Q Recently a durable medical equipment company that I frequently use approached me with the following idea. In exchange for a list of my patients, they would create and host a website for me that would give me greater exposure to the type of patients I am trying to attract. Do you see any problem?
A If you breach your patients’ privacy, you may be subject to lawsuit for negligence, invasion of privacy and for breach of contract under proposed privacy rules announced by the federal government on Dec. 20, 2000. The proposed rules are part of the Health Insurance Portability and Accountability Act of 1996 (HIPAA). HIPAA is not the only legislation with which you must be concerned. Check your state’s privacy statutes. You are required to comply with the stricter rules.
Knowing and willful disclosure of personally identifiable health-care information can be punished by a fine of $50,000 and a prison sentence of one year, and up to a fine of $250,000 and a 10-year prison term.
Make sure the protection of your patients’ privacy is part of your compliance plan and that your staff is aware of the importance of not divulging any information concerning your patients.
Q May I offer bonuses to the doctors who work for my practice, and how should I structure those bonuses?
A Your question requires a two-pronged answer, depending upon whether you are providing Medicare/ Medicaid services
If you are providing Medicare/Medicaid services, section 1877(h)(4)(A)(iv) and (B)(i) of the proposed Stark II regulations states that a doctor’s compensation may not be based, directly or indirectly, on the volume or value of his or her referrals. The doctor may, however, receive a productivity bonus, as long as the bonus does not reflect the volume or value of that doctor’s own referrals.
A doctor’s compensation may also reflect a bonus for designated health services the doctor personally performed or were performed “incident to” services the doctor directly supervised, provided the services performed were not as a result of a referral from the doctor performing the service. For example, if Dr. Able (who does not have a “prohibited” relationship with Dr. Baker, such as a family relationship), refers a patient to Dr. Baker and Dr. Baker performs the service or a service is performed incident to Dr. Baker’s instructions and under his supervision, then Dr. Baker may receive a bonus for the treatment of that patient.
In this situation, Dr. Baker isn’t being compensated based on the volume or value of his own referrals. A doctor can receive compensation for his or her own referrals for designated health services only through the aggregation that occurs as part of overall sharing of profits. Profits may be shared as long as such bonuses have nothing to do with a doctor’s referrals for designated health services under Medicare or Medicaid.
If Medicare/Medicaid services are not being provided, doctors may be compensated under any productivity plan that a group creates, as long as the plan does not violate applicable state laws. Group practices use many different measures of a doctor’s productivity, such as counting patient encounters, charges or collections attributable to the doctor, hours of patient care services, factoring in the degree of difficulty of a doctor’s procedures, ways in which the doctor has improved his or her professional qualifications, or the amount of time the doctor is willing to be on call. In addition, a group can pay doctors based on a percentage of profits, straight salary, or any combination of base and incentive payments.
Q Many of my patients have refused to pay me for services I provided when they later learned that their insurance coverage would not cover that particular service. What can I do about this?
A The first thing you should do is verify coverage before providing the service. If coverage is denied, let the patient know the insurance company denied coverage. Many patients may still want the service, so make sure they sign an Authorization and Payment Agreement for Non-Covered Services, similar to the one shown here. Having the patient sign this type of an agreement and asking for payment for the service in advance should eliminate any potential payment problems.
Ms. Green has been a practicing attorney since 1977. She is admitted to the practice of law in New York and Florida. She has formed numerous integrated practices throughout the country.
Because this column is being presented to you by an attorney, it would not be complete without a legal disclaimer. This column is provided subject to and governed expressly by the terms of this disclaimer. This column is provided for educational purposes only. The accuracy or timeliness of the information presented herein is not warranted. The information presented herein is not intended to be advice as to a specific fact pattern with which you may be presented. Accordingly, please note that the information contained herein is not being presented as legal advice with respect to any matter and that no attorney-client relationship is hereby established.