Health care companies using algorithms and AI applications face increased compliance risks. Previous technology-related enforcement suggests how relators and enforcement agencies might use AI to detect potential fraud and develop allegations based on how the technology is being used.

California’s new Office of Health Care Affordability (OHCA) is set to begin advance regulatory review of certain health care transactions beginning January 1, 2024. As further explained in our previous post, subject to certain exceptions, a broad range of health care entities (collectively, Health Care Entities) will soon be subject to potential prospective transaction review. OHCA initially published proposed regulations for the new transaction review process in early August (for more details, see our prior post and podcast).  As further discussed in our previous post, these proposed regulations were revised in October and made available on the OHCA website, with a comment period that ended on October 17, 2023. In response to October’s public comments, OHCA has further revised the proposed regulations (Revised Regulations), which are available here. This time however, OHCA has also provided notice of proposed emergency regulatory action, indicating that this version of the regulations will be submitted to the California Office of Administrative Law (OAL) for approval. Once submitted, the public will have five days to provide comments to the OAL. If the OAL approves the regulations, it will file them with the California Secretary of State and the regulations will become effective as emergency regulations for five years as of the filing date. During this period, OHCA will proceed with regular rulemaking action addressing prospective health care transaction review.

California’s new Office of Health Care Affordability (OHCA) is set to begin advance regulatory review of certain health care transactions beginning January 1, 2024. As further explained in our previous post, subject to certain exceptions, third party payers and administrators, hospitals, hospital systems, fully integrated delivery systems, pharmacy benefit managers, physician organizations, and other providers (collectively, Health Care Entities) will soon be subject to potential prospective transaction review. OHCA initially published proposed regulations for the new transaction review process in early August (for more details, see our prior post and our podcast). Multiple stakeholders expressed concerns with the proposed regulations during the public comment period, which ended August 31, 2023. In response to these comments, OHCA has published revised proposed regulations (Revised Regulations) allowing for an abbreviated comment period that ends October 17, 2023. The Revised Regulations are available here.

Governor Gavin Newsom recently signed multiple bills into law as part of California’s ongoing efforts to safeguard access to reproductive and gender affirming health care. The new laws are intended to increase protections for health care providers and patients, increase health care provider availability, and improve patient privacy. In a recent press release, California Legislative Women’s Caucus Vice Chair Assemblymember Cecilia Aguiar-Curry noted: “Last year, we enacted 14 bills and budget funding to expand and protect reproductive rights and services in our state. This year, we build on that momentum with legislation that ensures California remains a national leader in the fight for reproductive justice.”

Many health care entities with assets or operations in California will face advance regulatory review of transactions by the state’s new Office of Health Care Affordability early next year. Mintz Members Lara Compton, Daniel Cody, and Kathryn Edgerton discuss the emergency rulemaking process, proposed regulations requiring pre-closing notice of deals, and key considerations for health organizations.