Home Health & Hospice Week

OIG highlights $300,000 home health kickback settlement.

If you're trying to strengthen your ties with referral sources, you'd better do it right - or risk hundreds of thousands of dollars in penalties.

The HHS Office of Inspector General pointed to an example of how you shouldn't interact with referral sources in its latest semiannual report for the six-month period ending Sept. 30. Home Health Corp. of America based in King of Prussia, PA agreed to pay $300,000 and enter into a five-year corporate integrity agreement to settle kickback charges, the report says.

The OIG alleges that from February 1997 through May 1998, HHCA made payments in the form of loans, consulting fees and monthly space rental payments to six physicians located in Pennsylvania and Florida. The payments were in exchange for the physicians' referral of Medicare beneficiaries requiring home health services and/or durable medical equipment provided by HHCA, the feds charge.

Those practices don't reflect HHCA today, insists CEO David Geller. "The OIG settlement resulted from activity by the company's former management team and its former DME operations," Geller tells Eli.

HHCA sold its DME operations in 2001 and currently runs about 20 home nursing offices in Pennsylvania, Delaware, Maryland and Florida that generate $50 million in revenues annually, Geller says. 5 Tips To Stay Safe With Safe Harbors Home care providers can't be careful enough when it comes to relationships with referral sources, legal experts stress. Look to the safe harbor exceptions spelled out in the Anti-Kickback Statute to guide your relationships with physicians and other referral sources, advises attorney Marie Berliner with Lambeth & Berliner in Austin, TX.

Providers can look to both the personal services and management services safe harbors for guidance, recommends attorney Bob Ramsey with Buchanan Ingersoll in Pittsburgh.

Heed these tips drawn from the safe harbors for your referral source arrangements: 1. Use fair market value. Perhaps the most important component of complying with the safe harbor rules is setting payment to the referral source at fair market value. "If your contract for services includes all of the appropriate provisions, but the rate being paid/charged is wildly favorable to one party, then you are not within the scope of the exception," cautions attorney Robert Markette, Jr. with Gilliland & Caudill in Indianapolis. 2. Don't vary payment. "While a referral source can be paid for legitimate items or services, the amount of the payment ... should not reflect or vary with referrals," Ramsey reminds providers. Set payment ahead of time for the term of the contract to avoid this compliance landmine. 3. Get it in writing. To make clear you are meeting the provisions of the safe harbor, put everything about the relationship in a written contract ahead of time, Ramsey instructs. [...]