Question: We are considering establishing a comanagement arrangement with a group of orthopedic surgeons. What are some of the thornier compliance issues that we should pay attention to at the outset of discussions?
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Answer: I am unable to quote a source, but I understand that comanagement agreements, while once popular, have fallen out of favor with some lawyers. I suspect it has to do with enforcement actions and developing case law interpreting the Stark statute.
The comanagement arrangement would have to meet an exception under the Stark law. To meet the personal services or fair market value compensation exception, the agreement has to be for identifiable services, at fair market value, and "commercially reasonable." See federal regulation 42 C.F.R. § 411.357, Exceptions to the Referral Prohibition Related to Compensation Arrangements-particularly (d) and (l)-for all of the elements that must be satisfied to meet these exceptions to the Stark law's referral and billing prohibitions. Unless the agreement is carefully drafted, and performance under the agreement well-documented with tangible performance measures, it might not be looked on favorably when scrutinized.
The Centers for Medicare & Medicaid Services has started posting information on its settlements with organizations using the Stark self-disclosure protocol. These might prove insightful as to the types of arrangements that are problematic.
Unless otherwise noted, any opinions expressed are my own and not those of my employer, Halifax Health. I am not a lawyer. My comments should not be construed as legal advice.
This question was answered by George Rousis, director, corporate compliance and audit services, Halifax Health, Daytona Beach, Fla. (email@example.com).
Answer: One consideration is "influence and control." If the manager is able to make a decision that has an impact on the other employer, the controls are considered weak and it could have a financial impact to either clinic.
Different operational arrangements would have different compliance concerns. Possible compliance concerns related to comanagement may include the following:
- Compensation arrangements and any transfer of funds
- Patient services referred between the two clinics
- Sharing of financial information (i.e., contracts, billing, HIPAA privacy)
- Sharing of resources
This question was answered by Diane Blaha, compliance consultant, Spofford, N.H., and a member of HFMA's New Hampshire-Vermont Chapter (firstname.lastname@example.org).
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Publication Date: Friday, March 16, 2012