One year after OIG warning, physician payments remain a compliance risk

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More than a year after the Office of Inspector General (OIG) announced its renewed interest in physician compensation arrangements, the issue remains a top compliance concern for healthcare facilities around the country, according to one compliance expert.

In last year’s fraud alert, the OIG indicated it was specifically interested in medical directorships that pay for services a physician did not provide, payments that go above fair market value and arrangements that account for the volume or value of referrals. In an op-ed on RAC Monitor, Bret Bissey, former senior vice president and chief ethics compliance officer at the University of Medicine and Dentistry of New Jersey, wrote that the focus on “population-based medicine” has led to more contracted relationships, which could trigger fraud implications if there is an implicit focus on referrals.

“The conclusion that many in the compliance arena, including myself, have reached is that we have a high-risk area in our hospitals, and physician and focus arrangements should be crafted, managed and monitored with the utmost attention and concern,” he wrote.

According to Bissey, some high-risk areas include payments tied to referrals, poor documentation, inaccurate reporting of time spent on services and contracts that aren’t properly reviewed.

Legal experts have pushed for lawmakers to repeal or restructure the Stark Law, which governs physician payments, arguing that it is a major barrier to care coordination. Last year, Tuomey Healthcare System agreed to pay $72.4 million to resolve allegations that the system paid 19 specialists salaries that exceeded fair market value. In addition, two Florida hospitals paid nearly $190 million to settle claims alleging improper physician compensation agreements.  

- read the RAC Monitor article