Lawyers offer help, hints as government cracks down on radiology

The last two years have seen a marked increase in the number of investigations, prosecutions and settlements involving imaging centers and radiologists.

Most of the cases have sprung from basic billing fraud, but the government is building a growing enforcement portfolio on noncompliance with tricky regulatory requirements.

With that as a jump-off, two radiology-focused partners in the global law firm Reed Smith presented tips and best practices for dealing with the crackdown climate.

“Part of the trend is probably tied to the intensity of containing the Medicare and Medicaid spending by the federal government,” said Paul Pitts, JD, MHA, during a Dec. 10 teleseminar. “The Affordable Care Act instituted a number of things that also have led to a greater degree of enforcement. There have been a number of rules that have been released related to screenings, particularly for independent diagnostic testing facilities (IDTFs).”

Pitts said better tools for mining and analyzing billing data have helped investigators up their game.

Tom Greeson, JD, MBA, said the Department of Justice has been obtaining record numbers of settlements and judgments involving allegations under the False Claims Act. He reported that, in fiscal year 2014, DOJ took in close to $5.7 billion in FCA penalties—nearly $2 billion more than it collected in 2013.

“A large number of cases involve relationships with referring physicians, where there are allegations of either violations of the Anti-Kickback Statute or the Stark law,” Greeson said, adding that, when false-claims actions are filed, the civil penalties can run between $5,500 and $11,000 per claim. “A number of cases arise from failure to follow the various Medicare billing and payment rules. From what we have seen in our practice, there have been a significant number of cases involving failure to supervise diagnostic tests in accordance with the rules.”

Spotlight on supervision

Greeson and Pitts rolled out brief case studies in three categories of False Claims Act cases involving diagnostic imaging—improper billing, improper relationships with referring physicians and failure to comply with coverage/payment rules. The latter category zeroed in on the dangers of improperly supervising certain imaging exams, which ended up generating keen interest during an anonymous Q&A period that followed the seminar.

Among the improper supervision cases discussed were Universal Imaging in Detroit, which the government sued for $150 million over allegations of improperly supervised procedures and other offenses, and Florida-based Bedside Imaging/Raymack Enterprises, which was hit with a $16 million default judgment over lack of proper medical supervision and failure to report change of ownership.

“The supervision issue is a hot one,” said Greeson, who laid out the basics of supervision required in three levels as defined by CMS:

• General supervision does not require the supervising physician to be present for the procedure. “Here we’re talking about plain film, nuclear medicine, MR, CT, ultrasound without contrast—those kinds of studies,” said Greeson. “This is a significant responsibility, however, and because it’s so significant, no one physician can serve as the general supervising physician for more than three IDTF sites.”
• Direct supervision of MR and CT exams where contrast media are used is “where the majority of the false-claims actions arise,” said Greeson, explaining that Medicare’s requirement is that, during such procedures, the supervising physician does not have to be in the same room but must be present in the same office suite and immediately available to assist if required.
• Personal supervision applies to procedures in which the supervising physician must be in the same room where the test is performed throughout the procedure. “Here we are talking about image guided procedures, fluoroscopy,” said Greeson. “This comes into play significantly in hospital settings.”

Do's, don'ts and avoidance of drama 

Pitts offered several tips on what to do—and what not to do—should a government investigator come calling on you or someone else in your practice.

“First and foremost, you need to immediately notify the person who is in charge of compliance, whether that be the compliance officer, chief executive officer or your immediate supervisor of your being contacted by an investigator,” he said.

If a government agent does not produce a search warrant, subpoena or investigative demand, you have the right not to provide any information to the government, added Pitts. “Obviously you want to appear cooperative, and be cooperative, when someone is conducting an investigation,” he said. “But if they don’t appear with one of those legal documents, then you do have the right to withhold information.”

What not to do?

Don’t destroy or alter any facility documents or records once you’ve been contacted by a government investigator. “That could lead to all sorts of bad ramifications for the facility,” said Pitts.

Don’t lie or make false or misleading statements to any government agent or investigator, and don’t attempt to persuade other employees to give false or misleading information—or even to refuse to cooperate with the investigation. “You can certainly tell the workforce that the company would prefer that only the compliance officer respond to government investigators,” he said. “But if a government investigator comes to an employee outside the work area and outside of work hours, certainly that employee has the right to speak with and respond to that investigator.”

Pitts also urged attendees to consider ways to avoid whistleblower actions. The number-one precursor to such situations is a disgruntled employee, he said. “These are the folks who most often end up being whistleblowers,” he said. “Talk with your HR people to consider how to depart with someone on best terms to avoid this situation.”

“This is probably the most difficult and challenging of our best practices,” added Greeson. “The issue here is just to be incredibly sensitive to these issues. That doesn’t mean that you’re going to pay a ransom to any departing employee, but you have to be very sensitive about how you deal with those employees.”

Considering kickbacks 

Pitts wrapped up his pointers by advising talking over identified regulatory matters with legal counsel under attorney-client privilege.

During the anonymous Q&A session, several callers asked about supervision issues and one asked about kickback cases. “Some of those cases are pretty obvious,” the latter caller said, “but what about the case of, say, a primary care provider who has their own MRI and sends patients to a separate orthopedic surgery group—and would basically tell the orthopedic surgeons, ‘We’re referring these patients over to you, and we would expect you to send any MRI or other imaging studies to our facility as opposed to maybe a facility that isn’t involved in those referrals?’”

“The Stark rules and the anti-kickback rules obviously speak to cross-referral kinds of arrangements, so I guess one would have to look [closely] at the fact patterns,” responded Greeson. “I would say there are probably some areas of concern under the particular scenario you have described. If I were the counsel to that primary care group or that orthopedic group, I would want to look at that situation very carefully.”