Improving Your Practice

Virtual Health Care May Become All the Rage

August 22, 2016 | Little Health Law

mobile-phone-in-hand-1438231-1-m How could it not?

The healthcare industry is rapidly evolving. As recently reported in U.S. News and World Report, next on telemedicine’s horizon may be virtual care clinics. In fact, so-called virtual care will likely revolutionize the delivery of health care in the coming years. “Virtual,” in this context, alludes to the fact that care providers, doctors, nurses and therapists, may provide most care from many miles away.

Georgia Health Care Law Firm

Various genres of “virtual care” delivery exists already. One notable pioneer is Mercy Virtual. Mercy, based in Chesterfield, Missouri, emphasizes that an objective of its mission is to ensure access to quality care, explaining: “Mercy Virtual’s mission is to connect patients with leading care providers whenever, wherever they need help.” In recent years, many other medical businesses are finding and developing their own niches in the evolving virtual healthcare world. Several of the numerous examples are: Teladoc, which provides online, 24/7 access to primary care physician services; American Well, which claims to offer “telehealth” to more than 100 million people in an online marketplace where customers select their healthcare provider from a list; Carena provides a range of healthcare services that include virtual visits for the employees of self-insured companies; Zipnosis is a platform that, through “phone and video care,” helps patients get answers to their healthcare questions and helps physicians treat primary care ailments; MeVisit enables “e-visits” that allow patients to use their mobile device to connect with a doctor.

Physicians Continue in Trend of Medicare Opt Outs

February 4, 2016 | Little Health Law

medical-doctor-1314903-m In the past two decades, a growing number of physicians in private practice dissatisfied with reimbursement rates, paperwork and other aspects of the federal Medicare program have opted out of the program. According to an article by William Buczko available on the Centers for Medicare and Medicaid Services (CMS) website that explains the history and details of the Medicare Opt Out process: 2,839 physicians and other providers opted out of Medicare between 1998 and 2002. They comprised 0.42 percent of providers eligible to opt out in that period.

Since then, those numbers have continued to grow, with Medicare officials recently reporting about 4 percent of U.S. physicians and other providers having opted out.

The Opt Out Process

The Medicare Opt Out process requires three steps, according to an article by Physicians Practice. These include:

FMLA Litigation: A Rising Tide Large Healthcare Employers Face

April 28, 2015 | Little Health Law

hospital-corridor-2-65904-m Hospital systems and other large healthcare providers face increasing risks associated with noncompliance with the Family and Medical Leave Act (FMLA), as FMLA litigation is on the rise. According to Law360, FMLA litigation tripled in one year (from 2012 to 2013). Our Georgia business and healthcare law firm has litigated FMLA and numerous other employment law cases in federal court. Because following the regulatory scheme of the FMLA can involve difficult details (e.g., tracking intermittent leave taken in small increments), many employers can violate the Act inadvertently. Retaliation claims are also problematic because of how the employee is treated before and after the medical leave. Tight protocol and committed training of management, supervisors and HR personnel is critical to minimizing the financial risks associated with FMLA noncompliance.

FQHC Section 340B Audit Readiness: A Pound of Prevention

January 25, 2015 | Little Health Law

For Federally Qualified Health Centers and other eligible safety net health care centers, proper utilization of the federal Section 340B Drug Discount Program can offer enormous financial advantages to facilitate delivery of high quality primary health care services to their communities. The Section 340B Program, created in 1992, requires drug manufacturers to provide outpatient drugs to qualifying health care centers and organizations at reduced prices. The purpose of the Section 340B Program is to provide a financial advantage that supports FQHCs and other safety net providers, enabling them to stretch scarce federal resources as far as possible to the benefit of their patients.

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The federal Health Resources and Services Administration (HRSA), which regulates and supervises the Section 340B Program, has legal authority to audit Section 340B Program covered entities. Alternatively, HRSA may authorize a drug manufacturer to audit a covered entity under particular circumstances and according to HRSA’s protocol. An audit is for the purpose of assessing covered entity compliance with HRSA regulations and protocol governing the Section 340B program and, in particular, to identify and remedy diversion of Section 340B drugs or duplicate discounts.

Program Integrity Audits, as they are known, were first initiated in 2012 and have increased each year. Audit results can be reviewed on the HRSA website. A covered entity’s failure to pass audit scrutiny can result in very adverse financial consequences, including having to refund discounts to a drug manufacturer and/or exclusion from the Section 340B Program. Through Fall 2014, approximately 240 audits have been performed. More audits are expected in 2015, as HRSA continues to ramp up its oversight and scrutiny of the Section 340 participants. Many hundreds of FQHCs will be the subject of upcoming audits.

For FQHCs and other covered entities that potentially subject to an audit, the financial stakes are so high that audit readiness should be a top priority. Fortunately, HRSA provides contract pharmacy guidelines that, if properly followed, can reduce the risk of being audited and of a bad audit outcome. For every Section 340B participant, following HRSA guidelines is therefore a must.
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Michigan Bill Would Benefit Direct Primary Care Doctors

September 30, 2014 | Little Health Law

A Michigan legislator’s bill, SB 1033, sponsored by Senator Patrick Colbeck, would benefit direct primary care doctors in that State, and the idea may warrant consideration in other States. The purpose of the bill is to provide physicians who convert their practice to a direct primary care model with the assurance that their medical practice will not be treated as an insurer regulated under state insurance regulations.

Atlanta and Augusta, Georgia Physician Practice Law Firm

Among other legal hurdles some physicians may face in developing a direct primary (or concierge) care practice model is avoiding the creation of an insurance product. This can be a central legal issue for such practices. A distinguishing feature of the direct primary care model is that the patient, sometimes referred to as a “member” or “enrollee,” receives medical care without paying anything other than a predetermined periodic fee, sometimes referred to as a “medical retainer.” The theory behind the insurance issue is that by accepting a set, predetermined fee in advance of the medical services, the physician or medical practice is, in effect, underwriting an insurance risk. The consequences of a state insurance regulator determining that a medical practice is operating as an insurance company can be severe.

Senator Colbeck’s bill is intended to avoid such problems in Michigan. The bill provides, in part, as follows:

(1) A medical retainer agreement is not insurance and is not subject to this act. Entering into a medical retainer agreement is not the business of insurance and is not subject to this act.
(2) A health care provider or agent of a health care provider is not required to obtain a certificate of authority or license under this act to market, sell, or offer to sell a medical retainer agreement.
(3) To be considered a medical retainer agreement for the purposes of this section, the agreement must meet all of the following requirements:

(a) Be in writing.
(b) Be signed by the health care provider or agent of the health care provider and the individual patient or his or her legal representative.
(c) Allow either party to terminate the agreement on written notice to the other party.
(d) Describe the specific routine health care services that are included in the agreement.
(e) Specify the fee for the agreement.
(f) Specify the period of time under the agreement.
(g) Prominently state in writing that the agreement is not health insurance.
(h) Prohibit the health care provider, but not the patient, from billing an insurer or other third party payer for the services provided under the agreement.

Physician Practices: Recent Survey Reviews the Effects of Expanded Patient Access

September 24, 2014 | Little Health Law

A well-intended objective of the Affordable Care Act (ACA) is to improve patient access to doctors. Sometimes this objective is artfully stated as “better” access to care, rather than “increased” access to care, perhaps to acknowledge the reality that as more patients become insured via the ACA, there may actually be less access to physicians. “Better” access may therefore be an argument that, even as an existing physician shortage worsens, new alternatives under the ACA nonetheless improve access to care for the population as a whole. For sure, millions of Americans have enrolled in new insurance coverage via the ACA health insurance exchanges. In any event, whether it will be easier for most Americans to actually see a doctor remains to be seen according to a recent national survey.

The survey, by The Physicians Foundation, concluded that patients are likely to face increased difficulties in finding true access to care if current health care reform trends continue. More than 20,000 doctors nationwide were surveyed by the Foundation, and its findings are detailed and compelling. Among other things, the survey indicates that: 81 percent of doctors believe they are over-extended or at full capacity; only 19 percent of doctors think they have time to see additional patients; and 44 percent of doctors are now planning steps that would reduce patient access to their services (e.g., cutting back on patients seen, retiring, going part-time, closing their practice).
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Health Care Fraud Report: OIG Alert Regarding Laboratory Payments to Referring Physicians

September 16, 2014 | Little Health Law

Clinical laboratory payments to physicians in excess of the fair market value of services provided or that correlate to the volume or value of referrals can constitute health care fraud and trigger very serious civil and criminal penalties. The Department of Health and Human Services’ Office of Inspector General (OIG) recently issued a Special Fraud Alert (the “Alert”) addressing lab compensation to referring doctors and medical practices for blood specimen collection, processing and packaging, and for submitting patient data to a registry or database. Our Georgia health care law firm endeavors to follow updates in health care laws and regulations that impact providers, particularly Stark law and the federal Anti-Kickback Statute (AKS). This OIG Alert warrants caution and careful evaluation of any applicable financial arrangements by affected physicians and medical practices to ensure compliance with federal law.

Labs and physicians: BEWARE of Stark Law and the Anti-Kickback Statute
At the heart of Stark Law and the AKS is the notion that (unlike most other industries) health care business referrals may, under some circumstances, be a bad thing. Kickbacks that corrupt medical judgment about the medical necessity of services, result in the overutilization of medical products and services, increase the cost of federal programs, or that cause unfair competition, are of great interest to the Federal Government and are the intended targets of Stark Law and the AKS.

The AKS, unlike Stark, is a criminal statute, a violation of which requires evidence of criminal intent. However, the OIG may find evidence of such intent even by mere characteristics of a particular financial arrangement, including legal structure, the absence of safeguards, and, of course, actual conduct of the parties regarding the arrangement.
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Negotiating Professional Liability Insurance Protection in Physician Employment Agreements

July 10, 2014 | Little Health Law

In our practice as an Atlanta and Augusta health care law firm, we see varying options regarding professional liability insurance coverage made to physicians in their employment agreements. All doctors apprehend in general that there are financial risks associated with potential malpractice claims. While the need to obtain liability insurance is obvious, the right coverage for particular circumstances and how coverage works can be less obvious. Understanding the type of professional liability coverage proposed in a physician employment agreement and how the coverage mechanics work is an essential first step for physicians who desire a physician employment agreement that will truly protect their long-term financial interests.

The first type of coverage is “occurrence-based” professional liability insurance. Occurrence-based coverage provides lifetime coverage for incidents that occurred during the insurance policy period. This means that even if the policy lapses or is terminated, if a claim is made concerning an incident that occurred while the policy was in force, the claim is covered under the policy. Generally speaking, professional liability policies will define “occurrence” as the actual act or omission of the physician, not the injury of the patient.

A “claims-made” policy, on the other hand, only covers incidents that occurred and were reported during the policy period. If a claims-made policy is dropped or expires, any claims asserted thereafter are not covered, even if the incident occurred during the policy period. Where a physician’s professional liability policy is a claims-made policy, the physician (or his employer) may purchase an “extended reporting” endorsement, otherwise known as “tail” coverage, to cover claims asserted after the policy period.
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HIPAA’s Teeth

July 1, 2014 | Little Health Law

Although most health care providers understand in the abstract that they must comply with The Health Insurance Portability and Accountability Act of 1996 (HIPAA), many may not fully appreciate the legal and financial significance of noncompliance. More and more, the federal government utilizes HIPAA enforcement options to protect the public interest in security, including the following strong incentives for HIPAA compliance.

HIPAA Civil Penalties

Caps on penalties for HIPAA violations by covered entities were increased in 2009 by the enactment of the HITECH Act. Covered entity civil penalties are “tiered” as follows:

No knowledge of HIPAA violation – $100-$50,000 for each violation, up to a maximum of $1.5 million during a calendar year.
A reasonable cause of the HIPAA violation exists – $1,000-$50,000 for each violation, up to a maximum of $1.5 million during a calendar year.
The HIPAA violation was caused by willful neglect but timely corrected – $10,000-$50,000 for each violation, up to a maximum of $1.5 million during a calendar year.
The HIPAA violation was caused by willful neglect but not timely corrected – $50,000 or more for each violation, up to a maximum of $1.5 million during a calendar year

The HITECH Act also offers benefits to encourage patients to report HIPAA violations similar to those offered in qui-tam cases. This allows patients who have been impacted by HIPAA violations to collect a portion of the civil monetary penalty that is imposed against a violator. However, there are three very important exceptions to collecting on this penalty:

The offense is punishable under HIPAA criminal provisions;
The violator did not know and, by exercising reasonable diligence, would not have known of the violation; or
The failure to comply is caused by “reasonable cause” rather than “willful neglect” and the alleged violator takes action to cure the failure during the first 30 days following actual knowledge of the noncompliance or when the person should have known of the noncompliance.

HIPAA Criminal Penalties

Although the DHHS Office for Civil Rights enforces the civil penalties for HIPAA violations, the Department of Justice is the agency in charge of enforcing HIPAA’s criminal penalties. As with the civil penalties, the nature of the HIPAA violation determines the severity of the penalty in regards to criminal sanctions:

If a person knowingly and, in violation of the Privacy Rule, discloses PHI to another individual, they face a base penalty of up to $50,000 in fines and up to a year in prison, or both;
if the offense is committed under false pretenses, they can be fined up to $100,000 and face up to five years in jail, or both;
if the offense is committed with an intent to sell or otherwise use PHI for commercial advantage, personal gain or malicious harm, they can be fined up to $250,000 and face up to 10 years in jail, or both.

Physician Servicing and Consulting Agreements and Transparency

June 21, 2014 | Little Health Law

Medical device companies, pharmaceutical companies or other health care related companies or vendors often seek consulting or personal services from doctors. Physicians should be cautious in such arrangements to avoid legal issues under federal law. Where fair market value compensation is paid for such services, there may be no issue under, for example, the federal Anti-Kickback Statute (AKS). However, arrangements that involve excessive compensation can lead to legal problems and reporting issues.

Physician personal service arrangements may fall within the AKS safe harbor found in 42 C.F.R. § 1001.952(d). Such services provided by the physician must be legitimate and necessary and must meet the following requirements:

1. A written agreement states the specific services and compensation for the services;
2. The term of the agreement must be at least one year; and 3. The compensation must be for fair market value and not fluctuate based on volume or value of the business generated
Transparency in many such arrangements is required by law. The Physician Payment Sunshine Act (PPSA) was enacted pursuant to the Patient Protection and Affordable Care Act of 2009 (ACA). The PPSA requires manufacturers of medical supplies, devices and drugs paid for by certain government programs (e.g. Medicare) to report to the federal government payments made to health care providers, including physicians, that exceed $10 or aggregate payments over $100 annually. Payments covered include consulting fees, royalties, stock options, gifts, entertainment, and other items of value or forms of consideration, subject to a fine of $10,000 per failure to report.
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