Behavioral/Mental Care

Nelson Hardiman has unrivaled depth of knowledge and experience on the licensing, operational, and reimbursement issues facing behavioral and mental healthcare providers, including residential, outpatient, hospitals, and professionals. Our experience includes the widest range of mental health, substance abuse/addiction treatment, applied behavioral health services, and other services.

In contrast to other areas of healthcare law and regulation, behavioral healthcare has undergone significantly more change and reflect more variation from jurisdiction to jurisdiction. The Mental Health Parity Act of 2008 and Affordable Care Act, for example, have transformed the landscape of reimbursement, opening up new opportunities to provide needed services. At the same time, this unprecedented growth has led to rising levels  of concern over patient safety and fraud and abuse issues. With respect to patient safety, state laws have evolved in different ways as to the interplay between clinical care from physicians and mental health professionals and social model programs. With respect to reimbursement, rising levels of funding have given rises to a host of new questions and compliance concerns. Nelson Hardiman has deep experience with both setting up compliant business relationships, operations, marketing, and billing/coding. We have also addressed and remediated problems that have arisen in many cases, including investigations by federal and state government agencies, zoning disputes with local government, and audits by health plan special investigations units.

We have represented providers ranging from large national and international nonprofit providers and managed behavioral health organizations (MBHOs) to start-ups and small providers. We have significant experience with the regulatory requirements in over 25 states, often advising entrepreneurs and investors in the process of initial licensing and accreditation. We have been called upon to handle the most sensitive of challenges, including designing and instituting compliance programs to reduce and prevent risk in cases where confusion and sub-optimal practices have led to patient suicides, deaths, and other harm. Based on our depth of knowledge and experience, we are frequently called upon at the launch of new ventures and new service lines to ensure not only compliance with all laws and regulations, but also with evolving best practices.

Our work includes business, regulatory, and strategic counseling and representation, including:

  • Investment Advisory and Business Transactions
    • Advising on scope of service offerings, including medical and non-medical, social model programs, and the widest range of treatment modalities, including medical, mental health, and integrative care;
    • Recommending for-profit and non-profit structures, including structures involving management service organizations (MSOs) and professional service corporations;
    • Purchase and sale of behavioral healthcare businesses
    • Negotiating and handling transactions involving behavioral care businesses.
  • Licensing, Certification, and Accreditation
    • Recommending optimal licensing and accreditation strategies for scope of services and reimbursement purposes;
    • Overseeing applications for licensure to state agencies, including the California Department of Health Care Services (DHCS) Substance Use Disorders Division (which licenses and certifies residential facilities for drug and alcohol treatment and certifies outpatient intensive outpatient (IOP) and partial hospitalization (PHP) programs;
    • Overseeing applications for licensure of residential facilities for individuals with primary mental health issues, including social rehabilitation and adult residential facilities licensed by the California Department of Social Services;
    • Overseeing applications for licensure of residential mental health facilities, including Congregate Living Health Facilities (CLHFs), which are licensed by the California Department of Public Health (CDPH);
    • Assisting with accreditation by the Joint Commission (JCAHO), CARF, and other accrediting agencies.
  • Compliance
    • Developing compliance programs (including policies and procedures, training, governance, auditing and other compliance program elements) consistent with industry best practices and state licensing and operational requirements for behavioral care entities
    • Knox-Keene compliance for MBHOs
    • Compliance with HIPAA, Title 42 substance abuse privacy requirements, and state patient data privacy and security requirements
  • Regulatory Defense
    • Defense of investigations (administrative, civil, and criminal) before state agencies regulating facilities, outpatient programs, and professionals;
    • Defending reimbursement audits and investigations by public and private payors
  • Litigation
    • Defense of False Claims Act/qui tam whistle-blower litigation against behavioral healthcare providers
    • Payor and reimbursement disputes