Corporate Compliance

What if a sanctioned doc sees only non-Medicare patients?

Compliance Monitor, October 21, 2005

Q. I heard an attorney say, "I don't see a problem having a sanctioned physician on staff as long as he or she doesn't treat Medicare/Medicaid patients." In my opinion, he was 100% wrong. Am I in error?


A. No, I'm afraid the attorney's statement is wrong. While it is not illegal for a provider to bill a private payer for services, having a sanctioned provider on staff raises numerous problems that the lawyer's statement ignores.

First, the prohibition on billing for a sanctioned provider's services applies to patients enrolled in all government health programs; assuming only Medicare and Medicaid patients are covered is a common mistake. In reality, the number of patients involved is significantly larger than just those covered by Medicare and Medicaid. The patient-identification problem is huge, as patients are enrolled in so many programs.

Second, one cannot assume that hospitals or other providers can distinguish a patients' source of payment and have the capacity to switch physicians at, or before, providing services. Moreover, Medicare is frequently a secondary payer, and institutions often make those determinations after services are provided.

Of course, facilities with emergency departments must comply with the Emergency Medical Treatment and Labor Act, which mandates that the provider stabilize the patient before even requesting insurance information. So the fundamental premise underlying this attorney's statement-that one can identify every Medicare and Medicaid (or any government program) patient before care is provided-is false.

Moreover, many private insurers will not pay for services provided by sanctioned individuals, so even that distinction is without merit. If the institution has a contract that prohibits payment for sanctioned individuals (or if payment is prohibited by state insurance or consumer fraud law provisions) the institution will face contract (or state law) penalties.

Making a mistake can cost your facility dearly.

If a provider renders any bills for services provided by a sanctioned individual, the repayment amount must cover the entire period the person was sanctioned, regardless of when the provider found out. What's more, the provider could face additional penalties for filing false claims. A violation of the False Claims Act can result in penalties of up to $11,000 per claim, plus three times the amount of the damages that the government sustains. Additionally, the government can exclude violators from all government healthcare programs.

That is why checking the OIG exclusion list each time it is issued is so important.

I should note in closing that there are certain administrative tasks that the government has permitted sanctioned individuals to undertake as long as the individual has no connection to patient care. Still, I would advise caution in making any such appointment unless you get a prior written opinion from the OIG.


This answer was provided by John Reiss, Esq., partner at Saul Ewing LLP in Philadelphia

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