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Acquisition in healthcare: Watch out for these federal regulations

One business buying another to further its operations or reach is not a new concept, but the laws and regulations that surround these transactions are constantly changing. In a recent example, a medical staffing firm out of Texas finalized its acquisition of a virtual care platform.

The move allows the firm to expand within home healthcare by being able to add the ability to offer remote patient monitoring services. With this acquisition, the firm could also provide virtual visits and allow providers the ability to reach out to patients through text and email services. Although beneficial for healthcare, these types of services can run afoul of federal regulations. Specific regulations to carefully review and plan for include HIPAA and the Anti-Kickback Statute.

HIPAA.

Technologies like remote communications and telehealth services may fall within the rules of the Health Insurance Portability and Accountability Act (HIPAA). Although the Office for Civil Rights (OCR) at the Department of Health and Human Services (HHS), the federal agency responsible for enforcing HIPAA rules, stated it would not enforce penalties for noncompliance during the pandemic when the healthcare provider could show a good faith effort this grace will not extend indefinitely. As such, it is important to review practices and adjust better ensure compliance.

Stark law and Anti-Kickback Statute.

These two laws essentially make it illegal to receive kickbacks or remuneration in exchange for patient referrals. Those running home health agencies will need to be careful in its relationships and dealings with other medical practices when growing its services.

A violation of either of these or other applicable regulations is serious. Depending on the details, the accused could face steep fines and potential imprisonment.