Articles Posted in Improving Your Practice

hammer-to-fall-673264-mOn January 19, 2017, the United States Department of Justice (DOJ) issued a press release announcing a deal reached with Costco Wholesale to resolve DOJ’s disputed allegations that Costco violated Federal law in filling prescriptions by lax protocol.  The allegations against Costco stem from an investigation by the United States Drug Enforcement Agency (DEA) Diversion Groups based in Seattle, Los Angeles, Sacramento and Detroit.

Georgia Healthcare and Business Litigation Law Firm

Our Atlanta and Augusta-based business law firm closely follows healthcare industry legal developments, including the healthcare fraud and abuse matters.  A strong focus of the DEA and supporting Federal and State law enforcement activities is the current epidemic of Opioid abuse in the United States.  According to the United States Centers for Disease Control and Prevention (CDC), deaths from Opioid overdose in the United States have quadrupled since 1999; and during the same period, sales of these drugs quadrupled.  The most common such Opioids are Methadone, Oxycodone and Hydrocodone.  “Pill mills” are a principal target of DEA and State law enforcement efforts.  To combat pill mills and other circumstances that may give rise to misuse of opioids and controlled substances, the DEA will pursue healthcare providers and entities that fail to strictly follow legal protocols in prescribing or dispensing controlled substances.

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US-SUP-CTThe United States Department of Health and Human Resources (HHS) and the United States Department of Justice (DOJ) recently issued a joint annual report for 2016 (the Report) providing details about the federal fraud and abuse program and, in particular, annual financial recoveries.  Fraud and abuse law enforcement efforts continued to be a top priority for the Federal Government and an important means of defraying the rising costs of our nation’s healthcare delivery system.  According to the Report, the Federal Government obtained over $2.5 billion in additional revenue in 2016 by way of health care fraud judgments and settlements.

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u-s-supreme-court-hallway-1224332-e1481731366543-272x300So much focus is placed on the federal “whistleblower” statute, the Federal False Claims Act, that similar acts, such as various States’ versions of the law, are often not as well known.  All have a common thread: they are a tool to recover tax payer money lost to fraudulent acts and serve to deter such fraud. Georgia has two false claims act statutes designed to combat fraud and abuse in Georgia.

Georgia Healthcare Whistleblower Law Attorneys

A brief history of this area of law puts the modern Federal and Georgia False Claims Acts in proper light.  The Federal False Claims Act was passed during the Civil War era in response to fraud by government contractors who seized the opportunity of intense government spending on the war to defraud the government.  An essential concept undergirding the earliest versions of the law was to create a financial incentive for one dishonest contractor — a “relator” — to turn in another.  Hence the original law (1863) provided that the relator could be paid up to one-half of the government’s recovery in a false claims act case.  The original law survived for decades as a remedial statute designed as a means for the Federal Government to recover what were thought to be, without the law, unrecoverable substantial losses for the treasury that attended dishonest acts. As one court explained:

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As the healthcare market witnesses a rise in consolidation, many small medical practices are closing their doors. Whether the physician is retiring, moving, or joining a larger system, closing a practice can be a much larger hassle than most physicians expect. Closing a medical practice involves several steps, including, but not limited to: notifying patients of the intention to retire, making decisions about insurance policies, selling or winding down the medical practice, and fulfilling record keeping responsibilities.

Licensure Board notification. If a physician is retiring and plans to become inactive, they must notify the Composite Medical Board of their intent to do so. The Board does not require physicians to notify them when they retire or close a practice; however, physicians who wish to become inactive must submit a form requesting inactive status. Physicians who are simply leaving a practice or moving have no obligation to inform the Board of their move.

Patient notification. When closing a practice, and thereby ending their physician-patient relationships, a physician must take appropriate steps to avoid claims of “patient abandonment.” Abandonment is defined as the termination of a professional relationship between physician and patient at an unreasonable time and without giving the patient the chance to find an equally qualified replacement. By not ensuring proper procedures are taken, a physician may risk investigation by the Composite Medical Board if a complaint is filed.

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health-insuranceOverview

Credentialing is used to evaluate physicians for different purposes and is required of almost all physicians. It is utilized by hospitals when evaluating physicians for medical staff positions and hospital privileges and when enrolling in health insurance plans as a participating provider. Unfortunately, this process has not been streamlined and can be very time consuming and complex.

Provider credentialing is meant to verify experience, expertise, and willingness to provide medical care. It is often a complex, ongoing process that can take several months to be completed and approved and is an administrative hassle for employers, insurance companies, and physicians. While credentialing was historically just proof of licensure, modern credentialing goes far beyond proof of diploma and license.

mobile-phone-in-hand-1438231-1-mHow could it not?

The healthcare industry is rapidly evolving.  As recently reported in U.S. News and World Report, next on telemedicine’s horizon may be virtual care clinics.  In fact, so-called virtual care will likely revolutionize the delivery of health care in the coming years. “Virtual,” in this context, alludes to the fact that care providers, doctors, nurses and therapists, may provide most care from many miles away.

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Various genres of “virtual care” delivery exists already.  One notable pioneer is Mercy Virtual.  Mercy, based in Chesterfield, Missouri, emphasizes that an objective of its mission is to ensure access to quality care, explaining: “Mercy Virtual’s mission is to connect patients with leading care providers whenever, wherever they need help.”  In recent years, many other medical businesses are finding and developing their own niches in the evolving virtual healthcare world.  Several of the numerous examples are: Teladoc, which provides online, 24/7 access to primary care physician services; American Well, which claims to offer “telehealth” to more than 100 million people in an online marketplace where customers select their healthcare provider from a list; Carena provides a range of healthcare services that include virtual visits for the employees of self-insured companies; Zipnosis is a platform that, through “phone and video care,” helps patients get answers to their healthcare questions and helps physicians treat primary care ailments; MeVisit enables “e-visits” that allow patients to use their mobile device to connect with a doctor.

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medical-doctor-1314903-mIn the past two decades, a growing number of physicians in private practice dissatisfied with reimbursement rates, paperwork and other aspects of the federal Medicare program have opted out of the program.   According to an article by William Buczko available on the Centers for Medicare and Medicaid Services (CMS) website that explains the history and details of the Medicare Opt Out process: 2,839 physicians and other providers opted out of Medicare between 1998 and 2002. They comprised 0.42 percent of providers eligible to opt out in that period.

Since then, those numbers have continued to grow, with Medicare officials recently reporting about 4 percent of U.S. physicians and other providers having opted out.

The Opt Out Process

The Medicare Opt Out process requires three steps, according to an article by Physicians Practice. These include:

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hospital-corridor-2-65904-m Hospital systems and other large healthcare providers face increasing risks associated with noncompliance with the Family and Medical Leave Act (FMLA), as FMLA litigation is on the rise. According to Law360, FMLA litigation tripled in one year (from 2012 to 2013). Our Georgia business and healthcare law firm has litigated FMLA and numerous other employment law cases in federal court. Because following the regulatory scheme of the FMLA can involve difficult details (e.g., tracking intermittent leave taken in small increments), many employers can violate the Act inadvertently. Retaliation claims are also problematic because of how the employee is treated before and after the medical leave. Tight protocol and committed training of management, supervisors and HR personnel is critical to minimizing the financial risks associated with FMLA noncompliance.

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hospital-corridor-1057587-m.jpgFor Federally Qualified Health Centers and other eligible safety net health care centers, proper utilization of the federal Section 340B Drug Discount Program can offer enormous financial advantages to facilitate delivery of high quality primary health care services to their communities. The Section 340B Program, created in 1992, requires drug manufacturers to provide outpatient drugs to qualifying health care centers and organizations at reduced prices. The purpose of the Section 340B Program is to provide a financial advantage that supports FQHCs and other safety net providers, enabling them to stretch scarce federal resources as far as possible to the benefit of their patients.

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The federal Health Resources and Services Administration (HRSA), which regulates and supervises the Section 340B Program, has legal authority to audit Section 340B Program covered entities. Alternatively, HRSA may authorize a drug manufacturer to audit a covered entity under particular circumstances and according to HRSA’s protocol. An audit is for the purpose of assessing covered entity compliance with HRSA regulations and protocol governing the Section 340B program and, in particular, to identify and remedy diversion of Section 340B drugs or duplicate discounts.

Program Integrity Audits, as they are known, were first initiated in 2012 and have increased each year. Audit results can be reviewed on the HRSA website. A covered entity’s failure to pass audit scrutiny can result in very adverse financial consequences, including having to refund discounts to a drug manufacturer and/or exclusion from the Section 340B Program. Through Fall 2014, approximately 240 audits have been performed. More audits are expected in 2015, as HRSA continues to ramp up its oversight and scrutiny of the Section 340 participants. Many hundreds of FQHCs will be the subject of upcoming audits.

For FQHCs and other covered entities that potentially subject to an audit, the financial stakes are so high that audit readiness should be a top priority. Fortunately, HRSA provides contract pharmacy guidelines that, if properly followed, can reduce the risk of being audited and of a bad audit outcome. For every Section 340B participant, following HRSA guidelines is therefore a must.
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exam-room-1-260748-m.jpgA Michigan legislator’s bill, SB 1033, sponsored by Senator Patrick Colbeck, would benefit direct primary care doctors in that State, and the idea may warrant consideration in other States. The purpose of the bill is to provide physicians who convert their practice to a direct primary care model with the assurance that their medical practice will not be treated as an insurer regulated under state insurance regulations.

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Among other legal hurdles some physicians may face in developing a direct primary (or concierge) care practice model is avoiding the creation of an insurance product. This can be a central legal issue for such practices. A distinguishing feature of the direct primary care model is that the patient, sometimes referred to as a “member” or “enrollee,” receives medical care without paying anything other than a predetermined periodic fee, sometimes referred to as a “medical retainer.” The theory behind the insurance issue is that by accepting a set, predetermined fee in advance of the medical services, the physician or medical practice is, in effect, underwriting an insurance risk. The consequences of a state insurance regulator determining that a medical practice is operating as an insurance company can be severe.

Senator Colbeck’s bill is intended to avoid such problems in Michigan. The bill provides, in part, as follows:

(1) A medical retainer agreement is not insurance and is not subject to this act. Entering into a medical retainer agreement is not the business of insurance and is not subject to this act.
(2) A health care provider or agent of a health care provider is not required to obtain a certificate of authority or license under this act to market, sell, or offer to sell a medical retainer agreement.
(3) To be considered a medical retainer agreement for the purposes of this section, the agreement must meet all of the following requirements:

(a) Be in writing.
(b) Be signed by the health care provider or agent of the health care provider and the individual patient or his or her legal representative.
(c) Allow either party to terminate the agreement on written notice to the other party.
(d) Describe the specific routine health care services that are included in the agreement.
(e) Specify the fee for the agreement.
(f) Specify the period of time under the agreement.
(g) Prominently state in writing that the agreement is not health insurance.
(h) Prohibit the health care provider, but not the patient, from billing an insurer or other third party payer for the services provided under the agreement.

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