February 1998 Bulletin

"The advisory opinion will not limit the investigation or enforcement authority of any other agency."

OIG’s opinion may have sharp teeth The Office of the Inspector General (OIG) of the Health Care Financing Administration (HCFA) has announced that it will offer "advisory opinions" about arrangements that may be implicated under the federal "fraud and abuse" legislation. Because medicare patients comprise a large portion of many orthopaedic practices, many orthopaedists may find the OIG’s advisory opinions to be just what the doctor ordered. But before you seek an advisory opinion from the HCFA OIG, understand the situation fully.

By Todd A. Rodriguez

To review briefly, Section 1128B(b) of the Social Security Act prohibits individuals or entities from "knowingly and willfully" offering, paying, soliciting or receiving remuneration in order to induce business reimbursed under the Medicare or state health care programs. Understand that "remuneration" is not limited to monetary compensation; a host of arrangements in which referrals are involved could trigger the statute.

Should you worry? Violation is punishable by fine and/or imprisonment.

What can you do if you know - or even suspect - that you may be in violation of the act? Consider taking advantage of an advisory opinion by the Office of the Inspector General (OIG) of the Health Care Financing Administration (HCFA). But be careful. Although an OIG advisory opinion may help some orthopaedists in some situations, the advice the OIG is offering is limited in scope, comes at a cost and is not the best answer for all orthopaedists seeking advice about potential Medicare anti-kickback law violations.

The simple fact that the OIG does not represent this service as a be-all and cure-all is reason enough to take a closer look at the advisory opinion offer, which, by the way, can be revoked or rescinded, despite the fact that you will pay for it if you ask for it, even if you do not receive it.

The OIG will provide advisory opinions only on the following specific issues:

1. what constitutes prohibited remuneration under the Act;
2. whether an arrangement is a stautorily permitted arrangement;
3. whether the arrangement satisfies the criteria of the fraud and abuse "safe harbors" (within the anti-
   kickback statute);
4. what constitutes an inducement to reduce or limit services under Section 1128A(b) of the Act to Medicare or Medicaid program beneficiaries (payment by a hospital to limit services); and
5. whether the activity in question constitutes grounds for imposition of sanctions under the Act.

The HCFA OIG will not answer a request for an opinion if it is based on "hypothetical" or third-party arrangements. Nor will the OIG provide an advisory opinion if:

• the request for information is "too general";
• the arrangement described in the request is unrelated to a named individual or entity;
• the opinion relates to similar arrangements that are under investigation or have been the subject of proceedings involving the Department of Health and Human Services (HHS) or another government agency; or
• an informed opinion cannot be made without extensive investigation or study.

• include not only your name and address, but also those of all other parties to the arrangements;
• state, from the above list, that specific topic for which you are seeking an advisory opinion; and
• provide a detailed description of the arrangements in question, including copies of all related operative documents.

You may set a limit on how much you will spend in order to receive the OIG’s advisory opinion; however, if at any time you elect not to complete the advisory opinion, you remain responsible for all fees generated to that point.

Within 10 days of receiving your request, the OIG will notify you whether or not it will accept your request. Alternately, the OIG might notify you that it needs more information before it will accept or reject your request. The OIG is obligated to issue an opinion within 60 days of acceptance of a request for an opinion, but expect delays.

Be aware that there are other nonmonetary costs, as wellóbeyond the $250 and other expenses. First, the OIG has reserved the right to publicize not only any advisory opinions it makes, but also the identity of the requesting entity and any supporting documents. Thus, at some point, it is possible that everyone, including your competition, will be able to find out exactly what you are up to.

Also, although the OIG has stated that it will not take action against a requester who relies, in good faith, on the advisory opinion, the OIG’s office also retains the right, at any time, to reconsider questions raised during the process or rescind or revoke its own advisory opinion.

Be aware that by submitting an application, you could draw unwanted attention to your practice arrangements (e.g. investigation).

Further, the advisory opinion will not limit the investigation or enforcement authority of any other agency. Finally, any opinion the OIG offers is nontransferable. You cannot generalize. Each opinion the OIG makes will apply only to the requester and other parties joining in the request.

These opinions may also be provided by the Department of Justice under the same regulations. These two offices frequently consult each other on fraud and abuse issues.

The 1997 Balanced Budget Act provides that the HHS must also issue advisory opinions on issues related to the federal prohibition of self-referrals, better known as the Stark legislation.

As the focus of the Stark legislation is on prohibited referrals for ancillary services, this new legislation may prove to be an even more useful tool for orthopaedists. According to the final regulations published on Jan. 9, 1998, the process for seeking Stark II advisory opinions is essentially the same as that for seeking antikickback advisory opinions. The text of the final regulation was printed in the Jan. 9, 1998 Federal Register. Opinions will be given on arrangements involving referrals to "designated health services" except clinical lab services, opinions will be binding on both HHS and the requesting party and providers may request opinions beginning this November.

Naturally, it is your practice and your responsibility and right to seek legal advice from any entity that offers it. However, before you seek legal advice from a government agency that also is empowered to prosecute entities that violate the laws on which it is offering advisory opinions, think twice.

You may be better off hiring an attorney who will act as your advocate and who will uphold attorney/client privilege and confidentiality. Consider hiring an experienced health care attorney if you have any questions about being in violation of the antikickback, antireferral, or other health care or health care business laws, on the federal or state level.

Todd A. Rodriguez is a consultant and attorney with The Health Care Group® and Health Care Law Associates, P.C., in Plymouth Meeting, Pa.
©1997, The Health Care Group®.