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| Dear Friend,
Another day, December 8, 2021, to be exact, another $4.2 million.
That's the subject of this past Monday's blog post, Allegations Punch ENT in the Nose. He Sinuses Off on Multi-Million Dollar Settlement. Follow that link to the blog or just keep reading for the rest of the story:
That's the settlement the government will receive in total from an ENT, Jeffrey M. Gallups, M.D., the founder, owner, medical director, and past-CEO of Georgia-based Milton Hall Surgical Associates (“MHSA”) a/k/a The Ear, Nose & Throat Institute, and medical device maker Entellus Medical to settle kickback allegations in violation of the federal Anti-Kickback Statute.
Originating from a whistleblower suit filed by a former MHSA physician, the government alleged that Dr. Gallups received kickbacks from Entellus in various forms including cash and all-expense-paid trips, in return for Gallups requiring MHSA’s dozen-plus physicians to use Entellus’s sinuplasty medical devices and to increase the number of sinuplasty procedures conducted on patients (and, therefore, increase the volume of Entellus devices sold).
Although allegations are simply allegations, and in resolving them there was no admission of culpability, Gallup agreed to pay $1.2 million, and Entellus (through its new owner, Stryker Corporation) agreed to pay $3 million, to resolve the civil case.
Interestingly, the same settlement resolves civil allegations against Gallups that he also entered into a kickback arrangement with NextHealth, LLC, a now-defunct medical testing laboratory. Pursuant to the government’s claims, Gallups directed MHSA physicians to order toxicology and genetic tests from NextHealth over physician objections that the tests were not medically necessary. Gallups allegedly received 50% of NextHealth’s revenue from the ordered tests.
And, although the settlement involving Dr. Gallups discussed above relates to civil claims, on October 21, 2021, Dr. Gallups pleaded guilty to health care fraud, that is, criminal allegations, relating to NextHealth.
Some Takeaways For You
- Kickbacks are big business, both for those paying and collecting them, but also for the government.
- Civil allegations, whether or not arising from whistleblower claims, make the government a dollar-on-dollar return that makes Warren Buffett look like a beginner.
- Civil allegations can be settled, but doing so rarely involves the resolution of potential criminal allegations. You can pay up in dollars and then pay up later with time, time behind bars, that is.
- Yeah, I have a dog in the race, but get competent legal advice before agreeing to get anything of value, including a discount, from someone or some entity with whom you do business or with whose business you can impact referrals. You don’t want to gallop down the same road as Gallups, do you?
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| | | Business Life in the Time of Coronavirus Mini-Series
The coronavirus crisis caused a short term economic crisis for many medical groups. Our mini-series shows you the way out. Plus, many of the concepts discussed are applicable during both good times and bad.
[If you haven't already seen them, follow this link to watch our entire series.] |
| | Watch Tuesday's video here, or just keep reading below for a revised, more polished transcript:
You’ve just been presented with a contract.
There’s a provision in it that you think is clearly unenforceable.
Let's play with some examples.
Perhaps it’s a covenant not to compete in an employment agreement for a job in a state in which covenants not to compete are unenforceable.
Or, let’s get more slippery and say it's a non-solicitation agreement between your entity and another entity in a subcontract pursuant to which your company is providing services.
Should you agree to leave that provision in the agreement because after all, you think, it's clearly unenforceable?
Maybe.
But maybe not, because here’s the problem: what if you’re wrong?
What does it cost you to prove that you’re right?
What if the other side holds your feet to the fire and you get a judge (at a trial) or even worse, an arbitrator (in an arbitration) who thinks it’s enforceable?
In the judge context, you could appeal – but could you afford to appeal?
In the arbitrator context, depending on what sort of arbitration you've agreed to, there may be no ability to appeal.
Just because a provision is “clearly unenforceable” doesn’t always mean that for you, it won’t be enforced.
Think clearly and carefully. Weigh those provisions. What would happen if they were to be enforced? |
| | How to Deploy the Secret Sauce of Opportunistic Strategy
Webinar On Demand
They say that COVID-19 has changed the world, creating the "new normal." Many of your colleagues and many hospital administrators are running scared.
Others, leaders like you, know that crisis means opportunity.
Let me provide you with the strategic tools and insights that you need in order to seize opportunities, whether they’re in the context of your current business relationships, the expansion of your business activities, or the creation of new ventures.
You will learn:
•Defense as a defective default: It’s necessary, but not sufficient.
•Exploiting weakness: Drop the guilt and identify opportunity.
•Flat line negotiation is fatal: Understand its myths and limitations.
•Negotiation reality: Learn to identify and deploy on multiple planes to affect the outcome.
•Maneuver: Harness the power of maneuver, both in overall strategy and in specific negotiation strategy.
Others see a crisis and freeze in fear. Learn how to see the opportunities and obtain the tools to increase your odds of obtaining them.
The price to attend is $479. The cost of not attending is astronomical. |
| | | Wednesday - Physician Discontent with Hospital Employment Beginning to Boil - Medical Group Minute
Watch the video here, or just keep reading below for a slightly polished transcript:
Perhaps it’s only anecdotal, but the several hospital executives and well-connected hospital-affiliated physician group leaders I’ve spoken within the past few weeks tell the same story: a spate of resignations by hospital-employed physicians.
Yet, at the same time, the healthcare industry press reports that more than half of the country’s physicians practice in hospital-affiliated groups. Perhaps that’s the problem.
Certainly, as the size of hospital-employed physician groups has grown, bureaucracy has increased. The stories of broken employment promises, the use of “quality” as an excuse for the reallocation of funds away from physician compensation, and so on, are leading to increasingly disgruntled physician employees.
This, at the same time that CMS (e.g., as in their several proposed regulations released July 29, 2019) (1) keeps expanding the list of procedures that can be performed, that is performed and reimbursed, in ambulatory surgery centers, (2) demands (high) price transparency on the part of hospitals, and (3) continues to recommend the reduction in rates paid to hospital outpatient departments, with the ultimate goal being parity with ASC fee schedule rates, which will be, for all intents and purposes, the end of the hospital outpatient department.
So what does this mean for you?
Most of my clients are not hospital employees. They are large groups or highly entrepreneurial physicians who see these changes in the overall market as rocket fuel for their success.
There are tremendous opportunities to gain patients lost in the shift of physicians leaving hospital-affiliated groups. Many of those patients are already themselves upset by the bureaucracy of hospital-affiliated practices and, especially, by the revolving door of medical care. They, too, are increasingly unhappy with hospital-centric healthcare. Yet, many of the physicians that those patients might follow outside of the hospital system will be unable or unwilling to take the entrepreneurial leap and thus pull their patients with them. Those “employee minded” physicians will be on the hunt for new jobs, too, with regular paychecks and little to no desire to ever become partners.
Additionally, the trend continues to show that surgeons as well as physicians performing what some might call “surgery-like” procedures but which are, for all intents and purposes, surgery, that is, interventionalists, for example interventional radiologists and interventional cardiologists, should all be considering the development of, or investment in, outpatient facilities, that is, in ambulatory surgery centers.
And, hospital-based physicians, certainly anesthesiologists and radiologists, must significantly expand their scope to include outpatient facility based practice. If not, the number of cases remaining within the hospital setting will require a vastly different way of staffing (i.e., fewer physicians) and of organizing your group.
Change is in the air. For most that means the smell of fear. But for others, it’s the smell of opportunity. |
| | | Listen to the podcast here, or just keep reading for the transcript.
Hospital-based medical groups shouldn't simply conceptualize their practice as one business.
If you're a medical group leader, you must view your practice as consisting of several independent, yet coordinated, units, each of which requires a separate focus.
So, for example:
- There is a group owner unit
- There is an employee/subcontractor unit
- There is a hospital unit
- There is a referral source unit
- There is a patient unit
Then within each of those units there are multiple elements of required activity.
Finally, each of those elements are valuable only if they are working in coordination and within the scope of the group's master business strategy. |
| | | Calibrate Your Compass
Read our exclusive RedPaper to guide you through this evolving situation.
The coronavirus crisis caused a short-term economic crisis for many medical groups. Our RedPaper shows you the way out. Plus, many of the concepts discussed are applicable during both good times and bad.
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| | Help Us Help You With Helpful Content
What tailored content would you most like to see during this
time? How can we focus on solutions to your most pressing strategic concerns?
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| | | | We all hear, and most of us say, that the pace of change in healthcare is quickening. That means that the pace of required decision-making is increasing, too. Unless, that is, you want to take the “default” route. That’s the one is which you let someone else make the decisions that impact you; you’re just along for the ride. Of course, playing a bit part in scripting your own future isn’t the smart route to stardom. But despite your own best intentions, perhaps it’s your medical group’s governance structure that’s holding you back.
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| In fact, it’s very likely that the problem is systemic. The Medical Group Governance Matrix introduces a simple four-quadrant diagnostic tool to help you find out. It then shows you how to use that tool to build your better, more profitable future. Get your free copy Free.
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| | | | Whenever you're ready, here are 4 ways I can help you and your business:
1. Download a copy of The Success Prescription. My book, The Success Prescription provides you with a framework for thinking about your success. Download a copy of The Success Prescription here.
2. Be a guest on “Wisdom. Applied. Podcast.” Although most of my podcasts involve me addressing an important point for your success, I’m always looking for guests who’d like to be interviewed about their personal and professional achievements and the lessons learned. Email me if you’re interested in participating.
3. Book me to speak to your group or organization. I’ve spoken at dozens of medical group, healthcare organization, university-sponsored, and private events on many topics such as The Impending Death of Hospitals, the strategic use of OIG Advisory Opinions, medical group governance, and succeeding at negotiations. For more information about a custom presentation for you, drop us a line.
4. If You’re Not Yet a Client, Engage Me to Represent You. If you’re interested in increasing your profit and managing your risk of loss, email me to connect directly. |
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