Holland & Hart Healthcare Law Blog

GENERAL COUNSEL LIABILITY IN HEALTH CARE ETHICS AND COMPLIANCE OVERSIGHT.

It is not easy being General Counsel for a health care system and growing more difficult with the advent of Corporate Integrity Agreement and Public Securities Obligations.  It is also dangerous and unwise to accept responsibility for Chief Compliance Officer as well as Chief Legal Officer. The ongoing travails of Christi R. Sulzbach, Esq. former Executive Vice President and General Counsel and Chief Compliance Officer of Tenet Healthcare Corporation is a case in point. Ms.Sulzbach, who resigned her position at Tenet in 2003, settled a case brought against her by the Securities Exchange Commission. arising out of a Tenet scheme to defraud Medicare by over reporting its costs so as to increase Medicare payments under its enhanced payment program for “Outlier” patient conditions.  Tenet settled for 10 Million Dollars several years ago. 

THE INTERNET, MYSPACE, MEDICAL PRIVACY AND FAMILY FEUDS.

        Two recent and unrelated cases this month involved the unlawful access to private medical records and the posting of them on the internet on MySpace in order to inflict pain in the prosecution of family feuds. Both feuds involved Asian families. In Hawaii, Rhonda Wong-Fernandez, a 22 year old mother of three small children, plead guilty to a felony charge of unauthorized use of a computer to access confidential records. Ms. Wong Fernandez was a friend of the victim’s sister in law who was feuding with the victim.  She obtained access to the medical records of the victim who was suffering from HIV at the Straub clinic and published them three times on MySpace. At one time she stated that “I hope she dies.” The victim did die in April.  Although the prosecutor requested a one month jail sentence, the judge disagreed and sentenced her to one year in jail, five years probation and 200 hours of community service. The judge ordered her taken into custody immediately and refused a request to defer the start of her sentence until she could provide for her 5 month old child.

     

TWENTY-FIVE STEPS IN DEFENSE OF RAC AUDITS.

Recovery Audit Contractors (RACs) are in the process of saddling up for the nationwide roll out of their Medicare payment recoupment mission. Here are twenty-five recommended proactive steps to circle the wagons and defend the RAC threat.

1. Develop and implement a written audit defense plan- the government bounty hunters are coming your way and they will be looking for the  low lying fruit.

2. Select an audit team or responsible persons depending upon the size of your organization. Including if appropriate internal audit, billing and coding, medical records, risk management and the CFO.

3. Assign specific team member responsibilities in dealing with anticipated audit issues.

4. Consider running an internal pre-audit to identify vulnerabilities such as “medical necessity” and “duplication of services.”

RAC AUDITS AND NEW FEDERAL FALSE CLAIMS ACT EXPOSURE.UNDER THE FRAUD ENFORCEMENT RECOVERY ACT OF 2009 (“FERA”).

The federal squeeze of health care providers is underway. Federal Medicare recovery “bounty hunters,” the Recovery Audit Contractors (“RAC”), are marshalling resources for the anticipated, algorithm primed, data mining hunt for Medicare overpayments from hospitals, physicians, DME companies, hospices and other providers, which is likely to bloom in the second half of this year. Those that attempt to mislead the government or its computer toting agents in order to limit the harvest are facing additional potential exposure under the Federal False Claims Act, 31 U.S.C. §3729-3733 (“FCA”).

INTERNET MEDICINE: PART VII – PUBLIC, PROPRIETARY AND PRIVACY TENSIONS IN MEDICAL DEVICES.

The front page of the New York Times today carried a story by Pam Belluck on a hospital’s promotional webcast of Shila Renee Mullins’s brain surgery to extract a malignant tumor, which raised conflicting opinion is about the wisdom, benefit and ethics of the public dissemination of personal medical information, even if consensual, and the public access to dramatic interventional medical procedures. Some hospitals are featuring twittering during operations in order to apprise relatives and others of the progress of thee procedure in real time.

HCQIA IMMUNITY CAN APPLY TO PEER REVIEW OF PRIVATE PHYSICIAN CONDUCT.

In the recent case of Moore,, MD v. Williamsburg Regional Hospital et al., No. 07-1966 (4th Cir. 2009), a federal court of appeals addressed the issue of how far a hospital peer review can go in considering the private conduct of a physician in suspending his or her hospital privileges.  The physician, Dr. Moore is a general surgeon who performs surgery on both adults and children in his practice.  Dr. Moore’s private left spilled over into his professional life in a tragic and unresolved way. 

Exclusive Anethesia Arrangement Fails Personal Services Exemption Under Stark.

Normally, anesthesia services contracts do not receive a lot of scrutiny with respect to Stark or Anti-kickback Statute ("AKS") compliance. Recently, the federal 3rd Circuit Court of Appeals had a chance to review and reverse a summary judgment granted in favor of a hospital and its anesthesia providers who claimed that they were protected by the "personal services" exemption from Stark and the AKS. The Plaintiff in the Qui Tam lawsuit, United States  ex. rel. Kosenske v. Carlisle HMA, Inc., 3rd. Cir.,No. 07-4616, 2009), was a member of the anesthesia group which entered into an exclusive contract with the Carlisle Hospital for anesthesia services. The hospital provided free space and services to the anesthesia group, which is not an uncommon practice because that is generally considered part of the "arms length"negotiation price for the anesthesia services.

15 Ways to Eliminate “Trust”In Health Care Organizations.

Trust" can be defined as confidence in the integrity, ability, character and truth of a person or thing. It is a dangerous commodity in a health care setting. Remember as the poet said,

As contagion of sickness makes sickness, contagion of trust makes trust.

Marianne Moore, In Distrust of Merits (1941) Trust is a frightful tool in the hands of the wrong party bent on influencing events.

A small dust of earth that walks so arrogantly, trust begets power and faith is an affectionate thing.

Id

. Trust can be contained and even eliminated in any labor intensive organization by following a few simple rules. Here they are:

1. Keep your focus on your self interest rather than diluting it upon your organization and its members. There can be only one number one.

2. Always claim every success whether it belongs to you or not. Everybody loves a winner.

3. Chase the short-term goals that generate immediate returns. After all, you may not be here tomorrow and that might be a good thing.

4. Promise them anything whether you can deliver or not. Memories are short and it’s impolite to say no.

5. Maintain a firm hand in command and control. Everybody needs to know who is in charge of their future and fate.

6. Accept no responsibility for failure. Nobody likes a loser. Make sure that it is adequately punished to stomp out unnecessary risk.

7. Carefully limit the authority of those around you so that they know that they must respond to the strings that you pull.

8. Divide and conquer by identifying and rewarding your favorite people. Loyalty must have its perquisites and to the victor belong the spoils.

9. Punish those that demonstrate free thinking and independence. They need to get on the same page as the rest of the team. That kind of conduct can be disruptive.

10. Keep hidden agendas hidden until you need them. Transparency gets in the way of political pragmatism.

11. Announce principles and values for others to follow but provide yourself dispensation because after all you are in charge or on your way up.

12. Ignore or minimize the contributions of the "others" so that they do not get a leg up on "us." Make sure you can identify "them" that are opprosed to "us" so that we can over time squeeze them out of the organization.

13. Keep people on their toes by keeping organizational goals fuzzy and constantly changing, making it more difficult to focus responsibility. You can’t be a target if you are not responsible and your contribution is not measurable.

14. Reaching consensus is a waste of time. Tell people where the organization is going and brook no dissent. Get on the bus or off the boat.

15. Reward mediocrity because it is non-threatening and comfortable. Tie others to failures and punish them quickly to minimize the damage.

Following these prescriptions you will find an effective antidote to the menace of trust in your health care organization. Good luck and God speed.

Colorado Denies Immunity from Physician Peer Review

In Peper v. St. Mary’s Hospital and Medical Center, No. 07CA2491, the Colorado Court of Appeals held that a Colorado hospital and medical stafff physicians who revoked the plaintiff’s hospital privileges without notice or a hearing failed to establish grounds for immunity under the Health Care Quality Improvement Act of 1986.  Dr. Peper is a cardiothoracic surgeon who was appointed and reappointed to the “provisional actual medical staff of St. Mary’s Hospital.”  At about the time of his reappointment, the hospital began a secret review of 19 of Dr. Peper’s cases.  An external reviewer asserted the presence of provisions that suggested the possibility of problems with surgical techniques and/or judgment.

Physician Recruitment: Recruited Doc Bites Group in Arkansas.

Many physician recruitment efforts are three party arrangements where a physician group either solicits a hospital to help support a newly recruited physician or a hospital solicits a group as a place to practice for a new physician recruited by the hospital. Typically in these deals the group agrees to accept the recruit into its practice and to accept a guaranteed income payment from the hospital for a year.  The recruit accepts a salary from the group.  The hospital’s subsidy covers expenses and some level of income for the first year less the production of the recruit.  The recruit is required to remain practicing in the hospital’s market for two or three additional years. The amount of any subsidy is folded into a note which is forgiven by the hospital each year prorate to the fulfillment of the practice requirement.  The recruit and the practice group are jointly and severally liable on the note as it is forgiven.