Transcript www.med.upenn.edu

Overview of
Health Care
Legal Issues
Bruce D. Armon, Esq., Partner
Business Department
Saul Ewing LLP
Telephone: 215-972-7985
1-800-355-7777, ext. 7985
Email: [email protected]
March 18, 2008
HEALTH LAW SUBJECTS
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Regulation of health care providers
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Credentialing of health care providers
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Reimbursement issues
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Fraud and abuse
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Antitrust
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Tort law
Bruce D. Armon, Esq.
FRAUD AND ABUSE
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The Government's war
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Anti-Kickback statute
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Stark statute
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Criminal prosecutions and civil investigations
Bruce D. Armon, Esq.
ANTI-KICKBACK STATUTE
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Basic prohibition – knowing and willful
solicitation or receipt of any remuneration in
return for referring persons or arranging for
acquisition of goods or services
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Penalties: Criminal and Civil
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Safe Harbors
Bruce D. Armon, Esq.
ESSENCE OF MEDICARE/MEDICAID
ANTI-FRAUD AND ABUSE STATUTE
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Prohibits remuneration to induce referrals
“Remuneration” is broadly defined – e.g.,
opportunity to make money, kickback, bribe,
rebate, anything of value
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Statutory Exceptions
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Judicial Interpretations
Bruce D. Armon, Esq.
SAFE HARBORS
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Bruce D. Armon, Esq.
Common Theme -- FMV; 1+ year
contracts; full disclosure
Intended to protect non-abusive
business arrangements
If it does not fit, it is not necessarily
illegal
SAFE HARBORS
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Investment interests
Space rental
Equipment rental
Personal services and
management contracts
Sale of Practice
Referral Services
Warranties
Discounts
Employees
Group purchasing organizations
Waiver of beneficiary coinsurance
and deductible amounts
Increased coverage, reduced costsharing amounts, or reduced
premium amounts offered by
health plans
Bruce D. Armon, Esq.
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Price reductions offered to health
plans
Practitioner recruitment
Obstetrical malpractice insurance
subsidies
Investment in group practices
Cooperative hospital service
organizations
Ambulatory surgical centers
Referral agreements for specialty
services
Price reductions offered to eligible
managed care organizations
Price reductions offered by
contractors with substantial
financial risk to managed care
organizations.
OTHER INTERPRETATIVE
RESOURCES
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Bruce D. Armon, Esq.
OIG Fraud Alerts
Advisory Opinions
STARK STATUTE
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If a physician (or family member) has a financial
relationship with an entity:
(1) physician may not "make a referral to the entity
for the furnishing of designated health services" for
which payment may be made under Medicare or
Medicaid; and
(2) the entity may not bill for designated health
services furnished pursuant to such referral
Bruce D. Armon, Esq.
WHAT IS A FINANCIAL
RELATIONSHIP?
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An ownership or investment interest in
the entity
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Bruce D. Armon, Esq.
Such interest “may be through equity,
debt, or other means”
An indirect ownership interest is still an
ownership interest
A compensation arrangement, with
certain exceptions
WHAT ARE THE DESIGNATED
HEALTH SERVICES?
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Clinical laboratory services
Physical therapy services
Occupational therapy
services
Radiology, including MRI,
CT scans, and ultrasound
services
Radiation therapy services
and supplies
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Bruce D. Armon, Esq.
Durable medical equipment
and supplies
Parenteral and enteral
nutrients, equipment and
supplies
Prosthetics, orthotics, and
prosthetic devices
Home health services and
supplies
Outpatient prescription
drugs
Inpatient and outpatient
hospital services
ARE THERE EXCEPTIONS
TO STARK?
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Bruce D. Armon, Esq.
These are the most important part of
the analysis to a health care lawyer, and
for our physician-clients.
CATEGORY OF EXCEPTIONS
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Bruce D. Armon, Esq.
Ownership only
Ownership and compensation
Compensation only
EXAMPLES OF STARK
EXCEPTIONS
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Physician group
practices
Personal service
arrangements
Remuneration not
related to the
provision of
designated health
services
Physician recruitment
Bruce D. Armon, Esq.
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Rental of office space
Equipment leases
Bona fide employment
relationships
Isolated financial
transactions
Certain group practice
arrangements with a
hospital
Payments by a physician
for items and services
STARK PENALTIES
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Bruce D. Armon, Esq.
Denial of payment by Medicare
Required refunds of payments made by
individuals
Civil money penalties and possible
exclusion from Medicare and Medicaid
STARK VS. ANTI-KICKBACK
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Bruce D. Armon, Esq.
No proof of intent
Applies to physicians
Improper unless
exception
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Unlawful intent
Any person or entity
Technicalities may
not be penalized
HIPAA
What Is This About?
Bruce D. Armon, Esq.
HIPAA Overview
The Health Insurance Portability and
Accountability Act of 1996 (P.L. 104191) (HIPAA) became law on August
21, 1996. At the time it was commonly
referred to as “Kennedy-Kassebaum”
(after Senators Ted Kennedy (D-MA)
and Nancy Kassebaum (R-KS) who
were instrumental in its passage.)
Bruce D. Armon, Esq.
HIPAA Key Provisions
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Insurance reform - improve portability and
continuity of health insurance for groups and
individuals.
Extend fraud and abuse prevention measures to
all types of insurers (not just Medicare/Medicaid),
and dedicate additional resources to fraud and
abuse enforcement.
Administrative simplification - create a framework
for the standardization of electronic data
interchange (EDI) in health care, including
protections for the privacy and security of
individually identifiable health information.
Bruce D. Armon, Esq.
Administrative Simplification
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Electronic Transactions and Code Sets
Standards
Privacy Standards
Security Standards
Electronic Signature Standards
Identifier Standards
Employer Identifier Standard
Provider Identifier Standard
Health Plan Identifier Standard
Individual Identifier Standard
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Bruce D. Armon, Esq.
Privacy Standards
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Bruce D. Armon, Esq.
Final Rule published December 28,
2000 (65 FR 82462 et seq.)
Final Rule, Version II, published August
14, 2002 (67 FR 53182 et seq.)
Effective Date - April 14, 2003
Privacy Standards
“Health information” is any information, whether oral
or recorded in any form or medium, that:
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Is created or received by a health care provider, health
plan, public health authority, employer, life insurer,
school or university, or health care clearinghouse; and
Relates to the past, present, or future physical or mental
health or condition of an individual, the provision of
health care to an individual, or the past, present, or
future payment for the provision of health care to an
individual.
Bruce D. Armon, Esq.
Individually Identifiable Health
Information
Individually Identifiable Health
Information (IIHI) is health information
that identifies an individual or there is a
reasonable basis to believe could be
used to identify an individual.
Bruce D. Armon, Esq.
Protected Health Information
The focus of the Privacy Rule is Protected
Health Information (PHI). PHI is IIHI that
is transmitted or maintained in electronic or
any other form or medium.
Bruce D. Armon, Esq.
Applicability
Privacy Rule applies to covered entities:
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Bruce D. Armon, Esq.
Health Plans
Health Care Clearinghouses
Health Care Providers
Health Care Providers
Health care providers include any
individual or entity that is covered as a
provider under Medicare or any other
person or organization that provides
medical or other services or who
furnishes, bills or is paid for health
services or supplies in the normal
course of business.
Bruce D. Armon, Esq.
Uses and Disclosures of PHI
When PHI is to be disclosed for purposes of
 Treatment
 Payment
 Health Care Operations
an individual’s consent is not required
pursuant to the Final Rule, Version II
Bruce D. Armon, Esq.
Administrative Requirements
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Privacy official
Contact person for complaints
Training
Safeguards
Complaints
Sanctions
Mitigation
Bruce D. Armon, Esq.
Administrative Requirements
(cont’d)
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Bruce D. Armon, Esq.
Intimidating or retaliatory acts
Waiver of Rights
Policies and procedures
Documentation
Business Associate
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Business Associate means with respect to a Covered
Entity (other than as a member of the workforce) an
entity that performs or assists
In the performance of a function or activity involving
the use or disclosure of individually identifiable health
information, including claims processing or
administration, data analysis, process or
administration, utilization review, quality assurance,
billing, benefit management, practice management and
repricing, or any other function covered by these
regulations.
Bruce D. Armon, Esq.
Preemption of State Law
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Bruce D. Armon, Esq.
General preemption rule. A
requirement or other provision of the
HHS Privacy Rule that is contrary to a
provision of state law preempts the
state law provision unless an exception
applies.
DECIDING WHERE TO
PRACTICE
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Institutional
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Private practice
Bruce D. Armon, Esq.
EVALUATING A PRACTICE
OPPORTUNITY
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Developing your
checklist
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Bruce D. Armon, Esq.
Identify priorities
Determine dealbreakers
THE FIRST INTERVIEW
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Bruce D. Armon, Esq.
Establishing a rapport
Identifying the “nuts” and “bolts” of the
practice
Asking the right questions
THE MAJOR ISSUES
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Bruce D. Armon, Esq.
Compensation -- not
just salary!
Term and
termination
Be aware of the
Agreement’s details
COMPENSATION
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Possible salary
formulas
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Bruce D. Armon, Esq.
Base salary
Base salary PLUS
production or
collections
Production less
overhead
Income Guarantee
NON-SALARY BENEFITS
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Bruce D. Armon, Esq.
Salary is only part of
the equation
Ascertain employer’s
potential flexibility
TERM AND TERMINATION
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Term
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Bruce D. Armon, Esq.
How long is the
initial term?
Automatic renewals
and notice provisions
TERM AND TERMINATION
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Termination
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Bruce D. Armon, Esq.
For cause
Without cause
Timelines for termination
Effects on benefits
MOVING ON
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Non-competition provisions
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Access to patient records and confidentiality
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Settling disputes -- arbitration or litigation?
Bruce D. Armon, Esq.
SYNOPSIS FOR NEGOTIATING
EMPLOYMENT AGREEMENTS
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Don’t rely on a handshake
The devil is in the details
Don’t be afraid to ask for
changes
Enjoy your first professional
practice opportunity (even
though it might seem far
away)!
Bruce D. Armon, Esq.