January 6, 2023

OIG Issues Advisory Opinion 22-20 Permitting Hospital Employed Nurse Practitioners to Assume Additional Duties

OIG Issues Advisory Opinion 22-20 Permitting Hospital Employed Nurse Practitioners to Assume Additional Duties

By David B. Bailen, Esq.

On December 19, 2022, the U.S. Department of Health and Human Services (“HHS”), Office of Inspector General (“OIG”) posted Advisory Opinion No. 22-20. The opinion analyzed whether an acute-care hospital’s (the “Hospital”) utilization of its employed nurse practitioners (“NPs”) to perform certain services that have traditionally been performed by a patient’s attending physician in certain medical units of its hospital campuses (the “Arrangement”) constitutes grounds for the imposition of sanctions under the exclusion authority provided in 42 U.S.C. § 1128(b)(7) or the civil monetary penalty provision provided in 42 U.S.C. §  1128A(a)(7), as those sections relate to the commission of acts described in 42 U.S.C. § 1128B(b) (the “Anti-Kickback Statute” or “AKS”). The OIG determined that the Arrangement does generate prohibited renumeration under the AKS if the requisite intent is present, but it will not impose sanctions on the Hospital because the Arrangement presented minimal risk for fraud and abuse.

Under the Arrangement, the Hospital utilizes employee NPs to render care to patients of (predominantly primary care) physicians in the general care unit who chose to participate (“Participating Physicians”).  This relieves the Participating Physicians of a range of tasks and services which they would otherwise be expected to perform thereby saving them time, which they can use to undertake other tasks or perform other separately billable services.

The specific tasks to be performed by the NPs include:

• promptly initiating plans of care through existing protocols;

• implementing any applicable care protocols instituted by the Hospital (e.g., stroke or community-acquired pneumonia protocols);

• rounding on assigned units, during which the NPs address concerns of patients, their families, nurses, and other clinicians (e.g., physical therapists and speech therapists);

• responding to laboratory or imaging studies, including arranging prompt follow-up testing and attending to abnormal results, as needed;

• addressing rapid changes in patient conditions, including adjusting care plans and ordering imaging, laboratory tests, or other diagnostic tools or interventions in real time;

• educating and supporting patients and families;

• coaching, educating, and otherwise supporting nurses on the unit, including providing certified continuing education;

• overseeing and supporting unit-based quality improvement projects

• discharge planning, which at times includes obtaining insurance authorizations for post-acute care (such as for home health care, skilled nursing, or acute inpatient rehabilitation); and

• scheduling follow-up testing and appointments.

By utilizing NPs to provide services which would otherwise be provided by Participating Physicians, the Hospital is able to operate more efficiently and provide more healthcare services to its patients.  However, at the same time, the Arrangement generates renumeration for the Participating Physicians.

The OIG based its finding of minimal risk of fraud and abuse on the following factors:

First, the Arrangement is predominantly restricted to primary care physicians and only in two non-surgical, non-specialty units, rather than specialty units where referrals would be more lucrative. In addition, the Hospital does not take into account a physician’s volume or value of expected or past referrals when offering the Arrangement. Moreover, any compensation it pays to Participating Physicians outside of the Arrangement does not reflect or take into account any services performed by the NPs under the Arrangement. In combination, these facts mitigate the risk that the Arrangement could be used to induce the reward of valuable referrals from physicians.

Second, the Arrangement contained safeguards lowering the possibility of fraud and abuse.  For example, the Participating Physicians must do daily rounds, closely collaborate and communicate with the NPs, and maintain the same level of accountability for patient care as the non-participating physicians. In addition, the Hospital does not make any payments or ancillary agreements to induce or reward referrals from the Participating Physicians. The Participating Physicians are also prohibited from billing for the services performed by the NPs and can only bill for services where they have documentation supporting the work they actually performed. As such, the OIG found that the specific facts of the Arrangement are distinguishable from suspect arrangements where, for example, hospitals permit their employed NPs to provide services to physicians’ patients at no cost to the physicians, and the physicians then bill payors.

Third, the design of the Arrangement will likely increase the level of care for patients in these units without increasing costs to Federal health care programs because the Hospital does not bill for NPs services, even when the services performed under the Arrangement would otherwise be separately reimbursable. This mitigates the risk of inappropriately increasing costs to the Federal health care programs due to additional claims for reimbursement.

While recognizing that the Arrangement does generate renumeration to the Participating Physicians and at least one purpose of providing such renumeration may be for the inducement of referrals to the Hospital for items and services reimbursable by a Federal health care program contrary to the proscriptions of the AKS, the OIG declined to impose administrative sanctions because it involved minimal risk of fraud and abuse. The Arrangement included safeguards that provided sufficient risk mitigation, did not increase costs, and may have enabled the Hospital to provide better patient care; therefore, the OIG decided not to impose administrative sanctions on the Hospital. Thus, the OIG has again demonstrated flexibility in its interpretation and enforcement of the Anti-Kickback Statute by approving the Arrangement, notwithstanding the potential for generation of prohibited renumeration.

Despite the OIG’s permissive determination with respect to the current Arrangement, if a hospital considers implementing a comparable program, it must fully evaluate the costs and benefits with a focus toward compliance. It is important to note that, as with all OIG advisory opinions, the OIG only analyzed this particular Arrangement as it applies to the AKS. As such, any hospital contemplating a program similar to the Arrangement must also consider compliance with other statutes and regulations (e.g., Stark, False Claims Act).  Hospitals must ensure that implementation of similar arrangements does not cross the OIG’s less-than-clear line between prohibited remuneration and sufficient safeguards to mitigate potential fraud and abuse or otherwise violate applicable law or regulations.

For more information, contact David B. Bailen, Esq. at dbb@spsk.com or 973-798-4963.

 

DISCLAIMER:  This Alert is designed to keep you aware of recent developments in the law.  It is not intended to be legal advice, which can only be given after the attorney understands the facts of a particular matter and the goals of the client.