(Excerpted from Medical Economics, October 6, 2006)
Everyone is aware of the risks related to medical malpractice, but what about the many other legal landmines that could impact your practice and your finances?
As the medical industry pursues strategies to increase profitability, physicians are adding ancillary services, merging/acquiring/integrating with other practices, recruiting "star" players for the team and forming joint ventures with hospitals. Although these strategies have the potential for financial gain, there are also risks and exposures as well.
Some of the landmines associated with these efforts stem from:
1. The Stark Self-Referral Law
2. The Federal False Claims Acts
3. Federal Antitrust and/or Competition Laws
Here are some thoughts and safeguards you should consider:
Mergers
1. Doctors may need to change their individual styles for the sake of the group.
2. Practice integration cannot be in name only (otherwise it is little more than independent practices engaged in "per se price fixing".)
3. Under the False Claims Act, each group member is responsible for the actions of every other group member.
4. Consider clinical integration as a way for independent practices to collaborate.
5. Doctors are responsible for all claims that go out under their names.
6. Leveraging the volume of the combined practice with hospitals can create a real Stark and anti-kickback risk.
Hospital Ventures
1. Get you attorney involved earlier, too often they are only called in at the last minute to review months of prior work.
2. Seek expert outside advice and counsel. Make sure your attorneys and consultants understand, and have experience with, Stark and other health laws.
3. Listen to your attorney. You are paying for his advice; don't try to "sell" him on how good the deal is.
4. Be careful in word and print. How you talk about a deal and what you write about a deal can provide ammunition for later litigation.
5. Watch those e-mails. Informality seems to rule the Internet. However, in court, e-mail jests and comments can create serious problems.
6. Be careful. If you're planning to "fly under the radar" and cut some corners, remember that the radar goes all the way to the ground.
Questions to consider about any venture:
1. Will it cost government payers more money than others?
2. What impact will it have on utilization?
3. Will it improve quality?
4. What impact will it have on access to care?
5. What will the effect be on competition?
6. What will be the effect on patients' freedom of choice?
7. Will it create conflicts of interest?
On a final note, regarding the False Claims Act, violations relate to billing for unnecessary services, upcoding, bundling, unbundling and other schemes to defraud the government. Most doctors operate with integrity and such actions are never considered. However, problems can arise when billing is turned over to consultants who promise to boost revenue by capitalizing on "missed revenue opportunities". At that point, a physician can lose control over what's going on in their practice.
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