ATTORNEY-CLIENT PRIVILEGED
MEMORANDUM
TO:
Deb Roth, Esq.
Staff Attorney
California Primary Care Association
FROM:
Kathy S. Ghiladi
Michael D. Golde
SUBJECT:
Implications of the End of Life Option Act for FQHCs and RHCs
DATE:
July 13, 2016
I.
Introduction
As you know, California’s End of Life Option Act permits terminally ill adult patients
who have the capacity to make medical decisions to be prescribed an aid-in-dying medication if
certain conditions are met. You have asked for an analysis of the impact of this law on
Federally-qualified health centers (“FQHCs”) and FQHC look-alikes and rural health clinics
(“RHCs”), including a discussion of the impact of the State law on federal healthcare programs.
II.
End of Life Option Act
Under the California law, an adult with both the capacity to make medical decisions and a
terminal disease may request to receive a prescription for an aid-in-dying drug if a number of
preconditions are satisfied. Among those preconditions are the requirements that: (1) the
individual’s attending physician has diagnosed the individual with a terminal disease; and (2) the
individual has voluntarily expressed the wish to receive a prescription for an aid-in-dying drug. 1
The individual must make, at a minimum, two oral requests and a written request, with the
timing and format of the requests complying with specific statutory requirements. 2 The
attending physician then must comply with a number of requirements before prescribing an aidin-dying drug. 3
1
Section 443.2(a).
Section 443.3.
3
Section 443.5.
2
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If all the statutory conditions are met, the law anticipates at a minimum the provision of
services by an attending physician and the possible provision of an aid-in-dying drug. 4
Moreover, the law explicitly provides that aid-in-dying activities that are undertaken, pursuant to
and in compliance with the law’s terms, are not suicide. 5
Health care providers (either organizationally or individually) have the ability to refuse to
participate in aid-in dying activities. 6 A health care provider may prohibit its employees,
independent contractors, or other persons or entities, including other health care providers, from
participating in end of life activities while on premises owned or under the management of or
direct control of the prohibiting health care provider or while acting within the course and scope
of any employment by, or contract with, the prohibiting health care provider. 7 Any health care
provider that intends to effectuate such a prohibition must first give notice of the policy
prohibiting participation to the affected individual or entity. Under the State law, any health care
provider that fails to provide such notice shall not be entitled to enforce such a policy against that
individual or entity. 8
By requiring health care providers that wish to “elect” to prohibit their employees or
other persons or entities from participating in aid-in-dying activities under the law to first “give
notice of the policy prohibiting participation” under the law, the End of Life Option Act appears
to allow an individual provider to participate in such activities without penalty from an affiliated
organization unless such election and notice of the organization’s decision to “opt out” is
affirmatively made by that organization.
The potential health center patient population who would benefit from aid-in-dying
services is projected to be a very small number. Due to the federal funding restriction discussed
below, as well as unanswered questions about how the extent federal agencies (e.g., CMS,
HRSA) will monitor and/or apply this restriction to aid-in-dying services, we believe
FQHC/RHCs should tread carefully to avoid inadvertently violating the federal funding
restriction. it is our recommendation that, unless a FQHC/RHC can: (i) affirmatively document
that the facility and staff which will be involved with the provision of aid-in-dying activities
under the Act are not covered by the federal funding restriction; and (ii) develop a
business/service plan for these activities that considers the potential limitations for billing these
services to Medicare/Medicaid or other public third party payors (and potentially private payors
depending on the relevant contractual terms, e.g., the definition of medical necessity), FQHCs
and RHCs take steps to effectuate a prohibition against participation in aid-in dying activities and
to provide meaningful notice of the prohibition to affected employees and other relevant
individuals or entities providing services on its behalf. We believe implementing such a policy
4
The services of a mental health specialist may also be required if there are indications of a
mental disorder. Section 443.6(d). The law also provides for documentation requirements.
5
Section 443.13(a)(2); 443.18.
6
Sections 443.14 and 443.15.
7
Id. at (a).
8
Id. at (b).
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prohibiting aid-in-dying activities under the End of Life Option Act is the most prudent course of
action for the present.
III.
Federal Funding Restriction
Under the federal Assisted Suicide Funding Restriction Act of 1997 9, federal funds
cannot be used either “directly or indirectly” for the provision of health care services “to provide
any health care item or service furnished for the purpose of causing, or for the purpose of
assisting in causing, the death of any individual, such as by assisted suicide, euthanasia, or mercy
killing.” 10
According to the House Report (H.R. No. 105-46) accompanying the 1997 statute, the
principal purpose of the legislation “is to maintain current Federal policy by explicitly providing
that Federal funds may not be used to pay for items and services the purpose of which is to cause
or assist in causing the suicide, euthanasia, or mercy killing of a person. The prohibition on
Federal funding . . . applies to all Federal financial assistance, including the direct purchase of
assisted suicide services and the involvement of Federal personnel or Federal facilities in the
provision of such services.” 11 Congress’ action to maintain and confirm such Federal policy
emanated from concerns over litigation at the time that challenged State bans on assisted
suicides. 12
While this 1997 statute does not define “suicide” and there are no implementing
regulations under the statute that provide a definition, in the legislative history accompanying the
Act, Congress referenced the definition in Webster’s Third New International Dictionary
Unabridged (Merriam-Webster, 1986) of suicide as “the act or an instance of taking one’s own
life voluntarily and intentionally; self-destruction” and of euthanasia as “the act or practice of
painlessly putting to death persons suffering from incurable conditions or diseases.” 13 In
addition, the legislative history defined “assisted suicide” as “the provision of any means
(including, but not limited to, a lethal drug overdose) to another person with the intent of
enabling or assisting that person to kill himself or herself.” 14 In our view, we think a reasonable
interpretation of the 1997 statute would apply to the aid-in-dying activities contemplated by the
California End of Life Option Act.
9
42 USC § 14401 et seq.
42 USC § 14402 (a)(1)(emphasis added).
11
House Report 105-46, 1997 U.S. Code Congressional and Administrative News at 32. We
note that a legal argument could be made that, because of certain provisions of the End of Life
Option Act, aid-in-dying services are categorically determined by California not to be a “cause
of death” or part of the process of “causing death,” and therefore, there is no violation of the
federal funding restriction. Whether federal agencies or courts will adopt this view is not known
at this time.
12
Id. at 33.
13
House Report 105-46, 1997 U.S. Code Congressional and Administrative News at 41.
14
Id. Interestingly, these are the same definitions used in the Legal Service Corporation’s
regulations promulgated under the Act. 45 C.F.R. Part 1643.
10
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The 1997 statute clarifies that federal funding (or other matching payment) may not be
used to pay for such an item or service, including payment of expenses relating to such an item
or service. 15 Federal funding may not be used for “health benefit coverage that includes any
coverage of such an item or service or of any expenses relating to such an item or service.” The
Act specifically states that these restrictions apply to funds appropriated under the Public Health
Service (“PHS”) Act (such as Section 330 grant funds received by FQHCs). 16
The PHS Act was, in turn, amended to provide, “[a]ppropriations for carrying out the
purposes of this chapter shall not be used in a manner inconsistent with the Assisted Suicide
Funding Restriction Act of 1997.” 17 The chapter being referred to is Chapter 6A, which
includes 42 U.S.C. §254b (Section 330 of the PHS Act).
Significantly, other federal healthcare programs specifically covered by the federal
funding restriction include:
•
the Medicare program,
•
the Medicaid program,
•
the Indian Health Care Improvement Act,
•
the Federal employees health benefits program,
•
the military health care system (including TRICARE and CHAMPUS
programs), and
•
Veterans medical care. 18
Community health centers are eligible to receive funding under Section 330 of the Public
Health Service Act. 19 This funding is for the provision of required primary health care services 20
and additional health services 21 to medically underserved populations or to special medically
underserved populations. 22 Under the Medicaid program, a community health center is deemed
a “Federally-qualified health center,” or FQHC, if it is a recipient of funds under Section 330 and
maintains an outpatient health program. 23 “ Federally-qualified health center services . . . and any
15
Id. at (a)(2).
42 USC § 14402(d)(1)(E).
17
42 U.S.C. §238o.
18
42 U.S.C. § 14402(d)(1).
19
42 U.S.C. § 254b.
20
Defined in 42 U.S.C. § 254b(b)(1).
21
Defined in 42 U.S.C. § 254b(b)(2),
22
42 U.S.C. § 254b(a).
23
42 U.S.C. § 1396d(l)(2)(B).
16
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other ambulatory services offered by a Federally-qualified health center” must be covered under
a State’s Medicaid plan. 24 Many FQHCs also provide health care services as part of the Medicare
program. FQHC look-alikes do not receive Section 330 funding, but are required to comply with
health center program requirements.
RHCs are required to have an agreement with CMS to provide RHC services under the
Medicare program. 25 As part of the Medicare program, both FQHCs and RHCs must ensure that
all services are furnished in accordance with applicable Federal, State and local laws. 26
The federal funding restriction further specifies that with respect to health care items and
services “by or in a health care facility owned or operated by the Federal government” or “by
any physician or other individual employed by the Federal government to provide health care
services within the scope of the physician’s or individual’s employment” no such item or service
may be furnished “for the purpose of causing, or for the purpose of assisting in causing, the death
of any individual, such as by assisted suicide, euthanasia, or mercy killing.” 27 These provisions
are made applicable to Public Health Service facilities and personnel by virtue of 42 U.S.C. §
14402(d)(2)(c). While FQHC facilities are typically not “owned or operated by the Federal
government” in the strictest sense, there is often a federal interest in FQHC facilities by virtue of
certain federal awards made to purchase or improve facilities or to fund capital improvements
(further discussed in Section VII below). Additionally, if certain preconditions are met, FQHC
employees are also treated as federal employees for the purposes of the Federal Tort Claims Act
(also further discussed below).
Finally, it is worth noting that the Assisted Suicide Funding Restriction Act by its own
terms does not apply to: “the withholding or withdrawing of medical treatment or medical care”
or the withholding or withdrawing of nutrition or hydration. 28 It also does not apply to “the use
of an item, good, benefit or service furnished for the purpose of alleviating pain or discomfort,
even if such use may increase the risk of death, so long as such item, good, benefit or service is
not also furnished for the purpose of causing, or the purpose of assisting in causing, death, for
any reason. 29
IV.
Intersection Between the State and Federal Laws
As discussed above, federal funding cannot be used (either directly or indirectly) for the
provision of health care services “to provide any health care item or service furnished for the
purpose of causing, or for the purpose of assisting in causing, the death of any individual, such as
by assisted suicide, euthanasia, or mercy killing.” 30 Additionally, federal funding (or other
24
42 U.S.C. §§ 1396d(a)(2)(C) and 1396a(a)(10)(A).
42 C.F.R. § 405.2401 and .2402.
26
42 C.F.R. § 491(a).
27
42 U.S.C. § 14402(c).
28
42 USC § 14402(b)(1) and (2).
29
Id. at (4).
30
42 USC § 14402 (a)(1).
25
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matching payment) may not be used to pay for such an item or service, including payment of
expenses relating to such an item or service. 31 Because of this broad wording and application of
this federal funding restriction and the fact that FQHCs and RHCs are recipients of federal
funding under the Public Health Services Act, mandatory participants in the Medicare/Medicaid
programs through which they receive federal payments, and may participate in other federal
programs pursuant to which they receive federal funds, we believe there exists sufficient conflict
between the federal law establishing the federal funding restriction and the California End of
Life Option Act that will likely preclude most FQHCs and RHCs from participating in the aid-indying activities now authorized under California law.
Notwithstanding the fact that the State law explicitly provides that aid-in-dying activities
are not the equivalent of suicide (potentially reducing the possibility that the two laws would be
viewed as conflicting), because the federal restriction applies to “any health care item or service
furnished for the purpose of causing, or for the purpose of assisting in causing, the death of any
individual” (and suicide is but one example), we believe that this latter restriction effectively
prohibits FQHCs and RHCs from using their facilities and staff who are supported by federal
healthcare funding (directly and indirectly) to provide any component 32 of the aid-in-dying
services under the state law.
V.
Federal Tort Claims Act (FTCA) Considerations
The PHS Act affords immunity to PHS employees by making a claim against the United
States under the FTCA the exclusive remedy for any claim for damages arising out of the PHS
employee’s performance of medical, surgical, dental, and related functions within the scope of
his or her employment. 33 The FSHCAA authorizes the Secretary of the U.S. Department of
Health & Human Services (HHS) to extend the same immunity to health centers and their
officers, directors, and employees (and certain contractors).
FTCA only covers liabilities arising from health services provided within the scope of the
health center’s approved Section 330 grant project. In light of the federal funding restriction, we
have grave doubts as to whether HHS would allow aid-in-dying services to be considered within
the scope of a health center’s Section 330 grant project and, therefore, covered by FTCA, since
such services are expressly prohibited from federal funding support under the federal funding
restriction. In addition, FQHC employees are deemed to be federal employees for purpose of
extending FTCA coverage and the federal funding restriction expressly applies to the services
provided by federal employees. It is possible that FQHCs and their employees participating in
aid-in-dying activities would be precluded from FTCA coverage on these grounds. For these
31
Id. at (a)(2).
The state law contemplates the services of attending and consulting physicians as well as the
possible involvement of mental health specialists.
33
See Federally Supported Health Centers Assistance Act of 1992, Pub. L. 102-501 (Oct. 24,
1992), amended and reauthorized by the Federally Supported Health Centers Assistance Act of
1995, Pub. L. 104-73 (Dec. 26, 1995) (collectively referred to herein as the “FSHCAA”),
codified at 42 U.S.C. § 233(g) et seq.
32
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reasons, we would advise that health centers who rely on FTCA coverage not to presume that the
provision of aid-in-dying services authorized under the State law would be covered by the FTCA.
VI.
340B Drug Program
The 340B Drug Pricing Program allows certain hospitals and other health care providers
to obtain discounted prices on “covered outpatient drugs” from drug manufacturers. Covered
entities are allowed to provide 340B drugs only to individuals who are “patients” of the entity.
While the statute does not define who should be considered a patient of the entity, the Health
Resources and Services Administration (“HRSA), which administers the 340B program, has
outlined criteria for who is an eligible patient. An individual is not considered a patient if the
only service that he or she receives from the entity is the dispensing of a drug for subsequent
self-administration or administration in a home setting.
The 340B Program does not provide a specific formulary as to which outpatient drugs are
provided under the program. http://www.hrsa.gov/opa/eligibilityandregistration/index.html.
Therefore, we are unable to determine whether the drugs most likely to be used in aid-in-dying
activities would be covered outpatient drugs under the program. Moreover, there is no clear
legal guidance as to whether the discount afforded by the program would be considered federal
funds subject to the federal funding restriction. Since the federal funding restriction applies to the
PHS and HRSA, which administers the 340B Program, is housed within the PHS, absent further
federal guidance on the issue, the conservative approach would be to presume that aid-in-dying
drugs do not fall within the purview of the 340B Program.
VII.
Providing Aid-in-Dying Services Outside of an FQHC’s Section 330-Supported
Program
According to a May 2016 Medi-Cal Estimate prepared by the California Department of
Health Care Services, the State anticipates that the full cost of the new state law for fiscal year
2016-2017 will be approximately $1.3 million in State funding. State funding is listed as the
only funding source for the new law. This could lead one to ask whether an FQHC could use
only State funds to provide end of life services. The answer would depend on a number of very
fact-specific considerations.
HRSA has long-recognized that health centers may provide certain services or programs
outside of their Section 330-Supported Programs (or outside of their “scope of project”). In its
scope of project policy from 2008, HRSA indicated that:
“A section 330 grantee’s approved scope of project may be part of a larger health
care delivery system and, as such, must be distinctly defined within that context.
Section 330 funded health centers may carry out other activities (i.e., other lines
Page 8 of 9
of business) that are not part of their scope of project and, thus, are not subject to
section 330 requirements and expectations.” 34
It is important to remember that if a health center is operating certain services outside of its
Section 330-Supported Program, it cannot support such “out-of-scope” services with Section 330
funds and it must ensure that the costs, revenues, and operation of such services are appropriately
segregated from the Section 330-Supported Program consistent with appropriate grants
management rules. A center must also ensure that it is able to document such segregation.
It is also worth bearing in mind that Section 330 grantees may take advantage of various
federal funding opportunities for construction or major renovation of their health center sites.
The federal government retains a federal reversionary interest in all real property acquired or
improved with federal funds. 35 “Federal interest” is defined as “the dollar amount that is the
product of the: (1) [F]ederal share of total projects costs; and (2) current fair market value of the
property, improvements, or both, to the extent the costs of acquiring or improving the property
were included as project costs.” 36 If the federal government has a federal interest in a health
center grantee’s real property, the health center grantee must use the real property “for the
originally authorized purpose as long as needed for that purpose, during which time the nonFederal entity must not dispose of or encumber its title or other interests.” 37
If the health center grantee determines that the real property is no longer needed for the
purpose of the original project, it must “obtain written approval from the HHS awarding agency
for the use of real property in other federally-sponsored projects” or for other “programs that
have purpose consistent with those authorized for support by the HHS awarding agency.” 38
Determining whether this federal interest would restrict the ability of the health center to
provide services outside of its Section 330-Supported Program in said facility would require an
examination of several factors, such as the language in the federal funding opportunity
announcement and the general and specific terms and conditions of the notice of grant awards.
Additionally, health center grantees that receive a grant award for some construction or
improvement projects may be required to file a notice regarding the federal government’s
reversionary interest in the real property in the county or district office in which the facility is
located. 39 HHS has included a sample notice of federal interest in certain construction and
improvement grant awards which lists restrictions on how the acquired or improved property
may be used, “specifically, the property may not be (1) used for any purpose inconsistent with
the statute and any program regulations governing the award under which the property was
34
HRSA Policy Information Notice (PIN) #2008-01: Defining Scope of Project and Policy for
Requesting Change (December 31, 2007, as amended January 13, 2009) at p. 3.
35
45 C.F.R. § 75.2.
36
45 C.F.R. § 75.2.
37
45 C.F.R. § 75.318(b)(1).
38
45 C.F.R. § 75.318(b)(2).
39
HHS Grants Policy Statement – January 2007, Section II-67.
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acquired.” 40 In this regard, we note that the federal funding restriction prohibits federal funds
from being used either directly or indirectly to pay for services furnished for the purpose of cause,
or for the purpose of assisting in causing the death of any individual. By using “indirectly” it
would appear that Congress sought to ensure a complete separation of federal funding from any
aid-in-dying activity.
VIII. Conclusion
We recognize that the thinking behind end of life activities has evolved since 1997, as
evidenced by States enacting laws authorizing such activities and providing related liability
protections. However, the broadly phrased and overarching federal funding restriction remains
“on the books” and still applies to federal funds under or to carry out the PHS Act, Medicare, and
Medicaid programs, among others. In our view, there is a substantial likelihood that the aid-indying activities authorized under the State law could be deemed to involve activities prohibited
by the federal funding restriction. Accordingly, for FQHCs and other entities that (i) accept the
terms and conditions of federal funding under the PHS Act, or (ii) intend to receive payments
funded by federal healthcare benefit programs such as Medicaid and Medicare, we believe
implementing a policy and procedure prohibiting aid-in-dying activities under the End of Life
Option Act is the most prudent course of action for the present and the most direct means of
demonstrating compliance with the federal funding restriction. The existing level of uncertainty
surrounding how and by whom the federal funding restriction would be enforced further merits
the adoption of a conservative approach for federally-funded entities at this time. 41
If an entity believes its particular funding or facility situation may place them outside the
federal funding restriction and desires to participate in aid-in-dying activities, we recommend
that such an entity, in consultation with counsel, conduct a specific analysis of its circumstances
vis-à-vis the federal funding restriction. This analysis should include, at a minimum: (i) an
assessment of the scope and terms of the federal funding it has received; (ii) the extent to which
the expenditure of those funds are properly documented and allocable; (iii) how that funding is
allocated; and (iv) an assessment of the circumstances with respect to its facilities (e.g., is there a
federal interest).
We appreciate the opportunity to provide you with this analysis and look forward to
answering any questions you may have.
40
HRSA-12-115, Appendix B: Sample of Notice of Federal Interest.
It is unclear whether the funding restriction would be enforced via a cost disallowance, threat
of or debarment from participation in federal healthcare programs, sanctions/threats to
licensure/certification, or other actions.
41