11/30/2012. Systems for Assuring Compliance with AKS and Stark
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- Joanna Sullivan
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1 Systems for Assuring Compliance with AKS and Stark WHY? Condell Medical Center (IL), $36 million Physician arrangements Leases of medical office space at rates below fair market value Improper loans to physicians Hospital reimbursement to doctors who performed patient services without required written agreements Self-reported 2 WHY? The Christ Hospital (OH), May $108 Million Whistleblower and DOJ alleged that cardiologists were allotted time in a Christ Hospital outpatient testing unit known as the Heart Station (and the ability to bill for services provided there) based solely on the number of CABG procedures or cath-lab revenues they or their group generated for the Christ Hospital during the prior year. 3 1
2 WHY? United Shockwave Services (7/8/2010) Physician owned provider of lithotripsy and laser surgery and equipment to hospitals $7.3 Million CMP Settlement with OIG 5 year corporate integrity agreement This settlement sends a strong message that companies, including those with physician-owners, cannot use Federal health care beneficiary referrals to line their pockets by securing business from hospitals or other providers, 4 Why? Bristol Hospital ( BH ) & Bristol Gastroenterology Associates ( BGA ) (February 1, 2012) BGH use of hospital space without a lease (2 years) and without paying rent (18 months) DOJ announces joint settlement with BH and BGA for $157,830 5 Why? 3/9/2012 Iowa group practice settles with CMS: employment of physician not consistent with employment exception - $74,000 settlement. 6 2
3 STARK - Plain Language If a Physician (or immediate family member) has a direct or indirect Financial Relationship with an Entity, unless an exception applies: the Physician may not Refer any Designated Health Services ( DHS ) to the Entity, the Entity may not bill for any DHS referred by the physician, no Medicare payments may be made for DHS referred by the physician, and the Entity must refund all moneys collected for DHS referred by the physician (unless no actual knowledge or reckless disregard re: the physician s identity) 7 Definitions Designated Health Services 1. Clinical Laboratory Services 2. Physical Therapy, Occupational Therapy and Speech-Language Pathology Services 3. Radiology and certain other imaging services 4. Radiation Therapy services and supplies 5. Durable medical equipment and supplies 6. Parenteral and enteral nutrients, equipment, and supplies 7. Prosthetics, orthotics, and prosthetic devices and supplies 8. Home health services 9. Outpatient prescription drugs 10. Inpatient and outpatient hospital services 8 Hometown Lease Agreements Hometown Hospital is a critical access facility in a small rural community. The hospital owns a small medical office building with four medical office suites. The suites are leased to private practice physicians in the community. The hospital s compliance officer recently reviewed the leases and determine that two of the leases are expired. In her review the compliance officer also discovers that rent increases called for by the leases have not been applied since the inception of the leases. 9 3
4 City Partners in Radiology, LLP City Partners in Radiology, LLP ( CPR ) is a progressive medical group practice made up primarily of radiologists. In recent years, however, CPR has added several primary care physicians and has branched out by offering partnerships to interventional radiologists and, recently, to a cardiac surgeon. CPR prefers as much as possible to utilize its own radiology equipment to treat patients CPR operates several IDTFs. It also has contractual arrangements with several local hospitals to provide both technical and professional components of radiology service for hospital patients. 10 Medical Director Dr. Smith Dr. Smith, an internal medicine physician, is a well regarded by the community and by his patients. He has served for the last three years as Medical Director at Sisters of Mercy Home Health. Dr. Smith was not paid for his medical director role he has no contract, has served on a volunteer basis and made significant contributions to the operation of several programs at the home health agency during his tenure. The agency being very grateful for Dr. Smith s contributions sends Smith and his wife on a two week tour of Australia. The cost of the tour was $5, Dr. Welby Dr. Welby is a well known cardiologist in Metropolia. In addition to operating a very busy private practice, Dr. Welby has medical director agreements with three large metropolitan hospitals. He is also serves as president of, and receives a significant salary from, a large research institute that is a subsidiary of Community Medical Center ( CMC ) one of the hospitals where he serves as cardiology medical director. CMC s compliance officer is conducting a periodic review of the hospital s financial arrangements with physicians. 12 4
5 Dr. Welby CMC s Compliance officer learns that Dr. Welby s arrangements include: Part time employment as President of the Research Institute his salary as President is $225,000/year (no contract) Research Institute pays Welby $350,000 annually as PI on 15 clinical trial and device studies (no contracts) Welby worked and was paid hourly ($250/hour) for 1,000 medical director hours at the hospital last year. His contract caps his monthly medical director fees at $15, Who Needs to be Concerned? Entities (perform or bill for DHS referrals) Physicians/Physician Organizations 14 What is the role of a compliance program in this arena? 15 5
6 Compliance Mechanisms Baseline arrangement review Policies & procedures Contract database Rent logs/payment approvals Training Periodic monitoring Dealing with trouble 16 Baseline Arrangements Review - Leases How? Rent roles Property logs Watch for Use of space without a lease e.g., Medical director/hospital office for patient care 17 Baseline Arrangements Review Leases (what is covered?) Current lease agreement? Consistent with Stark exception? Term of 1 year, signed by parties, specifies premises, FMV, etc. Accurately reflects space (sq. ft.?, site visit) Rental payments current and correct? Rent increase applied? Timeshare requirements met? 18 6
7 Some issues Rent late late fees not applied; rent escalation not applied No FMV opinion in record Recent FMV opinion show significant increase/decrease in FMV rates Lease not signed/late signed by one or both parties Space used not consistent with written agreement Uncollected/late rent Expired lease Physician tenant unwilling to negotiate new - renewal lease agreement 19 Baseline Arrangements Review - Services How? AP logs Watch for payments to organizations owned by physicians Be sure to identify all AP operations Interviews Part-time employees 20 Baseline Arrangements Review Administrative/Clinical Services Employment Personal Service Exception Current writing/contract? Consistent with exception? Term of 1 year, signed by parties, specifies services, FMV, cross referenced or searchable contract d-base? Payments consistent with contract? Documentation 21 7
8 Some Issues No formal contract Unsigned/late signed agreement Contract minimum/maximum hours not met Missing/inadequate documentation Payment inconsistent with contract rate; exceed contract maximum Expired contract Commercially reasonable? 22 Policies Administrative Service Medical Director, Medical Staff Leader, teaching, honorarium, board service Professional Services Clinical services, call coverage, other? Rental of Office Space Rental of Equipment Watch for under-arrangements Non-Monetary Compensation Medical Staff Incidental Benefits Recruitment Professional Courtesy Joint Ventures 23 Important Policy Considerations Legal review of arrangements Timely signature FMV process, safe zones Commercial reasonableness Physician documentation Contract database requirements No contract/no pay 24 8
9 NMC Limits and Tracking Approvals and tracking Excess NMC Is it really NMC? Curing Periodic monitoring how to approach 25 Rent Logs/Payment Approvals How does a commercial landlord assure rents are timely collected Invoicing/late charges Collection practices Payment Request Approvals Current contract? Documentation adequate? Administrative time; clinical; call coverage Payment consistent with contract? 26 What Causes Problems? Example: Cardiologists at UMDNJ The UMDNJ contracts with the community cardiologists required them to work part-time at University Hospital as Clinical Assistant Professors, and to perform bona fide services, such as teaching at UMDNJ s medical school, providing on-call coverage, attending weekly conferences, lecturing, and supporting UMDNJ s research efforts... US Department of Justice, D. New Jersey, Press Release dated May 7,
10 Cardiologists at UMDNJ Excerpts from the Federal Monitor Report Dated November 13, none of the doctors provided sufficient academic services warranting the salaries that they received. (Report at 4)... the doctors provided little-to-no service to UMDNJ for their respective salaries (Report at 9) the listed services [the physicians were supposed to render] were, with only a few exceptions, all the same. (Report at 14) 28 Cardiologists at UMDNJ Dr. Desai was unable to answer questions regarding approximate hours spent teaching or providing services in connection with his compensation from UMDNJ. (Report at 15) Had UMDNJ paid these doctors fair market value for bona fide services, including teaching and research, UMDNJ would not have run afoul of the law. (Report at 4) 29 Cardiologists at UMDNJ Settlements Ravindra Patel, MD - $300,000 (2x salary received) Jasjit Walia, MD - $300,000 (2x salary received) Rakesh Sahni, MD - $360,000 (2x salary received) Trevor Atherley, MD - $180,000 (return of full salary) Abdul Ameen, MD - $38,000 Michael Benz, MD - $30,
11 Cardiologists at UMDNJ Settlements & Pleas Joven Dungo, MD - $138,000 (2x salary received) Bakul Desai, MD Plead guilty: criminal embezzlement $1.4 Million (2½ x salary received) Lamipathi Garipalli, MD Plead guilty: criminal embezzlement - $560,000 (2x salary received) Joseph Campbell, MD found not guilty by a jury after three year investigation and trial UMDNJ - $8.3 Million 31 Contract Database Required (as a practical matter) element of personal service exception Can help to manage contract expiration/renewal process Can be repository for contract and other essential related documents (FMV, correspondence, space plans, physician time sheets) 32 Training Who? Personnel involved in arrangements Physicians? What? Legal requirements Policies/procedures/responsibilities How? 33 11
12 Monitoring Lease Compliance Questions 1. Is there a written lease? 2. Is the lease agreement current (i.e., not expired)? 3. Was the lease signed by all parties before the space was occupied? 4. Is the tenant using the space as stated in the lease? 5. Have CPI or flat rate increases been applied as scheduled? 6. Are payments at the correct rate for the last three months? 7. If the tenant was late in paying rent, was there a late charge? 8. Is tenant current on the rent? 9. Was the agreement loaded into Tract Manager? 10. Is there evidence that Legal Services approved the contract? 11. Is the FMV scanned into Tract Manager? 34 Monitoring Personal Services 1. Is there a written contract or agreement? 2. Is the agreement current (i.e., not expired)? 3. Was the contract signed by all parties before services or payment were provided? 4. Is the physician s time or services documented as required by the contract? 5. Is timesheet documentation adequate? 6. Is the payment consistent with the contract? 7. Was the agreement loaded into TractManager? 8. Is there evidence that Legal Services approved the contract? 9. Is documentation of FMV analysis loaded into TractManager? 10. Was the check request properly approved before payment? 11. Are physician s timesheets/invoices scanned into TractManager? 35 What to do with Problems Job One: stop the bleed Bill hold; fix the problems Resolving Liability Link to PPACA report & repay requirement Repay referrals Self-disclosure Stark only CMS (only) AKS implications OIG (only) DOJ 36 12
13 Questions /Discussion 13
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