What a year in health care! It would take a legal treatise to summarize all health law regulatory and legal events that occurred in 2007. That being said, the following highlights are important to note:

1) Diagnostic Testing Facilities. The year started with an announcement prohibiting diagnostic testing facilities from sharing their facilities with third parties. Soon after, the Centers for Medicare & Medicaid Services (“CMS”) retracted the rule. But, in November the rule is back: effective January 1, 2008 (with a one year grace period for current centers).

2) Stark II, Phase III. CMS published Phase III Final Regulations. For medical groups’ contracting with independent contractors, new rules require that they “join in” the primary contract. Changes were also announced to productivity bonuses and profit sharing rules. New compensation “set in advance” rules preclude parties from amending rental charges and compensation terms during the agreement. Time share leases (shared ancillary models) without exclusive use will no longer meet the lease exception. Anti-markup rules have been amended, requiring that certain diagnostic tests be performed in the physician’s primary medical office to avoid certain restrictions. Most worrisome, CMS recently hinted that it is considering limiting certain self-referral procedures by specialty in the future. The days of internal medicine physicians performing echoes may be short-lived.

3) Florida’s Motor Vehicle No-Fault Law (PIP Coverage) Reinstated. The PIP statutory scheme will be reborn effective January 1, 2008. The old PIP statute sunsetted October 1, 2007. Under the new law, reimbursement for medical service provided will be as follows: Emergency transportation, 200% of Medicare; hospital services, 75% of usual and customary charges; physician emergency services, usual and customary charges; hospital (other than emergency) 200% of Medicare Part A; and all other medical services, 200% applicable Medicare Part B.

4) HIPAA. The courts ruled that there is no private party cause of action under HIPAA.

5) Privileges. The Florida Supreme Court allows a malpractice plaintiff to discover lists of medical staff privileges granted to a physician by a hospital.

6) Other. We experienced a flurry of medical group mergers, acquisitions, consolidations and breakups. We predict that this trend will likely continue in 2008 as medical groups need to respond to regulatory pressures and declining reimbursements.

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