Hospitals and physicians no longer have a one-stop shop to confess and resolve their legally questionable relationships with the governments healthcare fraud and abuse watchdogs. Citing limited resources, HHS Inspector General Daniel Levinson said in a letter to providers last week that his staff will cease to review violations of the federal restrictions on physician self-referral, or the Stark law, through its self-disclosure protocol.
HHS: Dont call on self-referrals
Inspector general’s office narrows scope of disclosure
The inspector generals office, Levinson writes, will only deal with Stark issues through the self-disclosure protocol if whats being confessed also triggers the often overlapping realm of the anti-kickback statute, calling kickbacks a serious risk to the integrity of the healthcare system. Also, as a means of focusing money and manpower on the more egregious casesthose dealt with through the self-disclosure protocolnow will draw a minimum penalty of $50,000, a move some find counterproductive if the government wants to foster a willingness to fess up.
Sara Kay Wheeler, a partner in the law firm King & Spalding, called the change a big deal because it could leave providers somewhat unsure what to do when they come across something that appears to violate Stark or the anti-kickback statute or both, which can be complicated to sort out. The protocol has played an important role in encouraging effective compliance programs, Wheeler said. Part of an effective compliance program is understanding the avenues available to providers for resolving potential issues.
Hospitals and physicians can pursue advisory opinions on potential Stark and anti-kickback issues raised by proposed and existing arrangements, but the opinions dont dispose of any liability if there is any, and the inspector generals office opines on kickback issues only, leaving Stark opinions to the CMS.
Levinson for the past three years has encouraged providers to take advantage of the protocol, offering a less disruptive and potentially less expensive resolution of arrangements and conduct that trigger his offices authority to impose civil monetary penalties for violations of both the Stark law and anti-kickback statute.
Just a year ago, a previous letter from Levinson advertised that his staff was likely to allow providers to settle matters and go on their way at the end of the process without a burdensome corporate integrity agreement or certification of compliance agreement if their internal investigations and disclosures were complete and timely (April 21, 2008, p. 12).
Perhaps as a result of a misinterpreted line in that April 2008 letter, the inspector generals office has seen more than a dozen disclosures that deal only with Stark violations, a noticeable increase, said Tony Maida, deputy chief of the offices administrative and civil remedies branch. (The opening paragraph mentions Stark violations as an example of what might be disclosed, but not for emphasis, Maida said.)
A hospital compensating a physician above the market rate without a written contract, for example, could constitute both a kickback for referrals and violation of the documentation requirements under Stark, and the inspector generals office would still resolve both problems through the self-disclosure protocol.
The distinction could be difficult to sort out in practice. I dont know how strictly theyre going to interpret that nuance, Wheeler said.
John Joseph, a partner in the law firm Post & Schell, said that he was surprised and disappointed by the new minimum $50,000 penalty for disclosures.
The inspector generals office should be moving in the other direction, offering an opportunity for honest people to do the right thing and come forward with questionable activities, and make a case they shouldnt be penalized if they commit to correct them, Joseph said. They are now taking the position that if you are availing yourself of the self-disclosure protocol, you need to bring your checkbook. Period.
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