July 8th 2024

3 home Health Providers to pay $4.5M to Settle Kickback Allegations

Guardian Health Care, Gem City Home Care, and Care Connection of Cincinnati have agreed to a $4.5 million settlement to resolve allegations of offering kickbacks to physicians and assisted living facilities in exchange for Medicare referrals. According to a July 1 news release from the Justice Department, these companies, under Evolution Health's ownership, allegedly engaged in these illegal practices from 2013 to 2022. During this nine-year period, they made lease payments and provided other benefits to secure referrals of Medicare beneficiaries. Subsequently, they billed Medicare for the home health services rendered to these referred patients. Operating in Texas, Ohio, and Indiana, the companies are implicated in the scheme.

Link: https://bit.ly/45XKg7l

Attention Healthcare Compliance Attorneys!!!

If you need assistance with healthcare compliance training, education, designing compliance programs, or coaching, contact Jay Anstine at Bluebird Healthlaw Partners.

Bluebird Healthlaw Partners is a consulting firm dedicated to healthcare compliance. It advises clients on corporate compliance programs and regulatory compliance matters. Bluebird Health Law Partners helps its clients by identifying solutions that maintain compliance while furthering their business objectives.? Go to: www.bluebirdhealthlaw.com

Due Diligence on Physician Compensation During a Practice Acquisition

Conducting due diligence for physician compensation arrangements during an acquisition of a medical group is crucial for the acquirer. Proper due diligence is essential, whether the transaction involves a stock or asset purchase. If inappropriate financial arrangements exist and continue after the transaction, the acquirer will assume liability in both scenarios. In the case of a stock purchase, the acquirer will essentially "step into the seller's shoes" and potentially assume all pre-transaction liability.

Healthcare attorney Robert Wade of Nelson Mullins Riley & Scarborough has written some excellent guidance on this matter.

Link: https://bit.ly/3LdHktR

Gift Giving to Physicians? - What You Need to Know

Providing physicians gifts and other business courtesies can raise compliance concerns.? So, it’s good to know the laws and the limits. Hooper, Lundy & Bookman, P.C. healthcare attorneys Stephanie Gross, Emily Brodkin, and Charles Oppenheim wrote some very helpful guidance on this topic. https://bit.ly/4cRyDkr

Physician Compensation Survey Data – The Good and Bad

Provider compensation professionals rely heavily on current published market survey data—covering provider compensation, production, medical directorship, call pay, and academic compensation—to establish fair and competitive compensation terms. This data serves as a cornerstone for conducting market benchmark analyses and ensuring conclusions drawn on commercial reasonableness and fair market value are legally defensible.

Within the physician compensation community, phrases like 'art and science' (referring to the subjective and objective elements in compensation analysis),'facts and circumstances' (indicating the need to consider specific situations and conditions), and 'the survey says' (emphasizing the importance of data-driven decisions) are commonplace. Professionals closely scrutinize any guidance from government agencies to understand better compliance with complex regulatory frameworks governing provider relationships.

Some common misconceptions, misuses, myths, and criticisms of survey data include:

• misinterpretations of metrics like compensation-per-wRVU rates;
• challenges in reflecting local market nuances (such as rural settings or high-cost areas);
• the voluntary nature of survey participation;
• biases in data reporting;
• limited sample size relative to the broader provider population;
• discrepancies in survey definitions and
• data reporting lags.

Key survey sources such as the Medical Group Management Association (MGMA), American Medical Group Association (AMGA), and others play pivotal roles in provider compensation benchmarking. However, recent shifts—like MGMA state chapters moving to the Healthcare Leaders Association (HLA)—raise questions about future survey reliability and accessibility. Despite assurances of continuity from MGMA officials, disruptions in data collection due to organizational changes could potentially affect survey outcomes.

Furthermore, conflicts of interest have arisen, with some survey organizations limiting survey access to certain valuation firms or significantly raising survey pricing annually. These developments underscore the real and ongoing challenges in maintaining survey integrity and reliability for compensation benchmarking. These concerns are valid, and it's important to address these issues in the industry.

Amidst these shifts, opportunities may emerge for new surveys or methodologies, potentially spearheaded by organizations like the American Association of Provider Compensation Professionals (AAPCP) or HLA. These potential changes bring a sense of hope and optimism, reflecting an evolving landscape in provider compensation practices and perhaps the consideration for an alternative valuation approach beyond traditional survey-based approaches.

However, the survey-based approach is what the majority of the industry players rely upon. It’s important to remember that FMV is not an exact number but a reasonable range of numbers.? Responsible use of survey data by qualified appraisers gets us to a reasonable and supportable number.? It’s not acceptable practice to blindly take the median or average figure. Plus, a large sample size will tend to weed out some of the shortcomings of using survey data.