Welcome to the final installment in MD Ranger’s blog series on risk management! We hope that this series has been an interesting and informative resource for you and your organization. We’ve spent a lot of time talking about the potential consequences of Stark, Anti-Kickback, and False Claims Act violations.
Compliance matters. A dynamic compliance program can both minimize risk and allow for innovation. Involving compliance officers in the early stages of major decisions reduces risk and saves time. Top healthcare organizations have begun to include compliance officers in their C-Suite.
No one wants to be blindsided by compliance violations. Under the False Claims Act, the government could be auditing your organization without your knowledge. The biggest threat to a healthcare organization is ignorance. Think about your organization’s compliance program. Are the administrators and compliance officers in charge of your physician contracts aware of the penalties for these violations?
Ask yourself the following questions:
1. Does your organization have contracts for all paid services and positions?
It is essential that you document all financial arrangements with physicians. Work with your administrators and C-Suite to ensure that all contracted positions have signed agreements including payment rate, defined services, and time requirements. Paying a physician for service without a contract in place is illegal.
2. Do you track or automate your contract expiration dates?
The law requires that physician contracts be set in advance. Identify all expired contracts and prioritize them for renewal. If your organization doesn’t have a contract management system, consider either building or purchasing one.
3. Do you know how many physician contracts your organization currently has?
MD Ranger has found that community hospitals have an average of 50-60 physician contracts. Larger organizations and health systems have numbers skyrocketing into the thousands. Understanding the scope of market positions of your contracts and payment rates will help you identify high-risk contracts before they become a problem.
4. Do you know which of your contracts are high-risk?
Contract review is not rocket science. Annual review of your contracts against published benchmarks is a simple way to identify potential areas of concern. If your organization has risky or high-profile contracts, they may require extra documentation. Familiarize yourself with payment rate benchmarks and how they apply to your facility or system.
5. Does your organization have a system for handling exceptions to market data?
When your organization compensates a physician above or below fair market value, do you have a process for documenting exceptions? There are no explicit prohibitions to paying physicians above a certain threshold, but you need to justify your actions.
Welcome back to MD Ranger’s blog series on risk management! We hope that these articles will help both you and your organization understand the ever-increasing need for strict, internal compliance procedures. So far, we’ve touched upon individual accountability in corporate wrongdoing and the laws used to hold individuals accountable for their actions. This week’s installment is dedicated to qui tam lawsuits, and practical ways to avoid them.
I may sound like a broken record, but the False Claims Act (FCA) violations are serious business. Submitting false claims to the federal government–regardless of your intentions–is a surefire way to land yourself in hot water. Part of what makes the FCA such an effective tool is its qui tam provision.
According to whistleblower defense firm Phillips & Cohen, the qui tam lawsuit as a way for whistleblowers to help the government stop fraud. Under the FCA, any individual has the right to sue an entity they believe to have committed fraud against the government–and to recover funds on their behalf.
Whistleblowing can be an incredibly lucrative endeavor. More often than not, the government will rely on the efforts of individual plaintiffs. Why is this such an effective method? What does an individual have to gain by blowing the whistle on his organization? Money. And lots of it. A whistleblower could pocket up to 30% of the recoveries from a qui tam lawsuit. Recoveries from these suits can amount to hundreds of millions of dollars.
Whistleblowers are protected from employer retaliation by law firms dedicated to their protection. In addition, the FCA provides that whistleblowers are entitled to complete restitution in the event of their harassment. Qui tam suits are filed under seal and kept secret even from the accused party. Unless the government asks for the seal to be lifted, the accused could remain in the dark until served their papers.
Contrary to popular belief, whistleblowers are frequently high-performing individuals who report high levels of job satisfaction. They raise issues believing that their organization will respond positively to their criticisms. If the individual feels that their complaint is being ignored or improperly addressed, they resort to whistleblowing.
How should your organization approach these complaints? Here are a few best practices:
- Take the individual seriously. Listen to their complaints, and investigate promptly.
- Document everything. Keep track of all relevant interactions, and keep the individual in the loop.
- Explain. When you conclude your investigation, sit down with the individual to review your findings and explain your reasoning.
Telemedicine is on the forefront of the healthcare revolution.
According to a recent report, the telemedicine market within the United States will be around $65 Billion by 2025. While telemedicine has existed for several decades, it has been becoming more mainstream with mass market adoption and more insurance providers covering the costs of virtual visits. Patients now can see doctors virtually for anything from hair loss treatments to flu medication. Hospitals are increasingly turning to telemedicine for emergency coverage as well, particularly for psychiatry, neurology and e-ICU services.
While some telemedicine companies directly employ physicians, many contract with medical groups or networks to provide professional services to individuals and companies over the internet. University and tertiary medical centers are using telemedicine to provide specialty consultations to outlying areas while health systems are using telemedicine to connect rural and community hospitals with urban specialists. Arrangements include for-profit companies like Teladoc who are building direct-to-consumer access to medical groups and integrated delivery systems like Dignity Health's Telemedicine Network that provide both direct-to-consumer access as well as hospital-contracted telemedicine support for stroke, ICU, psychiatry, and chronic disease management.
In 2019, MD Ranger published our first telemedicine benchmarks that provide market rate benchmarks for physician per-episode payments and monthly telemedicine hospital contracts. We have found two common payment methods for hospital-based telemedicine services: all-inclusive monthly fees that include both technology and professional services and monthly-plus per episode contracts that have a fixed monthly payment plus a per-episode payment when the physician is accessed. MD Ranger benchmarks include critical care/eICU, psychiatry, and neurology. According to our benchmarks, the mean per-episode payment for all telemedicine services is $190 while the mean monthly payment is $12,490.
With this rapidly growing market segment, the MD Ranger benchmarks can provide guidance on appropriate payment rates to telemedicine providers. This is an example of how MD Ranger’s comprehensive benchmark development process provides health care providers with tools to stay compliant with ever-expanding new frontiers in physician contracting. MD Ranger’s benchmarks, including for telemedicine, can play a role in your broader physician contracting strategy.
Welcome back to MD Ranger’s blog series on risk management! We hope that these articles will help both you and your organization understand the ever-increasing need for strict, internal compliance procedures. Last week, we talked about the changes made by the Department of Justice (DOJ) to policy regarding individual accountability in corporate wrongdoing. This week, we dive headfirst into a discussion about the mediums through which both individuals and organizations can be held accountable for white-collar crime.
Being ‘held accountable’ is a nice way to say that you have been caught defrauding the government. The DOJ’s primary defense mechanism against fraudulent behavior are the Stark Law, the federal Anti-Kickback Statute (AKS), and the federal False Claims Act (FCA).
According to health law firm Barrett & Singal, the FCA imposes liability on individuals and facilities who submit false or fraudulent claims to the government for payment. Less obvious fraudulent behaviors often implicate healthcare organizations under nuanced aspects of this law. A majority of FCA come in response to claims for fraudulent Medicare reimbursements. The FCA has a qui tam provision, meaning that any individual possessing knowledge of a false claim can file suit against an entity on behalf of the federal government. If the suit is successful, the whistleblower is awarded a percentage of the penalties. We’ll talk more about this in the next installment.
To the left of the FCA rests the Stark Law. Stark Law is a civil law restricts physician self-referrals. Anyone who could have a financial stake in a physician’s practice cannot refer patients to to that physician. Stark Law is a strict liability statute, meaning that the government doesn’t have to prove that you intended to break the law. A Stark Law violation does not merit jail time, but offenders often incur devastating penalties. If the law was proven to be intentionally violated, a healthcare provider could be charged up to three times the original penalties–hundreds of illegal arrangements could mean hundreds of millions of dollars worth of fines.
Opposite Stark Law is AKS. The AKS prohibits both the offer and exchange of anything of value in order to entice or reward referral of healthcare services. AKS is a criminal statute–in addition to severe penalties, offenders could face a prison term of up to ten years per violation. The law is clear: it is illegal to solicit or reward referrals for any sort of compensation.