The Inspector General's fraud alerts: questionable utility for hospitals and practitioners.
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Biomedical subjects
Publications and source records attributed to D K Thiel.
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On Feb. 9, 1989, amid considerable attention in the healthcare industry, Rep. Fortney H. ("Pete") Stark, D-CA, introduced in Congress the Ethics in Patient Referrals Act (H.R. 939). At the time, the so-called Stark bill would have effectively prohibited physicians from referring Medicare patients to any healthcare entity in which they had a financial interest, including hospitals, hospital departments, and physician-hospital joint ventures. The bill that emerged and was signed into law months later is but a shadow of its former self: The prohibition against physician referrals is directed only at certain clinical laboratories and certain relationships between physicians and the laboratories. Hospitals and physicians may be overly optimistic about the results of this most recent incursion into physician ownership. This was not the first government intrusion into physicians' financial affairs, and it is not likely to be the last. Congress will no doubt continue to focus attention on physicians and hospitals that seek revenues through joint investments in healthcare providers. In fact, Congress has already put referring physicians on notice, saying that if the Government Accounting Office finds evidence of inappropriate referrals, or increased Medicare costs, "it would be the intent of the relevant Committees to consider legislation banning referrals at the earliest possible date."
Since the inception of the Prospective Payment System, the physician fee freeze, and other cost-cutting measures, physicians have been approached with many income-generating opportunities relating to their practices. Unfortunately, many of these opportunities also present potential criminal and civil liability under federal Medicare anti-fraud and abuse provisions. The recent passage of the Medicare and Medicaid Program Patient Protection Act of 1987 has updated federal anti-fraud and abuse laws and expanded the sanctions which may be imposed on physicians. This article describes the types of activities prohibited by federal laws and discusses the operation of these laws in light of common joint venture, incentive, and contract arrangements frequently seen in medical practice.