Hospitals will have much greater legal latitude to recruit and retain needed physicians under a new set of so-called "safe harbor" regulations released by HHS' inspector general's office last week.
The new rules will allow hospitals to form joint ventures with physicians in underserved areas and offer them financial perks such as recruitment bonuses and subsidies for malpractice insurance premiums.
The benefits of attracting physicians to underserved areas outweighs the risk of improper inducements, according to the inspector general's office.
"The joint-venture safe harbor would give a lot of hospitals that normally would not be able to purchase new equipment the capital to do it-if they can find willing (physician) partners," said Harley Smith, administrator of 135-bed Miller County Hospital in Colquitt, Ga. "It's always a help when the government gives you the leeway to do your job better."
Previously, such deals with physicians violated the anti-kickback provisions of the Medicare and Medicaid fraud-and-abuse statutes. Those provisions bar any form of remuneration to induce the referral of Medicare or Medicaid patients. That meant any financial arrangement between a hospital and physician could be called into question if the result was the referral of the physician's patients to the hospital.
But now hospitals and other healthcare providers have 10 additional exceptions to that risk under final regulations published in the Nov. 19 Federal Register. They join a list of 13 existing safe harbors defining business arrangements that won't violate the anti-kickback statutes.
During an unveiling of the new safe harbors at a press briefing in Washington last week, D. McCarty "Mac" Thornton, chief counsel to the inspector general, singled out a new provision concerning ambulatory surgery centers as being of particular help to providers.
The new safe harbor protects the investment interest of physicians for whom the center is an extension of their office practice. For example, a group of gastroenterologists can invest in a surgery center they use often for outpatient procedures. Likewise, a mix of surgeons and gastroenterologists can invest in a surgery center under similar circumstances.
Hospitals may own surgery centers with physicians but must not be in a position to make or influence referrals to and from the center.
Previously, that safe harbor existed only for freestanding centers owned by surgeons.
In addition to the 10 new safe harbors, the inspector general clarified six of the original safe harbors published in 1991.
The most notable of those clarifications concerned discounts for healthcare goods and services. Medicaid and Medicare must share in the discounts where appropriate.
The clarifications and new safe harbors have been in the works since 1994, but it's taken five years to get them out in final form.
"Before (the Health Insurance Portability and Accountability Act was passed in) 1996, we had a very lean staff and not enough resources to get them out sooner," he said. "Then we saw that the healthcare marketplace had changed, and we wanted the safe harbors to reflect that."
Although the new safe harbors are final, providers will have an opportunity to comment on them at the end of the year, when the inspector general's office will make its annual solicitation for comments on the anti-kickback law.