30 Video 5 DMU DPM 2024 Health Law Business Considerations.pdf

Top 10 Lessons: Helping Podiatric Physicians Survive the Health Law Jungle Video 5 DPM Community Health September 2024 Denise M. Hill, JD/MPA Associate Professor, Drake University Of Counsel Attorney,...

Top 10 Lessons: Helping Podiatric Physicians Survive the Health Law Jungle Video 5 DPM Community Health September 2024 Denise M. Hill, JD/MPA Associate Professor, Drake University Of Counsel Attorney, Whitfield & Eddy, PLC  Learning Objectives: Jurisprudence (2024) Identify the laws that protect patients; including their medical records, protected health information, and their safety. Identify the role of laws that govern corporations and other legal practice entities in protecting patients. Recognize the general legal concepts that govern medical practice. Identify the duties and responsibilities of state medical boards and hospital medical staff. Demonstrate knowledge of the following; Federal Kickback Law, Stark II Law, and False Claims Act as they relate to fraud and abuse. Define and demonstrate knowledge of informed consent liability, batter, and the essential elements of negligence (duty/standard of care, breach of care, damages, and causation) as they relate to health care delivery. Identify strategies for disclosure of adverse outcomes and legal ramifications. 2 © 2024 Denise Hill-- For Education Not Legal Advice  Top Lessons 6. Know how to recognize and avoid the dangers of fraud and abuse 7. Don’t try to blend in—report. 8. Set up a business system that works efficiently and profitably. 9. Don’t be proud, let process drive you & work with others to improve. 10.Don’t get stuck with a bad contract. 7. Have your hard work pay off Set up a business system that works most efficiently and is financially profitable Health Care Business Entities 5  What is a Corporation? Created under State Law Powers limited to Articles of incorporation Legal person (own, borrow, contract, sue(d) & hire) Limited liability—Corp sued=owner limited to loss of investment in the corporation Equity financing—sell shares of ownership Taxation Have a perpetual existence (until dissolved)  Formation & Governance of Corporations Articles of Incorporation filed—set out: – purpose(s) – express powers – implied powers (not written but necessary to carry out express) – must act within powers or no authority to act (I.e. fast food outlet) Bylaws For-Profit v. Nonprofit Members and Shareholders own Board and officers – Liability—gross or willful negligence – Duties (act with care, preserve assets, patient care, management/policy, and loyalty for shareholders)  Other structures/Legal Entities Sole proprietorship (owned by 1 person=taxed & liable) Partnership (no separate tax on the entity but liability the same) Subchapter S corporations Limited Liability Companies Limited Liability Partnerships Corporate Practice of Medicine  Key Factors & Tradeoffs Size Purposes/services to be offered Expectations of Equity Partners/public Basis of Governance Cost Desire for Flexibility/Control Tax ramifications Liability ramifications 9  Corporate Practice of Medicine (Prohibition Against) Doctrine: “…the role of nonpracticing physicians or nonprofessional corporations in employment relationships with physicians engaged in providing health care. Laws governing corporate practice of medicine vary among different states, but generally they require practitioner control over diagnosis and treatment, practitioner setting of fees, a reasonable relationship between services provided by layperson or corporation and amounts charged to the practitioner, and an unaltered practitioner-patient relationship. Mosby's Medical Dictionary, 8th edition. © 2009, Elsevier. 10  Professional Corporation & Professional Limited Liability Company Iowa Code Sections 496C & Code 489.1101 Allows designated "professionals" to practice in an association of other similarly licensed professionals which offers many of the benefits of a for profit corporation. Organized for the sole purpose of rendering professional services and formed by eligible professionals identified in the relevant Iowa Code sections. All shareholders (PC) or members (PLLC) are required to be licensed to render the specific professional service of the organization. PLLC has added tax benefits over PC. 11  Iowa Code 489.1107 Relationship & liability to persons served. (PLLC) This article does not modify any law applicable to the relationship between an individual practicing a profession and a person receiving professional services, including but not limited to any liability arising out of such practice or any law respecting privileged communications. This article does not modify or affect the ethical standards or standards of conduct of any profession, including but not limited to any standards prohibiting or limiting the practice of the profession by a limited liability company or prohibiting or limiting the practice of two or more professions in combination. All such standards shall apply to the members, managers, employees, and agents through whom a professional limited liability company practices any profession in this state, to the same extent that the standards apply to an individual practitioner. 12  Professional Corporation - Points to Consider All P.C. incorporators must belong to the same profession to be shareholders. All PL.L.C. owners need appropriate professional licenses to be members. Significant limitation on personal liability – Remain liable for their own malpractice – Limited personal liability for other professionals in their group. Still secure Professional Liability Insurance (especially if required by state, accreditors or payers) 13  Organizational Forms Healthcare Variety of organizational forms Each form advantages/disadvantages Different legal rules and obligations Can be hybrid: – Leased – Managed by private company  Public/Government Owned Usually not corporations Gov. funding—tax payers own Tax Exempt Tax exempt financing--Bonds Tax exempt donations No equity financing—Can’t sell shares Restricted investments Public control and oversight/Open meetings Public employees Expectation of Charity Care  Nonprofit Corporation—Purpose is not profit but to benefit the community Tax exemption IRS 501c(3) Tax exempt financing--bonds Tax deductible donations No equity financing—can’t sell shares Expectation of charity care Excess revenue for charitable purpose Not public employees or open meeting laws  For-profit Corporations-Primary purpose is to make money for owners (shs) Equity financing—sell shares Donations not tax deductible No exempt financing--bonds Pay taxes Employee options Private profits Control--limited public oversight  Get Good Advice Know the basics Get advice from attorneys and financial advisors Recognize the potential pitfalls: » Anti-trust » Lose 501(c)(3) » Fraud and abuse Hospital Medical Staff Issues Hospital Medical Staff Membership: PODIATRISTS https://www.hortyspringer.com/tag/interpretive-guidelines/  Protecting Patients The most effective mechanisms that protect patients from unsafe practitioners: Hospital credentialing Investigation & peer review Reporting 9/9/2024 21  The Governing Board The governing board of the hospital (‘Board of Trustees’; Board of Directors’) appoints practitioners to the medical staff and grants them clinical privileges. 9/9/2024 Free Template from www.brainybetty.com 22  The Medical Staff The Medical Staff is the organization of physicians and independent health care practitioners who are allowed to provide medical and other health services to patients at the hospital (or other organization). Not a separate legal entity 9/9/2024 Free Template from www.brainybetty.com 23  Who is on the Medical Staff? Medical Doctors & Doctors of Osteopathic Medicine approved by the Board Other Physicians & Practitioners approved by: – Federal law – State law – Hospital Policies & Procedures – Approved by the Board  CMS Interpretive Guidelines Conditions of Participation: Hospitals May 30, 2019 Posted on May 30, 2019 by hortyspringer QUESTION: We have some advanced practice nurses and physician’s assistants who are lobbying to become members of the Medical Staff. Some physicians support the idea, but others aren’t so sure. What are you seeing out there? ANSWER: In our experience, most Medical Staffs are composed of physicians, dentists, oral surgeons and, increasingly, podiatrists. In some states, it is required that others be appointed to the staff, such as psychologists in Ohio. State laws still vary. For example, in Pennsylvania, a hospital wanting to include podiatrists must seek an exception from the Department of Health, but it is readily granted. As CMS has amended the Conditions of Participation and Interpretive Guidelines in recent years, the door has been opened: §482.22(a) Standard: Eligibility and Process for Appointment to Medical Staff The medical staff must be composed of doctors of medicine or osteopathy. In accordance with State law, including scope-of-practice laws, the medical staff may also include other categories of physicians (as listed at §482.12(c)(1)) and non-physician practitioners who are determined to be eligible for appointment by the governing body. *** Interpretive Guidelines §482.22(a) The hospital’s governing body has the responsibility, consistent with State law, including scope-of-practice laws, to determine which types/categories of physicians and, if it so chooses, non-physician practitioners or other licensed healthcare professionals (collectively referred to in this guidance as “practitioners”) may be privileged to provide care to hospital patients. All practitioners who require privileges in order to furnish care to hospital patients must be evaluated under the hospital’s medical staff privileging system before the hospital’s governing body may grant them privileges. All practitioners granted medical staff privileges must function under the bylaws, regulations and rules of the hospital’s medical staff. The privileges granted to an individual practitioner must be consistent with State scope-of- practice laws. Today, it is becoming more common for a category to be added to the Bylaws for Advanced Practice Clinicians, and APCs may serve on committees with vote.  Relationship Ripe for Disputes Termination or denials of clinical privileges or membership Disputes between Medical Staff has Board responsible medical staff and board to assure quality no authority on policy/procedure but no clinical but experts expertise Disputes within the responsible for care medical staff; turf wars, credentialing 26  Medical Staff Membership & Clinical Privileges –Physicians must apply for medical Hospitals can: staff membership (the privilege of grant admitting patients to and caring for patients at the hospital). deny limit, suspend, –Physicians must apply for clinical probate, privileges (the privilege of terminate providing certain treatments and performing certain procedures at revoke the hospital). medical staff membership & clinical privileges Free Template from www.brainybetty.com 27  Protecting Patients The most effective — if not the only — mechanisms that protect patients from unsafe practitioners:. Hospital credentialing Investigation & peer review Reporting 9/9/2024 28  Credentialing Credentialing is the decision making process for determining whether a physician will be permitted to join a medical staff, participate on a managed care organization’s panel, obtain clinical privileges or be a member of another healthcare organization. Process Selection of MS Screening Verification of training, skills and history Done by Hospitals, Boards of Medicine, & Insurers 9/9/2024 29  DNUORG NPDB√ Abuse registries Crime 9/9/2024 Free Template from www.brainybetty.com 30 Credentialing of Podiatric Foot and Ankle Surgeons and Guidelines for Surgical Delineations of Privileges https://www.acfas.org/ACFAS/media/ACFAS_Media/Credentialing-and-Surgical-Privileges-2020.pdf  Uniform Credentialing Forms CRITERIA 1. Reasonable 2. Clear and understandable 3. Applied consistently and fairly State by State Uniform credentialing forms available at: http://www.hortyspringer.com/hsm/HealthLaw.aspx?id=1308 9/9/2024 32  Common Criteria 1. Current licensure 2. Relevant training or experience 3. Current competence 4. Ability to perform privileges requested 33  Credentialing Verification Organizations http://www.certifacts.org/ 9/9/2024 Free Template from www.brainybetty.com 34  Disputes over membership & clinical privileges 1. Denial 2. Limitation 3. Suspension 4. Probation 5. Termination 6. Revocation 9/9/2024 Free Template from www.brainybetty.com 35  Defining: “Peer Review” Process in which a group of professionals reviews the competence or professional conduct of a practitioner as part of quality improvement and/or to assess whether their clinical privileges or medical staff membership should be maintained, limited or terminated. Informal “Quality Review” Formal Disciplinary Proceedings  Benefits of “Peer Review” Improve Quality of Care Protect Patients Improve Physician Performance Required for Compliance Avoid Potential Legal Liability  Why would a physician participate in peer review? Protections for Peer Review: involved individuals and institutions are granted immunity from lawsuits; information related to the peer review process is deemed confidential; and peer review work product is designated privileged and inadmissible in court. 9/9/2024 Free Template from www.brainybetty.com 38 Federal Law: Health Care Quality Improvement Act (HCQIA)     39  HCQIA: Four Standards A professional review action must be taken— – (1) in the reasonable belief that the action was in the furtherance of quality health care, – (2) after a reasonable effort to obtain the facts of the matter, – (3) after adequate notice and hearing procedures are afforded to the physician involved or after such other procedures as are fair to the physician under the circumstances, and – (4) in the reasonable belief that the action was warranted by the facts known after such reasonable effort to obtain facts and after meeting the requirement of paragraph (3). 42 U.S.C. 11112 9/9/2024 40  Key Elements of Due Process 1. Right to notice of the hearing 2. Right to a hearing including: Sworn testimony under oath (transcripts) Right to cross-examine witnesses Right to subpoena witnesses and documents 3. Right to be represented by counsel 4. Right to an impartial decision-maker 5. Right to written findings and conclusions of law 6. Right to appeal the decision/request reconsideration HCQIA & Summary Judgment CASES: 42  Reporting to NPDB See National Practitioner Databank Guidebook: 9/9/2024 http://www.npdb-hipdb.hrsa.gov/resources/aboutGuidebooks.jsp Free Template from www.brainybetty.com 43  Mandatory Reporting about Physicians 42 U.S.C. 11133(a). Reporting by health care entities. (1) On physicians. Each health care entity which— – (A) takes a professional review action that adversely affects the clinical privileges of a physician for a period longer than 30 days; – (B) accepts the surrender of clinical privileges of a physician— (i) while the physician is under an investigation by the entity relating to possible incompetence or improper professional conduct, or (ii) in return for not conducting such an investigation or proceeding; or... shall report... 44 9. Don’t get Stuck with a Bad Contract Read, Review & Follow your Contracts Carefully or you will get Stuck with a Result You Do Not Want!  Right Out Of Residency After three years of training, I signed on to a job where I was taking over for a doctors portion of a partnership. The doctor was relocating to another area, he said to be closer to home. Later on I find out the other partner in the practice owed one million dollars to the IRS and was using the practice to money launder, and hadn't filed income tax in ten years. When I confronted the other partner about this he told me his lawyer told him he did not have to reveal this to me.  Offer and Acceptance Offer=manifestation of willingness to enter into an agreement/bargain. Upon acceptance of an offer, a contract is formed. Legal remedies and defenses if a breach Be cautious and aware during the offer and acceptance phase of negotiating a contract….It becomes Binding! – Offer may be revoked prior to acceptance if notice is given to the other party. – Once offer is accepted, attempt to revoke is too late. Vice-versa…an acceptance cannot be rescinded.  The Law Presumes That You Understand and Agree When You Sign “A court of equity cannot relieve competent parties who enter into contracts that are not tainted by fraud from the legal effects thereof because such contracts may be ill- advised or prove to be unprofitable or disadvantageous.” Carson v. Mikel, 205 Iowa 657, 659, 216 N.W. 60 (1928).  BOTTOM LINE…Contract language is critical! Negotiator MUST: 1. Be informed 2. Pay close attention to contract language, contract terms and conditions 3. Watch for ambiguities/Insist on clarification. Remember: Ordinary words or terms may not be ordinary in a contract. What one party believes a word means may not be what the other party understands that word to mean. If a contract defines a word or a term, that definition controls.  Cover Key Provisions Term and Termination Restrictive Covenants Notice Provisions Scope and details about work Accountability Accrual and Payment Ownership of Records, notification and access Miscellaneous Fraud & Abuse Contract Considerations Term—can’t be too long No restrictive covenant allowed No compensation for referals Must maintain medical judgment—specific language 51  Term & Termination Term: When the arrangement begins and ends. Termination: How can one of the parties terminate the agreement? – Without Cause – With Cause – Immediate Termination – Effect of Termination What triggers it? 52  Recruitment Agreements May be coupled with an employment agreement May be from a hospital but employment into a group or to assist in setting up your own practice. Certain restrictions due to anti-kickback and Stark II regulations Should be reviewed by an attorney familiar with Stark and anti-kickback Violations of these laws goes both ways: physician and healthcare entity. Stark II is NOT “ intent based”: You violate any technical part of law, you violate law. Whitfield & Eddy, PLC 53  Covenants-not-to-compete/restrictive covenants are commonplace in physician contracting. Unless bad faith on the part of the employer enforced IF: – reasonably necessary to protect the employer’s legitimate interests (reasonable duration, geography, patient access) – without imposing undue hardship on the employee or – adversely affecting the public interest. Facts determine what is reasonable and whether the restrictive covenant imposes undue hardships on the employee. 54  The Current State of the FTC Rule Banning Non-Competes: What Health Care Providers Need to Know April 23, 2024, U.S. Federal Trade Commission (FTC) voted 3-2 to finalize a new rule prohibiting non- competes. Scheduled to go into effect on September 4, 2024, employers barred from entering into non- competes with workers on or after the effective date. Also prohibits employers’ enforcement of non-competes that predate the Rule, other than agreements with senior executives. UPDATE: FTC Non-Compete Ban Set Aside Nationwide. On August 20, 2024, Judge Ada Brown in the Northern District of Texas issued an Order setting aside the FTC's Rule in the matter Ryan, LLC v. FTC, Case No. 3:24-CV-00986- E. Judge Brown found that the Rule was an unlawful agency action for which the FTC did not have authority and that the Rule was arbitrary and capricious. The Opinion and Order enjoined the FTC’s Rule nationwide, meaning the ban will not go into effect on September 4. Employers may continue to enter into and enforce non-compete agreements with workers subject to state law. The FTC will likely appeal the ruling.  AMA ethical opinion E-9.02 discourages restrictive covenants unethical if it is excessive in: – geographic scope – duration – fails to make reasonable accommodation of patient choice of physician. Iowa case law on restrictive covenants is fairly aligned with AMA ethics. 56  Contacting Patients & Medical Records on Departure From Practice Non-solicitation agreements Mutual understandings regarding medical record ownership Notification responsibilities – Patients – Professional Liability Carriers – Payers (Insurers and Medicare etc) – Government agencies (IBP, IBM etc) 57 10. Let process drive you in working with others and don’t be too proud to pass to opportunities for improvement.  Have systems in place Follow patient safety requirements Support compliance efforts  Preventing Errors “Every contact point between a patient, his [her] doctor, the hospital, the staff, the pharmacy, or any other person or site where care is provided is a place where an error could potentially occur. Each step requires analysis and planning to minimize the potential for errors.” Christine J. Quinn et. Al., Practicing Medicine in Difficult Times: Protecting Physicians from Malpractice Litigation. Sudbury, MA: Jones and Bartlett;(2009) at 39. Take Focus off Blaming & Put on Problem Solving Support the Quality Improvement & Compliance Processes of the Facility What is compliance? Commitment to: – obey all laws – follow all internal policies & procedures Program to detect/prevent illegal & improper conduct – Code of conduct which guides behavior – Guidelines and policies – Structure and processes  Why Comply? Organizational commitment to ethical and lawful behavior Provide operational consistency Promptly identify risks, respond and prevent recurrence Reduce organizational exposure to civil and criminal liability What are Most Podiatric Practices Responsible to “Comply” With? HIPAA OSHA Internal Chart Auditing Infection Control Medical Records Non-Discrimination & Disability Rights Stark Law Fraud, Waste & Abuse (FWA) Monitor OIG List of Excluded Providers  Primary Areas Business Relationships Ethics & Corporate Integrity Patient Relationships & Quality Care Conflicts of Interest Protect Corporate Assets  Avoid Conflicts of Interest Persons in positions of authority may not use their position to profit personally or assist others in profiting at the expense of the organization Conflict of interest statement: – Financial interest – Services competitors/vendors – Participation on boards – Honoraria  Corporate Assets: Confidentiality/Security Patient information/HIPAA Proprietary information Personnel actions/decisions  Purpose of Compliance Programs Prevention Detection Remediation Reduce likelihood of act/event that could lead to liability Be the first to learn of such an act/event Reduce likelihood of act/event that will lead to loss of confidence of the public Why have a Formal Comprehensive Compliance Program? Complex requirements Discourage wrongdoing Detect & contain misconduct Severe Limitpenalties liability for non-compliance Help avoid prosecution or exclusion Mitigate Provide sentences & penalties consistency Reduce likelihood of negative publicity Mitigating factor inisinvestigations Compliance Good Business!!!  Where Do We Where else….AT THE Start? TOP!!! Roles & Responsibility Governing Board “We are constantly working towards the highest level of Legal Counsel compliance possible.” All Managers Mike Davidson Employees, Providers A Compliance Officer is…?  Effective Compliance Programs … Define behavioral performance expectations Flow from top management Are based on culture of ethical behavior Satisfy legal requirements in form and substance Are implemented with a serious commitment  Elements of Compliance Written standards of conduct Oversight & clear compliance authority Education & training Reporting mechanism(s) 7 Basic Assessment & Audits Elements of a Compliance Response & prevention Program Remediation (POC)  HIPAA OSHA Internal Chart Auditing Infection Control Medical Records Non-Discrimination & Disability Rights Stark Law Fraud, Waste & Abuse (FWA) Compliance Monitor OIG List of Excluded Providers 1. Manuals, Training & Employee Screenings 2. Effective Monitoring & Auditing Medical Records 3. Security Risk Assessment https://www.podiatrytoday.com/index.php/basics-practice-compliance-are-you-ready-audit  COVID & PDM 1. Prohibition & Delay of Elective Procedures 2. Shifting Model Wound Care During Pandemic 3. Telehealth for Medicare Part B & Medicare Advantage Patients—Furnished Remotely 4. Telephone & online digital E/M services for patients with any insurance https://www.ama-assn.org/system/files/2020-06/state-elective-procedure-chart.pdf https://www.apma.org/PracticingDPMs/covid19.cfm https://www.fpmb.org/Resources/COVID-19.aspx  It’s a Zoo out there… Follow “Care & Feeding” of Your Practice— Awareness, Commitment, Compliance, & Insurance the keys to help you make it!