From: hounddog23x@gmail.com   
      
   New Fraud Alert Shows OIG Focus on Physicians   
      
   posted on: Thursday, June 11, 2015   
      
      
      
   On June 9, 2015, the Office of Inspector General of the Department of Health   
   and Human Services (OIG) issued a new fraud alert concerning physician   
   compensation arrangements and compliance with the federal Anti-Kickback   
   Statute (AKS). While the fraud    
   alert itself does not break new ground interpreting the AKS, it signals OIG's   
   steadily increasing scrutiny and enforcement activity of physicians and   
   physician arrangements.   
      
   The fraud alert encourages physicians who enter into compensation   
   arrangements, such as medical directorships, to "ensure that those   
   arrangements reflect fair market value for bona fide services the physicians   
   actually provide" by "carefully consider[ing]   
    the terms and conditions of medical directorships and other compensation   
   arrangements before entering into them." Payments that take into account the   
   volume or value of referrals, do not reflect fair market value for the   
   services performed, or    
   compensate the physician in ways that are unrelated to providing   
   services--such as subsidizing office staff costs--raise compliance risks,   
   according to the OIG. Similarly, not providing the services called for under   
   the arrangement can also create    
   liability issues.   
      
   Rather than provide new or updated AKS guidance to the health care community,   
   however, this fraud alert's purpose appears to be to publicize a series of 12   
   settlements under the OIG's Civil Monetary Penalties Law (CMPL) authorities   
   obtained over the past    
   two years with individual physicians who had medical director arrangements   
   with Fairmont Diagnostic Center and Open MRI Inc. (Fairmont), an imaging   
   facility in Houston owned and operated by Dr. Jack L. Baker. In 2012, Dr.   
   Baker and Fairmont entered into    
   a $650,000 False Claims Act settlement concerning allegations that Dr. Baker   
   and Fairmont paid illegal compensation to physicians through medical director   
   agreements to induce patient referrals. As part of the settlement, Dr. Baker   
   agreed to be excluded    
   from federal health care programs for six years. Following the settlement, OIG   
   pursued "spin-off" CMPL cases against some of the physicians who had these   
   suspect medical director agreements. In total, the OIG collected over $1.4   
   million in penalties from    
   11 physicians and excluded one physician for three years. The settlement   
   amounts ranged from $50,000 to $195,016.   
      
   The fraud alert highlights that the OIG is stepping up its own administrative   
   enforcement activities of physicians separate from the government's more   
   traditional False Claims Act efforts. With a large budget increase this year,   
   the OIG is able to hire    
   more lawyers who can investigate and bring CMPL cases. The OIG has displayed   
   additional signs of interest in physicians, including a ramped-up issuance of   
   guidance. After a somewhat lengthy span without issuing much guidance, the OIG   
   has issued a new    
   fraud alert specifically addressing physician issues each year for the past   
   three years. In 2013, the OIG warned the industry about its concerns with   
   physician-owned distributors and other joint ventures. In 2014, the OIG   
   cautioned labs and physicians    
   about labs making certain suspect specimen collection and other payments to   
   physicians.   
      
   We should expect to see more OIG scrutiny of physicians and their financial   
   arrangements with the recipients of their referrals. To avoid this scrutiny,   
   health care entities should consider examining their compliance program's   
   policies and systems    
   regarding   
      
   Review and approval of physician arrangements, including   
      
   The physician selection process   
      
   The business justification for the arrangement   
      
   An appropriate internal and legal review process   
      
   Making fair market value determinations   
      
   Monitoring physician performance of the services provided for in the   
   arrangement   
      
   Contract management to avoid potential technical Stark Law issues   
      
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