and a preliminary injunction against the Rule. ATS Tree Services, LLC v FTC, No: 2:24-cv-01743-KBH, at p.18 (E.D. Pa. July 23, 2024). The Court held that ATS had not demonstrated the irreparable harm necessary to justify the issuance of a preliminary injunction and also held that ATS failed to establish a reasonable likelihood of success on the merits of its action. The ruling is diametrically opposed to the July 3, 2024, ruling from the U.S. District Court for the Northern District of Texas, which preliminarily enjoined the Rule and postponed its effective date in Ryan, LLC v. U.S., No. 3:24-CV-00986-E, 2024 (N.D. Tex. July 3, 2024). However, the district court declined to issue a universal injunction, making its ruling applicable only to the Ryan plaintiffs. The Decisions In ATS Tree Services, the court first held that nonrecoverable costs of compliance do not rise to the level of irreparable harm, in that “monetary loss and business expenses alone are insufficient bases for injunctive relief.” ATS Tree Services at p.18. Additionally, the court held that the claimed loss of contractual benefits was too speculative. Id. 20-21. Even though the court found that ATS failed to establish irreparable harm, it added an analysis of ATS’s likelihood of success on the merits, spending the majority of its decision assessing (just as the Ryan Court had) whether “[s]ection 6(g) empowers the FTC with the authority to make substantive rules related to unfair methods of competition in or affecting commerce, or whether the rulemaking authority therein is limited to procedural rules relating to adjudications of unfair methods of competition in or affecting commerce.” ATS Tree Services, at p.8. Notably, the Court relied upon the Supreme Court’s recent decision in Loper Bright Enterprises v. Raimondo, 144 S. Ct. 2244, 2263 (2024) to “independently interpret the statute and effectuate the will of Congress subject to constitutional limits.” Id. at 25. In doing so, the Court harmonized sections 5 and 6 of the FTC Act, concluding: When taken in the context of the goal of the Act and the FTC’s purpose, the Court finds it clear that the FTC is empowered to make both procedural and substantive rules as is necessary to prevent unfair methods of competition. Thus, the Court rejects ATS’s argument that it should read the word “procedural” but not the word “substantive” into the statutory text defining the FTC’s rulemaking authority. This argument is inherently inconsistent and therefore untenable. Id. at 26. This was directly contrary to the Ryan decision where the court found under section 6(g) that the FTC lacks the authority to create substantive rules because the Act is only a “housekeeping statute” that allows the FTC to promulgate general “rules of agency organization procedure or practice,” not “substantive rules.” Ryan at *15 (citing Chrysler Corp. v. Brown, 441 U.S. 281, 310 (1979)). The court in ATS Tree Services went on to address the FTC’s mandate to “prevent prohibited ‘unfair methods of competition’” under section 5, thereby acknowledging Congress’s terms were “intended to act prophylactically to stop ‘incipient’ threats of unfair methods of competition, not solely responsively through adjudications, as courts interpreting the statute have confirmed.” ATS Tree Services, at p. 28. In addition, the court found that the FTC’s rulemaking authority had been confirmed by other circuit courts. Finally, in the rest of the decision, the Court disposed of the other alternative challenges made by ATS. This was contrary to the Ryan decision, where the Texas court had held that the FTC acted arbitrarily and capriciously, because the Rule was “unreasonably broad without a reasonable explanation” and did not sufficiently address alternatives to issuing the Rule.   Key Takeaways The two courts have issued opinions with conflicting analyses. While Texas has issued a preliminary injunction specific to the Ryan plaintiffs, the court did indicate it intends to make a final determination on the merits by August 30, 2024, prior to the Rule’s effective date. The Ryan Court will have the opportunity to vacate the Rule in its entirety as unlawful and issue a permanent injunction, with the scope of the relief ordered yet to be decided. This new ruling sets up the potential for an appeal to the U.S. Court of Appeals for the Fifth Circuit and possibly seek direct relief from the U.S. Supreme Court. As we inch closer to the final date, businesses and health care entities should remain aware of litigation developments regarding the Rule and the potential for extended litigation. We will continue to monitor and update on any developments.

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Key Second Circuit Decision Defines AKS Willfulness Standard

On March 12, 2024, the U.S. Court of Appeals for the Second Circuit issued an important decision interpreting the “willfulness” standard necessary to find a violation of the federal Anti-Kickback Statute (AKS). The decision provides important guidance for health care and pharmaceutical organizations on what constitutes a knowing violation of the AKS and for counsel to such organizations on defending clients in AKS and False Claims Act (FCA) cases. Overview of AKS Allegations and FCA Claims In U.S. ex rel Hart v. McKesson, a former employee of the defendant (a pharmaceutical distributor) filed a qui tam lawsuit under the federal FCA – and certain state FCA analogues – premised on alleged violations of the AKS by the defendant. According to the Second Circuit’s opinion, the relator alleged that the defendant: Offered business management tools to providers that allowed the providers to select certain specialty drugs based on maximizing the potential revenue to the provider (which in turn increased costs for insurers, including the Medicare and Medicaid programs); and Offered free access to these valuable business management tools to customers who selected the defendant as “their primary wholesale supplier of branded and generic drugs,” but refused to provide free access to providers who only purchased individual drugs without such a commitment. The relator accordingly alleged that (i) the provision of free access contingent upon the commitment constituted an illegal inducement under the AKS, and therefore, (ii) claims submitted by providers who received free access to the tools were tainted by the alleged kickback and constituted false claims under the FCA. District Court Dismissal A district court granted a motion to dismiss on the basis that the relator failed to plausibly show that the defendant acted willfully, and therefore failed to show that the defendant acted with the requisite scienter for an FCA violation. That court dismissed the federal FCA claim, as well as the state law analogues. Second Circuit Analysis of Willfulness under AKS On appeal, the Second Circuit assessed the “primary issue” of what constitutes acting “willfully” under the AKS. The court first noted that it had addressed a similar question in its 2022 Pfizer decision (which we previously analyzed here), where the court observed that a defendant can “willfully” violate the AKS if the defendant “knows that his conduct is illegal” even if unaware of the “exact statutory provision that his conduct violates.” The court analyzed the history of the AKS legislation and nationwide jurisprudence interpreting the willfulness – or mens rea – standard and determined that the term should be interpreted as consistent with federal criminal law. The court, therefore, held that in order to be subject to criminal prosecution under the AKS for acting willfully, a defendant “must act with knowledge that his conduct was unlawful” under the AKS or another law. However, the court also cautioned that this does not require that a defendant “know of the AKS specifically or intended to violate that statute” in order to be subject to liability thereunder. Instead, a person may have criminal liability under the AKS without being aware of that statute if there is evidence that the person “acts with knowledge that [their] conduct is, in some way, unlawful.” In reaching this conclusion, the court indicates that it intends to protect “those (and only those) who innocently and inadvertently engage in prohibited conduct.” In a footnote, the court also explained that its holding was, in its view, “consistent with the scienter requirement for health care fraud” under federal criminal law at 18 U.S.C. § 1347. In response to the specific FCA case in front of the court, the court determined that neither of the relator’s two proposed willfulness interpretations were consistent with the court’s conclusion, described above. The court then analyzed the relator’s claims and determined that “none” of the allegations “alone or together gives rise to a plausible inference” that the defendant acted willfully. It accordingly upheld the district court’s dismissal of the relator’s federal FCA claim, although it reversed the district court’s dismissal of the relator’s remaining claims brought under state (and the District of Columbia) FCAs. Takeaways Health care organizations and defense counsel will want to study this opinion closely when considering exposure to potential FCA and AKS claims. Notably, the court’s analysis of alternative potential interpretations and recent decisions in other circuits may provide additional guidance for distinguishing claims and/or defenses.

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Additional States Implement Notice Requirements for Healthcare Transactions

In a prior blog post, we noted the trend of states enacting legislation implementing reporting requirements for certain healthcare transactions. On March 13, 2024, Indiana joined this trend as Indiana Governor Eric Holcomb enacted Senate Enrolled Act No. 9 (the Act). The Act mandates that, effective July 1, 2024, Indiana health care entities involved in a merger or acquisition with another health care entity with total assets of at least ten million dollars ($10,000,000) must notify the Office of the Indiana Attorney General of the transaction at least ninety (90) days prior to closing. Indiana joins several other states with previously passed notice laws, including California, Colorado, Connecticut, Hawaii, Illinois, Massachusetts, Minnesota, Nevada, New York, Oregon, Rhode Island, and Washington. However, the Act’s scope is broader than similar legislation recently enacted in other states. For example, the ten-million-dollar ($10,000,000) threshold is lower than the threshold included in legislation from other states, and the definition of “health care entity” applies to a wide array of entities. The definition of “health care entity” within the Act includes “any organization or business that provides diagnostic, medical, surgical, dental treatment, or rehabilitative care” and also includes various types of insurers. The term “health care entity” additionally encompasses private equity partnerships seeking to enter into a merger or acquisition with an Indiana health care entity regardless of where the private equity partnership is located. The notice required by the Act must include the following information from each health care entity: business address and federal tax number, name and contact information of a representative of the health care entity concerning the merger or acquisition, description of the health care entity, description of the merger or acquisition, including the anticipated timeline, and a copy of any materials that have been submitted to a federal or state agency concerning the merger or acquisition. The notice submitted must be certified before a notary public. Not later than forty-five (45) days from the submission of notice, the Office of the Indiana Attorney General is required to review the information submitted with the notice and may analyze any antitrust concerns in writing. The Office of the Indiana Attorney General is granted the authority to issue a civil investigative demand for additional information as needed and is required to keep confidential all nonpublic information that is submitted. The Act also contains strict penalties for noncompliance. If a health care entity fails to comply with a written demand, the Act grants the Office of the Indiana Attorney General authority to file an order to enforce the demand. If an entity fails to comply with a final order or an order imposing sanctions, the court may hold the person in contempt. Additionally, if a court finds that a party has acted in bad faith in resisting the demand, it may order that person to pay the other parties’ reasonable expenses including attorney’s fees. In the face of this growing trend of increased transaction oversight of healthcare transactions, it is essential for healthcare entities to continue to closely monitor these developments in various states and ensure subsequent compliance. We will continue to monitor developments across the country regarding additional states adopting such laws as well as changes to those laws already adopted.

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New York Implements Health Equity Impact Assessment as New Requirement for Certificate of Need Process

On June 22, 2023, New York State Public Health Law § 2802-b, added a Health Equity Impact Assessment (HEIA) to the Certificate of Need (CON) process for certain health care facilities. The new requirement comes as part of larger legislative changes to the Public Health Laws passed in 2021. The new HEIA requirement applies to any CON applications submitted on or after June 22, 2023, except there is a partial carve out for Diagnostic and Treatment Centers whose patient population is 50 percent or more Medicaid eligible or uninsured. The Department of Health also issued regulations on June 29, 2023 (10 NYCRR 400.26). The purpose of the HEIA is to understand the health equity impact on a specific project, the impact it may have on medically underserved groups and to ensure community input and assessment are considered. The Department of Health has expressed that their vision is “to have health equity considerations meaningfully impact the planning and execution of health care facility projects.” (NYSDOH, Health Equity Impact Assessment, Webinar Series: Program Documents, September 14, 2023.) Independent Entity Under the new law, the HEIA must be prepared by an independent entity. This individual or organization must have expertise and experience in health equity, anti-racism, and community and stakeholder engagement. The independent entity is also required to have expertise and experience in either health care access or delivery of health care services. While the Department of Health has refrained from listing pre-approved independent entities, they have set forth certain prohibitions on who can act as an independent entity for a given project. The independent entity must not be involved in compiling any portion of the project’s CON other than the HEIA. The independent entity also must not have any financial interest in the outcome of the CON application, nor are they permitted to receive any financial gift or incentive for performing the HEIA beyond fair market value compensation for their services. The Department of Health notes that the market value or cost of performing an HEIA is not currently regulated. The Department of Health has published a conflict-of-interest form to help CON applicants assess whether their prospective independent entity has a financial interest in the outcome of the CON, which would bar them from being able to perform the HEIA. The form must be submitted alongside the completed HEIA. Meaningful Engagement The new HEIA requirement stipulates that the HEIA process must “include the meaningful engagement of public health experts, organizations representing employees of the applicant, stakeholders, and community leaders and residents of the applicant’s service area.” While involving local health departments is not a requirement, the Department of Health strongly suggests collaboration with health departments by the independent entity. The Department of Health has noted that the intent of the “meaningful engagement” requirement is to get direct feedback on the proposed project from a variety of affected parties, and that the methods used to obtain that feedback should be tailored to each type of stakeholder. This includes feedback that is reasonable and culturally competent. As part of the required HEIA documentation, applicants must complete a data table (supplied by the Department of Health), in which they record each stakeholder that was contacted, method of engagement, and whether that stakeholder is supportive of the applicant’s project. The new Office of Health Equity and Human Rights of the New York State Department of Health broadly defines health equity and health disparities, including focusing on the social determinants of health, i.e., economic stability, neighborhood and built environment, language access, social and community context, education and health and healthcare. Assessment Requirements The Department of Health has published a template for independent entities to follow when completing and submitting the HEIA. The template breaks the assessment down into the following broad categories: Scoping. This section requires documentation of several demographic measurements of the facility’s service area. This section also assesses whether and how the proposed project will affect medically underserved groups, and if there are comparable services in the area that those groups may be able to access. The independent entity must describe here if the proposed project will affect care the applicant provides in relation to the Indigent Care Pool and any other statutory obligations the applicant may have. The independent entity must also include any civil rights access complaints filed against the applicant within the last 10 years. Potential Impacts. This section requires the independent entity to assess what impacts this project may have on health care access, health equity, and health disparities. The independent entity must also examine any unintended consequences of the proposed project, any effect that it may have on the applicant’s provision of indigent care, and any physical access barriers that the project may create (including access via transportation and access by individuals with mobility impairments). This section also includes the meaningful engagement assessment, as described above. Mitigation. In this section, the independent entity must suggest ways in which the potential negative impacts of the proposed project can be best mitigated by the applicant. The independent entity is required to suggest changes to the project, methods of communication with the community, and ways that the project could address systemic barriers to health care access. Monitoring. Here, the independent entity will suggest ways in which its recommendations might be adopted by the applicant on an ongoing basis to assess the impact of the proposed project over time. While the independent entity is not required to provide this monitoring (i.e. the HEIA requirements do not stipulate that the independent entity must remain contracted with the applicant), the independent entity can provide suggestions for best practices in this section. Within one week of acknowledgement of the HEIA by the Department of Health, the applicant must disseminate the results (included as part of the CON) publicly on its website. This posting must also include a statement from the applicant as to how they intend to implement the mitigation measures suggested by the independent entity. Entities should start early in identifying an independent entity to conduct the HEIA. It will be important to understand community feedback when submitting a CON. While community opposition may not completely derail a proposed CON, understanding objections and addressing considerations for the impact on medically underserved groups will be an important consideration.   

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CMS Announces 0.8 Percent Aggregate Home Health Payment Increase in 2024

On Wednesday, November 1, the Center for Medicare & Medicaid Services (CMS) released its Home Health Prospective Payment System Rate Update final rule for CY 2024 (the Final Rule). The Rule estimates that the aggregate increase to Medicare home health payments for 2024 will be 0.8 percent, or $140 million. This 0.8 percent increase results from the combined effects of three forecasted rate changes: (1) a 3.0 percent increase to home health payments, (2) a 2.6 percent decrease based on the permanent behavior assumption adjustment, and (3) a 0.4 percent increase resulting from an update to the fixed-dollar loss ratio, which is used to determine outlier payments. The 0.8 percent increase is a departure from the Proposed Rule, which estimated a cut in payments of up to 3 percent. The Final Rule also includes a permanent payment adjustment of -2.89 percent, just half of the -5.1 percent projected in the Proposed Rule. While CMS did reduce this adjustment in response to concerns that the adjustment would overburden home health agencies, the reduction still represents a significant decrease in payments on top of the -3.925 percent adjustment made in 2023. Other changes contained in the final rule include: Rebasing and revising the market basket used to update home health payments Updating and implementing the revised labor-related share Codifying requirements for home health patients needing negative pressure wound therapy using a disposable device Recalibrating case-mix weight and LUPA threshold using updated utilization data We will continue to monitor changes to home health payments as these updated estimates take effect.

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