Providers need to comply with all the Medicare ‘red tape’ but need not let fear of non-compliance inhibit their practice from offering Durable Medical Equipment Prosthetics & Orthotics Supplies (“DMEPOS”) to Medicare beneficiaries.
Here’s an overview of the steps providers need to take to enroll as a supplier of DMEPOS with Medicare to be eligible for Part B coverage and reimbursement:
I’d run out of fingers and toes if i had to recount the rash of remarkably bad legal guidance given to well meaning chiropractors looking to integrate various medical services to their practice. They hook up with an experienced business firm, a Management Company, that specializes in that area, but then get advice from a buddy or a lawyer who simply doesn’t have the depth of experience to correctly advise them. The Management Company is happy because they don’t know the lawyer is oversimplifying things, which has the effect of a stream of chiropractor clients rolling into the Management Company. Well done, except it’s often not!
In 2015, Assistant Attorney General Leslie Caldwell spoke publicly about the importance for every healthcare provider to not only have a compliance program on its shelf, but also being sure that the compliance program is “tailored to the unique needs, risks and structure of each business or industry.” Assistant Attorney General Caldwell explained, “the adequacy of a compliance program is a factor when [the DOJ] decide[s] how and whether to prosecute a company. The lack or insufficiency of a compliance program can have real consequences for a company when a violation of law is discovered.”
Healthcare regulatory compliance is too damn complicated sounding and scary! What the heck does it even mean? Basically it means making sure you’re following about a dozen specific laws, some of which interrelate. It’s a little like making a cake. You have to make sure you have flour, eggs, sugar and so on. And then you have to make sure you put enough in the bowl and bake it at the right temperature. So what’s so unique re healthcare regulatory compliance? Healthcare professionals and businesses are inundated by these confusing laws written in legalese, to the point where they go numb. They lose the ability to focus on them and to take them seriously. And they hire someone that uses the word “consultant” or “compliance”; and they think they’ve got compliance covered. But they don’t. And that’s a big mistake in the healthcare world!
Concepts that drive sober home relationships like Anti-Kickback Statute, Patient Brokering Act and Safe Harbor have become ingrained in the minds of nearly every addiction treatment provider’s thought process, especially in Florida with the development of the Sober Home Task Force. Providers now seem to fully embrace ideas like–
There’s a federal law (the Anti-Kickback Statute, the “AKS”) that can bring criminal liability for marketing done incorrectly;
There’s a state law, the Florida Patient Brokering Act (“PBA”), that can do the same;
Complying with the federal safe harbors and the bona fide employee exception is important, even when there are no state or federal healthcare program dollars involved;
Paying anyone for marketing, not just on a commission based sales model, without fully appreciate the applicable laws is dangerous, costly and invites criminal inquiries and liability; and
Achieving compliance with applicable federal law should be part of any recovery business’ overall compliance plan.
Recovery providers must become familiar with not only the AKS and state restrictions like the PBA, but also the law’s permitted examples, so called “Safe Harbors,” which specify specifically permitted arrangements (42 CFR 1001.952). The “personal services arrangement and management contract” Safe Harbor, for instance, has particular application in the area of marketing, as does the AKS exception for “bona fide employment arrangements,” which apply to “bona fide” W-2 employees (entailing direction, supervision and control), but not independent contractor relationships.
On Thursday, February 11, 2016, the United States Attorneys’ Office from the Middle District of Florida announced a $10 million settlement with 4 physicians and 2 pharmacies regarding alleged abuses of Tricare program. The case against these physicians and pharmacies was prosecuted as part of the United States government’s large-scale effort to combat questionable compounding practices. Investigations revealed that patients were often prescribed compounded drugs that they never used, and that Tricare paid a mark-up cost of nearly 90% for compounded drugs over and above the pharmacy’s actual costs of making the drug. Roughly 40% of the claims submitted by the pharmacies in question were written by 4 physicians with an ownership or financial interest in the pharmacies.
Tricare is a federal health care program designed to insure active duty military service members, reservists, members of the National Guard, retirees, survivors and their families. Tricare outpatient costs have almost doubled in the last 5 years, and compound drugs have accounted for a large portion of that increase.
Providers of healthcare items or services are well-served to take note: a Federal Court of Appeals has recently held that “the Anti Kickback Statute prohibits a doctor from receiving kickbacks that are made in return for a referral. It does not require that the referral be made in return for a kickback.” Thus, receiving any unauthorized payment from a health care provider to whom you send patients is a very bad idea.
The Federal Anti-Kickback Statute, 42 USCS § 1320a-7b(b) states, in pertinent part, that a person may not knowingly or willfully solicit or receive any remuneration directly or indirectly, overtly or covertly, in cash or in kind, in return for referring an individual for the furnishing of a healthcare item or service that is payable in whole or in part by a Federal healthcare program. In laymen’s terms, a person cannot pay or receive anything of value in return for furnishing a Medicare patient to receive a healthcare item or service. (Note, however, that the law does set forth examples of permissible payments, or “safe harbors,” but we won’t address those in this article.)
Across the healthcare industry, providers and healthcare businesses are consistently faced with the decision of whether to employ or contract with their workers. Whether it’s a physician working with a group practice, or a marketer on behalf of a healthcare service, correctly structuring relationships between healthcare businesses and their workers is important. For tax reasons, many workers strongly prefer to enter into independent contractor relationships. However, simply calling oneself an independent contractor is not enough to solidify the relationship. Many times, workers who call themselves independent contractors are actually employees in the minds of the government. And sometimes, so-called “employees” with several part-time positions are actually viewed as independent contractors.
On July 15, 2015 the Administrator of the Department of Labor’s Wage and Hour Division (WHD) provided additional guidance regarding the application of the standards for determining who is an employee under the Fair Labor Standards Act (FLSA). The goal of the guidance is to help the regulated community in classifying workers and decreasing misclassification. The Administrator’s Interpretation reviews the pertinent FLSA definitions and the breadth of employment relationships covered by the FLSA. The Administrator’s Interpretation then addresses each of the factors of the “economic realities test”.
According to the Administrator, when determining whether a worker is an employee or independent contractor, the application of the economic realities factors should be guided by the FLSA’s statutory directive that the scope of the employment is very broad. The FLSA’s definitions establish the scope of the employment relationship under the Act and provide the basis for distinguishing between employees and independent contractor.
The Supreme Court and Circuit Court of Appeals have developed a multi-factorial “economic realities” test to make the determination whether a worker is an employee or an independent contractor under the FLSA. The test focuses on whether the worker is economically dependent on the employer or in business for him or herself. The factors include:
A 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.
When a physician cannot bill for test results, and a company offers to give that physician those test results for free, a Florida Federal Court has ruled that the company is offering the physician prohibited remuneration. On May 5, 2014 the Middle District of Florida granted partial summary judgment on the latest motion in a contentious litigation between Ameritox Ltd. and Millennium Laboratories, Inc. Ameritox and Millennium are competitors and clinical laboratories that screen urine specimens for the presence of drugs.
Millennium provided free point of care testing cups to physicians, who use the cups for initial testing and then return the cups back to Millennium for confirmation tests. Physicians do not bill patients or insurance companies for the point of care tests.
Health law is the federal, state, and local law, rules, regulations and other jurisprudence among providers, payers and vendors to the healthcare industry and its patient and delivery of health care services; all with an emphasis on operations, regulatory and transactional legal issues.