Practice formation considerations achieving legal compliance with diverse private medicine models
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PRACTICE FORMATION CONSIDERATIONS: ACHIEVING LEGAL COMPLIANCE WITH DIVERSE PRIVATE MEDICINE MODELS PowerPoint PPT Presentation


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PRACTICE FORMATION CONSIDERATIONS: ACHIEVING LEGAL COMPLIANCE WITH DIVERSE PRIVATE MEDICINE MODELS. James J. Eischen, Jr., Esq. October 2013 Chicago, Illinois. JAMES J. EISCHEN, JR., ESQ. Partner at Higgs, Fletcher & Mack, LLP 26+ years of experience as an attorney in California

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PRACTICE FORMATION CONSIDERATIONS: ACHIEVING LEGAL COMPLIANCE WITH DIVERSE PRIVATE MEDICINE MODELS

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Practice formation considerations achieving legal compliance with diverse private medicine models

PRACTICE FORMATION CONSIDERATIONS:ACHIEVING LEGAL COMPLIANCE WITH DIVERSE PRIVATE MEDICINE MODELS

James J. Eischen, Jr., Esq.

October 2013

Chicago, Illinois

(c) 2013 James J. Eischen, Jr., Esq.


Practice formation considerations achieving legal compliance with diverse private medicine models

JAMES J. EISCHEN, JR., ESQ.

Partner at Higgs, Fletcher & Mack, LLP

26+ years of experience as an attorney in California

Experience in the healthcare field: medical groups, EHR firms, health coaching enterprises and healthcare products.

Graduated from the University of California at Davis School of Law.

Professional Memberships: San Diego County Bar Association Law & Medicine Section, Attorney-Client Relations Committee, State Bar Of California Section Member, AAPP Corporate Secretary

(c) 2013 James J. Eischen, Jr., Esq.


Practice formation considerations achieving legal compliance with diverse private medicine models

WHY MUST U.S. HEALTH CARE EVOLVE?

(c) 2013 James J. Eischen, Jr., Esq.


Why america performs poorly on health measures

WHY AMERICA PERFORMS POORLY ON HEALTH MEASURES

(c) 2013 James J. Eischen, Jr., Esq.


Practice formation considerations achieving legal compliance with diverse private medicine models

(c) 2013 James J. Eischen, Jr., Esq.


Practice formation considerations achieving legal compliance with diverse private medicine models

  • U.S. has a large and widening "mortality gap" among adults over 50 compared with other high-income nations.

  • Two-thirds of the difference in male life expectancy between the U.S. and other countries is due to deaths in that under-50 age category, and one-third of the gap is due to deaths among women under 50.

  • U.S. fares worse in nine health domains: birth outcomes, injuries and homicides, teen pregnancies and sexually transmitted infections, HIV/AIDS, drug-related mortality, obesity and diabetes, heart disease, chronic lung disease, and disability.

  • Areas in which the U.S. is not behind other wealthy countries are cancer screening and mortality, control of high blood pressure and cholesterol, smoking rates, and suicides.

  • Part of the nation's poor ranking attributed to problems with its $2.6 trillion-a-year health care system (the world's most expensive by far). 50 million Americans without health insurance, fewer doctors per capita, less access to primary care and fragmented management of complex chronic diseases.

http://www.npr.org/blogs/health/2013/01/09/168976602/u-s-ranks-below-16-other-rich-countries-in-health-report

(c) 2013 James J. Eischen, Jr., Esq.


Fee for service ffs

FEE FOR SERVICE (FFS)

Does FFS work?

Consensus = NO

(c) 2013 James J. Eischen, Jr., Esq.


Practice formation considerations achieving legal compliance with diverse private medicine models

“The way we pay doctors is profoundly flawed. We need to move rapidly away from fee-for- service and embrace new ways of paying doctors to encourage cost-effective, high quality care.”

http://telemedicinenews.blogspot.com/

(c) 2013 James J. Eischen, Jr., Esq.


Practice formation considerations achieving legal compliance with diverse private medicine models

(c) 2013 James J. Eischen, Jr., Esq.


Practice formation considerations achieving legal compliance with diverse private medicine models

  • One problem is that the current fee-for-service system makes it difficult to coordinate after-hours care with a patient's regular doctor. This is problematic considering that providers that know a patient well, or at the very least have a patient's medical record, are able to give better quality of care.

  • In 2010, 40.2 percent of people said their primary care clinics offered extended hours, such as at night and on weekends.

  • One in five people found it very difficult or somewhat difficult to reach their clinician after hours.

  • People that reported less difficulty reaching a physician after hours had fewer emergency department visits (30.4 percent compared to 37.7 percent).

  • Furthermore, there were lower rates of unmet medical needs (6.1 percent compared to 13.7 percent).

http://www.ncpa.org/sub/dpd/index.php?Article_ID=22692

(c) 2013 James J. Eischen, Jr., Esq.


Fee for service frustrating needed innovation

FEE FOR SERVICE FRUSTRATING NEEDED INNOVATION?

  • Internal medicine moving toward clinical care teams.

  • Fee for service reimbursement obstacles may frustrate this otherwise necessary shift.

    http://annals.org/article.aspx?articleid=1737234

(c) 2013 James J. Eischen, Jr., Esq.


Effect of competition on healthcare

EFFECT OF COMPETITION ON HEALTHCARE

  • Toyota's management philosophy and practices adopted by the hospital as a way to deliver medicine to its patients

    • Systematic approach to producing cars and trucks efficiently, with the primary goal of pleasing the customer

    • Attract and retain "paying customers" to survive

  • http://www.sfgate.com/health/article/S-F-General-following-Toyota-Way-to-efficiency-4879925.php

(c) 2013 James J. Eischen, Jr., Esq.


Why private medicine

WHY PRIVATE MEDICINE?

(c) 2013 James J. Eischen, Jr., Esq.


Evolving away from fee for services private subscription

EVOLVING AWAY FROM FEE FOR SERVICES:Private Subscription

  • Average annual fee = approximately $1,800

  • > 4,000 physicians practice privately in the United States in 2012

  • Private physician averages about 350 patients

  • Medicare changes = doctors reimbursed less for care provided

  • Private patients get

    • more face-time with doctors

    • more thorough annual physicals

    • focus on preventive medicine

  • Private fee makes up for lost revenue from declining reimbursements

http://www.ncpa.org/sub/dpd/index.php?Article_ID=22781

(c) 2013 James J. Eischen, Jr., Esq.


Why subscription patient buy in investment in health

WHY SUBSCRIPTION?Patient Buy-in/Investment In Health

  • Investing in health

  • Owning health outcomes

  • Realizing actual costs of poor health decisions

(c) 2013 James J. Eischen, Jr., Esq.


Practice formation considerations achieving legal compliance with diverse private medicine models

(c) 2013 James J. Eischen, Jr., Esq.


Practice formation considerations achieving legal compliance with diverse private medicine models

(c) 2013 James J. Eischen, Jr., Esq.


Practice formation considerations achieving legal compliance with diverse private medicine models

(c) 2013 James J. Eischen, Jr., Esq.


Practice formation considerations achieving legal compliance with diverse private medicine models

Already, one in five physiciansis restricting the number of Medicare patients in their practice and one in three primary care doctors – the providers on the front lines of keeping the cost of seniors’ care low – are restricting Medicare patients, according to a 2010 AMA survey of more than 9,000 physicians who care for Medicare patients.

http://www.forbes.com/sites/brucejapsen/2013/01/30/1-in-10-doctor-practices-flee-medicare-to-concierge-medicine/

(c) 2013 James J. Eischen, Jr., Esq.


Practice formation considerations achieving legal compliance with diverse private medicine models

(c) 2013 James J. Eischen, Jr., Esq.


Removing menu distortions from health care delivery

REMOVING MENU DISTORTIONS FROM HEALTH CARE DELIVERY

  • Subscription model is financially viable (“gym anology”)

  • Subscription = payment for counseling and medical direction disconnected from plan-funded intervention

  • Subscription = compensation for connection/tracking/coordination

(c) 2013 James J. Eischen, Jr., Esq.


Incentivizing customer service retention

INCENTIVIZING CUSTOMER SERVICE/RETENTION

  • Remaining connected vs. one-off consults

  • Patient accountability via persistent connection

(c) 2013 James J. Eischen, Jr., Esq.


Stabilized practice cash flow

STABILIZED PRACTICE CASH FLOW

  • FFS = financial disincentive to connect with medical practice

  • Subscription = investment in connection, incentive to remain connected

(c) 2013 James J. Eischen, Jr., Esq.


Private medicine has come a long way

PRIVATE MEDICINE HAS COME A LONG WAY

  • Washington

    • Qliance

  • Florida

    • MDVIP

  • Expansion with confirmed FFNCS model compliance

    • Fee For Non-Covered Service

  • Subscription models diversify

(c) 2013 James J. Eischen, Jr., Esq.


Practice formation considerations achieving legal compliance with diverse private medicine models

  • Private medicine delivers excellent care in a manner that is attractive to physicians.

  • Question: Whether it has the potential to fix many of the more serious problems that exist in our system for delivering primary care.

    • Affordability

    • Reducing the number of patients that private-practice physicians see significantly reduces the number of patients served by each primary care physician.

  • Private medicine remains attractive to doctors and patients in many regards. But significant questions remain about whether it should be promoted as a model that can meet the needs of most patients in society even with the advent of hybrid models.

(c) 2013 James J. Eischen, Jr., Esq.


How to structure private medicine models

HOW TO STRUCTURE PRIVATE MEDICINE MODELS

(c) 2013 James J. Eischen, Jr., Esq.


Understand the rules

Understand The Rules

Medicare

(c) 2013 James J. Eischen, Jr., Esq.


Medicare assignment compliance

MEDICARE ASSIGNMENT COMPLIANCE

  • Unless you have opted outof Medicare

    • Avoiding billing for covered services

    • Avoiding billing for “buzz words”

      • Access

      • Care coordination

      • Membership (?)

      • 24/7 communications (?)

      • Electronic records access

(c) 2013 James J. Eischen, Jr., Esq.


Liability and penalties for added payment for covered services

LIABILITY AND PENALTIES FOR ADDED PAYMENT FOR COVERED SERVICES

http://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/downloads/SE0421.pdf

(c) 2013 James J. Eischen, Jr., Esq.


Oig alert march 31 2004

OIG ALERT – MARCH 31, 2004

  • Alert from Office of Inspector General, March 31, 2004

  • http://oig.hhs.gov/fraud/docs/alertsandbulletins/2004/FA033104AssignViolationI.pdf

(c) 2013 James J. Eischen, Jr., Esq.


Oig alert 03 31 04

OIG ALERT 03-31-04

  • While the physician characterized the services to be provided under the contract as “not covered” by Medicare, the OIG alleged that at least some of these contracted services were already covered and reimbursable by Medicare.

  • Among other services offered under this contract were the “coordination of care with other providers,” “a comprehensive assessment and plan for optimum health,” and “extra time”spent on patient care. OIG alleged some of these contracted services were already covered and reimbursable by Medicare.

  • Result: Settlement paid to OIG and physician stopped offering the contract

(c) 2013 James J. Eischen, Jr., Esq.


Practice formation considerations achieving legal compliance with diverse private medicine models

  • A Roadmap for New Physicians: Avoiding Medicare and Medicaid Fraud and Abuse, U.S. Department of Health & Human Services and Office of Inspector General

  • http://oig.hhs.gov/compliance/physician-education/index.asp

  • Private reimbursement compliance issues

(c) 2013 James J. Eischen, Jr., Esq.


Practice formation considerations achieving legal compliance with diverse private medicine models

(c) 2013 James J. Eischen, Jr., Esq.


Practice formation considerations achieving legal compliance with diverse private medicine models

https://oig.hhs.gov/compliance/physician-education/index.asp

(c) 2013 James J. Eischen, Jr., Esq.


Practice formation considerations achieving legal compliance with diverse private medicine models

http://www.medicare.gov/pubs/pdf/10050.pdf

CHECK FOR MEDICARE COVERAGE

(c) 2013 James J. Eischen, Jr., Esq.


Practice formation considerations achieving legal compliance with diverse private medicine models

http://www.medpac.gov/chapters/Jun12_Ch02.pdf

BE CAREFUL

(c) 2013 James J. Eischen, Jr., Esq.


Practice formation considerations achieving legal compliance with diverse private medicine models

(c) 2013 James J. Eischen, Jr., Esq.


Oig no double billing

OIG: NO “DOUBLE BILLING”

  • If you are a participating or non-participating physician, you may not ask Medicare patients to pay a second time for services for which Medicare has already paid

    • Charging an “access fee” or “administrative fee” that allows patients to obtain Medicare-covered services from your practice constitutes double billing

    • It is legal to charge patients for services that are not covered by Medicare

  • If you have opted-out of Medicare

    • May charge for “access” and “care coordination”

    • Must comply with opt-out contract rules

(c) 2013 James J. Eischen, Jr., Esq.


Important reminders for medicare compliance

IMPORTANT REMINDERS FOR MEDICARE COMPLIANCE

  • DO NOT offer to sell “access”

  • DO NOToffer to sell “care coordination”

  • DO NOToffer to sell “extended hours”

  • DO NOToffer to sell “24/7 access”

  • DO NOTassume that because other practices do the above, it is OK

(c) 2013 James J. Eischen, Jr., Esq.


Opt out compliance requirements

OPT-OUT: COMPLIANCE REQUIREMENTS

  • The physician/practitioner has filed an affidavit in accordance with §40.9 and has signed private contracts in accordance with §40.8 but, the physician/practitioner knowingly and willfully submits a claim for Medicare payment (except as provided in §40.28) or the physician/practitioner receives Medicare payment directly or indirectly for Medicare-covered services furnished to a Medicare beneficiary (except as provided in §40.28); (For specific information about Chapter 15, sections 8 and 28, refer to http://www.cms.hhs.gov/Manuals/downloads/bp102c15.pdf on the CMS website. The sections of Chapter 15 that are revised by CR6081 are attached to CR6081.)

  • The physician/practitioner fails to enter into private contracts with Medicare beneficiaries for the purpose of furnishing items and services that would otherwise be covered by Medicare, or enters into private contracts that fail to meet the specifications of §40.8; or

  • The physician/practitioner fails to comply with the provisions of §40.28 regarding billing for emergency care services or urgent care services; or

  • The physician/practitioner fails to retain a copy of each private contract that the physician/practitioner has entered into for the duration of the opt-out period for which the contracts are applicable or fails to permit CMS to inspect them upon request.

(c) 2013 James J. Eischen, Jr., Esq.


Opt out noncompliance consequences

OPT-OUT: NONCOMPLIANCE CONSEQUENCES

  • All of the private contracts between the physician/practitioner and Medicare beneficiaries are deemed null and void.

  • The physician’s or practitioner’s opt-out of Medicare is nullified.

  • The physician or practitioner must submit claims to Medicare for all Medicare covered items and services furnished to Medicare beneficiaries.

  • The physician or practitioner or beneficiary will not receive Medicare payment on Medicare claims for the remainder of the opt-out period, except as stated above.

  • The physician or practitioner is subject to the limiting charge provisions as stated in §40.10.

  • The practitioner may not reassign any claim except as provided in the Medicare Claims Processing Manual, Chapter 1, “General Billing Requirements,” §30.2.13. (For more information about the General Billing Requirements refer to http://www.cms.hhs.gov/manuals/downloads/clm104c01.pdf on the CMS website).

  • The practitioner may neither bill nor collect any amount from the beneficiary except for applicable deductible and coinsurance amounts.

  • The physician or practitioner may not attempt to once more meet the criteria for properly opting out until the 2-year opt-out period expires.

(c) 2013 James J. Eischen, Jr., Esq.


Can i charge for patients access to electronic health records

CAN I CHARGE FOR PATIENTS’ ACCESS TO ELECTRONIC HEALTH RECORDS?

  • Patients can ask for a copy of their electronic medical record in an electronic form.

  • When individuals pay by cash they can instruct their provider not to share information about their treatment with their health plan.

  • New limits on how information is used and disclosed for marketing and fundraising purposes.

  • Prohibits the sale of an individuals’ health information without explicit permission.

  • MUST ONLY CHARGE ACTUAL COSTS

www.hhs.gov/news/press/2013pres/01/20130117b.html

(c) 2013 James J. Eischen, Jr., Esq.


Understand the rules1

Understand The Rules

State Laws – Insurance?

(c) 2013 James J. Eischen, Jr., Esq.


State law insurance issue s regardless of opt out status

STATE LAW INSURANCE ISSUES(REGARDLESS OF OPT-OUT STATUS)

  • Avoiding appearance (or reality) of insurance

  • Why?

    • Lack of adequate capitalization

    • Lack of registration

    • State law violation of insurance regulations

(c) 2013 James J. Eischen, Jr., Esq.


Understand the rules2

Understand The Rules

Insurance Contracts

(c) 2013 James J. Eischen, Jr., Esq.


Practice formation considerations achieving legal compliance with diverse private medicine models

  • HMO = NO

  • PPO = Maybe?

    • Discrimination

    • Hybrid

(c) 2013 James J. Eischen, Jr., Esq.


Understand the rules3

Understand The Rules

Incentives?

(c) 2013 James J. Eischen, Jr., Esq.


Practice formation considerations achieving legal compliance with diverse private medicine models

Discounting, rebates, insurance plan co—pays/deductibles: Avoiding improper incentivizing under state/federal laws

  • May not “incentivize”

    • No free toaster oven

    • Do not routinely waive co-pays and deductibles—WATCH OUT!

  • May not induce utilization

(c) 2013 James J. Eischen, Jr., Esq.


Conversion and practice formation

Conversion And Practice Formation

(c) 2013 James J. Eischen, Jr., Esq.


Physician patient contract drafting recommendations

PHYSICIAN-PATIENT CONTRACT DRAFTING RECOMMENDATIONS

  • Easy to read contract

    • Simplify

  • Clarity, particularly on key issues

  • Use FAQs and brochures to express details, use the contract to craft the compliance posture

  • Fee structure must avoid state insurance issues

  • Amenities allocated to private fees to avoid Medicare compliance issues (Q: Does your staff know how to properly explain your retainer/subscription model?)

    • Or comply with opt-out requirements

    • http://www.cms.hhs.gov/Manuals/downloads/bp102c15.pdf

  • Avoid inducements/discounting (i.e. no toaster ovens)

  • AVOID PROMISES YOU CAN’T KEEP

(c) 2013 James J. Eischen, Jr., Esq.


Physician patient agreement dealing with electronic communications

PHYSICIAN-PATIENT AGREEMENT DEALING WITH ELECTRONIC COMMUNICATIONS

  • Need separateePHI agreement for risk management/HIPAA compliance

  • Why?

    • HILA Final Rule: Non-compound ePHI consent

    • Also: Better risk management

(c) 2013 James J. Eischen, Jr., Esq.


Updating your physician patient contract

UPDATING YOUR PHYSICIAN-PATIENT CONTRACT

  • Laws governing coverage often change

  • Physician-patient agreement should be prepared by an attorney experienced in physician legal issues and reviewed annually

    • Every concierge/direct/private practice is different so every retainer agreement is different. There is no one right way to structure a physician-patient agreement. There is no one version of private medicine.

(c) 2013 James J. Eischen, Jr., Esq.


Must check practice compliance

MUST CHECK PRACTICE COMPLIANCE

  • Website

  • FAQs

  • Patient letters

  • Staff training!!!

(c) 2013 James J. Eischen, Jr., Esq.


Ama policy e 8 055 ethical guidelines for private physician practices

AMA POLICY E-8.055: ETHICAL GUIDELINES FOR PRIVATE PHYSICIAN PRACTICES

  • Be clear about the financial terms and do not pressure patients to agree to the arrangement.

  • Do not promote your private practice as providing better diagnostic care and therapeutic services.

  • If you have both private and non-private patients, meet the same diagnostic and therapeutic standards for each.

  • Continuity of care requirements apply.

  • Within your private practice, you may still provide services that can be billed to health insurers. Clearly define what is and is not covered under the private practice fee. Continue to comply with all relevant laws, rules and contractual requirements.

  • All physicians professionally obliged to care for those in need regardless of the ability to pay, especially when the need is urgent.

(c) 2013 James J. Eischen, Jr., Esq.


Diverse models

Diverse Models

(c) 2013 James J. Eischen, Jr., Esq.


Hybrid conversion

Hybrid Conversion

(c) 2013 James J. Eischen, Jr., Esq.


Practice formation considerations achieving legal compliance with diverse private medicine models

  • Patients voluntarily elect to subscribe

  • Patients allowed to remain in practice without subscribing

  • Probably complies with PPO contracts

  • Attorney and consultant support costs

  • Feasibility issues

    • Lower conversion rates

    • Mixed standards of health delivery

(c) 2013 James J. Eischen, Jr., Esq.


Cash opt out practice

Cash/Opt-Out Practice

(c) 2013 James J. Eischen, Jr., Esq.


Practice formation considerations achieving legal compliance with diverse private medicine models

  • Opted out of Medicare

  • Avoids Medicare assignment compliance issues

  • Attorney and consultant costs

  • Fee for service vs. subscription--Menu

  • Pros and cons

    • Cash menu = FFS

    • Subscription—simplified

    • Opt-out negatives?

(c) 2013 James J. Eischen, Jr., Esq.


Medicare participating subscription

Medicare Participating Subscription

(c) 2013 James J. Eischen, Jr., Esq.


Practice formation considerations achieving legal compliance with diverse private medicine models

  • Structured to avoid Medicare Assignment violations (Fee for non-covered services follows OIG guidelines?)

  • Retains PPO contracts?

  • Attorney support is very important, plus potential consultant support

  • Bills Medicare and PPOs?

    • Plan attitude shifts

    • Co-pays and deductibles

  • Annual vs. monthly subscription

  • Pros and cons

    • Medicare compliance complex

    • Benefits from combined private and plan billing

    • PPO plans may elect to terminate plan participation

(c) 2013 James J. Eischen, Jr., Esq.


Direct lower fee subscription

“Direct” Lower Fee Subscription?

(c) 2013 James J. Eischen, Jr., Esq.


Practice formation considerations achieving legal compliance with diverse private medicine models

  • Structurally one of the prior models—same considerations

  • Tends to be: Opted out for lower monthly fee subscription (but not always)

  • National and solo models

    • Using a national or regional model may not avoid attorney and consultant needs!

  • Pros and cons

    • Affordability

    • Large patient pools avoid some policy negatives

    • Compliance issues with state insurance laws

    • Simplicity

(c) 2013 James J. Eischen, Jr., Esq.


National regional models

National/Regional Models

(c) 2013 James J. Eischen, Jr., Esq.


Practice formation considerations achieving legal compliance with diverse private medicine models

  • Business entity handles conversion and billing (and other?) administrative services

  • Practice/Physician contract with entity

  • Still recommend legal support, may avoid consultant costs?

  • Pros and cons

    • Less physician business execution, and no consulting fee obligation

    • Less retention of gross venue (varies)

    • Significant benefits with conversion vs. over time

    • Standardized administrative functions?

(c) 2013 James J. Eischen, Jr., Esq.


Bottom line

BOTTOM LINE

  • Subscription for

    • Non-covered services (Par/Non-Par)

    • All services (Opt-out, with compliant contract)

    • Limited or finite services (avoid insurance issues)

  • Exclude mandated services

    • Electronic records access

    • Watch out for preventative care

  • Deal with HIPAA! (i.e., you can’t avoid the federal government)

(c) 2013 James J. Eischen, Jr., Esq.


Questions

Questions?

James J. Eischen, Jr., Esq.

Office:(619) 819-9655

Email: [email protected]

Skype: jeischenjr

http://www.assessmentandplan.com

http://www.higgslaw.com

(c) 2013 James J. Eischen, Jr., Esq.


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