Our series highlighting recent activity by the NYS Legislature continues with a recap of bills passed in 2018 that relate to behavioral health. This synopsis follows previous summaries we have done concerning pharmacy (here), hospitals (here), long term care and aging (here).

Except where otherwise noted, these bills await action by the Governor.

Mental Health and Substance Use Disorder Parity Report (A3694-C by Assemblymember Gunther / S1156-C by Senator Ortt):  This legislation would establish the Mental Health and Substance Use Disorder Parity Report Act, which, beginning September 1, 2019,  would require the Department of Financial Services (DFS) to include in the annual Consumer Guide to Health Insurers (here) information concerning insurers’ and health plans’ compliance with NYS and federal requirements for the provision of mental health and substance use disorder treatment.

Insurers and plans would be required to annually provide the DFS and Department of Health (DOH) all of the information necessary to prepare the report, including:

  • Rates of utilization review for mental health and substance use disorder (SUD) claims as compared to medical and surgical claims, including the rates of approval and denial, categorized by benefits provided by the following classifications: inpatient in-network, inpatient out-of-network, outpatient in-network, outpatient out-of-network, emergency care, and prescription drugs;
  • The number of prior or concurrent authorization requests for mental health and SUD services and the number of denials, compared with similar authorization requests for medical and surgical services, categorized by the same classifications noted above;
  • Rates of appeals, adverse determinations, adverse determinations upheld and overturned for mental health and SUD services, as well as such rates for medical and surgical claims;
  • The percentage of claims paid for in-network and out-of-network mental health and SUD services compared with in-network and out-of-network medical and surgical services;
  • The number of behavioral health advocates or staff that are available to assist policyholders with mental health and SUD benefits, pursuant to an agreement with the Attorney General’s office;
  • A comparison of cost sharing requirements, co-payments, co-insurance, and benefit limitations between mental health and SUD services and medical and surgical services;
  • The number and type of providers licensed in NYS that provide mental health and SUD services in-network and the number of providers that are out-of-network;
  • The percentage of providers of services for mental health and SUD who remained participating providers; and
  • Any other information DFS determines necessary to track mental health and SUD parity, including but not limited to an evaluation of: the company’s in-network mental health and SUD provider panels and reimbursement practices for in-network and out-of network services compared with those of medical and surgical services.

Discharge Planning for Individuals with Mental Health Disorder (A10644 by Assemblymember Gunther / S8769 by Senator Ortt):  This legislation would require the Office of Mental Health (OMH), in conjunction with DOH, to develop guidance and educational materials regarding effective discharge planning for individuals with a mental health disorder.  Information will be provided to hospitals across NY and would also be provided to individuals with a documented mental health disorder or those who appear be at risk for a mental health disorder during the discharge planning process.  This legislation was previously highlighted in our post on legislation affecting hospitals (here).

Maternal Depression Treatment (A8953 by Assemblymember Richardson / S7409 by Senator Krueger):  This legislation makes technical amendments to Chapter 463 of 2017 (S4000/A8398), which would have required DOH, in collaboration with the OMH, to compile and maintain a list of providers who treat maternal depression, and ensure adequate investment in treatment resources, including a statewide hotline, peer support, adequate referral networks and telehealth or telemedicine services.  This bill amends that law to instead require DOH, in consultation with OMH, to simply “inform providers of the need to raise awareness and work to address maternal depression,” and to provide information on their websites to assist people in locating mental health professionals, other licensed professionals, peer support, not-for-profit corporations and other community resources that treat or provide support for maternal depression.  The bill was signed by the Governor on June 1, 2018.

Mental Health and Home Care Collaboration (A10938 by Assemblymember Gunther / S8632 by Senator Ortt):  This legislation would allow the existing Geriatric Service Demonstration Program, which provides grants to providers of mental health care to the elderly (here) to foster and support collaboration between mental health providers and home care services, including certified home health agencies and licensed home care service agencies.  It is intended to help promote integrated physical and mental health care services in NYS communities for individuals with co-occurring physical and mental health needs.

Tick-Borne Disease Study (A9019-A by Assemblymember Gunther / S7171-A by Senator Serino):  This legislation would require DOH, in conjunction with OMH, to conduct a tick-borne diseases and blood-borne pathogen impact study to examine their impact on  mental illness rates in endemic areas of the state.  This report would be due by October 1, 2019 and would detail:

  • Considerations on how Lyme, tick-borne illnesses and other blood-borne pathogens or vector-borne diseases may have correlations with mental illness in infected individuals;
  • Populations at risk, including individuals that work outside or that have elevated exposure risks;
  • Diagnostic indicators of mental illness that can be used as guidance for health and mental health providers;
  • Historical considerations of infection rates and mental illness indicators that may have gone undiagnosed or misdiagnosed in endemic areas; and,
  • Recommendations for intervention and coordinated care for individuals who exhibit mental illness symptoms and also have physical health indicators.

Effects of Trauma on Child Development (A10063-B by Assemblymember Joyner / S8000-B by Senator Bailey):  This legislation would require the Commissioner of Education to conduct a study on the effects of trauma on child development and learning.  The study would include, but not be limited to, the following information:

  • The types of trauma experienced by students;
  • The impacts of trauma on child development and learning;
  • Screening and assessments of trauma available in schools;
  • Programs, interventions, and services related to trauma available in schools; and
  • Best practices for school personnel in the area of trauma as it relates to child development and learning.

The State Education Department (SED) would be required to submit its findings and recommendations to the Governor and NYS Legislature within one year.

Suicide Prevention Education (A3210-A by Assemblymember Ortiz / S5860-A by Senator Ritchie):  This legislation would require OMH, in consultation with SED, to develop and publish educational materials regarding suicide prevention measures and signs of depression among students in  NYS universities, community colleges, and city universities.  Such educational materials would include, but not be limited to:

  • Information regarding symptoms of depression;
  • How depression manifests itself in different cultures;
  • Warning signs of suicide;
  • Actions to take once a student is identified at risk of suicide; and
  • A list of educational websites regarding suicide and students attending university or college.

These educational materials would be available to faculty and staff in these educational institutions via the OMH website and by any other means OMH deems appropriate, within 90 days after it is signed into law.

Adolescent Suicide Prevention (A8961 by Assemblymember De La Rosa / S7322 by Senator Alcantara):  This legislation makes technical amendments to Chapter 436 of 2017 (S5500-C/ A7225-B), which would have established a nine-member Adolescent Suicide Prevention Advisory Council to facilitate the coordination of adolescent suicide prevention services.  As outlined in the Governor’s 2017 approval memo, the bill presented implementation challenges.  The current bill would repeal the prior bill and instead require OMH to assure the development of plans, programs, and services in the research and prevention of suicide, to reduce suicidal behavior and deaths through consultation, training, implementation of evidence-based practices, and use of suicide surveillance data.  OMH would develop such plans, programs, and services in cooperation with other agencies and departments in NYS, local governments, community organizations, entities, and individuals.  OMH would also consider the impact of differing demographic groups, gender, race and ethnicity, cultural and language needs.

Substance Use Education (A7470 by Assemblymebmer Davila / S8318 by Senator Comrie):   This legislation would require the Office of Alcoholism and Substance Abuse Services (OASAS), in consultation with SED, to develop educational materials to be provided to school districts and boards of cooperative educational services for use in any drug and alcohol related curriculum regarding the misuse and abuse of alcohol, tobacco, prescription medication and other drugs.  These materials would be age appropriate, and to the extent practicable, include information for parents to identify the warning signs and to address the risks of substance abuse.

Additionally, the bill would require the Superintendent of each school district, in consultation with the related district superintendent of a board of cooperative educational services, to designate a member of the school district’s staff or an employee to provide information to any student, parent, or staff regarding available substance use related services.  Where practicable, this individual should be a school social worker, school guidance counselor, or any other health practitioner or counselor employed by the school.  These designated individuals will be required to undergo any necessary training required by OASAS.  Information received by designated individuals would be kept confidential, however, nothing would relieve them of any legal duty to otherwise report such information.

Substance Abuse Disorder Referrals (A7689-A by Assemblymember Rosenthal / S6544-B by Senator Akshar):  This legislation would prohibit any SUD provider from intentionally soliciting, receiving, accepting or agreeing to receive payment, benefit, or any other consideration to induce the referral of a potential patient for SUD services.  This legislation does not prohibit:

  • Lawful payments by a health maintenance organization or health insurer acting on behalf of their enrollees for such SUD services or benefits to be provided;
  • Lawful payments to or by a provider to a health maintenance organization or health insurer as payment for services provided, a refund for an overpayment, a participating provider fee, or any similar remuneration;
  • Payment for an activity that, at the time of such activity, would have been lawful as specifically exempt, or otherwise not prohibited under any federal statute or regulations, including but not limited to 42 U.S.C. § 1320a-7b, or the regulations promulgated thereafter if conducted by a person, firm, partnership, group, practice, association, fiduciary, employer representative or any other entity providing SUD services;
  • Any employee or representative of a provider conducting marketing activities, where the employee or representative identifies the provider represented for whom the employee works, identifies themselves as a marketer and not a clinician or individual who can provide diagnostic, counseling or assessment services;
  • Commissions, fees or other remuneration lawfully paid to insurance agents as provided under the Insurance Law.

Providers who intentionally violate these provisions would be guilty of a misdemeanor as defined under the Penal Law.

OASAS Provider Directory (A8151 by Assemblymember Rosenthal / S8552 by Senator Golden):  This legislation would require OASAS to maintain a directory of all providers and programs operated, licensed, or certified on their website.  The searchable directory would include the following information:

  • Location(s) of each provider or program;
  • Contact information for each provider or program;
  • Services offered by each provider or program at each location of the provider or program, as well as which medications are available at any medication-assisted treatment provider;
  • Special populations served;
  • Insurance accepted;
  • Availability of beds and services; and
  • Any other information OASAS deems appropriate.

Medical Marihuana as Alternate Treatment for Substance Use Disorder (A11011B Rules, Assemblymember Gottfried / S8987-A by Senator Amedore):  As we previously reported in another blog post, this legislation would help provide alternative treatment options for pain management and substance use disorder by including “pain that degrades health and functional capability where the use of medical marihuana is an alternative to opioid use” and “substance use disorder” to the list of qualifying conditions for patients to access medical marihuana.

Notice of Service Reductions at State-Operated Hospitals (A9563-A by Assemblymember Gunther / S7207 by Senator Ortt):  This legislation amends the notice requirements to local governments, community organizations and other interested parties regarding the potential for significant service reductions at state-operated hospitals.  The bill would require notice of closure or significant service reductions at state operated hospitals and state operated research institutes be a maximum length of twenty-four months prior to commencing such service reduction.  This legislation is intended to allow appropriate planning to take place and ensure a thoughtful transition plan is developed for all affected stakeholders.

Continuing Education for Psychologists (A9072-A by Assemblymember Fahy / S7398-A by Senator Valesky):  This legislation would require psychologists to obtain a minimum of 36 hours of mandatory continuing education, including 9 hours of professional ethics, every 3 years.

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For additional information on any of the foregoing bills, please do not hesitate to contact Farrell Fritz’s Regulatory & Government Relations Practice Group at 518.313.1450 or NYSRGR@FarrellFritz.com.

 

 

With so much happening in the cannabis industry we thought we’d take this time to highlight some of the industry’s most recent happenings.

  • Increasing Support for Decriminalization of Marijuana (Federal): On April 20, 2018, Senate Minority Leader Chuck Schumer of New York said he’ll introduce a bill taking marijuana off the federal list of controlled substances — in effect decriminalizing its use at the federal level. The bill is expected to be similar to the one proposed by Senator Cory Booker (D-NJ) in 2017. In a tweet to his Twitter followers Chuck Schumer stated: “The time has come to decriminalize marijuana. My thinking – as well as the general population’s views – on the issue has evolved, and so I believe there’s no better time than the present to get this done.”

FDA Approves Marijuana-Derived Drug (Federal): On April 19, 2018, advisers for the Food and Drug Administration unanimously supported the first-ever government approval of a medication made from cannabis. The drug, Epidiolex, is made from a purified ingredient in cannabis called cannabidiol, or CBD. It is intended to treat severe seizures in children caused by rare forms of epilepsy called Lennox-Gastaut and Dravet syndromes.

Cole Memorandum Update (Federal): On January 5, 2018, we discussed the rescission of the Cole Memorandum by the federal government. The Cole Memorandum outlined the federal government’s general policy prohibiting federal prosecutors from pursuing cases against people following marijuana laws in states that have legalized the drug. The rescission of the Cole Memorandum created much concern and confusion at the state level. In a change of direction, President Donald Trump stated on April 13, 2018, that he will support legislation protecting the marijuana industry in states that have legalized the drug. Republican Sen. Cory Gardner (D-CO) said that President Trump made the assurance to him during a conversation. “President Trump assured me that he will support a federalism-based legislative solution to fix this states’ rights issue once and for all,” Gardener said in a statement.

Marijuana Key Issue in Governorship Race (New York): In February 2018, we discussed Governor Cuomo’s statement during his annual budget address that New York should undertake a study of the possible impacts of legalizing recreational marijuana. The issue of legalization recreational marijuana at a state level is becoming a key issue for his campaign, especially in light of Cynthia Nixon’s recent comments. Ms. Nixon, who is challenging Governor Cuomo in a Democratic primary for the governorship, supports the decriminalization of marijuana. “I believe it’s time for New York to follow the lead of eight other states and D.C. and legalize the recreational use of marijuana,” says Ms. Nixon in a video she posted to Twitter.

New Medical Marijuana Dispensaries Poised to Open (New York): In Medical Marijuana 102 we reviewed New York medical marijuana dispensaries and the issuance by the NYS Department of Health (“DOH”) of licenses to five new companies in addition to the original five companies chosen by the DOH to manufacture and sell medical cannabis. The five new companies will be opening up a total of six New York City dispensaries, one of which will be in Manhattan, bringing the total number of medical marijuana dispensaries to nine.

Number of Certified Patients and Practitioners Continues to Rise (New York): In Medical Marijuana 103, we noted that 1,184 practitioners had registered with the DOH for the purpose of certifying patients for medical marijuana use and that 28,077 patients had been certified for such use. That number has grown exponentially since then – the DOH reports that as of April 17, 2018, there are now over 1,500 registered practitioners and over 50,000 certified patients.

As we’ve discussed in previous blog posts, marijuana, whether used for medicinal or recreational purposes, is classified as a Schedule 1 drug under the Controlled Substances Act (CSA). The CSA prohibits the manufacturing, distributing, dispensing or possession of certain controlled substances, including marijuana and marijuana-based products and services. In addition, the CSA makes it unlawful to sell, offer for sale or use any facility of interstate commerce to transport illegal substances, including marijuana.

In August 2017, U.S. Senator Cory Booker (D-NJ) and Representative Barbara Lee (D-CA) introduced bills to both chambers of Congress – the Marijuana Justice Act of 2017 – that seek to remove marijuana completely from the list of controlled substances, making it legal at the federal level.

Last year U.S. Senator Ron Wyden (D-CA) was the first senator to co-sponsor the Marijuana Justice Act. On Wednesday, February 14, 2018, New York Senator Kirsten Gillibrand announced that she is also co-sponsoring the Marijuana Justice Act to end the federal prohibition on marijuana.

“Legalizing marijuana is a social justice issue and a moral issue that Congress needs to address, and I’m proud to work with Sen. Booker on this legislation to help fix decades of injustice caused by our nation’s failed drug policies,” Gillibrand said in a statement.

The Marijuana Justice Act aims to implement a number of reforms relating to marijuana. The most significant reform would be the removal of marijuana from the list of controlled substances in the CSA. Such a reform would effectively end the federal criminalization of marijuana.

Other reforms proposed by the Marijuana Justice Act include: (1) providing incentives to states to reduce racial disparities in connection with arrests made for marijuana; (2) expunging federal convictions relating to marijuana possession; (3) allowing individuals serving time in federal prison for marijuana-related offenses to petition the court for resentencing; and (4) developing a community reinvestment fund to invest in communities most impacted by the failed War on Drugs, such as by providing in-job training programs, educational opportunities, public libraries and community centers.

There is growing support for removal of marijuana as a Schedule I drug under the CSA, especially as courts have recently held that only the Drug Enforcement Agency (“DEA”) can make such a change.

Most recently, on February 26, 2018, U.S. District Judge Alvin Hellerstein in Manhattan ruled dismissed a lawsuit seeking to overturn the United States’ prohibition of marijuana on the grounds that the ban was unconstitutional. Judge Hellerstein ruled that the lawsuit must be dismissed because the plaintiffs had failed to use administrative procedures within the DEA to challenge the ban. Judge Hellerstein said his decision “should not be understood as a factual finding that marijuana lacks any medical use in the United States,” but, rather, that the authority to make that decision lies with the DEA, not with the court.

As of now the Marijuana Justice Act has not seen much movement in Congress. Since its introduction it has been read twice and then referred to the Committee on the Judiciary. It will be interesting to see if additional senators act to support the Marijuana Justice Act as the debate over the decriminalization of marijuana continues.

As discussed in our January 5th blog post, the Cole Memorandum was rescinded by Attorney General Jeff Sessions on January 4th of this year.   The Cole Memorandum had served to formally announce the DOJ’s policy that it would not interfere with medicinal marijuana legalized under state law, despite marijuana’s continued illegality for all purposes under federal law. With the rescission of the Cole Memorandum, federal prosecutors are now free to determine to what extent they will enforce federal law against the state-legalized medical marijuana industry.

However, the effect of the change in policy reaches further than to just the cultivators, manufacturers and distributors of medicinal marijuana products. Pursuant to the Controlled Substances Act, not only is it illegal to manufacture, distribute or dispense marijuana for any purpose – but it is also illegal to aid someone in doing so. Therefore, the DOJ is now free to prosecute anyone “aiding” in a medical marijuana business, for example, giving legal advice.

Probably of greater practical concern to attorneys than criminal prosecution is the tremendous amount of uncertainty as to how the change in policy will impact the ethics surrounding the representation of medical marijuana clients. Most, if not all, states have ethical rules that specifically prohibit a lawyer from assisting a client in illegal conduct. These rules do not distinguish between conduct that is illegal under federal law but expressly permitted under state law.

New York Rule of Professional Conduct 1.2 provides that “[a] lawyer shall not counsel a client to engage, or assist a client, in conduct that the lawyer knows is illegal or fraudulent, except that the lawyer may discuss the legal consequences of any proposed course of conduct with a client.” While it is generally undisputed that an attorney may advise a client about what state law provides – for example, filing requirements – an attorney arguably would be violating the Rules of Professional Conduct by, for example, assisting a client in negotiating a marijuana distribution contract.

Ethics boards in some states, including New York, have used the Cole Memorandum as the decisive factor to conclude that providing legal advice related to legalized medical marijuana businesses does not violate ethics rules. To a lesser extent, some states, including New York, have also relied on the theory that state ethics rules are intended to promote state policy – and by approval of the state medicinal marijuana law, a state has expressed its state policy on the matter, yielding no ethical violation.

It remains to be seen what impact the rescission of the Cole Memorandum will have on the ethics opinions of various states that are based heavily upon the prior policy of federal non-enforcement. For now, we can still find comfort in the Rohrabacher-Blumenauer amendment to the federal budget, which currently continues in effect until February 8 and maintains that federal funds (including those allocated to the DOJ) cannot be used to prevent states from “implementing their own state laws that authorize the use, distribution, possession or cultivation of medical marijuana.”

Despite numerous states having legalized medical marijuana, and a handful of others having legalized marijuana for recreational use, it still remains impossible to obtain a U.S. federal trademark registration for marijuana products or related goods or services.

The U.S. Patent and Trademark Office (USPTO) is the federal agency charged with granting U.S. patents and registering trademarks. The USPTO registers trademarks based on the commerce clause of the Constitution (Article I, Section 8, Clause 3) and registration is governed under various rules of practice and federal statutes.

The USPTO Trademark Manual of Examining Procedure (TMEP) Section 907 explains that under Trademark Rule of Practice 2.69, “[u]se of a mark in commerce must be lawful use to be the basis for federal registration of the mark. . . . Generally, the USPTO presumes that an applicant’s use of the mark in commerce is lawful and does not inquire whether such use is lawful unless the record or other evidence shows a clear violation of law, such as the sale or transportation of a controlled substance.”

As we’ve discussed in previous blog posts, marijuana, whether used for medicinal or recreational purposes, is classified as a Schedule 1 drug under the Controlled Substances Act (CSA). The CSA prohibits the manufacturing, distributing, dispensing or possession of certain controlled substances, including marijuana and marijuana-based products and services. In addition, the CSA makes it unlawful to sell, offer for sale or use any facility of interstate commerce to transport illegal substances, including marijuana.

As a result of the CSA, U.S. trademark applications related to marijuana or marijuana related goods and services will be refused registration under TMEP Section 907. TMEP Section 907 further provides that “[r]egardless of state law, the federal law provides no exception to the above-referenced provisions for marijuana for ‘medical use.’” Recent decisions issued by the USPTO continue to deny the federal registration of trademarks relating to marijuana and related goods and services despite the legality of such products and services under state law.

Trademarks that reference marijuana but that are used in commerce on lawful products, such as clothing, may be registered with the USPTO. For example, the trademark “MARIJUANAMAN” was registered by the USPTO as the mark will be used in connection with books about cannabis. Similarly, the trademark THE MARIJUANA COMPANY was approved in connection with the mark’s use on clothing.

Since federal registration is not permitted for trademarks that cover the sale or transportation of marijuana, such trademark applicants must rely on state trademark filings for the registration of their trademarks. This has become an important issue since so many states have now enacted legislation legalizing the medical – and in some cases, recreational – use of marijuana.

State trademark registrations are more limited in scope than federal trademark registrations as they don’t offer national protection or afford a registrant a presumption of ownership and validity of the underlying trademark on a national level. They are relatively inexpensive to obtain, however, and can afford the registrant at least certain benefits under state law. States like Washington, Oregon, Nevada and Colorado already allow for the registration of cannabis-related marks.

Nevada, for example, enacted legislation governing the use of names, logos, signs and advertisements by medical marijuana establishments. Pursuant to NAC 453A.402, any such names, logos, signs and advertisements must be approved by the Administrator of the Division of Public and Behavioral Health. In addition, Nevada has established guidelines which provide design guidelines for medical marijuana establishments. The guidelines specify, among other things, that the overall appearance of the mark or advertisement must not be appealing to minors; not contain cartoon-like figures or illustrations; not contain humor and must avoid script, decorative or gimmicky fonts. The use of of marijuana slang in the mark or advertisement, such as pot or weed, is also strictly prohibited.

Most recently, as of January 1st, 2018, customers may also register cannabis-related marks with the California Secretary of State. In order to register the mark California requires that (1) the mark be lawfully in use in commerce within California; and (2) the mark match the classification of goods and services adopted by the USPTO. To be lawfully using the mark in commerce within California requires that the registrant be licensed by California to provide the goods and services for which he or she is seeking protection and that such goods and services have already been sold to the public. Unlike registration of a trademark at a federal level, California does not have an intent-to-use trademark application. As such, the mark must be in use prior to registering the mark with the Secretary of State.

New York has not yet enacted any special legislation or guidelines relating to the registration of marijuana-related trademarks with the New York Secretary of State. That may soon change, however, as more and more states start to allow state registration of marks relating to marijuana and marijuana-related goods and services.