NAVIGATING THE HEALTHCARE MINEFIELD John C. Peick, J.D. PEICK | BOYER LAW GROUP, P.S. Bellevue, Washington

INTERFACES

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

COMMON PROVIDER CONTRACT MISTAKES l Billing for non-credentialed providers l Billing for unbundled services l Billing wrong codes for services l Billing higher time codes without supporting documentation l Collecting discount balances from patients for covered services (P.I.)

COMMON PROVIDER CONTRACT MISTAKES(cont) l Billing services under inappropriate provider l No or little documentation of services l No or little documentation of medical necessity l No or little documentation of reasonableness

GROUP PRACTICES Misery Loves Company OR The More the Merrier

What is Group Practice l “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. l Group Practice may be single discipline or multidisciplinary.

Legal Structure of Group Practices l Sole Proprietor with Associates l Partners (with or without Associates) l Shareholders in Professional Service Corporation (with or without Associates) l Members in Professional Limited Liability Company (with or without Associates) l 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 l Increased Economies of Scale in Use of Equipment & Technology l Reduces Per Provider Staff Overhead l Increased Marketing Capabilities & Resources l Generates Stable Income Stream l Enables Practice to Maximize Utilization of Associates

Disadvantages of Group Practice l Requires Uniformity in Staff Procedures & Billing l Individual Practice Variations Will Come Under Scrutiny for E&O Exposure l Increased Financial Accountability l A General Sense of Loss of Control l Requires Team Player Skills

MultiDisciplinary Group Practice Advantages l Same economies of scale as single discipline groups. l Breadth of healthcare expertise is a marketing strength to consumers - One Stop Shopping l Marketing advantage to MCOs l Opportunity to deliver more comprehensive health care solutions with better patient outcomes

Traps for the Unwary l Failure to incorporate as professional services corporation or PLLC l Failure to understand scope of practice limitations l Failure to delineate services provided l Failure to bill separately l 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 l Professional Discipline l Criminal Investigation l Insurance Company Audits l Civil Claims by Patients

FEDERAL HEALTHCARE CRIMINAL LAWS l Healthcare Fraud under HIPAA l False Statements relating to Healthcare l Medicare Patient Protection Act l Anti-Kickback & Self- Referral (Stark I & II) l False Claims Act l Mail & Wire Fraud l Obstruction of Justice

STATE HEALTHCARE RELATED LAWS l Anti-Rebating (Ch RCW) l Healthcare Insurance Claim Trafficking (Ch A RCW ) l False Insurance Claims (RCW ) l Healthcare Fraud (Ch RCW) l Criminal Profiteering (RCW 9A )

STATE LAWS (cont.) l Healthcare Disciplinary Act (RCW ) l Self-Referral Prohibitions (DSHS) l Medical Records Privacy (Ch RCW)

REBATING - State RCW (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 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 l HIPAA covered entity status governs HIPAA vs. UHCIA l UHCIA has parallel features but less complex l HIPAA has both privacy aspects and electronic security l HITECH amendments to HIPAA increase security breach sanctions but also place direct HIPAA responsibility on Business Associates

HIPAA-HITECH COMPLIANCE l Encrypt your computers & containing PHI l Conduct a HIPAA risk assessment review l Create training for staff on HIPAA l Review data safeguards for your PHI l Create and distribute your Notice of Privacy Practices l 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 (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 l There has always been some reporting requirements, particularly courts and insurance companies. l 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 l Employer tax penalties and fines from IRS, ESD & DOLI l Labor & Industries imposition of liability upon employer for not insuring workers l Worker vulnerability to unfunded tax liabilities and injury l Employer liability to employee for insufficient payment of minimum wage, if any.

QUESTIONS John C. Peick Peick|Boyer Law Group, P.S th Pl. SE #205 Bellevue, Washington Visit