Strategic Management works with health care providers and attorneys nationwide in reviewing and analyzing relationships with physicians. In the ever challenging regulatory and enforcement environment, we provide review and advisory services to health care providers on their existing arrangements with physicians and identify potential risk areas. Often under the direction of counsel, we review physician/provider arrangements to determine their appropriateness under the Federal Anti-Kickback Statute, Stark Law, and other legal authorities.
If you have questions and would like to speak with a physician arrangement specialist, please contact us at (703) 683-9600 or fill out our online contact form.
In recent years, the HHS Office of Inspector General (OIG) and Department of Justice have initiated scores of investigations and prosecutions targeting improper physician/provider arrangements. Often, providers are subject to legal actions claiming that all claims for payment by a Federal health care program that arise from a potentially illegal physician/provider arrangement are false and fraudulent. Many Corporate Integrity Agreements (CIAs) are based upon violations related to these types of arrangements. With increasing Federal scrutiny of physician/provider arrangements, providers are seeking assurances that they are operating in conformance with all applicable legal provisions.
The HHS OIG and CMS recognize the practices and needs of hospitals to enter into compensation arrangements with physicians in order to secure medical director and physician clinical/administrative services. However, when aggregate physician compensation exceeds Fair Market Value (FMV) and is not “commercially reasonable,” then any excess benefit(s) to a physician or other potential referral source may be in violation of the Anti-Kickback Statute and/or Stark Law. Health care providers should be vigilant in ensuring that any compensation or “remuneration” to a physician is consistent with the principles underlying FMV and commercial reasonableness, as well as the value and time associated with services being furnished by physicians.
Hospitals and other health care organizations are increasingly seeking to proactively review existing physician compensation practices, and develop policies and procedures applicable to establishing new relationships and conducting internal reviews of existing arrangements. These internal reviews give a hospital the necessary information to identify and remedy any problematic areas, and consider whether self disclosure to the Federal Government is warranted.
Strategic Management is often retained to evaluate proposed and existing physician/provider arrangements to assess compliance with legal standards and requirements, identify weaknesses, and assist in undertaking remedial measures. We review both proposed and existing arrangements to determine whether they align with FMV and commercial reasonableness standards, and have sufficient safeguards and documentation to demonstrate compliance with all Governmental requirements.
In order to align with existing statutory requirements, as well as “safe harbor” and other regulatory exceptions, physician/provider arrangements should be scrutinized for issues such as the following:
The experience and qualifications of Strategic Management’s consultants enable us to provide valuable assistance as to how Federal enforcement and regulatory agencies will view specific facts and circumstances relating to provider/physician relationships. Led by our CEO, Richard Kusserow, who was the Inspector General for US Department of Health and Human Services for eleven years, we have assembled a team of experienced consultants who are able to address the full range of provider/physician issues. It was under former Inspector General Kusserow that the first report was issued to Congress highlighting the issues associated with Financial Arrangements Between Physicians and Health Care Businesses. Shortly thereafter, another OIG report was issued on Financial Arrangements Between Hospitals and Hospital-Based Physicians. During Mr. Kusserow’s tenure as Inspector General, the first “safe harbor” regulations were issued to provide guidance on practices that could be insulated from exposure under the Anti-Kickback Statute.
Tom Herrmann, JD, joined Strategic Management after serving as an Administrative Appeals Judge on the Medicare Appeals Council for six years. Prior to his service on the Council, he was with the Office of Counsel to the HHS OIG for twenty years and dealt with physician/provider issues on a regular basis. They are complemented by a number of other former OIG and Department of Justice personnel who have extensive experience, both while serving in government and subsequently working as consultants in assisting health care providers to address issues associated with their arrangements with physicians.
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