Health Care Compliance Watch : New York Health Care Compliance Lawyer & Attorney : Ilana Sable : NY Physician Representation Law

Obstetrics practices located in New Jersey and New York can increase revenue and efficiently allocate a substantial portion of their daily patient care by incorporating the services of certified midwives and/or certified nurse-midwives into their practices. Generally speaking, midwives are certified to attend to low risk pregnancies, attend during childbirth and to provide post partum care. Certified nurse-midwives may prescribe certain drugs, as authorized by the licensor-states and as outlined in their governing collaboration and/or affiliation agreements with a supervising physician.

In New Jersey, in order to provide patient care, “certified midwives” are required to enter into a written affiliation agreement with a New Jersey licensed physician who holds hospital privileges in operative obstetrics/gynecology. The affiliation agreement must set forth clinical guidelines that will outline the certified midwife’s scope of practice.

In New York, “licensed midwives” are required to establish and maintain a collaborative relationship with (i) a licensed physician who is board certified as an obstetrician-gynecologist by a national certifying body, (ii) a licensed physician who practices obstetrics or (iii) a hospital that provides obstetrics through a licensed physician having obstetrical privileges at such institution. The collaborative relationship must provide for consultation, collaborative management and referral to address the health status and risks of his or her patients and must include plans for emergency medical gynecological and/or obstetrical coverage.

As with other non-physician practitioners (“NPPs”), obstetrics practices can issue medical bills to commercial payors, Medicare and/or Medicaid for services provided by certified midwives and certified nurse-midwives. Depending on the method by which the midwife services are billed to the insurance carrier (i.e., using the name and national provider identifier (“NPI”) number of the midwife versus the name and NPI of the supervising physician’s as “incident to” the services provided by the physician) the midwife services, on average, will be reimbursed at a rate similar to that which would be paid if the services where performed by a physician. 

The “midwife” license is only offered in a small number of states (New Jersey and New York offer the midwife license). Because these services are payable and reimbursable by insurance carriers and they offer obstetric practices the opportunity to treat patients in an efficient, cost effective, manner without actively utilizing the time and supervising physician(s).

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Health care providers who have been excluded from participation with certain insurance carriers often approach me for guidance concerning their options (if any) for continuing their existing relationships - and possibly treatment – with patients who are insured by the “excluding” insurance carrier. While the reasons for “exclusion” are quite varied and have differing degrees of severity (depending on the particular insurance carrier and type of exclusion that is involved), in almost all cases, exclusion from network participation means that the excluded provider cannot treat patients insured by the excluding insurance carrier, whether directly or indirectly. Provider arrangements made to circumvent exclusion may, among other things, be deemed the “fraudulent practice of medicine” and may carry serious, permanent, consequences for both the excluded provider and any provider assisting the excluded provider with the circumvention.

In the Matter of Josifidis v. Daines, 2011 NY Slip Op 7891 (decided November 10, 2011, Appellate Division, Third Department) the Third Department confirmed a determination of the Hearing Committee of the New York State Board for Professional Medical Conduct (the “Committee”) which, among other things, revoked the medical license of Petitioner Harry Josifidis (the “Excluded Provider”) for the fraudulent practice of medicine. In doing so, the Third Department confirmed the Committee’s finding that the Excluded provider circumvented “his exclusion from insurers’ networks by using another physician’s name.” 

The relevant facts underlying the Third Department’s decision are as follows:

“[The Excluded Provider] was excluded by certain health insurers from being reimbursed as an in-network provider for treatment rendered to their insureds as the result of a prior disciplinary action. [The Excluded Provider] thereafter entered into an agreement with another physician (hereinafter the other physician) by which the other physician’s name appeared on claims submitted to the insurers for [the Excluded Provider’s] treatment of in-network patients.

The Excluded Provider, in an effort to “explain” the legality of the circumvention arrangement, argued that “he relied on the other physician’s representations that their arrangement was ‘lawful and appropriate’” and that “he entered the agreement to provide his patients with continuity of care rather than for profit.”

The Third Department concluded that “[s]ubstantial evidence in the record shows that [the Excluded Provider] repeatedly submitted bills in the other physician’s name for services he had provided in order to receive payment from insurers who had specifically excluded him from being reimbursed for such services…. Accordingly, [the Third Department found] that the Committee properly rejected [the Excluded Provider’s] explanation and substantial evidence in the record supports its determination.”

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For New York State accredited office-based surgery practices (“OBS”), the terms of continued accreditation (varying with an OBS’ specific accrediting agency) often come with strict requirements and guidelines concerning the hiring and retention of employees and independent contractors.  Most unexpected (and often overlooked by OBS employers) are the requirements and guidelines that reach far beyond the customary licensure and/or certification requirements and expand into areas that an OBS employer might consider (understandably) to be “private business decisions” or “matters of professional judgment.” It is in these outlying areas that OBS employers must be well versed in order to avoid inadvertent compliance breaches.

When hiring new employees and/or independent contractors, OBS employers must review their accreditation manuals with a specific focus on the following categories of employees and/or contractors:

(a)          Registered Nurses: when hiring Registered Nurses, OBS employers must confirm, among other things, (i) instances of treatment requiring the presence of a Registered Nurse(s) (including pre and post operative care), (ii) licensure, continuing education and liability insurance requirements, (iii) requirements concerning maintenance of medical records and supporting documentation and (iv) reporting requirements concerning adverse events; 

(b)          Physicians’ Assistants and/or Specialists’ Assistants: with regard to Physicians’ Assistants and/or Specialists’ Assistants, special attention must be give to rules and regulations concerning (i) the presence and/or supervision of a physician at the OBS facility, (ii) availability of and/or access to a physicians upon request of the patient, (iii) maintenance of medical record, auditing and quality control initiatives, (iv) licensure, continuing education and liability insurance and (v) reporting requirements concerning adverse events;

(c)           Anesthesiologists: in addition to the state and federal laws concerning and/or affecting financial and work relationships among physicians (i.e., Stark Laws, Anti-Kickback Statutes, False Claims Act), OBS employers must review all rules and regulations concerning: (i) the Anesthesiologist’s access and availability to patients, (ii) pre and post operative care directives, (iii) directives concerning maintenance and support of Anesthesia equipment, medication and/or supplies, (iv) maintenance of medical records, auditing and quality control initiatives, (v) board certification, licensure, continuing education, and liability insurance and (vi) reporting requirements concerning adverse events;

It is important to note that most of these “employment requirements” can be outlined as conditions of employment in an employment contract or independent contractor agreement between the OBS employer and the employee/contractor.  Documenting and outlining relevant accreditation-mandated employment requirements, in addition to clarifying the potential employee/contractor’s responsibilities and obligations, demonstrates a good faith effort to comply with all applicable accreditation mandates and delegates applicable accountability. 

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Under the Office-Based Surgery Law, enacted in 2007, all New York State medical practices that perform invasive procedures and surgery requiring more than mild sedation were required to obtain accreditation by a nationally recognized body designated by the Commissioner of Health no later than July 14, 2009.

Currently, accreditation is available through the following agencies:
• Accreditation Association for Ambulatory Health Care (AAAHC)
• American Association for Accreditation of Ambulatory Surgery Facilities, Inc. (AAAASF)
• The Joint Commission (TJC)

For those practices that did not receive accreditation by the July 14, 2009 deadline (even if an accreditation application was filed prior to the deadline), procedures involving moderate or deep sedation or liposuction involving the removal of 500 cc of fat or more cannot be performed until the accrediting agency has conducted an inspection and found the practice to be in compliance with the accrediting agencies office-based surgery standards.  Unaccredited medical practices that perform office-based surgeries falling under the scope of the Office-Based Surgery Law after July 14, 2009 should bear in mind that they are at risk of being found guilty of professional misconduct.

For an up-to-date list of accredited Office-Based Surgery practices in New York State, please visit the NYS Department of Health website.
 

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After spending a few days absorbing the newly issued Office of the Medicaid Inspector General (“OMIG”) regulations regarding NY State provider compliance programs, I am wondering what the term “Medicaid Providers …” includes.

It is clear that providers who meet the $500,000 minimum simply by billing directly to Medicaid are subject to the regulations, but what about those providers who devote a significant portion of their practice to patients enrolled in Medicaid managed care programs. Most Medicaid eligible people residing in mandatory counties are required to join a managed care health plan, and are therefore utilizing Medicaid benefits through an alternative means. However, the problem is that often times providers cannot distinguish which of their managed care patients are Medicaid recipients.

For example, in Kings County, New York, Medicaid managed care plans are available through managed care providers such as:

• GHI HMO
• Metroplus Health Plan
• Neighborhood Health Providers
• United Healthcare of New York

These managed care plans offer coverage to the general public, as well as Medicaid recipients, thereby making it very difficult for providers to determine when they are providing services to Medicaid recipients.

Furthermore, managed care generally covers most of the benefits recipients will use, including all preventative and primary care, inpatient care, and eye care. Therefore, it is likely that many New York State providers will fall into a category where they meet the $500,000 minimum set by the OMIG simply by providing services to patients enrolled in Medicaid managed care programs. New York State providers are strongly encouraged to further investigate, and prepare for, this possibility.

Whether or not a provider falls into a category of “Medicaid Provider,” as defined by the OMIG, it is highly advisable for all providers to draft and implement a comprehensive compliance program for their practices. At minimum, these programs will ward off potential privacy breaches, detect and prevent improper billing, and educate and train employees in regulatory compliance. The reward will certainly outweigh any investment of time, money and personnel.
 

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On January 14, 2009, the New York State Office of the Medicaid Inspector General (“OMIG”) adopted regulations stating that New York State providers of care, services and supplies for which the Medicaid program constitutes a substantial portion of their business operations are required to adopt and implement effective compliance plans.

The OMIG defines “substantial portion” of business operations to mean any of the following:

1. a person, provider or an affiliate of the provider claims or orders, or has claimed or has         ordered, or should be reasonably expected to claim or order at least $500,000 in a consecutive twelve-month period from the medical assistance program;
2. a person, provider or an affiliate of the provider receives or has received, or should be reasonably expected to receive at least $500,000 in any consecutive twelve-month period directly or indirectly from the medical assistance program; or
3. a person, provider or an affiliate of the provider who submits or has submitted claims for care, services, or supplies to the medical assistance program on behalf of another person or persons in the aggregate of at least $500,000 in a consecutive twelve-month period.

The OMIG regulations also state that the mandatory compliance programs shall be applicable to:

• billings;
• payments;
• medical necessity and quality of care;
• governance;
• mandatory reporting;
• credentialing; and
• other risk areas that are or should with due diligence be identified by the provider.

The OMIG regulations are in line with previous compliance guidance offered by agencies such as the Department of Health and Human Services. Specifically, the OMIG requires that required providers’ compliance programs shall include the following elements:

1. written policies and procedures;
2. designation of a compliance officer;
3. training and education of all affected employees and persons associated with the provider;
4. communication lines to the compliance officer;
5. disciplinary policies to encourage good faith participation in the compliance program;
6. a system of routine identification of compliance risk areas;
7. a system for responding to compliance issues as they are raised; and
8. a policy for non-intimidation and non-retaliation for good faith participation in the compliance program

In the future, the OMIG is expected to issue specific compliance program guidelines for certain types of required providers.

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