Trends to Come
Ensuring medical directorship agreements are accountable
The U.S. Department of Health and Human Services Office of Inspector General (OIG) focus on false claims, Stark Law, and kickback issues with medical director agreements continues to increase. In 2009 alone, the Justice Department made numerous fines and settlements surrounding medical director arrangements. To demonstrate the importance of compliance surrounding these financial arrangements, we have listed a few cases. including the penalties faced by hospitals.
This article, published in Compliance Today, appears here with permission from the Health Care Compliance Association. Call HCCA at 888/580-8373 with all reprint requests.
Reflecting on a Recent Settlement of Employed Physicians Compensation
Covenant Medical Center in Waterloo, Iowa a 231-bed hospital recently agreed to pay the U.S. government $4.5 million1 to settle allegations that its compensation to five specialists violated the Stark restrictions on physician self-referral, and therefore also violated the False Claims Act with the related Medicare claims. The government alleged that the physicians’ compensation exceeded fair market value (FMV) and was not commercially reasonable.
Minimizing risk in financial arrangements with hospital-based specialties
Hospital-based specialties, such as anesthesia, radiology and hospitalist medicine, frequently require financial assistance from the hospital to keep the group financially secure and maintain continuous coverage. Typically, financial assistance is structured in the form of (1) a collection guarantee or (2) a fixed subsidy. A collection guarantee is a fluctuating payment equal to the shortfall of the group’s actual collections minus reasonable operating expenses. A fixed subsidy (i.e., usually not subject to repayment) is based on historical or estimated collections minus reasonable operating expenses.
This article, published in the February 2010 issue of Compliance Today appears here with permission from the Health Care Compliance Association. Call 888/580-8373 with all reprint requests.