HCCA 2016: Physician Arrangement Integrity

John Steiner, Chief Compliance and Privacy Officer, and Associate General Counsel, Cancer Treatment Centers of America
Gail Peace, President, Ludi
Jerry Burgess, Chief Corporate Responsibility Officer, AMITA Health

‍

Stark Law has recently hit the healthcare spotlight and is often framed as fraud. Though fraudulent arrangements do exist, Stark also leaves no margin for simple error due to structure as an exception statute. Rather than specifying the exclusion, Stark enacts a blanket prohibition unless specifically indicated exceptions are accommodated. Prosecution for Stark does not require intent on the offending party and technical violations missing one or more elements of stated safe harbors are all too frequent.

‍

When it comes to contracting and Stark, the front end deals with actually setting up an initial contract while and the back end is concerned with the ongoing execution of a contract. Compliance with the original negotiation deals with proper notation of expected duties and commercial reasonableness and FMV documentation. Once the upfront work is done of satisfying safe harbor requirements, it is important to remain vigilant for compliance risks inherent in the execution and maintenance of a contract. In this regard, the speakers shared a few pitfalls to look out for:

‍

• Process risks, such as when a contract ends and a physician continues to perform duties and receive payments, when duties are not actually checked against time logs, or when illegible or late time logs are compensated, among others.
• Agreement parameters are unclear, such as when duties aren’t clearly outlined, incorrect information is recorded, or duplication in agreements for the same physician, among others.
• FMV is breached, such as when a payment maximum is exceeded, calculations are incorrect or too complex to follow, or when layering of agreements leads to duplication, among others.

‍

As you can see, the risks for a technical Stark violation are many. From here, the speakers turned to sharing their best practices for active management of contracts. It is not only key to have a process, but equally critical for that process to designed in such a way that maximizes the efficiency and success of its administration. Best practices include:

‍

• Removing steps that don’t add value. Your process can have 10 steps or it can have 50 steps. What is important is that is you ask the right questions within a manageable time frame.
• Collect time logs for all non patient care activities for both employed and independent physicians.
• Standardize and streamline duties. It is time consuming to check outlined duties against each month’s time log. Errors are far more likely when every contract has uniquely written duties; instead, consider using a template of duties for each type of contract with room for a few unique duties tailor to the role.
• Approvers should be trained and have clear accountability. Expectations should be set with every approver and there should be a consistent review process for every type of contract.
• Mind the math with every payment. Every time you make a payment, you must make sure that payment falls within FMV. Paying physicians for hours over their monthly or annual maximum or pay for duties not included in their contract all constitute a breach of FMV.