Health Care Law Blog

2015 Michigan Health Law Update

On March 12, 2015 Foster Swift Attorney Jennifer Van Regenmorter co-presented the Michigan Health Law Update (“Annual Update”) at the 21^st Annual Health Law Institute. The Annual Update provides an overview of the most significant Michigan-specific health law developments from the past year, many of which have been covered on this blog. This article will summarize the highlights from this year’s Annual Update.

Blue Cross Blue Shield of Michigan:

• Hi-Lex Controls, Inc. v. Blue Cross Blue Shield of Michigan - The Sixth Circuit held that Blue Cross Blue Shield of Michigan (“BCBSM”) breached its fiduciary duties when it added hidden administrative fees that were neither disclosed nor agreed upon by the parties. The court entered judgment in favor of Hi-Lex for $5.1 million, including a return of all hidden fees since 1994 plus interest. Several similar cases against BCBSM are pending in the Eastern District of Michigan.

Business/Corporate:

• Amendments to the Nonprofit Corporations Act (2014 P.A. 557-559) – These amendments prohibit a nonprofit corporation or other entity organized for charitable purposes from merging, converting, or dissolving without the consent of the Attorney General, and establish procedures for securing the Attorney General's consent. The amendments also authorize the merger of a domestic limited liability company (“LLC”) with a nonprofit corporation.

Health Facilities:

• Continuing Care Community Disclosure Act (2014 P.A. 448-450) – This Act repeals and replaces the Living Care Disclosure Act to create an umbrella organization, the continuing care community (“CCC”), that would be responsible for certain long-term care facilities and services.

Insurance:

• Medical Retainer Agreements (2014 P.A. 522) – This Act amends the Insurance Code (“Code”) to specify that a medical retainer agreement is not insurance and would not be subject to the Code. The Act defines “medical retainer agreement” as a contract between a health care provider and an individual patient or his or her legal representative in which the health care provider agrees to provide routine health care services to the individual patient for an agreed-upon fee and period of time.

Licensure:

• Changes to Licensing Investigations and Disciplinary Procedures (2014 P.A. 95-98) – These new rules require LARA to investigate an allegation that there are grounds for action against a health professional by a disciplinary subcommittee, unless the allegation is made more than 4 years after the alleged incident. LARA previously had discretion as to which allegations it would investigate. These new rules also prohibit a board’s chair or members from participating in investigative or disciplinary decisions if there is a conflict of interest, permit LARA to review a final decision of a disciplinary subcommittee, and require a minimum $25,000 fine if a patient death results from certain violations. (Click here for our newsletter article on these new rules.)

Medicaid:

• MI Health Link – The new MI Health Link is a CMS-MDCH demonstration program that integrates Medicare and Medicaid benefits, rules, and payments into a single coordinated delivery system. The program offers a broad range of services through new managed care entities called Integrated Care Organizations (“ICOs”) and Medicaid’s existing Pre-paid Inpatient Health Plans (“PIHPs”). The program will be introduced in two phases in the Upper Peninsula, Southwest Michigan, Macomb County, and Wayne County.

Medical Marihuana:

• Braska v. Challenge Mfg. Co. – The Michigan Court of Appeals held that employees who were issued medical marihuana registration cards under the Michigan Medical Marihuana Act (“MMMA”) were entitled to unemployment benefits after being fired for failing to pass drug tests.

Medical Records/Confidentiality:

• Jane Doe v. Henry Ford – The Michigan Court of Appeals decertified a class action suit against Henry Ford Health System (“HFHS”) and its subcontractor, a medical transcription service, for inadvertently disclosing sensitive patient information online. The court ruled that (1) an invasion of privacy claim requires an intentional act rather than mere negligence; (2) the plaintiff’s claims for negligence and breach of contract require proof of an actual injury; and (3) costs for credit monitoring were merely incurred in “anticipation of possible future injury” rather than an actual, present injury. (Click here for our blog post on this case.)

No-Fault:

• Wyoming Chiropractic v. Auto-Owners – The Michigan Court of Appeals held that a healthcare provider has standing to sue an insurer for personal injury protection (“PIP”) benefits under the Michigan No-Fault Act.

Peer Review:

• Harrison v. Munson Healthcare, Inc., et al. & Krusac v. Covenant Medical Center, Inc. – In both cases, the court held that the peer review protections do not apply to objective facts gathered contemporaneously with an event. Both cases are now pending before the Michigan Supreme Court. Oral Arguments were held on January 13, 2015.

Pharmaceuticals:

• Right to Try Act (2014 P.A. 345) – This Actallows eligible patients to try experimental drugs and other treatments before they have been approved by the Food and Drug Administration (“FDA”). The Act also provides that manufacturers, medical professionals, and health care facilities are protected from liability for harm caused by the drugs. (Click here for our blog post on this new law.)

Public Health:

• Infant Safe Sleep Act (2014 P.A. 122) – This Act requires hospitals to provide parents with educational materials regarding infant safe sleep practices. Compliant hospitals and health professionals are not criminally or civilly liable for parents’ action or inaction with regard to safe sleep practice materials.
• Sexual Assault Statutes (2014 P.A. 318-320) – These Acts require health care personnel to inform victims of the availability of medical forensic examinations.

Taxation:

• 2014 P.A. 161-162 – These Acts reinstate the Use Tax, reduce the Health Insurance Claims Assessment, and retain the original system of proportional credits.

Please contact a member of the Health Care Law Group if you have any questions regarding these topics and how they could impact your health care business.

Categories: Hospitals, Insurance, Licensing, Medicare/Medicaid, News & Events, Privacy