Transcript 2015 Health Care and Employment Law Update

2015 Health Care and Employment
Law Update
The Hiring Process – An Interactive
Approach
Tom H. Luetkemeyer
May 7, 2015
Conducting the Lawful Interview
 Hiring skills break down into four principal categories
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Legal issues affecting the hiring process
Understanding the questions not to ask
Current issues raised by social media concerns
Questions to ask and appropriate areas of inquiry
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Conducting the Lawful Interview
 Federal and state statutes and regulations have a
substantial impact on the hiring process
 Not only is the process affected by traditional antidiscrimination and anti-retaliation laws, but there are
specific statutes governing the hiring process itself and
concerning the following topics:
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Credit reports
Criminal background
Arrest records
Social media
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Conducting the Lawful Interview
 Title VII of the Civil Rights of 1964 provides a federal
mechanism for applicants to challenge employers' hiring
decisions
 Title VII generally is utilized in two ways with respect to
allegations of discrimination
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Intentional discrimination when an interviewer inquires about a
protected characteristic, or when an applicant believes a
protected characteristic might be a motivating factor in the
decision not to hire.
The use of hiring criteria (for example, educational requirements)
or even aptitude tests often are the basis for a disparate impact
claim under Title VII
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Conducting the Lawful Interview
 The Age Discrimination in Employment Act also must be taken into
consideration not only in the interview process itself but in the written
application process
 Except in extremely narrow circumstances, age should never be taken into
consideration in a hiring decision (limited exception example–airline pilots)
 Employment decisions always can be made on a "reasonable factor other
than age"
 Although disparate impact theory is available under the ADEA as a result of
the Supreme Court's decision in Smith v. City of Jackson, such cases are
rare
 Avoid asking questions (during the interview or in an application) which
would require an applicant to disclose age or a range of age of any
applicant
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Conducting the Lawful Interview
 The American with Disabilities Act
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Not only does The Americans With Disabilities Act (ADA) protect
individuals against discrimination based on a disability, but it also
provides protection for the non-disabled and limits a prospective
employer's right to make certain medical inquiries
The ADA protects individuals with a disability, individuals with a
history of a disability and individuals who may be perceived as
having a disability
Once again, both applications and the interview script should be
reviewed to eliminate questions which inappropriately or
prematurely raise issues concerning potentially disabling
conditions
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Conducting the Lawful Interview
 The Illinois Human Rights Act
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The concerns raised under the Illinois Human Rights Act (IHRA)
mirror in many respects the claims which could be brought under
Title VII
The IHRA provides protection beyond that which is available
under Title VII, and it is unlawful in the State of Illinois to
discriminate on the basis of:
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Marital status
Sexual orientation
Transgendered status
The types of claims which can be brought under the IHRA related
to the hiring process are very similar to Title VII, but also include
liability for "aiders and abettors"
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Conducting the Lawful Interview

The IHRA also has an express prohibition against the use of arrest records:
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"(A) Unless otherwise authorized by law, it is a civil rights violation for any
employer, employment agency or labor organization to inquire into or to use the
fact of an arrest or criminal history record information ordered expunged, sealed
or impounded under Section 5.2 of the Criminal Identification Act as a basis to
refuse to hire, to segregate, or to act with respect to recruitment, hiring,
promotion, renewal of employment, selection for training or apprenticeship,
discharge, discipline, tenure or terms, privileges or conditions of employment.
This Section does not prohibit a State agency, unit of local government or school
district, or private organization from requesting or utilizing sealed felony conviction
information obtained from the Department of State Police under the provisions of
Section 3 of the Criminal Identification Act or under other State or federal laws or
regulations that require criminal background checks in evaluating the
qualifications and character of an employee or a prospective employee.
(B) The prohibition against the use of the fact of an arrest contained in this
Section shall not be construed to prohibit an employer, employment agency, or
labor organization from obtaining or using other information which indicates that a
person actually engaged in the conduct for which he or she was arrested."
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Conducting the Lawful Interview
 Retaliation based on protected activity is increasingly used as a
basis for claims against employers in the hiring process
 Engaging in protected Section 7 activity could form the basis for an
unfair labor practice charge under the National Labor Relations Act
 Protected Section 7 activity could arise in a number of respects:
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Support or lack of support for a labor organization
An examination of the root cause of prior disciplinary issues at a prior
employer
Some actions are deemed now by the NLRB to be "inherently concerted"
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Discussion of compensation
Circulation of employment opportunities
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Conducting the Lawful Interview
 The federal Fair Credit Reporting Act (FCRA) identifies responsibilities an
employer may have when using consumer reports for employment purposes
 A consumer report is a report prepared by a consumer reporting agency
(CRA) that contains information about an applicant's credit and other
personal characteristics
 Before a consumer report can be obtained for employment purposes, an
applicant must be notified in writing that the report may be used, and written
authorization is necessary before an employer may request a report from a
CRA
 In the event a prospective employer intends to take "adverse action" against
an applicant, there are both pre-adverse action disclosures and adverse
action notices which are necessary
 These notice requirements include the obligation to provide a copy of not
only the report but a summary of rights under the FCRA, which is a
document available from the Federal Trade Commission
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Conducting the Lawful Interview
 The Job Opportunities for Qualified Applicants Act went into effect
within the past year and prohibits consideration by employers of
criminal history of applicants, except in limited circumstances
 The Act is commonly referred to as "Ban the Box" legislation
because it prohibits inquiries on applications into criminal history
until a certain point in the hiring process has been reached
 A criminal history cannot be used until an employer has made a
determination that the individual is qualified for a position and the
applicant has been notified of an interview; or
 If no interview is to be conducted, a criminal history cannot be
utilized until a conditional offer of employment is made
 The Act covers employers with at least fifteen (15) employees and is
enforced by the Illinois Department of Labor
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Conducting the Lawful Interview
 The Illinois Right to Privacy in the Workplace Act
governs a number of situations relevant to the hiring
process
 In Illinois, it is unlawful to inquire of an applicant about
his or her lawful use of lawful products (tobacco and
alcohol)
 It is unlawful to inquire into an individual's workers
compensation claims
 It is unlawful for an employer to require disclosure of a
password to gain access to applicants' personal social
media account
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Conducting the Lawful Interview
 Garnishments and bankruptcies also are provided to a
certain extent
 The federal Bankruptcy Code prohibits employment
decisions on the basis of an individual's prior filing of a
petition in bankruptcy, except in limited circumstances
 Illinois law also prohibits a fact of a prior garnishment
being utilized in certain employment decisions
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Conducting the Lawful Interview
 Conviction of felonies?
 Whether an applicant is a citizen
 Whether childcare obligations might prevent an applicant
from meeting time requirements
 The applicant presents in a wheelchair, can you ask
whether he/she requires any special accommodations?
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Conducting the Lawful Interview
 Can an interviewer ask whether the applicant likes to be
addressed as "Mr", "Miss", "Mrs." or "Ms."?
 You see that your applicant was in the military can you
ask whether he/she was discharged honorably?
 The applicant has an unusual name. Can you inquire
into the origin of that name?
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Conducting the Lawful Interview
 Can you ask for a photograph?
 Can you do Skype interviews?
 Can you ask whether the applicant owns or rents?
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Conducting the Lawful Interview
 Know the requirements of the job
 Know the qualities you are seeking in a candidate
 Review and know the applicant's background, as well
has his/her resume and/or cv
 Ask questions that go to the requirements of the job and
the qualities you desire for the incumbent in the position
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Conducting the Lawful Interview
 Review relevant work history with the applicant
 Discuss reasons for leaving each prior employer
 Review notable achievements
 Ask about needs for education/skill building
 Ask about particular challenges the applicant has had in
prior employment
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Conducting the Lawful Interview
 Inquire about any performance issues the applicant had
with prior employers
 Investigate gaps in employment
 Do not hesitate to ask substantive questions
 Follow up on openings given by applicant within the
scope of the law
 Ask about personal goals in prior jobs that were not
achieved
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Conducting the Lawful Interview
 Inquire about any performance issues the applicant had
with prior employers
 Investigate gaps in employment
 Do not hesitate to ask substantive questions
 Follow up on openings given by applicant within the
scope of the law
 Ask about personal goals in prior jobs that were not
achieved
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Electronic Data Breach /
HIPAA Settlement
 Two New York–based healthcare organizations entered into a $4.8 million
settlement agreement with the Office of Civil Rights (OCR) of the
Department of Health and Human Services
 In addition, the two hospitals agreed to a corrective action plan for a data
breach involving the failure to secure approximately 6,800 patients'
electronic protective health information (ePHI). The breach was discovered
after an individual found information about his deceased partner on the
internet
 The investigation and fine resulted after the entities submitted a joint data
breach report to OCR when it learned of the breach following patient
complaints. The OCR found that neither organization had made efforts prior
to the breach to ensure that the server was secured or contained
appropriate software protections
 According to OCR, neither entity had developed an adequate risk
management plan that addressed the accessibility of the ePHI or addressed
the potential threats and hazard to the security of the ePHI
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Electronic Data Breach /
HIPAA Settlement
 The record settlement underscores the importance of implementing and
repeatedly updating data security measures. All covered entities and
business associates need to:
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Conduct thorough, complete and accurate risk analyses on an ongoing basis and
address identified threats and vulnerabilities and documents of such efforts
Develop and enforce policies and procedures on access to and the security of
servers
Ensure that technical safe guards are in effect for servers
Conduct staff training on security issues
 Covered entities and business associates should remember that they are
responsible for knowing all of the systems, IT equipment, applications and
data systems that can access ePHI, and are responsible for the security of
data involved in joint data sharing arrangements
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The Anti-Kickback Statute
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The 7th Circuit Court of Appeals (our jurisdiction) recently weighed-in on what it
means to make a referral.
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In U.S. v. Patel, decided February 10, 2015, the Court ruled that by accepting a cash
payment from Grand Home Healthcare in exchange for every patient Dr. Patel
"referred", he was receiving kickbacks in violation of the AKS
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Dr. Patel argued he was not "referring" patients in the manner prohibited by the
statute. He prescribed home healthcare services to approximately 10 of his patients
per month, and Grand was one of 10-20 home health providers utilized by his
patients
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Dr. Patel would make the initial determination that a patient required home healthcare
services, and then the patient and family would discuss home healthcare options with
Dr. Patel's medical assistant. His assistant was not informed by Dr. Patel of which
provider to recommend
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He was not involved in the patient's choice
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Each patient was provided with a list of home health providers in their brochures
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The Anti-Kickback Statute
 Dr. Patel argued that the word "referred" means to personally
recommend to a patient that the patient seeks care from a particular
entity
 The government argued for a broader reading of the word "referred",
which includes a doctor's authorization of care by a particular
provider
 The 7th Circuit adopted the more expansive definition of a "referral"
and held that certifications and re-certifications are referrals under
the Anti-Kickback statute
 The Court reasoned that it does not matter who first identifies the
homecare provider, because the physician acts as a gatekeeper
 Without the physician's approval, the patients could not receive
homecare services from the provider that the patient selected
© 2015 Hinshaw & Culbertson LLP, an Illinois Limited Liability Partnership. All rights reserved.
The Anti-Kickback Statute
 The Office of the Inspector General (OIG) issued a
March 2015 opinion advising against a clinical
laboratory's proposed arrangement with physician
practices under which it would provide all lab services for
the practices' patients and waive fees for those patients
whose insurance plans would otherwise require them to
use a different lab
 The OIG determined that the proposed arrangement
could potentially implicate prohibited remuneration under
the Anti-Kickback statute
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The Anti-Kickback Statute
 The facts are fairly straight-forward:
• Seventy percent of the lab's physician practice clients have patients who are
enrolled in insurance plans that require their enrollees to use a particular lab
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None of these exclusive plans included individuals with government healthcare
coverage as their primary insurance coverage, but some exclusive plan enrollees
could have federal governmental coverage as their secondary insurance
coverage
If lab X is not the exclusive plan's designated lab, the plan does not pay for any
testing
Under the proposed arrangement, lab X would have provided free services to
certain patients to secure all the business, including governmental healthcare
program business, from physician practices
It would not have billed the patients with exclusive plans that require the use of a
different lab
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The Anti-Kickback Statute
 The OIG determined that the proposed arrangement could
potentially generate prohibited remuneration under the AntiKickback statute
 Although physicians and physician practices would not receive
direct payments under the proposed arrangement, the OIG
determined that reducing administrative and possibly financial
burdens associated with using multiple labs could constitute
prohibited remuneration
 The OIG was not willing to rule out that the proposed arrangement
would not involve lab acts offering remuneration to induce the
referral of federal program business
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Meaningful Use
 The Department of Health and Human Services, Centers
for Medicare & Medicaid Services (CMS) published
proposed Stage 3 rulings for electronic health records
incentive program on March 30, 2015. The proposed
Stage 3 rules will require medical professionals,
hospitals and critical access hospitals to adopt and
continue to prove meaningful use of electronic health
records
 The 60-day comment period closes on May 29, 2015
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Meaningful Use
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A significant portion of the proposed changes addressed Stage 3's proposed
standard for proving "meaningful use"
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Stage 3 will be the final stage; it will begin in 2017. It will be mandatory for all
providers in 2018. Overall, Stage 3's proposed meaningful use consists of eight
objectives:
All providers must show they conduct a security risk analysis of their EHR system
and correct any security deficiencies
Eligible professionals must transmit more than 80% of prescriptions electronically,
which is an increase from Stage 2's 50% standard. Twenty eligible hospitals and
critical access hospitals must transmit 25% of prescriptions electronically, which is
an increase from the 10% standard found in Stage 2
All providers must show the use of five Clinical Decision Support (CDS)
interventions to improve performance before diagnostic or treatment action is
taken in response to the intervention
Providers must order 80% of medication orders, 60% of laboratory orders and
60% of diagnostic imagining orders using computerized provider order entry
© 2015 Hinshaw & Culbertson LLP, an Illinois Limited Liability Partnership. All rights reserved.
Meaningful Use
 80% of patients must be able to electronically access their
health information electronically within 24 hours of its
availability to provider. Stage 2 had required 50% of patients
to have the same access within four business days
 Providers must show that they are meeting two of the three
following categories:
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25% of patients must use EHS to access their records
35% of patients must receive a clinically-relevant secured message
regarding their healthcare; and
15% of patients must incorporate information acquired from their
patients or from non-clinical settings, such as data acquired from other
care providers such as nutritionists and physical therapists
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Meaningful Use
 Providers must use electronic summary of care records
for patients seeking care among different providers
 With respect to public health and clinical data registry
reporting, eligible professionals must report on three of
the first five public health measures, while eligible
hospitals and critical access hospitals must report on
four measures out of all six. The measures are
immunization registry reporting, syndromic surveillance
reporting, case reporting of reportable conditions, public
health registry reporting, clinical data registry reporting
and electronic reported laboratory results
© 2015 Hinshaw & Culbertson LLP, an Illinois Limited Liability Partnership. All rights reserved.
Physician Restricted Covenant
 In Prairie Rheumatology Associates v. Francis, the Third Appellate
District, which covers Central Illinois lined up with the First Appellate
District (Chicago area) to require a minimum two-year employment
period as sufficient consideration for a restrictive covenant
 In Prairie Rheumatology, a physician had an employment
agreement with a two-year restrictive covenant
 The physician voluntarily resigned her employment after 19 months,
which was five months short of the two-year requirement set by the
First District in the decision of Fifield v. Premiere Dealer Services,
Inc.
 Like the First District, the Third District held that employment must
last for at least two years in order to be construed as reasonable
consideration for a restrictive covenant
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Physician Restricted Covenant
 In light of Prairie Rheumatology, we recommend:
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Consider cash consideration for a covenant
Cash consideration can come in multiple forms, including, for
example, a signing bonus
Set a lower first year salary in conjunction with another form of
cash consideration
Consider additional vacation or benefit days during the first year
 Re-evaluate all covenants to make sure they are
compliant with existing case law
© 2015 Hinshaw & Culbertson LLP, an Illinois Limited Liability Partnership. All rights reserved.
Tom H. Luetkemeyer
Hinshaw & Culbertson LLP
Chicago 312-704-3056
[email protected]
www.hinshawlaw.com
© 2015 Hinshaw & Culbertson LLP, an Illinois Limited Liability Partnership. All rights reserved.