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| Dear Friend,
Just in case, anyone needs a reminder, the use of telehealth doesn't immunize against the consequences of prescribing medically unnecessary knee and ankle braces.
If you're still not convinced, consider the story of Mangesh Kanvinde, M.D., of Batavia, Ohio, who, in a civil settlement of allegations of receiving illegal kickbacks and of the filing of false claims for Medicare reimbursement, paid $720,000 and agreed to be excluded from Federal Health Care Programs for fifteen years.
The government's allegations against Dr. Kanvinde share elements in common with the prototypical telehealth/telemedicine scheme in that it was claimed that the doctor had improper financial arrangements with intermediaries, in this case, temporary physician staffing agencies and telehealth companies, that involved kickbacks in exchange for ordering medically unnecessary DME (as well as genetic tests and services) for Medicare beneficiaries with whom he had no physician-patient relationship.
Although without doubt the acts alleged to have been performed between 2016 and 2019 by Dr. Kanvinde occurred well after the enactment of the federal Anti-Kickback Statue and more then 150 years after the enactment of the False Claims Act, you're in a position to be far better forewarned, both because you're reading this and because in July 2022, the OIG issued a Special Fraud Alert on exercising caution when entering Into arrangements with purported telemedicine companies. You can read the full alert on the OIG’s website.
Here, in encapsulated form, is what you need to know:
- These schemes, which abound, exploit the public’s acceptance of remote treatment tech, and purport to use telehealth, telemedicine, or telemarketing services.
- In some of these schemes (for example, see the blog post Greasy Kickback Residue Is All That’s Left of Pain Cream Fraud) the companies intentionally pay physicians kickbacks to prescribe prescription medication. Other schemes involve unnecessary DME, genetic testing, and wound care. All result in fraudulent claims to Medicare, Medicaid, and other Federal health care programs.
- Although the breadth of scams is wide both in type, as mentioned above, and in operation, e.g., call centers, staffing companies, marketers, brokers, etc., the commonality is the use of kickbacks to recruit and reward the practitioners.
- Generally, the telemedicine companies solicit and recruit purported patients and shunt them to practitioners, with the aim of arranging for the order or prescription of medically unnecessary items and services for individuals with whom the practitioners have limited, if any, interaction, and without regard to medical necessity.
- Payments to practitioners are sometimes described as payment per review, audit, consult, or assessment of medical charts.
- The telemedicine companies often tell practitioners that they do not need to contact the purported patient or that they only need speak to the purported patient by telephone.
- Practitioners are not given an opportunity to review the purported patient's real medical records.
- The telemedicine company may direct the practitioner to order or prescribe a preselected item or service, regardless of medical necessity or clinical appropriateness.
- In many cases, the telemedicine company sells the order or prescription generated by practitioners to other individuals or entities that then fraudulently bill for the unnecessary items and services.
The Special Fraud Alert includes a nonexclusive list of telehealth/telemedicine fraud scam characteristics for you to keep in mind:
- The purported patients for whom the practitioner orders or prescribes items or services were identified or recruited by the telemedicine company, telemarketing company, sales agent, recruiter, call center, health fair, and/or through internet, television, or social media advertising for free or low out-of-pocket cost items or services.
- The practitioner does not have sufficient contact with or information from the purported patient to meaningfully assess the medical necessity of the items or services ordered or prescribed.
- The telemedicine company compensates the practitioner based on the volume of items or services ordered or prescribed, which may be characterized to the practitioner as compensation based on the number of purported medical records that the practitioner reviewed.
- The telemedicine company only furnishes items and services to Federal health care program beneficiaries and does not accept insurance from any other payor.
- The telemedicine company claims to only furnish items and services to individuals who are not Federal health care program beneficiaries but may in fact bill Federal health care programs.
- The telemedicine company only furnishes one product or a single class of products (e.g., durable medical equipment, genetic testing, diabetic supplies, or various prescription creams), potentially restricting a practitioner's treating options to a predetermined course of treatment.
- The telemedicine company does not expect practitioners (or another practitioner) to follow up with purported patients nor does it provide practitioners with the information required to follow up with purported patients (e.g., the telemedicine company does not require practitioners to discuss genetic testing results with each purported patient).
The danger to physicians and other practitioners considering participation in these arrangements is that they potentially implicate multiple Federal laws, including the Federal anti-kickback statute (the “AKS”), the Federal criminal law that prohibits knowingly and willfully soliciting or receiving (or offering or paying) any remuneration in return for (or to induce), among other things, referrals for, or orders of, items or services reimbursable by a Federal health care program. Other triggered laws include the Civil Monetary Penalty Law, the criminal health care fraud statute, and the Federal False Claims Act. Penalties range from multi-year prison terms to significant fines to very large civil penalties.
Often lost on physicians is the fact that even though they might not be the moving party involved in the scam, liability falls on both sides of a kickback scheme. In other words, you can be personally liable, criminally and civilly, in connection with these scams, including for submitting or causing the submission of claims.
With lots of money at play, it’s not hard to see why the government is motivated to investigate and prosecute in order to obtain huge fines and the benefit of the forfeiture (generally to the investigating agency) of scores of millions of dollars.
Some final takeaways for you:
Any deal must be structured in compliance with the federal Anti-Kickback Statute, Stark, and various state law counterparts and other restrictions.
Money, big money, is tempting. I know because I’ve counseled many clients in connection with telemedicine “ventures” paying what they must have thought was money from heaven.
Yes, telemedicine has many valid applications. Violation of the AKS and committing fraud are not among them.
And, the money’s not from heaven. It’s from hell.
Let’s talk before you consider any telehealth or telemedicine arrangement. |
| | | 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 version:
I'm stuck in traffic here today, which made me think about slowing down enough to set strategy.
I often talk about the need on the part of medical group and facility leaders to move quickly: To quickly use strategy devices such as the OODA loop to quickly address issues as they arise. To quickly decide what you’re going to do, quickly take action and then reiterate, and reiterate, and reiterate, always building your hypothesis, seeing what’s happening, coming up with an antithesis, and then taking new action.
Yet all of that presupposes that you have some sort of overriding strategy for your group, otherwise, what is this motion that you’re embarking on about, the motion in which you’re observing, orienting, deciding, and acting?
Did you take time to set that strategy?
Did you understand that although you need to quickly iterate as you’re carrying out your strategy, you need to slow down enough to develop a strategy?
Unfortunately, many groups don’t have a strategy, they just have a collection of tactics, one laid on top of the other – the first tactic, second tactic, and so on, and that’s it.
At its essence, strategy is the overall map that's designed to get you where you want to go, which in turn requires that you need to know where it is that you're going.
And, once set, strategy is what keeps you on course, guiding the use of tactics to get there. Are we expanding to other geographic areas? Are we contracting with additional facilities? How does that impact recruiting? How does that impact retirement buyouts? And so on.
But to develop that strategy you need to slow down.
But slowing down simply for a very short period of time, the stereotypical “let’s have a strategy retreat”, is close to useless because those events often lead to a strategy document, which if it were printed out, would just be something to stick on a bookshelf, or maybe you'd use it as a doorstop.
Instead, you need to periodically slow down and apply the same sort of iteration to your strategy. Slow down long enough to observe where you are, orient to the results you’ve achieved, make a decision as to revisions to the strategy, which should not take place as quickly as revisions to tactics, and then re-decide.
There's a bit of a paradox here. You have to be really fast at iterating as you’re moving and deploying tactics, but you certainly need to slow down enough to develop strategy or else your tactics are just motion for motion's sake, with no real destination in mind.
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| | 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 - Why a 59 Year Old Deli Is a Case Study for Your Medical Practice - Medical Group Minute
Watch the video here, or just keep reading below for a slightly polished transcript:
Where's your next meal coming from?
Medical practices, from those of solo physicians to large groups, can’t take that question for granted.
Junior's Deli, an institution on Los Angeles' Westside from 1959 through the end of 2013 was by no means your average deli; rather, it was a breakfast, lunch, dinner and late-night eating spot. It was packed with people doing business deals at breakfast and at lunch, with families at dinner, and with writers and entertainment industry folks late at night. At one point, it served more meals per year than any other restaurant in Los Angeles.
And then, poof, the landlord demanded much higher rent, more than the owner said he could afford, and Junior's was no more. It went from fully packed to all packed up.
Although writing this is making me hungry, this is a post concerning medical groups, not turkey on rye.
Are you in a "Junior's situation?"
That's the risk of an office based practice dependent upon a hospital relationship or single large referral source, or of a hospital-based group dependent upon a single hospital relationship. They've allowed themselves to put their future in the hands of someone or something that can simply terminate that future at will.
The employed physician is laid off by the hospital. The radiology group has its exclusive contract terminated. The large primary care practice hires its own orthopedist and turns off its referrals to you.
As they say in financial services ads, past performance is not a guarantee of future results.
How dependent are you on a single referral source, a single exclusive contact, or, some other disproportionately important third party?
Some medical groups are far better at setting a strategy to protect their future, setting a course to wean themselves of over dependence upon the whims of third parties.
Others – probably most – just keep smiling as they push the keys on the (metaphorical) cash register, just as they did on the actual cash register at Junior's. That is, until the place closed. |
| | | Listen to the podcast here, or just keep reading for the transcript.
You'd think that after spending millions of dollars setting up a foundation model entity to employ physicians, or even going out, in those states without prohibitions on the practice of medicine, and employing physicians directly, that hospitals would want you to succeed.
Well, they do, sort of -- but only to a point.
Historically, physician practice was entrepreneurial. For one reason or another, chiefly related to the complexity of running a practice in today's economy, many physicians have chosen the hospital employment route.
But despite any assurance to the contrary, once within the hospital's bureaucratic model the rules change: You are managed because that is what bureaucrats do.
You'll be free to develop your expertise but not to the point that you will become a star. If you were allowed to become a star, you would obtain leverage and might leave.
There's a tension to have scores of mediocre physicians on the team - entrepreneurial physicians and those striving for personal excellence are too much of a threat.
You'll be paid fairly well, but not above what are actually mediocre levels such as the 75th percentile on employer-favorable surveys. At that level you will be paid more than most, if not all, of the bureaucrats in hospital administration and paying you more will be viewed as "unfair."
Of course, over time, with more physicians being among the employed, the actual dollar amount of 75th percentile compensation will spiral downward. But not as low as that of physician assistants, specialty trained nurses armed with newly minted "doctor" degrees, and other physician extenders who will be used by your employer to muscle you out of a large part of your clinical role.
After all, to the bureaucrats in charge, even those bureaucrats in white coats, it will be done in the name of efficiency.
In a way, it's like the classic Twilight Zone episode, To Serve Man: You might feel that you are participating in something greater, but the reality is that you're on the menu. |
| | | 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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