Tag Archives: fee splitting

Compounding Pharmacy Shells Out $3.775 Mil to Settle False Claims Suit

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bonus calculationA Jacksonville compounding pharmacy has agreed to pay $3.775 million to settle false claims allegations that it defrauded TRICARE. MediMix Specialty Pharmacy billed TRICARE for compounding pain prescriptions that came from an improper referral source. MediMix’s top-prescriber over a period of five years was also married to one of MediMix’s senior vice presidents. MediMix itself was one of TRICARE’s top billers for compounded pain medications.

Since the federal law limiting physician self-referrals, 42 U.S.C. 1395nn (more commonly called the “Stark law”) does not apply to TRICARE, the government proceeded under a law entitled Administrative Remedies for Fraud, Abuse, and Conflict of Interest, 32 C.F.R. 199.9, which is applicable for claims submitted to CHAMPUS and TRICARE. This law is much more broad than the Stark law. While the Stark law contains specific exceptions, this law does not. Continue reading →

Breaking Down Legal Buzzwords: Fair Market Value & Commercial Reasonableness

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book-stacks-colorful.jpgBy: Jackie Bain

Federal fraud and abuse laws often require that arrangements between health care providers are “fair market value” and “commercially reasonable.” And while these terms look like legalese and are easy to overlook, in fact, they are important. For example, the Federal Stark law requires strict compliance with its terms. A physician may enter into a prohibited arrangement with the intention that it falls within an exception to the law. If, however, the arrangement is not fair market value, the physician’s arrangement would violate the law, subject the physician to fines and risk the physician’s ability to participate in Medicare.  Continue reading →

Florida Medical Spas: Regulators Look Beyond the Surface

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money syringeThere is no such thing as a “medical spa” in Florida.  True!  They are not uniquely licensed.  In fact, they are usually not licensed at all because (1) they are owned and operated by licensed healthcare professionals, and/or (2) they do not file claims for reimbursement with health insurers.  And they are not a regulated entity.

What then is a “medical spa”?  If you want the long answer, go here. The short answer is It’s simply a place where people receive traditional spa services (e.g. facials), plus many other medical procedures, typically focused on cosmetic services (e.g. hair removal, Botox).   It’s “medical” because of the nature of the services provided.  It’s “medical” because (ideally) physician supervision is woven into the business model.

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Kill H.R. 2914

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Background

H.R. 2914 is a bill filed by Congresswoman Speier that is intended (among other things) to prohibit medical practices providing the following sorts of medical services (“Non-ancillary Services”) to their own patients—

*The technical or professional component of (i) surgical pathology, (ii) cytopathology, (iii) hematology, (iv) blood banking, or (v) pathology consultation and clinical lab interpretation services

*Radiation therapy services and supplies

*Advanced diagnostic imaging studies (which include for instance MR and CT)

*Physical therapy services

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Gift Giving and the Anti Kickback Law

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Even though the holiday season is long gone Healthcare Providers need to pay attention to the value of gifts they give or receive to avoid violating the Anti Kickback Laws. Providers may not accept any one gift with a value of more than approximately $30.00 or gifts worth more than $350.00 annually. The Government is concerned that gifts may cause billing for unnecessary services or may affect the referral of patients. Providers as well as their employees must not solicit gifts either. When a gift is given or received it must not be based upon either the volume or value of any referrals. Gifts that are given frequently after referrals or after any specific successful referral are red flags for violations of the law. In fact the Sunshine Act now requires pharmaceutical companies and durable medical equipment companies to report gifts to providers with a value over $25.00. Continue reading →

Split-Fee Soup: A Recipe for Disaster

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Cauldron-psd74325By: David Hirshfeld

When people ask me what I do, I used to say “I’m a transactional health care attorney.  I represent health care practitioners in their business deals.  I don’t do malpractice.”  That response does little to wipe the blank stare off my questioner’s face, and even I have to stifle the urge to yawn.  My new and improved response is that “I spend a lot of time advising health care practitioners how they can share fees with people who refer them patients.”  Now I get invited to all sorts of cocktail parties !!!

Practitioners split fees with one another for a variety of reasons; and they very often do not realize that a particular arrangement involves a split-fee arrangement, or that split-fee arrangements are often illegal in Florida.  The purpose of this article is to provide practitioners with a general overview of the concepts underlying the prohibition against split-fee arrangements in Florida, in the context of three common business arrangements. Continue reading →

Recovery Business Marketing Not Immune from Anti Kickback Exposure

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Many business people involved in some aspect of the recovery business world (e.g. IOPs, PHPs, Detox) are not aware of the punishing laws that apply to their marketing arrangements.  Simply paying someone a commission based sales compensation without fully appreciate the applicable laws is dangerous and costly.

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Fraud & Abuse Enforcement Soars Sky High

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Investigations and successful prosecutions for violation of laws like the Anti Kickback Statute (“AKS”), the Stark Law and the False Claims Act were dramatically up in 2011 and are expected to climb still higher in 2012. For instance 13 doctors were charged in December, 2011 with violating the AKS by receiving payment for referring patients to an MRI center. Physicians and other healthcare business people MUST have any suspect arrangement closely scrutinized by highly qualified counsel. A “suspect arrangement” is any arrangement between providers of healthcare services that involve, to any degree, the exchange or payment of anything of value, including money. The AKS is a criminal statute; and the risks of enforcement are now huge.
Business and arrangements which are designed at all to lock in physician referrals carry particularly large risks and require close scrutiny. For instance, surgery centers that received referrals from non-owner physicians viewed that as a great thing. Now, referrals from unaffiliated physicians are viewed as inherently suspect. “What,” the regulator thinks, “is driving this referral? What wrongful conduct is being engaged in here?” This is especially so with any marketing arrangement as well.

Physicians and other healthcare business people would do well to recall that if even “one purpose” of the arrangement is to compensate (cash or anything of value) someone for a patient referral, the AKS is triggered. Moreover, where Safe Harbor Act compliance was recommended, many now find it necessary.


Consignment Closets: Still a Viable Option for DME Providers

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In the age of heightened regulatory scrutiny, physicians and other health care providers often question whether “Consignment Closet” relationships are legal.  If properly structured these arrangements are not only legal but are of great benefit to patients needing valuable medical devices.  A properly structured relationship will, in all probability, withstand a regulatory challenge by the Office of Inspector General or from other regulatory authorities. Continue reading →

D.C./M.D. Arrangements Share Legal Issues Nationwide

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Chiropractors and medical doctors (or D.O.s) have had a long and somewhat complex relationship. Though they approach healthcare issues differently, there are many instances where they share care or even work together. Such “M.D./D.C.” relationships are legally complex, but often prove to be rewarding in many respects. Properly constructing the arrangements is critical, especially since government regulators and payers tend to view such arrangements with skepticism, alleging that the true reason for the combination is for chiropractors to avoid coverage restrictions.

The core legal issues the parties need to be aware of include: Continue reading →