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What hospitals need to do to prepare and respond to the COVID-19 outbreak

By Delphine O’Rourke, Esq. / Special to Healthcare Facilities Today
March 23, 2020

The United States is in a state of national emergency with no immediate end in sight.  On Friday, March 13, President Trump declared a COVID-19 national emergency under the Stafford Act, a step that will dramatically change hospital and health systems’ ability to respond to the COVID-19 epidemic. 

In addition to the estimated $50 billion in federal disaster relief funding, the declaration provides the Secretary of the U.S. Department of Health and Human Services (HHS), Alex Azar, with more authority to waive some Medicare, Medicaid and Children’s Health Insurance Program (CHIP) requirements. These waivers are critical for U.S. hospitals in their rapid efforts to prepare and, for many, respond in order to care for patients and protect their employees. The most important relief includes:

  • enabling telehealth services for remote doctor visits and hospital check-ins to increase access to care;
  • waiving certain federal licensing requirements to allow out of state physicians to provide services without additional licensing and waiting times;
  • waiving requirements that critical-access hospitals can only have 25 inpatient beds and keep inpatients for only 96 hours;
  • waiving a requirement that a patient must have been in the hospital for three days before that patient can be transferred to a nursing home;
  • allowing hospitals to contract with additional physicians; 
  • allowing hospitals to obtain additional office space; and
  • ensuring that hospitals’ capacity to care for emergency patients in enhanced by waiving rules that severely restrict a hospital’s ability to provide care of patients within the hospital facility proper.

On January 31, 2020, Health and Human Services (HHS) Secretary Alex Azar declared a public health emergency (PHE) for the U.S. to aid the health care community in responding to the Coronavirus (2019-nCoV) retroactive to January 27, 2020. As part of a coordinated U.S. public health response amid growing fears, Secretary Azar attempted to provide reassurance, stating that "[w]hile this virus poses a serious public health threat, the risk to the American public remains low at this time, and we are working to keep this risk low."   

Secretary Azar’s announcement came the day after the World Health Organization declared a world health emergency as the confirmed Coronavirus cases passed 10,000 and spread outside of China.  To date, and despite President Trump’s declaration last Friday regarding public-partnerships to develop a vaccine on an expedited basis, there are no vaccines to protect against the rapid spread of the Coronavirus. 

While the disease itself may still not be entirely understood, what is clear from the spike in U.S. cases and daily reports of medical personnel exposure, is that hospital preparedness is critical to avoid a disaster. It is therefore not surprising that the CDC declared that “[a]ll U.S. hospitals should be prepared for the possible arrival of patients with Coronavirus Disease 2019 (COVID-19)” over six weeks ago.

Unlike an emergency that affects a community and its health care providers without warning and prior knowledge, U.S. hospitals had the advantage of time - while limited – and increasing knowledge of the specific attributes of this potential pandemic. Therefore, public expectations of our hospitals’ preparedness and response for a Coronavirus outbreak is higher and delays in response will create unnecessary risks to patients, providers and the public. As recent history of U.S. disasters has taught us, the public holds hospitals to very high standards and is unforgiving of a lack of preparedness. 

Potential unmitigated legal risks include, but are not limited to, violations of federal and state regulatory requirements, contract law claims, fraud and abuse exposure under the Stark Law and Anti-kickback Statute, patient privacy and protected health information violations, criminal liability, professional malpractice lability, cyberattacks and insurance disputes. Months and even years after an emergency is over and day-to-day operations have gone back to normal, hospital counsel will be handling the legal implications of the emergency.   

U.S. hospitals are already subject to Federal, State and local emergency preparedness requirements.  HHS has also established several preparedness initiatives. The Hospital Preparedness Program, for example, promotes sustained national focus on emergency preparedness to improve patient outcomes, minimize the need for supplemental Federal and state resources during emergencies and enable rapid recovery. The program is one of the only sources of funding for health care delivery system readiness.

While participation in the Hospital Preparedness Program is voluntary, compliance with CMS’ Emergency Preparedness Rule (EP Rule) is mandatory.  The EP Rule’s requirements are Medicare Conditions of Participation, Conditions for Coverage and Conditions for Certification that covered facilities – including most hospitals – must meet.  

Since the EP Rule went into effect on November 16, 2016, hospitals have been required to review their emergency preparedness plan and update it at least annually. Hospitals are surveyed for compliance in conjunction with the existing survey process for health and safety compliance surveys or Life Safety Code (LSC) surveys.  The Joint Commission certifies that the hospital’s plan follows an all hazards approach which is an “[i]ntegrated approach to emergency preparedness that focuses on identifying hazards and developing emergency preparedness capacities and capabilities that can address those as well as a wide spectrum of emergencies or disasters.” 

The coronavirus pandemic falls squarely within the all hazards approach to emergency preparedness.  And any integrated approach should include legal preparedness. While the CMS requirements touch on legal issues, they do not reflect the comprehensive review of potential risks necessary in advance of a widespread outbreak.    

The checklist below is a starting point for hospitals continuing to prepare, respond and recover from the Coronavirus pandemic in close coordination with each facility’s legal team: U.S. hospitals, physicians and medical personnel are our first line of defense and they deserve short term and long term strategic thinking that will ensure their safety and that of our communities.

Rapid Legal Preparation Checklist

Communications

  • Media strategy for community, patients, traditional and media outlets
  • Prepared statements
  • Protecting Patient Health Information in communications 
  • All communications should be reviewed by legal counsel before the emergency!

Privacy 

  • Ensure that PHI is only disclosed to lawful recipients in order to advance public health activities connected to Coronavirus outbreak 
  • Ensure that shared PHI is only sent securely (i.e., encryption)
  • Determine whether disclosure of PHI is necessary for treatment of a sick patient or other patients (e.g., coordinating or managing services between providers, consultation between providers, and referral of patients for treatment)
  • Check health care proxies for written direction from patient to identify individuals with whom PHI may be shared beyond family members, relatives, and friends
  • Put protections in place to prevent access by employees tempted to access records for patients being treated for high profile diseases
  • Consider monitoring who is accessing records
  • Use of a “break the glass” feature if included in EHR system to prevent unauthorized access
  • Remind employees of policies surrounding access to patient records

Key Supplies and Services

  • Emergency response team to identify all key supplies and services that will be critical in the event of a Coronavirus outbreak
  • Inventory that you have contracts in place for all key supplies and services 
  • Immediately address any contractual gaps identified
  • Assemble/draft templates for services that you may need i.e. cots for families, transfer agreements, coalition agreements, limited services agreements with physicians, etc.
  • Due diligence your contracts for terms that will be critical during a Coronavirus outbreak

Provider Issues: Physicians and Allied Professionals

  • Contracts
  • Employed physicians – language regarding emergency services Independent contractors – emergency services
  • No contracts – template agreements
  • Standard call coverage agreement to cover emergency and short notice coverage
  • Fraud and abuse relief – Social Security Act §1135 Waiver 
  • Insurance
  • Scope of professional liability insurance 
  • Policy provisions for emergencies 
  • Process to add providers
  • Other, as applicable
  • Credentialing
  • Medical Staff Bylaws regarding scope of credentialing for physicians who are already credentialed – emergency provisions
  • Contracts 
  • Documentation 
  • Reimbursement

Due Diligence Checklist for Critical Contract Terms

  • Emergency specific language 
  • Flow though requirements 
  • Force majeure
  • Standard (impractical, impossible, illegal)
  • Business continuity or contingency plans (show facility) 
  • Exculpatory Clauses
  • Non-exclusivity 
  • Surge requirements 
  • Length of emergency 
  • Indemnification 
  • Notice
  • Scope: is a Coronavirus outbreak covered by language regarding Acts of God, specifically listed events, catch all phrases, excluded events or anticipated events?
  • Which party bears the risk of a Coronavirus outbreak? 
  • Consequences of the force majeure event?
  • Flow through requirements? 
  • Liquidated damages?
  • Continued payment?
  • Other related documents/contracts? 
  • Termination for extended force majeure?

Negotiate the Gaps

  • Negotiate new contracts – either for execution or for preparedness 
  • Templates for emergency supplies and services
  • Amendments that can be broadly applied
  • Call coverage agreements and short notice coverage 
  • Temporary agreements
  • Draft notice to insurance carriers Draft notice to vendors
  • In force during emergency preparedness plan duration
  • Templates for emergency supplies and services
  • Amendments that can be broadly applied
  • Call coverage agreements and short notice coverage 
  • Temporary agreements
  • Draft notice to insurance carriers 
  • Draft notice to vendors
  • Draft notice to suppliers 
  • Standing work orders 
  • Transfer agreements
  • Telemedicine services agreements 
  • Other, as applicable

Delphine O'Rourke is a partner at Duane Morris who has worked as in-house general counsel and advises on advocacy strategy for hospitals in the nation’s largest non-profit health system and the world’s largest Catholic health system

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