HEALTH & LIFE SCIENCES NEWS
HEALTH & LIFE SCIENCES NEWS
Exploring Critical Business and Legal Issues across the Healthcare and Life Sciences Industries
HEALTH & LIFE SCIENCES NEWS
Exploring Critical Business and Legal Issues across the Healthcare and Life Sciences Industries

5 Questions with a Health Lawyer: Christopher M. Olson

Christopher M. Olson
Practice Focus Area: Health – Transactions
Office: Los Angeles
Years at Firm: 7

What is your favorite part about practicing healthcare law at McDermott?
My favorite part about practicing healthcare law at McDermott is meeting and working with the top individuals in the healthcare industry. Both the clients and the McDermott attorneys are at the forefront of the healthcare industry. The projects that come across my desk are complex and often address the most pressing issues for clients. Working with top attorneys to devise innovative solutions to these challenges is my favorite part about practicing healthcare law at McDermott.

What is the biggest opportunity and greatest challenge facing clients in your area of focus today?
One of the greatest challenges facing hospitals and health systems in California is determining if a sale or joint venture is in their best interests. The California Attorney General has recently taken a more proactive approach when reviewing non-profit hospital transactions in California, making it more difficult to ascertain the effects of a transaction. In addition to imposing generally expected conditions such as requiring certain annual levels of charity care or that hospital service lines remain open for 10 years post-closing, the California Attorney General recently imposed a number of competitive impact conditions that limit how the target hospital can integrate with the acquiring hospital post-closing. These competitive impact conditions include requiring the two hospitals to have separate payor negotiating teams and capping the target hospital’s annual growth of reimbursement charges. These conditions may limit future non-profit hospital transactions so, better understanding their future use and effects may also present an opportunity for California hospitals and health systems.

What kind of client work gets you most excited when it comes across your desk?
I really enjoy taking a first pass through a definitive transaction document. Transforming a client’s goals from a brief phone call or email into a well-structured purchase agreement is extremely rewarding. I enjoy learning about the business reasons why a client is pursuing a transaction and then tailoring the definitive agreement to meet those needs.

What is the proudest moment of your career to date?
The proudest moment of my career to date was successfully representing a client in its acquisition of an acute care hospital from a non-profit hospital system that had filed for Chapter 11 bankruptcy protection. The financially distressed target hospital provided much-needed services to a low-income community in Los Angeles. There was a real possibility that the hospital would have had to close its doors if the transaction was delayed. Leading a team that allowed that hospital to remain open to service a community that was particularly hard hit by COVID-19 was a highlight of my career.

What is your favorite decoration in your office?
My favorite decoration in my office is a replica of the HMS Endeavour. The HMS Endeavour was a British Royal Navy research vessel captained by James Cook in the late 18th century and is famous for its exploration of the Pacific Ocean, including as the first European ship to reach the east coast of Australia. The Endeavor also holds some sentimental value, as it was a law school graduation present from my parents.

Click here to learn more about Chris’ practice.



McDermott Will & Emery and EY during the 2021 J.P. Morgan Healthcare Conference: Hospital and Health System CEO Panel: Strategic Business Priorities

Our panel included a discussion on what is ahead for 2021 and how the challenges of COVID-19 will lead to lasting changes for hospitals and health systems, with Lloyd Dean (CEO, CommonSpirit), Melinda Estes, MD (President and CEO, St. Luke’s Health System) and Jaewon Ryu, MD (President and CEO, Geisinger). These top healthcare leaders discussed the short- and long-term impact of COVID-19 on hospitals and health systems and their strategic business priorities in 2021 and beyond with moderator Kerrin Slattery (Partner, McDermott Will & Emery).

Below are the top takeaways for McDermott Will & Emery and EY during the 2021 J.P. Morgan Healthcare Conference: Hospital and Health System CEO Panel: Strategic Business Priorities, click here to access the full webinar.

Access the PDF here.

HOW 2020 PRIORITIES WILL SUSTAIN AND PROVE HELPFUL IN 2021 AND BEYOND
For hospitals and health systems, 2020 began and was primarily focused on issues like cost and payment models, Medicaid expansion and the wellbeing of clinical providers, including physicians, where statistics cite 40% are burned out. SinceCOVID-19, hospitals instantly pivoted to healing their communities and their staff, as well as rejuvenating the delivery system. “I was very pleased to chair a task force on COVID-19 pathways to recovery that produced a dynamic document that has been out for about 5,000 of the hospitals in this field; how do we get back to better business? How do we rebuild? How do we reimagine? So if you’re going to look at what I’ll call “AC”, “after COVID”, the (American Hospital Associations’) priorities are really what I’ll call the three R’s—relief, rebuilding and recovery,” Melinda Estes, MD, president and CEO at St. Luke’s Health System, said.

INVESTMENTS AND STRATEGIES PRE- AND POST-COVID-19
The trust of the community has been instrumental in providing guidance and counsel around the approaches for care and pre-pandemic investments in innovative and patient-centric care models proved critical during the pandemic. Such approaches helped hospital systems tackle care differently and made it easier and efficient for patients. “A couple of examples of programs we’ve invested in over the last several years, one has been something we call the ‘Geisinger At Home Program,’ where we take the sickest 3% to 5% of our patients and deliver the care and move services into the home. And when we did this, we found that their [emergency room] use rate dropped by about 40% and their hospital use rate dropped by about 25%,” Jaewon Ryu, MD, president and CEO at Geisinger, said. “Another example is our mail-order pharmacy, where we’ve seen 37% higher medication adherence rates in that program; being able to continue to deliver drugs and get them into the hands of those who need them during this pandemic was instrumental.” Post-COVID, such patient centered approaches will necessarily expand.

IMPROVING HEALTH EQUITY IN COMMUNITIES OF COLOR
COVID-19 exposed an endless number of issues with the health care delivery system and shone a light on the lack of health equity within communities of color. While hospital systems have already invested in improving health equity, there is recognition that there is much more work to do, and such work needs to focus on specific strategies and programs that are reflective of the community, in concert with other organizations., With the development of best practices and data outcomes, additional opportunities could be explored across communities. “We know that in communities of color, having physicians and caregivers that look like the demographic of the community improves care, improves access and that’s just a way of saying that it takes all of us, Lloyd Dean, CEO at CommonSpirit, said. “We’ve also seen that without having a fair and just system in place, (with) accessible care, quality care for all, that it has a dramatic effect on certain groups in segments of our society,” he continued.

THE IMPACT ON THE WORKFORCE IN LOCAL COMMUNITIES
COVID-19 catalyzed the movement toward work from home for those that were able to do it, but it also created workforce shortages for hospitals and health systems. Taking care of caregivers, who have resiliently made sacrifices to work during the pandemic, will continue to impact the future. Caregivers in hospitals and health systems are experiencing exhaustion as well as other hardships. “How do we relieve them of that [exhaustion]? We have to take some of the other burdens off of them in that it is a perfect storm when you have to worry about employment, you have to worry about how do I educate my child. Our responsibility as an employer, I think we are called to revisit those and to revisit those with our caregivers and our employees. I think all of those kinds of things when we think about workforce training, where work is delivered, how it’s being delivered, what’s the role of technology are all on the table,” Lloyd Dean said.
For the large non-clinical workforce of hospitals and health systems, there remain similar issues. “Will a large number of folks stay working remotely? It raises a number of other issues as we pivot toward that. One is just giving our managers the tools and skills to manage a little more remote workforce. The second is how do we maintain our culture? How do we maintain connection with that remote workforce,” Melinda Estes, MD, said.

To catch up on all of the sessions at the McDermott Will & Emery and EY during the 2021 J.P. Morgan Healthcare Conference, please click here.



McDermott Will & Emery and EY during the 2021 J.P. Morgan Healthcare Conference: Digital Health Pioneers Forum

 

 

Top industry executives BJ Moore, Executive Vice President and Chief Information Officer, Providence St. Joseph Health; Dr. Ali Parsa, Chief Executive Officer, Babylon Health; and Lucia Savage, Chief Privacy and Regulatory Officer, Omada Health, discussed the evolving doctor-patient relationship and the digitized data and technology convergence with healthcare delivery and payment along with moderators Dale C. Van Demark, Partner, McDermott Will & Emery; Rachel S. Hall, Partner, Digital Health Leader, EY; Stephen W. Bernstein, Partner, McDermott Will & Emery; and Lisa Schmitz Mazur, Partner, McDermott Will & Emery. They also provided insight into 2021’s regulatory considerations affecting healthcare innovation and its solutions.

Below are the top takeaways for McDermott Will & Emery and EY during the 2021 J.P. Morgan Healthcare Conference: Digital Health Pioneers Forum, click here to access the full webinar.

Access the PDF here.

CARE OF THE FUTURE
We are only seeing the beginning of the decentralization of care through information technology; but that shift is how scalable solutions to our health care challenges will develop. “Care delivery at home, where we can send patients home and remotely monitor them—eventually that will evolve to things like wearables -IoT devices- that we may have in our clinical settings. We’re seeing the hospitals play such a critical role during COVID-19, but what’s also been even more apparent as these alternative means of delivery develop is really how we’re going to scale and change the patient experience and ultimately improve the patient outcome,” BJ Moore, executive vice president and chief information officer at Providence St. Joseph Health, said.

PATIENT EMPOWERMENT AND REDUCING CAREGIVER BURNOUT
“By putting that patient in the center, giving them multiple modes of care and allowing that patient to select those modes of care, it ultimately improves that patient experience. But we also recognize it can’t all be on the patient’s shoulders,” BJ Moore said. Nor can we simply burden the provider community with more data and more tasks and expect the promise of digital tools to be achieved. BJ Moore continues, “It’s probably our single biggest issue in healthcare: caregiver burnout and caregivers overwhelmed. We see that as an issue. There’s more help that we need to deliver for the caregivers. Right now, if you look at technology and healthcare, from my opinion, one plus one equals one. And really what it should be is technology should be a force multiplier; what our caregivers put in, that one plus one should equal 10. They should feel like they get a lot more out of the systems (than) they put in.”

EXPANDING ACCESS TO CARE
Digital health has the potential to make care more accessible. But, for communities without access to technology, we need to figure out how to deliver virtual care. We must ensure emerging technologies do not exacerbate existing health disparities. “The question for (Babylon) was can we do with healthcare what Google did with information: Can we make it accessible and put it in the hands of every human being on Earth? If you think about it, (of) the $10 trillion we spend on healthcare globally, only about 50% of the world’s population (has) any access and about five to seven billion people on our planet actually have no access to any secondary healthcare at all,” Dr. Ali Parsa, chief executive officer at Babylon Health, stated. He continued, “So we sat back and said, accessibility is almost easy because today everybody has a device in their hand, one of these in one format or on their mobile phone, and we can deliver most of the healthcare most people need on the devices. Most people already hav(ing) what could solve the accessibility problem.”

INFORMATION BLOCKING & PATIENT TRUST
One of the critical challenges for digital health is the gap between the promise of the technology and the level of trust consumers have in the technology sector. “We have to actually solve this problem for digital health to advance, and that’s a goal of the digital health industry because consumers do not trust what the industry is doing with their data,” Lucia Savage, chief privacy and regulatory officer at Omada Health, said. She continues, “As a privacy officer answering questions from not only our actual members but people who are interested in our program and want to know how it works, it’s a combination of regularly regulation but also more protection for the user against adverse effects of having that data flowing around the system, maybe more protection against discrimination, etc. And so that’s something that people should really look at, but the industry has to speak up on this because the trust has to be inherent.”

ACCESSIBILITY AND AFFORDABILITY
Two of the biggest problems in healthcare are accessibility and affordability. Digital health has the potential to make healthcare accessible and affordable for all. “In cases where communities don’t have the technology, we need to figure out how we deliver that care,” BJ Moore stated. They may not have reliable internet access, so when we talk about care delivery at home, we’re talking about 5G in a box. So not only sending them home with a smart thermometer and pulse oximeter but sending them home with a 5G hotspot that makes sure that they have internet access to receive that care. In return, they get better health and therefore it’s lower cost to serve those communities. So we definitely see there’s more work to be done, but we see technology already helping us serve those communities. And then you’ll see us investing in those communities to ultimately improve their health outcomes and reduce the cost of care delivery.”

MOVING BEYOND FEE-FOR-SERVICE
The fee-for-service reimbursement model is a fundamental problem in our healthcare system. We need to support alternative systems that inject quality into healthcare delivery. “So there is nothing radical about saying that the payment model in healthcare (is) fundamentally wrong and we should fix it. It’s actually an insane way of doing it. It’s just normal, should be done this way and I think both providers, payors, everybody will benefit from the challenges. Everyone is hooked on this fee-for-service model, the whole system, and yet nobody has got the courage to change the system,” Dr. Ali Parsa said.

ON-DEMAND DIGITAL INTERVENTIONS FOR 2021
The wide adoption of digital tools has an increasing demand in healthcare and creating digital interventions are at the forefront of being developed and analyzed. The impact of digital health innovations can change the trajectory of communities and grows the cost-effectiveness of interventions by reaching a community quicker through content and delivery. “I have my eye squarely on rural underserved communities and disparities because I think that with the data science and the delivery, it’s really a phenomenal opportunity,” said Lucia Savage. “An example will be a model where Omada participated in a Medicaid pilot in Maryland of a diabetes prevention program (DPP). We were in a bake-off with an in-person DPP and Medicaid participants preferred Omada (Health) two to one. You know why? Because they could read a lesson on the bus, on their way to work in the morning or taking their kids (to school). Our members didn’t have to rearrange their lives to go to a particular place in the middle of the week, and that is a really important object lesson. The second thing on the delivery front is protocols that can be delivered outside of the building. Sean Duffy has a great article in New England Journal from three years ago called, ‘When the Hospital is Option B,’ but it’s about digital health’s ability to provide or support a person arranging for themselves relevant health improving protocols outside of the building.”

To catch up on all of the sessions at the McDermott Will & Emery and EY during the 2021 J.P. Morgan Healthcare Conference, please click here.



McDermott Will & Emery and EY during the 2021 J.P. Morgan Healthcare Conference: Election and Policy Implications: Healthcare Regulatory and Policy Outlook with the New Administration

The 2020 election gave Democrats the White House and control of both houses of Congress-an eleven seat majority in the House and Representatives, and a 50/50 split in the Senate with Vice President-elect Kamala Harris available to break ties. This change in the political landscape will lead to shifts in the health policy and regulatory agenda.

The panel, featuring Eric Zimmerman, McDermott Global Health Practice Lead; Brian Fortune, Senior Managing Director, Farragut Square Group; Mara McDermott, Vice President, McDermott+Consulting; Heather Meade, Principal, Health Care Policy, Washington Council Ernst & Young; and Thomas Scully, General Partner, Welsh, Carson, Anderson, and Stowe, discussed advice for investors as change comes to Washington.

Below are the top takeaways for McDermott Will & Emery and EY during the 2021 J.P. Morgan Healthcare Conference: Election and Policy Implications: Healthcare Regulatory and Policy Outlook with the New Administration, click here to access the full webinar.

Access the PDF here.

THE TRANSITION
President Biden was sworn in on January 20, 2021, and one of his first orders of business has been confirming new cabinet officials. Some key officials, such as Treasury Secretary Janet Yellen and Department of Defense Secretary Lloyd Austin, were easily confirmed in a bipartisan vote. However, others- like the nominee for Secretary of the Department of Health and Human Services, Xavier Becerra- will face challenges in a closely divided Senate.

COVID-19 RELIEF
Responding to the COVID-19 pandemic will be a high priority for the incoming administration and Congress in the early days of 2021. Expect relief efforts to continue to focus on managing the spread of disease through public health measures, vaccines and repairing the virus’ economic damage, including for providers. The administration’s announcement that it will likely extend the current public health emergency (PHE) through the end of 2021 means that waivers, like telehealth payment regulations and the hospital without walls program, will continue, which will afford stability and certainty. Executive Orders and a National Strategic Plan to address the epidemic have already been issued and we expect more guidance like this to come in the days and weeks to come.

COVERAGE AND THE AFFORDABLE CARE ACT
Expect several converging factors to keep the coverage debate front and center in 2021, including sweeping layoffs, rising healthcare costs for employers and the looming legal challenge to the Affordable Care Act (ACA). Watch for Congressional Democrats to pursue coverage expansions and shoring up the ACA in the early days of the 117th Congress.

PRESCRIPTION DRUG PRICING
Action on prescription drug pricing has been a priority for Democrats and Republicans in Congress and across administrations, but success has remained elusive. Expect a return to the bargaining table on this issue in 2021 and beyond.

MEDICARE ADVANTAGE AND PROVIDER RISK CONTRACTING
The Trump administration took a very favorable policy view toward the Medicare Advantage program, implementing year-over-year payment increases and finalizing additional flexibility for plans. At the same time, the Trump administration took a more critical view of accountable care organizations, particularly those led by hospitals and academic medical centers. Expect the Biden administration to flip this—taking a closer look at Medicare Advantage payment and regulation and a friendlier tone toward traditional players in the accountable care space. We expect Trump administration models, like Global and Professional Risk Direct Contracting, to move forward, with possible tweaks to the financial methodology.

To catch up on all of the sessions at the McDermott Will & Emery and EY during the 2021 J.P. Morgan Healthcare Conference, please click here.



Five Questions with a Health Lawyer: Justin P. Aiello

Justin P. Aiello
Practice Focus Area: Healthcare M&A
Office: Miami
Years at Firm: 7

What is your favorite part about practicing healthcare law at McDermott?
The wealth of knowledge maintained by our more than 120 attorneys who are dedicated to practicing healthcare law. Healthcare law comprises dozens of subspecialties and most of our client matters require a broad understanding of multiple subspecialties to provide exceptional advice. No single person can be knowledgeable in every subspecialty. It is our group’s collective practice, in nearly every healthcare subspecialty, that enables our attorneys to provide comprehensive, seamless advice regarding our clients’ healthcare investments.

What is the biggest opportunity and greatest challenge facing clients in your area of focus today?
The biggest opportunity still seems to be consolidation—perhaps the simplest and most reliable investment thesis. Despite all of the consolidation in the healthcare industry over the last couple of decades, the physician practice space remains highly fragmented with ample opportunity for gaining competitive advantages and cost savings through scale while still delivering excellent patient care. The biggest challenge (and perhaps also an opportunity) may come with the shift from fee-for-service to value-based reimbursement and its potential impact on the financial modeling on which many investment decisions have been based.

What kind of client work gets you most excited when it comes across your desk?
I enjoy representing our private equity clients in their initial platform investments in physician practice management (PPM) businesses. PPM transactions raise complicated structuring considerations: we must find ways to meet our clients’ investment objectives while also complying with myriad healthcare laws, including corporate practice of medicine (or similar), fraud and abuse (Stark and AKS), fee-splitting, HIPAA and others. Finding a compliant structure to achieve these objectives requires a team of attorneys who have both legal and business expertise.

What is the proudest moment of your career to date?
Making partner at the best healthcare law firm in the country, especially given that I started here as a summer associate. Not many attorneys remain with the law firm at which they begin their careers. The fact that so many do here is a testament to McDermott’s positive and supportive environment.

If you were not a lawyer, what career would you pursue?
Definitely a starting center for the Miami Heat.

Click here to learn more about Justin’s practice.



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