News You Can Use: Review These FTC, HHS Rulings to Ensure Your Facility Is Still on Track

HHS puts its foot down on kickbacks for patient referrals

• FTC says SHO physician-hospital plan would violate anti-trust laws.
The Federal Trade Commission warns that a group of 192 physicians could get more than they bargained for if they go ahead with a plan to let the hospital that employs them make all of their deals with managed-care plans.
The FTC said in an advisory opinion that Suburban Health Organization (SHO), an Indiana non-profit, would be violating federal anti-trust laws if it required health plans to go through it exclusively to contract with physicians.
The SHO plan would have called for SHO to set prices for physicians’ services, and the FTC was concerned that this would eliminate price competition. The SHO plan aimed to increase efficiency and improve care, because it included developing practice protocols and disease-specific treatment parameters for some conditions, plus data collection and education.
But the FTC staff said the efficiencies and better outcomes weren’t enough to justify fixing prices for physician services. The FTC letter is at www.ftc.gov/opa/2006/03/shor31.htm.
 
• HHS expects to exclude Alvarado Hospital Medical Center from federal programs.
In early May, the U.S. Department of Health and Human Services issued yet another poignant reminder that if your facility isn’t following the rules, you could face expulsion from Medicare and other federal programs.
HHS notified Alvarado Hospital Medical Center in California and its parent company, Tenet HealthSystem Hospitals Inc., of its intent to exclude Alvarado from participation in Medicare, Medicaid, and all other federal healthcare programs.
The Office of Inspector General alleges that “Alvarado knowingly and willfully paid kickbacks in order to induce referrals of patients to Alvarado for the furnishing of items and services payable by federal healthcare programs.” Alvarado has 30 days to appeal the OIG’s decision of exclusion.
This action “should be a continuing reminder to healthcare providers that referrals of federal healthcare program beneficiaries should be based on the quality of care that is to be provided to the beneficiary, and not as a result of a financial benefit to be realized by the source of the referral or the practitioner providing the services,” said Inspector General Daniel R. Levinson in a May 8 press release from HHS.

- Published on 2006-07-11