| View this email online if it doesn't display correctly |
|
|
|
| |
Dear Friend,
Kickbacks and more kickbacks.
When most people think of kickback schemes in the healthcare context, they immediately go to notions of payments to physicians for referrals.
Now, that’s not an unwarranted assumption because, unfortunately, much of the history of the application of the federal Anti-Kickback Statute involves physician-referral issues.
Within large medical groups, and similarly within physician-owned facilities such as ambulatory surgery centers, exactly what your employed, subcontracted and affiliated physicians are up to is a matter of concern, both directly, as in potentially tainting the entity itself, and indirectly, in terms of what can be horribly adverse publicity.
But there’s another twist entirely, one that’s, unfortunately, tremendously common in other industries and becoming prevalent in healthcare, too.
That’s the activity of non-physicians, specifically administrators and even rank-and-file administrative personnel, especially those in purchasing and accounting positions, who run scans within the confines of your practice or business.
What appears to the unknowing and unsuspecting to be a normal day-to-day business transaction is really something quite different.
Let’s start with a quick story from the non-healthcare context.
Sally, not her real name, was the bookkeeper at a significant-size manufacturing company. Highly efficient (but as it turns out, not highly efficacious) she paid all invoices on a timely basis keeping vendors happy to deliver quick, timely and even last-minute (no problem!) services and supplies.
The problem? Well, several of those quickly paid vendors never actually delivered anything to the company. They were shell entities controlled by Sally. Oops.
In similar fashion, earlier this year, John Davis, the former CEO of what became a defunct 21-office Tennessee pain clinic practice, Comprehensive Pain Specialists, was convicted of federal Anti-Kickback Statute violations in connection with a scam in which he encouraged practice employees to make DME referrals to an entity which kicked 60% of the profit back to him via a shell company.
Ferreting out, as well as preventing, fraud in businesses across the board involves a combination of enforcing business methods and regular compliance auditing.
Although many of the notions are similar, in healthcare, from medical practices to ASCs to labs and other facilities, the issues are far more complex.
A significant amount of the compliance auditing crosses over from “simple” business process and financial concerns to the way that impropriety results in civil and, potentially, criminal liability for the entity, both at the state and federal levels.
And, in healthcare, as was apparently the case in the Davis affair, medical practices and facilities have the additional concern that internal schemes might attract federal prosecutors.
What appears to be normal might not be. Unless you regularly engage in broad compliance audits within your practice or facility, you might not find out. That is, until it’s too late.
Be diligent.
|
| | Tuesday - Success in Motion Video: Does Your Medical Group's Governance Need Reform School?
Watch Tuesday's video here, or just keep reading below for a slightly polished transcript: |
| | I want to talk with you briefly about medical group governance and whether it might need some reform, what I jokingly refer to in the title of this post as “reform school.”
Off the top I want to say that I am not assuming your medical group is broken. What I am assuming is that, no matter how it’s structured, there’s room for improvement of its governance structure.
Here’s the point in a nutshell: No matter how your group is structured, whether it’s structured as a partnership of limited liability entities, whether it’s structured as a professional association, a medical corporation, or so on, it has, whether by design or by default, a governance structure. Governance structures can vary from what I call the “strong leader” set-up in which one person is charged, basically, with running the group, a sort of benevolent dictator, all the way to a board structure, a corporate structure whether it’s a corporation or not, with members electing a board, whether it’s a board of directors or a management committee, perhaps also a managing partner in that structure. There’s lots of ways of structuring things.
But really at the heart of all this is whether those who are leaders are empowered to actually lead, or whether they are hobbled, either by rules or by group culture into a situation in which voting across a large number of people is required, or consensus among a large number of people is required before even, for example, a strong leader can take action.
What that results in is gummed-up governance because the group can’t respond to threats, it can’t even respond to questions, say from a hospital with which it has a contract concerning some new contract provision, perhaps a new offer from the hospital to cover another facility, without significant delay.
It also hobbles the group in terms of taking proactive action, because when you turn to a group for consensus, you’re already starting out with a watered-down decision, or perhaps fear among too many that taking on, for example, new responsibilities might threaten them in one way or another.
The whole process starts with a governance audit. Again, I’m not assuming you’re broken, I’m assuming you can get better, more efficient, and more importantly, more effective.
|
| | | Wednesday - Medical Group Minute Video: Why It's Easy to be Knocked Off Course
Watch the video here, or just keep reading below for a slightly polished transcript:
|
| They say that a journey of 1,000 miles starts with a single step.
Note that the saying doesn’t discriminate between heading in the right direction or the wrong direction.
This is certainly true of the steps taken a connection with a medical group’s relationship with payors, hospitals, referral sources and patients. Each movement along the business road involves small decisions. A few small missteps don’t deter from reaching an ultimate desired destination – as long as you quickly realize that they are steps in the wrong direction and then make corrections.
But allowed to continue unchecked, small, discrete errors have a multiplier effect, quickly taking you off your course to, say, business San Francisco, sending you to business San Marcos.
Check your compass often, taking stock of the direction you’re headed in. You might believe, for instance, that the only important provision in a payor agreement is the rate, only to be surprised a year later when you’re not being paid, the effect of which multiplies to the inability to retain staff.
|
| | Thursday - Podcast: Medical Group Mergers: Making 1 + 1 = 3 |
| Listen to the podcast here, or just keep reading for the transcript
When I was a kid, there was a new method of teaching math that was heavily marketed to our parents. It was called the “new math.” It was supposed to make it a way for math to be more easily understood by students.
We kids joked that “new math” was going to make 1 plus 1 equal 3.
As funny as we thought that was, in math class 1 plus 1 never made 3. But, despite our teacher’s inability to conceive that it ever could, in the domain of medical group mergers 1 plus 1 can equal 3. In fact, it should or there’s a large chance the deal shouldn’t be done.
Now when I say “merger” I don’t necessarily mean merger in the true legal sense, although it could be. It could be an acquisition. But in general, I’m focusing on the peer-to-peer combination of medical groups as opposed to a deal in which a local medical group is flat out being acquired by a national practice, whether or not financed by outside investors.
And, by 1 plus 1 equalling 3, I mean that when you structure a merger or evaluate a merger partner, you want to avoid a merger that is merely additive, one that takes 1 plus 1 and gives you 2.
The better approach is to bring on a merger partner that takes the 100X that you’re currently doing plus the 100X that they are currently doing, and which, when combined, results in 300X or even more.
Now, of course, I’m not talking simply about gross revenues all of a sudden making some sort of magical, mystical, metaphysical jump.
What I am talking about is the creation of additional value whether it has to do with the fact that it changes the way you can contract, whether it changes the way that payers look at you, whether it brings on skills that are much easier bought than homegrown, or whether it means expanding into a new geographic area in a way that is far less expensive than by organic growth.
To be truly valuable, to be truly powerful, to be truly rewarding, look for that new math.
Look for deals where one plus one actually does equal 3.
|
| | | | 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
|
|
|
| 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 here.
|
| | | | 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. |
| | |
|
