The founders of an Edinburg hospice and related home health agency have paid $1,847,279.36 to resolve allegations they submitted claims to Medicare that resulted from unlawful referrals. The company offered compensation to physicians who were responsible for a significant majority of their patient referrals. Specifically, they provided physicians with monthly payments pursuant to medical directorship agreements with Allstate and Verge. Those payments were in excess of fair market value for the services the physicians actually provided. They also sold interests in Allstate to five different physicians which ultimately netted them substantial quarterly dividends. They also provided physicians other gifts and benefits, such as travel and tickets to sporting events.
CMS also clarified that if a group has five or fewer physicians, overall profits means the profits from DHS from the entire group; but if a group has more than five physicians, the group may designate a component of at least five physicians to aggregate the profits for the purpose of distribution.
The changes to the Anti-Kickback Statute make it easier to enter into value-based care arrangements, especially if providers take full risk. The exceptions create flexibility in how physicians are compensated. The exceptions don’t require setting compensation in advance, consistency with fair market value or determined in a way that doesn’t take the volume or value of physician referrals into account. But there is a commercial reasonableness standard for pay, and the exceptions apply to both Medicare and non-Medicare beneficiaries.
A value-based arrangement is an arrangement entered into between a value-based enterprise (VBE) and one or more of its participants, or among VBE participants in the same VBE, for the provision of one or more value-based activities for a target patient population. The final rule defines a VBE participant as an individual or entity that […]
A great resource of the a redline versions of the regulations that highlight the changes for the new revisions to Stark and the Anti-Kickback Statute. The documents may be accessed here: Revised Stark Regulations Revised Anti-Kickback Statute Regulations The Federal Register versions of the revised regulations and accompanying commentary may be accessed here: 42 CFR 411 […]
The final rules for changes to the Stark Law and Anti-Kickback Statute (healthcare fraud & abuse laws) have been published and go into effect on January 19, 2020. Of course, health lawyers love this stuff, but it could impact other practice areas too. Transaction attorneys, you already know to be very careful if your transaction […]