Practice Management Alert

Question: One of the doctors in my practice has asked me to waive the charges for services he provided to the child of one of his friends from medical school, citing -professional courtesy.- Am I allowed to do this? If so, how should I go about it? 
  
New Jersey Subscriber

Answer: The safe answer:  Don't do it. Although physicians in the past have extended professional courtesy to colleagues, there are now many federal and state laws that prohibit the practice under a wide variety of circumstances.
 
Even with the best of intentions in waiving fees for certain classes of patients -quot; traditionally other doctors and their families and members of the clergy -- the physician is in many cases violating the law, especially if it involves a Medicare claim. 
 
The routine waiver of deductibles and copayments is unlawful because it results in (1) false claims, (2) violations of the anti-kickback statute, and (3) excessive utilization of items and services paid for by Medicare, according to the U.S. Office of Inspector General. Make sure you and the practice owner understand the law in this area.
 
The legality of particular professional courtesy arrangements will turn on the specific facts and on the specific intent of the parties.     

The main difference: Generally, the government is treating waivers of the entire professional fee differently from waivers of copayments or deductibles. There are two situations you may confront in your practice:

 - Waivers of copayments or deductibles. Except where they are based on individual circumstances of financial hardship or occur after reasonable collection efforts, these types of waivers are prohibited by the False Claims Act. 
 
The reasoning is that waivers might be offered to another doctor to encourage favors from the doctor receiving the waiver.

 - Waivers of the entire fee.  Under the anti-kickback statutes and/or Civil Monetary Penalties law (CMPL), waiving the entire fee is prohibited when it is done with the intent to generate additional federal healthcare business through referrals.  

However, if there is no intent to induce referrals, the False Claim Act may not be violated as long as the anti-kickback rules -- and CMPL -- are not violated. 
   
Just say -no-: Because of the complexity and seeming ambiguity of the law in this area -- and the fact that the legality of any particular fee waiver depends on the particular facts of the situation -- the best approach is to abandon the practice of extending professional courtesy to other physicians altogether.  

-- The answers to the Reader Questions were provided and/or reviewed by Catherine Brink, CMM, CPC, president of HealthCare Resource Management Inc. in  Spring Lake, N.J.