NOVEMBER 9, 2021 PROGRAM ANNOUNCEMENT

Connecting our Communities: Implementing a statewide, closed-loop referral system to address Social Determinants of Health

Time: 12:00 noon to 1:00 pm

Place: Cisco WebEx

Heath Current teamed with AHCCCS and, in collaboration with 2-1-1 Arizona operated by Solari, are implementing a single, statewide closed-loop referral system called CommunityCares to address social determinants of health (SDOH) needs in Arizona. This new technology platform is designed to connect healthcare and community service providers to streamline the referral process, foster easier access to vital services and provide confirmation when social services are delivered. Learn more about the program, its goals, features, and the progress thus far, including how and when health information may be shared with AHCCCS-registered community service agencies (CSAs)—a registered health care provider type in Arizona, as well as community based organization (CBOs) in compliance with state and federal health information laws, like HIPAA.

Speaker Biographies:

Dana Flannery is the Senior Policy Advisor for AHCCCS and Assistant Director of the Division of Community Advocacy and Intergovernmental Relations (DCAIR). As senior policy advisor to the director of AHCCCS, Dana Flannery serves as a conduit between the agency’s divisions and the executive team, and a source of guidance for the agency’s director, two deputy directors, and chief medical officer. As assistant director of DCAIR, Dana oversees the AHCCCS Office of Individual and Family Affairs, the Office of Human Rights, the agency’s intergovernmental/tribal relations and communications team, and several other committees and councils. Dana brings more than seventeen years of experience in the behavioral health field, ten of which have been with the State of Arizona. During that time, she has become a leader in public health policy for a wide variety of populations. With colleagues, she helped to develop the Arizona Peer Advancement Career Academy as well as several advocacy training courses, led stakeholder engagement for major agency initiatives, and assisted in health policy development that has a direct impact on members. Dana is a graduate of Arizona State University.

Kathryn Greene is the Privacy Officer for the Arizona Health Care Cost Containment System (AHCCCS).  As the Privacy Officer, she ensures AHCCCS’s compliance with HIPAA, 42 C.F.R. Part 2, and other federal and state privacy laws. Kathryn has over 18 years’ experience as a Privacy Officer, having previously served as the Chief Privacy Officer for the Arizona Department of Economic Security and the Privacy Officer and System Security Officer for the Arizona Department of Child Safety prior to her position with AHCCCS five years ago.

Andrew Terech is the Director of Social Determinants of Health for Health Current, Arizona’s Health Information Exchange. He is a licensed associate counselor and has over 13 years of experience working in various leadership roles in behavioral healthcare and integrated healthcare settings. His passion for helping people led him to Health Current where he is leading a team to implement a statewide SDOH referral program aimed at improving access to vital social services.   

Due to the current social distancing recommendations, this program will be held via video conference through Cisco WebEx.  This program will be $10 for members and $15 for non-members.

To register, please visit our website https://azsha.org/, click upcoming programs, on the right you will see a button that says “Register for Next Program Pay Now”. This button will take you to a screen with multiple payment options. Please select your membership level. If you are a member, please login and proceed with the payment process. If you are not a member, you will have to create a username and password to continue with the payment process.

Once you have registered online, you will receive a calendar invite containing the WebEx link. Please note, you don’t need to sign up for a WebEx Account to join a meeting.

The State Bar of Arizona does not approve or accredit CLE activities for the Mandatory Continuing Legal Education requirement. This activity may qualify for up to 1.0 hours of CLE credit, 0 hours of ethics, toward your annual requirement for the State Bar of Arizona.

Update on Arbitration Clauses in Medical Malpractice Cases

By: Paul J. Giancola and Claudia E. Stedman, Snell & Wilmer

Healthcare providers and counsel frequently view arbitration agreements as more efficient and more cost-effective alternatives to litigation—and indeed, in many circumstances, this form of alternative dispute resolution can be a critical tool in managing costs and helping parties reach a compromise more efficiently. Recent Arizona case law on arbitration clauses in the context of medical malpractice cases serves as a reminder of the issues that counsel should be mindful of in drafting these contractual provisions for their healthcare clients.

Heaphy v. Willow Canyon Healthcare, Inc.

On May 18, 2021, the Arizona Court of Appeals ruled in Heaphy v. Willow Canyon Healthcare, Inc. that a wife acting in the capacity of her husband’s healthcare power of attorney (HPOA) did not have authority to bind her husband or his estate to an optional arbitration agreement when admitting him to a nursing home when the wife failed to indicate that she was the legal representative or agent. 251 Ariz. 358, 491 P.3d 1165 (Ct. App. 2021).

By way of background, in 2012, Charles Heaphy appointed his wife, Shirley Heaphy, as his HPOA. In 2017, Ms. Heaphy admitted her husband to Pueblo Springs Rehabilitation Center—a skilled nursing and rehabilitation center. The contract that Mrs. Heaphy signed with the facility included an optional arbitration agreement, asked for the signature of a “Legal Representative or Agent,” and “directed an agent signing in that capacity to also execute on the same page a separate ‘Acknowledge of Legal Representative or Agent.’” Id. at 1167. Mrs. Heaphy signed her husband’s name on the resident line and signed her own name on the adjacent signature line. She did not sign as the legal representative or the acknowledgment. Mr. Heaphy passed away a few weeks after he was admitted to Pueblo Springs.

In 2019, Mrs. Heaphy, acting in her capacity as personal representative of Mr. Heaphy’s estate and on behalf of all statutory beneficiaries (Plaintiff), sued Willow Canyon Healthcare—the owner of Pueblo Springs—and the doctor who treated Mr. Heaphy. Mrs. Heaphy alleged elder abuse, negligence, negligent hiring and supervision, and wrongful death. Id. at 1167-68.

Willow Canyon filed a motion to compel arbitration based on the contract with the skilled nursing facility that Mrs. Heaphy filled out when her husband was admitted. Plaintiff argued, however, that the contract was not enforceable because it was unconscionable, and that Mrs. Heaphy lacked authority to bind either the estate or the beneficiaries. The trial court denied the motion to compel arbitration, but held an evidentiary hearing to assess whether Mrs. Heaphy had the authority to sign the contract with Willow Canyon as her husband’s agent. The trial court held that the estate’s claims were not subject to the arbitration clause in the agreement with Willow Canyon because though Mrs. Heaphy was HPOA, she was not authorized to sign the contract on her husband’s behalf, and that it was procedurally unconscionable under the circumstances.

Willow Canyon appealed the trial court’s decision, arguing that Mrs. Heaphy had actual authority, either express or implied, to sign the agreement and, even if she lacked such authority, she should be equitably estopped from denying such authority, the agreement was not unconscionable, and the Federal Arbitration Act (FAA) preempted Arizona case law “holding that an arbitration agreement cannot bind non-signatories.” Id. at 1168.

The Arizona Court of Appeals stated that it was required to defer to the trial court’s factual findings absent clear error. Therefore, the Court affirmed the trial court’s decision to deny Willow Canyon’s motion to compel arbitration for the following reasons:

First, on the issue of express actual authority, the Court examined the plain language of the HPOA and found that it authorized Mrs. Heaphy to have full authority to make decisions regarding healthcare, but only limited authority “to seek damages from a healthcare provider for its failure to comply with Charles’s refusal of treatment or his wishes . . . .” Id. at 1169. Further, because the arbitration clause was optional and “not required for Charles to be admitted into Pueblo Springs, it was not a healthcare decision as contemplated by the HPOA.” Id.

Second, the Court found that Mrs. Heaphy lacked implied actual authority to bind her husband’s estate because the HPOA did not “expand the scope of her authority such as to encompass the optional” arbitration agreement.” Id. at 1170.

Third, the Court found that the elements of equitable estoppel were not met because, among other things, Mrs. Heaphy’s signing of the optional arbitration agreement “did not represent that she had authority to bind Charles and his estate, particularly when she did not sign the line provided for the ‘Legal Representative or Agent’ and the related acknowledgement on that page.” Id.

Fourth, the Court determined that the trial court’s decision was consistent with both Arizona law and the FAA and that the arbitration agreement was unenforceable because Mrs. Heaphy lacked authority to enter into it on behalf of her husband. Id. at 1171.

In summary, the Court of Appeals found that an HPOA is limited in scope and does not confer the legal authority for the HPOA to waive legal right such as trial by jury. In contrast, an appropriately drafted power of attorney and signed arbitration provision likely would have conferred the appropriate legal authority to require that Mr. Heaphy and his estate arbitrate. A potentially open question, but likely derivative of the first question is whether the beneficiaries would also be bound by the agreement to arbitrate.

Considerations for Arbitration Clauses in the Context of Medical Malpractice

The current legal landscape is such that courts will try to enforce binding, pre-dispute arbitration agreements, even in the medical malpractice context. While there is strong public policy favoring arbitration agreements, there are common pitfalls that drafters of such agreements should watch out for.  

Drafting Considerations & Unconscionability

From a practical standpoint, it is important to consider the sometime overlooked drafting and structure of arbitration clauses. In the context of medical malpractice claims, courts balance the public policy and efficiency considerations of arbitration agreements against the fact that patients or their caregivers may fail to comprehend what legal rights they are relinquishing by signing an arbitration agreement. Therefore, courts scrutinize arbitration provisions more closely than they would in a commercial context. Courts look at both substantive (overly oppressive terms or unduly harsh to one party) and procedural (the process for entering into the agreement) unconscionability.

An unconscionability claim can be successfully argued if an arbitration provision is unduly one-sided or makes medical care contingent on agreeing to arbitrate. In Gullett v. Kindred Nursing Centers West, LLC, the nursing center moved to compel arbitration pursuant to the contract between it and the Plaintiff. 241 Ariz. 532 (Ct. App. 2017). The Plaintiff opposed the motion, arguing that the arbitration agreement was substantively unconscionable if not procedurally unconscionable. Id. at 535. In evaluating whether the arbitration agreement was substantively unconscionable, the Court considered whether the “amount of permitted discovery is so low and the burden to obtain additional discovery so high that the litigant is effectively unable to vindicate their claim.” Id. at 536.

In Gullet, the Court found that because the arbitration agreement allowed for “30 interrogatories, 30 requests for production, 10 requests for admission, six lay depositions and two expert depositions,” the agreement was not substantially unconscionable. Id. at 537. The Court likewise disagreed with the Plaintiff on the procedural unconscionability claim, finding that because the arbitration agreement required the parties to find an impartial arbitrator or select from an approved list, there was mutuality and the agreement was fair. Id. at 539.

When writing an arbitration agreement, drafters should consider writing the provision out in bold type or capitalized letters to focus the signor’s attention and highlight the particular language so that the patient is put on notice that they are giving up certain legal rights. In the case of a particularly voluminous contract—as in the Heaphy case where the entire contract with the skilled nursing facility was almost 60 pages long—drafters may want to consider having the arbitration provisions set off in an entirely separate document from the rest of the agreement. Additionally, using plain, simple language is important in defending against a potential claim that the contract is unenforceable because the patient did not understand what he or she was signing.  

Simply because a contract is one of adhesion does not make it automatically unenforceable. However, courts will consider “take it or leave it” agreements in light of whether the patient “knowingly consented to the clause and what the patient’s reasonable expectations of signing that provision were.” Broemmer v. Abortion Serv’s of Phoenix, Ltd., 173 Ariz. 148, 152 (1992). For this reason, when drafting an arbitration agreement, counsel may also want to include language clearly indicating that signing is an arbitration agreement is voluntary and that a patient’s medical care will not be contingent on whether they agree to arbitrate or not.

Drafting considerations go hand-in-hand with upholding the enforceability of an arbitration agreement. To avoid a claim that a contract is unconscionable, counsel and providers should evaluate the patient’s expectations and ensure that the patient has knowingly consented to the agreement. Patients should be informed of the arbitration agreement prior to consenting to the medical treatment or procedure. Terms that limit discovery or limit recovery of damages should likely be omitted. Finally, counsel should frequently review the terms of the arbitration agreement and update the language as necessary.

Update on the Status of the Section 1557 Health Care Non-discrimination Regulations

by: Karen Owens, Coppersmith Brockelman PLC[1]

Section 1557 of the Affordable Care Act,[2] the first health care-specific anti-discrimination provision in federal law, has been in the news again recently.  The law and its regulations have had a complicated history, and the situation is still dynamic.     

The Affordable Care Act passed in 2010, and an initial regulation set was promulgated in 2016.[3]  That set established 1557’s broad coverage, including requirements that health care entities provide signage and documents in various languages and a declaration that the term “sex discrimination” in the law extended to protect transgender individuals and pregnancy-related health care.  For the Trump Administration, rewriting the Section 1557 regulations was a priority, and 2020 saw the publication of an entirely new regulation set.  The 2020 regulations made big changes, including narrowing the entities subject to Section 1557’s anti-discrimination provisions, limiting the language and signage requirements, and removing transgender and pregnancy-related protections. 

Since then, the courts, including the U.S. Supreme Court, have weighed in on aspects of 1557 and related laws.  Now the Biden Administration is actively addressing the scope of the regulations through enforcement positions and proposed revision to the regulations themselves.  

Here is a summary of the status of the key regulatory provisions under Section 1557 and prospects for future changes.

Scope of Regulatory Coverage  

The 2016 regulations had covered essentially all health insurers, prohibiting discriminatory denials, cancellations, limitations, refusals to issue or renew policies, denials and limitation of claims, imposition of discriminatory limitations/restrictions on coverage, and discriminatory marketing practices or benefit design.

The 2020 regulations, which are still in place, removed the blanket application of 1557 to virtually all health insurers.  Currently, only the portions of an insurer’s business that receive federal funding are subject to regulation, and the only applicable federal funding is funding under title 1 of the Affordable Care Act.  The practical effect is that insurers for the most part are no longer subject to Section 1557 regulations.

To date, we do not know whether the Biden Administration will address the scope of coverage through new regulations.  

Scope of Sex Discrimination

1. Transgender Discrimination

The 2016 regulations defined sex discrimination to include discrimination based on gender identity and sex stereotyping (but not sexual orientation).  The gender identity definition explicitly included gender expression/transgender status.  This led to an explicit prohibition on denial of gender transition health care coverage and services, as well as a prohibition on the denial or limitation of services ordinarily available to only one sex/gender when a person of another sex/gender needed those services. 

A federal district court in Texas issued a nationwide injunction on this part of the 2016 regulations before it went into effect.[4]    

The 2020 regulations removed the definition of sex discrimination altogether and instructed health care entities to look to the “plain meaning in the statute,” which the Department of Health and Human Services (HHS) said was a biological binary of male/female based on birth. The 2020 regulations also removed the definition of “gender identity”; removed the requirement that individuals be treated consistent with their gender identity; removed the prohibition on refusing care ordinarily limited to one gender; and removed coverage requirements regarding gender transition services.

Then, in a game-changing opinion, in Bostock v. Clayton County, the U.S. Supreme Court held that Title VII protects employees from discrimination based on gender identity and sexual orientation.[5] In a 6-3 decision, Justice Gorsuch stated: “it is impossible to discriminate against a person for being homosexual or transgender without discriminating against that individual based on sex.”  Id. At 1741.   After Bostock, two federal district courts issue nationwide injunctions against enforcement of 2020 regs re gender identity and sexual orientation.[6]

The Biden Administration wasted no time in following up on Bostock.  One of the President’s first-day Executive Orders stated: “All persons should receive equal treatment under the law, no matter their gender identity or sexual orientation” and ordered agency review of all regulations, policies, guidance, etc., inconsistent with this policy.  On May 10, 2021, HHS said that the Office for Civil Rights would include gender identification and sexual orientation in its interpretation and enforcement of the Section 1557 sex discrimination prohibition. Notably, gender orientation was not in the 2016 regulations, but was approved in Bostock.

While we do not have a new set of regulations from the Biden Administration, there can be no doubt that any new regulations will renew protections for transgender individuals.  Those protections may be broader than the 2016 provisions afforded, as they will incorporate protections based on sexual orientation in accordance with Bostock.  

2. Pregnancy-Related Discrimination 

The 2016 regulations also included pregnancy-related discrimination, including discrimination related to abortion, as part of 1557’s protections against “sex discrimination.”   While the regulation allowed for a religious exemption, it was considered narrow.  This part of the 1557 regulations also was the subject of a nationwide injunction before it went into effect.[7] 

Unsurprisingly, the 2020 regulations eliminated the prohibition on discrimination based on pregnancy and pregnancy termination and created a blanket abortion and religious objection exemption.

The 2020 version remains in place.  The injunction against enforcement of the regulations with respect to pregnancy is still the law, and the Biden Administration stated that it will abide by the injunction.

Limited English Proficiency (LEP) Discrimination

The 2016 regulationsstated that a covered entity must take reasonable steps to provide meaningful access to each LEPindividual eligible to be served or likely to be encountered in a health care entity.  The entity had to evaluate and give substantial weight to the nature and importance of the health program/activity and the particular communication at issue.  The regulations also required covered entities to offer a qualified interpreter when oral interpretation as a reasonable step to provide meaningful access, use a qualified translator when translating written content, and if no live interpreter was available, offer real-time video for foreign language interpreters, using a “sharply delineated image that is large enough to display the interpreter’s face. . . .”

Importantly, the 2016 regulations required health care entities to insert taglines on all  “significant” documents and notices in top 15 languages in the state where the document would be received.  Further, employers with at least 15 employees had to provide notices about nondiscrimination policies, designate at least one employee to carry out 1557 responsibilities, adopt grievance procedures with appropriate due process standards to resolve actions prohibited under Section 1557.

The 2020 regulations made huge changes.  First, they changed the regulatory focus from individual patients to the overall handling of the LEP population.  They stated that when language services are required, they must be free, accurate and timely, and preserve the privacy and independence of the LEP individuals.  To determine whether language services would be required, the 2020 regulations adapted guidance from 2003 to call for a 4 factor test that deemphasized nature of the communication and focused on the number/proportion of LEP eligible/likely to be served; frequency of contact; nature/importance of program/activity; and resources & costs.

The 2020 regulations replaced the requirement that language interpreters be “qualified” with directives that interpreters must translates effectively, accurately, and impartially, both receptively and expressively, using any necessary specialized vocabulary, and must demonstrate proficiency in speaking or understanding, both spoken English and at least one other language.

The 2020 regulations replaced the real-time video requirement with real-time audio over a dedicated high-speed, wide bandwidth video connection or wireless connection that delivers high-quality audio without lags or irregular pauses in communication.

The 2020 regulations deleted the tagline and notice requirements entirely. 

In the LEP area, all of the 2020 revisions to the Obama-era 1557 requirements remain in place.  It remains to be seen whether the Biden Administration will re-impose any of the 2016  provisions; we can speculate that some of the 2020 streamlining may remain. For example, the tagline and multiple language provisions were widely seen as overly burdensome and may not be reimposed. 

Disability Discrimination

In contrast to the LEP discrimination changes, there have been relatively few revisions regarding disability discrimination.

The 2016 regulations required covered entities to provide appropriate auxiliary aids and services to people with impaired sensory, manual, or speaking skills, where necessary to afford an equal opportunity to benefit from the health program or activity.  They adopted the 2010 ADA Standards for Accessible Design for new construction or alternation of facilities of covered entities that receive federal funding and state-based Marketplaces.  And they required covered entities to make reasonable modifications in policies, practices, and procedures to avoid disability-based discrimination, unless doing so would fundamentally alter the nature of the health program or activity.

The 2020 regulation set omitted “acquisition or modification of equipment and devices; and other similar services and actions” from the list of examples of appropriate auxiliary aids and services.  The 2020 regulations left in place the 2010 ADA Standards for Accessible Design, and did not adopt additional exemptions for multi-story building elevators and TTY standards.  And the 2020 regulation set maintained the 2016 “reasonable modification” standards.

There has not been a great deal of attention to the more modest 2020 revisions in this area.  Again, it remains to be seen whether any regulations promulgated in the current HHS will address this area at all.

Grievances/Enforcement

The 2020 regulations made important changes to grievances and enforcement.  First, they deleted the 2016 requirement of a grievance policy and a 1557 coordinator.  Second, they removed the right to sue based on 1557 regulations.  But HHS did acknowledge that a right to sue under the statute itself remains in place.  

Again, we do not know whether HHS will pay attention to this area if and when new regulations are issued.

What’s Next? 

  • It seems likely that there will be further litigation around sex discrimination, probably addressing not only 1557 but Title VI, Title VII and Title IX.
  • The Biden HHS has promised new regulations, but if they follow the timing pattern set by both the Obama and Trump Administrations, we should not  expect them until 2024.
  • We just don’t know whether/to what extent new regulations will restore or expand Section 1557 provisions unrelated to the definition of sex discrimination (e.g., discrimination in health insurance benefit design, language access, notices, grievance procedures, enforcement, covered entities, pregnancy termination).
  • At present, virtually all of the 2020 regulations remain in place.  The extent of enforcement (outside of transgender protections) is unknown.  It may well be that the next iteration of 1557 standards will continue to be narrower than the initial version.   

[1] With thanks to Trent Stechschulte, General Counsel and Compliance Officer, Equitas Health, Columbus, Ohio, whose slides on LEP and disability discrimination are the source of those parts of this blog.

[2] 42 U.S.C. § 18116.

[3]  42 C.F.R. §§ 92.1 et seq.

[4] Franciscan Alliance v. Burwell, 227 F.Supp.3d 660 (N.D. Tx 2016).  On August 9, 2021, the court made the injunction permanent.  Franciscan Alliance v. Becerra, 2021 WL 3492338, N.D.Tex., Aug. 09, 2021.  See https://www.healthaffairs.org/do/10.1377/hblog20210811.110777/full/  for a discussion of the complicated history of this case.

[5] Bostock v. Clayton County, 140 S. Ct. 1731 (2020). 

[6] Whitman-Walker Clinic v. Azar, 485 F. Supp.  3d 1 (D.D.C. 2020); Asapansa-Johnson-Walker v. Azar, 2020 WL 6363970 (E.D.N.Y.)

[7]See note 1.

Deputy General Counsel – Office of Administrative Legal Services

The Office of Administrative Legal Services (OALS) is looking for a highly motivated individual to join our team as a Deputy General Counsel. This position will focus on providing legal services to…

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Staff Attorney – HonorHealth

Requisition IDJob LocationShiftDepartmentFacilityPosition TypePhysical Work LocationWork Hours2021-39997US-AZ Scottsdale01-DaysLegalSupport ServicesRegular Full-Time8125 N Hayden RdMonday- Friday 8am-5pm Overview HonorHealth is a non-profit, local community healthcare system serving an area of 1.6 million…

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