Class Action Litigation Newsletter | Autumn 2025
This GT Newsletter summarizes recent class-action decisions from across the United States.
Highlights from this issue include:
Second Circuit affirms denial of a motion to compel arbitration when plaintiff received notice after the transaction through a “welcome kit,” which did not make the terms clear and conspicuous.
Second Circuit reminds district courts that class settlement approval under CAFA requires them to consider allocation of recovery between class counsel and the class.
Third Circuit, Fourth Circuit, and Ninth Circuit affirm denial of class certification in cases alleging that insurers underestimated the actual cash value of totaled vehicles because the fact of damages was individualized.
Fourth Circuit affirms remand based on CAFA’s local-controversy exception, clarifying standard for showing that more than two-thirds of putative class members are citizens.
Fourth Circuit holds that South Carolina’s “door closing statute” does not control over Rule 23 in a putative class action involving proposed nationwide class allegations.
Fourth Circuit affirms denial of certification in a TCPA based on plaintiff’s failure to prove an ascertainable class of call recipients.
Fifth Circuit holds that only the named plaintiff’s standing is to be considered at the class certification stage.
Ninth Circuit holds that plaintiff’s lack of equitable standing is grounds for remand, but defendant can waive this issue to keep case in federal court.
Continue reading the full GT Class Action Litigation Newsletter | Autumn 2025
Kara E. Angeletti, Angela C. Bunnell, Gina Faldetta, and Gregory Franklin contributed to this article
Diagnosing Health Care- 42 CFR Part 2 Final Rule- What’s Changing and What Do You Need to Know? [Podcast]
By early 2026, substance use disorder (SUD) providers, health plans, clinicians, health information exchanges (HIEs), and vendors must meet new federal privacy standards for SUD treatment records or face Health Insurance Portability and Accountability Act (HIPAA)-level enforcement and penalties.
On this episode, Epstein Becker Green attorneys Lisa Pierce Reisz, David Shillcutt, and Laura DePonio join Nichole Sweeney, General Counsel and Chief Privacy Officer at CRISP, to break down the 42 CFR Part 2 final rule: what’s changing, what’s staying the same, and what organizations often miss.
The group explains how the final rule aligns with (but does not replace) HIPAA, why patient consent remains central, and what new operational risks are emerging.
Key Takeaways:
Adoption of HIPAA Penalties: Part 2 now adopts HIPAA’s enforcement and penalty structure.
Operational Readiness Challenges: Operational readiness, not technology, is the biggest challenge.
Expanded Compliance Duties: Payors and HIEs face major shifts in data access and compliance duties.
Tune in to learn about the changes that matter most and the risks you can’t ignore.
CMS Expands Consequences of Medicare Revocation- What You Need to Know
Key Takeaways
CMS maintains its authority to impose Medicare reenrollment bars: CMS emphasizes its ability to apply reenrollment bars when a provider’s Medicare billing privileges are revoked, affecting all enrollments linked to the provider’s TIN.
Certain revocation types may trigger narrower reenrollment bars: CMS may limit a bar to the specific revoked enrollment but warns against attempts to re-enroll under new names or entities.
Medicare providers should act quickly after a revocation: Providers should consider timely appeals to help avoid the business disruption of a reenrollment bar, particularly in Medicare-dependent sectors.
In late September, the Centers for Medicare and Medicaid Services (CMS) proposed updates to Chapter 10 of the Medicare Program Integrity Manual (PIM), clarifying how reenrollment bars apply when a provider’s Medicare billing privileges are revoked. The changes were set to take effect Oct. 20, but — likely due to the government shutdown — have not yet been officially incorporated.
The guidance clarifies that as a general rule, reenrollment bars will apply to “all enrollments under the provider’s PECOS or legacy enrollment record at the TIN level.”1 Once implemented, the new guidance will expand and clarify CMS’ authority to restrict reenrollment bars in certain cases.
When Can CMS Limit a Reenrollment Bar?
CMS identifies in the guidance specific revocation instances that require special consideration and review, allowing CMS to potentially limit a reenrollment bar to only the specific enrollment that was revoked. These revocations include those based on:
Noncompliance with enrollment requirements
Failure to satisfy onsite review or nonoperational
Failure to meet financial screening requirements
Failure to report accurate information on provider
Failure to meet Medicare documentation or access requirements
Failure to maintain documentation of reserve operating funds
Supplier standard or condition violation (only applicable to certain suppliers)
In these circumstances, although the reenrollment bar is limited “only to the specific enrollment that was the subject of the reenrollment bar,” CMS cautions that “if there is any effort to re-establish a revoked enrollment(s) under a different name, numerical identifier or business entity,” the Medicare Administrative Contractor reviewing the application must contact CMS for further guidance.2
What Scenarios Does CMS Flag as Attempts to Reenroll After a Bar?
This new guidance includes clarifying examples of situations where a provider may be attempting to circumvent a reenrollment bar by enrolling under different circumstances:
Scenario 1: Smith was the sole owner of XYZ Medical Supplies, Inc. XYZ’s lone location was at 1 Jones Street. XYZ’s billing privileges were revoked after it was determined that the site was nonoperational. Nine months later, the contractor receives an initial application from Johnson Supplies, LLC. The entity has one location at 1 Jones Street in the same city in which XYZ Medical Supplies is located. Smith is listed as a 75% owner.
Scenario 2: Jones and Smith were 50% owners of World Home Health, a partnership. One year after World Home Health was revoked under § 424.535(a)(9), the contractor receives an initial application from XYZ Home Health, a corporation of which Jones is the sole owner/member.
What Can Providers Facing a Medicare Reenrollment Bar Do?
Reenrollment bars can carry significant barriers to continuing a business in a Medicare-dominated industry. Where possible, providers facing revocations should consider appeals of a revocation to prevent a reenrollment bar.
[1] PIM, 10.4.7.4.C.1.
[2] PIM, 10.4.7.4.C.2.
CMS Tests Prior Authorization for Ambulatory Surgery Centers: Preparing for the 2025 Demonstration
Overview
CMS is launching a five-year Prior Authorization Demonstration for certain ambulatory surgical center (ASC) services beginning December 15, 2025, in 10 states, including Georgia, Florida, and Tennessee. The model will require ASCs to obtain prior authorization before performing selected procedures that CMS views as high-growth or medically variable — such as blepharoplasty, botulinum toxin injections, panniculectomy, rhinoplasty, and vein ablation.
The initiative tests whether early review can curb unnecessary procedures, reduce claim denials, and streamline Medicare payments. For hospitals and surgery-center operators, it represents a clear signal: CMS is shifting oversight from post-payment audits to pre-service accountability.
Key Details
Effective date: December 15, 2025
Duration: Five years
States: CA, FL, GA, MD, NY, OH, PA, TN, TX, AZ
Administered by: Regional Medicare Administrative Contractors (MACs)
Applies to: Select outpatient surgical procedures performed in ASCs (generally cosmetic-type procedures)
Each request must include documentation establishing medical necessity under existing Medicare coverage rules. MACs will issue an affirmed, non-affirmed, or partially affirmed decision. Procedures performed without an affirmed tracking number may be denied or delayed in prepayment review.
Operational Impact
Scheduling and Billing Integration
Prior authorization becomes a front-end requirement. Surgery scheduling, clinical documentation, and billing workflows must now communicate in real time to capture authorization status and unique tracking numbers.
Documentation and Staff Training
Incomplete documentation will be the leading cause of delay. ASC staff and surgeons should review documentation templates, update EHR workflows, and train schedulers on the new submission process.
Patient Communication
Patients may experience scheduling delays during the initial rollout. Transparent communication — explaining that CMS now requires pre-approval — will help manage expectations and preserve satisfaction.
Compliance Risk
Performing procedures without affirmed authorization could create repayment or False Claims Act exposure. Systems should document decision letters and maintain audit trails for every case.
Regional Readiness
The Southeast’s inclusion in this demonstration is deliberate. States like Georgia and Florida have some of the nation’s fastest ASC growth, often through hospital-physician joint ventures. CMS will closely observe whether these markets can meet documentation standards while maintaining timely access to care.
For health systems, this is an opportunity to build scalable workflows now. Integrated scheduling dashboards, centralized pre-authorization teams, and standardized physician documentation can turn compliance into a competitive advantage when the program expands nationally.
Legal and Appeals Notes
CMS has indicated that denials under the demonstration will still be eligible for appeal through standard Medicare channels. However, because the review happens before payment, cash-flow impact will be immediate. Hospitals and ASCs should map appeal workflows in advance and clarify contractual responsibility for documentation between facilities and employed or affiliated surgeons.
Preparing for December 2025
Inventory affected procedures and identify frequency by site.
Review MAC guidance and determine documentation requirements.
Train surgical and revenue-cycle teams on submission and tracking.
Develop metrics for approval rates, turnaround times, and denials.
Coordinate with compliance to ensure pre-authorization records are retained.
Why It Matters
This demonstration marks the latest step in CMS’s broader move toward front-end validation and real-time accountability. The agency wants to know not only what was billed, but why — before the claim is paid.
For providers, the demonstration may feel like one more administrative hurdle. But it also offers a chance to build stronger processes that reduce downstream denials and prepare organizations for the next generation of value-based payment.
For patients, the outcome will depend on execution: If ASCs communicate clearly and coordinate well, this could actually make care faster and safer by reducing post-service disputes.
Mandatory participation may offer a strategic advantage. Success here will set the benchmark for how outpatient surgery oversight evolves nationwide.
Want to Go Deeper?
We’ve prepared a set of ASC Prior Authorization Readiness Toolkits designed to help systems operationalize these changes, including appeals mapping and compliance tracking. Please reach out directly for a copy of these resources and to discuss how they can be customized for your organization’s needs.
Listen to this article
Answering the Call for Prior Authorization Reform
For patients and providers alike, prior authorization remains one of the most persistent pain points in healthcare. A recent Kaiser Family Foundation poll found that most patients struggle to navigate the process, and many delay or forgo care altogether. Clinicians say the administrative burden is not only draining but financially unsustainable, as providers absorb rising costs tied to staff hours, inconsistent documentation requirements, and repeated submissions for a single treatment.
In response to mounting frustration, both policymakers and industry leaders are touting reform. According to MultiState, nearly half of US states have introduced legislation over the past year to make prior authorization more transparent and predictable. Many of these laws would require human clinical review of denials, faster turnaround times, and “gold card” exemptions for providers with strong approval histories. On paper, these changes could meaningfully reduce delays and paperwork.
Yet skepticism remains over whether insurers will follow through. Even as payers pledge to modernize their systems, adoption of reforms has often lagged. Efforts to standardize criteria or expand electronic prior authorization (ePA) remain uneven, and implementation timelines stretch across years. And at the same time, many plans are outsourcing larger segments of utilization management to third-party administrators (TPAs) for specific services, creating yet another layer of review that further complicates and slows approvals. Provider groups caution that without consistent enforcement, reforms risk becoming minor improvements rather than systemic change.
However, some promising signs are emerging; Johns Hopkins University recently convened payers, providers, and technology experts to build consensus on automation and transparency, while pharmacy and medical leaders continue to push for real-time ePA tools. Still, questions linger about how quickly plans will embrace these shifts or find new tools that delay care.
Ultimately, meaningful progress will depend on whether insurers are willing to relinquish some control in favor of patient-centered efficiency. Policymakers may have set the stage, but only sustained oversight will turn reform goals into real-world results.
A New Deal For GLP-1s
The Trump Administration recently announced a multi-pronged deal with Eli Lilly and Novo Nordisk aimed at lowering the cost of GLP-1 medications used for weight loss and diabetes. While many details remain in flux, the proposed framework will impact GLP-1 coverage for certain Medicare and Medicaid beneficiaries and pricing for cash-pay individuals.
For Medicare and Medicaid beneficiaries, the deal proposes to:
offer injectable GLP-1 medications from Eli Lilly and Novo Nordisk for $245/month for weight loss and diabetes. Medicare beneficiaries will have a $50 copay, whereas Medicaid beneficiaries will have no copay or otherwise a very limited out-of-pocket cost; and
if new oral pill versions of the GLP-1 medications are approved by the U.S. Food & Drug Administration (“FDA”), offer these pills at their lowest doses for $149/month.
Today, Medicare already covers GLP-1s for diabetes and for cardiovascular risk reduction, and Medicaid covers the same for those that qualify based on level of income and resources. Under the deal, the coverage under both programs would expand to include patients with obesity who are considered to be at high metabolic or cardiovascular risk. Many patients who would qualify under these new criteria may already meet current coverage conditions, so the number of people who would be newly eligible is uncertain, although the administration estimates that roughly 10 percent of the Medicare and Medicaid population will be eligible under the expanded access. The administration is aiming to make this new coverage available to Medicare beneficiaries by mid‑2026. It is unknown at this time when the Medicaid coverage would begin.
In addition to Medicare and Medicaid expansion, the administration also announced that TrumpRx could offer a new, lower-cost pathway to GLP-1s for cash-pay patients beginning in January 2026 (although the launch timeline and operational details are far from settled). For those unfamiliar with TrumpRx, the platform (which has yet to be officially launched) will aim to connect patients directly with better priced drugs and, in doing so, increase transparency in drug pricing and cut out potentially costly third-party markups. Under TrumpRx, Wegovy and Zepbound will purportedly be sold directly to patients at prices that will start around $350/month, with a potential to scale down to $250/month over the next two years. Similar to the benefits offered under Medicare and Medicaid, if new pill versions are approved by FDA, Eli Lilly and Novo Nordisk have agreed to offer them to TrumpRx patients at $149/month at their lowest doses. It remains unclear how these pricing plans will impact LillyDirect and NovoCare.
In exchange for lowering prices, Eli Lilly and Novo Nordisk each received one of FDA’s “national priority vouchers.” In tandem with the November 6 announcement, FDA announced that Oral Semaglutide (Novo Nordisk’s GLP-1 tablet) and Orforglipron (Eli Lilly’s GLP-1 tablet), both intended for weight loss, would get accelerated review through the voucher program, which promises review and decision within two months or less. The drug manufacturers will also be granted relief from tariffs (a so-called three year “grace” period) if they follow through on their commitments to boost domestic manufacturing.
Missing from this announcement is any discussion about commercial coverage. More than half of U.S. residents are covered by private insurance, and many plans have been reluctant to broadly cover GLP‑1s because of the high costs. Eli Lilly and Novo Nordisk have generally committed to lowering the cost of the drugs for commercial insurers, but at the time of the announcement no further details were provided as to specific changes related to private insurance.
Many industry questions remain open, such as whether this deal will have any impact on commercial insurance coverage and how (and when) cash-pay patients can expect to benefit from the new pricing scheme. We will continue monitoring implementation timelines, FDA decisions on pill formulations, and how stakeholders respond to the evolving price landscape.
Shannon E. McClure contributed to this article
Missouri Court of Appeals Finds No Duty to Defend or Indemnify in Class Action Involving Environmental Contamination Beginning in the 1960s
A recent Missouri Court of Appeals decision provides helpful precedent for liability insurers facing legacy environmental claims and class actions. The court strictly construed the policy period, concluding that claims based on conduct or injury occurring after the expiration of the policy were not covered, even if the underlying contamination began earlier.
In Certain Underwriters at Lloyd’s London v. Northrup Grumman Corporation, –– S.W.3d ––, 2025 WL 3072808 (Mo. App. Nov. 4, 2025), the underlying class action alleged that waste containing trichloroethylene (TCE) and other contaminants migrated from a site previously operated by Litton Industries (later acquired by Northrop), contaminating private wells in the area. The federal court dismissed most of the claims, and the parties settled the remaining claims.
Northrop sought coverage for the settlement under a Lloyd’s policy in effect from 1964-1967 and a Wausau policy in effect from 1969-1971. Both policies covered “all sums which the Insured shall become legally obligated to pay as damages because of either ‘property damage’ or ‘personal injury.’” Based on the policy language quoted in the opinion, neither policy specified what conduct needed to happen during the policy period to trigger coverage. The class action plaintiffs alleged that Northrop, after acquiring Litton in 2001, failed to warn, monitor, or remediate TCE contamination, resulting in injuries to property owners from 2004 onward.
The Missouri Court of Appeals affirmed the trial court’s conclusion that the insurers had no duty to defend or indemnify Northrup. The court explained that the class was “people who were harmed from 2004 through the present,” and their claim was “that Northrup knew as of at least 2004 that TCE contamination had spread, but did not warn the public.” There was thus no potential coverage under the 1960s/1970s-era policies. Despite Northrup’s efforts to tie the claims to the original contamination, the court explained that “[t]he London Policy and Wausau Policy only provide coverage for injury or damage that occurs during the policy period,” and “[t]he Class Action Plaintiffs alleged that they were injured from Northrup’s actions when Northrup failed to monitor the spread of TCE, failed to warn about TCE, failed to remediate TCE, and failed to stop the spread of TCE,” all of which “occurred outside the policy period.”
This decision underscores that coverage is strictly tied to the policy period—a helpful precedent in defending against attempts by policyholders to expand coverage for legacy liabilities.
Minnesota’s New Paid Leave Law Is Here- What Employers Need to Do Before January 1, 2026
In 2023, Minnesota enacted legislation creating a statewide Paid Family and Medical Leave program (the “Program”), which is set to take effect on January 1, 2026. The law established a publicly administered insurance program that is funded through employer and employee payroll contributions. This change aligns Minnesota with a growing number of states implementing similar programs at the state level.
Overview of the Program
Under the Program, eligible employees may take:
up to 12 weeks of paid medical leave for their own serious health condition;
up to 12 weeks of paid family leave for family care, such as bonding with a new child, caring for a family member with a serious health condition, certain military exigencies, and safety leave for issues related to domestic violence; and
a maximum of 20 weeks of combined leave per benefit year.
Employers and employees will share the cost of the Program in the form of premiums on employee wages. Employers must cover a minimum of 50% of the premium and may deduct the remainder of the premium from employee pay. The Program also provides businesses with existing paid leave benefits the opportunity to apply for approval to use a private plan in lieu of the state program, provided the private benefits are equivalent or better.
Key Steps for Employers Before January 1, 2026
As the January 1, 2026, effective date approaches, employers should begin taking steps to prepare for the Program.
Decide State or Equivalent Private Plan – Recommended by November 15, 2025Employers should decide whether they prefer to participate in the state plan or whether they would rather fulfill their obligations with an equivalent private plan that matches or exceeds state program coverage and does not cost employees more than they would be required to contribute under the state plan. The latter requires (i) annual renewal, (ii) a $500 annual fee based on headcount, (iii) and a surety bond or insurance carrier policy. If an employer submits their request after November 15, 2025, the earliest the equivalent plan can start is April 1, 2026.
Determine Premium AllocationsEmployers should also decide what portion of the premium rate is going to be paid by the employer and what portion will be deducted from the employee’s pay. For 2026, the premium rate is 0.88% of an employee’s taxable wages.[1] The rate is set annually, cannot exceed 1.2% of an employee’s taxable wages, and is not adjusted for individual employers based on their employees’ utilization of the Program. For 2026, employers are responsible for at least 0.44% (i.e., 50% of the premium), and employees will pay anywhere between 0.00 and 0.44% of the premium, so long as the deduction does not reduce an employee’s pay below minimum wage.
Notify Employees – Required by December 1, 2025Employers must display Paid Leave workplace posters in English and any other language spoken by five or more employees or independent contractors. Additionally, employers must provide individual notice of the paid leave program to employees[2] in their primary language — including the employer-determined premium allocations. This notice can be delivered through a physical read-and-sign copy or virtually via a payroll system. Employers must obtain signed written or electronic acknowledgment of receipt from employees.
Prepare for Quarterly Wage ReportingFinally, employers must be prepared to submit wage reports on a quarterly basis. In most cases, employers will not need to take any additional steps to meet this requirement because the state will use the existing Unemployment Insurance (UI) system to collect wage detail reports for Paid Leave. If all employees are covered by UI, the employer’s current UI account will automatically be converted to a joint UI and Paid Leave account, and their quarterly wage detail reports (which they are already submitting) will now serve both UI and Paid Leave.
Next Steps for Employers
By the year-end of 2025, Minnesota employers should work with counsel to determine plan participation, premium allocation, and compliance with Paid Leave program requirements to ensure compliance by January 1, 2026.
[1] Small employers (employer with 30 or fewer employees) have a smaller premium rate of 0.66%.
[2] New employees hired after December 1, 2025 must receive the individual notice within 30 days of hire.
CMS Finalizes Sweeping Reforms to Skin Substitute Payments Amid Rising Costs and Enforcement Activity
Key Takeaways:
Major Financial and Operational Impact: On Nov. 5, 2025, CMS finalized a rule that fundamentally changes Medicare payment methodology for a broad range of skin substitute products used for wound care. Beginning in January 2026, most skin substitute products will shift from average sales price (ASP)-based payments to a flat, standardized rate. For 2026, that rate is $127.28/cm2 — likely reflecting a major payment cut for most products.
Heightened Enforcement: With significant increases in spending over the past several years, wound care and skin substitutes have been in the spotlight for regulators. Despite the change in payment methodology, enforcement activity is likely to continue, with a focus on medical necessity of treatments and pricing.
Starting Jan. 1, 2026, Medicare will overhaul how it pays for most skin substitute products, moving from ASP-based reimbursement to a standardized flat rate of $127.28/cm². The change, finalized Nov. 5, 2026, comes as regulators sound the alarm over skyrocketing costs, suspected profiteering and a sharp rise in enforcement. The new model is likely to create financial strain for providers and manufacturers alike, even as federal scrutiny shows no signs of slowing.
Background
In recent years, skin substitutes have become a growing area of government focus. On Nov. 5, 2025, Centers for Medicare and Medicaid Services (CMS) published a final rule implementing sweeping changes to the Medicare Part B payment methodology for skin substitutes— marking the most significant shift in this product category in over a decade. The new rule takes effect on Jan. 1, 2026.
CMS cited “dramatic” increases in spending and launch prices for skin substitutes as a motivation for the change, attributing it in part to industry “profiteering” and other potentially abusive practices. According to the final rule, “Part B spending for these products rose from approximately $250 million in 2019 to over $10 billion in 2024, a nearly 40-fold increase, while the number of patients receiving these products only doubled.”
The HHS Office of Inspector General (OIG) has also flagged this trend, publishing two reports: one in 2023 that identified inconsistent reporting of pricing data by manufacturers and a second in September 2025, warning of the risk of fraud and abuse associated with the Medicare payment methodology for skin substitutes. In particular, OIG warned that the ASP-based methodology could yield a substantial “spread” for physicians — because Medicare often pays providers significantly more than the purchase price for the products.
The Department of Justice (DOJ) has also ramped up enforcement. Recent actions in the wound care space focused on orders of medically unnecessary skin substitutes and kickbacks in violation of the Federal Anti-Kickback Statute (AKS). For example, in 2024, an Arizona couple pleaded guilty to orchestrating more than $1.2 billion of false and fraudulent claims related to unnecessary wound grafts. According to court filings, the defendants instructed and financially incentivized sales representatives to order wound grafts only in larger sizes to maximize reimbursement, regardless of clinical need. In exchange for these orders, the defendants allegedly received over $279 million in illegal kickbacks from the product distributor and paid sales representatives tens of millions in unlawful commissions.
More recently, on June 30, 2025, the DOJ announced the 2025 National Health Care Fraud Takedown, a nationwide operation that included criminal charges against seven individuals in connection with $1.1 billion in allegedly fraudulent Medicare claims for skin substitutes. The cases again center on medically unnecessary skin substitutes and kickback schemes. Notably, some of the individuals charged are health care professionals accused of prescribing skin substitutes in exchange for kickbacks — signaling that physicians and other health care professionals may be targets of continued enforcement in this area.
What’s Changing
Under the existing model, skin substitutes are paid under Medicare Part B as biologics, using the average sales price ASP + 6% methodology, with each product separately coded and priced. When the final rule goes into effect in January, Medicare will pay for skin substitutes based on a product’s regulatory status.
Biological products licensed under Section 351 of the Public Health Service Act (PHS Act) will continue to be paid as biologicals under the ASP methodology.
Most other skin substitutes will be reimbursed as “incident to” supplies under the physician fee schedule and subject to a flat payment rate. This change applies to skin substitutes in three regulatory categories: (1) devices subject to premarket approval (PMA); (2) devices subject to 510(k) clearance; and (3) human cells, tissues and cellular and tissue-based products (HCT/Ps) regulated under Section 361 of the PHS Act. For 2026, all three product categories will be paid under Medicare Part B at a rate of $127.28/cm2. In future years, CMS intends to set different payment rates for each bucket based on pricing data it collects from manufacturers and hospitals.
For most products, CMS is retaining the current HCPCS codes for these products and applying the new payment rate. For skin substitute products not in sheet form (e.g., gels, powders, liquids, injectables, 3D-printed constructs, etc.), CMS is retaining the current coding and directing MACs to determine appropriate payment.
This new rule implements a consistent approach across the physician office and hospital outpatient setting, although CMS signaled possible future changes.1
Implications for Stakeholders
The shift to a flat-rate payment model carries broad implications for physicians, clinics and manufacturers. Most immediately, the new flat rate may not fully cover acquisition and application costs for physicians and other wound care providers — especially for higher priced or complex products — and it may not adequately cover practice overhead expenses. Many providers will need to tighten inventory management to minimize losses from expired or unused products. Rural and lower volume clinics, in particular, may find it difficult to continue offering advanced wound care treatments, potentially limiting patient access.
On the manufacturing side, the new model will require companies to revisit pricing strategies in light of the new payment methodology. At the same time, continued regulatory scrutiny raises the stakes for everyone in the supply chain. With CMS, OIG and DOJ both focused on this space, manufacturers, distributors and health care providers are all potentially targets of enforcement.
Footnotes
[1] “Depending on the outcomes of this final policy, we may consider packaging skin substitute products with the related application procedures in both the hospital outpatient setting and non-facility setting in future rulemaking.”
Patients Over Profit Act – A Federal Inflection Point on Insurer-Provider Integration and What Comes Next
For years, the conversation around health insurer consolidation and vertical integration has simmered through antitrust inquiries, oversight hearings, and policy papers. The Patients Over Profit Act (the “POP Act”)[i], introduced in both chambers of Congress this fall, marks a decisive shift. Rather than regulating insurer-provider integration, the POP Act proposes to ban it outright.
If passed, the POP Act would fundamentally reshape how Medicare dollars move through the U.S. healthcare system, not by adjusting incentives or introducing new reporting rules, but by redrawing the structural map itself. The POP Act draws a bright, enforceable line that prohibits common ownership or control between health insurers and physician or certain outpatient provider entities that bill Medicare Part B or participate in Medicare Advantage (MA) plans. That is a direct challenge to the model that has defined the past decade of health system strategy: vertical integration.
Vertical integration has historically been viewed as a potential strategy to control healthcare costs, align clinical and financial incentives, and manage population health risk more effectively. Health insurers, ranging from national companies to regional organizations, have expanded their involvement in the provider space through various approaches, including acquiring or affiliating with physician groups, outpatient networks, and care delivery platforms. The underlying theory was that putting insurers “on top” of the delivery system would allow them to streamline operations, reduce inefficiencies, and improve care coordination. In pursuit of these goals, many payors engaged in platform development by acquiring practices directly, or, in states with corporate practice of medicine restrictions, structuring relationships through management services organizations (MSOs) and management services agreements (MSAs).
The sponsors of the POP Act are taking a very different stance, not only questioning whether vertical integration works, but suggesting it may actually be driving market dysfunction, especially in Medicare Part B and Medicare Advantage. Critics of the bill, however, warn that it could go too far, creating new inefficiencies or distorting the market in other ways. The legislation reaches beyond direct ownership to include indirect and functional control, aiming to unwind much of the structure that has supported insurer-led care models for years.
Some proponents of the POP Act argue that when insurers own or control physician practices, they may blur the line between utilization management and clinical decision-making, potentially creating a conflict of interest. According to these supporters, financial incentives associated with insurance profits could influence care decisions, such as encouraging referrals within owned networks, or shaping approaches to coding and risk adjustment practices. Advocates of this perspective express concerns that integration strategies designed to control costs may instead lead to greater market concentration, reduced patient choice, or increased public program spending.
What’s in the POP Act? A Quick Breakdown
At its core, the POP Act would:
Prohibit direct or indirect ownership or control of both a health insurance issuer and any provider entity participating in Medicare or Medicare Advantage. Hospitals, critical access hospitals, rural emergency hospitals, pharmacies and suppliers of durable medical equipment, prosthetics, orthotics, and supplies are excluded from this prohibition.
Cover “health insurance issuers” (as defined in 42 U.S. Code § 300gg-91), which includes insurance companies, insurance services, and insurance organizations (including health maintenance organizations (HMOs)) that are licensed to engage in the business of insurance within a state and which are subject to state laws regulating insurance. This definition does not include employer-sponsored health plans governed by ERISA, whether those plans are self-funded or fully insured, or other ERISA-covered benefit arrangements. Provider-sponsored health plans are covered by the POP Act if they are licensed and regulated by the state as insurers or HMOs. They are not included if they operate solely as ERISA-covered employer-sponsored health plans or benefit arrangements.
Cover MSOs and MSAs by broadly restricting non-equity control mechanisms, including reserved powers or veto rights, not just ownership.
Impose mandatory divestiture timelines: two years for existing arrangements that were in place on or prior to the enactment of the POP Act and one year for any arrangements effectuated after enactment.
Enable federal enforcement through the Department of Justice, Federal Trade Commission (FTC), Office of the Inspector General of the Department of Health and Human Services, and state Attorneys General, with authority to require court-ordered divestiture (either of the provider or the MSO, if applicable, or of the health insurance issuer) and return of healthcare revenue generated during non-compliance.
Create an FTC fund to distribute proceeds recovered from violations to affected communities.
Bar non-compliant MA organizations from offering Medicare Advantage plans or Medicare Advantage-Prescription Drug (MA-PD) plans.
Subject violators to False Claims Act (FCA) exposure.
Include a comprehensive definition of MSOs and MSAs, ensuring the POP Act captures all relevant business relationships, regardless of corporate form.
In short, should the POP Act become law, health insurers would need to divest any operational or ownership connection to certain outpatient providers, notably physician practices, that bill Medicare, or they stand to face financial penalties and exclusion from key federal programs.
Where Things Stand Now
As of early November 2025, the POP Act remains in committee in both chambers. Introduced on September 17th, it was referred to the House Judiciary, Energy & Commerce, and Ways & Means Committees, as well as the Senate Judiciary Committee. No floor votes have occurred, and no markup or amendments have been reported. That said, the multi-committee referral hints at broad policy interest, with competition, Medicare finance, and delivery reform all in play. The first session of the 119th Congress still has time remaining, and the bill could be considered either in the current session or in the second session next year. If not passed before the second session ends, it would need to be reintroduced in the 120th Congress.
Why This Bill Matters – Even If It Doesn’t Pass (Yet)
Whether or not the POP Act ultimately passes, it reflects a noticeable change in how some lawmakers are thinking, favoring structural separation over more targeted regulatory oversight. That shift could prompt vertically integrated health systems, insurers, investors, and even regulators to rethink how they assess risk going forward.
The POP Act, in some ways, draws parallels to the Glass-Steagall Act of 1933, enacted during the Great Depression to separate commercial and investment banking and prevent conflicts between fiduciary duties and profit-driven investments. Though Glass-Steagall was eventually eroded through deregulation and ultimately repealed, both laws seek to draw clear boundaries between distinct market roles to protect public trust and ensure that decision-making is not swayed by competing incentives. Glass-Steagall was passed in response to a financial collapse. The POP Act, by contrast, would arguably be a preemptive measure in a healthcare system that is still testing the limits of vertical integration, perhaps before its benefits, risks, and safeguards are fully understood.
Below are key implications:
Medicare Advantage and FCA Exposure: MA plans are uniquely vulnerable under this proposal. Noncompliance could trigger False Claims Act (FCA) liability, including statutory penalties, treble damages, and whistleblower suits. The FCA exposure would likely apply to claims submitted under MA contracts, meaning both plan sponsors (issuers) and provider entities could find themselves at risk, depending on how regulators ultimately define the boundaries. As drafted, the POP Act would open the door to both sides being targeted.
Functional Control, Not Just Equity: One of the POP Act’s more aggressive features is its focus on indirect or functional control, not just equity ownership. That encompasses MSO pathways, MSAs, reserved rights, veto powers, and governance or contractual levers.
Enforcement Designed to Bite: Unlike most antitrust or structural remedies, which often leave discretion in the hands of agencies or courts, the POP Act mandates divestiture, disgorgement, and injunctive relief if a violation is found. Enforcement would vary across agencies, resource constraints, and litigation outcomes.
Market Impact: What This Could Look Like in Practice
Here is how different stakeholders and markets could be impacted by the POP Act:
National Payors: For large national insurers, the POP Act would unwind the very strategies that have shaped their healthcare cost-containment efforts. Over the past decade, these companies have poured resources into building integrated ecosystems that combine insurance, care delivery, and analytics. Forced separation would likely mean multibillion-dollar divestitures and significant disruption to actuarial models, Medicare Advantage performance, and value-based contracting structures. Without owned or closely aligned physician networks, plans would lose key levers for managing quality measures, Star Ratings, and utilization management, which would likely increase reliance on third-party networks and raise administrative costs.
Regional Payors: Regional plans that have pursued partial or hybrid integration models, such as joint ventures, MSO partnerships, or minority equity stakes in physician groups, would also face a complicated unwind. Many of these structures are tightly linked to population health and ACO initiatives that rely on local delivery networks. The POP Act would require regional plans to either divest MSO interests or renegotiate provider alignment models under pure contracting frameworks. While some regional payors may benefit if national payors are forced to divest, they would also contend with stronger provider bargaining power and a reduced ability to control total cost of care.
Integrated Delivery Networks (IDNs):For IDNs that combine insurance and delivery functions, the POP Act poses an existential structural challenge. These systems operate under integrated models where the health plan and provider entities are legally distinct but economically and operationally interdependent. Under the POP Act’s expansive reach, without the issuance of interpretive guidance, even non-equity coordination or exclusive contracting could be viewed as prohibited control. For nonprofit IDNs that rely on integration to drive preventive care, manage population health, and sustain MA performance, the POP Act could unwind decades of organizational design.
Hospital-Based Health Systems and Private Equity Investors: Hospital-based health systems without insurance arms may find themselves positioned to absorb physician practices and outpatient assets that insurers are forced to divest. For large nonprofit and regional systems, this could accelerate a new phase of provider re-integration, where hospitals rebuild physician networks once captured by payor-backed platforms. They will, however, be competing for the same acquisitions with private equity firms and specialty management companies, who are typically better capitalized and have been waiting for physician services valuations to normalize from the initial post-COVID surge. On the other hand, the POP Act’s broad view of control could put PE-backed MSO structures under the microscope as well, especially in cases where investors exert significant operational influence.
Medicare Markets: Some analysts expect major disruption to Medicare Advantage pricing, while others foresee a more gradual adjustment. In markets where MA enrollment already exceeds 50%, breaking apart integrated payor-provider models could upend plan bids and pricing. Without corresponding adjustments to CMS benchmark and quality incentive formulas, plans may face short-term swings in medical costs and Star Ratings, disrupting the predictability that supports premium setting. In markets where MA penetration is still below 50%, the near-term effect would likely be less dramatic. With fewer insurer-owned physician networks to unwind, pricing may remain steady for some time. Still, if divested practices shift into health system or private equity ownership, long-term cost pressures could build as provider leverage grows.
Healthcare Costs: The impact on patient outcomes and healthcare costs is uncertain. Severing physician practices from payors is unlikely to improve care coordination. Health systems, likely among the main beneficiaries as acquirers of divested practices, may be able to coordinate care more effectively within their own networks but would still depend on payor collaboration to achieve broader integration goals. They also may not always be the most cost-efficient option for care. Private equity investors, meanwhile, continue to face public and regulatory skepticism for purportedly emphasizing financial returns over long-term care outcomes. In short, the POP Act could ultimately replace one set of perceived problems with another.
Will the POP Act Pass? Unlikely, But It Shouldn’t Be Ignored
The POP Act faces an uphill path in Congress, but the ideas behind it are gaining traction. Growing concern over vertical integration is driving a segment of policymakers, regulators, and industry advocates to push for more structural guardrails and reform. In recent years, several states have ramped up their oversight of healthcare transactions, including transactions involving payors and providers. This suggests that state-level scrutiny is likely to continue expanding, even if federal legislation does not move forward.
The California Health Care Quality and Affordability Act broadens notice requirements to cover MSOs, private equity firms, and hedge funds. Oregon has maintained a healthcare transactions review process for several years that closely scrutinizes insurer and provider consolidations. New York requires pre-closing notice and review of “material transactions,” including acquisitions by health insurers of provider entities. These state-level initiatives began well before the POP Act, but if federal legislation stalls, states may step up their efforts to regulate insurer-provider integration in healthcare.
Final Word
The POP Act may never reach a floor vote, or it could undergo material amendments before passage. Nonetheless, its introduction reflects a growing willingness among some lawmakers to consider structural separation as an alternative to traditional regulatory oversight or gradual reform. This shift marks a significant development for deeply integrated organizations.
Footntoes
[i] Patients Over Profit Act (POP Act), H.R. 5433, 119th Cong., 1st Sess. (2025); Patients Over Profit Act (POP Act), S. 2836, 119th Cong., 1st Sess. (2025).
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Why Automatic Disclosure of a Consumer Legal Funding Contract Harms Consumers
Consumer Legal Funding is a vital financial lifeline for individuals who have been injured or wronged and are waiting for their legal claims to be resolved. These funds allow consumers to meet basic living expenses such as rent, groceries, utilities, and transportation while their case proceeds through what is often a long and uncertain process. Importantly, these transactions are non-recourse, meaning if the case is lost, the consumer has no further obligation.
Despite its consumer-oriented purpose, there are increasing calls, particularly from insurance industry lobbyists and defense interests, for automatic disclosure of these funding agreements to opposing parties or insurers. Proponents claim that disclosure promotes transparency and fairness in litigation. However, this argument overlooks the fundamental purpose of Consumer Legal Funding and the potential harm disclosure would inflict on the very individuals the civil justice system is designed to protect.
Automatic disclosure of a Consumer Legal Funding contract is unnecessary, intrusive, and detrimental to consumers’ rights. It tilts the playing field in favor of well-resourced defendants and insurance companies, undermines privacy, invites prejudice, and discourages access to justice.
1. Consumer Legal Funding Is Not Litigation Financing
A central misunderstanding driving automatic disclosure efforts is the false equivalence between Consumer Legal Funding and commercial litigation financing.
Commercial litigation financing involves funding the costs of litigation itself, legal fees, expert witnesses, and case expenses, usually provided to law firms or corporate plaintiffs.
By contrast, Consumer Legal Funding provides personal financial support to individuals, not funding for litigation costs. These funds are used for day-to-day living expenses, ensuring that consumers can keep their homes, feed their families, and avoid financial desperation that might otherwise force them into accepting low-value settlements.
Because Consumer Legal Funding is personal in nature and completely separate from litigation strategy, its automatic disclosure to the opposing party has no legitimate evidentiary or procedural purpose. Requiring automatic disclosure of a consumer’s private financial arrangement, particularly one unrelated to the merits or prosecution of the case, violates basic principles of privacy and fairness.
2. Disclosure Undermines the Consumer’s Right to Privacy
At its core, automatic disclosure represents a serious invasion of personal financial privacy. A Consumer Legal Funding contract contains sensitive information about a person’s financial hardship, living situation, and economic vulnerability.
Forcing disclosure of this information to be automatically disclosed to the opposing party, typically a corporate defendant or insurance company, is akin to allowing that party access to the consumer’s bank statements or credit reports. No other financial arrangements unrelated to litigation strategy, such as family loans, credit card debt, or payday loans, are subject to automatic disclosure. Singling out Consumer Legal Funding contracts for mandatory automatic disclosure is discriminatory and serves no legitimate purpose.
3. Disclosure Creates a Tactical Advantage for Insurers and Defendants
While proponents of automatic disclosure often frame it as a matter of transparency and fairness, its practical effect is to alter the balance of information in litigation. The key question for insurers should remain “What is a claim worth?” rather than “How long can the claimant afford to pursue it?”
Requiring disclosure of whether a consumer has received funds, and in what amount, provides insights that can unintentionally influence settlement dynamics. Such information allows one party to assess the other’s financial endurance, potentially affecting the timing or outcome of negotiations. In this way, automatic disclosure risks shifting the process away from an evaluation of the claim’s merits toward considerations of financial pressure.
Consumer Legal Funding arose to meet a real need: helping individuals manage essential living expenses while their legal claims are pending. It exists because claim resolution can take time, and consumers often face financial hardship during that period. The funding enables individuals to remain financially stable and fully participate in the legal process, ensuring that settlement decisions are made based on fairness, not necessity.
Rather than viewing Consumer Legal Funding as an obstacle, policymakers should recognize it as a tool that promotes equitable participation in the civil justice system. Automatic disclosure would undermine that goal by revealing sensitive personal financial information that has little relevance to the underlying case.
The question policymakers should consider is not whether disclosure benefits institutions, but whether it advances fairness for the individuals the justice system is designed to protect.
4. No Legal or Procedural Basis for Disclosure
Courts have long held that discovery should be limited to information relevant to the claims or defenses in dispute. A Consumer Legal Funding agreement does not affect liability, damages, or the merits of a legal claim. It merely ensures that the plaintiff can personally survive financially while pursuing justice.
5. Transparency Arguments Are Misleading
Insurance and defense groups often frame disclosure as a matter of transparency, claiming that all third-party financial interests should be visible to the court. But this argument conflates consumer protection with corporate convenience.
6. Disclosure Discourages Access to Justice
Automatic disclosure would have a chilling effect on consumers’ willingness to seek funding at all. Many individuals would rather go without assistance than have their personal financial struggles automatically shared with the opposing party.
7. Consumer Protection Laws Already Ensure Fairness
The argument that automatic disclosure is necessary to protect consumers ignores the fact that many state laws already provide robust consumer safeguards.
8. Potential for Abuse and Misuse of Information
If automatically disclosed, a Consumer Legal Funding contract could easily be misused. Insurers could share or store the information in ways that compromise consumer confidentiality.
9. Judicial Integrity and the Role of Courts
Courts should not become tools for economic surveillance. The role of the judiciary is to adjudicate disputes based on facts, law, and fairness, not to facilitate one side’s ability to gauge the other’s financial endurance.
10. Real-World Consequences for Consumers
Consider a typical Consumer Legal Funding client: an individual injured in a car accident, unable to work, and waiting months or even years for a fair insurance settlement. Without Consumer Legal Funding, that person may have no income. The funds received allow them to stay in their home, continue medical treatment, and support their family.
Conclusion
Automatic disclosure of Consumer Legal Funding contracts is a solution in search of a problem. It offers little value to the fair administration of justice, while introducing significant risks to consumer privacy and equity. Consumer Legal Funding serves a legitimate and important purpose: it helps individuals remain financially stable while pursuing their legal rights.
Mandating automatic disclosure of these personal financial arrangements does not advance transparency, it undermines fairness. It exposes sensitive information that has no bearing on liability, damages, or the merits of a case. Instead, it shifts attention from the facts of a claim to the financial endurance of the claimant, a consideration that should have no place in the pursuit of justice.
The appropriate balance lies in ensuring that consumers are protected, informed, and treated equitably. Several state regulations already provide clear safeguards governing disclosure between the consumer, their attorney, and the funding company.
Policymakers and courts should focus on preserving fairness, protecting privacy, and supporting a justice system that allows all parties, regardless of economic standing, to seek a fair outcome. Consumer Legal Funding continues to play an essential role in that mission, providing financial stability for those awaiting resolution, and ensuring that justice is determined by the strength of the claim, not the size of one’s bank account.
Campus Event Safety- Risk and Crisis Management Practices for Institutions of Higher Education
Recent violent incidents on campuses, including the fatal shooting of a controversial speaker, have underscored the urgent need for colleges and universities to assess their approaches to campus safety and free speech ahead of and during high-profile events.
Risk management in campus event planning is about anticipating, preventing, and minimizing potential problems before they arise. For campus events, this means robust planning, stakeholder engagement, and layered security protocols. Key risk management strategies include:
Event Registration & Assessment
Colleges and universities should have a policy that require all large, high-profile, or potentially controversial events hosted on campus to be registered and approved. A registration form or centralized registration system should include questions about the event such as: estimated number of attendees, speaker and topic of the event, location, date and time, marketing and media. This registration process should be used to flag any events for additional review and approvals, consistent with the campus’s free speech policies. Assess the risk level for registered events using a standardized tool to ensure consistency in approach to events – consider using a committee to review all large, high-profile, or potentially controversial events.
Any committee or administrator who evaluates the risk level of events should be trained to do so in a way that is viewpoint neutral. While content of speech may be considered to the extent that it is likely to inflame or cause public reactions or outcry, the assessment should also focus on safety considerations outside of the content, such as the size of the crowd anticipated and experiences across institutions that have hosted the speaker or similar speakers. Restrictions imposed by the institution should reflect an equitable approach that is not determined by the speaker’s political positions.
Advance and Centralized Event Safety Planning
Once an event is registered and approved by the institution, advance institutional planning can begin. This includes looping in relevant university offices, including not only the Events Office, but also public safety and campus police, PR and communications, student affairs, and even local police as necessary. See our future client alert on the work that public safety, campus police, and local police can engage in to develop event-specific safety and security plans.
Contractual Risk Allocation Through Speaker Contracts
Institutions should consider using standardized contracts or contractual provisions for outside speakers or performers that require the individuals to abide by campus rules, provide appropriate insurance, and accept indemnification clauses. Campuses should consult counsel about requiring speakers and performers to adhere to specific safety protocol, and requiring the speakers or group hosting them to bear costs for security measures.
Physical and Infrastructure Event Controls
Colleges and universities have a variety of event locations – from outside quads to indoor auditoriums and arenas. Consider holding high-risk events in controlled, indoor venues where access and egress can be managed for attendees. Remember to restrict dangerous items, remove objects that could be weaponized, and use physical barriers to separate opposing groups. Enforce campus policies on signs, amplified noise, and chalking consistently.
Crowd and Access Management
Consider whether your event will be open to the public or whether access will be limited only to students and employees of the university. Use ticketing to limit attendance and require IDs for entry. For events with a Q&A or debate-style, assign a moderator and provide for live audience feedback in controlled formats.
Ongoing Threat Monitoring
Remember to leverage campus and local law enforcement, campus threat assessment teams, and campus media and communications teams to monitor social media and other channels for signs of planned disruptions or violence. If disruptions are expected, offer support for counter-events, providing clear guidance and maintaining separation of the event and the counter-event to reduce conflict.
Crisis management in campus event planning is the suite of activities activated if and when an incident does occur, with the goal of protecting people, property, and institutional reputation, while restoring order and learning from the event. Key crisis management strategies include:
Crisis Team Activation
Before the event, make sure your crisis team is aware of the event and any potential concerns. When a crisis occurs, activate your crisis team, including campus safety, legal, PR and communications, student affairs, and administration.
Emergency Protocols
Run tabletops of your emergency protocols before the event occurs, including clear procedures for lockdown, evacuation, emergency alerts, and medical events. When a crisis occurs, activate your emergency protocols.
Crisis Communications
Develop messaging templates for various scenarios and various audiences – including board/university leadership; students, faculty, and staff; parents; local community; and media. During a crisis, remember to communicate clearly and accurately. Issue rapid, coordinated communications to campus, families, and media. Don’t forget your Clery obligations for timely warnings and emergency notifications.
Compliance Considerations During a Crisis
Consult legal counsel on First Amendment obligations (for public universities) and university policies and procedures, especially before restricting speech or imposing post-event discipline.
After-Action Review
Make time to conduct a structured debrief with all involved departments, adjust protocols as needed, and provide support to affected students, staff, and faculty. Even if everything goes well before and during and event, debrief with the event organizers on what went well and what could be improved.