Future Trend: Fighting Fraud and Abuse with "Transparency"

The following article is from Elizabeth Hogue, Esq,(ElizabethHogue@ElizabethHogue.net) an attorney who specializes in Medicare/Medicaid/Home Care. In any case, the issue of public disclosure of gifts is always a hot button for agencies and the article below goes into some detail on what is/is not allowable.

Physicians routinely expect or perhaps demand gifts from home health agencies, private duty agencies, home medical equipment (HME) companies, and hospices to which they make referrals.

Generally, the rules governing such gifts are as follows:

- No cash

- No cash equivalents, including gift cards and gift certificates

- Non-cash items of nominal value are permitted, so long as the value of such items does not exceed approximately $350.00 per calendar year.

- Non-cash items of nominal value given cannot induce referrals.

The stakes are high if providers were to violate these rules. Providers on “both sides of the fence” may be suspended or excluded from participation in federal and state health care programs. They may be required to pay large civil money penalties or fines. Providers may also lose their licenses or go to jail. Many providers, however, have heard stories about their competitors who do not comply with these rules.

Regulators are now adding something new to their “arsenals:” providers and physicians may be required to publicly disclose all of the gifts they give and receive. The rationale behind this requirement is that “transparency” may discourage providers and physicians from violating the law. Regulators expect that public disclosures will make criminal behavior more difficult to conduct and easier to detect. They also anticipate that disclosures may serve as deterrents for violators.

As part of settlements of alleged violations of the above rules, for example, regulators require a growing number of providers and manufacturers to post publicly all of the payments they have made to doctors. Corporate Integrity Agreements (CIA’s) entered into between alleged violators and the Office of Inspector General (OIG) of the U.S. Department of Health and Human Services may also require such disclosures.

In Gardiner Harris’ article entitled Prosecutors Plan Crackdown on Doctors Who Accept Kickbacks, which appeared in the New York Times on March 4, 2009, Dr. David Rothman, President of the Institute on Medicine at Columbia University was quoted as saying: “The rules of the game have changed…You’ve got to presume that anything you take from a …company is going to be on a Web Site. Your colleagues will know; your patients will know. That’s going to stop a lot of doctors from pocketing their gifts and funds.” Doctors whose financial arrangements have already been made public are horrified.

For example, the above article describes Dr. Richard Grimm, a physician in Minnesota engaged in substantial amounts of research, who served on a government-sponsored panel that creates guidelines about when to prescribe medication for blood pressure. State records revealed that Dr. Grimm received payments of approximately $800,000 from drug companies over a period of eight years. Invitations to serve on such panels then dried up.

Undoubtedly, providers who are “bad actors” will continue to flout the rules. The proverbial handwriting, however, is on the wall. The game has changed and will continue to do so.