The U. S. District Court for the Middle District of Georgia was more active than I was, however, when it recently held that a physician who unsuccessfully sued the hospital where he worked, and some other physicians on staff, must pay the defendants' attorneys fees and costs because he had signed an "Applicant's Consent and Release" when he was applying for medical staff privileges at the defendant hospital. The amount to be paid is yet to be determined but could be substantial because there were 3 defendants seeking fees, including two physicians and their group professional corporation.
In the case of Adeduntan v. Hospital Auth. of Clark City, No.3:04-CV-065 (CDL)(M.D. Ga. July 31, 2008), arising out of the medical peer review of plaintiff's performance during an emergency abdominal aortic aneuryism procedure, the Court found that "...[Dr. Adeduntan] was required to execute the form in order to apply for mediacal staff appointment and privileges at Athens Regional and that [his] signature appears on multiple copies."
The language of the document provided:
"If...I [Dr. Azeez Adeduntan] institute legal action against the Hospital [Athens Regional] and/or its Medical Staff members and do not prevail, I agree to reimburse the Hospital and any Medical Staff members named in the action for any and all costs incurred in defending the legal action, including reasonable attorneys fees."
Recognizing that credentialing litigation is on the rise because of numerous decisions allowing such disputes to move into the courts, and most American courts cannot impose attorney fee obligations on losing litigants, in the absence of a contractual requirement, I would expect that most staff privilege applications would be promptly amended to include such language.
Depending on the applicant's specialty, and state law, the language may or may not be negotiable. A good healthcare attorney, however, is essential to review the application, research the issue and attempt to obtain any modifications. As always, even the most innocuously appearing document--a simple "application" may contain time-bombs that lay dormant for many years.
]]>The State of Michigan can recoup extra funds from combined state/federal recoveries because of the provisions of the federal Deficit Reduction Act of 2005 ('DRA"). To explain, shortly after the the Michigan Medicaid False Claims Act amendment passed the Michigan Legislature and Governor Granholm signed the Act, the U.S. Congress passed the DRA providing for a 10% incentive to States which enacted a "compliant" Qui Tam statute addressing Medicaid fraud. Specifically, the Medicaid program is a joint federal/state program. Thus, in Michigan, the federal government pays about 56% and the state 44% of the costs of the Medicaid program and fraud recoveries are divided on the same percentage.
If the state has a "compliant" Qui Tam statute, the state receives an extra 10% of the recovery--that is, 54% in Michigan--of the recovery--instead of 44%--a significant amount of money since most recoveries are in the tens of millions of dollars or more!!
However, on December 21, 2006, the U.S, Department of Health and Human Services/Office of Inspector General ("HHS/OIG") advised the state, by letter, that its Medicaid False Claims Act was NOT "DRA compliant" (that is, a mirror image of the federal False Claims Act).
In order to comply, all that was needed was a simple bill adding civil monetary penalties of at least $5000 for each violation and making one other technical amendment. Since the revisions would not have had any negative fiscal impact on the state and would have had a potentially tremendous positive impact in the event of any recovery, one would have expected Representative Law to quickly introduce a clarification/modification bill and obtain quick passage--after all, the State would most certainly not turn down the opportunity to reverse the flow of funds from Michigan to Washington??
Unfortunately, in 2006 and 2007, petty partisan bickering was rampant in the Michigan Legislature--we were paralyzed by the absurd budget fight and leadership was non-existent.
Rep. Law, finally, on September 17, 2007, introduced a one-page bill. The date of introduction is significant. In addition to being a Saturday, the day of the Notre Dame-UM football game (a game, I suspect, Rep. Law, a Notre Dame grad, was attending), it was three days before Ray Sayeh, then a WXYZ-TV investigative reporter, had scheduled (at my request) an interview with the representative to discuss the failure to take action on the revisions.
Unfortunately, again because of partisanship and Democratic control of the House of Representatives, the bill went nowhere while the Attorney General continued to obtain recoveries from fraud-feasors and the unclaimed 10% incentive was lost to Washington.
Finally, on February 19, 2008, Representative Marc Courveau (D., Northville) introduced HB 5757. The amended FCA, as presented in HB 5757, would allow the Michigan FCA to become DRA compliant. Once again, the small changes made by HB 5757, as required by the federal HHS/OIG., would cost the state nothing in administrative or other costs and would bring millions of dollars in the future back from Washington.
HB 5757 quickly passed the House with NO opposition and was sent to the Senate.
Tragically, because of continued political maneuvering, the Bill sits in the Judiciary Committee.
It seems that Rep. Courveau was elected at the expense of a Republican and the leadership of the Judiciary Committee and Senate Majority Leader, Mike Bishop will not allow this largely unopposed, fiscally responsible bill, to be brought up at the committee or floor level because it would give "points" to Rep. Courveau!!!!
The State of Michigan is in a deep recession/depression, unemployment sits at 8.5%, the highest in the nation, GM is in deep trouble, the City of Detroit is selling assets and landmarks--such at the Detroit-Windsor tunnel--and the Legislature cannot pass a one-page bill that will bring money to the state and its Medicaid recipients.
This Bill is under the radar, unfortunately--Ray (now Rez) Sayeh has joined CNN International and is posted in Pakistan, columnists such as Brian Dickerson and others have been unresponsive despite my entreaties, my solicitations to the Legislature and the use of my contacts have been unavailing.
I am frustrated. Medicaid fraud is rampant, the Attorney General is acting diligently in pursuing the cheaters, and we have been filing qui tam cases under the new Act, but even if all of these activities are successful--and they will be--the State will not receive the full benefit of its recoveries!!!
I will not stop my efforts, but it will take action by my readers to move this along. Sen. Mike Bishop may be contacted by email and his office phone number is( 517) 373-2417
The other Senators on the Judiciary Committee may be emailed at: senwkuipers@senate.michigan.gov Sen. Kuipers - Chair senacropsey@senate.michigan.gov Sen. Cropsey senasanborn@senate.michigan.gov Sen. Sanborn senbpatterson@senate.michigan.gov Sen. Patterson sengwhitmer@senate.michigan.gov Sen. Whitmer - minority vice-chair senhclarke@senate.michigan.gov Sen. Clarke senmprusi@senate.michigan.gov Sen. Prusi
Senator Ted Kennedy made his first appearance on the Senate Floor since his brain tumor was discovered.
]]>WPS indicated that this ruling has its genesis In the final physician fee schedule regulation published in the Federal Register on November 2, 1999, where the Centers for Medicare & Medicaid Services (CMS) stated that it would implement a policy to pay only the hospital for the TC of physician pathology services furnished to hospital patients. Prior to this proposal, any independent laboratory could bill the carrier under the physician fee schedule for the TC of physician pathology services for hospital patients. At the request of the industry, to allow independent laboratories and hospitals sufficient time to negotiate arrangements the implementation of this rule was administratively delayed. Subsequent legislation formalized a moratorium on the implementation of the rule. As such, during this time, the carriers and, more recently, Medicare Administrative Contractors (MAC), have continued to pay for the TC of physician pathology services when an independent laboratory furnishes this service to an inpatient or outpatient of a covered hospital.
The most recent extension of the moratorium was established by the Medicare, Medicaid, and SCHIP Extension Act (MMSEA). Section 104 of the MMSEA expired on June 30, 2008, thus ending the moratorium.
Michigan Medical Law Report is published by Dolan Media Company. Frank, Haron, Weiner & Navarro was asked to contribute to this prestigious magazine sent to 20,000 practitioners.
Michelle Bayer's article on Internet pharmacies is entitled "They're efficient, but mail-order Internet pharmacies have intricate legal requirements."
Mercedes Varasteh's article entitled "Joint Commission standard fosters collaboration between medical staffs, hospitals" covered the application of MS 120.
Louis Szura wrote on revisions to Section 179 of the Internal Revenue Code in an article, "Economic Stimulus Act offers big tax breaks for health care providers."
David Haron instructed providers on the federal False Claims Act in "Exposing fraud and abuse--what a private citizen may do."
Finally, Melinda Balian and Ross Hammersley gave excellent employment related information in "Employees--your biggest risk and your biggest ally."
Such problems cause significant difficulties for patients. The obvious problem is the loss of the curative properties of prescribed drugs. Less apparent is the effect these unfilled prescriptions have on the efficacy of drugs--that is, when the patients return to their physician for follow-up care--and the previously diagnosed condition has not been alleviated or affected, embarrassed patients often do not advise the physician that the original prescription was not filled. This leads to inaccurate future diagnoses or, worse, prescriptions for more potent dosages--strength that might not have been needed had the original prescription been filled and used. Increased use of some drugs can also lead to immunities and weakening of the efficacy of these drugs.
Why is this happening in America? Why are the drug companies encouraging physicians to write more and more prescriptions--often at higher and higher dosages?
What can be done to encourage and assist patients to fill their prescriptions and to force physicians to follow-up with the patients? One solution is better follow-up calls by physician office staff. Another interesting possibility is office drug drug dispensing using a service/product such as Dispensing Solutions which is legal in all states (with some restrictions in 5 states) and approved by the FDA. More information is available at the Dispensing Solution web-site.
]]>This case raised the issue of whether a physical therapy clinic, incorporated under the Michigan Business Corporation Act, was lawfully rendering services entitling it to reimbursement from its auto-accident injured patient's No-fault insurance carrier.
Allstate Insurance Company argued that a physical therapy clinic-a medical service provider-needed to incorporate under Michigan's Professional Service Corporation Act in order to lawfully render services under Michigan's No-Fault auto-insurance act, even though the physical therapist actually performing the services was a lawfully licensed physical therapist.
The lower courts permitted the claim and the Supreme Court issued its opinion affirming those decisions on July 2, 2008, although not for the same reason the lower courts did.
Essentially, the Supreme Court held that once a corporation, of any sort, files its Articles of Incorporation with the State, it is conclusively determined that the incorporation is lawful--unless the state Attorney General successfully challenges that incorporation in a court proceeding. this conclusion was based on statutory language and the Supreme Court's interpretation of long-standing Michigan law.
I believe the result in this case is correct (although one of the two concurring Justices, Elizabeth Weaver, believes that the Court's tortured logic in reaching the decision was incorrect because of a long-standing battle she has on the Court's Standing decisional process (a topic for some law professor's blog some day))because, as the Court stated, allowing challenges to every corporation in every suit brought by a corporation would affect the very stability of the economy. Every patient would have to verify compliance by every provider with every corporate statute before accepting treatment and whether payment would be made would depend on the creativity of every insurance lawyer in every case when payment decisions were made.
For once, the Supreme Court majority seems to have gotten it right.
Let's see if the Michigan Legislature and the Department of Labor and Economic Growth follow suit and picks up on this decision and clarifies the incorporation requirements as Michael Hamblin of our firm has described on his blog, Michigan Business Lawyer, for peripheral medical and other licensed providers.
Until they do, however, every licensed practitioner and other individuals in Michigan must immediately consult competent health care business lawyers such as my firm, to review their corporate status and to consider re-incorporation as Professional Corporations if permitted and advisable.
HAVE A HAPPY AND SAFE 4TH OF JULY HOLIDAY---AND GOD BLESS AND KEEP OUR TROOPS AND THEIR FAMILIES. LET'S BRING THEM HOME SOON!!!
The petitioners, in my opinion, are well-meaning, but a mandate to the Michigan legislature is doomed to failure. This body is too split by partisan bickering, carried on by inexperienced, term-limited synchophants, to reach a meaningful compromise on such a volatile subject as universal health care. Further, even if they could, the economy in Michigan would never be able to fund such efforts.
Ironically, placement of the petition on the ballot, I believe, would have led to passage where there are some 1.2 million--or more--uninsured Michiganders--and countless other under-insureds. Significantly, the health industry -- the growth engine of Michigan where 1 in 10 Michiganders work (more than twice those directly employed in the auto industry) according to Crain's Detroit Business-- should support a lobbying effort--if it realizes that such a program would mean a million or more new paying customers. Unfortunately, none of the plans on the table in conventional debates will solve the problems with present health insurance by improving health delivery structural deficiencies, the burden on employers and still provide choice to patients and discretion to physicians. I have highlighted a plan which meets all of these objectives in an earlier entry on this Blog--but I doubt it will be debated--it is too logical and efficient.
Nevertheless, the petition effort did keep the dialogue going. Let's hope someone is listening.
The Conference, for state Attorneys General and their assistants and staff involved in state Medicaid anti-fraud enforcement and collection activities provided the following information, in addition to training sessions, to the attendees:
1. A report on the rising level of national cooperation and information, expertise, and skill sharing among MFCU units, and with the Department of Justice.
2. A report on the level of sophistication and training that assistant AGs in all the state MFCU units are receiving at a national level.
3. A report on the involvement of non-Qui Tam States (those without Qui-Tam statutes--about 27) in the fight against health care fraud. They are investing significant investigatory resources and working with relators' counsel with respect to cases that don't even name those states.
Louis will continue his practice in all aspects of litigation, including health care and complex business matters.
]]>The elimination of the cut will be paid for by reducing payments to private Medicare Advantage programs.
Action in the Senate involves drafting a compromise measure that may avoid a White House veto. Senate Finance Committee Chairman Max Baucus (D-Mont.) and ranking Republican Charles E. Grassley (Iowa) may have reached a deal on the compromise.
We will miss him......Maybe this is about health care--every time a comedian dies--we all should feel less happy.
]]>The Amendment brought Michigan into line with 22 other progressive states by adding a Qui Tam provision to the existing Medicaid False Claims Act. According to Wallace Hart, an Assistant Attorney General, actively involved in fraud control, the amendments--giving private citizens the right to bring Qui Tam suits to recover fraudulent monies stolen from the taxpayers by providers treating the Medicaid program as their own private ATM machine--the amendment helped him reduce his in-box.
The Michigan Medicaid False Claims Act prohibits the presentment of any false or fraudulent claim for payment under the Social Welfare Act – namely, for Medicaid benefits. The law currently provides for the State to recover the full amount received by a Medicaid provider due to fraudulent conduct, plus triple the amount of damages suffered by the State as a result of the conduct.
HB 5757, a bill pending before the Michigan Senate after having passed the House in near unanimous fashion, would allow the State of Michigan to recoup extra funds from combined state/federal recoveries because of the provisions of the federal Deficit Reduction Act of 2005 ('DRA"). To explain, shortly after the the Michigan Medicaid False Claims Act amendment passed the Michigan Legislature and Governor Granholm signed the Act, the U.S. Congress passed the DRA providing for a 10% incentive to States which enacted a "compliant" Qui Tam statute addressing Medicaid fraud. Specifically, the Medicaid program is a joint federal/state program. Thus, in Michigan, the federal government pays about 56% and the state 44% of the costs of the Medicaid program and fraud recoveries are divided on the same percentage.
If the state has a "compliant" Qui Tam statute, the state receives an extra 10% of the recovery--that is, 54% in Michigan--of the recovery.
]]> However, on December 21, 2006, The U.S, Department of Health and Human Services/Office of Inspector General ("HHS/OIG") advised the state, by letter, that its Medicaid False Claims Act was NOT "DRA compliant" (that is, a mirror image of the federal False Claims Act).The amended FCA, as presented in HB 5757, would allow the Michigan FCA to become DRA compliant. The small changes made by HB 5757, as required by the federal HHS/OIG., would cost the state nothing a in administrative or other costs and would bring millions of dollars in the future back from Washington.
As I stated during my March 12, 2008 testimony in the House, the State of Michigan has already forfeited $2.1 million in recovery funds to the federal government since December, 2006 (when HHS/OIG notified the state that the Act was out of compliance due to the Michigan FCA’s lack of certain DRA compliant provision.
The amended Michigan FCA would also introduce (as required by Congress) a civil penalties provision to further deter and punish individuals seeking to defraud the State of Michigan. The Michigan FCA ,as it stands now, only allows state recoveries based on the amount of monetary damages that the state actually incurs. A civil penalties provision allows the state to recover from individuals who attempt to defraud the government, but are not always successful. An example of this would be a health care entity that submits fraudulent claims for payment to the Medicaid program, but due to payment “caps” imposed by the program, only half of the claims were paid. The amended FCA would allow the state to recover between $5,000 and $10,000 for the claims that were submitted to the Medicaid program with the intent to defraud the state, but were not actually paid by the government. This civil penalties provision further helps to deter wrongdoers from submitting fraudulent claims for payment.
As a False Claims Act/Qui Tam attorney specializing in health claim fraud, I have personally observed instances where a civil penalties provision would have allowed the state to obtain extra recoveries. My firm is currently involved in a Michigan FCA case where the state’s actual monetary damages were low due to payment “caps” by the Medicaid program; however, the defendant health care entity submitted numerous false claims to the state for payment. A civil penalties provision, such as the one contained in the amended FCA, would have potentially permitted an increased recovery against the defendant.
The HHS/OIG notified the state of the deficiencies in the Act in December, 2006. For political reasons, I believe, tied to the 2007 budget stalemate in the Legislature, Rep. Law, a Republican, was prevented from obtaining Democratic support for the DRA compliant provisions, Rep. Marc Courveau, a Democrat, finally introduced an appropriate bill, HB 5757, in the House, and with my testimony, and support, the bill passed the House without any significant opposition. Unfortunately, it now languishes in the Senate Judiciary Committee, where ,I believe, the Republicans are holding it up for purely partisan reasons.
The partisan activities that have stymied passage of this simple, clarification bill, that is costing the state millions of dollars on, virtually, a daily basis is unconscionable--but, unfortuantely, a fact of life in Michigan and the Michigan Legislature. Both parties are to blame in this fiasco--to go from one of the more progressive states in this area--to one of the most backward; to allow millions of dollars to fritter away from a state in the midst of an economic crisis is unbelievable.
Hopefully, someone will wake up and take the appropriate action in the Senate in short order!!
]]>Although it was a long day for us--storms between Chicago and Detroit kept us on our Northwest Airlines plane for two hours before takeoff (fortunately in Business Class because of frequent-flyer updates, with free snacks and foot room)--we learned a lot and were able to interact with many health lawyers from around the country.
The Conference covered Fraud and Abuse Issues Impacting Physicians, CMS pressure on Medicare expenditures, Physician Joint Ventures and other Alternative Practice Strategies, such as, physician owned hospitals, ASCs, under arrangements, diagnostic and other ancillary enterprises, concierge medicine, insurance opt-out, managed care models and sales of health care products. Other topics included responses to marketplace demands that impact physician practice models, relationships with hospitals, employment models, etc.
Finally, a panel discussed the future FOR Physicians in the face of pressure on costs of and access to health care, demands by both Democrats and Republicans for "universal" health care, hospital mergers, productivity demands, hospital governance changes, increased regulatory demands and other negative influences on the profession--pointing out--as all physicians know--that the majority of physicians are unhappy, angry, resigned, scaling back expenditures and expectations and deeply concerned about the future.
The conference presentations were at a very high level and highlighted the need for physicians and other health care entities to be proactive and to consider their legal and professional relationships before they experience a crisis. While specialists and others in unique and specific practice niches may not have experienced significant reductions in income, most internists, family practice and pediatricians, among others, have and all are certainly aware of the pressures that have been building in the industry. Comfort today can turn into difficulty tomorrow in the face of hospital mergers and acquisitions, exclusive arrangements forcing out smaller practices and entities, "sham privileging" schemes, increasing employment of Hospitalists, and unfair payer practices.
Consultation with legal and professional experts prior to eruption of credentialing confrontations and issues, unfair competition or payer practices and regulatory activities and suspensions can--and will--reduce future costs, aggravation--or worse.
The tone of the sessions--and especially the luncheon address by Catherine I. Hanson, Vice-President and director of the AMA's Private Sector Advocacy and the Advocacy Resource Center on unfair payer practices and the AMA' s 1% Campaign to reduce payer's improper rejections to 1% of billings--presented a somewhat dismal picture of practice and a real need for increased physician organization and participation in the debate.
Nevertheless, Monica and I returned with a renewed interest in assisting our health care clients and in working with them to develop workable practice models in line with the most cutting-edge--and compliant--practice models in operation and contemplated across the country and globe.