Wade’s Health Law Highlights for October 7, 2025

Alternative Medicine

• Texas Medical Board now requires physicians to obtain structured consent before providing complementary and alternative medicine therapies. Effective January 2025, the rules apply to any non-conventional treatment including peptides, stem cells, and exosomes, regardless of FDA approval status. Physicians must use an unmodified TMB consent form that covers assessment requirements such as medical history, physical exams, and discussion of conventional treatment options. The disclosure process requires documentation of treatment objectives, risks and benefits, regulatory status of substances used, and plans for periodic review of patient progress. The executed form must become part of the patient’s medical record and cannot be customized beyond translation or supplemental pages. Source: Healthcare Empowered

Devices & Wearables

• Patients are managing their own healthcare through direct-to-consumer tests, wearable devices, and AI chatbots due to doctor shortages and long appointment wait times. Companies like Quest Diagnostics now offer more than 150 direct-to-consumer lab tests ranging from $29 complete blood counts to $385 comprehensive health profiles analyzing over 75 markers. Two-thirds of adults use smartphone apps to track health information, while new devices can monitor heart rhythm for $79-$129, screen for sleep apnea, and measure blood pressure without cuffs. Patients and caregivers are turning to ChatGPT and other AI chatbots to diagnose symptoms, manage chronic diseases, and research treatments for serious conditions. Harvard Medical School professor Dr. Tom Delbanco notes that evidence shows patient involvement in their own care leads to better outcomes, though the trend carries risks including reliance on information not reviewed by clinicians and data privacy concerns. Source: WSJ

Emerging Tech

• AI models demonstrate high accuracy in diagnosing skin conditions in low- and middle-income countries but face equity challenges, according to a systematic review of 19 studies. The review found that AI systems achieved accuracy rates up to 99% in detecting skin cancer and infectious diseases like monkeypox, with 63% of studies showing AI outperformed dermatologists in diagnostic accuracy. However, significant disparities emerged when AI systems trained primarily on Caucasian datasets were tested on darker skin tones, with one study finding accuracy dropped from 69.9% for Caucasian patients to just 17% for Black patients in Uganda. The research covered conditions including skin cancer, monkeypox, facial aging analysis, acne, and burn depth estimation across Africa, Asia, and global datasets. Most studies exhibited moderate to high risk of bias due to small sample sizes and limited real-world validation, highlighting the need for diverse datasets and lightweight mobile-compatible models for equitable implementation. Source: International Journal of Emergency Medicine

Fraud & Abuse

• The OIG identified billing practices that warrant scrutiny in Medicare’s remote patient monitoring program after payments reached $536 million in 2024. The August 25, 2025 report found Medicare payments for RPM services increased 31% from 2023, with nearly one million Medicare enrollees receiving services from approximately 4,600 medical practices. The OIG flagged concerning billing patterns including 45 practices billing for patients with no prior medical relationship, 52 practices billing for patients who never received treatment management, and instances of multiple practices billing the same enrollees or providers billing for multiple devices per patient monthly. The findings follow previous fraud alerts and precede an upcoming 2026 audit of Medicare Part B RPM services announced in December 2024. Healthcare providers face increased scrutiny and audit risk as the OIG calls for CMS to implement safeguards to monitor these billing patterns. Source: The FCA Insider

HIPAA

• Texas enacted SB 1188 to regulate electronic health records and artificial intelligence use in healthcare. The law, which took effect September 1, 2025, requires all EHRs containing Texas patient data to be physically stored in the United States beginning January 1, 2026. SB 1188 applies to healthcare entities, third-party vendors, cloud service providers, and subcontractors that manage or store EHRs. The legislation mandates disclosure when AI is used for diagnostic purposes, requires EHR systems to include dedicated fields for biological sex at birth, and prohibits collection of patient credit scores or voter registration data. The law authorizes civil penalties against entities that violate its requirements. Source: Buchalter
• Cadia Healthcare Facilities paid $182,000 to settle HIPAA violations after posting patient success stories without proper authorization on their websites and social media. The Department of Health and Human Services Office for Civil Rights investigated the five Delaware nursing homes following a complaint that the chain disclosed patient names, photographs, and health information without valid written HIPAA authorization. The investigation revealed that Cadia disclosed protected health information for 150 patients across its websites, despite having policies requiring written consent forms. Under the settlement agreement, Cadia must implement a two-year corrective action plan monitored by OCR, provide workforce training on HIPAA policies, and notify all affected individuals of the potential breach. The company apologized and stated it had enhanced its privacy policies and increased employee training. Source: McKnight’s Senior Living

Marketing

• Texas defends its text marketing law by arguing it targets spam messages rather than consent-based business communications. Texas Senate Bill 140, signed by Governor Greg Abbott on June 20, 2025, and effective September 1, 2025, requires businesses using text message telemarketing to register with the secretary of state, pay a $200 fee, post a $10,000 security bond, and submit quarterly reports. The state filed a brief opposing a preliminary injunction request from plaintiffs including an industry association and two e-commerce companies who challenged the law in federal court. Texas argued the law excludes transmissions that mobile customers have agreed to receive and focuses on stopping deceptive solicitations without permission. The law includes a “customer” exemption for businesses that have operated under the same name for at least two years when soliciting current or former customers. Source: The National Law Review

Medicare Advantage

• A federal judge in Texas vacated a Medicare Advantage audit rule that would have allowed the government to recover billions from insurance companies. Judge Reed O’Connor ruled that the Centers for Medicare & Medicaid Services failed to provide notice and comment when it eliminated the Fee-for-Service Adjuster method that had been used since 2012 to calculate audit overpayments. The 2023 rule would have allowed CMS to apply a new methodology retroactively to 2018 and could have recovered up to $4.7 billion from Medicare Advantage organizations between 2023 and 2032. Humana challenged the rule, arguing it was arbitrary, unlawfully retroactive, and improperly promulgated. CMS must now continue using its previous methodology until any new proposal goes through proper rulemaking channels. Source: Humana v. Xavier Becerra – Order

Mergers & Acquisitions

• The FTC moved to block private equity firm GTCR’s $627 million acquisition of medical device company Surmodics in the Trump administration’s first merger challenge. The FTC alleges the merger would combine the two largest providers of hydrophilic coatings used in medical devices, resulting in a market share exceeding 50% and concentration levels that surpass antitrust guidelines. The Commission voted unanimously in March 2025 to file suit, arguing the transaction would eliminate competition between direct competitors in a market with high entry barriers. The case signals a shift from the Biden administration’s focus on private equity transactions to more traditional antitrust theories centered on market concentration and competitive harm. Healthcare transactions remain a priority for antitrust enforcers regardless of political administration, reflecting the industry’s impact on patients and the economy. Source: Jones Day
• Healthcare transaction due diligence requires a fundamentally different approach than other industries due to regulatory complexity and constant change. Healthcare deals face challenges including regulatory exposure, reimbursement risk, compliance pitfalls, and cybersecurity threats, with oversight from CMS, DOH, OIG, HIPAA and commercial payer policies making compliance more difficult than most industries. Coding and billing errors can trigger claim denials, payment delays, reduced payments, and legal exposure, while annual updates to CPT and ICD codes mean rules change constantly. Historical performance fails to predict future results because reimbursement models, regulatory frameworks, and care delivery models remain in flux, forcing investors to develop forward-looking approaches that assess how policy changes will reshape revenue models. Technology tools like analytics platforms now enhance due diligence by providing targeted sampling and audit insights, while collaboration between finance and coding teams delivers a complete view of risks and opportunities rather than isolated findings. Source: VMG Health

Patient Safety

• Florida will require Level 2 background screenings for nearly all healthcare practitioners starting July 1, 2025, under House Bill 975. The law expands fingerprint-based criminal history checks from a select group of healthcare professions to include dentists, pharmacists, therapists, social workers, and dozens of other licensed practitioners. New applicants must complete the screening before licensure, while current practitioners must undergo screening at their first renewal on or after the effective date. The law also expands the list of criminal offenses that can disqualify someone from holding a healthcare license, including abuse, fraud, and certain felonies. Practitioners who fail to complete the screening cannot have their licenses renewed, which immediately revokes their authority to practice in Florida. Source: Health Care Law Matters

Pharmaceuticals

• The Trump Administration plans to impose tariffs on pharmaceutical imports, ending decades of duty-free trade for the industry. The administration is conducting a Section 232 investigation into pharmaceutical imports’ impact on national security, with President Trump and key officials expressing intent to introduce tariffs in the near future. Companies must review supply agreements to identify which entity serves as importer of record, as this entity bears legal responsibility for paying tariffs on U.S. imports. Pharmaceutical companies can potentially reduce tariff exposure through the “first sale” rule, which allows dutiable value to be based on the price between manufacturer and intermediary rather than the subsequent sale to the U.S. importer. Companies should also evaluate tariff-free exemptions for products used in research and development activities and consider modifications to supply chains involving chemical compounds and bulk drug substances. Source: Jones Day

Telehealth

• Medicare telehealth flexibilities expired for the first time since the COVID-19 pandemic, ending nearly five years of extensions and forcing coverage to revert to pre-pandemic rules. Under the restored regulations, most Medicare beneficiaries can no longer receive telehealth services from home and must instead visit specific sites such as provider offices, hospitals, or skilled nursing facilities located in rural professional shortage areas outside metropolitan statistical areas. The changes also reinstate restrictions on which practitioners can provide telehealth services and limit audio-only telehealth to certain circumstances. The Centers for Medicare and Medicaid Services advised providers through an October 1 newsletter to consider sending Advance Beneficiary Notices of Noncoverage to Medicare patients continuing telehealth care and directed Medicare Administrative Contractors to hold claims for 10 days. Healthcare providers must now reassess their telehealth operations to comply with the pre-pandemic requirements while the industry awaits potential Congressional action. Source: BakerHostetler