March 2012 Archives

March 28, 2012

OIG Views Favorably a Proposal to Operate Website Containing Coupons and Advertising from Health Care Entities

On March 27, 2012, the Office of Inspector General ("OIG") posted a favorable, but narrowly defined, Advisory Opinion (Opinion No. 12-02) pertaining to Requestor's proposal to operate a website that would display coupons and advertising from health care providers, suppliers, and other entities (the "Proposed Arrangement").

Under the Proposed Arrangement, the Requestor, a corporation with a practicing physician member and another non-physician member, would contract with physicians and other health care providers and suppliers (the "Providers"), who wish to post coupons for health care items or services. The coupons could include discounts on items or services that are reimbursable by Federal health care programs, provided that such discounts comply with the applicable Federal health care program rules and regulations. As part of the service, the Requestor would not allow Providers to offer "free service" coupons; only coupons for a reduced price or a percentage discount would be permitted. The Providers would be required to give the same discount to any third party payor or insurance carrier that the Provider offers a patient. The Requestor also certified to the OIG that it would not be in a position to make any referrals to Providers that post coupons on the site. Even though one member of the Requestor was a practicing physician, the physician's name would not appear on the website, he would not post any coupons for his own services on the website, and he would not have any financial interest in the Providers the Requestor would contract with under the Proposed Arrangement. The Requestor would offer five (5) membership levels, one of which is a free "Basic" membership, the rest of which require a monthly fee, which would allow a Provider to create a profile, and if it chooses to do so, post coupons for consumers. The fee for the enhanced memberships would be a monthly flat fee.

The Requestor would also offer advertising on the website. Health care practitioners and entities (the "Advertisers") would be able to purchase space on the site for advertisement, including banner and pop-up advertisements. The Requestor certified that the fees for the coupon and advertising would be set in advance by Requestor, would be consistent with fair market value, and would not take into account the volume or value of any referrals or business otherwise generated between the parties for which payment may be made in whole or in part under any Federal health care program.

The potential customers (health care consumers) would pay no fees to access the website and coupons offered thereon. A customer would print a coupon (or download it to a mobile device) and the discount would be applied if the customer receives the service. The customer would not be required to pre-pay to receive the discount. The website would advise patients who submit their own claims of their obligation to report any discounts when submitting a claim.

After evaluating the pertinent facts, in its analysis, the OIG determined that the Proposed Arrangement involved two activities which implicate the federal Anti-kickback Statute ("AKS"): the selling of advertising space and the posting of Providers' coupons. The OIG indicated that both the posting of coupons and advertising on the website constitutes advertising activity. In evaluating advertising, there are a number of factors the OIG considers, including, the identity of the party engaged in the marketing activity and the party's relationship with its target audience; the nature of the marketing activity; the item or service being marketed; the target population; and any safeguards to prevent fraud and abuse. The OIG found that the Proposed Arrangement is sufficiently low risk under the anti-kickback statute for the following reasons:

1. The Requestor is not a health care provider or supplier and would simply operate a website hosting advertising and coupons;

2. The payments from Providers and Advertisers to the Requestor do not depend on the coupons being used by customers or obtaining services from the Providers or Advertisers, the fee is set in advance and does not take into account the volume or value of any referrals or business otherwise generated between the parties;

3. The advertising on the website would not be directed at the customer visiting the site and was akin to advertisements on a publically available website or in print media; and

4. The structure of the coupons decreases risk under the AKS because a customer does not pre-pay for the coupon and, thus, has no up-front investment. This fact, according to the OIG, significantly lowered the risk that a Provider's medical judgment would be improperly influenced to render medically unnecessary or inappropriate services based upon the fact that the Customer purchased a coupon.

The OIG also indicated additional risk existed due to the content of the coupons, which may offer discounts on items or services that are reimbursable by Federal health care programs. For the following reasons, the OIG found that the Proposed Arrangement included sufficient safeguards to mitigate the risks associated with the Requestor's role in posting the discounts:

1. Any discount would result in reduced costs which would benefit the patient as well as the payors, including Federal health care programs, as the discount would apply to the entire item or service, not only to the patient's cost-sharing obligations; and

2. The website's Terms of Use (which Providers must agree to before posting any coupons) require the Providers to comply with the discount safe harbor, which requires that buyers and sellers report any discounts to ensure that such discounts are shared with Federal health care programs; the coupons themselves would explain that the discount must apply to the entire item or service and not just a customer's cost-sharing obligation.

Notably, in its opinion, the OIG (without making specific references) makes it a point to differentiate the Proposed Arrangement from a "Social Coupon" type of situation involving relationships with websites such as "Groupon."

For the combination of the above reasons, the OIG concluded that the payments from the Providers and Advertisers for the Requestor's services associated with the Proposed Arrangement would pose an acceptably low risk of fraud and abuse under the anti-kickback statute and that the Requestor's role in posting the coupons also would be unlikely to improperly influence a beneficiary to choose a particular provider or supplier. However, the OIG does identify two areas of potential concern for which it expressed no opinion (1) Stark law issues in relation to the Physician Member and a person or entity with whom the Requestor would contract under the Proposed Arrangement; and (2) False Claims Act liability of the Requestor if the Requestor knows or should know that the Providers are not providing Federal health care programs with their share of the coupon discounts. Thus, although this ultimately was a favorable opinion, it was narrowly focused and identified potential other areas of concern/liability which fell outside the scope of the OIG's authority. As such, these types of arrangements must be carefully considered before a healthcare provider decides to participate.

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March 27, 2012

The HLP Women in Healthcare Networking Events to be Held 3/28 and 5/3

The HLP Women in Healthcare networking events are spearheaded by the women healthcare partners of The Greenberg, Dresevic, Iwrey, Kalmowitz & Pendleton Law Group, a division of The Health Law Partners. The events provide an informal forum for women in all aspects of the healthcare industry to network with their peers; discuss current issues in the healthcare field; share best practices and contacts, develop new business opportunities or just get out and socialize. Events are held four times a year in the tri-State area. Our kick-off event will take place on Wednesday, March 28th at The Andaz Hotel located at 75 Wall Street in New York City. We just announced our Buffalo event on Thursday, May 3rd. Please see the invitations on our website. We hope to see you there!

March 22, 2012

Attorneys Recognized By Martindale-Hubbell as Leaders in the Healthcare Field

The Health Law Partners is pleased to announce that four of our partners - Robert Iwrey, Alan Gilchrist, Dan Brown and Joel M. Greenberg - have been awarded AV Preeminent ratings by Martindale-Hubbell (the highest rating available) in recognition of their high level of professional skill and integrity. The ratings reflect a combination of the attorney's legal knowledge, analytical capabilities, judgment, communication ability and legal experience. The AV Preeminent rating is a significant accomplishment and serves as a testament to the fact that a lawyer's peers rank him or her at the highest level of professional excellence.

Robert Iwrey is a founding partner of The HLP and has been practicing healthcare litigation and transactional law since 1999. Mr. Iwrey provides counsel in all areas of healthcare law, including but not limited to licensure, staff privileges, contracts, physician practice issues, healthcare investigations and audit defense. Mr. Iwrey has been honored by d'Business Magazine as a Top Lawyer in Healthcare for 2010 and 2012 and named as a Super Lawyer for Healthcare Law in Michigan in 2010 and 2011.

Alan Gilchrist is a partner at The HLP and chairs its Civil False Claims and White Collar Criminal defense practice group. Mr. Gilchrist is a nationally recognized healthcare lawyer, specializing not only in civil false claims and white collar criminal defense, but also in matters related to licensure, reimbursement, compliance and fraud and abuse. He represents all types of healthcare providers, suppliers and professional organizations. Mr. Gilchrist has been recognized in the Super Lawyers publication; was selected by d'Business magazine in 2011 as one of the Top Lawyers in Metro Detroit; and is listed in the Best Lawyers in America in Healthcare Law and Administrative Law.

Dan Brown is the managing shareholder of the firm's Georgia office. Mr. Brown has extensive experience advising clients on the legal and regulatory issues impacting hospitals, physician groups, ambulatory surgery centers, sleep laboratories, dialysis clinics and independent diagnostic testing facilities. Mr. Brown is on the faculty of the Atlanta School of Sleep Medicine where he lectures on legal aspects of sleep medicine and sleep lab operations. He is also a member of the Board of Directors for the National Sleep Foundation in Washington, D.C., and is on the National Advisory Board of the Sleep Center Management Institute in Atlanta, Georgia.

Joel M. Greenberg
is a partner at The Greenberg, Dresevic, Iwrey, Kalmowitz & Pendleton Law Group (a division of The HLP). Mr. Greenberg has extensive experience assisting physicians, medical groups, dentists, and other healthcare providers address the numerous business and legal issues that arise in their practices. Mr. Greenberg counsels clients in all aspects of their professional lives from the initial phases of setting up an entity to establishing employment, partnership and shareholder agreements to ensuring that all actions taken by the entity comply with the federal and state fraud, abuse, self-referral and professional misconduct laws and regulations. Mr. Greenberg was also selected as a "Super Lawyer" in 2011, a distinction earned by only five percent of the lawyers in the New York Metro area, and is a co-editor-in-chief of the 3rd edition of the Legal Manual for New York Physicians, which is a collaborative effort by the New York State Bar Association and the Medical Society of the State of New York.

March 19, 2012

Michigan Man Charged with Health Care Fraud in NY

According to a Department of Justice press release, on Thursday March 15, 2012, a man residing in Dearborn Heights, Michigan was charged by Criminal Complaint with health care fraud. 51-year-old Fitzgerald Anthony Hudson was arrested, and could face a maximum penalty of 10 years imprisonment and a fine of $250,000. Assistant U.S. Attorney Aaron J. Mango is handling the case, and has alleged that in October 2007, the defendant obtained a New York State medical license by listing false information on his application by stating that he graduated from York University-Facility of Science, North York, Ontario, Canada. It is further alleged that he does not hold such a degree and, in fact, had been dismissed from the Warren Hospital Family Practice residency program in July of 2003.

The complaint also states that the defendant provided medical care to patients in the Western District of New York at Jones Memorial Hospital in Wellsville, N.Y. and Nicholas H. Noyes Memorial Hospital in Dansville, N.Y. from August of 2008 to August of 2010. It is alleged that he was improperly reimbursed approximately $200,000 under the Medicare Part-B and Part-D programs.

Mr. Hudson's initial appearance on the charge has been scheduled for March 29, 2012 at 3 p.m. before United States Magistrate Judge H. Kenneth Schroeder, Jr. This arrest was the culmination of an investigation on the part of the Federal Bureau of Investigation.

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March 19, 2012

OIG Report Questions IDTF Billings

In a Study released March 15, 2012, the Department of Health and Human Services, Office of Inspector General (OIG), reported on what it determined to be questionable billing by Independent Diagnostic Testing Facilities (IDTFs) for claims submitted in 2009. In conducting this study, the OIG analyzed claims among geographic areas, identified as Core Based Statistical Areas (CBSAs). The OIG then identified the 20 CBSAs with the highest average Medicare payments per beneficiary for IDTF services (the "high-utilization CBSAs"), compared IDTF billing patterns in high-utilization CBSAs to billing patterns in other CBSAs, identified IDTF claims with questionable characteristics, and compared the prevalence of IDTF claims with questionable characteristics in high-utilization CBSAs to the prevalence of such claims in all other CBSAs. OIG did not review the claims to determine whether the services were provided, whether any claims were medically necessary, or whether claims were coded correctly.

The findings of this Study include the following:

1. The 20 high-utilization CBSAs accounted for 11% of Medicare Part B payments for IDTF services, despite only having 2% of the total population of Medicare beneficiaries;
2. Almost 4 times more beneficiaries in high-utilization CBSAs received IDTF services than beneficiaries in other CBSAs;
3. On average, beneficiaries in high-utilization CBSAs received more IDTF services than beneficiaries in all other CBSAs;
4. The average Medicare payment per beneficiary who received an IDTF service in high-utilization CBSAs was almost 25 percent higher than in all other CBSAs;
5. 90% of IDTF services provided in high-utilization CBSAs were provided by 9% of IDTFs;
6. 71% of IDTFs providing services to beneficiaries in high-utilization CBSAs were in the Miami-Fort Lauderdale-Pompano Beach, Florida, CBSA;
7. High-utilization CBSAs had twice as many IDTF claims with at least two questionable characteristics as all other CBSAs (the OIG identified the following 3 characteristics as questionable: (1) a beneficiary being linked to 4 or more IDTFs; (2) IDTF claims that lacked corresponding claims by the referring physicians; and (3) IDTF claims for which the diagnosis categories were not the same as those on any other provider claims for those beneficiaries).

As a result of the Study, the OIG recommended that CMS monitor IDTF claims for questionable characteristics, review the claims of IDTFs which are found to have a high rate of questionable billing characteristics before payment to ensure that they are appropriate, and to assess whether to impose a temporary moratorium on new IDTF enrollments in CBSAs with high concentrations of IDTFs. CMS concurred in the OIG recommendations and indicated that IDTFs remain a key current focus of CMS and will continue to remain a key focus going forward.

This Study and CMS' comments on the Study show the continued focus by the government on IDTF facilities. Due to the continued focus of the government on IDTFs, any IDTF must, now more than ever, ensure full compliance with Medicare standards.

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March 16, 2012

RAC Program (Medicare Fee-for-Service) Record Request Limits Increased

Medicare released new guidelines regarding the limit on the number of additional documentation requests ("ADRs") RACs may request per 45-day period. Notably, these revisions constitute an increase for providers. (Note: the revised ADR limits outlined below do not apply to physicians and suppliers.)

Effective March 15, 2012, the ADR limits will follow the guidelines bulleted below:

•RACs may request up to 2 percent of all claims submitted for the previous calendar year divided by 8 per 45 days. ** Note that this constitutes an increase from the previous limit of 1 percent of all claims submitted during the previous calendar year divided by 8 per 45 days.

•Notwithstanding the above, there will be a 400 record per-campus maximum ADR request limit (unless the provider previously was notified of an increased cap of 500 ADR requests - These providers will now have a cap of 600 records per 45 days).

•CMS may give the Recovery Auditors permission to exceed the limit. Permission to exceed the limit may occur by CMS's own initiative or from the Recovery Auditor requesting permission. CMS or the Recovery Auditor will notify affected providers in writing.

The new ADR limits are available on the CMS RAC website at

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March 16, 2012

Medicare Redesigns Claims and Benefits Statement to Empower Seniors with Clearer Information on Health Services Used

The Acting Administrator of the Centers for Medicare & Medicaid Services (CMS), Marilyn Tavenner, announced the redesign of the statement that informs Medicare beneficiaries about their claims for Medicare services and benefits. The announcement comes as a part of National Consumer Protection Week. The redesigned statement, known as the Medicare Summary Notice (MSN), will be available online and, starting in 2013, mailed out quarterly to beneficiaries.

This MSN redesign is part of a new initiative, "Your Medicare Information: Clearer, Simpler, At Your Fingertips," which aims to make Medicare information clearer, more accessible, and easier for beneficiaries and their caregivers to understand. CMS will take additional actions this year to make information about benefits, providers, and claims more accessible and easier to understand for seniors and people with disabilities who have Medicare.

The redesign of the MSN includes several features not currently available to Medicare beneficiaries with the current MSN:

• Clearer language, including consumer-friendly descriptions for medical procedures;
• Definitions of all terms used in the form;
• A clear notice on how to check the form for important facts and potential fraud;
• An easy-to-understand snapshot of the beneficiary's deductible status, a list of providers they saw, and whether their claims for Medicare services were approved.
• Larger fonts throughout to make it easier to read;
• Information on preventive services available to Medicare beneficiaries.

Starting later this week, the redesigned MSN will be available to beneficiaries on, Medicare's secure online service for personalized information regarding Medicare benefits and services; and, in early 2013, paper copies of the redesigned MSN will start to replace the current version being mailed.

To see a side-by-side comparison of the former and redesigned MSNs, please visit:

Of particular interest to health care providers and suppliers, the new MSN provides a 1-800 number to report instances of suspected fraud and indicates that tips received may lead to a financial reward to patients reporting cases of fraud. Therefore, providers and suppliers should closely evaluate the compliance measures in place, as incentivizing patients to file complaints will likely lead to increased claims scrutiny and may lead to increased auditing activity.

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March 16, 2012

Long Island Red Cross Welcomes New Board Member

Joel M. Greenberg, a senior partner at The Greenberg, Dresevic, Iwrey, Kalmowitz & Pendleton Law Group A Division of The Health Law Partners in Lake Success, has been named to the board of directors of the American Red Cross on Long Island.

"I look forward to working on behalf of such an esteemed organization as the American Red Cross and particularly in helping it further its services on the Long Beach barrier island," said Greenberg, who resides in Atlantic Beach."

The American Red Cross responds to well over 100 local emergencies each year on Long Island--mainly home fires--and provides food, shelter and emotional support to those affected. During Hurricane Irene, nearly 5,000 residents evacuated to Red Cross shelters across the island.

Additionally, the Red Cross provides lifesaving training in skills like first aid, CPR and water safety to nearly 150,000 Long Islanders each year; and provides emergency communications and assistance to hundreds of local service members and military families.

"Joel brings a great deal of experience to our board and we look forward to working with him as we continually look not only for ways to help victims of disaster, but to make Long Island a safer place," said John Miller, CEO, Long Island Red Cross.

Greenberg is known for his abilities as a mediator and negotiator, having been credentialed by the American Health Lawyers Association and the Amicus Mediation and Arbitration Group to serve as a mediator in their Alternative Dispute Resolution programs. He frequently speaks regarding health law issues at hospitals, medical societies, colleges, and bar associations.

Greenberg is also dedicated to several not-for-profit organizations, such as the United Cerebral Palsy Association of Nassau County, MJHS and UJA-Federation of New York. He has been a long time member of the New York State and Nassau County Bar Associations, the American Health Lawyers Association, the Medical Group Management Association, and the American Academy of Family Physicians' Network of Consultants.

Greenberg served as the Managing Editor of the New York Health Law Update from 1998 through 2003 and was the Chairman of the Hospital and Health Law Committee of the Nassau County Bar Association from 2000 to 2002.

Greenberg received an undergraduate degree from Muhlenberg College and both a Master's degree in Public Administration and a J.D. from the American University in Washington, D.C. He is admitted to practice both in New York and the District of Columbia.

To learn more about the American Red Cross on Long Island, visit or call (516) 747-3500.

To view the original press release from the Red Cross, please visit:

March 2, 2012

Highmark Medicare Services Now Novitas Solutions

Effective January 1, 2012, Highmark Medicare Services ("Highmark") was acquired by Diversified Service Options, Inc. (a wholly-owned subsidiary of Blue Cross and Blue Shield of Florida, Inc.). As a result of the acquisition, Highmark changed its name to Novitas Solutions, Inc. ("Novitas"). Novitas will continue Highmark's role as the Medicare Administrative Contractor ("MAC") for J12 (Delaware, Washington, D.C., Maryland, New Jersey and Pennsylvania) and the Administrative Contractor for Section 1011. Though not operational at this time, the new website will be Click here for the informational alert from Highmark regarding the acquisition.

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