After a decade of complaining that federal officials wouldn't give them legal guidance on whether their business transactions violated federal fraud-and-abuse statutes, providers got their wish last month.
On Feb. 21, new regulations issued by HHS' inspector general's office took effect, offering providers an opportunity to voluntarily seek advisory opinions from the agency on the legality of proposed deals.
But so far, the mad rush for directions from the inspector general's office hasn't materialized. In fact, there has been only one nibble: a request for an advisory opinion that was withdrawn before it was even formally logged in by HHS, an agency spokeswoman said.
One reason for providers' shyness may be the agency's insistence that it cannot assure proprietary information included in the request will remain confidential.
Heidi Wagner Hayduk, a McLean, Va., healthcare consultant, said the possibility of HHS disclosing confidential information will keep some providers from seeking guidance. "I think providers will think twice about sending in information if (HHS) is going to give it out," Hayduk said.
But attorney Sanford Teplitzky said that while the confidentiality issue does have some providers concerned, he still believes there will be requests for opinions in due time. "It was only the (inspector general) who said there would be thousands of these and they would never be able to handle the volume," he said. "The industry never said that."
Teplitzky, with the Baltimore office of Ober, Kaler, Grimes & Shriver, has been a vocal advocate of advisory opinions for years.
Last year's health insurance reform legislation, known as the Kassebaum-Kennedy bill, required HHS to issue rules for the advisory opinion system. Under the system, the agency will determine whether a proposed business deal would violate the anti-kickback provisions of the 1977 Medicare and Medicaid criminal fraud-and-abuse statutes. The provisions bar any form of remuneration to induce patient referrals.
In 1987, Congress made violations of the statutes a civil offense with less severe penalties, and providers have been pushing for advisory opinions ever since.
Under the new rules, HHS will review only transactions that have occurred or for which the parties can prove their intention to proceed. HHS' legal opinions will apply only to the deal outlined in the request.
But there are several hitches.
In addition to no promise of confidentiality, the Clinton administration has opposed the advisory opinion system and will seek its repeal in its soon-to-be-unveiled legislative package of new fraud-fighting proposals.
Because of that, providers have been concerned that HHS will either stall the process and make it difficult to get an advisory opinion or simply not issue opinions in a timely fashion.