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| | Dear Friend,
Here's the latest on another whistleblower lawsuit in connection with the "company model" of anesthesia services.
Tenet Healthcare Corporation’s most recent quarterly report (for the period ended 9/30/19) indicates that it’s reached an agreement in principle with the United States Department of Justice to settle a whistleblower suit involving, among other serious allegations, that it participated in a so-called “company model of anesthesia services” scheme. That’s an arrangement in which, roughly speaking, the surgeons working at a facility, usually owners of the facility, and perhaps the facility itself, own the entity providing anesthesia services.
The cost of the settlement? Tenet’s 10-K filing states that it’s $66 million with another $2 million reserved for the relator’s attorneys fees and other costs.
The lawsuit, entitled U.S. ex rel. Wayne Allison, etc., et al. v. Southwest Orthopaedic Specialists, PLLC, et al., centers around numerous Oklahoma orthopedic surgeons, their practice, Southwest Orthopaedic Specialists (“SOS”), the surgical hospital they created, Oklahoma Center for Orthopaedic and Multispecialty Surgery (“OCOM”), and the corporate entities that purchased and/or control the surgical hospital, Tenet Healthcare and its subsidiary, USPI.
Among other things, the lawsuit alleges that SOS and other defendants, including Tenet and USPI, entered into an anesthesia company scheme under which they formed and operated an entity called Anesthesia Partners of Oklahoma, LLC, to which OCOM granted the exclusive anesthesia contract. The complaint alleges that, as a result, anesthesia company profits were distributed to those owners in a manner directly related to the volume and value of referrals by the SOS surgeons.
These allegations are of additional interest because they’re not along the traditional line of company model scheme attack. The common attack involves an allegation that there’s an inherent, forced kickback in the relationship between the surgeon or facility-controlled anesthesia company and the anesthesiologists and/or CRNAs it employs or engages.
The lawsuit states that Tenet, through USPI and other subsidiaries, owns 22 companies holding interests in anesthesia companies, claimed to be set up via a boilerplate “kit” of documents supplied by the Tenet-related entity.
Although it must be stressed that Tenet is settling the case, certainly without any admission of liability, $66 million is no small chunk of change.
A similar amount could destroy many facilities, including nearly any ASC that directly, or through their control physicians, that sponsor similar anesthesia company deals.
Here are some additional takeaways for you:
1. Just because a large entity, for example, a hospital or a surgery center management company, tells you that a deal’s been vetted by their lawyers and is “legal,” don’t bet on it. Vet it through your own counsel and assess your own risk. As in carpentry, measure (assess) twice, cut (do the deal) once. Or not do the deal – you get the idea.
2. I’ve written, many times before (see, for example, How to Build a Whistleblower and Hospital Chain Paying More Than a Quarter Billion Dollars to Resolve False Billing and Kickback Allegations), false claims act lawsuits often arise from an insider. In the instant case, the relator, Mr. Allison, was the administrator of SOS, the surgical practice, that is, until he was fired.
3. Last, and quite interesting, is the fact that there are at least several anesthesia companies, some working nationally, and some surgery center management companies, that appear to engage in “cookie cutter” anesthesia company arrangements as a part of their overall business plan. Each of those arrangements is clearly now a target for false claims act action, likely via claims brought by insiders such as administrative personnel or anesthesia providers, or outsiders, such as billing service employees. Only time will tell what transpires. |
| | Tuesday - Success in Motion Video: Inspiration Needed
Watch Tuesday's video here, or just keep reading below for a slightly polished transcript: |
| A couple miles back, I passed a church spire which made me think of the word, the Latin word, “spirare,” to breath. It’s the root of the English word “inspire”.
In turn, that caused me to think about a physician I spoke with a couple weeks ago - not a client, just a general conversation. He was talking about the fact that his group was stagnant. It hadn’t grown in decades – the same number of physicians, the same number of facilities served.
It’s sort of the same-old "same-old." Simply hanging onto their referral relationships, and simply hanging onto their facility contracts -- that’s the problem for them. Their strategy is purely defensive. They’re just trying to protect what they have, in essence to build walls around their existing business, which obviously is not a very good strategy for the future.
So let’s get back to “spirare”.
You know we’re said to be inspired by some idea, and to have aspirations – both of those words being related to spirare, inspiration being something like “to breathe into”; I guess we would say “to breath life into.” And what we breathe life into are our aspirations, things that we’re aiming for, things that we are creating.
But without an inspiration to become, in essence, more than we are now, and in this case, more than your medical group is now, then we’re simply stuck with that game of playing defense.
So what inspires you? What can you do to develop some inspiration for the growth of your group? To what can you aspire?
Because if you don’t do those things, then you're simply left with the other spirare word in English, one that’s very familiar to you: Expire.
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| | Wednesday - Medical Group Minute Video: Why You Need to Adopt the Contingency Mindset
Watch the video here, or just keep reading below for a slightly polished transcript:
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| Have you considered the impact of contingency fee thinking on your business?
No, not contingency fees in the sense of a personal injury or a med mal lawyer. And no, not contingency fees in the sense of the type of contingent and blended fee deals that I do on transactions with clients from time to time. But about you working on a contingency fee basis . . . at least in terms of how you think.
How would you run your business if every patient or referral source or facility relationship paid off for you on a contingency basis only?
No fees per unit. No fees per visit. No monthly stipend support. No, well, anything, except for payment at the end, conditioned upon a successful outcome, whatever “success” means in the particular context.
If that were indeed the case, how would you organize things differently? How would you structure your practice, your facility, your group, your governance, your contracts?
This puts you in an incredibly different mindset, a very powerful mindset.
It seems simple. It seems like it is a game, but think about it, because the reality is that you are on that contingency basis. Referral sources could leave you and facilities can terminate your contract. Patients could walk for someone across the hall or across town.
So think about it: How would you reorder your business, your practice, and your relationships, if the only way that you got paid was based on a successful outcome?
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| | Thursday - Podcast: History Rhymes in Healthcare Just as it Does in Home Delivery Services: Ride the Trend |
| Listen to the podcast here, or just keep reading for the transcript
I read an interesting blog post about the fact that we tend to think we live in such modern times, when, in many cases, what we see as new is simply the repeat of a prior trend. The current instance may not be the same technologically, but, at its heart, it’s one and the same concept.
For example, we think that it’s very modern to have meals prepared remotely and then delivered to us at home. And, we think that it’s wonderful that now everything can be delivered to us via merchants such as Amazon or Jet.
But as that blog post pointed out, in the mid-1800s London, eating out was what people did. Even the relatively poor didn’t eat at home. That’s because it cost more to cook at home. Additionally, most people lived in apartments and most apartments didn’t have kitchens. Instead, apartments had a fireplace, which was sometimes used to heat a pot over some coals, but that required fuel (which was expensive) and it required time.
So, what developed was a culture in which even the poor ate at roadside stands, and in which even the working class could afford to have meals delivered: not only the food, but also the plates and utensils, just like home delivery catering today, but for the masses.
The same thing was true in mid-1800s London in terms of ride sharing. Most didn’t own carriages because they were very expensive. Instead there was a plethora of other ways to share rides – from horse-drawn buses and cabs to other shared coaches.
Londoners of the time also had shopping come to them. There weren’t any department stores, so vendors would travel from door to door, selling and delivering their specialties.
While history may not repeat itself, it’s been said that it sure does rhyme.
Trends (in one direction and then a reversal, and so on) are prevalent in healthcare, too.
As I describe in The Impending Death of Hospitals, healthcare was originally delivered in the home.
The notion of public hospitals didn’t exist in the U.S. until the mid-18th century when Dr. Charles Bond and Ben Franklin formed the first public hospital because the poor didn’t have homes in which to receive care.
The “hospital trend” is now reversing itself, with hospitals losing favor both in terms of their attractiveness to patients and payors. Instead, the care setting is trending toward surgery centers, other freestanding facilities, and even the home.
These trends ebb and flow like men’s ties move from wide to narrow.
Some few will be able to buck the trend. Some few will be able to devise a counter-trend as a way to distinguish themselves from other competitors.
But for most, the opportunity is to be found in riding the trend: How will you take advantage of the movement of care to sites outside of the hospital?
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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 here.
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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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