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Primary Care Providers Win Challenge of CMS Interpretation of Enhanced Payment Law

With the help and support of the Tennessee Medical Association, 21 Tennessee physicians of underserved communities joined together and retained Bass, Berry & Sims to file suit against the Centers for Medicare & Medicaid Services to stop improper collection efforts. Our team, led by David King, was successful in halting efforts to recoup TennCare payments that were used legitimately to expand services in communities that needed them. Read more

Tennessee Medical Association & Bass, Berry & Sims

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Download the Healthcare Fraud & Abuse Review 2017, authored by Bass, Berry & Sims

The Healthcare Fraud & Abuse Review 2017 details all healthcare-related False Claims Act settlements from last year, organized by particular sectors of the healthcare industry. In addition to reviewing all healthcare fraud-related settlements, the Review includes updates on enforcement-related litigation involving the Stark Law and Anti-Kickback Statute, and looks at the continued implications from the government's focus on enforcement efforts involving individual actors in connection with civil and criminal healthcare fraud investigations.

Click here to download the Review.

SEC Adopts Regulation A+: New Avenue to Capital for Small Businesses and Start-ups


April 9, 2015

On March 25, 2015, the SEC adopted final rules to update and expand Regulation A, an existing exemption from registration for smaller issuers of securities. The updated exemption, often referred to as Regulation A+, will permit smaller companies to offer and sell up to $50 million of securities in a 12-month period, subject to eligibility, disclosure and reporting requirements.

The adopted rules will become effective 60 days after publication in the Federal Register. To review the SEC's adopting release, click here.


Existing Regulation A has provided a rarely used exemption from the registration requirements of the Securities Act of 1933 for securities offerings by small private U.S. and Canadian companies. It essentially allows small private companies to offer freely tradable securities while going through a mini-registration process. Two major drawbacks of the existing Regulation A were that it required companies to register their offerings in every state where securities would be offered and that it limited those offerings to $5 million. The state registration requirements were costly and burdensome and the offerings raised too little capital. The new amendments were adopted to implement Section 401 of the JOBS Act, which was intended to improve access to capital for small businesses.

Final Rule

The final rules implement the mandated rulemaking under the JOBS Act by providing two tiers of offerings: (i) Tier 1, which would consist of securities offerings of up to $20 million in a 12-month period, and (ii) Tier 2, which would consist of securities offerings of up to $50 million in a 12-month period. For offerings of up to $20 million, the issuer could elect whether to proceed under Tier 1 or Tier 2. Both tiers would be subject to basic requirements as to issuer eligibility, disclosure and other matters, drawn from the current provisions of Regulation A. Both tiers would also permit companies to submit draft offering statements on a confidential basis to the SEC before filing, permit the continued use of solicitation materials after filing the offering statement, require the electronic filing of offering materials and otherwise align Regulation A with current practice for registered offerings.

The Regulation A+ exemption would be limited to companies organized in and with their principal place of business in the U.S. or Canada. In general, the following companies would be ineligible to use Regulation A+:

  • An issuer that is already an SEC-reporting company;
  • An investment company registered or required to be registered under the Investment Company Act of 1940 or a business development company as defined in section 2(a)(48) of the Investment Company Act of 1940;
  • Development stage companies that have no specific business plan or purpose or have indicated their business plan is to engage in a merger or acquisition with an unidentified company; and
  • An issuer that is disqualified under the SEC's "bad actor" disqualification rules.


The adoption of Regulation A+ is another key step in the SEC's ongoing efforts to facilitate capital formation. While Tier 1 offerings will be subject to both SEC and state review (a significant expense that has generally turned issuers away from Regulation A in the past), Tier 2 offerings will provide for the preemption of state securities law registration, which has the potential to work effectively for capital raises of up to $50 million. In addition, Tier 2 offerings will provide a conditional exemption from Section 12(g) of the Securities Exchange Act of 1934, so that Tier 2 issuers have some breathing room to raise capital and grow without triggering the burden of full SEC reporting requirements.

A summary chart comparing the key provisions of Tier 1 offerings and Tier 2 offerings is presented below.

  Tier 1 Tier 2

Annual Offering Limit $20 million, including no more than $6 million on behalf of selling securityholders that are affiliates of the issuer. $50 million, including no more than $15 million on behalf of selling securityholders that are affiliates of the issuer.
Application of State Securities Laws; No exemption provided. Preemption of state securities law registration and qualification requirements for securities offered or sold to "qualified purchasers," which is defined to be any person to whom securities are offered or sold in a Tier 2 offering, or where securities are listed on a national securities exchange.
Limitations on Investors No limit. Investment limit applicable to persons who are not accredited investors.
SEC Filing Requirements
  • Issuers must file with the SEC a Form 1-A (named, the "Offering Circular"), which is reviewed and qualified with the SEC.
  • Confidential SEC review of the Offering Circular is permitted, so long as the Offering Circular is publicly filed not later than 21 calendar days before qualification.
  • Permit continuous or delayed offerings.
Same as Tier 1.
Solicitation Materials Issuers may "test the waters" with the general public either before or after the filing of the Offering Circular. Same as Tier 1.
Financial Statement Requirement
  • Periods:
    • Balance sheets and related financial statements for the two previous fiscal year ends (or for such shorter time that they have been in existence).
    • Financial statements must be dated not more than nine months before the date of non-public submission, filing or qualification, with the most recent annual or interim balance sheet not older than nine months. If interim financial statements are required, they must cover a period of at least six months.
  • Unaudited. The financial statements prepared for Tier 1 offerings need not be audited. However, if an audit was obtained for other purposes and that audit was performed in accordance with U.S. generally accepted auditing standards or the standards of the Public Company Accounting Oversight Board (PCAOB) by an independent auditor, those audited financial statements must be filed. The auditor does not need to be registered with the PCAOB.
  • Periods:
    • Same as Tier 1.
  • Audited. The financial statements prepared for Tier 2 offerings must be audited in accordance with either U.S. generally accepted auditing standards or the standards of the PCAOB by an independent auditor. The auditor does not need to be registered with the PCAOB. Interim financial statements may be unaudited.
Ongoing Reporting Exit Reporting. File on EDGAR an exit report not later than 30 calendar days after termination or completion of an offering. Annual, Semiannual and Current Reporting. File on EDGAR annual and semiannual reports, as well as current event reports.

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