Healthcare Law Update – 2025 Year In Review

Happy New Year! We are pleased to provide you with our 17th annual Healthcare Law Year in Review. The 2025 Year in Review highlights some of the most important issues and developments in healthcare, both nationally and regionally, over the past 12 months.

As we close out another dynamic and rapidly evolving year, we are pleased to share our comprehensive review of the key events that shaped the healthcare landscape in 2025. Our team’s insights and ongoing commitment to staying ahead of regulatory, business, and industry developments allow us to provide a thoughtful perspective on the forces continuing to influence healthcare today.

Among the issues covered in this year’s edition are:
• ACF Tax Changes
• NJ Pay and Benefit Transparency
• Medical Debt Relief Act Requirements
• PIP Fee Schedule Amendments
• Coverage for Telehealth in New Jersey
• Sexual Misconduct Prevention Observer Requirements
• FTC Abandons Non-Compete Rule
• Medical Societies File No Surprises Act Case
• CMS Finalizes 2026 Medicare Physician Fee Schedule
• HIPAA and Data Privacy Developments Affecting Providers

In April 2027, we are looking forward to Brach Eichler’s Healthcare Market Review (HMR) in a NEW New Jersey venue. HMR provides a unique opportunity to connect with over 200 attendees, including hospital and ASC executives, physicians, practice owners, managers, and healthcare administrators. During this event, industry experts will address timely topics in both the healthcare and legal arenas, including legislative updates, operational challenges, transaction trends, and strategies for maximizing business and clinical performance.

As always, Brach Eichler’s healthcare law attorneys remain available to provide guidance or assistance with mergers and acquisitions, labor and employment matters, contracts and agreements, litigation and dispute resolution, and all other healthcare-related legal needs. If you have any questions or would like more information regarding any of the articles included in the 2025 Healthcare Law Year in Review, please do not hesitate to contact us.

On June 30, 2025, Governor Phil Murphy signed into law the “Healthcare Finance Enhancement Act,” which brings significant changes to the assessment of ambulatory care facilities, including ambulatory surgery centers, surgical practices, and licensed imaging centers (ACFs). Prior to the passage of the new law, ACFs were required to pay a 2.95% assessment on gross receipts over $300,000, with a cap on the assessment of $350,000. Under the new law, which became effective on July 1, 2025, the assessment is set at 2.5% of gross receipts, and both the floor of $300,000 and the cap of $350,000 have been removed. Further, while certain facilities, such as one (1) room surgical practices, were previously exempt from the assessment, these facilities are now subject to the same assessment.

These changes impact almost every ACF in New Jersey. While many facilities will have a reduced financial burden due to the decrease in the assessment percentage, many other facilities, such as surgical practices, are no longer exempt from an assessment. Additionally, facilities that generate larger gross receipts will be assessed higher amounts, as the $350,000 cap has been lifted, and facilities that generate gross receipts under $300,000 are no longer exempt.

single procedure room surgical facilities that are owned and operated by physicians for use in their private
medical practices. Historically, Registered Surgical Practices were subject to regulation by the New Jersey Board of Medical Examiners, the governing body that regulates the practice of medicine in the State of New Jersey. However, pursuant to legislation enacted in 2017, regulation of Registered Surgical Practices was placed under the authority of the DOH, and Registered Surgical Practices were required to apply to the DOH for licensure as Ambulatory Surgical Centers by January 15, 2019.

The DOH’s responses to the FAQs provide important clarification on licensure, accreditation, compliance obligations, and financial responsibilities for Registered Surgical Practices. Some of the matters addressed by the DOH in its responses to the FAQs include:

• Registered Surgical Practices that failed to apply for licensure as Ambulatory Surgical Centers by the January 15, 2019 deadline are no longer eligible to apply for licensure;

• Registered Surgical Practices are no longer exempt from the ambulatory care facility assessment, and must report revenue beginning in Fiscal Year 2026 and pay the assessment beginning in Fiscal Year 2027;

• Physician owned surgical practices that have a procedure room used for endoscopies, hysteroscopies and cystoscopies that have a sink in the room, or that have a single room only used for pain management, are not required to be licensed;

• Medicare-certified Registered Surgical Practices or Registered Surgical Practices that are accredited by another CMS-recognized body that were in operation as of January 16, 2018 are exempt from certain physical plant requirements under the DOH’s Ambulatory Surgical Center regulations, and other Registered Surgical Practices may apply for a waiver from physical plant requirements if they can demonstrate patient and public safety will be maintained;

• Registered Surgical Practices must seek DOH approval to expand services from conscious sedation to general anesthesia;

• Registered Surgical Practices are exempt from DOH application and renewal fees but are subject to a $2,000 biennial inspection fee; and

• Registered Surgical Practices must seek DOH approval prior to any change in ownership that results in a party owning 10% or more of the ownership of the facility.

As of June 1, 2025, New Jersey employers are required to disclose compensation details when advertising new job openings and notifying employees of internal promotional opportunities. The New Jersey Pay Transparency Act aims to promote pay equity. The law applies to employers (defined broadly to include any persons, companies, corporations, firms, labor organizations, associations, government entities, and municipalities) that have ten or more employees working over 20 calendar weeks and conduct business, employ workers, or accept job applications in New Jersey. Under the law, employers must include information on hourly wages, salaries, or pay ranges, along with a general description of benefits, in all job postings. This applies to both external job openings and internal transfers or promotions. Employers retain flexibility to make upward adjustments to compensation during final salary negotiations when making an official offer. Additionally, employers must maintain records of all job postings, including details about pay range and benefits.

In September 2025, the New Jersey Department of Labor and Workforce Development issued proposed regulations to interpret this Act. The proposed regulations, if adopted, would establish a complaint process, specify notification requirements for job promotions, transfers, and new opportunities, and require transparency in pay ranges. Comments were due on November 14, 2025.

The Louisa Carman Medical Debt Relief Act prohibits medical creditors and debt collectors from reporting medical debt to consumer reporting agencies (e.g. Experian, TransUnion) for healthcare services provided on or after July 22, 2024. A medical creditor includes any healthcare provider, such as a physician, ambulatory surgery center, or hospital, to whom a patient owes a medical debt (i.e., debt arising from the receipt of healthcare services). Any attempt to collect medical debt must include a notice stating that it has not been reported to a consumer reporting agency and that any reported medical debt will be void.

Effective July 22, 2025, the New Jersey law prohibits

medical creditors and medical debt collectors from (i) charging an interest rate on medical debt of more than 3% per year; (ii) garnishing the wages of a patient with an annual income less than 600% of the federal poverty level; (iii) beginning collection actions until after an additional medical bill and notice of the collection action is collection action; and (iv) beginning collection actions sent to the patient at least 30 days before initiating a collection action; and (iv) beginning collection actions until 120 days after the first medical bill for medical debt was sent and the patient has been offered a “reasonable payment plan.” A “reasonable payment plan” is defined as a structured repayment arrangement that satisfies the following criteria: (i) monthly payment amounts set at a level that the patient can reasonably afford or no more than 3% of a patient’s monthly income, if known; (ii) a duration that allows the patient to repay the debt in full within a reasonable timeframe (i.e., between 3 months and 5 years depending on the amount owed); (iii) the terms of the payment plan are documented in a written agreement provided to the patient; (iv) provisions for adjusting the payment amounts and duration in response to changes in the patient’s financial circumstances; (v) a grace period of at least 60 days for late payments; and (vi) charges an interest rate of not more than 3% per year.

Notably, on October 28, 2025, the Consumer Financial Protection Bureau published an interpretive rule of the Fair Credit Reporting Act (FCRA) that stated that, regardless of state law, the FCRA requires that medical debts be reported to consumer reporting agencies, arguing that the FCRA preempts state laws related to the reporting of certain debts, including medical debt. While this interpretive rule does not automatically overturn the Louisa Carman Medical Debt Act, if challenged in court, the portion of the law that prohibits medical creditors and debt collectors from reporting medical debt could be overturned. However, in the event that a court overturns this portion of the law, other key aspects of the Louisa Carman Medical Debt Relief Act, such as requiring that reasonable payment plans be offered to patients, would not necessarily be overturned.

and reimbursement trends.

To modernize the system, DOBI proposes adopting the 75th percentile of FAIR Health in-network allowed data as the primary benchmark for setting reimbursement rates. Where FAIR Health data is lacking, updated Medicare-based calculations will be used. The proposed changes would also expand reimbursable procedures at ambulatory surgical centers (ASCs), add over 5,000 current CPT, CDT, and HCPCS codes, and eliminate outdated codes. The proposed rule would also include revised definitions, clearer formatting, and updated billing modifiers to streamline claim submissions and reduce disputes.

According to DOBI, these updates are designed to align reimbursement with prevailing market rates and improve administrative efficiency. The proposed changes are problematic for certain specialties such as orthopedics and spine surgery, which would face significant reductions to reimbursements if the fee schedule uses in-network rates as a benchmark. For example, arthroscopy procedures could face a 17% decrease in reimbursement under the amendment. At this stage, DOBI has only published a notice of proposed rulemaking for the purpose of seeking preliminary input from stakeholders before issuing a formal rule proposal, after which a public comment period will follow. Clients with an interest in PIP claims or medical billing are encouraged to monitor these developments closely.

On December 31, 2024, Governor Phil Murphy signed into law an extension, from December 31, 2024 until July 1, 2026, of the requirement that health benefit plans in New Jersey reimburse telemedicine and telehealth services at the same rate as in-person services, provided those services are already covered for in-person care under the plan. The law applies to benefit plans that cover hospital or medical expenses for covered services, including those offered by carriers, the State Health Benefits Commission, and the School Employees’ Health Benefits Commission. It also extends to the State Medicaid program and the NJ FamilyCare program, but excludes Medicare. The law also does not apply to healthcare services provided remotely through real-time, two-way audio without a video component, except for behavioral health services.

Effective October 20, 2025, the New Jersey Board of Medical Examiners amended its regulation regarding sexual misconduct prevention, N.J.A.C. 13:35-6.23.

The amendments to the regulation strengthen patients’ rights and clarify licensee responsibilities. Under the amended regulation, the licensee or the patient may request to have an observer present during breast, pelvic, genital, and rectal exams—and may decline care if an acceptable observer cannot be provided. In the event an acceptable observer cannot be provided, then neither the licensee nor the patient is required to proceed with the exam. If the exam is not conducted, the licensee must discuss the risks of delaying care, provide unbiased counseling, and, if possible, refer the patient to another practitioner.

Starting April 18, 2026, to be a qualified “observer”, an observer must complete a CTP-2 training course for as-needed chaperones, which is available through PBI Education, or complete a comparable course approved by the Board. Additionally, an observer must provide an affirmation that the observer has not been subject to discipline or civil/criminal liability for failure to report misconduct or been convicted of a crime that would disqualify the observer from being a licensee under New Jersey law. An observer may not be a friend or relative of the licensee or the patient. A licensee is required to inform the observer in writing that the observer must 1) stay in the exam room; 2) be free from distractions; 3) maintain a clear line of sight of the examination; 4) report any misconduct to the Board; and 5) advise that the licensee will not retaliate against the observer for making any reports.

The amended regulation requires a licensee to notify patients of their right to an observer in writing and by posting a clear notice in all offices. Prior to any exams, the licensee must confirm the patient has read and understood the notice, obtain the patient’s signature, and keep the signed notice in the patient’s file. The required patient notices must be made available

in English, Spanish, and at least 10 additional languages designated by the Division of Consumer Affairs.

The amended regulation provides for 3 exceptions when a licensee will not need to obtain patient signature and confirm patient understanding regarding an observer: 1) emergencies; 2) when the licensee providing the sensitive examination provided the patient with written notice and confirmed understanding within the last 12 months; or 3) when an observer who has already completed training is already present in the normal course of the examination and it is documented in the patient record. In addition to keeping a patient’s signed notice in the patient record, the identity of the observer should also be included in the patient record.

The Board of Medical Examiners clarified in its responses to comments that this regulation will apply to all locations where a licensee provides professional services, other than a health care facility licensed by the New Jersey Department of Health, meaning this regulation will not apply in a hospital or an ambulatory care facility.

The Division of Certificate of Need and Licensing adopted rule N.J.A.C. 8:43E-15 on July 21, 2025 to require licensed healthcare facilities to provide at least one lactation room to be available upon request for the purpose of breastfeeding or expressing milk to persons utilizing on site services. The facility must post signage provided by the Department of Health in the facility’s public waiting room and in each lactation room. The facility must train its staff on the purpose of the lactation room, providing access to the lactation room, maintaining cleanliness of the lactation room, and ensuring privacy while the lactation room is in use.

On April 23, 2024, the FTC adopted the non-compete rule, which would have voided employer contracts, workplace policies, and compensation arrangements that prohibit, penalize, or in practice prevent a worker from working, with a few limited exceptions. At the time, the FTC argued that such agreements suppressed wages and hindered job mobility, thereby stifling competition and innovation in the labor market. However, the rule faced immediate legal challenge. In August 2024, the U.S. District Court for the Northern District of Texas ruled that the FTC lacked the statutory authority to enforce the rule, deeming it “unreasonably overbroad” and “arbitrary and capricious.” The Department of Justice subsequently
filed appeals of the decision.

On September 10, 2025, the U.S. Federal Trade Commission (FTC) issued letters to nineteen large for-profit healthcare systems and staffing firms, urging them to review their non-compete agreements and ensure that any restrictions on employee mobility are in full compliance with the law. These letters follow the FTC’s previous unsuccessful efforts to implement a broad, nationwide noncompete ban, and signal the FTC’s continued commitment to prevent anticompetitive conduct. In a Press Release dated September 10, 2025, the FTC noted that unreasonable non-compete restrictions in healthcare professionals’ employment agreements limit employment options and impact patient access to medical care, especially in rural areas where providers are already stretched thin. Although these letters do not imply any specific wrongdoing, they could trigger a broad wave of reevaluation and scrutiny among for-profit healthcare employers across the nation.

On August 28, 2025, the American Society of Anesthesiologists, the American College of Emergency Physicians and the American College of Radiology filed an Amici Curiae brief to the U.S. Court of Appeals for the Fifth Circuit in Texas Medical Association v. HHS, a case regarding the federal No Surprise Act.

In July 2021, the federal agencies who are appellants in the case—the Department of Health and Human Services, the Department of Labor, the Department of the Treasury, and the Office of Personnel Management—published an interim final rule under the No Surprises Act (NSA) to implement the NSA’s independent dispute resolution process. The rule established a methodology for calculating the qualifying payment amount (QPA) that the physician organizations argue conflicts with the NSA, produces inaccurate QPAs, unlawfully suppresses reimbursement rates for out-of-network physician services and threatens patient access to care.

The physician organizations requested that the Appeals Court affirm the District Court’s judgment invalidating the rule’s provisions that incorrectly calculate the QPA when determining out-of-network payments.

On September 24, 2025, the Fifth Circuit Court of Appeals heard oral arguments in this case. A decision is expected in 2026. Given the central role of the QPA in the NSA framework, the Court’s ruling could have significant implications for physician reimbursement practices and patient access nationwide.

On October 31, 2025, the Centers for Medicare & Medicaid Services (CMS) published the calendar year (CY) 2026 Physician Fee Schedule Final Rule, which takes effect January 1, 2026. The rule updates Medicare Part B payment policies under the Physician Fee Schedule, introduces changes to quality and payment-model programs, and reflects a broader focus on efficiency, transparency and shifting modalities of care. For CY 2026, CMS will use two separate conversion factors: one for practitioners who are Qualifying Participants (QPs) in Advanced Alternative Payment Models (APMs) and another for non-QPs. The final conversion factor for QPs is approximately $33.57, representing a 3.77% increase over the CY 2025 conversion factor; and the non-QP CF is approximately $33.40, representing a 3.26% increase.

The final rule also includes an efficiency adjustment of -2.5% for non-time-based services, reflecting CMS’s view that certain services have become more efficient over time and thus their relative value requires adjustment.

For providers who offer telehealth services, CMS has streamlined the process for adding services to the Medicare Telehealth Services List, eliminating the prior “provisional” versus “permanent” distinction and reducing review steps for whether a service furnished via interactive, two-way audio-video qualifies. In addition, the frequency limitations that previously applied to subsequent inpatient visits, nursing facility visits and critical care consultations delivered by telehealth have been removed. CMS has also finalized rules allowing for direct supervision via real-time audio-video (but not audio-only) for most services that previously required the supervising physician to be physically present. Further, FQHCs and rural health clinics will be permitted to bill for telehealth services through 2026.

The Final Rule also updates several policies affecting drugs and biological products covered under Medicare Part B. CMS maintained the existing refund requirements for discarded amounts of certain single-dose or single-use drugs, and adopted clarifications to how manufacturers should report pricing and service-fee information when calculating average sales price. CMS also confirmed that, beginning in 2026, prices for drugs subject to a “Maximum Fair Price” will be reflected in Medicare’s payment calculations. In addition, CMS finalized operational updates to the Medicare Prescription Drug Inflation Rebate Program aimed at strengthening price-inflation guardrails and improving data accuracy for future rebate determinations.

by the OCR during its investigations into compliance by covered entities and their business associates. The
proposed amendments, if finalized as written, would place substantial enhanced security requirements and, resultingly, significant human resources and financial burdens on covered entities and business associates. The public comment period for the NPRM closed on March 7, 2025. HHS began the process of categorizing and reviewing the comments received and, typically, next steps would be to publish a final rule that may contain amendments from the original NPRM after taking into consideration the public comments.

However, on February 17, 2025, a number of industry groups sent a letter to President Trump and the Secretary of HHS “to express our unified opposition to the proposed HIPAA Security Rule.” The industry groups cited several reasons for their position, including that the breadth and scope of the amendments would place an undue financial strain on hospitals and healthcare systems and would stifle healthcare innovation. In March, the Health Sector Coordinating Council, Cybersecurity Working Group (HSCC CWG) published a Statement on Healthcare Cybersecurity Policy. In the Statement, the HSCC CWG outlined the almost 30 leading practices and guidance documents produced by the working group, including a comprehensive set of cybersecurity controls published in 2019 and updated in 2023, and “initiatives and recommendations that measurably improve our cyber defenses and resiliency to protect patient safety.” The working group advised that the Administration should suspend any further consideration of the NPRM as written and initiate a structured consultative process with the HSCC CWG and other interested parties.

Resultingly, it is unclear whether HHS will follow the typical route of considering the comments to the NPRM and publishing a final rule in due course, or if it will engage in the consultative process recommended by the HSCC CWG prior to publishing the final rule.

In June 2025, a Texas federal court issued an order vacating on a nationwide basis most of the HIPAA Reproductive Healthcare Final Rule. The Final Rule included protections on reproductive healthcare information, including a prohibition on the disclosure of such information by HIPAA covered entities and their business associates for purposes of investigating or prosecuting the provision of legally-performed reproductive healthcare. The Final Rule also required covered entities and their business associates to obtain attestations from requestors of health information stating that the request was not for any of the Final Rule’s prohibited purposes. In addition, each covered entity was required to amend its Notice of Privacy Practices by February 16, 2026 to include, among other things, information about the protection of reproductive health care information and information about the confidentiality of substance use disorder treatment records.

While the provisions of the Final Rule addressing reproductive healthcare were vacated, the provisions requiring amendment of each covered entity’s HIPAA notice of privacy practices regarding heightened protections around substance use disorder treatment records remain intact, with a compliance deadline of February 16, 2026. In addition, HIPAA’s general protections over protected health information (which would include reproductive healthcare information) remain intact.

In June 2025, the New Jersey Division of Consumer Affairs (DCA) published proposed regulations to implement the New Jersey Data Privacy Act (NJDPA). The public comment period ended on August 1, 2025 and we are awaiting publication of the final regulations.

The NJDPA was signed into law on January 16, 2024 and became effective on January 15, 2025. The law gives to New Jersey consumers certain rights regarding their personal data and imposes certain obligations on “controllers” and “processors” of personal data.

Healthcare businesses are not necessarily exempt from the NJDPA. The NJDPA explicitly excludes from the definition of personal data protected under the