Florida Health Care Law Group

Florida Health Care Law Group Florida Health Care Law Group in committed to providing quality legal representation in all aspects

Florida Health Care Law Group is a boutique law firm committed to providing quality legal representation in all aspects of healthcare law in a cost effective manner. Our Law Firm provides its clients with superior multidisciplinary capabilities specific to the healthcare industry. Our lawyers’ previous representation of insurance carriers provides priceless knowledge and insight pertaining to proc

edures, policy coverage, claims processing and litigation by the insurance industry. Our Firm’s commitment is to zealously advocate for our client.

08/28/2014
oig.hhs.gov

Special Fraud Alert: Physician-Owned Entities
By: Okan Gunay, Esq., Associate at Florida Healthcare Law Group

The Office of the Inspector General (OIG) has recently issued a Special Fraud Alert addressing physician-owned entities that derive revenue from selling, or arranging for the sale of, implantable medical devices ordered by their physician-owners for use in procedures the physician-owners perform on their own patients. These entities frequently are referred to as physician-owned distributorships, or “POD’s.” The link to the Alert is the following: http://oig.hhs.gov/fraud/docs/alertsandbulletins/2013/POD_Special_Fraud_Alert.pdf


The OIG has noted that there is a strong potential for improper inducements between and among the physician investors, the entities, device vendors, and device purchasers and stated that such ventures “should be closely scrutinized under the fraud and abuse laws.” Moreover, hospitals and ambulatory surgical centers (ASC’s) that enter into arrangements with POD’s also may be at risk under the anti-kickback statute.

The Anti-Kickback Statute
One purpose of the anti-kickback statute is to protect patients from inappropriate medical referrals or recommendations by health care professionals who may be unduly influenced by financial incentives.

The federal Anti-Kickback Statute is a criminal statute that prohibits the exchange (or offer to exchange), of anything of value, in an effort to induce (or reward) the referral of federal health care program business (such as Medicare or Medicaid). See 42 U.S.C. § 1320a-7b.

When remuneration is paid purposefully to induce or reward referrals of items or services payable by a Federal health care program, the anti-kickback statute is violated. Conviction for a single violation under the Anti-Kickback Statute may result in a fine of up to $25,000 and imprisonment for up to five (5) years. See 42 U.S.C. § 1320a-7b(b). In addition, conviction results in mandatory exclusion from participation in federal health care programs. 42 U.S.C. § 1320a-7(a).

Even absent a conviction, individuals who violate the Anti-Kickback Statute may still face exclusion from federal health care programs at the discretion of the Secretary of Health and Human Services. 42 U.S.C. § 1320a-7(b). The government may also assess civil money penalties, which could result in treble damages plus $50,000 for each violation of the Anti-Kickback Statute. 42 U.S.C § 1320a-7a(a)(7).

Physician-Owned Distributorships
The OIG has repeatedly expressed concerns about arrangements that exhibit questionable features with regard to the selection and retention of investors, the solicitation of capital contributions, and the distribution of profits. The Centers for Medicare and Medicaid Services (CMS) has also stated that POD’s “serve little purpose other than providing physicians the opportunity to earn economic benefits in exchange for nothing more than ordering medical devices or other products that the physician-investors use on their own patients.” See 73 Fed. Reg. 23527, 23694.

POD’s potentially raise four major concerns typically associated with kickbacks: (i) corruption of medical judgment; (ii) overutilization; (iii) increased costs to the Federal health care programs and beneficiaries; and (iv) unfair competition. Financial incentives POD’s offer to their physician-owners may induce the physicians both to perform more procedures (or more extensive procedures) than are medically necessary and to use the devices the POD’s sell in lieu of other, potentially more clinically appropriate, devices. Disclosure to a patient of the physician’s financial interest in a POD is insufficient to address these concerns.

The OIG recognizes that the lawfulness of any particular POD under the anti-kickback statute depends on the intent of the parties. Such intent may be evidenced by a POD’s characteristics, including the details of its legal structure; its operational safeguards; and the actual conduct of its investors, management entities, suppliers, and customers during the implementation phase and ongoing operations. Nonetheless, PODs are inherently suspect under the anti-kickback statute.

The anti-kickback statute is not a prohibition on the generation of profits; however, PODs that generate disproportionately high rates of return for physician-owners may trigger heightened scrutiny. Because the investment risk associated with PODs is often minimal, a high rate of return increases both the likelihood that one purpose of the arrangement is to enable the physician-owners to profit from their ability to dictate the implantable devices to be purchased for their patients and the potential that the physician-owner’s medical judgment will be distorted by financial incentives. Concerns are magnified in cases when the physician-owners: (1) are few in number, such that the volume or value of a particular physician-owner’s recommendations or referrals closely correlates to that physician-owner’s return on investment, or (2) alter their medical practice after or shortly before investing in the POD (for example, by performing more surgeries, or more extensive surgeries, or by switching to using their PODs’ devices on an exclusive, or nearly exclusive basis).

Finally, because the anti-kickback statute ascribes criminal liability to parties on both sides of an impermissible “kickback” transaction, hospitals and ASC’s that enter into arrangements with POD’s also may be at risk under the statute. In evaluating these arrangements, the OIG will consider whether one purpose underlying a hospital’s or an ASC’s decision to purchase devices from a POD is to maintain or secure referrals from the POD’s physician-owners.


Conclusion

The OIG is concerned about the proliferation of POD’s. Their Special Fraud Alert reiterates their longstanding position that the opportunity for a referring physician to earn a profit, including through an investment in an entity for which he or she generates business, could constitute illegal remuneration under the anti-kickback statute. The OIG views POD’s as inherently suspect under the anti-kickback statute.

http://floridahealthcarelawgroup.com/special-fraud-alert-physician-owned-entities/

08/28/2014

Internet Advertising May Violate Anti Kick Back Laws
By H. Alexis Rosenberg

Marketing on the Internet? We all know that people have started to rely heavily on the internet to locate businesses and to find discounted goods and services. Similarly, businesses have begun to rely on the internet to advertise the goods and services they provide. The practical use of the World Wide Web for marketing and advertising purposes has yet to be fully developed. What we know is that people have begun to rely on various types of websites including Groupon, Yelp, Living Social, Bing, and Google to name just a few, to purchase goods and services including the area of Professional Healthcare. The fee structures for internet marketing are diverse, so healthcare professionals need to be aware of the potential for violating the law when looking to use the internet as a marketing tool. Certain fee structures for marketing on the internet may violate the anti‐kickback and fee splitting laws.

It is important to remember that when marketing on the internet healthcare professionals must still follow all the rules and regulations applicable to their licensure. The sale of goods and services online by the sale of vouchers for discounted services does not by itself violate the law, but when professional healthcare services are involved, there may be exposure for violating the anti‐kickback and fee splitting law when the marketing company receives a percentage of the price of services purchased instead of flat rate. Healthcare professionals need to be cautious when using this type of marketing because they could end up fee splitting with non‐professionals. Healthcare professionals always should be cautious when payments they make are based on a percentage of their fees. Payment by percentage is much different than a flat fee to run any advertisement or a flat rate “per click” as used by many of the search engines.

The potential problem is caused by the fact that the website’s fee for its service is calculated by a portion (percentage) of the amount that is being charged for the service provided. The consumer/patient purchases the coupon/voucher and the payment for the service is being shared or “split” between the professional and the non‐professional (website). Advertising fees that are a percentage of the service provided may violate both the Federal and Florida Anti‐Kickback laws and therefore should be a concern to healthcare professionals. The laws prohibiting professional from splitting fees are clear.

Healthcare professionals are held to a higher standard than the general public and have to be more cautious in how they advertise in order to keep in compliance with all state and federal laws.

http://floridahealthcarelawgroup.com/internet-advertising-may-violate-anti-kick-back-laws/

New blog post!http://floridahealthcarelawgroup.com/medicare-billing-fraud-compliance-plans-are-mandatory/
07/01/2014
Medicare Billing Fraud Compliance Plans Are Mandatory - Florida Healthcare Law Group

New blog post!
http://floridahealthcarelawgroup.com/medicare-billing-fraud-compliance-plans-are-mandatory/

Medicare Billing Fraud Compliance Plans Are Mandatory The Patient Protection and affordable Care Act of 2010 included a requirement for providers of Designated Health Care goods and Services to create and maintain Billing Fraud Compliance Plans. Previously Billing Fraud Compliance Plans were volunta…

06/12/2014

Please remember to nominate Bruce and Alexis Rosenberg for Super Lawyers in Healthcare. Thanks for liking us on Facebook

Address

Sarasota, FL
34239

Alerts

Be the first to know and let us send you an email when Florida Health Care Law Group posts news and promotions. Your email address will not be used for any other purpose, and you can unsubscribe at any time.

Contact The Business

Send a message to Florida Health Care Law Group:

Share

Nearby law practices


Other Lawyers & Law Firms in Sarasota

Show All