In short, the Final Rule defines Marketing to mean any
communication about a product or service that encourages the individual receiving
the communication to purchase the product or service. Absent an exception, any such Marketing
communication that relies on the use or disclosure of the individual’s
Protected Health Information (“PHI”) requires a HIPAA authorization.
There are several exceptions to the Marketing definition
under the Final Rule, one of which is to provide refill
reminders or otherwise communicate about a drug or biologic that is currently
being prescribed for the individual, but
only if any financial remuneration received by the HIPAA-covered entity in
exchange for making the communication is reasonably
related to the cost of making the communication. Absent compliance with these criteria, a
HIPAA authorization would be required before any such communications were
permitted.
As the September 23, 2013 compliance deadline nears,
Adheris, Inc., a company that receives “financial remuneration” from
pharmaceutical companies for sending refill reminders to patients, has filed a
lawsuit and a motion for preliminary injunction suit against enforcement by HHS
of this refill reminder exception under the Marketing definition. As part of this legal process, Adheris is
also seeking further delineation of what “reasonably related” means under this
exception.
According to a joint
motion to suspend a briefing schedule on Adheris, Inc.’s motion for preliminary
injunction filed on September 11, 2013, in Adheris, Inc. v. Sebelius et al.,
counsel for the defendants was informed that HHS:
[I]ntends to issue
further guidance concerning the provision challenged by plaintiff in this
litigation. The guidance will pertain to
the financial remuneration that would be considered ‘reasonable’ for providing
refill communications or other communications about a drug or biologic
currently being prescribed to an individual.
HHS expects to issue such guidance by September 23, 2013.
The joint motion also
states that the Secretary of HHS will not enforce the provision regarding
financial remuneration for refill reminders for a period of 45 days after the
September 23, 2013 date, or until November 7, 2013, but expects to provide
guidance on this issue by the September 23, 2013 date. (Joint Motion, at ¶¶ 4, 5).
HIPAA’s updated
Marketing definition and the many different exceptions are of particular
interest to pharmacies, pharmaceutical companies and entities such as Adheris,
which qualify as HIPAA business associates to the pharmacies. Determining what is “reasonable” financial
remuneration for a refill reminder is just one of the many issues with respect
to the Marketing definition under HIPAA.
It remains to be seen what kind of guidance is issued by HHS in the next
few weeks, and whether it will address any of the other exceptions to the
Marketing definition.
If you have any
questions regarding the Final Rule, the updated Marketing definition under
HIPAA, or the Adheris, Inc. v. Sebelius, et al. matter, please
contact Susan Ziel at sziel@kdlegal.com,
Ed Rickert, at erickert@kdlegal.com, or Jaya White at jwhite@kdlegal.com.