In a nutshell

Healthcare is a massive part of the US economy. It was estimated that in 2009 the healthcare sector made up 17.3 percent of GDP (by 2019 it will be almost 20). It is the largest single sector of the economy by number of employees.

Many major firms have healthcare practices and there are many niche or boutique health firms – many of them tied to specific states. Why is there a need for so many health lawyers? “The main difference with other sectors of the economy is the unique and intensive regulatory environment,” explains Doug Hastings, chair of EpsteinBeckerGreen and member of its healthcare and life sciences practice.

Health law practitioners provide regulatory advice on the implementation of (new) legislation, and advise healthcare companies in transactions, commercial litigation and government investigations.

After the passing of the Patient Protection and Affordable Care Act in March 2010, the nationwide demand for healthcare advice and representation has never been greater. Obama’s healthcare reform is a “potentially transformational law,” according to Doug Hastings. “This is the biggest thing since Medicare and Medicaid, and the industry is now 100 times bigger. It is not only important for the healthcare industry but for all major client sectors because all employers are affected.”

What healthcare lawyers do

Healthcare: transactional

• Healthcare lawyers are sometimes brought in as trouble-shooters at the same stage of a deal that tax and antitrust attorneys are brought in (see Corporate section). This is often the case for smaller BigLaw health practices and local healthcare boutiques.
• At other times healthcare lawyers will run a deal from soup to nuts. This happens when there are numerous health industry clients or statutes involved, so lawyers who understand the regulatory context of a deal need to be involved from the outset. This happens more often in larger BigLaw healthcare practices and boutiques, but is increasingly common given the complexity of new healthcare reforms.
• Healthcare transactional work involves “putting a deal together and doing the due diligence as normal, but is also infused with the additional variety of regulatory issues,” says Doug Hastings.

Healthcare: litigation

• Litigation work – especially in relation to government investigations – is “the high end of regulatory healthcare work for people who have been at it for a long time and are really good,” Hastings told us.
• Government-funded Medicare and Medicaid payments are a major source of litigation and government investigations. “There is a whole set of rules on how you can get paid as a healthcare provider for Medicare and Medicaid services,” Hastings explains. “Anyone that provides healthcare – hospitals, physicians, hospices, home care providers – will have some Medicare patients. Not only are there questions surrounding the eligibility and amount of payment, but providers might face anything from a routine government audit to an investigation into healthcare fraud.”
• Healthcare and life sciences practices see a lot of qui tam litigation – cases in which someone who assists with a government prosecution can receive all or part of the penalty imposed.

Healthcare: advice

• Outside the times when healthcare lawyers are called in for litigation and transactions, they are constantly providing regulatory advice. “All the way along practices like ours are giving companies advice,” Hastings explains. “Our clients have intensive compliance programs. If they have issues with that compliance we get brought in. We might then negotiate a settlement with the government.”
• Among the key pieces of legislation governing Medicare fraud and abuse are the antikickback law and the Stark Law. The latter governs physicians’ referral of patients to medical facilities in which that physician has a financial interest.
• Federal antitrust laws and Food & Drug Administration regulations also form an important component of health lawyers’ work.

Realities of the job

• “It is very rare for a healthcare deal to close the day of the agreement, because of the regulatory approvals,” Hastings tells us.
• “In other lines of business it’s perfectly normal for deals to be struck over the referral of work,” says Hastings. “In healthcare, if someone pays someone to refer business, that is fraud and is potentially criminally illegal.”
• You can read more about life sciences law – an area related to healthcare – in the sections on Product Liability and Intellectual Property.

Current issues

• The Obama healthcare reforms have brought sweeping changes to the country’s healthcare system. Among other things the new laws (1) expand those eligible for Medicaid; (2) regulate the premiums health insurance companies can charge; (3) provide subsidies for less wealthy individuals to pay for insurance; (4) increase the obligations on employees to provide health benefits; (5) bar insurers from dropping people from coverage when they get sick; (6) increase taxation on individuals with high incomes and on pharmaceutical and medical products.
• “In broad terms there are three coequal parts to the reforms,” Doug Hastings explains: “Expanding coverage to get more people insured; ways to bend the cost-curve and pay for all this; and improving the delivery system to produce better healthcare results. The latter – improving quality – is not controversial. The first two are controversial.” Republican attempts to amend the law may gain a foothold soon, but the reforms will not be greatly altered while Obama remains president.
• The marketing of prescription medication is a controversial issue. As a result of Obama’s healthcare reforms, greater scrutiny is being placed on the close links between pharma companies and physicians.
• Monitoring legislative changes is a major task for all healthcare and life sciences lawyers. Junior associates especially can be involved in writing up summaries of the implications of new legislation for various client sectors.

What top healthcare lawyers say

Doug Hastings, partner, firm chair and member of the healthcare and life sciences group, EpsteinBeckerGreen

“This is a very exciting and vibrant area to work in. Healthcare is both an economic commodity and a social good. You are working in an area which can really help make a difference to people’s lives.”

“Healthcare is an area that changes so quickly that as an associate there is more room to carve out your own unique expertise. Even a first, second or third-year may well see a new trend and be able to act on it.”

“Many of the associates I work with have come from some sort of background related to the field: they ran hospitals, were policy advisers or worked as doctors, pharmacists or chemists.”