Attorneys Aviva Morady and Regina Trainor Elevated to Partnership

Top-ranked healthcare law firm Nelson Hardiman announced today the promotion of attorneys Aviva Morady and Regina Trainor to partnership. “The elevation of both Aviva and Regina reflects their proven leadership on behalf of law firm clients across a wide spectrum of the healthcare and life sciences industries,” commented Managing Partner Harry Nelson. “We as a firm and our clients depend on Regina’s and Aviva’s expertise in circumnavigating constantly changing regulatory demands and business challenges. We are deeply grateful for their leadership.”

Having joined Nelson Hardiman from the McDermott Will & Emery law firm, Aviva Morady addresses complex regulatory and transactional representation to a wide range of healthcare providers and organizations including physician organizations, behavioral health providers, laboratories, and telehealth ventures. Ms. Morady has earned a reputation for expertise in licensing, operational, and reimbursement issues, including Medicare, commercial insurance, and fraud and abuse challenges. “Aviva has unparalleled experience navigating the complex details of healthcare organizations,” said partner Mark Hardiman. “She is a trusted advisor who clients can count on for calm, critical advice in the most difficult problems they face.”

Regina Trainor joined the firm from NYU Langone Health, where she served as Vice President for Ambulatory Network Strategy and Associate General Counsel of one of the nation’s premier academic medical centers devoted to patient care, education, and research. Since joining Nelson Hardiman, Regina has worked extensively on cutting-edge healthcare ventures involving complex corporate practice of medicine issues, including telemedicine and direct-to-consumer practice models, including aesthetic and regenerative medicine, and laboratory testing ventures. Regina has significant experience in issues concerning physician practice acquisitions, and a wide range of cutting-edge healthcare and life sciences ventures. “Regina brings a treasure trove of experience and wisdom to our firm, combined with an amazing drive and commitment to practical problem-solving,” commented Harry Nelson.

About Nelson Hardiman
Nelson Hardiman LLP is the premier healthcare and life sciences firm in Los Angeles, serving healthcare and life science providers, investors, and organizations that need experts on the most difficult questions with deep industry knowledge and relationships. The firm’s litigation practice specializes in defending fraud and abuse and whistleblower actions, government investigations, and other complex business disputes. Nelson Hardiman’s transactional group handles healthcare organization acquisitions, sales, investment, and financings, and Nelson Hardiman’s regulatory team advises on compliance with licensing, operational, and reimbursement issues across the full continuum of healthcare industry sectors, with expertise on Medicare and Medicaid requirements, privacy and data security, FDA, and other regulatory matters. The firm has earned a singular position reputation nationally for its leadership in addressing issues in behavioral health, telehealth, corporate practice of medicine, and emerging therapeutic modalities. More information about the firm is available at https://www.nelsonhardiman.com or at 310.203.2800.

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Despite Jury Win, Opioid Attys Predict ‘A Long Way To Go’

From the article:

Law360 (November 23, 2021, 10:35 PM EST) — A jury’s landmark finding that major pharmacy chains fueled the opioid crisis in Ohio was a badly needed win for governments in nationwide opioid litigation, but experts cautioned that a gauntlet of appeals awaits — something that plaintiffs attorneys themselves immediately acknowledged.
The verdict found that CVS, Walgreens and Walmart “engaged in intentional and/or illegal conduct [that] was a substantial factor in producing” the opioid crisis in the northeastern Ohio counties of Lake and Trumbull.At a news conference following the verdict, attorneys for Lake and Trumbull counties vowed to keep pursuing trials over the “massive public health crisis” of opioid abuse. They likened the situation to protracted litigation in recent decades over asbestos-related diseases and predicted that they’ll suffer setbacks.

“We’re going to try a lot of cases. We’re going to lose some, but we’re going to win this war,” Motley Rice LLC co-founder Joe Rice, a lead plaintiffs attorney in multidistrict opioid litigation, told reporters.

The verdict on Tuesday followed two judgments this month — in the only other opioid cases to have produced trials and judgments — that poked holes in the key legal theory underpinning opioid litigation: that companies created a “public nuisance” of narcotic abuse by selling opioids with scant regard for their serious safety risks.

In one of the rulings, the Oklahoma Supreme Court struck down a $465 million bench verdict against Johnson & Johnson in a case brought by the state’s attorney general. In the other, a California state judge delivered a total triumph to J&J and three other drugmakers in a case brought by four Golden State communities.

Tuesday’s verdict ended that brief losing streak, and it also gave plaintiffs attorneys an undefeated record — 1-0 — in opioid trials against pharmacies. Every other opioid trial so far has focused on manufacturers or distributors, and it had been unclear how juries might react to cases contending that some of the nation’s largest retailers have quietly been sowing the seeds of widespread opioid addiction.

“There’s some causal arguments that the pharmacies might be a little bit different than the other parts of the chain of distribution from the manufacturers to the distributors,” the University of Georgia School of Law’s Elizabeth Chamblee Burch said Tuesday. “Pharmacies are the ones that are really on the frontline. They’re the ones that are seeing the people that come in and seeing what their prescriptions are.”

Harry Nelson, managing partner of health law boutique Nelson Hardiman LLP, cautioned Tuesday that forcing pharmacies to scrutinize prescriptions more aggressively could have undesirable consequences.

“There are cases where pharmacies should be doing more to look for warning signs and red flags,” Nelson said. “But I don’t think we want to have a system where you get a prescription from a doctor, and then you go to the pharmacy, and you have to prove that the prescription medication is the one that the doctors recommended that you get.”

Nelson added, however, that the jury verdict suggests the public is angry about the opioid crisis — which has hit the Buckeye State harder than almost any other state — and eager to hold accountable any company that profited off of prescription painkillers.

Large pharmacies have notably been reluctant to strike settlement deals, in contrast to major drugmakers and distributors that have reached various settlements over the long course of the opioid litigation, including proposed global settlements worth $26 billion with Johnson & Johnson and distributors AmerisourceBergen Corp., Cardinal Health Inc. and McKesson Corp.

Rice on Tuesday said the jury verdict “is going to be talked about in the boardroom of every corporation that’s in the pharmaceutical chain that’s involved in this litigation.” He argued that it would be best to negotiate nationwide settlements “before we end up with a lot of jury verdicts,” while also predicting that “we’ve got a long way to go.”

All three of the pharmacy corporations swiftly vowed to appeal the liability verdict, which will be followed next year by bench proceedings to determine the financial remedy. The counties plan to seek more than $1 billion apiece, and their lawyers are cautioning that appeals courts will likely weigh in before any money that’s awarded actually reaches the communities.

“I’d love to say that the money will be disbursed, and the problem will be abated, and we will see thriving communities overnight. But regrettably, that won’t be the case,” Mark Lanier, lead trial counsel for Lake and Trumbull, said Tuesday. “We expect that the companies will appeal these decisions — that they will appeal them all the way to the U.S. Supreme Court. And that’s a process that can take years.”

And there’s a good chance that the companies will prevail on appeal, experts said.

Burch noted that the Sixth Circuit has already reversed U.S. District Judge Dan Aaron Polster — who presided over the trial and supervises the MDL — on key issues in the opioid litigation. Those issues include his certification of a novel “negotiation class” that pharmacies opposed, and his decision to let local governments belatedly supplement their allegations against pharmacies.

Nelson also pointed to Judge Polster’s decision to let the trial go forward after a juror did her own research in defiance of the court’s instructions and shared her findings with other members of the jury.

Both the counties and the pharmacies “initially agreed that it was such severe misconduct, that there should have been a mistrial,” Nelson said. “And then, bizarrely, the judge kind of pushed [the counties] to withdraw their request for mistrial.”

In the California case, the lack of specific evidence tying specific opioid prescriptions to the epidemic foiled the local governments’ case, as that judge concluded that a rise in opioid prescriptions couldn’t be directly tied to the opioid epidemic.

Nelson suggested Tuesday that a similar lack of specifics may prove key in the pharmacies’ appeal, noting that there were no specific examples of residents in Lake and Trumbull who shouldn’t have had their opioid prescriptions filled.

“The whole crisis is much more complicated than just looking at the quantities and saying [the pharmacies] should have been more suspicious,” Nelson said.

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Partner John Mills on ACap ReCap discussing how doctors can increase insurance reimbursements.

In this episode our subject matter expert is healthcare attorney John Mills from Nelson Hardiman. The topic of discussion is Insurance Reimbursements.

In particular, we talk about:

1. Medicare reimbursement

2. Reasons of overpayment disputes with healthcare insurance companies

3. What are fraud, waste & abuse

4. Why a provider gets audited: reasons and consequences

5. How the provider can minimize the risk of audits

6. What are the defenses, that a provider can raise

7. What are the certain branches of medicine that tend to feel more riskier in reimbursements

 

John Mills

[email protected]

www.nelsonhardiman.com

310-203-2800


Top Lawyers: Harry Nelson of Nelson Hardiman On The 5 Things You Need To Become A Top Lawyer In Your Specific Field of Law

From the article:

As a part of this interview series, I had the pleasure of interviewing Harry Nelson.

Harry, the founder of Nelson Hardiman, has been called the leading healthcare lawyer in America. Apart from his regulatory strategy work in other areas of healthcare and life science innovation, he developed the regulatory pathway for telehealth companies that were acquired in 2021 for collectively over $2 billion. His lessons from crisis response work in the overdose crisis led to the best-selling “United States of Opioids: A Prescription for Liberating a Nation in Pain.” Harry’s advocacy work related to America’s healthcare future has led to numerous awards and has produced tangible results to improve healthcare regulations at the federal and state levels.

Thank you so much for joining us in this interview series. Before we dig in, our readers would love to get to know you a bit more. What is the “backstory” that brought you to this particular career path in Law? Did you want to be an attorney “when you grew up”?

Can you tell us a bit about the nature of your practice and what you focus on?

My practice has 3 sides. For companies in areas of healthcare and life science innovation, like telehealth, behavioral health, genomic testing, stem cells, psychedelics, I function as a regulatory lawyer and strategist, helping early stage ventures navigate uncharted or less charted regulatory waters from ideation to all the way to wherever they want to go. For healthcare and life science companies in crisis due to regulatory mistakes (fraud, patient safety, privacy violations or other noncompliance), I help them fix what is broken — remediating compliance issues, repairing relationships internally, with government agencies, with insurance companies. And for many healthcare companies, I serve as a one- stop shop when they need outside regulatory counsel for ongoing business needs.

You are a successful attorney. Which three character traits do you think were most instrumental to your success? What unique qualities do you have that others may not? Can you please share a story or example for each?

I don’t think I would be where I am if I wasn’t driven. Life would be more fun if I wasn’t constantly driven to work relentlessly to produce the highest quality work product and advice, and to be the best. I would set better boundaries. My wife and my kids are ready to kill me sometimes because I am rarely fully away from the work. I will be on the ski lift with my kids and a client has an issue, and I am in the thick of it. I get a complete separation only from Friday night to Saturday night because we observe Shabbat, but I think that indefatigable drive is the number one thing that separates me from my colleagues.

I think my empathy has been a difference-maker. I once had a doctor who kept calling me. He lived on the other side of the country, but had gotten my name from a friend. He told me from the beginning that he was already working with two other lawyers I knew and respected, one of whom was nationally renowned, but I took his calls as a courtesy and then took a meeting with him. I kept telling him, “You’re in good hands already. You don’t need me.” He said to me, “I did my homework and I know I’ve hired the best people. But I also know that you are every bit as good as they are. And the difference is, when I talk to them, they leave me cold. But when I talk to you, I feel you are in it with me, and my anxiety just lifts.” It was an epiphany for me that part of my difference is that personal bond and my ability to give clients emotional support in a way other lawyers didn’t. He taught me not to hold back, to lean in to the emotional side of a client’s needs.

I think that my ability to manage stress and to process things quickly has been a key difference. I work in areas of law where the norm for lawyers is to be super-cautious and slow, and I know it drives clients crazy. There’s way too much hemming and hawing because it’s stressful to stake out a definitive position in areas where technology has outpaced the law, and where there’s confusion and ambiguity. I have come to the view that, as long as I am transparent about what I know and where I am thinking out loud, I can give clients my best advice in a way that is specific and in real-time, without making them wait for a memo a couple weeks later. I regularly have clients who tell me, “I spent the last six months and tens of thousands of dollars with other lawyers getting the run around, and you just gave me the answer on our very first call.” It only happens because I can manage the stress of being put on the spot constantly, process the situation, the challenge, calibrate to the audience, and give the answer that is needed.

Do you think you have had luck in your success? Can you explain what you mean?

I have unquestionably had some good breaks that you could call lucky. I was once standing in line at a hotel valet parking waiting for my car after an event, when a lawyer I knew from another firm walked by with a colleague and introduced me. That introduction produced one of my biggest clients of the past decade. I view the kindness of people on a daily basis who happen to think of me and make connections as the greatest kind of luck.

I’ve come to the belief that everything happens for a reason, that we can’t understand why good things happen or why bad things happen. All we can do is be grateful for the breaks we get and find a way not to hold onto anger and resentment with the ones that don’t go our way. I’ve got a way to go on that score, but I have learned to process things quickly so that I can move on and focus on the next thing.

Do you think where you went to school has any bearing on your success? How important is it for a lawyer to go to a top-tier school?

I am proud of being a Michigan alum. I think it mattered at the beginning of my career that it was a top school. It helped me get a clerkship with a judge in Hawaii, who maybe only gave me an interview because he was Michigan alum. It helped with my first job at a firm in Chicago, at a firm with other people from elite schools, having the right markers on my resume. But I know as many lawyers without fancy academic pedigrees who were as or more driven than me that have killed it. It definitely gives you a leg up in the early days of your career, but I also think over time, it really doesn’t matter where you went to school. And what I have seen being in Los Angeles is that it may be just as valuable to have a network of local alumni (be it USC or Loyola) than to have high- ranking school without a strong presence in the community.

Based on the lessons you have learned from your experience, if you could go back in time and speak to your twenty-year-old self, what would you say? Would you do anything differently?

I would say a few things:

First, I would say there are times I should have been more patient. I sold a big position out of Amazon when Webvan cratered that I can’t even think about. Hang in there on those bets.

Second, I would say it took me a while to really have fun with the work, to be myself fully, to feel a sense of not just purpose, but joy. I think my early days as a lawyer were too focused on making the senior folks I worked for happy, to meeting expectations, and not focusing on setting up the life that I wanted. I worried too much about what other people thought and not enough about what I needed. I would tell my younger self not to waste time getting to know my interior self and to embrace my work style, my risk tolerance, and my passions. I would spend more time with fellow creatives and people who are energizing.

Third, I would tell my younger self not to worry so much about fitting in. Law is a crowded marketplace where not standing out is basically the same as being invisible.

This is not easy work. What is your primary motivation and drive behind the work that you do?

It constantly changes. There was a point where I was convinced I was building an empire, a national practice and leaving a legacy. All it took was a taste of what mercenary times these are for so many lawyers for me to be dissuaded that that was a worthwhile pursuit.

There is a piece that is motivated by the satisfaction of providing for my family, of taking care of the people I love, of having the autonomy to make my own choices.

But I think my ultimate motivation is that I feel I am living my purpose when people bring me problems to solve, and I am able to work them out. I feel a sense of joy in connecting with people on the work, in learning of something new about feeling a momentary satisfaction about a job well done — before jumping into the next problem.

What are some of the most interesting or exciting projects you are working on now?

I have a handful of clients that feel like multi-billion dollar opportunities if they can work out the challenges in front of them. I am particularly excited about two projects I am working on at the cutting of personalized, genomic medicine that I think is about to revolutionize medicine. I am excited about a couple of clients who are at the forefront of psychedelic therapy, including one that is integrating psychedelics into telehealth to drive a transformation in how we treat depression and PTSD. I am really excited about a local health system client that is on the verge of rolling out a new model of behavioral health crisis response centers that have the potential to move the needle on overdose prevention and also on addressing homeless mental health issues.

Where do you go from here? Where do you aim to be in the next chapter of your career?

I am really enjoying myself these days. And I still feel passionate and energized by the work I try to make sure I am focusing on doing what I love, doing it well, staying on top of the next big things.

Beyond my practice, I am working with a publisher on a new book addressing America’s overdose crisis. I’ve been asked to get involved in some more television projects, and am trying to figure out a roadmap to make sure my public service messages for America’s healthcare future are being heard. I have gotten some informal inquiries about taking a leadership role in some type of (appointed, not elected) public service. I am taking interesting calls and keeping my ear to the ground.

I haven’t figured out what the next chapter is for me. I am trying to build up a strong cadre of colleagues who can bear more of the “heavy lifting” in client work that I currently do, so that I have the option to re-allocate more time to other projects, but that is a work in progress.

Without sharing anything confidential, can you please share your most successful “war story”? Can you share the funniest?

My favorite war stories involve jumping in at the last minute into projects that couldn’t be resolved by other people and taking care of business. I once got a call from the general counsel of one of the biggest telehealth companies in the country. He was panicked because the Medical Board of California was about to commence a hearing against one of their doctors. Their regular law firm handling the case had reassured them the matter would be settled on mutually agreeable terms, and then informed them that they were wrong, and there was no way to prevent the case from going forward in just over a week. The Deputy Attorney General handling the case was an impossible, ideological person, on a mission, who I had butted heads with before, and I knew she was never going to give ground. So I went over her head and made a direct appeal to the Board leadership and painted a picture of why this case needed to be shut down. Less than 24 hours before the case was scheduled to start, with the doctor about to board a plane to come to California, the case was dismissed. No explanation. Grateful client, very unhappy prosecutor.

My other favorite war story is that I had a publicly traded client in a different area of healthcare being railroaded out of California by a licensing agency. They had many locations, and it was going to be a disaster for them. I decided that the case needed a new lawyer, but that it would be better for me to bring in another law firm so I could serve as the expert witness. The strategy paid off when the administrative law judge found in his decision that I was the authoritative person on the issue in question (corporate practice medicine), as exemplified by the number of times that the Attorney General’s office kept citing me. He wouldn’t let them pick and choose. It was a case with hundreds of millions of dollars at stake for the client, and my testimony won the case. The state agency adopted it and abandoned a multi-year battle with the company.

The funniest story for me was the one that led me to become the very first healthcare lawyer in the country to start doing medical marijuana work. In 2009, the Obama Administration had just announced it would stop raiding California’s medical marijuana dispensaries if they complied with state guidance. I was known for my DEA-related work, including petitioning for DEA research permits for cannabis, so my phone started ringing off the hook with marijuana-related clients. I said, “I don’t really know much about medical marijuana law beyond doctors. Let me find the right lawyer who understands dispensaries, cultivation, product development. I called around and found the lawyer everyone in town described as the expert. Everyone else advising was a criminal defense lawyer, but this was the preeminent “corporate lawyer” for cannabis in California. I left a voicemail message for him. He called me back and we had a nice conversation late in the day. I was getting ready to email the people who called me his name the next day, when he called me again. He literally had no recollection whatsoever that we had already spoken. I realized he had been as high as a kite in both conversations. I decided I couldn’t in good faith give his name to anyone, so I decided to roll up my sleeves and start learning cannabis. Within a year, we had the biggest cannabis practice in Southern California. The lawyer later became a client and a friend, but to this day, I credit him with inspiring me to tackle the space.

Ok, fantastic. Let’s now shift to discussing some advice for aspiring lawyers. Do you work remotely? Onsite? Or Hybrid? What do you think will be the future of how law offices operate? What do you prefer? Can you please explain what you mean?

Personally, I like to be in the office. It’s quiet these days (more than half of our team is still remote), but I like the ability to bounce ideas around with my colleagues who are there. The work is getting done, but I would say some of the emotional support and connection we give each other is gone when everyone is remote. I also think it is weakening our culture and the bonds that tie us together. I already hate how mercenary law practice has become, and I think this makes it worse. I am trying to make the most of it personally by traveling more, taking advantage of the ability to be someplace else, stretching out my time away. I think it is the future. We have 42,000 square feet of space and can function with a fraction of it in the post-pandemic world. I would not want to be in the commercial real estate business. Law firms are going to get much more space efficient, and I think we are going to see a wave of innovation in digital tools to let u better connect remotely.

How has the legal world changed since COVID? How do you think it might change in the near future? Can you explain what you mean?

There have been some positive changes. I used to have many projects that needed an in-person meeting to get going. These days, everyone is just fine with an initial meeting or a kick-off via Zoom. I think location matters less than ever. We are getting new clients all over the country and also globally more than ever. At the same time, we are competing with good lawyers and firms all over the country, so it forces us to up our game. As a healthcare lawyer, COVID has also brought up many new legal issues for us to tackle, and driven the growth of pandemic-friendly businesses, like diagnostic lab testing and telehealth that were already sweet spots for us.

We often hear about the importance of networking and getting referrals. Is this still true today? Has the nature of networking changed or has its importance changed? Can you explain what you mean?

I would be nothing without an amazing network of lawyers at other firms and former clients who give my name out all over the place, who vouch for me, and who sing my praises when people need someone who does what I do. So networking is still critical to me. The pandemic put our ability to nurture our networks on hold, because we stopped seeing each other, and were limited to more impersonal emails and calls. I have had a slight advantage with regular TV appearances because I tend to be highly visible on social media so people don’t forget about me. But networking in person will be a big focus again with COVID hopefully in check.

Based on your experience, how can attorneys effectively leverage social media to build their practice?

It keeps evolving. At one point, I had massive visibility on LinkedIn, and then they changed their algorithm, and I went from thousands of views per day to several hundred per week. I have had good results with Facebook, although I am still learning. I feel like I am still at square one in learning how to use Instagram for engagement. I think of social media as a visibility tool which is useful for activating my network. The work flows mostly through the network, but the social media visibility keeps me on the network’s mind.

Excellent. Here is the main question of our interview. What are your “5 Things You Need To Become A Top Lawyer In Your Specific Field of Law?” Please share a story or an example for each.

1. Research: You are dead in the water in healthcare law if you aren’t on top of the latest regulation or pronouncement in whatever jurisdiction you are dealing with. The ground is constantly shifting. I’ve picked up more than a few clients because their last lawyer missed a particular change. For example, after Medicare announced the 36-month rule limiting home health agency changes of ownership, I saw an influx of work because one of our competitors had failed to advise client that it was coming.

2. Writing: I am in the business of persuading investors or acquirers of early stage ventures that the regulatory compliance concerns expressed by other lawyers are not a real problem — or that they are addressable. I am constantly relying on my ability to write to win hearts and minds and get deals done. Just last week, we had a national law firm ready to kill an acquisition of one of our clients over an expressed compliance concern. I generated a memo that convinced the other firm’s client that they were being unduly conservative. This work is all about the writing.

3. Speaking: There are many moments when being able to deliver the message clearly and succinctly is the difference between success and failure. I have been though a number of eleventh hour conversations where being confident and firm makes the difference as to whether the deal gets done or not.

4. Problem-Solving: So much of the work is figuring out the best way to navigate through the puzzle. People call us when they are stuck or confused or lost. The job comes down to knowing the landscape and then thinking critically, thinking creatively, and thinking quickly, because something bad is going to happen if we don’t figure out the solution and get it done.

5. Interpersonal: I don’t see how you can be successful if you can’t listen, relate to clients and make them feel heard and understood. People need to really be able to trust and rely on their lawyer on sensitive healthcare questions.

We are very blessed that some of the biggest names in Business, VC funding, Sports, and Entertainment read this column. Is there a person in the world, or in the US with whom you would love to have a private breakfast or lunch, and why? He or she might see this. 🙂

I get to interact with more sports and entertainment celebrities than you might think who are considering or joining cutting edge healthcare/life science ventures, and my job is to settle down VCs so clients can get the funds they need. If I had to confess a fascination, I would love a chance to schmooze with Elon Musk. I love his drive to innovation and would like to sell him on some life science opportunities. Slightly geekier second choice would be to pick Ray Kurzweil’s brain. I have a lot of questions for him.

This was very inspiring. Thank you so much for the time you spent with this. We wish you continued success and good health!

_______________________________________

Contact: [email protected]

 


Partner Harry Nelson on Good Morning Britain discussing Britney Spears’ Conservatorship Coming to An End

Harry Nelson on Good Morning Britain discussing Britney Spears’ conservatorship coming to an end.

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Client Alert: MultiPlan Named As Central Figure In Antitrust Lawsuit Alleging Health Insurance Monopoly Scheme

The liquidating bankruptcy trust for Verity Health System of California recently filed a lawsuit in the Superior Court of the State of California, County of San Francisco, against third-party “re-pricer” MultiPlan, including its subsidiaries Viant and Data iSight, and more than a dozen of MultiPlan’s customers – including major commercial payers like Anthem, United Healthcare, Aetna, Cigna, and others – alleging antitrust claims under California’s Cartwright Act and Unfair Competition Law.

According to the lawsuit, MultiPlan acted as an unlawful “corporate hub” of a classic “hub, spoke, and rim” agreement among the re-pricer and its various insurance company clients, to “fix” the amounts that would be reimbursed to healthcare providers on out-of-network claims. The complaint alleges that reductions in reimbursement payments for healthcare services rendered by providers nationwide totaled approximately $10 billion per year from 2012 to 2020, driving up profits for MultiPlan’s insurance company clients, and also for MultiPlan itself.

Indeed, the timing of the lawsuit is significant, as it comes on the heels of MultiPlan recently going public in one of the largest transactions of its type ever, with an $11 billion company valuation.

Regarding the scheme at the center of the lawsuit, the complaint alleges that MultiPlan entered into a series of contracts with the various commercial payers, by which MultiPlan was paid to provide the commercial payers with the same artificially deflated payment data, which the commercial payers would all in turn utilize to reimburse their out-of-network healthcare providers at the same reduced rates. According to the complaint, MultiPlan’s commercial insurance customers implemented the identical MultiPlan-set reimbursement rates nearly all the time, and due to MultiPlan’s dominance in the industry, and the imbalance of power between individual healthcare providers and MultiPlan’s stable of insurance company clients, providers have bothered to appeal the MultiPlan rates only about 5% of the time going back to 2011. As the complaint puts it, healthcare providers “have no choice but to accept those prices, given the conduct at issue in this Complaint, as resistance would be futile.”

This lawsuit and its potential effect on the healthcare industry is reminiscent of the industry shake-up that occurred over ten years ago. In 2009, following an intensive investigation, the New York Attorney General’s Office issued a Report and subsequent enforcement action against then-United Healthcare subsidiary Ingenix that found that Ingenix “gathers billing data from the largest health insurers in the county . . .and then sends back schedules to these health insurers and others, based on the pooled data, which the insurers use . . . to set their reimbursement rates.” The Report further noted that the Ingenix databases “understate[d the] market rate by up to 28 percent [and caused] at least hundreds of millions of dollars in losses” for providers and consumers of the prior ten years. The New York AG’s Office forced the shut-down of Ingenix and helped pass a New York law prohibiting commercial insurers’ use of affiliated “repricing” businesses. The New York AG actions likewise led to several class action lawsuits, resulting in settlements totaling more than $2 billion.

These claims of “Monopoly!” will likely resonate with healthcare providers of all types and practices, who have long felt powerless in the face of the increasingly behemoth insurance industry. That MultiPlan may now be at the center of it all is probably no surprise to many. Whether this new lawsuit – significantly, a private action as compared to the New York Attorney General’s Office investigation of Ingenix – can yield similar results remains to be seen. But the wheels have been set in motion, and perhaps this lawsuit will result in substantial movement towards a more equitable reimbursement model.

We invite you to contact us with any additional information you have obtained regarding this important matter.

Authored By:

Zachary Rothenberg  E:[email protected]

VIEW CLIENT ALERT

*This article is provided for educational purposes only and is not offered as, and should not be relied on as, legal advice. Any individual or entity reading this information should consult an attorney for their particular situation.*


Nelson Hardiman Recognized by U.S. News & World Report’s “2022 Best Law Firms in America” for Health Care Law

Nelson Hardiman was awarded a Tier 1 ranking in Health Care and Administrative/Regulatory Law by the U.S. News & World Report’s “2022 Best Law Firms in America.” The U.S. News “Best Law Firm” rankings are based on a rigorous evaluation of client and lawyer evaluations peer review and leading attorneys in their field. The 2022 rankings incorprate 8.2 million evalutations  of more than 115,000 individual leading lawyers from more than 22,000 firms. Firms included in the 2022 Edition of U.S. News-Best Lawyers “Best Law Firms” are recognized for professional excellence with consistently impressive ratings from clients and peers. To be eligible for a ranking, a firm must first have a lawyer recognized in The Best Lawyers in America©, which recognizes the top 5% of private practicing lawyers in the United States. Achieving a tiered ranking signals a unique combination of quality law practice and breadth of legal expertise.

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Nelson Hardiman Successfully Defends Medical Board Charges Brought Against Physician Client

Nelson Hardiman LLP successfully represented a physician client following a complaint filed against him by the Medical Board of California. The complaint alleged, among other charges that the client violated the California prohibition against the corporate practice of medicine pursuant to Business and Professions Code § 2052. The firm successfully defended the arrangement between a Management Services Organization (MSO) and the client’s professional corporation (PC) through an in-depth and comprehensive review of organizational and transactional documents between the entities. After a thorough review, the MBC declined to proceed with the case and closed the investigation without action, effectively conceding that there was no violation of corporate practice of medicine.

For questions regarding Medical Board inquiries and health professional licensure issues please contact Alan J. Sedley at [email protected].

About Nelson Hardiman

Nelson Hardiman LLP is the premier healthcare and life sciences firm in Los Angeles, serving healthcare providers, investors, and organizations that need a hard-to-find level of quality advice on the most sensitive industry issues. The firm’s litigation practice specializes in defending fraud and abuse and whistleblower actions, government investigations, reimbursement disputes, and other complex business disputes. Nelson Hardiman regularly serves as outside counsel for healthcare system clients and medical staff representation. Nelson Hardiman’s transactional group handles healthcare organization acquisitions, sales, investment, and financings, and Nelson Hardiman’s regulatory team advises on compliance with licensing, operational, and reimbursement issues across the full continuum of healthcare industry sectors, with expertise on Medicare and Medicaid requirements, privacy and data security, FDA, and many more matters. The firm has earned a singular position reputation nationally for its leadership in addressing issues in behavioral health. More information about the firm is available at www.nelsonhardiman.com or at 310.203.2800.


Nelson Hardiman Advises Lemonaid Health in Merger with 23-and-Me

Nelson Hardiman served as healthcare regulatory counsel to Lemonaid Health in connection with its $400 million merger with 23-and-Me. The merger brings together the ground-breaking innovation of 23-and-Me, in direct-to-consumer DNA testing and biotech, and Lemonaid, in direct-to-consumer telemedicine and prescription drug delivery.

“We are grateful for the regulatory counsel of Harry Nelson and the Nelson Hardiman team in this transaction,” said Lemonaid CEO Paul Johnson. “Their advice has been invaluable throughout our growth.”

Los Angeles-based Nelson Hardiman LLP specializes in healthcare and life sciences regulatory strategy, and is known for its pioneering work in telehealth innovation. Firm founder Harry Nelson has served as lead regulatory counsel to Lemonaid Health since its launch in 2014 and counseled the company through its growth on compliance with laws related to telemedicine, corporate practice of medicine, pharmacy, marketing, privacy, and data security. Nelson commented: “It has been a genuine privilege to advise Lemonaid Health, both on this deal and throughout its history. The Lemonaid leadership have been visionaries as to the future of U.S. healthcare. We appreciate the trust they have placed in us.”

In addition to Harry Nelson, the Nelson Hardiman team advising Lemonaid, included Regina Trainor, Aviva Morady, and Daniel Eliav, with Daniel Eliav’s leadership of the deal team. Nelson Hardiman’s work on the merger included assistance with healthcare regulatory due diligence, advice on structuring to address health care laws and regulations, drafting of healthcare-related provisions of transaction documents, and ongoing compliance advice.

More information on the transaction is available via 23-and-Me’s press release.

About Nelson Hardiman
Nelson Hardiman LLP is the premier healthcare and life sciences firm in Los Angeles, serving healthcare and life science providers, investors, and organizations that need experts on the most difficult questions with deep industry knowledge and relationships. The firm’s litigation practice specializes in defending fraud and abuse and whistleblower actions, government investigations, and other complex business disputes. Nelson Hardiman’s transactional group handles healthcare organization acquisitions, sales, investment, and financings, and Nelson Hardiman’s regulatory team advises on compliance with licensing, operational, and reimbursement issues across the full continuum of healthcare industry sectors, with expertise on Medicare and Medicaid requirements, privacy and data security, FDA, and other regulatory matters. The firm has earned a singular position reputation nationally for its leadership in addressing issues in behavioral health, telehealth, corporate practice of medicine, and emerging therapeutic modalities. More information about the firm is available at https://www.nelsonhardiman.com or at 310.203.2800.

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