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Archives for August 2012

Office of Inspector General Issues Favorable Opinion

The U.S. Department of Health and Human Services, Office of Inspector General (OIG) issued a favorable opinion regarding arrangements for the provision of discounted therapy services at state-operated veterans’ nursing homes last month. The OIG found that the Proposed Arrangements present a low risk of fraud and abuse, and it would not impose administrative sanctions under the Anti-Kickback Statute (AKS). The opinion was requested by the operator of four Veterans’ Homes in which medical, clinical, and nursing services are provided to veterans and their spouses.

The OIG concluded that the arrangement for discounted therapy services presented a low risk of fraud and abuse under the Anti-Kickback Statute based on the following analysis:

1. The Requestor certified that the reduced rates represented fair market value and exceeded the contractors’ costs to provide the Services. Thus the Arrangement did not give rise to an inference of an improper nexus between the discounted business and referrals of federal healthcare program business.

2. The Arrangements are the result of an open, competitive bidding process that the Requestor conducted in accordance with state law.

3. The risk of inappropriate use of the discounted therapy services is low because only the Veterans’ Homes’ physicians could order therapy services, and none of these physicians had outside financial relationships with the contractors. Thus, the OIG concluded that the risk of ordering unnecessary services was reduced. Further, beneficiaries are responsible for paying cost-sharing amounts, and would have a financial incentive to monitor against provision of unnecessary services. OIG noted that had the Arrangement involved routine waiver of cost-sharing amounts, the contractors could be subject to possible sanctions under the AKS.

4. The Arrangements are not likely to have a negative effect on patient care.

5. The Arrangements would not adversely impact competition since the Requestor held an open, competitive bidding process.

6. The state receives the full benefit of the discounted therapies since the Requestor is a state agency.

However, had the contractors offered ancillary services or other remuneration not directly related to the provision of therapy services (such as free physical therapy services or free durable medical equipment), the OIG may not have issued a favorable decision.

From a legal perspective, the July 30th opinion gives additional specific insight into the analysis and decision making of the OIG as it pertains to the Anti-Kickback Statute and what is considered a legal arrangement.

We’re Moving & Opening a New Satellite Office

Last Day At Current Jeyaram & Associates Office

It’s moving day! A quick picture at the old office before we move into our new office and open the new satellite office!

Today we’re not only moving into a new office, but we’re also opening a satellite office as well. To better serve your needs, we now have locations in Atlanta near Perimeter Mall, and in Duluth, right off of Pleasant Hill Drive:

3555 Koger Boulevard
Suite 120
Duluth, GA 30096
(Mailing address)

The Terraces
400 Perimeter Center Terrace North
Suite 900
Atlanta, GA 30346

(p) 678.325.3872
(f) 678.708.4701

HCA Under Scrutiny for Alleged Healthcare Fraud

HCA, the largest for-profit hospital in the United States, is facing government scrutiny based on an investigation into the “medical necessity” of cardiac procedures in several of its hospitals, mostly located in Florida. According to a statement issued by HCA, the Justice Department “requested information on reviews assessing the medical necessity of interventional cardiology services provided at any company facility (other than peer reviews).” In this case allegations are that unnecessary cardiac testing and surgeries led to increased profits for HCA.


According to a New York Times article released on August 6, 2012, HCA declined to comment on whether it alerted Medicare, state Medicaid, or private insurers, or reimbursed them for any of the procedures that HCA ultimately deemed unnecessary.  Such notice is required by law.  According to internal HCA reports, doctors made misleading statements in patients’ medical records making it seem that the procedures were medically necessary, when in fact they were not and could have been more appropriately handled by nonsurgical treatment, such as drugs.


One of the physicians contacted by the Times defended his work, maintaining that improved documentation and record keeping would support his medical decision making.  Although clearly not a case of merely poor record keeping, HCA’s current predicament reminds physicians and other providers of the great importance of detailed and organized medical records.