The scrutiny of relations between hospitals and physicians continued with Iasis Healthcare Corp. saying it received a subpoena last week from HHS' inspector general's office. The subpoena seeks documents related to physician contracts, and a legal expert said a whistle-blower lawsuit or other inside information is probably behind the subpoena.
Iasis, based in Franklin, Tenn., said the subpoena covers all contractual relationships between physicians and its hospitals dating back to January 1999. These relationships include leases, medical directorships and recruitment agreements, Iasis said.
Kevin McAnaney, former head of industry guidance for HHS' inspector general's office, said the subpoena and the area it covers is no surprise. "Hospital-physician relationships have always been a major focus of the government's fraud and abuse efforts, on the theory that physicians generate business," McAnaney said. The subpoena isn't evidence of an increase in enforcement, since these relationships are already a busy area for fraud and abuse enforcement, he said.
"I think it's likely to be based on inside information simply because that's the most prudent way for the government to focus its enforcement resources," McAnaney said.
In January the inspector general's office issued revised guidelines to hospitals on how to comply with fraud laws in their physician relationships (Jan. 31, p. 4). Physician relationships also have been a focus in several government probes of Tenet Healthcare Corp., Dallas. Authorities are investigating relationships between physicians and Tenet hospitals in California, Louisiana, Tennessee and Texas.
The biggest case involves Tenet's Alvarado Hospital Medical Center, San Diego. Alvarado, its former chief executive officer and a Tenet subsidiary are putting on their defense in U.S. District Court in San Diego against the government's charges that they conspired to use physician-relocation agreements to funnel money to existing physician practices and induce referrals. It is the second time the defendants have faced the charges; the jury deadlocked in the first trial, leading to a mistrial (Feb. 21, p. 4).
The defense case will take several more weeks, depending in part on the length of government cross- examinations, a spokesman for the defense said. The first trial lasted four months, but the defense did not put on a case in that trial, opting to argue that the government didn't prove its case.