SAMSHA Final Rule: What Docs Need to Know

January 25, 2018

The recently released SAMSHA Final Rule broadens disclosure rules, while a recent case underscores that inaccurate travel expenses submitted to Medicare result in liability.

The recent SAMSHA Final Rule broadens disclosure rules, while a recent case underscores that inaccurate travel expenses submitted to Medicare result in liability.

The Substance Abuse and Mental Health Services Administration (SAMHSA) issued a final rule on January 2nd, which builds upon the major January 2017 Part two update. Prior to these revisions, the regulations had not been changed since its inception in 1975. Here are some main takeaways from the Federal Register (83 Fed. Reg. 239 (Jan. 2, 2018):

• Additional disclosures of patient identifying information under the Confidentiality of Alcohol and Drug Abuse Patient Records in order to promote integrated and coordinated care.

• Reiterated that the January 18, 2017 SAMHSA Final Rule provided for greater flexibility within the healthcare system of disclosing patient identifying information while balancing the need to protect the heightened, sensitive nature of substance abuse records.

• Alignment with HIPAA and the HITECH Act is being explored.

• “In response to comments received that the abbreviated notice did not provide an adequate warning against potential misuse of patient identifying information, SAMHSA, in this final rule, has modified the language in the abbreviated notice to more explicitly notify recipients that improper use or disclosure is prohibited under 42 CFR part.”

• Finalized clarifications as proposed in §2.33(b) except for the list of 17 specific types of payment and healthcare operation activities that a covered entity, business associate or legal representative would be allowed to further disclosed utilizing the minimum necessary standard.

• Emphasis on the public policy behind SAMSHA that, “[u]nauthorized disclosure of substance use disorder patient records can lead to a host of negative consequences, including loss of employment, loss of housing, loss of child custody, discrimination by medical professionals and insurers, arrest, prosecution, and incarceration. The purpose of the part two regulations is to ensure that a patient is not made more vulnerable.”


On December 28, 2017, the United States District Court for the Southern District of Texas held that the owners of BestCare Laboratory Services, LLC are personally liable for $10.6 million in travel expenses that were fraudulently obtained from Medicare. As part of a False Claims Act case, the court found that even though the owners argued that they had no awareness of the billings, because it was a closely held company, either the owner or an authorized representative signed all claims.

In United States ex rel. Drummond v. BestCare Lab. Servs. Inc., No. H-08-2441, BestCare billed Medicare for any and all miles that the specimen traveled, regardless of whether that specimen was accompanied by a technician. Furthermore, when a technician collected and drove samples from the site of collection to other laboratories, instead of allocating a pro rata share, they billed each specimen for the entire trip. Because Defendant Maghareh was directly enriched in this closely held company, he was found personally liable.