NAVIGATING THE HEALTHCARE MINEFIELD

John C. Peick, J.D.

PEICK | BOYER LAW GROUP, P.S.

Bellevue, Washington

www.peicklaw.com

425-462-0660

INTERFACES

P A Y E R S

C o -P R O V ID E R S

Y O U P A T IE N T S

R E G U L A T O R S

AVOIDING MISSTEPS

Avoiding Contract Mistakes Group Practices Escalating Regulatory Compliance Demands Billing False Advertising Sexual Misconduct Rewarding Referral Sources

COMMON PROVIDER CONTRACT MISTAKES

Billing for non-credentialed providers Billing for unbundled services Billing wrong codes for services Billing higher time codes without

supporting documentation Collecting discount balances from

patients for covered services (P.I.)

COMMON PROVIDER CONTRACT MISTAKES(cont)

Billing services under inappropriate provider

No or little documentation of services No or little documentation of medical

necessity No or little documentation of

reasonableness

GROUP PRACTICES

Misery Loves Company

OR

The More the Merrier

What is Group Practice

“Group Practice” is generally defined as three or more providers who deliver patient care, make joint use of equipment and personnel, and divide income by a prearranged formula.

Group Practice may be single discipline or multidisciplinary.

Legal Structure of Group Practices

Sole Proprietor with Associates Partners (with or without Associates) Shareholders in Professional Service

Corporation (with or without Associates) Members in Professional Limited

Liability Company (with or without Associates)

Combination of Above Entities

PROFESSIONAL COMBINATIONS

GROUP I

Acupuncturist, Mental Health, Podiatrist, DC, Dental Hygienist, Opticians, Hearing Aid, Naturopathic, Midwifery, Optometry, Ocularist, Osteopathy, D.O. Assistant, Pharmacist, M.D., P.A., Nurses, Psychologist, Respiratory, LMP, Dieticians, Nutritionists

GROUP II

Physical Therapists

Occupational Therapists

Advantages of Group Practice

Increased Economies of Scale in Use of Equipment & Technology

Reduces Per Provider Staff Overhead Increased Marketing Capabilities &

Resources Generates Stable Income Stream Enables Practice to Maximize Utilization

of Associates

Disadvantages of Group Practice

Requires Uniformity in Staff Procedures & Billing

Individual Practice Variations Will Come Under Scrutiny for E&O Exposure

Increased Financial Accountability A General Sense of Loss of Control Requires Team Player Skills

MultiDisciplinary Group Practice Advantages

Same economies of scale as single discipline groups.

Breadth of healthcare expertise is a marketing strength to consumers - One Stop Shopping

Marketing advantage to MCOs Opportunity to deliver more comprehensive

health care solutions with better patient outcomes

Traps for the Unwary

Failure to incorporate as professional services corporation or PLLC

Failure to understand scope of practice limitations

Failure to delineate services provided Failure to bill separately Failure to document reasons for

intercompany referrals

REGULATORY COMPLIANCE

WHERE THE BIG STICK CAN SMASH THE *%*$&$ OUT OF

YOUR LIFE

REGULATORY COMPLIANCE

WHY SHOULD I CARE?

LOMPOC

CAMP SHERIDAN

SOURCES OF RISK

EMPLOYEES

PATIENTS

COMPETITORS

CME/IME REVIEWERS

ATTORNEYS

REGULATORS

PAYERS

YOU

WHAT CAN HAPPEN

Professional Discipline Criminal Investigation Insurance Company Audits Civil Claims by Patients

FEDERAL HEALTHCARE CRIMINAL LAWS

Healthcare Fraud under HIPAA

False Statements relating to Healthcare

Medicare Patient Protection Act

Anti-Kickback & Self-Referral (Stark I & II)

False Claims Act Mail & Wire Fraud Obstruction of

Justice

STATE HEALTHCARE RELATED LAWS

Anti-Rebating (Ch. 19.68 RCW) Healthcare Insurance Claim Trafficking

(Ch. 48.30A RCW ) False Insurance Claims (RCW

48.30.230) Healthcare Fraud (Ch. 48.80 RCW) Criminal Profiteering (RCW 9A.82.010)

STATE LAWS (cont.)

Healthcare Disciplinary Act (RCW 18.130.180)

Self-Referral Prohibitions (DSHS) Medical Records Privacy (Ch. 70.02

RCW)

REBATING - State

RCW 19.68.010(1): It shall be unlawful for any person… to pay, or offer to pay or allow, directly or indirectly, to any person licensed by the state of Washington to engage in the practice of medicine and surgery, drugless treatment in any form, dentistry, or pharmacy and it shall be unlawful for such person to request, receive or allow, directly or indirectly, a rebate, refund, commission, unearned discount or profit by means of a credit or other valuable consideration in connection with the referral of patients to any person, firm, corporation or association, or in connection with the furnishings of medical, surgical or dental care, diagnosis, treatment or service, on the sale, rental, furnishing or supplying of clinical laboratory supplies or services of any kind, drugs, medication, or medical supplies, or any other goods, services or supplies prescribed for medical diagnosis, care or treatment.

FALSE CLAIMS - State

48.80.030. Making false claims, concealing information--Penalty--Exclusions  (1) A person shall not make or present or cause to be made or presented to a health care payer a claim for a health care payment knowing the claim to be false. (2) No person shall knowingly present to a health care payer a claim for a health care payment that falsely represents that the goods or services were medically necessary in accordance with professionally accepted standards. Each claim that violates this subsection shall constitute a separate offense. (3) No person shall knowingly make a false statement or false representation of a material fact to a health care payer for use in determining rights to a health care payment. Each claim that violates this subsection shall constitute a separate violation.

FALSE CLAIMS – cont.4) No person shall conceal the occurrence of any event affecting his or her initial or continued right under a contract, certificate, or policy of insurance to have a payment made by a health care payer for a specified health care service. A person shall not conceal or fail to disclose any information with intent to obtain a health care payment to which the person or any other person is not entitled, or to obtain a health care payment in an amount greater than that which the person or any other person is entitled. (5) No provider shall willfully collect or attempt to collect an amount from an insured knowing that to be in violation of an agreement or contract with a health care payor to which the provider is a party. (6) A person who violates this section is guilty of a class C felony punishable under chapter 9A.20 RCW. (7) This section does not apply to statements made on an application for coverage under a contract or certificate of health care coverage issued by an insurer, health care service contractor, health maintenance organization, or other legal entity which is self-insured and providing health care benefits to its employees.

PRIVACY, SECURITY & ACCESS

HIPAA covered entity status governs HIPAA vs. UHCIA

UHCIA has parallel features but less complex HIPAA has both privacy aspects and

electronic security HITECH amendments to HIPAA increase

security breach sanctions but also place direct HIPAA responsibility on Business Associates

HIPAA-HITECH COMPLIANCE

Encrypt your computers & email containing PHI

Conduct a HIPAA risk assessment review Create training for staff on HIPAA Review data safeguards for your PHI Create and distribute your Notice of Privacy

Practices Have you made provisions for reporting any

breach of HIPAA?

SEXUAL MISCONDUCT

A healthcare provider shall not engage, or attempt to engage, in sexual misconduct with a current patient, client, or key party, inside or outside the health care setting.

KEY PARTY

'Key party' means immediate family members and others who would be reasonably expected to play a significant role in the health care decisions of the patient or client and includes, but is not limited to, the spouse, domestic partner, sibling, parent, child, guardian and person authorized to make health care decisions of the patient or client.

DEFINITIONS

Twenty one separate offenses which constitute sexual misconduct (WAC 246-16-100(1)

» Suggesting or discussing the possibility of a dating, sexual or romantic relationship after the professional relationship ends.

» Terminating a professional relationship for the purpose of pursuing a relationship.

» Any behavior, gestures, or expressions that may reasonably be interpreted a seductive or sexual.

TERMINATION

The healthcare provider shall not engage, or attempt to engage, in the activities listed in (1) of this section with a former patient, client or key party within two years after the provider-patient/client relationship ends.

POST TWO YEARS?

After the two year period, a health care provider shall not engage in the (1) activities, IF

» There is a significant likelihood that the patient, client or key party will seek or require additional services from the provider.

» There is an imbalance of power, influence, opportunity and/or special knowledge of the professional relationship.

DEFENSE

'Legitimate health care purpose' means activities for examination, diagnosis, treatment, and personal care of patients or clients, including palliative care, as consistent with community standards of practice for the profession. The activity must be within the scope of practice of the health care provider.

MANDATORY REPORTING

There has always been some reporting requirements, particularly courts and insurance companies.

In May 2008, the reporting requirements were broadened to require licensees to report on other licensees and to self report their own defined acts or omissions.

EMPLOYMENT CHALLENGES

Employee vs. Independent Contractor

Whether the staff person is an employee or an independent contractor is determined in large part as a matter of employer control of work, finances and behaviors. What your employer designates you is not the determining factor – it is control.

CONSEQUENCES OF MISCHARACTERIZATION

Employer tax penalties and fines from IRS, ESD & DOLI

Labor & Industries imposition of liability upon employer for not insuring workers

Worker vulnerability to unfunded tax liabilities and injury

Employer liability to employee for insufficient payment of minimum wage, if any.

QUESTIONS

John C. PeickPeick|Boyer Law Group, P.S.

3633 136th Pl. SE #205Bellevue, Washington 98006

425-462-0660

Visit www.peicklaw.com