Physicians & Facilities Frustrated in Upcharging Lab Fees

Licensed healthcare providers and facilities (including many drug and alcohol recovery businesses) who enter into arrangements with clinical labs to provide services to their patients and who then wish to charge more for those lab services will be very disappointed to learn about the restrictions under Florida law.

Section 456.054, Florida Statutes prohibits “kickbacks” and reads—

(1) As used in this section, the term “kickback” means a remuneration or payment, by or on behalf of a provider of health care services or items, to any person as an incentive or inducement to refer patients for past or future services or items, when the payment is not tax deductible as an ordinary and necessary expense.

(2) It is unlawful for any health care provider or any provider of health care services to offer, pay, solicit, or receive a kickback, directly or indirectly, overtly or covertly, in cash or in kind, for referring or soliciting patients.

(3) Violations of this section shall be considered patient brokering and shall be punishable as provided in s. 817.505.

The issue involved in a provider or facility charging more for lab services than they were charged by the lab itself is that the prohibition above applies to healthcare providers and “any provider of healthcare services.”  Regulators may find any reduced fee by the lab to constitute a kickback in exchange for a volume of patient referrals.

A related issue has to do with Florida insurance laws that pertain to charging more for an item or service than the provider or facility was charged.  For instance, if Lab 1 charges the provider/facility $10 for lab work, and the provider/facility charges an insurer $20, that can be found to constitute insurance fraud.

The key Florida prohibition, however, is found in the Florida Administrative Code, which reads—

59A-7.037 Rebates Prohibited – Penalties.

(1) No owner, director, administrator, physician, surgeon, consultant, employee, organization, agency, representative, or person either directly or indirectly, shall pay or receive any commission, bonus, kickback, rebate or gratuity or engage in any split fee arrangement in any form whatsoever for the referral of a patient. Any violation of Rule 59A-7.037, F.A.C., by a clinical laboratory or administrator, physician, surgeon, consultant, employee, organization, agency, representative, or person acting on behalf of the clinical laboratory will result in action by the agency under Section 483.221, F.S., up to and including revocation of the license of the clinical laboratory. In the case of any party or individual not licensed by the agency acting in violation of this Rule, a fine not exceeding $1,000 shall be levied and, as applicable, the agency shall recommend that disciplinary action be taken by the entity responsible for licensure of such party or individual.

(2) No licensed practitioner of the healing arts or licensed facility is permitted to add to the price charged by any laboratory except for a service or handling charge representing a cost actually incurred as an item of expense. However, the licensed practitioner or licensed facility is entitled to fair compensation for all professional services rendered. The amount of the service or handling charge, if any, shall be set forth clearly in the bill to the patient.

(3) Each licensed laboratory shall develop a fee schedule for laboratory services which shall be available to the patient, the authorized person requesting the test or agency upon request and shall be subject to subsection 59A-7.037(2), F.A.C.

In this era where healthcare providers and facilities are struggling to hold onto dwindling profit margins, it is understandable why some are considering arrangements with clinical labs.  Still, Florida providers and facilities have to be extremely cautious when entering into such arrangements.

 

2012 Florida Legislature Impacts Healthcare

When Florida’s legislators meet each year, change is sure to follow.  Some of the changes this year include:

Therapeutic Spa Services are now defined under the nursing home law (Chapter 400) as “bathing, nail and hair care services and other similar services related to personal hygiene.”  The new law will likely trigger the development of regulations that will affect how such services can be provided to residents of nursing homes and related facilities.

The Florida Health Care Clinic Law (400.990) has been changed to allow exempt “big businesses” from the licensure requirements.  Those include—entities that have $250 Million or more in annual sales (if one of the owners is a Florida licensed healthcare professional who is responsible for compliance) and those which employ 50 or more Florida licensed M.D.s or D.O.s who provide services under single tax ID number.  These changes may help physician integration moves but also benefit large corporate healthcare providers.

The state anti kickback law (483.245) was expanded to clarify that it is illegal for a clinical lab to provide (in any way at all) personnel to perform “any functions or duties” in a doctor’s office unless the lab and the doctor’s office are owned by the same legal entity.  Clinical labs may not, for instance, lease space in doctor’s offices to collect specimens.

 

Perhaps the most hotly regulated aspect of healthcare lately has been in the area of controlled substance prescription and dispensing.  A new law expands the exemption from the controlled substance prescribing standards to certain board eligible doctors (not just board certified ones), to rheumatologists and to doctors who prescribe medically necessary controlled substances to a patient during an inpatient hospital stay.   As such, the exemption from the controlled substance prescribing standards—board eligible or certified anesthesiologists, physiatrists, rheumatologists, neurologists or medical specialist who have completed a fellowship in pain medicine; board certified doctors with privileges as a hospital or ASC; doctors who prescribe medical necessary controlled substances to patients during inpatient stays at hospitals.

 

The Florida Healthcare Law Firm Goes National

Followers & Friends – BIG Announcement coming out today! If you haven’t seen our new NATIONAL platform, check it out here at www.nationalhealthcarelawfirm.com and stay tuned for our #healthcare #legal news at 2pm EST !!!

Supreme Court upholds Obama health care law

Via @USAToday

The Supreme Court upheld President Obama’s health care law today in a splintered, complex opinion that gives Obama a major election-year victory.

Basically. the justices said that the individual mandate — the requirement that most Americans buy health insurance or pay a fine — is constitutional as a tax.

Chief Justice John Roberts — a conservative appointed by President George W. Bush — provided the key vote to preserve the landmark health care law, which figures to be a major issue in Obama’s re-election bid against Republican opponent Mitt Romney.

The government had argued that Congress had the authority to pass the individual mandate as part of its power to regulate interstate commerce; the court disagreed with that analysis, but preserved the mandate because the fine amounts to a tax that is within Congress’ constitutional taxing powers.

The announcement will have a major impact on the nation’s health care system, the actions of both federal and state governments, and the course of the November presidential and congressional elections.

A key question for the high court: The law’s individual mandate, the requirement that nearly all Americans buy health insurance, or pay a penalty.

Critics call the requirement an unconstitutional overreach by Congress and the Obama administration; supporters say it is necessary to finance the health care plan, and well within the government’s powers under the Commerce Clause of the U.S. Constitution.

While the individual mandate remained 18 months away from implementation, many other provisions already have gone into effect, such as free wellness exams for seniors and allowing children up to age 26 to remain on their parents’ health insurance policies. Some of those provisions are likely to be retained by some insurance companies.

Other impacts will sort themselves out, once the court rules:

— Health care millions of Americans will be affected – coverage for some, premiums for others. Doctors, hospitals, drug makers, insurers, and employers large and small all will feel the impact.

— States — some of which have moved ahead with the health care overhaul while others have held back — now have decisions to make. A deeply divided Congress could decide to re-enter the debate with legislation.

— The presidential race between Obama and Republican challenger Mitt Romney is sure to feel the repercussions. Obama’s health care law has proven to be slightly more unpopular than popular among Americans.

Full Story Here: http://content.usatoday.com/communities/theoval/post/2012/06/Supreme-Court-rules-on-Obama-health-care-plan-718037/1#.T-xqPhd5F9E

The Florida Healthcare Law Firm Announces National Expansion

(Delray Beach, FL) June 21st, 2012 – The Florida Healthcare Law Firm, one of Florida’s leading healthcare law firms, today announced a major increase in their legal practice capabilities with the official launch of the National Healthcare Law Firm, a d/b/a and new portal of the firm. The expansion to a national platform providing healthcare legal services to physicians and healthcare businesses is one that significantly increases resources for clients who lack qualified local healthcare counsel. While the Florida Healthcare Law Firm has for years assisted clients outside the state of Florida*, this new development further cements the firm’s commitment to providing ethical legal counsel in the healthcare industry.

“We are very excited about it. The fact that we serve clients all over the country has been a small secret for a while but we realized there’s a huge demand and decided to just go for it,” said Jeffrey L. Cohen, Esq. Founder and President of Florida Healthcare Law Firm.

According to Cohen, “It’s just a strange area of the law.  Nearly everything in healthcare business is regulated; leases, employment agreements, compensation.  Things you wouldn’t think are regulated are strongly regulated.  And there are large fines and criminal penalties for getting it wrong!  Our clients understand that healthcare business of any kind has serious legal risks and that they need uniquely qualified help.”

To request a service list or for any other firm information, call Autumn Piccolo at 888-455-7702 or visit the firm’s website at www.nationalhealthcarelawfirm.com or www.floridahealthcarelawfirm.com

*     *     *

Acknowledged throughout the country for its service and excellence, Florida Healthcare Law Firm is one of the nation’s leading providers of healthcare legal services. Founded by Jeffrey L. Cohen, Esq and headquartered in South Florida, FHLF provides legal services to physicians and healthcare businesses with the right pricing responsiveness and ethics. From healthcare clinic regulation, home health agency representation and physician contracting to medical practice formation/representation and federal and state compliance matters, the Florida Healthcare Law Firm is committed to bringing knowledge and experience to a diverse group of clients.

How Many Lobbyists Does It Take to Write A Statute ?

By: David W. Hirshfeld, Esq.

When the text of the new PIP law became public, our jaws went slack.  The new law imposed incongruous effective dates that would seemingly put many providers out of the PIP business for six months.  How could the insurance industry’s best and brightest have screwed this up?

The new law requires providers to be licensed as “clinics” in order to receive PIP payments, unless an exclusion to that licensing requirement applies.  The incongruity arises because the provision requiring licensure seems to become effective July 1, 2012; but the provision creating the exclusions from that licensure requirement do not seem to become effective until January 1, 2013.  Many providers are rightly concerned that they must either: become licensed as a clinic in order to receive PIP payments, or stop treating PIP patients from July 1, 2012 through January 1, 2013 when an appropriate exclusion will exist.

Thank goodness for Stuart Williams, AHCA’s General Counsel.  In his May 8, 2012 memorandum, Mr. Williams artfully reasons that the statute could and should be interpreted so that both the licensure requirement and its applicable exclusions become effective January 1, 2013.  Now most providers can continue to treat PIP patients without interruption.  Whew!!!

We hope and expect that Florida’s Office of Insurance Regulation will adopt Mr. Williams’ reasoning and educate the PIP insurers.

OIG SLAMS COMPANY MODEL ANESTHESIA ARRANGEMENTS WITH SURGERY AND ENDO CENTERS

A long awaited opinion from the OIG on relationships between surgery, endoscopy (and other) centers (“Centers”) will doom many arrangements with anesthesiologists.  At the very least, they will have to significantly restructure.

Such “Company Model” arrangements basically involve a way for surgeon investors in Centers to share in the anesthesia services revenue.  These arrangements have always been suspect, but the OIG has been clear that they run afoul of applicable federal law.  In the June 1st OIG Opinion (12-06), two models were proposed, and both were essentially shot down.  The first involved requiring the anesthesiologists who provide services at the Center to engage a management company owned by surgeon owners of the Center to provide management services on a per patient fee basis.  The second, which is far more commonplace, involved establishing a company owned by the surgeons who also own the Center.  The new company would provide the anesthesia services and contract with the anesthesiologists in a way the leaves some of the anesthesia services income to be distributed to the surgeon in the Center, who also happen to generate all the cases for the Center, and hence all of the anesthesia revenue.

Such arrangements are not only “inherently suspect,” as described by the OIG, they have never made much common sense.  How is it not a kickback for the anesthesiologists to make 100% of the anesthesia related profit on Monday, but then have to “share” it with the surgeon owners on Tuesday, once a new management company or separate anesthesia services company (owned by the surgeons) is formed?

At the very least, surgeons looking for a share of anesthesia revenue will have to dig deep into the opinion and into prior opinions to see if there is any legitimate basis available.

Compliance Alert for Providers Operating as Independent Diagnostic Testing Facilities

The Florida Medicaid program does not enroll or reimburse for the services performed by an Independent Diagnostic Testing Facility (IDTF). Medicaid policy allows physicians practicing in an IDTF to enroll as a physician group so that they may only bill Medicaid for the professional component when services are rendered at the IDTF. Florida Medicaid does not reimburse for the technical component or global fee for services performed by an IDTF. This is not a new policy and it applies to both physician-owned and non-physician-owned IDTFs. This notice is being provided to you in anticipation of Agency-conducted audits regarding this policy.

If your practice is performing diagnostic testing, the global fee (or technical component) is only properly reimbursed when your practices’ physicians are also the treating providers (for the patient’s condition that warranted the testing). Physician practices that do not include the treating provider should immediately stop billing Medicaid for the global fee and/or technical component for diagnostic testing. Also, providers may choose to voluntarily conduct a self-audit and repay any overpayments prior to an Agency-conducted audit. When the Agency conducts an audit, it is entitled to recover the costs of the audit and is required to assess sanctions for the non-compliance.

It is recommended that you review claims from January 1, 2011, to present and submit self-audit findings as well as a refund check to the Agency for any improper payments detected in the audit. A provider who conducts a self-audit, submits the results, and remits payment, may avoid sanctions for the voluntary disclosure and repayment of overpayments. Information about conducting self audits, as well as the contact information for your local area office, is available on the agency’s website.

Questions specific to the anticipated recoupment project may be directed to Kelly Bennett via email at [email protected]. Please include the question in the email as opposed to a request for a return phone call.

HHS PROPOSES ONE-YEAR DELAY OF ICD-10 COMPLIANCE DATE

Via CMS Online 4-9-2012

Action:

The Department of Health and Human Services (HHS) today announced a proposed rule that would delay, from October 1, 2013 to October 1, 2014, the compliance date for the International Classification of Diseases, 10th Edition diagnosis and procedure codes (ICD-10).

The ICD-10 compliance date change is part of a proposed rule that would adopt a standard for a unique health plan identifier (HPID), adopt a data element that would serve as an “other entity” identifier (OEID), and add a National Provider Identifier (NPI) requirement. The proposed rule was developed by the Office of E-Health Standards and Services (OESS) as part of its ongoing role, delegated by HHS, to establish adopt standards for electronic health care transactions under the Health Insurance Portability and Accountability Act of 1996 (HIPAA). OESS is part of the Centers for Medicare & Medicaid Services (CMS).
Background

On January 16, 2009, HHS published a final rule to adopt ICD-10 as the HIPAA standard code sets to replace the previously adopted ICD–9–codes for diagnosis and procedure codes (see HIPAA Administrative Simplification; Modifications to Medical Data Code Set Standards to Adopt ICD-10-CM and ICD-10-PCS, 74 FR 3328). The compliance date set by the final rule was October 1, 2013.

Implementation of ICD-10 will accommodate new procedures and diagnoses unaccounted for in the ICD-9 code set and allow for greater specificity of diagnosis-related groups and preventive services. This transition will lead to improved accuracy in reimbursement for medical services, fraud detection, and historical claims and diagnoses analysis for the health care system. Many researchers have published articles on the far-reaching positive effects of ICD-10 on quality issues, including use of specific reasons for patient non-compliance and detailed procedure information by degree of difficulty, among other benefits.

Some provider groups have expressed serious concerns about their ability to meet the October 1, 2013 compliance date. Their concerns about the ICD-10 compliance date are based, in part, on implementation issues they have experienced meeting HHS’ compliance deadline for the Associated Standard Committee’s (ASC) X12 Version 5010 standards (Version 5010) for electronic health care transactions. Compliance with Version 5010 is necessary prior to implementation of ICD-10.

All covered entities must transition to ICD-10 at the same time to ensure a smooth transition to the updated medical data code sets. Failure of any one industry segment to achieve compliance with ICD-10 would negatively impact all other industry segments and result in rejected claims and provider payment delays. HHS believes the change in the compliance date for ICD-10, as proposed in this rule, would give providers and other covered entities more time to prepare and fully test their systems to ensure a smooth and coordinated transition among all industry segments.

Provisions of the proposed rule announced today

HHS is proposing to change the ICD-10 compliance date to October 1, 2014.

As stated, the ICD-10 compliance date change is part of a proposed rule that would adopt a standard for a unique health plan identifier (HPID), adopt a data element that would serve as an “other entity” identifier (OEID), and add a National Provider Identifier (NPI) requirement.

Standards compliance date

HHS proposes that covered entities must be in compliance with ICD-10 on October 1, 2014.

The proposed rule, CMS-0040-P, may be viewed at www.ofr.gov/inspection.aspx.

A news release on the proposed rule may be viewed at http://www.hhs.gov/news.

10 Lesser Known Effects of Healthcare Reform Law

This is a great article published by CNN this morning.

View it in it’s entirety Here

(CNN) — On Monday, the U.S. Supreme Court takes on a political, social, economic and medical hot potato: the health care reform law that was signed into law two years ago.

For six hours during each of the next three days, attorneys will argue and justices will consider legal questions about the constitutionality of the Affordable Care Act’s individual mandate and issues surrounding federal versus state powers.

Read a transcript of Monday’s Supreme Court arguments

Many of the law’s major aspects have been the topic of much discussion. But are you aware that deep within the sweeping law’s 2,700 pages are many lesser known changes that could affect your life in unexpected ways?

CNN Explains: Health care reform

1. How many goodies your doctors get

Is your doctor prescribing you certain drugs because those are the best for your condition or because of a pharmaceutical company’s influence? Here’s one way you can find out.

The Physician Payment Sunshine Act under health care reform requires drug, device or medical supply companies to report annually certain payments or things of value that they’ve given physicians and teaching hospitals. This could be speaking fees, consulting fees, meals and travel. So, you can find out which and how much companies pay doctors or health care workers. The companies are obligated to report annually about physician ownership and their financial investments.

Continue Reading Here