OIG Publishes Special Fraud Alert Regarding Laboratory Payments To Referring Physicians – Some Arrangements May Violate the Anti-Kickback Statute

The laboratory market has become quite competitive in recent years, raising compliance concerns and investigations into lab relationships with referring physicians. Accordingly, on June 25, 2014, the OIG released a Special Fraud Alert (the “Fraud Alert”) which provides guidance about two different types of suspect arrangements: (1) Blood-Specimen Collection; and (2) Registry Payments. The concerns raised here by the OIG involve referring physicians receiving payments from laboratories who may not even be aware that these arrangements are violating the Anti-Kickback Statute due to their complicated nature.

The OIG explained that it is concerned about arrangements in which a lab pays a physician more than fair market value (“FMV”) for the physician’s services or for services the lab does not actually need or for which the physician is compensated. The four major concerns typically associated with kickbacks involving labs include: (1) corruption of medical judgment; (2) overutilization; (3) increased costs to the Federal health care programs and beneficiaries; and (4) unfair competition. These concerns arise because arrangements with labs could induce physicians to order tests from a lab that provides them with payment, rather than utilizing laboratories that provide the best, most clinically appropriate service. Indeed, the choice of which laboratory to use and whether to even order lab tests are decided by or at least strongly influenced by the physician. Continue reading

New Ohio Sex Offender Requirements for Long Term Care Facilities

Nursing homes, residential care facilities and county homes (“Homes”) in Ohio will soon have additional requirements related to the admission of a registered sex offender. House Bill 483, the Mid-Biennium Budget Review bill was signed by Governor Kasich on June 16, 2014 with an effective date in September 15, 2014. Rules are required to be written by the Ohio Department of Health (“ODH”) in the future for further guidance. Requirements for the Homes include checking the Ohio sex offender registry before admission of a registered sex offender. Facilities can include questions about a registered sex offender status on their admission applications. The Homes must check the potential resident’s name in the required database to determine if the potential resident is an Ohio registered sex offender. If a registerd sex offender is admitted, a care plan must be devleoped to protect other residents and provide a safe environment free of abuse. Also, the Homes must notify residents and their sponsors of the sex offender’s admission and provide a description of the plan of care for safety. Sex offender registry link: http://www.icrimewatch.net/index.php?AgencyID=55149

Flood of Bad CPR News Raises Quality Concerns

McKnight’s news stories can be a good source of ideas for quality improvement projects, long-term care attorney Janet K. Feldkamp recently told a webcast audience. Looking at our recent items, I’d say the time is ripe to review CPR policies: Three separate stories emerged last week about a variety of problems — and penalties — related to resuscitation.

Please click here to view the full atricle.

The Halifax $85 Million Lesson: Compensation Arrangements Between Hospitals and Physicians Must Be Reviewed

The Department of Justice (“DOJ”) announced another multi-million dollar settlement of alleged False Claims Act violations on March 11, 2014. Specifically, Halifax Hospital Medical Center and Halifax Staffing, Inc. agreed to settle various issues with the DOJ for $85 million in order to resolve allegations that they violated the False Claims Act (“FCA”) by submitting claims to Medicare that violated the federal prohibition on physician self-referrals, 42 USC §1395nn (the “Stark Law”). United States ex rel. Baklid-Kunz v. Halifax Hospital Medical Center, et al., No. 09-cv-1002 (M.D. Fla.).

The Stark Law and the Bona Fide Employment Exception

The Stark Law prohibits a physician from referring a patient for certain designated health services (“DHS”) to an entity in which the physician, or an immediate family member, has a financial interest, such as an ownership or investment interest in the entity or a compensation arrangement with the entity. Certain exceptions for arrangements are permitted under Stark. However, because the Stark Law is a strict liability statute, the arrangement must fit completely within the criteria of the exception in order not to violate the statute. At issue in Halifax, as explained below, is the bona fide employment exception, Continue reading

Supplemental Special Advisory Bulletin Clarifies OIG Positions on Independent Charity Patient Assistance Programs

Introduction

The OIG has released a Supplemental Special Advisory Bulletin that “reiterates and amplifies” previous OIG Special Advisory Bulletin guidance from 2005. Pharmaceutical manufacturers and Patient Assistance Programs that provide independent, charitable support for patients’ drug expenses (PAPs) should be aware of this supplemental guidance, as the OIG notes that it may modify some previously-issued favorable advisory opinions. Specifically, in this bulletin the OIG expands on its previous guidance regarding disease funds, eligible recipients, and the conduct of donors.

Background

PAPs provide cost-sharing assistance for patients who cannot afford their prescription medications. Continue reading

OIG Proposes New Revisions to Civil Monetary Penalty Regulations

On May 12th, the Office of the Inspector General of the Department of Health and Human Services (OIG) issued a proposed rule which would amend the federal civil monetary penalty (CMP) regulations addressing new CMP authorities created under the Affordable Care Act.  The revised regulations would allow for civil penalties, assessments, and exclusion from Medicare for :

  • Failure to grant OIG timely access to records;
  • ordering or prescribing while excluded;
  • making false statements, omissions, or misrepresentations in an enrollment application;
  • failure to report and return an overpayment; and
  • making or using a false record or statement that is material to a false or fraudulent claim.

Comments on the proposed regulations can be submitted up until July 11, 2014.  The proposed rule and instructions for submitting comments can be viewed here—> Proposed CMP Regulatory Revisions

For more information on the revisions to the CMP regulations, Fraud and Abuse, Compliance, Medicare Program Integrity initiatives or related issues, please feel free to contact Ari Markenson or any member of our health care practice group for a further discussion.

Skilled Nursing PEPPER Reports Are Now Available Electronically

The second annual Skilled Nursing Facility (“SNF”) Program for Evaluating Patterns and Electronic Reports (“PEPPERs”) are now available to be retrieved via the secure portal at PEPPERresources.org. These reports are accessible to a limited number of high level management personnel within your organization. The Centers for Medicare and Medicaid Services (“CMS”) contracted with TMF Health Quality Institute (“TMF”) for the development, preparation and distribution of the PEPPERs to SNFs, as well as other health care provider types. Continue reading