Health Law
For over 50 years, the attorneys of Vedder Price P.C. have counseled and advocated on behalf of a broad spectrum of clients in the health care industry. Those clients include major health care provider institutions and health care systems; physician organizations; managed care organizations; individual and group health care practitioners and practices; professional membership associations; and a variety of other not-for-profit organizations and foundations and for-profit enterprises.
Through representation of an expansive array of health care clients, attorneys in the Practice Area and the firm have accumulated substantial and wide-ranging experience that collectively constitutes a full-service health care law practice. Following is a summary of our experience in certain of these areas, noting representative projects.
Affiliation, Purchase/Sale and Merger of Health Care Facilities
The firm’s health care attorneys have represented numerous health care clients in merger, acquisition, affiliation and purchase/sale transactions. Our activities include negotiating, structuring and documenting these transactions, as well as downsizing, conversion or closure of health care facilities. The collective experience of the attorneys within the Practice Area includes the successful completion of such projects for major tertiary care hospitals as well as community-based institutions. Practice Area and firm expertise in corporate transactions, antitrust counseling, Hart-Scott-Rodino filings, joint ventures and restructuring augment the Area’s merger, acquisition, sale and affiliation practice. ERISA/Benefits and Labor expertise provides valuable support to this segment of our practice and in particular to issues arising from downsizing or closure situations.
Antitrust
As health care entities increasingly engage in joint ventures, networks and other collaborative relationships, they must carefully consider the antitrust implications of such arrangements, most notably under Sections 1 and 2 of the Sherman Act and Section 7 of the Clayton Act. Federal and state enforcement agencies as well as private parties have been increasingly active in scrutinizing and, in some cases, challenging mergers, joint ventures and other arrangements among health care providers. As consolidation occurs among health care providers, the antitrust considerations in such arrangements are becoming increasingly complex and important.
Attorneys in the firm have broad experience in assessing the antitrust considerations facing health care providers. We have participated in structuring proposed multihospital mergers, affiliations, joint ventures and networks so as to reduce antitrust exposure; conducted market share and market power analyses to assess the antitrust risk of these activities; and evaluated the need for, and then assisted clients as they prepared to file, premerger notification under the Hart-Scott-Rodino Antitrust Improvements Act.
Behavioral Health Providers
As the health care environment becomes more complex, all types of providers have needed to address new types of challenges. For behavioral health providers, including those delivering mental health, child welfare and/or substance abuse treatment services, these issues are especially critical. Members of the Practice Area have assisted numerous behavioral health providers in meeting these demands through development of multiple corporation affiliations and corporate reorganizations designed to strengthen the ability of behavioral health providers to function in managed care environments. In addition, we have served as special counsel to federal, state and county governmental agencies in the development of Medicaid managed care programs for behavioral health services.
Corporate Restructuring, Network and Integrated Delivery System Development
Members of the Health Law Practice Area and the firm have extensive experience in structuring and restructuring health care entities, creating new relationships among health care entities, and resolving the numerous legal issues that arise in connection with corporate reorganizations, affiliations and network/integrated delivery systems development. Through representation of health care institutions, physician groups and medical societies, the Practice Area has acquired a unique perspective with respect to integration of hospital and physician interests. This combination of experience has allowed us to provide our clients with highly effective representation in health system restructuring, network formation and the formation and operation of hospital-physician relationships. Our activities include participation in strategy and planning meetings regarding the merits of restructuring and analysis of the relative advantages and disadvantages of various models from both legal and operational perspectives. Familiarity with pertinent legal and practical considerations allows us to propose a range of alternatives for clients, based in part on the experiences of other health care clients, when selecting and effectuating a revised structure.
In addition to our experience in counseling clients as to the advisability of various approaches to restructuring, members of the Practice Area have implemented diverse plans of reorganization.
Health Care Financing
Practice Area Members work closely with the firm’s Corporate Finance Practice area in advising the firm’s health care clients on legal matters pertinent to credit needs. We have served as counsel in connection with numerous municipal bond financings, traditional bank loan and other debt transactions and, increasingly, equity venture capital transactions.
Home Health Care Organizations and Other Subacute Providers
The increasing reliance on home health care providers is driven by continuing concerns for health care costs and advances in medical technology and training. In addition, subacute providers are frequently sought as partners in the vertical integration of health care delivery systems. Our Health Law Practice Area has represented subacute providers in connection with general corporate issues, licensing, reimbursement, contracts with other providers, creation of infusion therapy subsidiaries and joint ventures. Frequently, difficult issues under fraud and abuse/antikickback rules must be addressed.
Provider Joint Ventures and Acquisitions
Members of the Practice Area have been involved in numerous joint venture projects among health care providers, and between health care providers and other parties. These health care joint ventures have involved hospitals and physicians syndicating professional buildings, the leasing of medical equipment, and the provision of ancillary services, ambulatory surgical treatment centers and home health care ventures. They also have included joint ventures between providers and commercial insurance entities to create managed care organizations, between provider associations and an actuarial firm to create managed care software and between a national provider network and a marketing company. In structuring joint ventures we incorporate our firm’s expertise in the corporate, tax and finance areas, with special focus, if applicable, on the implications of a joint venture on the tax-exempt status of the participating health care entity.
Legislative and Regulatory Matters
The Health Law Practice Area is very active in the highly specialized areas of legislative and regulatory practice and has assisted clients in formulating legislative and regulatory positions, including the development of legislative or regulatory comment and testimony before state and congressional entities.
Managed Care
Members of the Practice Area have represented Managed Care Organizations (MCOs) of every variety and size, including HMOs, insurance companies, preferred provider organizations ("PPOs"), and provider-sponsored or owned network organizations. Our broad experience in representing the diverse segments of the health care delivery field in connection with managed care issues enables the Practice Area to efficiently and creatively assist in the resolution of legal issues, development of appropriate structures, and maintenance of legal compliance.
Practice Area members have had significant extensive experience in structuring MCOs and in resolving the numerous issues surrounding the creation, implementation, and ongoing operation of these entities.
Medical Staff Bylaws and Credentialing
Attorneys in the Health Care Practice Area are experienced in drafting and revising medical staff bylaws, policies and procedures. The Practice Area has provided counsel in connection with a number of medical staff matters, including hospital-physician disputes regarding medical staff matters, managed care-related credentialing issues and disputes, and represented both institutions and physicians in due process hearings and civil litigation pertaining thereto. We have also assisted physicians forming independent practice associations ("IPAs") in developing an appropriate credentialing mechanism to minimize the IPA’s exposure from both a tort and an antitrust perspective. Members of the Practice Area are currently counseling a hospital in its endeavor to implement an interdisciplinary approach to internal quality control and peer review.
Medicare/Medicaid Programs
Attorneys in the Health Law Practice Area regularly counsel health care clients on the legal aspects of reimbursement under the Medicare and Medicaid programs. We have substantial experience in the area of fraud and abuse and counsel numerous clients in structuring business arrangements in a manner consistent with federal and state prohibitions on kickbacks and other fraud. We counsel hospitals, physician organizations, subacute providers, Federally Qualified Health Centers, Community Mental Health Centers and other providers regarding conditions of participation and reimbursement under these programs. We also maintain a national practice counseling provider-sponsored networks and MCOs, as well as federal, state and county governmental agencies, regarding development and implementation of Medicare/Medicaid managed care programs.
Occupational Health Law
The firm’s occupational health law practice involves representing clients nationwide in federal and state occupational safety and health proceedings, including citation actions, standard-setting, variance requests, criminal and contempt proceedings and related discrimination matters. As one of the leading law firms in the country in this practice area, the firm has played a major role in the development of the law under the Occupational Safety and Health Act. The firm’s practice also involves significant consulting in connection with the establishment of work force medical screening and employee training programs and the implementation of occupational health and safety policies that interface with other labor and employment laws such as policies relating to workplace reproductive hazards, drug and alcohol testing, communicable diseases, exclusionary rules and genetic testing of applicants and employees.
Physician Recruitment and Retention
In a changing health care industry, hospitals and other providers face increased financial pressures to maintain and enhance revenue streams. At the same time, hospitals and physicians are recognizing the mutual advantages that come from close affiliation. As a result, institutions continue to pursue and expand their recruitment and retention programs. These programs range from more traditional recruitment methods such as loans, income guarantees, office and equipment leases and practice management and marketing assistance to physician practice acquisitions, provider hospital organization ("PHO") development and other forms of vertical integration. These arrangements must be very carefully structured to reduce legal exposure under antitrust, antikickback and tax exemption and designed with sensitivity to restrictions emanating from securities laws, the corporate practice of medicine restrictions, ethical constraints on physicians and other legal and regulatory constraints.
Physicians & Physician Groups
Attorneys in the Practice Area have provided substantial representation to physician organizations in the areas of contracting, employment agreements, practice structuring, hospital relations, enforcement of restrictive covenants, and managed care. The firm’s Health Law attorneys have extensive experience in counseling group practice in a wide range of matters, including hospital medical staff relations, PHO relations, managed care contracting, possible corporate restructuring, labor matters and enforcement of restrictive covenants (including arbitration proceedings), as well as restructuring joint ventures among physicians in response to federal and state antireferral legislation.
Professional Membership Associations
Attorneys in the Practice Area and the firm have a long tradition of serving as general and special counsel to national, state and local associations of health care professionals and health care organizations. As general counsel, the firm is responsible for the client’s complete legal needs, including internal organizational and maintenance issues, as well as the many legal implications of an association’s interface with the health care industry and various governmental bodies. Health law attorneys regularly work with association clients in defining appropriate categories of membership, evaluating membership applicants and formulating disciplinary procedures to assess the continuing qualifications of members. The firm’s health law attorneys also advise association clients on the contractual and other legal implications of conducting education programs, which may include scientific exhibits, and publishing professional and scientific journals and newsletters.
The firm has successfully represented association clients in major litigation in the state and federal courts and before the Federal Trade Commission. The firm’s health law attorneys have acted as lead counsel in the industrywide investigation of the medical profession by the Federal Trade Commission. The firm has also represented association clients in major litigation challenging codes of ethics, standard setting and accreditation programs. Because professional membership associations are by definition combinations of competitors drawn together to further mutual goals, their activities frequently implicate the antitrust laws. The in-depth knowledge that the firm’s health law attorneys have of the health care industry and its legal environment enables them to effectively counsel and defend their clients in this sometimes hostile environment. Members of the Practice Area have, for example, counseled the firm’s professional association clients on how to go about developing statistical reporting programs, information exchange systems, and fee and price surveys.
Risk Management Issues
In the course of representing health providers, our attorneys have developed extensive experience in risk management techniques, including the review and development of internal provider processes to reduce exposure or improve control and reporting of incidents leading to unnecessary risk levels. In addition, we have assisted in the creation of structures and relationships with related and commercial insurers or risk-bearing entities to efficiently and effectively fund for unavoidable risk contingencies.
Standard Setting, Certification and Accreditation Programs
The Health Law Practice Area represents many clients who perform a unique and increasingly important role of setting standards for professional competence in the health care field. These clients include certifying boards, licensing agencies, accrediting bodies and various professional associations seeking to establish and enforce codes of ethics. In addition to its antitrust experience, the Practice Area has unusual capabilities in interpreting the law as it applies to the design and implementation of tests to measure competence.
The firm has assisted many clients in developing and implementing programs to evaluate health care provider competence and to accredit various operations within health care facilities. In addition, the firm frequently advises clients on conflict-of-interest policies and other means to avoid antitrust liability arising from competitor involvement in standard setting.
Tax Exemption
The Health Law Practice Area and other attorneys in the firm have an extensive background in addressing federal and state tax exemption issues for a wide range of health care entities. Our projects range from preparation of applications for federal tax-exempt status to resolution of private inurement and Unrelated Business Income Tax ("UBIT") concerns emanating from joint venture activities with nonexempt parties. Our federal tax capabilities are supplemented by the Practice Area’s ability to address state and local sales, use and property tax exemption issues on behalf of our health care clients. We are regularly called upon to apply for these exemptions and also to ensure that these exemptions are retained to the fullest allowable degree in the course of sales, leases and restructuring.
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