TELEMEDICINE IN CALIFORNIA

DOES THE LAW STRANGLE ATTEMPTS TO SAVE COSTS THROUGH TELEHEALTH?

Telehealth can take different forms.  It’s one thing to offer consultations and second opinions.  But once this useful tool is utilized for diagnosis and treatment, the rules change.

How can a compnay offer telemedicine, including diagnosis, treatment and prescriptions in California?  Does the physician have to be licensed?  How does a telemedicine company avoid the corporate practice of medicine doctrine?

THE PHYSICIAN MUST BE LICENSED IN CALIFORNIA

California’s Medical Board describes telehealth as: “Telehealth (previously called telemedicine) is seen as a tool in medical practice, not a separate form of medicine. There are no legal prohibitions to using technology in the practice of medicine, as long as the practice is done by a California licensed physician.”

Telehealth is not a telephone conversation, email/instant messaging conversation, or fax; it typically involves the application of videoconferencing or store and forward technology to provide or support health care delivery.” One statute states: Any law allowing telehealth shall not be construed to alter the scope of practice of any health care provider.

THE CORPORATE MEDICINE DOCTRINE

California prohibits the corporate practice of medicine, which among other things, requires that business or management decisions and activities resulting in control over a physician’ practice of medicine, be made by a licensed California physician and not by an unlicensed person or entity. In order to avoid the direct violation of state prohibitions on the corporate practice of medicine.  While there are legal structures that may promote non-physician investment in telehealth, (many companies use the so-called “friendly PC” model).

Enforcement by the medical board regarding the prohibition against the corporate practice of medicine generally is inconsistent.
Although there is no hard and fast rule as to when a given arrangement may be deemed to constitute corporate practice, the focus in any enforcement action likely will be on the level of control a physician exercises over the operation of the medical practice, specifically the professional judgment of licensed health care professionals. Where a high level of control exists, the arrangement may be found to be a sham intended to disguise the de facto practice of medicine by an unlicensed entity.

By Matt Kinley

Reporting Physician Office Controlled Substance or Prescription Abuse

Physician offices often are hit with an internal crime:  employees utilize the office, its forms, the doctors DEA Number, or even the computers to write unauthorized prescriptions. The physician’s office has the obligation to make sure that forms, computers, and other tools utilized to write prescriptions are carefully safeguards.  Attorneys and malpractice carriers can be consulted for the best practices.

Health and Safety Code Section 11368 states that anyone who forges or alters a prescription or who obtains any narcotic drug by a forged, fictitious, or altered prescription may be punished by imprisonment in the county jail or state prison for not less than six months or more than one year. Since prescription forgery is considered a criminal offense, it is recommended that a report be made to the local law enforcement.

The California Medical Board provides some specific advice:

Federal law requires physicians to report theft or loss of controlled substances and official Federal Order Forms (Form 222) to a regional office of the Drug Enforcement Administration. The DEA has offices located in Los Angeles, San Diego and San Francisco and the office addresses and phone number are available through their website. In addition, the DEA has their reporting forms available online at the following link: http://www.deadiversion.usdoj.gov/21cfr_reports/theft/index.html.

While neither the Medical Board nor state law requires that a report of stolen or illegal use of the physician’s DEA number be made to the Board, it is our recommendation that physicians provide the Medical Board with a written narrative of the circumstances and the actions taken by the physician so we may have this information on file. When the written narrative is received, this valuable information will be input into the Medical Board’s internal database for reference, as it is not unusual to receive complaints from pharmacists or law enforcement officers regarding concerns about physicians’ prescribing practices. If a physician has already reported that he/she has experienced a problem related to the illegal use of his/her DEA number, the Board has already been provided with background information on the problem. The written narrative should be forwarded to the Medical Board of California, Central Complaint Unit, 2005 Evergreen Street, Suite 1200, Sacramento, CA 95815.

Once the information has been processed, the physician will receive correspondence from the Central Complaint Unit containing their assigned “Conl Number,” which should be maintained for their records. A carbon copy of this correspondence will also be forwarded to the California Board of Pharmacy so they may notify pharmacies in the physician’s surrounding area of the incident. The notified pharmacies will then contact the physician to verify any prescriptions they receive on the physician’s prescription pad or using the physician’s DEA number. For additional questions or concerns regarding this issue, please contact the Central Complaint Unit through the Medical Board’s toll-free number, 1-800-633-2322.

In addition to the above, if the physician is aware of the theft or loss of the tamper-resistant prescription forms, the State Department of Justice, Bureau of Narcotic Enforcement must be notified. To report the theft or loss of the new tamper-resistant prescription forms, Form JUS MUST be completed. Please complete all applicable fields on the form and forward the form to: California Department of Justice, Bureau of Narcotic Enforcement, CURES Program, P.O. Box 160447, Sacramento, California, 95816, FAX: (916) 319-9448. If you have additional questions or concerns regarding lost or stolen tamper-resistant prescriptions forms, please contact the CURES Program at (916) 319-9062.

Matt Kinley, Esq. 

YOUR “JOHN HANCOCK” ON A COMPUTER KEYBOARD

When is an “electronic signature” legally appropriate in the medical context?

More than one would think. Electronic signatures are appropriate under HIPAA and other federal and state laws, and they are enforceable under California’s Uniform Electronic Transactions Act (Civil Code section 1633.1 et seq, “UETA”). There are some cautions, though. Digital signatures on custodian affidavit/declaration forms, consents to treatment, and generally all document where a patient must sign are permissible and legally enforceable.
Electronic & Digital Signatures.

There is a distinction between an “electronic” and a “digital” signature. Federal law and many state laws allow electronic signatures on some documents. Electronic signatures can be a picture of a signature, an agreed-upon string of characters, a symbol, a signature typed into a signature block in an ¬electronic form, and other personal non-encrypted, agreed-upon identifiers. A digital signature is an encrypted “hash” or tag that is registered to an individual and ¬accompanies transmission of electronic data or forms signed via computer. They are much more reliable than electronic signatures because they allow recipients to validate senders and prevent repudiation at a later date.

California Law: the UETA

California law provides in the UETA: “(a) A record or signature may not be denied legal effect of enforceability solely because it is in electronic form. (b) A contract may not be denied legal effect or enforceability solely because an electronic record was used in its formation (c)If a law requires a record to be in writing, an electronic record satisfies the law. (d) If a law requires a signature, an electronic signature satisfies the law.”

What is an electronic signature? The language of the statute is simple: an electronic signature satisfies the law. Typically, if the person “signing” types his name on an email, formatted screen or word processing document, that will suffice as a signature. The document with the signature should be reliable: sent from the signers email, or delivered by him or her in some way.

CAUTION!

As in all contracts, the surrounding circumstances are important. In a recent California Court of Appeals case, (JBB Investment Partners v. B. Thomas Fair), the court looked at the actions surrounding a parties alleged electronic signature to a contract. The Court determined that while the party had printed his name in an electronic communication, other communications had determined that there had not been “a meeting of the minds,” or a final agreement as to terms.

Even with this this cautionary case, most of the time electronic signatures will be acceptable for medical records.  If the party signing gives indications of some doubt about what is being signed, you might want to get the document signed in your facility.

By Matt Kinley, Esq.

 

 

Fraudulent Claims Act: Could they investigate your office?

Physician offices sometimes feel immune to the regulatory pressures imposed by federal and state authorities. I’ve heard expressions such as “we are such a small office” or ” we deal with such small dollars” to excuse lax or ill-informed billing practices. The solution is to create an office compliance plan, to make sure your office completes all billing correctly.

Here, from the Office of Inspector General, is a report of one small physician’s office that the OIG did investigate, resulting in a $650,000 settlement. Note the investigation arose from another investigation where a doctor was banned from all federal healthcare programs for 15-years.

“12-18-2014 OIG Enforcement Case
A Medical Practice, Doctor in New York Settle False and Fraudulent Claims Case
Jennan Comprehensive Medical, P.C. (Jennan) – a medical group practice in New York – and its owner, Henry Chen, M.D., entered into a $694,887.02 settlement agreement with the Office of Inspector General (OIG) for the U.S. Department of Health and Human Services, effective December 18, 2014. The settlement resolves allegations that from May 15, 2008 to December 31, 2013, Jennan and Dr. Chen knowingly submitted or caused to be submitted false and/or fraudulent claims to Medicare for physical therapy services. Specifically, OIG alleged that these claims were false and/or fraudulent for one or more of the following reasons: 1) physical therapy services were not provided or supervised by the rendering provider; 2) group services were billed as one-on-one provider-patient physical therapy services; 3) services were performed by unqualified individuals; and/or 4) claims for time-based physical therapy services did not accurately reflect the actual time spent performing the services. Senior Counsels David M. Blank, Tamara T. Forys, and Lauren E. Marziani, along with Paralegal Specialist Mariel Filtz, represented OIG.

This case developed as a result of OIG’s prior investigation of Joseph A. Raia, M.D., a former Jennan employee. Dr. Raia entered into a settlement with OIG on February 11, 2014 for $1.5 million and agreed to be excluded from participating in Federal health care program for a minimum of 15 years.”

 

Posted by Matt Kinley, Esq.

“10 Steps for Physicians to Survive the 2015 Accountable Care Act” – by Matt Kinley

“In 2015, physicians will find themselves facing new challenges and policies related to the Accountable Care Act (ACA), which reforms healthcare by changing payment systems. Instead of traditional, pay-for-service models, new systems will pay physicians for value provided to patients. To remain viable, physicians must transform their practice to utilize new payment systems to their advantage.

Payment for value means that physicians will be rewarded for quality of care, superior technology and clear communication. Physicians will also have to be prepared to see more patients while being compensated less per patient.

Physicians who wish to succeed under the 2015 ACA should follow these guidelines:

1.Practice with New-Fangled Payment Systems

2. Utilize Technology

3.   Hire Mid-Level Professionals

4. Consolidate

5. Address Patient Financial Responsibility

6. Be Prepared for Out-of-Network Claims

7. Understand Grace Periods

8. Refer Only to In-Plan Physicians

9. Reporting

10. Establish An Effective Financial Strategy”

To read my fully published article in the Inland Empire Business Journal, Click Here: TLD – Inland Empire Business Journal 12-2014

 

 

PHYSICIAN OFFICE COMPLIANCE: PHYSICIANS SHOULD PREPARE

Compliance in Physician Offices

Compliance guidance for physician practices was issued by the Office of Inspector General in 2000. Since that time, many physician practices, especially more complex specialty practices, have developed some sort of compliance plan. Compliance covers many areas of a healthcare practice.

Although compliance plans have not previously been mandatory, they have become “industry standard” as a way to minimize risks associated with health care regulations such as the Health Insurance Portability and Accountability Act of 1996, the Medicare and Medicaid Fraud and Abuse Laws, Anti- kickback Statute, Civil Monetary Laws, False Claims Act, the Clinical Laboratory Improvement Act and all other state and federal statutes, regulations and directives that apply to the operation of a complex physician’s practice.

The Patient Protection and Affordable Care Act of 2010, in section 6401, requires Health and Human Services and the Office of Inspector General to promulgate regulations that require most healthcare providers and suppliers to establish compliance programs. The compliance programs are intended to be “effective in preventing and detecting criminal, civil, and administrative violations” under the Medicare and Medicaid laws and other laws that govern operations.

Under the Affordable Care Act, physicians and group practices, will be required to establish compliance programs as a condition of enrollment in the Medicare program.HHS is required to issue regulations creating a timetable and basic core compliance program requirement.

Physician groups should begin the process of establishing compliance programs as soon as possible and not wait for final regulations. Compliance programs are a good way for physician practices to reduce risk associated with fraud and abuse and other legal matters that present risk to their operations. It makes sense for physicians to begin development now to provide ample time for creation of appropriately scaled policies and input from various personnel in the group.

It will not be sufficient to adopt pre-written compliance policies. Rather, physician offices must establish a continuing system of review for their office. Practices may need to be modified based upon their specialization. The seven core elements of effective compliance programs have been released by the Office of Inspector General, including the Physician Practice Guidelines.
A compliance program requires the physician to perform a risk assessment in their organization and document the outcomes of that assessment. The risk assessment could take many forms. Compliance professionals talk about a “gap analysis” which is an approach to help determine the vulnerabilities of your organization. Areas of risk provide emphasis to appropriate areas of risk that are identified through your risk assessment.
The seven areas of emphasis include:
1. Adoption of written guidelines and policies to promote the organization’s commitment to compliance;
2. Identification and appointment of a high ranking individual within the organization to serve as compliance officer;
3. Establishment of anonymous reporting systems, preferably through multiple pathways, to encourage individuals to make complaints regarding compliance items without fear of retaliation;
4. Effective education and training programs for all levels of employees and others with close relationships to the organization;
5. Ongoing auditing systems to assess the effectiveness of the compliance program and to provide input into areas that require additional emphasis;
6. Mechanisms to enforce the requirements of the compliance program and to discipline employees for violations of the organization’s commitment to compliance; and
7. An ongoing system of program modification based upon audit, feedback and experience that can further adapt the compliance policies to the specific issues faced by the organization.

By Matt Kinley, Esq

ALVAKA INDUSTRIES ON HIPAA COMPLIANCE

Why Will My Company be Listed on the HHS Wall of Shame?

My friend David Cunningham at Alvaka Industries has posted a great article for providers:  When should you comply with HIPAA?   The reason to comply with HIPAA is that it is required by law.  But more than that, your patients deserve it.

See the post here.

Posted by Matt Kinley, Esq

 

TLD Partner Matthew Kinley Speaks with Healthcare Risk Management on Corporate Negligence

As my firms healthcare practice chair,  I had the chance to share my insights with American Society for Healthcare Risk Management on the role of corporate negligence in medical malpractice cases.

You can read the full article posted by Healthcare Risk Management here:  TLD – Healthcare Risk Management 11-2014

Source: Healthcare Risk Management, published by AHC Media, Atlanta. Phone: (800) 688-2421. Email: customerservice@ahcmedia.com. Web

 

GO GREEN TO ATTRACT MARKET SHARE

Physicians Need to Stand Out

Physicians who are completing new construction should consider designating their development as green construction. While there is not legislative guidance in for green development in the healthcare arena, there is the Green Guide for Healthcare.

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According to the guide, it is “healthcare sector’s first quantifiable, sustainable design toolkit integrating enhanced environmental and health principles and practices into the planning, design, construction and maintenance of facilities….[it] provides the healthcare sector with a voluntary, self-certifying metric toolkit of best practices that designers, owners, and operators can use to guide and evaluate their progress towards high performance healing environments.performance healing environments.

The guide is a project of the non-profit organizations Health Care Without Harm  and Center for Maximum Potential Building Systems.

Posted by Matt Kinley, Esq.

 

HOME HEALTH COMPANIES ARE SUBJECT TO FEDERAL LAW, TOO

Payment for patients can land you in the federal penitentiary.

Home health care companies are facing more and more scrutiny from federal and state regulators. Such companies, particularly if they bill Medicare, are subject to all the laws, rules and regulations as are all health care providers.

In a case just reported by the Justice Department, an 64-year old owner of such a healthcare company pleaded guilty to violation of the Anti-Kickback laws for billing for services that were unnecessary and in some cases not even provided. He also paid recruiters which provided the company with patients. The owner was fined over $6.5 million, 75-months in prison and sentenced to three years supervised release. The case was investigated and brought as part of the Medicare Fraud Strike Force. However, such cases can be brought by state investigators or even by whistle blowers who are paid a percentage of recovery for reporting the health care provider, even if the whistle blower was part of the fraud.

The ramifications of even technical Medicare rules can be catastrophic a person’s life or business. Home health care companies should have competent legal representation to make sure their business plans are appropriate. Home health companies will soon be under rules that require compliance plans. Legal counsel should be engaged to help put in place an appropriate plan.

By:  Matt Kinley, Esq.  You can contact Mr. Kinley @ (562)715-5557.