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Healthcare providers continue to rely on interconnected information technology systems and digital care delivery to improve healthcare outcomes.  In response, ransomware attacks are increasing, both in number and in sophistication.  The attacks threaten the clinical and clerical operations of healthcare enterprises of all sizes.  JAMA published an alarming study to show that the number of ransomware attacks targeting healthcare organizations doubled in the last five years.  These attacks disrupted care and exposed the personal health information of nearly 42 million patients.

Ransomware attacks usually involve the installation of malicious software on vulnerable systems and technology through any number of vulnerabilities, such as email phishing links or disguised as software updates.  Once installed, the ransomware software locks healthcare organizations out of their own data, whole data storage systems, or targeted technology devices.  The cybercriminals behind ransomware attacks then threaten to release, permanently encrypt, or delete patient data—in some cases, all three—unless the organization pays the ransom demand.
Continue Reading Ransomware Attacks at Record Levels; Healthcare Organizations Must Be Ready Via Data Security and Disaster Response Policies and Procedures

Featuring Epiphany Dermatology, WellMed Medical Management, & Allied OMS

In September, Winstead hosted a virtual event entitled “Physician Roll-Up Transactions.” The event, which was moderated by Winstead shareholder Justin Hoover, featured Torie Berkowitz, Corporate Counsel & Director of Legal Affairs at Epiphany Dermatology, Joanne Comer, Sr. VP, Corporate Development at WellMed Medical Management, and Daniel

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Webinar: Physician Roll-Up Transactions
Join Winstead for a webinar on physician roll-up transactions. During the webinar, guest speakers will discuss various strategies and structures for successfully effecting roll-up transactions, including how physician groups should prepare in advance of exploring a potential transaction in order to maximize their value. The panel will also discuss current trends,…

On Tuesday, December 15, Matthias Kleinsasser presented at the Austin Bar Association’s Health Law Section meeting. His presentation, titled “The Basics of the False Claims Act, STARK, and Anti-Kickback Statute and Recent Regulatory Developments,” provided a litigator’s perspective on the basics of the False Claims Act, STARK, and the Anti-Kickback Statute, along with a…

In the wake of the initial months of the COVID-19 pandemic, many practitioners have started to see a notable uptick in healthcare M&A activity through the third quarter of 2020.  Such activity spans from consolidation transactions in certain medical practice segments, accretive acquisitions in the hospice and home health space, business combinations to expand telemedicine offerings, and a growing interest in value-add healthcare real estate opportunities.  In most cases, the seller parties that have weathered the COVID-19 storm have done in so in part through the lifelines of funding provided by the U.S. Small Business Administration (SBA) through the CARES Act, and in particular Paycheck Protection Program (PPP) loans.  However, as the healthcare M&A deals initially inked in Q3-2020 now shift to closing mode in Q4-2020, these PPP loans are presenting new challenges for both sellers and buyers.  The following highlights some of the key issues.
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Continue Reading Healthcare M&A in a Post-PPP World: Time to Look that Gift Horse in the Mouth

In order to clarify the required procedures for changes of ownership of entities that have received Paycheck Protection Program (“PPP”) funds, the Small Business Administration (“SBA”), on October 2, 2020, released a Procedural Notice. Specifically, the Procedural Notice addresses the procedures companies with outstanding PPP loans must follow when undergoing a change of ownership, including mergers, equity or asset acquisitions, or ownership restructurings.[1]

Prior to the October 2, 2020 Procedural Notice, SBA loans typically required prior SBA approval for any transaction involving a change of ownership, regardless of the percentage change. Without further guidance from the SBA, PPP lenders have been cautious in granting their consent to their PPP borrowers’ change of ownership transactions without prior SBA approval in order to avoid potential defaults and forego forgiveness rights of the PPP loan.…

Continue Reading SBA Procedural Notice Summary – Changes of Ownership

It’s no secret that the Department of Justice has made the False Claims Act (“FCA”) a priority for years.  Last month, we discussed why regulatory changes in response to Covid-19 (e.g., STARK waivers) could provide additional bases for the government to bring FCA cases.  This post addresses the basics of cooperation credit for defendants who cooperate with the Department of Justice during an FCA investigation.
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Continue Reading Understanding the Basics of Cooperation Credit in False Claims Act Matters

Regulatory developments—such as the Stark Law blanket waivers and the OIG’s enforcement deferral for use of the waivers—have helped healthcare providers during the COVID-19 crisis, but healthcare fraud remains a prime target of the DOJ and the OIG (in addition to state regulators).  Between October 2018 and September 2019, the DOJ obtained over $3 billion in judgments and settlements from fraud claims, a substantial portion of those claims relating to healthcare fraud.[1]  The significant increase in qui tam litigation since the 1980s is also notable.[2]  So what fraud and abuse actions could regulators pursue in COVID-19’s shadow? …
Continue Reading Do Covid-19 Regulatory Changes Pose an Increased Risk of Fraud and Abuse Liability for Healthcare Providers?

It is common practice for a hospital to require a physician to sign a non-compete agreement whenever the hospital employs the physician or acquires the physician’s medical practice. In certain respects, that is to be expected. Non-compete agreements are a common feature in employment agreements and business acquisition documents across all industries and therefore it…