Health Law & Managed Care

McDermott+ Check-Up: May 16, 2025

THIS WEEK’S DOSE

Key House Health Committees Advance Reconciliation, Bill Held Up in Budget Committee. The Energy and Commerce Committee and Ways and Means Committee passed their recommendations for reconciliation out of committee, but the Budget Committee failed to advance the bill today and is currently scheduled to reconvene at 10pm on Sunday, May 18, 2025.
HHS Secretary Kennedy Testifies in Congress. The House Appropriations Committee and Senate Health, Education, Labor, and Pensions (HELP) Committee held hearings on the US Department of Health and Human Services (HHS) budget.
Senate Judiciary Committee Discusses PBM Reform. Committee members widely agreed on the need for pharmacy benefit manager (PBM) policy change.
House Judiciary Subcommittee on Administrative State, Regulatory Reform, and Antitrust Holds Hearing on Medical Residency. The hearing examined the structure and legal implications of the National Resident Matching Program and evaluated its antitrust exemption.
Senate Finance Committee Advances Trump HHS Nominees. The nominations for deputy secretary of HHS and assistant secretary of legislation of HHS now move to the Senate floor.
Trump Signs EO on Drug Prices. The executive order (EO) seeks to implement most-favored nation pricing.
CMS Releases Proposed Rule on MCO Taxes. The Centers for Medicare & Medicaid Services (CMS) proposal would address state-imposed “provider taxes” on managed care organizations (MCOs).
HHS Agencies Issue RFIs. The requests for information (RFI) focus on possible deregulatory actions and the health technology ecosystem.
HHS Identifies Documents for Recission. The recission was enacted upon publication.
CMS Innovation Center Releases Strategic Framework. The strategy outlines how the center intends to structure current and future value-based care models.

CONGRESS

Key House Health Committees Advance Reconciliation, Bill Held Up in Budget Committee. On May 13, 2025, and into the next afternoon, the House Energy and Commerce Committee held a 26.5 hour markup of its budget reconciliation committee print, which included sweeping policy changes to Medicaid enrollment process, eligibility, and financing, as well as a Medicare physician payment adjustment, PBM reform, and changes to the Medicare prescription drug negotiation program and the Affordable Care Act (ACA). At the same time, the House Ways and Means Committee held a 15.5 hour markup of its budget reconciliation committee print. The Ways and Means package included provisions related to paid leave, CHOICE health plans (now called ICHRAs), health savings accounts, and research, as well as significant changes to ACA Exchange enrollment. Both committees successfully advanced their committee prints along party lines and did not adopt any amendments.
Energy and Commerce Committee: The House budget resolution instructed the House Energy and Commerce committee to find a minimum of $880 billion in savings. On May 11, 2025, Democrats released a memo from the Congressional Budget Office (CBO) estimating that the Energy and Commerce reconciliation recommendations related to Medicaid, the expiration of expanded premium tax credits, finalizing the 2025 Marketplace Integrity and Affordability Proposed Rule, and the Marketplace provisions that extend beyond codifying the proposed rule would increase the number of people without health insurance by at least 13.7 million by 2034. CBO noted on May 12, 2025, that the budget reconciliation text would exceed the savings target and reduce deficits by more than $880 billion over 10 years. On May 13, 2025, CBO released a new set of preliminary scores for certain Medicaid provisions listed in the bill, which in total would save $625 billion over 10 years. The scores also estimate that a total of 7.6 million individuals would become uninsured by 2034, including 1.4 million people without verified citizenship, nationality, or satisfactory immigration status. These are the figures congressional Republicans have cited. CBO has not yet provided final scoring for the package, and particular provisions are still without a score as well. That analysis is expected in the coming days.
During the Energy and Commerce Committee the markup, Democrats offered 246 health-related amendments, many of which were ultimately withdrawn. They largely focused on extending the enhanced advanced premium tax credits (APTCs), preventing the Medicaid policies that would reduce coverage from going into effect, addressing prescription drug prices, and preserving access to home- and community-based services. Republicans did not offer any amendments. The amendments can be found here, and the committee’s section-by-section summary can be found here.
Ways and Means Committee: The budget resolution instructed the House Ways and Means Committee to produce policies that would not raise the federal deficit by more than $4 trillion if the spending cuts in the overall bill totaled less than $1.5 trillion, or by more than $4.5 trillion if the bill achieved $2 trillion in savings. The Joint Committee on Taxation found that the Ways and Means Committee’s proposed tax provisions would increase the deficit by $3.18 trillion, meeting the goals stated in the resolution.
Throughout the markup, Democrats spoke out against the Medicaid provisions being considered in the House Energy and Commerce Committee and encouraged the Ways and Means Committee to extend the enhanced APTCs. Democrats argued that if the bill was supposed to help working Americans, healthcare improvements needed to be a key part of the legislation and tax breaks for the wealthy shouldn’t be financed by taking healthcare away from lower- and middle-class working Americans. Republicans offered no amendments. Their talking points focused on how the tax package was designed to limit tax liability of working Americans and restrict provision of government benefits to US citizens only, not individuals in the country illegally.
Budget Committee: Speaker Johnson (R-LA) aims to pass the reconciliation package on the House floor before Memorial Day. Once all the committees of jurisdiction have completed their work, the House Budget Committee is tasked with pasting together the various committee prints into a single reconciliation package. That is largely a perfunctory role as they have no authority to make any changes. The Budget Committee met today, May 16, 2025, to do that work. Ultimately, a vote was held to decide if the committee should vote on the package, which failed in a 16–21 vote due to a hardline conservative push to enact larger spending cuts. When voting no, Reps. Clyde (R- GA), Roy (R-TX), Brecheen (R-OK), and Norman (R-SC) cited concerns that the federal spending reductions, particularly the Medicaid cuts, do not go far enough. Rep. Smucker (R-PA) also voted no, clarifying that the no vote was so that the committee could procedurally bring the bill back up later. Specifically, conservatives are unhappy about the Medicaid work requirement provisions. As written, the work requirements do not begin until 2029, and conservatives want to shorten that timeline.
The Budget Committee is currently scheduled to reconvene at 10pm on Sunday, May 18, 2025, to vote on the bill, and the Rules Committee is expected to meet on Wednesday, May 21, 2025, to prepare the bill for floor debate. Republican leadership continues to work behind the scenes to resolve remaining differences related to Medicaid and other issues, such as disagreement on the state and local tax deduction (SALT).
HHS Secretary Kennedy Testifies in Congress. In the House Appropriations Committee hearing, Kennedy defended the cuts outlined in President Trump’s skinny budget request and heard concerns from both Republicans and Democrats about some of his policies, such as removing fluoride from drinking water. In the Senate HELP Committee hearing, Kennedy faced questions from a bipartisan group of senators about his previous statements on vaccine safety and efficacy. In both committees, Kennedy defended workforce and program cuts from the Department of Government Efficiency.
Senate Judiciary Committee Discusses PBM Reform. The hearing examined the role of PBMs and how current practices impact drug pricing, access to medication, and local pharmacies. Republican and Democratic senators expressed concerns over low reimbursement rates to local pharmacies, lack of transparency, and the impact of vertical integration on drug affordability. Several witnesses emphasized the need to reform PBMs and recommended that future policies prioritize patients over profit.
House Judiciary Subcommittee on Administrative State, Regulatory Reform, and Antitrust Holds Hearing on Medical Residency. The hearing examined the structure and legal implications of the National Resident Matching Program and evaluated its antitrust exemption. The hearing also explored the role of the Accreditation Council for Graduate Medical Education (ACGME) in shaping residency program standards and access, and how the residency placement and accreditation system affects medical graduates and the broader physician labor market. Republicans portrayed the matching program and ACGME accreditation as monopolistic, opaque, hospital-centric, and contributing to physician shortages, wage suppression, and lack of resident autonomy. Democrats defended the matching program as an imperfect but functional solution to manage medical residency placements. They emphasized the need for increased public investment, particularly in expanding residency slots, supporting international medical graduates, and protecting research funding.
Senate Finance Committee Advances Trump HHS Nominees. The executive session considered the nominations of James O’Neill to be deputy secretary of HHS and Gary Andres to be assistant secretary of legislation of HHS. Both nominees advanced (see vote outcomes below), and their nominations will now move to the Senate floor.

James O’Neill’s nomination to be deputy secretary of HHS advanced by a vote of 14 – 13, along party lines.
Gary Andres’ nomination to be assistant secretary of legislation of HHS advanced by a vote of 19 – 8. Sens. Warner (D-VA), Whitehouse (D-RI), Hassan (D-NH), Warnock (D-GA), and Welch (D-VT) joined Republicans in voting yes.

ADMINISTRATION

Trump Signs EO on Drug Prices. President Trump’s “most-favored nation” EO seeks to equalize drug prices between the United States and other developed countries. It instructs federal agencies to take the following actions:

The US trade representative and the secretary of commerce will ensure foreign countries are not engaged in practices that lead to high drug prices in the United States.
The HHS secretary will facilitate direct-to-consumer purchasing programs for drug manufacturers that sell their products to US consumers at the most-favored nation price.
The HHS secretary, in coordination with other relevant agencies, will have 30 days to bring prices for pharmaceutical drugs in the United States in line with comparable developed nations. If significant progress toward most-favored nation pricing is not delivered at that time, HHS in conjunction with CMS must develop rulemaking to impose most-favored-nation pricing.
HHS and the US Food and Drug Administration (FDA) must consider certifying that the importation of certain prescription drugs from other developed countries is safe, and if such certification is made, FDA must create a waiver process to allow for the importation of prescription drugs.
Several federal agencies, including the Federal Trade Commission, the Office of the Attorney General, and the US Department of Commerce, are instructed to investigate any anticompetitive practices leading to higher prices.
FDA is instructed to review and potentially modify or revoke approvals granted for drugs that maybe be unsafe, ineffective, or improperly marketed.

A fact sheet can be found here. While EOs typically lay out the administration’s policy priorities, effectuating such policies requires additional actions, including potential rulemakings.
CMS Releases Proposed Rule on MCO Taxes. Federal law requires state-imposed “provider taxes,” which include MCO taxes, to be uniform and broad based, meaning it must be applied at the same level and to all MCOs in the state, not just Medicaid MCOs. However, a state can apply to CMS for a waiver from this requirement if the net impact of the tax is generally redistributive and the amount of the tax is not directly correlated to Medicaid payments. With its proposal, CMS aims to close what it considers a loophole to prohibit states from taxing Medicaid MCOs at a higher rate than non-Medicaid MCOs. CMS identified eight taxes in seven states that would be affected by this proposal, if finalized. We understand those states to be California, Illinois, Massachusetts, Michigan, New York, Ohio, and West Virginia.
Key proposals include:

Prohibiting states from explicitly taxing Medicaid units at higher tax rates than units of other payors and better implementing the mandate that a tax be generally redistributive.
Defining terms used in the regulation, including “Medicaid taxable unit” and “non-Medicaid taxable unit” to prohibit states from using overly vague language.
Specifying that noncompliant states that received their most recent waiver approval within two years of the effective date of the final rule would not be eligible for a transition period. Noncompliant states that received waiver approval more than two years prior to the effective date of the final rule would have a transition period of at least one full state fiscal year to adjust the tax to come into compliance.

Read the press release here and the fact sheet here. Comments are due on July 14, 2025.
The House reconciliation bill reported by the Energy and Commerce Committee includes a similar but not identical provision.
HHS Agencies Issue RFIs.

In conjunction with FDA, HHS asked the public to help identify any opportunities to produce cost savings, increase efficiency, and catalyze health and economic innovation through deregulation, with the goal of addressing regulations that are “unnecessary, inconsistent with the law, overly burdensome, outdated, out of alignment with current EOs, or otherwise unsound.” Read the press release here. Comments are due on July 14, 2025.
CMS and the Assistant Secretary for Technology Policy/Office of the National Coordinator for Health IT requested input from the public regarding the digital health products market for Medicare beneficiaries, as well as the current state of data interoperability and the broader health technology infrastructure. Responses may be used to further efforts to cultivate this market, increase beneficiary access to effective digital capabilities, and increase data availability. Read the press release here. Comments are due on June 15, 2025.

HHS Identifies Documents for Recission. In a final rule, HHS rescinded the following four documents, effective immediately:

“Extension of Designation of Scarce Materials or Threatened Materials Subject to COVID-19 Hoarding Prevention Measures; Extension of Effective Date with Modifications” (86 FR 35810, July 7, 2021), which designated health and medical resources in scare supply and necessary to respond to the spread of COVID-19.
“Opioid Drugs in Maintenance and Detoxification Treatment of Opiate Addiction; Repeal of Current Regulations and Issuance of New Regulations: Delay of Effective Date and Resultant Amendments to the Final Rule” (66 FR 15347, March 19, 2001).
“Practice Guidelines for the Administration of Buprenorphine for Treating Opioid Use Disorder” (86 FR 22439, April 28, 2021), which provided eligible physicians, physician assistants, nurse practitioners, clinical nurse specialists, certified registered nurse anesthetists, and certified nurse midwives, who are state-licensed and registered by the DEA to prescribe controlled substances, an exemption from certain statutory certification requirements related to training, counseling, and other ancillary services.
“Notification of Interpretation and Enforcement of Section 1557 of the Affordable Care Act and Title IX of the Education Amendments of 1972” (86 FR 27984, May 25, 2021), which clarified that ACA Section 1557’s prohibition on discrimination included discrimination based on sexual orientation and gender identity.

CMS Innovation Center Releases Strategic Framework. The strategy outlines how the Innovation Center intends to structure current and future value-based care models, with an emphasis on prevention, individual engagement, and market-based mechanisms. The framework highlights the center’s plans related to:

Promoting evidence-based prevention.
Increasing model activity in Medicare Advantage, Medicaid, and prescription drug pricing.
Focusing on cost savings and financial accountability.
Expanding access to consumer-facing tools and data.
Increasing the role of independent and rural providers.
Emphasizing choice and competition.

QUICK HITS

CMS Releases Draft Guidance for Third Medicare Drug Price Negotiation Cycle. The guidance seeks to improve program transparency, further prioritize selection of prescription drugs with high costs to Medicare, and minimize any negative impacts of the negotiated maximum fair price on pharmaceutical innovation. Read the press release here and the fact sheet here. Comments are due on June 26, 2025.
FDA Begins Process of Removing Ingestible Fluoride Prescription Drug Products for Children. The agency has set a goal date of October 31, 2025, for completing a safety review and public comment period.
GAO Releases Reports on Caregiving, TRICARE. The first US Government Accountability Office (GAO) report recommends that HHS clarify when youth may qualify for support services. The second report provides information on the US Department of Defense’s processing of TRICARE claims from behavioral health providers.

NEXT WEEK’S DIAGNOSIS

Both chambers will be in session next week, as the House works to pass its budget reconciliation package before the Memorial Day recess. Budget hearings will continue, with HHS Secretary Kennedy testifying in front of the Senate Appropriations Labor-HHS Subcommittee. The House Oversight and Government Reform Economic Growth, Energy Policy, and Regulatory Affairs Subcommittee and Health Care and Financial Services Subcommittee will hold a joint hearing on the Inflation Reduction Act. Meanwhile, we await the president’s full budget request for FY 2026.

Competition Currents | May 2025

United States
A. Federal Trade Commission (FTC)
1. FTC requests public comment on EnCap, Verdun, XCL petition to modify order.
On April 2, 2025, the FTC announced it was seeking public comments through May 2, 2025, on a petition to reopen and modify its 2022 consent order relating to Verdun Oil Company II LLC’s acquisition of EP Energy LLC. Specifically, the parties asked to remove a prior approval requirement in the consent order (requiring the parties to seek prior approval from the FTC before engaging in certain related transactions in the future) that covered Verdun, which was under common management with XCL Resources Holdings, LLC at the time of the transaction, and their parent entities, EnCap Energy Capital Fund XI, L.P. and EnCap Investments L.P. (together, EnCap). See GT’s April 2022 Competition Currents for more information regarding the original consent order. In their request, the parties noted market changes since the consent decree was entered (including EnCap’s and XCL’s exit from crude oil exploration and production in the Uinta Basin area in Utah after a 2024 sale), which they argue obviates the need for a prior approval requirement.
2. FTC approves modification of Enbridge Inc. final order.
On April 8, 2025, the FTC approved a petition by Enbridge Inc. to set aside the 2017 final consent order in Enbridge’s merger with Spectra Energy Corp. At the time of the Spectra acquisition, Enbridge received an indirect ownership interest in the Discovery Pipeline, a competitor to the Walker Ridge Pipeline that Enbridge owns. The FTC was concerned that the acquisition would give Enbridge access to competitively sensitive information about the Discovery Pipeline and required Enbridge to establish firewalls to limit its access to information relating to the Discovery Pipeline as well as requiring Discovery Pipeline board members affiliated with Spectra to recuse themselves from votes involving the pipeline. In December 2024, Enbridge asked the FTC to reopen and set aside the 2017 order after it sold its interest in the Discovery Pipeline, making the consent decree terms obsolete.
3. Mark Meador confirmed as FTC commissioner.
President Trump nominated Mark Meador as FTC Commissioner, the Senate confirmed him on April 10, 2025, and he was sworn in as commissioner on April 16, 2025. Most recently, Meador worked in private practice and served as a visiting fellow at the Heritage Foundation Tech Policy Center. Previously, he was the deputy chief counsel for antitrust and competition policy for Sen. Mike Lee (R-Utah), as well as a trial attorney in the DOJ Antitrust Division. His term as FTC commissioner will expire on Sept. 25, 2031.
4. FTC seeks public comment on petition to modify Chevron-Hess final order.
The FTC announced on April 11, 2025, that it is seeking public comment through May 12, 2025, on a petition to set aside its final consent order (issued in January 2025) relating to Chevron Corporation’s acquisition of Hess Corporation. The consent order prohibited Chevron from appointing Hess CEO John B. Hess to its board of directors, as called for in the transaction’s merger agreement.
5. FTC seeks public comment on petition to modify Exxon-Pioneer final order.
Similarly, the same day, the FTC also announced that it is also seeking public comment through May 12, 2025, on a petition to set aside its final consent order (also issued in January 2025) relating to Exxon Mobil Corporation’s acquisition of Pioneer Natural Resources. The consent order prohibited Exxon Mobil from appointing Scott Sheffield (founder and former CEO of Pioneer) to its board of directors or from having him serve in any advisory capacity.
6. FTC launches public inquiry into anticompetitive regulations.
On April 14, 2025, the FTC announced that in response to President Trump’s executive order “Reducing Anticompetitive Regulatory Barriers,” it was launching a request for information on the impact of federal regulations on competition (to determine whether any regulations unnecessarily exclude new entrants or protect incumbents, for example). Comments can be submitted through May 27, 2025.
7. Illinois and Minnesota join FTC lawsuit challenging medical device coatings deal.
In March 2025, the FTC sued to block GTCR BC Holdings, LLC’s proposed acquisition of Surmodics, Inc., both of whom engage in manufacturing medical device coatings. GTCR is a private equity firm that also owns a majority of Biocoat, Inc., which per the FTC is the second-largest provider of outsourced hydrophilic coatings, with Surmodics being the largest. The FTC’s complaint alleges that the proposed acquisition is anticompetitive because it would give the combined company more than 50% of the market share for outsourced hydrophilic coatings, which medical device manufacturers use in devices including catheters and guidewires. On April 17, 2025, the FTC amended its complaint to add Illinois and Minnesota as co-plaintiffs.
8. FTC and DOJ issue letter seeking identification of anticompetitive regulations across the federal government.
Also as part of the antitrust agencies’ response to the executive order “Reducing Anticompetitive Regulatory Barriers,” on May 5, 2025, the FTC and DOJ issued a joint letter to all federal government agency heads requesting a list of anticompetitive federal regulations within the respective agency’s rulemaking authority that could reduce competition and innovation – including the agency’s recommendation for whether the regulation should be kept, amended, or rescinded. After receiving public and agency comments, the FTC and DOJ will provide the Office of Management and Budget with its consolidated recommendations.
B. Department of Justice (DOJ) Civil Antitrust Division
1. Justice Department hosts roundtables to address competition issues in the entertainment industry and unfair practices in the labor market.
On April 4, 2025, the DOJ hosted discussions centered on competition issues in the entertainment industry. First, DOJ Assistant Attorney General (AAG) Gail Slater met with union members and legal experts to discuss how non-compete agreements and no-poach agreements impact employees, with experts weighing in on strategies to protect workers. Second, AAG Slater discussed unfair practices in the live entertainment market in order to identify labor-market conduct that harms workers.
2. AAG Gail Slater welcomes Antitrust Division leadership team.
On May 1, AAG Slater appointed Dina Kallay to serve as DOJ deputy assistant attorney general for international, policy and appellate, joining the DOJ leadership team of Roger Alford (principal deputy assistant attorney general), Omeed Assefi (acting deputy assistant attorney general), Mark Hamer (deputy assistant attorney general), William “Bill” Rinner (deputy assistant attorney general), Dr. Chetan Sangvhi (deputy assistant attorney general), and Sara Matar (chief of staff).
3. Justice Department and FTC seek information on unfair and anticompetitive practices in live ticketing.
On May 7, 2025, the DOJ announced that in response to President Trump’s executive order “Combating Unfair Practices in the Live Entertainment Market,” it was launching, jointly with the FTC, a public inquiry aimed at identifying unfair and anticompetitive practices in the live entertainment market. AAG Slater stated of the inquiry, “Competitive live entertainment markets should deliver value to artists and fans alike,” while FTC Chair Ferguson also added, “Many Americans feel like they are being priced out of live entertainment by scalpers, bots, and other unfair and deceptive practices.” Comments can be submitted through July 7, 2025.
C. U.S. Litigation
1. Chalmers v. National Collegiate Athletic Association, Case No. 1:24-cv-05008 (S.D.N.Y. April 29, 2025).
On April 29, U.S. District Judge Paul A. Engelmayer dismissed a proposed class action by 16 former men’s basketball players against the National Collegiate Athletic Association (NCAA). The antitrust suit was filed last July, a month after the announcement of the $2.78 billion settlement that would compensate past athletes for their name, image, and likeness (NIL) and put a future revenue sharing plan in place. The players’ college careers spanned from 1994 to 2016, and Engelmayer agreed with the NCAA’s argument that the statute of limitations on their claims expired, noting in his opinion that “the NCAA’s use today of a NIL acquired decades ago as the fruit of an antitrust violation does not constitute a new overt act restarting the limitations clock.”
2. Compass Inc. v. Northwest Multiple Listing Services, Case No. 2:25-cv-00766 (W.D. Wash. Apr. 28, 2025).
On April 28, Compass Inc. sued the broker-led Northwest Multiple Listing Service (MLS), claiming that the MLS’s rules in Washington that prohibit “premarketing” real estate before they are officially listed for sale is an anticompetitive boycott. Compass—a broker service operating in Washington—engages in “office exclusive” listing that tests the asking price, pictures, and home specifications to a small set of potential buyers before the home is actually put up for sale. Compass alleges that the practice is used in other states, but that Washington prohibits this premarketing because it is “fundamentally unfair and perpetuates inequities that have long plagued the housing system.”
3. Mack’s Junk Removal LLC v Rouse Services LLC, Case No. 2:25-cv-03565 (N.D. Ill. Apr. 23, 2025).
A nationwide class action was filed alleging several large construction equipment rental companies utilized RB Global Inc.’s product, Rouse, to set rates for construction equipment rental. According to the allegations, rental companies defer all rental-pricing decisions to Rouse, which uses an AI algorithm to set rates at anticompetitive levels. The complaint also alleges that Rouse allows participants to get detailed sales data of local competitors, allowing for a greater chance of price fixing.
4. Regeneron Pharmaceuticals Inc. v. Amgen Inc., Case No. 1:22-cv-00697 (D. Del. Apr. 11, 2025).
On April 11, 2025, U.S. District Judge Jennifer L. Hall denied defendant Amgen Inc.’s motion to dismiss an antitrust lawsuit. In the lawsuit, competitor Regeneron Pharmaceuticals alleges that Amgen improperly bundled discounts of its other medications—in which it has market dominance—to pharmacy benefit managers if they would agree to exclusively cover Amgen’s Repatha, a cholesterol-reducing medication. Regeneron, which offers a competing cholesterol medication, claims that such bundling schemes effectively drive other competitors out of the market. In her ruling, Judge Hall held that Regeneron has presented evidence of both improper bundling and “de facto exclusive dealing arrangements” to proceed to further discovery.
The Netherlands
ACM
1. The ACM approves sustainability collaboration in textile sector under competition rules.
The Dutch competition authority (ACM) has issued an informal assessment of the Textile Alliance — an initiative involving companies, trade associations, and civil society organizations in the garments, shoes, leather, and textile sectors — concluding that the initiative complies with Dutch and EU competition law.
The Textile Alliance aims to promote international corporate social responsibility by improving compliance with human rights, environmental, and animal-welfare standards in production and supply chains. According to ACM’s assessment, the arrangements focus on individual company commitments and voluntary tools, such as a collective risk assessment, without mandating uniform actions or exchanging competition-sensitive information. The assessment affirms that competition law does not necessarily pose a barrier to sector-wide sustainability agreements.
2. The ACM approves FincoEnergies’ acquisition of Klaas de Boer with conditions.
The ACM has approved FincoEnergies’ acquisition of Oliehandel Klaas de Boer with conditions to maintain competition in the marine fuel supply market. Both companies are major suppliers of marine fuels in several Dutch ports. The ACM had competition concerns due to limited alternative suppliers and high costs for buyers to switch ports. To address this, FincoEnergies and Klaas de Boer must sell various assets, including tankers and a storage terminal, to GMB Groep and Slurink Transport Services, ensuring continued competition in the affected ports and eliminating competition concerns.
3. The ACM emphasizes the importance of competition for European competitiveness in joint statement.
Certain European competition authorities, including the ACM, have issued a joint statement highlighting the crucial role of competition in enhancing European competitiveness. The statement aligns with the European Commission’s recently presented “Competitiveness Compass” and emphasizes that competition fosters productivity, innovation, and investment. The authorities assert that competition and economies of scale go hand in hand and that competition rules are essential for well-functioning markets. The statement specifically addresses competition in the telecom sector, where the authorities warn that reduced merger scrutiny, particularly in telecommunications, may result in fewer incentives to improve networks, services, and innovation. As such, careful oversight of mergers is deemed necessary. Mergers that harm competition should either be blocked or approved only under strict conditions. The national competition authorities of Belgium, Portugal, Austria, Czech Republic, Ireland, and the Netherlands signed the joint statement.
4. The ACM informs healthcare institutions of competition rules for new cancer and vascular surgery standards.
The ACM has issued guidance to healthcare providers on how to comply with competition law when making regional agreements on the redistribution of care, following new national volume norms for cancer and vascular treatments. These norms limit certain complex procedures to hospitals that perform them frequently, starting in 2026. The ACM emphasized that while cooperation is allowed, such agreements must not amount to unlawful market sharing. The ACM will not intervene in regional care arrangements if all relevant stakeholders are involved and the cooperation pursues clear, measurable goals aimed at improving care accessibility, affordability, and quality.
Poland
A. UOKiK issues conditional clearance for Medicover’s acquisition of CityFit Gyms.
On March 31, 2025, the President of the Polish Office of Competition and Consumer Protection (UOKiK) conditionally approved ABC Medicover Holdings B.V.’s acquisition of 16 fitness clubs. ABC Medicover is a member of the Medicover group, a major private healthcare provider. The transaction consists of the acquisition of sole control over 16 companies operating under the CityFit and CityFit Blue brands. Medicover already has a strong presence in the Polish fitness sector through such brands as Just Gym, Well Fitness, McFit, Stellar, Platinum Fitness, Smart Gym, and Premium Fitness & Gym, operating over 150 clubs nationwide.
Based on its competition assessment, the UOKiK President concluded that while the concentration would not significantly restrict competition on most relevant markets, serious concerns arose in two cities (Bielsko-Biała and Gliwice) where the post-transaction market shares would be particularly high. To address these concerns, the clearance was made conditional on structural remedies. Medicover must divest one club in each of the two concerned cities — either an existing Medicover location or a CityFit club included in the acquisition. The buyer must be an independent third party the UOKiK President approves, with a credible commitment to operating a fitness facility at the divested location for a minimum of two years.
B. UOKiK launches investigation and conducts dawn raids in home appliances sector.
On March 31, 2025, the UOKiK President announced it was launching a preliminary investigation into a suspected price-fixing agreement between Electrolux Poland and major electronics retailers. The proceedings focus on suspicions that Electrolux Poland may have coordinated the retail prices of household appliances—including refrigerators, washing machines, dishwashers, coffee machines, ovens, vacuum cleaners, irons, and kettles—sold under the Electrolux and AEG brands. According to the authority, these practices may have prevented consumers from benefiting from lower prices, both online and in brick-and-mortar stores.
Based on signals received from the market indicating potential antitrust violations, the UOKiK President, after securing court approval, conducted unannounced inspections at the headquarters of Electrolux Poland and several entities operating retail chains, including companies running major home appliances chain stores. The case is still at its preliminary stage and is conducted in rem, meaning that it is not yet directed at any specific undertakings. Should evidence confirm the suspicions, the UOKiK President may open formal antitrust proceedings and bring charges against identified entities.
The investigation follows recent enforcement actions in the sector. Notably, in 2024, the UOKiK imposed over PLN 66 million in fines on companies involved in a decade-long price-fixing scheme concerning Jura-brand coffee machines. That decision also included a close to PLN 250,000 fine on an individual responsible for the agreement.
Italy
Italian Competition Authority (ICA)
1. ICA launches investigation against CNF for alleged concerted practice.
On March 25, 2025, ICA opened an investigation into the National Bar Council (CNF) for an alleged concerted practice in violation of Article 101 of TFEU. The investigation concerns the application of the “fair compensation rule” for lawyers, introduced by Law No. 49/2023. The “fair compensation rule” aims to provide specific protections for legal professionals when dealing with large clients, based on the presumption lawyers are often compelled to accept reduced fees from such clients.
According to ICA, CNF’s interpretation and enforcement of these rules—particularly through the new Article 25-bis of the Lawyers Code of Ethics—exceeds the scope of the law and may restrict competition among lawyers. ICA specifically challenged CNF’s use of ambiguous language prohibiting lawyers from agreeing upon or estimating fees, without specifying the context or limits. In ICA’s view, this lack of clarity failed to specify that the fair compensation obligations (and related disciplinary consequences) apply only to relationships with large corporate clients. By doing so, CNF is allegedly attempting to directly influence the economic behavior of lawyers under its supervision, potentially deterring them from negotiating fees below the indicated benchmarks.
ICA has given CNF a 60-day deadline, starting from the date of notification of this decision, to exercise its right to be heard by the legal representatives of the party. ICA has established that the procedure must conclude by the end of December 2026.
2. Unfair commercial practice: fine of almost EUR 20 million has been imposed on CoopCulture and other tourist operators.
On March 25, 2025, ICA fined Società Cooperativa Culture (CoopCulture) and the following tourist operators: Tiqets International BV, GetYourGuide Deutschland GmbH, Walks LLC, Italy With Family S.r.l., City Wonders Limited, and Musement S.p.A. almost EUR 20 million for making it difficult to purchase tickets online to access the Colosseum Archaeological Park. Specifically, the ICA found that CoopCulture failed to take adequate measures to counter ticket hoarding using automated methods while also reserving significant quantities of tickets for sales offered during its own educational tours, from which it gained considerable economic benefits. This forced consumers to turn to tour operators and platforms that resold tickets bundled with additional services (such as tour guides and pick-up) at significantly higher prices.
At the same time, the six tourist operators purchased tickets using bots or other automated tools, thus contributing to the rapid depletion of base-price tickets on the CoopCulture website. By doing so, these operators took advantage of the systematic unavailability of tickets, which forced consumers who wished to visit the Colosseum to obtain tickets bundled with additional services. ICA found that CoopCulture’s conduct constitutes an unfair commercial practice in violation of Article 20, paragraph 2, of the Italian Consumer Code. Also, the conduct of Tiqets International BV, GetYourGuide Deutschland GmbH, Walks LLC, Italy With Family S.r.l., City Wonders Limited, and Musement S.p.A. was found to be unfair under Articles 24 and 25 of the Italian Consumer Code.
3. Key takeaways from ICA’s annual report.
On March 31, 2025, ICA published its annual report on its 2024 activities. During 2024, ICA’s activity recorded a notable increase, both in quantitative and qualitative terms, confirming a trend established in recent years. Notably, between January 2024 and March 2025, ICA received 1,452 competition-related reports, examined 121 merger transactions, and concluded two proceedings on restrictive agreements and nine on abuse of dominant position.
In particular, the number of merger filings ICA reviewed increased by approximately 50% compared to the average of the past 10 years. Moreover, in seven cases, ICA exercised its call-in power, pursuant to Article 16, paragraph 1-bis, of Law No. 287/1990, to require notification of a merger not reaching the turnover thresholds for mandatory notification. According to the ICA, recent legislative amendments strengthened its investigative and intervention tools, also contributing to reinforcing enforcement activities against cartels. ICA initiated four proceedings, with over eight investigations covering as many sectors and over 30 companies. ICA reported that the intensified efforts to counter the most serious antitrust violations is also attributable to the establishment of the whistleblowing platform, which received over 200 reports, and to the leniency program, which was recently enhanced.
As for consumer protection, between January 2024 and March 2025, ICA examined 36,900 reports and concluded 71 proceedings; 46 with confirmation of the infringement, 17 with acceptance of commitments, and eight with no violations. According to the ICA’s estimates, the consumer protection activities carried out between 2023 and 2024 enabled savings of over EUR 28 million, as well as the restitution of more than EUR 150 million to 900,000 consumers.
European Union
A. European Commission
1. The European Commission opens investigation into UMG’s acquisition of Downtown after referral from the Netherlands and Austria.
The European Commission has accepted a referral request from the ACM to investigate Universal Music Group’s proposed acquisition of Downtown, a service provider to independent labels and artists. The ACM expressed concerns that the acquisition may negatively affect competition in the Netherlands and potentially other EU countries. Universal Music Group, the world’s largest record company, has a history of acquiring smaller industry players, often without regulatory oversight due to low turnover thresholds.
In this case, the ACM was notified about the acquisition in February 2025, and the deal prompted complaints from industry stakeholders. The Austrian competition authority supported the ACM’s request for a European-level review. The ACM reiterated its call for a “call-in power” to enable review of smaller, potentially harmful mergers even when they fall below standard notification thresholds. The European Commission has now launched a formal investigation into the deal’s cross-border competitive effects.
2. European Commission fines car manufacturers and ACEA EUR 458 million for cartel on end-of-life vehicle recycling.
The European Commission has fined 15 major car manufacturers and the European Automobile Manufacturers’ Association (ACEA) approximately EUR 458 million for their involvement in a long-running cartel concerning the recycling of end-of-life vehicles (ELVs). The cartel, which lasted over 15 years, involved coordination on avoiding payments to car dismantlers and restricting transparency around recycling rates in new vehicles.
Mercedes-Benz was granted immunity under the leniency program for informing the European Commission of the anticompetitive behavior. Other companies admitted their involvement and agreed to settle the case. Some companies received a reduction of their fine for cooperation under the leniency program. This decision is part of the European Commission’s broader efforts to enforce EU competition rules and address anticompetitive practices in the automotive sector.
3. The European Commission approves Safran’s acquisition of Collins Aerospace, with conditions.
The European Commission has approved Safran USA Inc.’s acquisition of parts of Collins Aerospace’s actuation business, subject to commitments to address competition concerns. Safran’s and the target’s businesses are largely complementary, but the initial transaction raised competition concerns, particularly in the market for trimmable horizontal stabilizer actuator (THSA) systems. These systems, used in civil aircraft, were found to have insufficient alternative suppliers post-merger.
To resolve these concerns, Safran committed to divesting its North American THSA business. A market test confirmed the remedy’s effectiveness, and the European Commission approved the deal subject to full compliance, which will be monitored by an independent trustee.
B. European General Court
General Court upholds Symrise raids in cross-border fragrance cartel investigation.
The EU’s General Court has rejected Symrise’s challenge to annul European Commission’s raids of its premises during a 2023 cross-border cartel investigation into the fragrance industry. The court found that the European Commission had sufficient grounds for inspections, based on credible evidence, including open-source intelligence, suspiciously similar tender bids, and confidential information exchanges. Symrise argued that the raids infringed its privacy and defense rights due to an alleged lack of reasonable suspicion. However, the court ruled that the broader context of international cartel suspicion, including indications from Symrise’s own activities and third-party findings, justified the European Commission’s actions. Symrise stressed that the ruling does not equate to the finding of guilt and reaffirmed its denial of any anticompetitive behavior, stating it continues to cooperate with authorities.

1 Due to the terms of GT’s retention by certain of its clients, these summaries may not include developments relating to matters involving those clients.
Additional Authors: Holly Smith Letourneau, Sarah-Michelle Stearns, Yongho “Andrew” Lee, Alexa S. Minesinger, Alexander L. Nowinski, Miguel Flores Bernés, Valery Dayne García Zavala, Hans Urlus, Dr. Robert Hardy, Chazz Sutherland, Manish Das, Johnny Shearman, Robert Gago, Filip Drgas, Anna Celejewska-Rajchert, Ewa Głowacka, Edoardo Gambaro, Pietro Missanelli, Martino Basilisco, Yuji Ogiwara, Mari Arakawa, Philip Ruan, and Dawn (Dan) Zhang.

Brussels Regulatory Brief: April 2025

Antitrust and Competition
European and UK Antitrust Enforcers Impose Fines Over End-of-Life Vehicles Recycling Cartel
On 1 April 2024, both the European Commission (the Commission) and the UK Competition and Markets Authority (CMA) fined major car manufacturers and trade associations for participating in a 15-year long cartel concerning end-of-life vehicle recycling. The Commission’s and CMA’s decisions highlight the authorities’ interest in pursuing novel theories of harm that may have an adverse impact on the green transition.
Financial Affairs
EU Institutions Finalize Omnibus I; EFRAG adopts Work Plan to Simplify ESRS
The European Parliament and the Council of the European Union finalized the legislative procedure for Omnibus I, while the European Financial Reporting Advisory Group (EFRAG) adopted the work plan detailing next steps for European Sustainability Reporting Standards (ESRS) simplification.
Commission Presents Savings and Investments Union
The Commission presented its Savings and Investment Union, outlining future legislative and nonlegislative initiatives to strengthen EU capital markets.
Sanctions
European Court of Justice Confirmed that the Ban on the Export of EU Banknotes to Russia Also Applies when the Money Is Intended to Finance Medical Treatments
The European Court of Justice ruled that only amounts strictly necessary for travel and basic living expenses may be brought into Russia.
Antitrust and Competition
European and UK Antitrust Enforcers Impose Fines Over End-of-Life Vehicles Recycling Cartel
On 15 March 2022, the European Commission (Commission) and the UK Competition and Markets Authority (CMA) conducted parallel unannounced inspections (dawn raids) at the premises of companies and trade associations active in the automotive sector in several EU member states and in the United Kingdom. On 1 April 2025, the Commission fined 15 major car manufacturers and a trade association a total of approximately €458 million for participating in a 15-year-long cartel concerning the recycling of end-of-life vehicles (ELVs), i.e., cars that are no longer fit for use, either due to age, wear and tear, or damage. On the same day, the CMA imposed fines against 10 car manufacturers and two trade associations of approximately £77.7 million for breaching UK competition law for a similar conduct affecting the UK market.
Both the Commission and the CMA found that the parties infringed EU and UK competition law by colluding on two aspects:

Car manufacturers agreed not to pay car dismantlers for processing ELVs and shared commercially sensitive information on their individual agreements with car dismantlers. The car dismantlers were therefore unable to negotiate a price with the car manufacturers.
The parties also agreed not to advertise how ELVs could be recycled, recovered, and reused, and how much recycled materials are used in new cars. The Commission stated that the car companies’ objective was to prevent consumers from considering recycling information when choosing a car, which could lower the pressure on companies to improve their environmental efforts and go beyond legal requirements on recyclability.

The Commission’s and CMA’s investigations involved trade associations that were found to act as a facilitator of the cartel by arranging meetings and contacts between car manufacturers.
Both investigations were triggered by a leniency application submitted by one of the cartel participants. As this participant has revealed the cartel, it was not fined and received full immunity from penalties. In addition, all companies admitted their involvement in the cartel and agreed to settle the case, which reduced the fine by 10% in the Commission’s investigation and 20% in the CMA’s investigation.
Teresa Ribera, executive vice president for Clean, Just and Competitive Transition, commented:
We will not tolerate cartels of any kind, and that includes those that suppress customer awareness and demand for more environmental-friendly products. High quality recycling in key sectors such as automotive will be central to meeting our circular economy objectives, not only to cut waste and emissions, but also to reduce dependencies, lower production costs and create a more sustainable and competitive industrial model in Europe.

The Commission also stated that this investigation was the largest settlement case it has concluded so far. This shows that the Commission can use the settlement procedure in exceptionally large settlement cases. Also, this parallel investigation illustrates the Commission’s and the CMA’s close coordination in investigating novel theories of harm that may have an adverse impact on the green transition.
Financial Affairs
EU Institutions Finalize Omnibus I; EFRAG Adopts Work Plan to Simplify ESRS
On 3 April, the European Parliament approved the text of the first part of the Omnibus package (Omnibus I). Omnibus I postpones the application date of the reporting requirements under the Corporate Sustainability Reporting Directive (CSRD) by two years for certain groups of companies, and it also postpones the transposition deadline as the first wave of application of the Corporate Sustainability Due Diligence Directive by one year. Members of the European Parliament (MEPs) largely supported the proposal: 531 voted in favor, 69 against, and 17 abstained. The pro-European political groups (the European People’s Party, the Socialists and Democrats, and Renew Europe) were able to reach an agreement to approve the content of the proposal a few hours before the votes. Further, the final text of Omnibus I was published in the Official Journal of the European Union on 17 April and is now in force at the EU level. The directive mandates member states to transpose it into national law by 31 December 2025.
In a related development, the European Financial Advisory Reporting Group (EFRAG) adopted its work plan on the simplification of European Sustainability Reporting Standards (ESRS) under CSRD. This review is part of EFRAG’s broader mandate to assess the entire ESRS framework, as set out in a mandate letter from Commissioner Maria Luís Albuquerque. EFRAG is expected to submit its technical advice to the Commission by 31 October 2025.
Now that the first part of the package is completed, MEPs and member states at the Council of the European Union are discussing internally their approach to the second part (Omnibus II), which introduces substantial simplification amendments to the obligations and requirements notably comprised in these two frameworks. Check this article for a summary of the proposed amendments by Omnibus II.
Commission Presents Savings and Investments Union
On 19 March, the Commission issued a Communication on the Savings and Investments Union, seeking to offer EU citizens broader access to capital markets and better financing opportunities for businesses. The strategy focuses on four key pillars: (i) citizens and savings, (ii) investments and financing, (iii) integration and scale, and (iv) efficient supervision in the single market. For each pillar, the Commission underlined both legislative and nonlegislative actions to be adopted throughout 2025 and 2026.
For citizens and savings, the Commission underlined that it would facilitate negotiations between the European Parliament and member states on the Retail Investment Strategy, but it will not hesitate to withdraw the proposal if the negotiations do not meet the objectives of the strategy. Key initiatives include a review of pension frameworks to bolster retail investor participation, a financial literacy strategy by Q3 2025, and a EU-wide framework for savings and investment accounts. For the investment and financing pillar, the Commission aims to facilitate equity investments by institutional investors, revise Solvency II criteria for long-term equity investments, and streamline securitization requirements by mid-2025, with additional reforms targeting private market liquidity due in 2026.
On integration and supervision, the Commission plans to reduce capital market fragmentation and enhance cross-border activity through emerging technologies such as artificial intelligence, simplifying rules for asset managers and potentially reviewing the Shareholders Rights Directive. In the context of capital markets integration, the Commission launched a public consultation to gather views on obstacles to financial markets integration across the European Union. On oversight, reforms to the European Supervisory Authorities could delegate supervisory powers to EU-level bodies, particularly for crypto services and large cross-border managers.
The Commission will conduct a midterm review of the strategy by mid-2027 to assess progress and refine initiatives.
Sanctions
European Court of Justice Confirmed that the Ban on the Export of EU Banknotes to Russia Also Applies when the Money Is Intended to Finance Medical Treatments
Under EU sanctions imposed on Russia, it is prohibited to sell, supply, transfer, or export banknotes denominated in any official currency of an EU member state to Russia or to any natural or legal person, entity, or body in Russia, including the Russian government and the Central Bank of the Russian Federation, or for use in Russia. Only three limited exemptions to this general ban exist: (i) export of banknotes for the personal use of natural persons traveling to Russia or members of their immediate families traveling with them, (ii) export of banknotes for the official purposes of diplomatic missions, or (iii) export necessary for civil society and media activities that directly promote democracy, human rights, or the rule of law in Russia.
In case C-246/24, Generalstaatsanwaltschaft Frankfurt am Main, delivered on 20 April 2025, the European Court of Justice addressed the situation where German customs officers discovered a passenger heading to Russia carrying nearly €15,000 in banknotes. The passenger stated the money was intended not only for travel costs but also for medical procedures in Russia, including dental work, hormone therapy for fertility, and follow-up care after breast surgery. Authorities confiscated most of the money, permitting the passenger to retain around €1,000 for travel-related needs.
The court ruled that carrying banknotes to Russia for medical treatment does not qualify as personal use under the exemption. The court reiterated that exceptions are to be interpreted strictly so that general rules are not negated. A broad interpretation of the exemption would result in a situation where it would be possible to transfer to Russia, without restriction, large sums of banknotes to make personal purchases of any kind there, and, moreover, it would be difficult to verify that such purchases are carried out.
The exemption in question is limited to covering costs directly related to the journey and stay—medical treatments do not fall within that scope, as the EU sanctions are ultimately intended to prevent the Russian economic system from gaining access to cash denominated in any currency of a EU member state to support Russia’s activities in the war in Ukraine.
Additional Authors: Petr Bartoš, Vittoriana Todisco, Kathleen Keating, Sara Rayon Gonzalez, Covadonga Corell Perez de Rada, Simas Gerdvila, Edoardo Crosetto, and Martina Pesci.

UPDATE – Departments Issue Nonenforcement Policy Statement!

Regulators Pause Mental Health Parity Rules Enforcement

Federal regulators recently indicated they will not enforce parts of the final regulations issued in September 2024 under the Mental Health Parity and Addiction Equity Act (MHPAEA) and may soon propose new rules altogether.

Quick Hits

A federal judge recently paused litigation over the 2024 mental health parity regulations focused on nonquantified treatment limitations.
The Trump administration is considering rescinding or adjusting the rules.
The federal agencies will not enforce the 2024 rules in the short term.

On May 12, 2025, the U.S. District Court for the District of Columbia agreed to stay a lawsuit brought by the ERISA Industry Committee to block the 2024 rules related to nonquantitative treatment limitations (NQTLs).
The U.S. Departments of Health and Human Services, Labor, and Treasury requested a stay in the case, telling the court that they are considering rescinding or modifying the 2024 rules. They issued a nonenforcement policy on the portions of those regulations that took effect January 1, 2025, or would take effect January 1, 2026.
The agencies also directed health plans to continue to rely on the 2013 MHPAEA regulations and prior subregulatory guidance.
Background on the Case
Under the federal Mental Health Parity and Addiction Equity Act (MHPAEA), if a health plan offers mental health and substance use disorder benefits alongside medical and surgical benefits, it must provide the mental health and substance use disorder benefits in a manner that is no more restrictive than the medical and surgical benefits.
On September 23, 2024, the federal government issued final rules requiring health plans to provide “meaningful benefits” for mental health or substance use disorders in coverage categories where medical or surgical benefits are also provided. Meaningful benefits cover core treatments, defined as standard treatments or interventions indicated by “generally recognized independent standards of current medical practice.” These regulations require that a plan fiduciary certify that it undertook a prudent process to select a qualified service provider to perform the comparative analysis.
On January 17, 2025, the ERISA Industry Committee sued the three federal agencies to block the 2024 regulations.
Next Steps
Employers may wish to review their mental health and substance use disorder coverage in order to ensure compliance with the MHPAEA. While parts of the 2024 mental health parity rules will not be enforced for now, employers may wish to anticipate that the agencies could propose changes to the 2024 rules or propose new rules in the future.
Importantly, the requirement to perform and document a comparative analysis of a plan’s NQTLs still exists.

How Modern Workplaces Navigate Generational Shifts: One-on-One with Jeff Landes [Video]

Generational shifts in the workplace bring unique challenges and opportunities for employers striving to build productive and engaged teams.
In this one-on-one conversation, Epstein Becker Green attorney Jeff Landes joins George Whipple to explore strategies for managing and motivating the emerging workforce, with a particular focus on “Gen Z” employees. Jeff examines how organizations can adapt to generational expectations, including fostering transparency, providing meaningful feedback, and supporting mental health and wellness initiatives.
The discussion also addresses the evolving dynamics of hybrid and remote work, underscoring the importance of consistent performance management, clear communication, and innovative accommodations. From creating inclusive environments to navigating requests for flexible schedules, Jeff offers practical advice for handling the complexities of a modern workforce while maintaining operational efficiency.
Listen now to gain actionable ideas for workforce development and learn how to create a workplace culture that aligns with both employee needs and business goals.

Health Care Fraud and Abuse 2024 Year in Review

Polsinelli proudly presents the Health Care Fraud and Abuse 2024 Year in Review, offering a comprehensive analysis of False Claims Act (FCA) enforcement and broader fraud and abuse developments over the past year.
Read the Full E-Book Here
Sabrina Marquez, Nicole K. Nielly, and Evan M. Schrode contributed to this article

Departments Press Pause on Final Mental Health Parity Regulations

Yesterday, the Departments of Labor, Treasury, and Health and Human Services announced a non-enforcement policy with respect to final regulations issued under the Mental Health Parity and Addiction Equity Act of 2008 (“MHPAEA”) in September 2024. The Departments recently indicated that this policy was imminent when they requested that litigation challenging the final regulations be paused while they considered rescission or modification of the regulations.
The 2024 final regulations, which we blogged about here, included sweeping changes that would have impacted virtually all group health plans that cover mental health and substance use disorder (MH/SUD) benefits.
What the non-enforcement policy does and does not do
The non-enforcement policy states that the Departments will not enforce the final regulations issued in 2024. However, this applies only to the portions of the 2024 final regulations that were “new” in relation to the 2013 final regulations.
What remains in effect: Thus, plan sponsors should keep in mind that MHPAEA and the final regulations issued in 2013 (including subsequent sub-regulatory guidance, such as agency FAQs) remain in place and should continue to be relied upon for guidance. Additionally, the statutory obligation for a plan to maintain non-quantitative treatment limitation (NQTL) comparative analyses for MH/SUD benefits and provide them to the Departments upon request remains in effect. (This statutory obligation was added as part of the Consolidated Appropriations Act, 2021.)
What is paused: The significant changes in the 2024 final rule that were new compared to the 2013 final rule—including the fiduciary certification requirement, the “meaningful benefits” standard, and revised standards for evaluating NQTLs—are all paused for the time being while the Departments reconsider their mental health parity compliance and rulemaking approach.
It bears noting that the Departments stated not only that they intend to reconsider the final rule, but also that they are conducting a “broader reexamination of each department’s respective enforcement approach.” This, and other language in the non-enforcement policy, suggests that the Departments will be looking at whether changes are necessary to balance the important goals of MHPAEA and the burdens that the current enforcement has imposed on plan sponsors.
How long does the non-enforcement policy last?
The Departments will not enforce the 2024 final rule or pursue enforcement actions based on a failure to comply that occurs prior to the final decision in the litigation, plus an additional 18 months. Plan sponsors should monitor subsequent updates from the Departments to confirm compliance.
* * *
Takeaways for group health plan sponsors: Given the challenges plan sponsors have faced in connection with the implementation of the current regulatory and enforcement scheme, the non-enforcement policy is likely welcome news. However, plan sponsors should remain mindful that the 2013 final rule and MHPAEA statutory obligations are still in place and not impacted by the non-enforcement policy. For now, while plan sponsors can pause compliance efforts related to the 2024 final rule, plans may want to consider pressing ahead with any current compliance projects related to the 2013 final rules and statutory obligations related to NQTL comparative analyses.

DOJ Announces Key Corporate Enforcement Changes & White-Collar Priorities

DOJ recently announced white-collar crime enforcement priorities and significant changes to its corporate enforcement policies (here and here). “[O]verbroad and unchecked corporate and white-collar enforcement burdens U.S. businesses and harms U.S. interests,” and “[n]ot all corporate misconduct warrants federal criminal prosecution,” according to the memo. New changes to these DOJ policies are intended to help companies navigate what to expect when making a disclosure and clarify the additional benefits that are available to companies that self-disclose and cooperate.
Priority Enforcement Areas
DOJ’s Criminal Division will prioritize investigating and prosecuting white-collar crimes in certain identified high-impact areas, as summarized below:

Health care and federal program and procurement fraud;
Trade and customs fraud, including tariff evasion;
Fraud perpetrated through variable interest entities, including securities fraud, and other market manipulation schemes;
Market manipulation including, Ponzi schemes, investment fraud, elder and servicemember fraud, and health and safety consumer fraud;
National security threats to the U.S. financial system by financial institutions and their insiders that commit sanctions violations;
Material support by corporations to foreign terrorist organizations, including recently designated cartels;
Complex money laundering, including Chinese Money Laundering Organizations, and other organizations involved in laundering funds used in the manufacturing of illegal drugs;
Controlled Substances Act and the Federal Food, Drug, and Cosmetic Act violations, including counterfeit fentanyl pills and unlawful distribution of opioids by medical professionals and companies;
Bribery and associated money laundering that impact U.S. national interests, undermine U.S. national security, harm the competitiveness of U.S. businesses, and enrich foreign corrupt officials; and
Crimes involving digital assets that victimize investors and consumers; that use digital assets in furtherance of other criminal conduct; and willful violations that facilitate significant criminal activity.

DOJ has also called for an increased investigative pace and directed prosecutors to “move expeditiously to investigate cases and make charging decisions” quickly to ensure “that [investigations] do not linger and are swiftly concluded.”
Corporate Enforcement Policy Changes
New changes to the Corporate Enforcement and Voluntary Self-Disclosure Policy (“CEP”) include the following:

For companies that satisfy all required elements from voluntary self-disclosure, to full cooperation, to timely and appropriate remediation, as well as have no aggravating circumstances, the CEP will make clear there “is a clear path to declination.” This is a marked contrast to prior guidance that entitled companies to a “presumption” of a declination.
Companies that are willing to satisfy the core criteria, but have aggravating circumstances that raise concerns for the company to voluntarily self-disclose, may still qualify for declination under the revised CEP. In these cases, the DOJ will consider “the severity of those aggravating circumstances and the company’s cooperation and remediation,” offering a potential outcome to avoid prosecution.
The revised CEP also clarifies that companies may still qualify for meaningful benefits when self-disclosing in good faith – such as a non-prosecution agreement, a 75 percent reduction in criminal fines, and no requirement to appoint a monitor – even if the disclosure is not considered timely or comes after the DOJ, without the company’s awareness, has already discovered the misconduct.

DOJ also announced revisions to the Criminal Division’s standards and policy for the selection of monitors in matters handled by the Criminal Division.
Monitorships will be limited to those cases where deemed “necessary,” including “when a company cannot be expected to implement an effective compliance program or prevent recurrence of the underlying misconduct without such heavy-handed intervention.” Specifically, the monitor selection standards will be revised to clarify “the factors that prosecutors must consider when determining whether a monitor is appropriate and how those factors should be applied,” as well as require that monitorships be “narrowly tailor[ed]…to address the risk of recurrence of the underlying criminal conduct and to reduce unnecessary costs.” Such factors prosecutors may consider include: (1) “the nature and seriousness of the conduct” and the risk of recurrence; (2) other available regulatory oversight; (3) the effectiveness of the company’s compliance program at resolution; and (4) the maturity of the company’s internal controls, including the company’s ability to test its compliance program as well as make improvements.
DOJ’s corporate whistleblower program will also undergo an evaluation to identify “additional areas of focus” that align with the Administration’s key initiatives. “[P]rocurement and federal program fraud; trade, tariff, and customs fraud; violations of federal immigration law; and violations involving sanctions, material support of foreign terrorist organizations, or those that facilitate cartels and TCOs, including money laundering, narcotics, and Controlled Substances Act violations” have all been included as areas of interest.
Takeaways

Voluntary Self-Disclosure now means “a clear path to declination” rather than a “presumption” of a declination.
Look for an uptick in False Claims Act investigations in the international trade area including, customs fraud and tariff evasion.
DOJ is requiring for prosecutors to “move expeditiously to investigate cases,” and will be actively monitoring investigation timelines and progress to ensure prompt resolution. This means that stakeholders and outside counsel will need to conduct internal investigations and make decisions quicker.
Notwithstanding the 180-day FCPA pause, bribery that enriches foreign officials and undermines U.S. business remains a priority.
Monitorships appear to now be the exception, not the rule for corporate resolutions.
Deferred Prosecution Agreements may be back given that DOJ is making clear “[n]ot all corporate misconduct warrants federal criminal prosecution.” Rather, DOJ is directing Criminal Division prosecutors to weigh “additional factors,” such as whether a company self-disclosed and fully cooperated, as well as its remediation efforts, when assessing whether to prosecute.

Companies will want to stay ahead of these developments and revised corporate enforcement policies. As we have reported, well-designed compliance programs help to mitigate not only bribery and corruption risks, but also money laundering, sanctions issues, human rights violations, and financial fraud risks. Effective and adequately resourced compliance programs also help to foster positive speak-up cultures, ensuring that employees feel comfortable to report suspected misconduct via available internal channels and reporting mechanisms. Maintaining robust internal controls make companies better equipped and prepared to flag potential misconduct early as well as navigate difficult considerations around self-disclosure. Companies should continue to evaluate their compliance programs, including the effectiveness and efficiency of their internal reporting mechanisms and internal investigations processes.

Focus, Fairness and Efficiency: DOJ Reveals Administration’s Plans for Enforcement of Corporate and White-Collar Crime

Key Takeaways

DOJ Criminal Division will prioritize enforcement in key areas, including health care fraud, trade and customs violations and national security-related financial crimes.
Companies that voluntarily self-disclose, cooperate and remediate may qualify for declinations, reduced penalties and shortened compliance obligations even where aggravating factors are present.
Corporate compliance agreements will generally be capped at three years, with early termination available based on remediation, risk reduction and program maturity.
Independent compliance monitors will be imposed only when necessary and must be narrowly tailored to limit burden and business disruption.

On May 12, 2025, the Head of the Department of Justice’s (DOJ) Criminal Division, Matthew R. Galeotti, issued a memorandum detailing the Division’s enforcement priorities and policies for prosecuting corporate and white-collar crimes under the Trump administration.
The memorandum describes the need for the Division’s policies to “strike an appropriate balance” between investigating and prosecuting criminal wrongdoing “while minimizing unnecessary burdens on American enterprise.” In accordance with this position, the memorandum describes areas that the Division will be particularly focused on investigating and prosecuting, while also emphasizing the Division’s willingness to reduce criminal and civil sanctions when corporations self-disclose and cooperate with the government.
Overall, the memorandum describes enforcement priorities and associated policies that align with the Trump administration’s focus on rooting out government waste and abuse, toughening U.S. policy on foreign trade and combatting national security concerns such as drug trafficking and foreign crime organizations, citing to several executive orders on these topics.
The Criminal Division’s “Areas of Focus” include:

Federal program fraud, waste and abuse—specifically health care fraud and procurement fraud;
Trade and customs fraud, including tariff evasion;
Fraud perpetrated through variable interest entities (VIEs), including schemes targeting elders, “ramp and dumps,” and other forms of market manipulation;
Fraud that victimizes U.S. investors, individuals and markets, such as Ponzi schemes, schemes targeting elders and servicemembers and fraud that threatens consumer health and safety;
Financial institutions that commit sanctions violations or enable transactions by Transnational Criminal Organizations (TCOs), drug cartels, hostile nation-states and/or foreign terrorist organizations;
Corporations that provide “material support” to foreign terrorist organizations, cartels and TCOs;
Complex money laundering schemes—specifically referencing “Chinese Money Laundering Organizations” and other organizations involved in laundering money used in the manufacturing of illegal drugs;
Violations of the Controlled Substances Act and the Federal Food, Drug, and Cosmetic Act, including the unlawful manufacture and distribution of products used to create counterfeit pills containing fentanyl and the unlawful distribution of opioids by medical professionals and companies;
Bribery that impacts U.S. national interests, undermines U.S. national security and harms the competitiveness of the U.S.; and
Crimes involving the use of digital assets—with cases impacting victims, involving cartels, TCOs, or terrorist groups or facilitating drug money laundering or sanctions evasion receiving the highest priority.

After outlining the Criminal Division’s investigation and prosecution priorities, the memorandum indicates that the Department will take a more relaxed approach to misconduct committed by corporations that are willing to report such conduct, cooperate with the government and take actions to remediate the misconduct. In fact, these are factors that Criminal Division prosecutors must now consider when determining whether to bring criminal charges against corporations.
The memorandum further states that the Division’s Corporate Enforcement and Voluntary Self-Disclosure Policy will be revised to clarify additional benefits that are available to companies that self-disclose and cooperate with the government and will provide a “more easily understandable” path for declination and fine reductions. As part of this effort, the Criminal Division’s Fraud Section and Money Laundering and Asset Recovery Section have been instructed to review all existing corporate compliance agreements to determine if they should be terminated early. Facts that these Sections may consider when determining whether early termination is warranted include the duration of the post-resolution period, a substantial reduction in the company’s risk profile, the extent of remediation and maturity of the compliance program and whether the company self-reported the misconduct.
Additionally, Division attorneys must consider several factors when imposing terms for corporate compliance agreements, including the severity of the misconduct, the company’s degree of cooperation and remediation and the effectiveness of the company’s compliance program at the time of resolution. The memorandum provides that the terms of such agreements should not exceed three years “except in exceedingly rare cases,” and Division attorneys should assess these agreements regularly to determine if they should be terminated early.
Lastly, the memorandum provides policy changes with respect to the use of independent compliance monitors. Namely, the Division will only impose such monitoring when necessary, for example, when a company cannot be expected to implement an effective compliance program or prevent recurrence of the underlying misconduct, and the monitoring must be narrowly tailored to minimize expense, burden and interference with business.
Mr. Galeotti discussed these policy changes while speaking at the Securities Industry and Financial Markets Association’s Anti-Money Laundering and Financial Crimes Conference on May 13, 2025, stating that companies will now have a “clear path to declination” through self-disclosure, full cooperation with the government and timely remediation. Galeotti stated that even companies with aggravating circumstances may receive declination if the company’s cooperation and remediation outweigh these circumstances. Furthermore, Galeotti indicated that even companies that self-disclose after the government has become aware of their misconduct can still qualify for shorter-term compliance agreements, fine reduction and lessened monitoring.
Taken together, this memorandum and other guidance issued by DOJ under the direction of U.S. Attorney General Pam Bondi, indicate that the Department intends to treat corporate misconduct outside certain areas of focus with a lighter hand, incentivizing corporations to be transparent with the government and, as stated in the Division’s memorandum, “learn from their mistakes.”

“AI Policy Roadmap” Released by AdvaMed to Guide Regulators

On March 14, 2025, AdvaMed, the MedTech Association, released its AI Policy Roadmap (the Roadmap) outlining policy priorities for Congress and the U.S. Food and Drug Administration (FDA). The impetus for the Roadmap was the recognition of the important role that AI-enabled devices will play in improving the accuracy and efficiency of disease diagnosis, enabling higher quality treatments, and expanding access to health care and to innovative technologies. The Roadmap is broken down into three main policy priority areas: privacy and data access, FDA AI regulatory framework, and reimbursement and coverage.
Privacy and Data Access
The Roadmap contends that one component of AI-enabled devices that sets them apart from traditional technology is the need for large datasets to train and validate the algorithms underlying the devices. The need for large datasets creates two distinct challenges.

First, health care data is highly fragmented and generally stored in non-standardized formats. Health care data is not frequently shared across health systems, and there are very few commercial vendors that provide the services necessary to link and standardize this data.
The second significant challenge is the need to protect patient privacy and ensure that data security is prioritized. To this end, the Health Insurance Portability and Accountability Act of 1996 (HIPAA) requires protection of certain types of personal health information, consent to use and/or disclose data, and strict deidentification requirements when personal health information is used. The need for high quality data measured against the need to protect patient privacy creates an inherent tension in policy priorities.

To mitigate this tension, the Roadmap provides three recommendations:

Congress and regulatory agencies such as the FDA should ensure data protection without stifling innovation.
Congress should evaluate the need to update HIPAA for the AI era and create clear guidelines specifically for data use in AI development.
Congress and regulatory agencies should develop appropriate guidelines around patient notice and authorization for the data used to develop AI.

The Roadmap strives to balance the need for a high volume of high quality standardized data with patient privacy by placing modernized consent and notification requirements at the center of the policy priorities. Recognizing the need for large datasets, the Roadmap emphasizes modernizing traditional privacy policies, such as HIPAA, to accommodate data use and collection for AI models.
FDA AI Regulatory Framework
The FDA regulates certain AI-enabled devices for safety and efficacy. However, AI-enabled devices require a different approach than FDA’s “traditional” medical device review model for those devices that undergo changes in an iterative fashion. For approved medical devices that evolve continuously, e.g., AI-enabled devices, developers must submit for FDA review any modification that could significantly affect the product’s safety or effectiveness, consistent with FDA-drafted guidance on the preapproval process for post-market changes – referred to as predetermined change control plans (PCCP). These post-market changes occur as algorithms continue to learn and validate against the data of the populations using the technology. The algorithms then adjust based on continued learning. While Congress passed legislation authorizing PCCP approval in 2022, comprehensive FDA PCCP guidance was only released in December of 2024. The complete pre- and post-market processes for AI-enabled devices are outlined in the FDA’s “Artificial Intelligence-Enabled Device Software Functions: Lifecycle Management and Marketing Submission Recommendations.”
The Roadmap’s recommendations suggest that FDA modernize regulations to align with the increasing shift from traditional medical devices to AI-enabled devices. Specifically, the Roadmap recommends that:

The FDA should remain the lead regulator responsible for overseeing the safety and effectiveness of AI-enabled medical devices.
The FDA should implement the existing PCCP authority to ensure it achieves its intended purpose of ensuring patients have timely access to positive product updates.
The FDA should issue timely and current AI guidance documents related to AI-enabled devices and to prioritize the development and recognition of voluntary international consensus standards.
The FDA should establish a globally harmonized approach to regulatory oversight of AI-enabled devices.

The Roadmap commends progress made by Congress and the FDA to modernize legislative and regulatory processes applicable to AI-enabled devices but urges continued focus on keeping pace with technological innovation. The focus of the policy recommendations is on streamlined, uniform regulations that are not overly burdensome and will not stifle innovation.
Reimbursement and Coverage
Finally, the third policy area addressed in the Roadmap is reimbursement and coverage as a critical component of increasing access to digital health technologies. Currently, reimbursement for AI-enabled devices has been considered on a device-specific basis, leading to incremental policy changes. The Roadmap suggests that Medicare, as the country’s largest health care payor supporting the medical needs of millions of Americans, could be instrumental in shifting this policy position. Further, Medicare policy initiatives heavily influence the coverage policies of private payors and state Medicaid plans. While the Roadmap acknowledges that there is no one single policy solution to increase accessibility to digital health technology through reimbursement, “accurately capturing the cost and value of [AI-enabled devices] is critical to ensuring appropriate reimbursement.”
Toward this end, the Roadmap provides five policy suggestions:

Congress should consider legislative solutions to address the impact of budget neutrality constraints, or restraining Medicare spending to a certain defined threshold, on the coverage and adoption of AI technologies.
The Centers for Medicare & Medicaid Services (CMS) should develop a formalized payment pathway for algorithm-based health care services to ensure future innovation and to protect access to this subset of AI technologies for Medicare beneficiaries.
To ensure future innovation and to protect access to algorithm-based health care services for Medicare beneficiaries, CMS should develop a formalized payment pathway for algorithm-based health care services.
Congress and the FDA should facilitate the adoption and reimbursement of digital therapeutics through legislation and regulation.
CMS should leverage its authority to test innovative alternative payment models to promote the ability of AI technologies to improve patient care and/or lower costs.

The development and adoption of AI-enabled devices to improve diagnosis, treatment, and patient care will be amplified by the adoption of appropriate reimbursement policies as health care providers and practitioners will be more readily able to learn about and use these health care tools. Sound reimbursement and coverage policies are an integral part of supporting innovation and development of AI-enabled health care devices.
Conclusion
In a recent press release, Scott Whitaker, AdvaMed CEO and President said about the release of the Roadmap, “The future of AI applications in medtech is vast and bright. It’s also mostly to be determined. We’re in an era of discovery… This is the right time to promote the development of AI-enabled medtech to its fullest potential to serve all patients, regardless of zip code or circumstance.” It is from this position of promoting new technology that AdvaMed urges Congress and the Food and Drug Administration to act in support of the development of AI-enabled medical technology.

Missouri Legislature Passes Bill to Repeal Earned Paid Sick Time Law

On May 14, 2025, the Missouri General Assembly passed House Bill (HB) 567, which would repeal the Missouri paid sick time statute and eliminate Missouri employers’ obligation to provide earned paid sick time to all Missouri employees.

Quick Hits

The Missouri paid sick time statute requires Missouri employers to provide earned paid sick time, starting May 1, 2025.
On May 14, 2025, the Missouri General Assembly passed HB-567, which would repeal the paid sick time statute. If signed by the governor, the law will be repealed effective August 28, 2025.

Proposition A, which Missouri voters passed via a ballot measure on November 5, 2024, includes a provision that raises the state’s minimum wage as of January 1, 2025, and requires employers to begin providing earned paid sick time (PST) on May 1, 2025. In addition to repealing the state paid sick time law, HB-567 would amend the minimum wage statute.
The Missouri Paid Sick Time Law
Under the current paid sick time law, most Missouri employers must provide earned paid sick time to employees working in Missouri starting May 1, 2025. The law exempts employers that are federal, state, or local governments or political subdivisions of the state. The statute also excludes some categories of workers, such as volunteers, camp counselors, babysitters, golf caddies, some rail carrier employees, and retail employees of businesses with annual gross volume sales of less than $500,000. The law does not apply to employees covered by a collective bargaining agreement (CBA) that was in effect on November 5, 2024, until the CBA is amended, extended, or renewed.
The current PST law allows Missouri employees to:

earn one hour of earned paid sick time for every thirty hours worked;
use PST for an employee’s own illness or medical reasons, illness/medical reasons of an immediate family member, closure of the employer’s business or the employee’s child’s school, and absences due to sexual assault or domestic violence;
use PST in increments of one hour;
use up to fifty-six hours of PST for covered reasons;
carry over up to eighty hours of unused PST at year-end; and
use PST without discipline or retaliation for covered use.

Repealing the Missouri PST Statute
HB-567 passed without an emergency clause because the emergency clause was defeated in the Missouri House of Representatives when it did not receive the requisite two-thirds approval before moving to the Senate. The emergency clause would have allowed the repeal to become effective immediately upon signature by the governor. The bill would take effect on August 28, 2025.
If the bill is signed into law, there will be a seventeen-week period from May 1, 2025, to August 28, 2025, during which Missouri employers must comply with the current PST law. Many employers may want to implement a temporary policy to cover the period when the PST law is still in effect. For employers that have a paid-time-off (PTO) policy that meets all the requirements of the statute, no additional PTO policy is necessary.
Key Takeaways
Missouri employers must provide earned paid sick time to eligible Missouri employees while the law is in effect. If the governor signs HB-567, employers may want to implement a short-term policy to provide the required PST benefits from May 1, 2025, to August 28, 2025. Additionally, employers may want to consider how to use an existing PTO policy for short-term compliance and address what will happen to earned PST upon repeal of the law.