Last year the United States Department of Justice (DOJ) reported recovering more than $5.6 billion in settlements and judgments related to cases involving fraud and false claims against the government.  The majority of the cases involved the healthcare industry and included situations wherein actors were found to have entered into unlawful arrangements that compromised good medical care for profit.

In the last four months, several more of these cases have come to light and the DOJ has filed complaints accordingly.  Most recently, it was alleged that a group of  business owners and medical professionals out of Texas violated several federal laws through the vehicle of a Management Service Organization (MSO).  According to the DOJ Press Release, several physicians, laboratories, and hospitals conspired to induce referrals to hospitals for laboratory testing.  MSOs were used to make payments to referring doctors; disguising them as investment returns when they were actually compensation in exchange for referrals.  As a result, the DOJ alleged that the named individuals have violated the False Claims Act (FCA), the Anti-Kickback Statute (AKS), and the Federal Physician Self Referral Law known colloquially as the Stark Law.

This recent filing, along with a history of similar events, is a reminder to all healthcare practitioners that there are both state and federal regulations that must be considered before entering into MSO relationships.  While such a relationship often provides valuable non-clinical services and administrative support to medical practices, unless structured carefully, such an arrangement can trigger Corporate Practice of Medicine prohibitions.  If a MSO relationship appears to be affecting the provision of good medical care, healthcare professionals could find themselves embroiled with a number of serious consequences.

If you have questions about whether to use a MSO to achieve your business goals, or if you existing relationship with a MSO is compliant with current state and federal law, Contact Us.

The post United States Department of Justice continues its crusade against Healthcare Fraud: A highlight on MSO relationships appeared first on Campanella Law Office.

Last month, the Office of the Inspector General (OIG) published a “Notice of Proposed Rulemaking.”  The proposed rule, entitled “Revisions to the Safe Harbors Under the Anti-Kickback Statute and Civil Monetary Penalty Rules Regarding Beneficiary Inducements,” (84 FR 55694) is part of the Department of Health and Human Services’ “Regulatory Sprint to Coordinated Care,” which seeks to encourage movement towards a value-based healthcare system and promote the coordination of care among various health care providers and settings.

The proposed rule recognizes that the current language of the Federal Anti-Kickback statute, 42 U.S.C. §1320a-7b(b), and the Civil Monetary Penalty (CMP) Rules Regarding Beneficiary Inducement, 42 U.S.C. §1320a-7a(a)(5), requires modification in order to address the rapidly changing climate of the healthcare practice.  An example of this is the proposed incorporation of language which recognizes the use of cybersecurity technology and language relating to electronic health records.

The public comment period for the proposed rule is currently open.  If you wish to submit a formal comment you may do so through December 31, 2019.  As always, Campanella Law Office, LLC will be monitoring the process and will issue an update after the comment period has closed.

If you are interested in more information about the proposed rule you can review the Department of Health and Human Services’ Fact Sheet.  You can also find the proposed rule and a link to submit a formal comment on the Federal Register’s website.

The post Proposed Rule Open For Public Comment through December 31, 2019: One Step Forward In the Department of Health and Human Services’ Regulatory Sprint to Coordinated Care appeared first on Campanella Law Office.