The audio portion of the conference may be accessed via the telephone or by using your computer's speakers. Please refer to the instructions emailed to registrants for additional information. If you have any questions, please contact Customer Service at 1-800-926-7926 ext. 10. Presenting a live 90-minute webinar with interactive Q&A Telemedicine Requirements for Licensing, Scope of Practice and Reimbursement Overcoming Multistate Regulatory Hurdles for Healthcare Providers and Facilities Today’s faculty features: 1pm Eastern | 12pm Central | 11am Mountain | 10am Pacific TUESDAY, NOVEMBER 21, 2017 Joseph P. McMenamin, Principal, McMenamin Law Offices, Richmond, Va. René Y. Quashie, Member, Cozen O'Connor, Washington, D.C. Richard K. Rifenbark, Principal, Polsinelli, Los Angeles
Transcript
The audio portion of the conference may be accessed via the telephone or by using your computer's
speakers. Please refer to the instructions emailed to registrants for additional information. If you
have any questions, please contact Customer Service at 1-800-926-7926 ext. 10.
Presenting a live 90-minute webinar with interactive Q&A
Telemedicine Requirements for Licensing,
Scope of Practice and Reimbursement Overcoming Multistate Regulatory Hurdles for Healthcare Providers and Facilities
Defining the practice of medicine: state law issue
Holding oneself out as a doctor to the public
Charging for medical services
Providing a medical consult
Issuing orders (labs, imaging studies)
Making a diagnosis
Recommending treatment
Writing prescriptions
Performing treatments/surgery
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Telemedicine and Licensing
■ Licensure is States’ primary means of regulating providers
■ MD offering care via telemedicine may be subject to licensure rules of:
■ The state in which the patient is physically located at the time of the consult;
■ The state where the physician is located/licensed
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Telemedicine and Licensing, 2
■ Received wisdom: Governing law is that of patient’s state
Some states: law or guidance
Others: include diagnosing or treating through “electronic or other means” in definition of the practice of medicine
Others: silent
An opportunity to challenge the received wisdom?
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Challenging Convention D radiologist interpreted images sent from Berks County,
Pa. in Philadelphia, so venue proper there
Wentzel v. Cammarano, 2017 Pa. Super. 223
Care was provided in Houston, where lab located, and to
which specimens were shipped, not in La., where the
patients were and where samples were collected
Quest Diagnostics Clinical Labs., Inc. v. Barfield, No. 2015-
0926 (La. App. 1 Cir. 9/9/16)
Medicare place of service codes: telemedical care is
provided at the health care professional’s site
Apportioning unrelated business income of tax-exempt
hospitals providing distance care: provider’s location is a
relevant consideration
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Physician Licensing
Exceptions
Consultation
• Unlicensed MD may consult peer to peer with MD licensed in the state
• Available in most states; significant variances in scope
• So, requires state-by-state analysis
Bordering State
• MD licensed in bordering state may practice in state
• A few states only
Special License or
Registration
• Abbreviated license or registration for telemedicine-only care
• Offered in several states
Follow-Up Care
• MD may provide follow-up care to patient (post-op, e.g.)
Endorsement
• Physician licensed in another state can, on that basis, more quickly obtain in-state license
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Consultation Exception ■ MD unlicensed in state may offer consults to MDs licensed
there
■ Peer-to-peer: local MD retains control of dx, tx
■ Unlike consultant, interacts with patient
■ State board retains control of its licensee
■ Example: Arizona
− “This [licensing statute] does not apply to… (1) A doctor of medicine residing in another jurisdiction who is authorized to practice medicine in that jurisdiction, if the doctor engages in actual single or infrequent consultation with a doctor of medicine licensed in this state and if the consultation regards a specific patient or patients.” (emphasis added)
− Ariz. Rev. Stat. § 32-1421
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Consultation Exception, 2
■ Highly variable:
− Frequency of consults
− Free v. for compensation
− In-state office or location to meet
− Primary vs. secondary diagnosis
− Contractual arrangement or regular contacts
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Bordering State Exception ■ Out-of-state physician licensed in a bordering state
■ Example: Maryland
− “Subject to the rules, regulations, and orders of the Board, the following individuals may practice medicine without a license… A physician who resides in and is authorized to practice medicine by any state adjoining this State and whose practice extends into this State, if:
(i) The physician does not have an office or other regularly appointed place in this State to meet patients; and
(ii) The same privileges are extended to licensed physicians of this State by the adjoining state.”
Md. Health Occ. Code § 14-302 (emphasis added)
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Special Telehealth
License ■ Abbreviated license or registration for telemedicine-only care
provided to state residents
■ Nine states offer special telehealth licenses
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Special Telehealth License, 2 ■ Example: Minnesota
− “(a) A physician not licensed to practice medicine in this state may provide medical services to a patient located in this state through interstate telemedicine if the following conditions are met:
(1) the physician is licensed without restriction to practice medicine in the state from which the physician provides telemedicine services;
(2) the physician has not had a license to practice medicine revoked or restricted in any state or jurisdiction;
(3) the physician does not open an office in this state, does not meet with patients in this state, and does not receive calls in this state from patients; and
(4) the physician annually registers with the board, on a form provided by the board.”
Minn. Stat. Ann. § 147.032 (emphasis added)
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Follow-Up Care Exception
MD may provide follow-up care (post-op, e.g.)
Example: Indiana
“In addition to the exceptions described in section 2 [IC 25-22.5-1-2] of this chapter, a nonresident physician who is located outside Indiana does not practice medicine or osteopathy in Indiana by providing … treatment services to a patient in Indiana following medical care originally provided to the patient while outside Indiana.”
− Ind. Code Ann. § 25-22.5-1-1.1 (emphasis added)
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Endorsement
■ Based on his out-of-state credentials, physician licensed elsewhere can obtain in-state license faster
■ Example: New Mexico − “The board may grant a license by endorsement to an
applicant who: (1) has graduated from an accredited U.S. or Canadian medical school; (2) is board certified in a specialty recognized by the American Board of Medical Specialties; (3) has been a licensed physician in the U.S. or Canada and has practiced medicine in the U.S. or Canada immediately preceding the application for at least three years; (4) holds an unrestricted license in another state or Canada; and (5) was not the subject of a disciplinary action in a state or province.” − N.M. Stat. Ann. § 61-6-13 (emphasis added)
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Licensing Compacts
■ Interstate Medical License Compact
■ Nurse Licensure Compact and APRN Compact
■ Psychology Interjurisdictional Compact
■ Physical Therapy Licensure Compact
■ No others on the horizon at present
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Interstate Medical License Compact
■ Additional licensure approach for physicians in Compact-participating states
■ Physician licensure portability and practice of cross-border services
■ Complements existing licensing and regulatory authority of state medical boards ■ Must still become fully licensed in each state
■ Must still pay fees
■ Twenty-two states have joined (as of 11/17)
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Nurse Licensure Compact
■ Permits nurse to practice in own state and other Compact states
■ If a Compact state is the primary state of residence, the license automatically becomes a Compact/multistate license
■ 25 states have adopted the Compact to date
■ National Council for State Boards of Nursing approved APRN Compact (5/4/15)
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Psychology
Interjurisdictional Compact Association of State and Provincial Psychology Boards approved
(2/15)
Goal: facilitate telehealth and temporary, in-person, face-to-face [not defined] practice of psychology across state lines
Became operative after seven states adopted the Compact
At present, no provision for Provinces
Three states have adopted to date: Arizona, Utah, and Nevada
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Physical Therapy
Licensure Compact
From Federation of State Boards of Physical Therapy
Enacted 5/15/17
Purpose: increase access to PT services by reducing regulatory barriers to cross–state practice
To date, fourteen states have adopted the Compact
• Public comment has closed, rules were voted upon on 11/5/17
• Results not publicly available as of 14 Nov. 2017
• Compact expected to be up and running in early ‘18
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Federation of State Medical
Boards Telemedicine Policy
■ Adopted in 2014
■ Provides TM guidance to state medical boards
■ Topics:
− Physician licensure
− Establishment of physician-patient relationship
− Evaluation and treatment of patient
− Informed consent
− Continuity of care
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Federation of State Medical
Boards Telemedicine Policy, 2
■ Topics, cont’d
− Medical records
− Privacy and security
− Disclosures and functionality of online services
− Prescribing
− Referrals for emergency services
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Telehealth Informed Consent
30 states expressly require informed consent for telehealth services
Not necessarily applicable to all telehealth; may apply to Medicaid only or to identified specialties
■ Example: California
■ “Prior to the delivery of health care via telehealth, the health care provider initiating the use of telehealth shall inform the patient about the use of telehealth and obtain verbal or written consent from the patient for the use of telehealth as an acceptable mode of delivering health care services and public health. The consent shall be documented.”
■ Cal. Bus. & Prof. Code 2290.5(b) (emphasis added)
■ Future?
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Telehealth Malpractice
Considerations ■ Few claims
■ Many are not med mal at all, but 42 USC 1983 cases
■ Standard negligence analysis
■ This renegade’s view: Beware clinical practice guidelines
■ Many states: Standard is the same as that for in-person care
■ With videoconferencing, practitioner may inspect and (sometimes) auscultate;
■ can neither percuss nor palpate
■ Rx: Decline to offer telemedicine where full PE needed
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Telemedicine Credentialing ■ CMS Conditions of Participation for Hospitals
− Hospital must have a credentialing and privileging process for practitioners providing services to its patients
− Includes those who provide services via telehealth
− CMS permits hospital receiving telehealth services to rely on the privileging and credentialing decisions of hospital or entity providing them, if certain requirements are met
− Hospital must have a written agreement with the distant-site hospital/telehealth entity
A number of states prohibit the “corporate practice of medicine” (CPOM) to varying degrees
The CPOM is generally defined as a prohibition on the operation of a medical practice, or the employment of physicians or other licensed professionals, by entities that are not themselves licensed to practice medicine
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Corporate Practice of Medicine
Rationale for CPOM:
– Protects independent judgment of physicians
– Limits commercialization of the profession
– Unlicensed corporate entities are not subject to the same professional standards and regulatory control
Most states have some form of the CPOM doctrine, but key states include CA, TX, SC, NY, TN, WA, IL
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Corporate Practice of Medicine
Sources of the CPOM doctrine include:
State statutes and regulations
– Example: Cal. Bus. & Prof. Code § 2400: “Corporations and other artificial legal entities shall have no professional rights, privileges, or powers….”
• Cal. Bus. & Prof. Code § 2052: "Any person who practices or attempts to practice, or who holds himself or herself out as practicing...[medicine] without having at the time of so doing a valid, unrevoked, or unsuspended certificate...is guilty of a public offense.”
– Example: Colo. Rev. Stat. Ann. § 12-36-134(7)(a): “Corporations shall not practice medicine.”
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Corporate Practice of Medicine
Case law
– Example: State Farm Mutual Automobile Insurance Co. v. Mallela, 175 F. Supp. 2d 401, 414 (E.D. N.Y. 2001): “[W]hen a professional health services corporation is owned by an unlicensed individual, ‘there is a danger that the doctor, knowing that he or she had to split his or her fees with one who did not render medical services, might be hesitant to provide proper services to a patient.’” (internal citation omitted)
– Example: Garcia v. Texas State Board of Medical Examiners, 384 F. Supp. 434, 437 (W.D. Tex. 1974): “Texas courts have held that when a corporation employs a licensed physician to treat patients and itself receives a fee, the corporation is unlawfully engaged in the practice of medicine.”
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Corporate Practice of Medicine
Attorney General opinions
– Example: N.C. Atty. Gen. Op. (Sept. 3, 1999): A dental practice management company would be deemed to be practicing dentistry if payment to the management company were based on the revenues of the dental practice
– Example: Mich. Atty. Gen. Op. 6592 (July 10, 1989): A domestic corporation formed under the Business Corporation Act may not engage in activities which may only be performed by one of the learned professions
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Corporate Practice of Medicine
Medical Board guidance – Example: The Medical Board of California
• The CA Medical Board views the following as health care decisions that should be made by a physician:
– Determining what diagnostic tests are appropriate for a particular condition
– Determining the need for referrals to, or consultation with, another physician/specialist
– Responsibility for the ultimate overall care of the patient, including treatment options available to the patient
– Determining how many patients a physician must see in a given period of time or how many hours a physician must work available to the patient
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Corporate Practice of Medicine
Medical Board guidance (continued) – Example: The Medical Board of California
• The following “business” or “management” decisions should be made by a licensed physician:
– Ownership is an indicator of control of a patient's medical records, including determining the contents thereof, and should be retained by a California-licensed physician
– Selection, hiring/firing (as it relates to clinical competency or proficiency) of physicians, allied health staff and medical assistants
– Setting the parameters under which the physician will enter into contractual relationships with third-party payers.
– Decisions regarding coding and billing procedures for patient care services
– Approving of the selection of medical equipment and medical supplies for the medical practice
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Corporate Practice of Medicine
Medical Board guidance (continued) – Example: The Medical Board of California
• The following structures are prohibited: – Non-physicians owning or operating a business that
offers patient evaluation, diagnosis, care and/or treatment
– Physician(s) operating a medical practice as a limited liability company, a limited liability partnership, or a general corporation
– MSOs arranging for, advertising, or providing medical services rather than only providing administrative staff and services for a physician's medical practice
– A physician acting as "medical director" when the physician does not own the practice
Penalties for violating the CPOM doctrine include:
– Enforcement action by state AG
– Enforcement action by applicable professional board
– Debarment of the professional
– Civil, criminal penalties, injunctive relief
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Corporate Practice of Medicine
How do telehealth arrangements implicate the CPOM?
– Non physician investment in medical practices
– Multistate arrangements
– Management company services and compensation
– Employment of licensed professionals by non-professional entities
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Corporate Practice of Medicine
What should I do to evaluate whether I have a CPOM issue?
– Where are you operating? One state or multiple states?
– Determine whether you are operating in a state (or states) with a CPOM doctrine. If yes, do any exceptions apply?
– Evaluate who is providing the medical care (MDs, PAs, MFTs, NPs)
– Who owns the entity that employs or contracts with the licensed professionals?
– Who manages the medical practice? How is that entity
paid?
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Anti-Kickback Laws
Federal Anti-Kickback Statute, 42 U.S.C. § 1320a-7b(b)
Federal criminal statute, also civil penalties
Intent-based statute
Covers all types of arrangements & individuals
Safe harbors (provide immunity for certain arrangements; not required)
OIG Advisory Opinions
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Anti-Kickback Laws
A violation requires three elements:
– “Remuneration,” which means anything of value, in cash or in kind
– The remuneration must be made “knowingly and willfully”
– The remuneration must be made with intent to induce referrals or business; according to certain federal courts, a violation may be found if only one purpose of the remuneration is to induce referrals, even if there are also legitimate reasons for the payment
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Anti-Kickback Laws
Liability under the Anti-Kickback Statute applies to the offeror and recipient of the kickback
June 2015 OIG Fraud Alert: “Physician Compensation Arrangements May Result in Significant Liability”
– OIG cautioned physicians to “…carefully consider the terms and conditions of medical directorships and other compensation arrangements before entering into them”
– OIG Adv. Op. 99-14 (rural telehealth arrangement funded with federal grants)
– Advisory opinions provide certainty for parties, but:
• All material facts must be presented
• Only apply to parties who submitted the opinion request
• Time consuming process
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Anti-Kickback Laws
Watch out for state anti-kickback statutes and fee splitting prohibitions!
Some form of state anti-kickback law and/or fee splitting prohibition exists in most states
Types of state anti-kickback laws:
– All payer
– Insurance
– Medicaid
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Anti-Kickback Laws
Example: Cal. Bus.& Prof. Code § 650: “…. the offer, delivery, receipt, or acceptance by any person licensed
under this division or the Chiropractic Initiative Act of any rebate, refund, commission, preference, patronage dividend, discount, or other consideration, whether in the form of money or otherwise, as compensation or inducement for referring patients, clients, or customers to any person, irrespective of any membership, proprietary interest, or coownership in or with any person to whom these patients, clients, or customers are referred is unlawful.”
Important exception: The payment or receipt of consideration for services other than the referral of patients which is based on a percentage of gross revenue or similar type of contractual arrangement shall not be unlawful if the consideration is commensurate with the value of the services furnished or with the fair rental value of any premises or equipment leased or provided by the recipient to the payer
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Anti-Kickback Laws
Example: 225 Ill. Comp. Stat. 60/22.2
“A licensee under this Act may not directly or indirectly divide, share or split any professional fee or other form of compensation for professional services with anyone in exchange for a referral or otherwise, other than as provided in this Section 22.2”
Includes payments to a company for the marketing or management of the medical practice
Exception exists for FMV payments to billing company
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Anti-Kickback Laws
Example: Epic Medical Management v. Paquette,
244 Cal.App.4th 504 (2015)
– Dispute over MSO compensation and services
– Services provided by MSO:
• Lease office space to physician
• Lease all equipment to physician
• Provide support services
• Provide non-physician personnel
• Establish and implement a marketing plan
• Conduct billing and collections
• Perform accounting services
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Anti-Kickback Laws
MSO compensation
– 50% of office medical services
– 25% of surgical services
– 75% of pharmaceutical expenses
Physician argued that because some of the fees were for marketing services, the payments were illegal kickbacks for referred patients (and the MSO did refer patients to the practice)
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Anti-Kickback Laws
Holdings
– No state anti-kickback statute violation: No evidence that the amount the MSO received was for referrals
– No CPOM violation: the Court found a strict delineation between non-medical services provided by the MSO and medical services provided by the practice
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Anti-Kickback Laws
How do telehealth arrangements implicate federal or state anti-kickback and fee-splitting laws?
– Payments for referrals
– Payments for services that are above-FMV
– Payments among providers
What should I do to determine if I have an anti-kickback statute or fee-splitting issue with my telehealth arrangement?
– Review financial arrangements with referral sources
– Do the states in which you operate have state anti-kickback laws or fee-splitting statutes?
– Evaluate whether financial arrangements fall within safe harbors
– Critically review the purpose of the payments
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State Insurance Laws
Some telehealth models can implicate state health insurance laws (e.g., subscription models)
For example, California’s Knox-Keene Health Care Service Plan Act of 1975 regulates “health care service plans,” which are generally defined as:
– “Any person who undertakes to arrange for the provision of health care services to subscribers or enrollees, or to pay for or to reimburse any part of the cost for those services, in return for a prepaid or periodic charge paid by or on behalf of the subscribers or enrollees.” Cal. Health & Safety Code § 1345(f)(1).
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State Insurance Laws
How do telehealth arrangements implicate state insurance laws?
– Payment structures can sometimes implicate insurance statutes if the provider is “at risk” for payment
– For example, a subscription model in which a patient pays $100 per month for all the telehealth consults he/she needs
What can I do to evaluate whether my telehealth arrangement implicates state insurance laws?
– Review payment structures
– What services are being provided for the payments?
