Health Law Blog - Healthcare Legal Issues

Ambulatory Surgery Center Safe Harbor Regulations

Ambulatory Surgery Center – Anti-kickback Issues and Safe Harbor Regulation Compliance

Ambulatory Surgery Center StructuresMore and more procedures are being performed in Ambulatory Surgical Centers. The CMS has recently expanded the procedures that it considers to be safely performed in an ASC. Clearly, the trend is to move many procedures to an outpatient facility unless the health care needs of the patient clearly require an inpatient presence. One of the primary sources of capital for these new ASC ventures is often the physicians who are involved in performing procedures in the ASC or sending business to the ASC. From a purely business point of view, it makes sense to have investors who have a direct financial interest in seeing that the business succeeds, However, from the point of view of the party paying for the care, this same financial interest can lead to an increased and arguably unnecessary levels of procedures performed in the facility. The Medicare and Medicaid program, and many states, have enacted the Anti-kickback Statutes and other anti-referral laws that prohibit, or at least limit, the financial interests that a referring provider can have with an organization where there is any control over the referral flow to that entity.

Anti-Kickback Statute Prohibition

This is where the Federal Anti-kickback Statute comes into play by prohibiting the payment of any form of remuneration between parties where referrals are involved. The federal Anti-Kickback Statute proscribes the offering, payment, solicitation or receipt of any remuneration in exchange for a patient referral or referral of other business for which payment may be made by any Federal health care program. Violations of the Anti-Kickback Statute is a federal felony and can result in substantial prison time and criminal monetary penalties. Violation of the Anti-Kickback Statute can also serve as a basis for imposition of Civil Monetary Penalties. Enforcement of the Federal Anti-kickback Statute has been on the rise since the mid-1980s. Today, the federal government has made health care fraud one of its top priorities. We are hearing about new prosecutions on an almost daily basis as the government ramps up its enforcement through the creation of the HEAT program.

ASC Ownership and the Federal Anti-Kickback Statute

When we look at a typical Ambulatory Surgical Center venture, the primary concern is when the physicians who make referrals to the entity and provide services in the entity receive remuneration from the entity, This normally will involve remuneration in the form of a return on an investment interest. The referring physician may purchase an ownership or investment interest in the company that is set up to operate the ASC.  The ASC can be set up with capital contributions from a number of physicians or it may involve a hospital sponsored ASC that seeks additional capital investment from physicians.

Regardless of the exact structure, the Anti-kickback Statute will come into play to govern the structure and ongoing operation of the ASC. The ASC venture must be structured from the start to comply with the Anti-Kickback Statute. It must also be monitored on an ongoing basis to assure that it does not fall out of compliance with the Anti-Kickback Statute.

Random Posts

Loading…

Tags: , ,

Comments are closed.

John H. Fisher

Health Care Counsel
Ruder Ware, L.L.S.C.
500 First Street, Suite 8000
P.O. Box 8050
Wausau, WI 54402-8050

Tel 715.845.4336
Fax 715.845.2718

Ruder Ware is a member of Meritas Law Firms Worldwide

Search
Disclaimer
The Health Care Law Blog is made available by Ruder Ware for educational purposes and to provide a general understanding of some of the legal issues relating to the health care industry. This site does not provide specific legal advice and you should not use the information contained on this site to address your specific situation without consulting with legal counsel that is well versed in health care law and regulation. By using the Health Care Law Blog site you understand that there is no attorney client relationship between you and Ruder Ware or any individual attorney. Postings on this site do not represent the views of our clients. This site links to other information resources on the Internet; these sites are not endorsed or supported by Ruder Ware, and Ruder Ware does not vouch for the accuracy or reliability of any information provided therein. For further information regarding the articles on this blog, contact Ruder Ware through our primary website.