An increase in uninsured patients who show up in emergency departments (EDs), physician specialty shortages, and a physician population unwilling to take call all have led to a now-common practice: hospitals pay physician-specialists for on-call coverage of their EDs.
Though essential for providing adequate emergency care, this hospital-physician arrangement can violate anti-kickback laws. But recently, one hospital’s payments to on-call physicians was given an official federal stamp of approval. What does this official statement mean for hospital medicine groups and the hospitalists they employ?
Origins of the Opinion
In September 2007, the Office of the Inspector General (OIG) issued an advisory opinion that a hospital that pays physicians for providing on-call and indigent care services in the ED does not violate the federal anti-kickback statute.
An unnamed medical center requested the opinion and submitted details on the comprehensive, detailed program it had created to ensure coverage of the ED.
The hospital’s program includes varied payment structures for staff physicians based on their participation in an on-call schedule for the ED and provision of inpatient follow-up care to patients seen while on call, among other actions.
The program applies to 18 specialties including hospitalists, and all participating physicians receive a per-diem payment for each on-call day.
Lou Glaser, partner at law firm of Sonnenschein Nath & Rosenthal, LLP, in Chicago, wrote the request.
“In this particular case, the hospital extended the program to nearly every specialty on the staff,” he explains. “Few hospitals have gone that far. But my client wanted to ensure that this program was appropriate and, if questioned, wanted to be able to say that they did everything possible to set up an appropriate program. They also, to the extent that if the OIG said no, wanted to be able to tell their physicians that they tried everything possible” to set up a fair payment system.
Ron Greeno, MD, FCCP, chief medical officer at Cogent Healthcare in Irvine, Calif., and a member of SHM’s Public Policy Committee, is surprised the opinion was requested.
“It came out of the blue,” he says. “We weren’t worrying about it.” He believes the shortage of physicians willing to provide on-call care in the ED—particularly to uninsured patients—forces hospitals to create similar payment structures.
“The opinion basically says the OIG doesn’t frown on the current practice,” Dr. Greeno says. “There’s no reason they would—and if they did, it would mean a staffing crisis for all hospitals.” Part of this potential crisis includes care for uninsured patients, for which the hospital isn’t compensated.
A pivotal point in the OIG opinion and in the problems hospitals have with ED on-call staffing is payment for care of uninsured patients—especially those who require an on-call physician at the ED in the middle of the night.
“My client wanted a solution to this, a solution that ensured their indigent patients would receive care from all necessary specialties,” says Glaser.
The payment program created by Glaser’s client hospitals was structured to include care for indigent patients. “The OIG latched on to that for a number of reasons,” says Glaser. “But basically it shows that physicians are being paid for something that they would not otherwise be paid for.”
Effect on Hospitalists
Though the OIG opinion doesn’t change status quo for most, it provides valuable guidance on what the government considers an acceptable plan for covering on-call shortages. Criteria outlined in the opinion include:
- There must be a clear, demonstrated need for the on-call service;
- Participating physicians would otherwise be un- or under-compensated for a meaningful portion of their work, such as caring for uninsured admissions;
- Participating physicians deliver defined added value such as better outcomes, or participation in quality initiatives; and
- Reimbursement reflects market value.
Because most hospitalists are employed by or supported by the hospital for which they are on call, they are entirely exempt from anti-kickback issues. Therefore, the OIG opinion won’t affect their on-call payments.
“The opinion obviously isn’t geared toward any specialty,” Glaser points out. “In fact, the OIG noted that the hospital could not select specific groups and try to steer money toward those. That said, hospitalists are in a slightly different position than other medical staff. They maintain their practice at the hospital, and depend on that for their volume and income.”
If your hospital medicine group is not supported primarily by the hospital, how can you ensure your on-call payments are legally acceptable?
First, have a lawyer review your arrangements. While the onus for staying within the bounds of the law is on hospitals, it’s important for every hospital medicine group to have local legal experts examine their current or proposed payment structure for on-call and indigent care.
“Any time a hospital gives money to a doctor, [he or she] is subject to scrutiny,” says Dr. Greeno. “This has to be legally vetted.”
Second, document your own payment system. “There was a great deal of discussion in the request for opinion on how the hospital established its payment structure,” says Glaser. “The opinion shows the importance of having a well-documented process for establishing the rates to be paid, and showing that that’s fair.”
You can start your review of your own payment program by downloading a comprehensive overview of the OIG advisory opinion at SHM’s Web site, www.hospitalmedicine.org.
“For most of us who have been minding their p’s and q’s, [the opinion] doesn’t require any changes,” Dr. Greeno stresses. However, hospital medicine directors should stay on the safe side and check any on-call payment programs you might be participating in. TH
Jane Jerrard has written for The Hospitalist since 2005.