NEWS AND VIEWS FOR PTs

A complimentary newsletter from

MAILLY INGLETT & BARMAK, LLC

Educators and Consultants to Physical Therapists

 
SEPTEMBER, 2010 - Volume 1, Issue 9
In This Issue
Cash-Based Practice & Charging Below the Medicare Fee Schedule
For Your Information - Q & A
Preventing Sexual and Other Forms of Harassment in the Workplace
Cash-Based Practice & Charging Below the Medicare Fee Schedule
This article is intended to address an issue that we know has caused tremendous confusion for many PTs with whom we have spoken in the past. It seems as if PTs get a different answer from everyone they talk to about this particular issue.  The issue is the practice of charging patients less than the Medicare Physician Fee Schedule (MPFS), if the patient wishes to pay cash for the services they receive. 
 
Keep in mind that this issue is not applicable to patients who already are covered by Medicare, because PTs are prohibited from privately contracting with such beneficiaries. This only applies to other patients, who may have no insurance and/or may wish to pay cash for their care. Some of these PTs have been told that they cannot charge the Medicare more than they charge others, and this is not entirely accurate.
 
First, as you probably already realize, it can be very risky making assumptions about how government agencies feel about certain practices by health care providers. Nevertheless, there has been some communication from the U.S. Office of the Inspector General (OIG) on this particular topic.
 
The first thing to keep in mind is whether you actually have your own fee schedule, which you absolutely should; and the second is how you should set your fees. Setting fees without regard to your costs of practicing is simply unwise, if not foolish. If you are simply choosing percentage of what Medicare pays as the basis for your fees, you are not running your practice in the most diligent, defensible, and cost-effective manner.
 
That having been said, here are some responses from the OIG on the issue of charging less than the MPFS:
http://oig.hhs.gov/testimony/docs/2004/40624oig.pdf
 
"By statute, OIG is authorized, but not required, to exclude from participation in the Federal health care programs any provider or supplier that charges Medicare or Medicaid substantially more than it usually charges other customers. This law is intended to protect the Medicare and Medicaid programs - and the taxpayers - from providers and suppliers that routinely charge the Medicare or Medicaid programs substantially more than they usually charge other customers."
 
While this reference makes it appear that having a fee schedule set below Medicare would be a violation of the law, some further clarification has been offered by the OIG in the past regarding what is meant by "usually charges". We have highlighted the most important aspects of this information. See the following:
http://oig.hhs.gov/fraud/docs/safeharborregulations/lab.htm
 
"In addition, section 1128(b)(6)(A), which permits exclusion of providers that submit claims to Medicare or Medicaid for amounts substantially in excess of the provider's usual charges, is not a blanket prohibition on discounts to private pay customers. Section 1128(b)(6)(A) addresses a much narrower issue tiered pricing structures that set one price for Medicare or Medicaid and a substantially lower price for most other customers. Given the statutory language, we do not believe that the section 1128(b)(6)(A) is implicated unless a provider's charge to Medicare is substantially in excess of its median non-Medicare/Medicaid charge. In other words, a provider need not even worry about section 1128(b)(6)(A), unless it is discounting close to half of its non-Medicare/Medicaid business."
 
In other words, unless and until half of your practice is cash-based, the OIG appears to be saying that they don't care what you charge. At the same time, remember what we said at the beginning regarding making assumptions about what government agencies are saying! 
 
For Your Information - Q & A
Question:
Just a quick question. We have heard that some of our competition, mostly chiropractors, are offering monetary incentive to lawyers for referrals. Is that legal or relegated only to ethical?
 
Response: 
While this is specifically prohibited by N.J.A.C. 13:44E-2.6, there are much more serious legal consequences to such conduct on the part of the Chiropractor, and on your part. First and foremost, it is important to understand what obligations we have in such situations, because that addresses what we must do rather than what we "should" do. If we fail to meet these obligations, we can wind up implicating ourselves in any potential civil and/or criminal action. Aside from the reporting obligations that can be found in the ethical standards of a profession, which can be used in civil actions, there are legal requirements specific to NJ. These responsibilities are described in the "Health Care Professional Responsibility and Reporting Enhancement Act", often referred to as the Cullen Law, and referenced in the NJ Uniform Enforcement Act, which applies to all NJ regulated professionals. This law outlines both the reporting requirements, as well as the confidentiality and immunity from civil liability for such reporting, provided that the report was made "in good faith and without malice." While this law was written to primarily address suspected "impairments" in health care professionals, it also addresses "unprofessional conduct", and the payment of referral fees is defined in the Chiropractors regulations as "professional misconduct".
 
References:
STATE BOARD OF CHIROPRACTIC EXAMINERS
N.J.A.C. 13:44E-2.6 Referral fees
It shall be professional misconduct for a licensee to pay, offer to pay, or to receive from any person any fee or other form of compensation for the referral of a patient.
 
N.J.S.A. 45:1-37 Notification to division of impairment of health care professional.
12. a. A health care professional shall promptly notify the division if that health care professional is in possession of information which reasonably indicates that another health care professional has demonstrated an impairment, gross incompetence or unprofessional conduct which would present an imminent danger to an individual patient or to the public health, safety or welfare. A health care professional who fails to so notify the division is subject to disciplinary action and civil penalties pursuant to sections 8, 9 and 12 of P.L.1978, c.73 (C.45:1-21, 45:1-22 and 45:1-25).
 
Question:
Can you respond to the appropriate use of these modifiers for Medicare. It is my understanding that if a patient does not meet the Medicare definition of necessity, you can use the GY modifier to acknowledge this and get a denial to either bill the patient or submit to their secondary insurance.
 
Response:
Your understanding is not correct. The GA Modifier is used to indicate that the service on a claim is likely to be denied as not medically necessary. This may include patients where the progress will be so slow that Medicare would consider such progress to be insignificant, regardless of the skill involved in delivering the service. Another example might be when patient wishes to continue services beyond the point where you think they are necessary, such as palliative care. This modifier can only be used when you have provided and Advanced Beneficiary notice (ABN) to the patient prior to delivery of the service.
 
You should use the GY modifier on claims that the provider knows or thinks will be denied because the test or service is clearly never covered. An example might be a patient who is not currently under the care of a physician and comes to see you via direct access, or who wishes to receive performance improvement services, such as in a golf clinic. Medicare does not pay for services that are unrelated to improvement in ADLs, which does not include leisure and/or recreational activities.
 
If an ABN has not been issued prior to delivering the service you would submit the claim for service with the GZ modifier, which means that the claim will likely be denied and the patient will have no financial liability for that service. One would obviously hope that a provider never rendered a service without any guarantee of payment, unless they are knowingly and willingly doing so.
 
See below:
Use of the GA, GY, and GZ Modifiers for Services Billed to Carriers
The new GY modifier must be used when physicians, practitioners, or suppliers want to indicate that the item or service is statutorily non-covered (as defined in the Program Integrity Manual (PIM) Chapter 1, §2.3.3.B) or is not a Medicare benefit (as defined in the PIM, Chapter 1, §2.3.3.A).
 
Question:
What do you know about ARP treatment and who is qualified to perform it on the public? I know it is a form of E-stim, but do you have to be a licensed Health Care Professional to use it? There is someone in my area who took their "licensing course", but who does not appear to be a health care provider, and is advertising rehabilitation with the ARP and treating clients with it. Is there no governing body to protect the consumer on this type of issue? Thanks.
 
Response: 
Such a person should be reported to the Board of PT for the unlicensed practice of PT and/or the Board of Medical Examiners for the unlicensed practice of Medicine, which is a criminal offense punishable as a third-degree misdemeanor. These activities are within the purview of one or both Boards, and thus should be involved.
References:
N.J.S.A. 45:9-37.19 License required to practice, assist at, physical therapy.
 
9. No person shall practice physical therapy or act as a physical therapist assistant, whether or not compensation is received or expected, unless the person holds a valid license to practice in this State; however, nothing in this section shall be construed to:
 
a. Prohibit any student enrolled in a school or post-graduate course of physical therapy or in a course of study for training as a physical therapist assistant that is approved or recognized by the board from performing physical therapy or acting as a physical therapist assistant, as appropriate, which is necessary to his course of study;

b. Prohibit any person licensed to practice in this State under any other law from engaging in the practice for which the person is licensed, provided that: the procedures or duties performed by that person are within the scope of that person's practice as established by law and the accepted standards of practice of the profession for which the person is licensed; and the person does not represent himself as a physical therapist or physical therapist assistant; or
 
c. Prohibit any person employed by an agency, bureau or division of the federal government from practicing physical therapy within the scope of his official duties.
L.1983,c.296,s.9; amended 2003, c.18, s.5.

N.J.S.A. 2C:21-20 Unlicensed practice of medicine, surgery, podiatric medicine, crime of third degree.  A person is guilty of a crime of the third degree if he knowingly does not possess a license or permit to practice medicine and surgery or podiatric medicine, or knowingly has had the license or permit suspended, revoked or otherwise limited by an order entered by the State Board of Medical Examiners, and he:
a. engages in that practice;
b. exceeds the scope of practice permitted by the board order;
c. holds himself out to the public or any person as being eligible to engage in that practice;
d. engages in any activity for which such license or permit is a necessary prerequisite, including, but not limited to, the ordering of controlled dangerous substances or prescription legend drugs from a distributor or manufacturer; or
e. practices medicine or surgery or podiatric medicine under a false or assumed name or falsely impersonates another person licensed by the board.
L.1989,c.300,s.14; amended 2005, c.259, s.21
 
Preventing Sexual and Other Forms of Harassment in the Workplace
HIGHLIGHTS IN THE DEVELOPMENT OF THE LAW OF WORKPLACE HARASSMENT
  • 1964: The Civil Rights Act of 1964 prohibits employment discrimination on the basis of race, color, religion, national origin and sex. 
  • 1967: The Age Discrimination in Employment Act forbids employers to discriminate against individuals, over 40, on the basis of their age.
  • 1968: The Equal Employment Opportunity Commission (EEOC), the agency that enforces federal antidiscrimination laws, finds that an employer engaged in national origin discrimination by permitting employees to harass a Polish-born co-worker with demeaning conduct such as making him the butt of "Polish" jokes.
  • 1980: The EEOC issues guidelines interpreting Title VII to forbid sexual harassment as a form of sex discrimination.
  • 1981: A U.S. appeals court endorses the EEOC's position that Title VII forbids sexual insults and propositions that create a "sexually hostile environment," even if the employee lost no tangible job benefits as a result.
  • 1986: the U.S. Supreme Court rules that a woman who allegedly had sex with her boss because she feared losing her job if she did not, could sue for sexual harassment. The question is not whether her conduct was voluntary but whether the boss's conduct was unwelcome. An employer is liable for sexual harassment committed by supervisors if it knew or should have known about the conduct and did nothing to correct it.
  • 1990: The EEOC issues a policy statement saying that sexual favoritism, if advances are unwelcome or favoritism is so widespread as to be an unspoken condition of employment, can be sexual harassment.
  • 1998: the U.S. Supreme Court creates a new rule for employer liability where a supervisor creates a hostile environment for a subordinate: an employer is liable for an actionable hostile environment created by a supervisor who has immediate (or successively higher) authority over the victimized employee if the harassment results in a tangible employment action, such as a dismissal or a denial of promotion.
  • 1998: the U.S. Supreme Court creates a new rule for employer liability cont.:  The employer is also liable for a hostile environment created by a supervisor even where no tangible employment action has occurred, unless (1) the employer has taken reasonable care to prevent and correct sexual harassment, and (2) the employee unreasonably has failed to avoid harm. Proof that the employee failed to use the employer's complaint procedure usually will be enough to show unreasonable failure to avoid harm.
  • 1999: The U.S. Supreme Court held in a case that an employer can avoid punitive damages for discrimination if it has implemented, in good faith, an antidiscrimination policy.
  • 2004: The U.S. Supreme Court holds that in some sexual harassment cases the employer can avoid liability by establishing both the reasonable care by the employer to prevent and correct harassment and unreasonable failure by the employee to avoid harm.
 
 EMPLOYER POLICY MUST BE CLEAR AND, IDEALLY, PART OF A CORPORATE COMPLIANCE PROGRAM
  • A prohibition of harassing conduct
  • Zero tolerance for harassing conduct
  • All employees, regardless of rank, must comply with the policy
  • All complaints must be reported to the Compliance Officer to ensure that complaints can be investigated impartially as well as promptly
  • All complaints must be investigated discreetly, preserving confidentiality as much as possible
  • Employees found to have engaged in inappropriate conduct must be subject to discipline, up to and including dismissal
  • Retaliation must be prohibited against any employee who reports harassment or who cooperates with the investigating of that report
  • Vulgar language must be avoided because it contributes toward a hostile work environment
  • Work-related off-premises conduct must be viewed the same as on-premises conduct
  • Touching: It is easy to believe that physical touching can be consoling, however, "hands on " management often has gone too far. In some cases a single incident of sexual touching has created liability. Ask yourself: is touching one's fellow employee beyond a handshake really necessary?
  • Visual displays: Posters, graffiti, and other displays that address sex, race or religion can be offensive
  • Avoid talking dirty and telling jokes
  • Email: Evidence of harassing behavior has often come in the form of email communications.
CRITICAL STEP: IMPLEMENT A CORPORATE COMPLIANCE PROGRAM WHICH SHOULD INCLUDE A POLICY AND PROCEDURE TOWARDS PREVENTING SEXUAL AND OTHER FORMS OF WORKPLACE HARASSMENT.

Mailly Inglett & Barmak, LLC  
Ken Mailly, PT, MPA, NJ Lic. # NJ40QAOO335900
 
Ken is a graduate of the State University of New York at Downstate Medical Center, and completed his Master's in Public Administration at Seton Hall University, with a concentration in Health Care Policy and Management. He is also certified as an Ergonomic Specialist, and as a Rehabilitation Agency Medicare Surveyor.

In addition to his graduate studies, with well over 2,500 hours of continuing physical therapy education, Ken has amassed an extremely diverse and extensive knowledge of the clinical practice of physical therapy, rehabilitation, and practice management. Ken's primary clinical focus is in orthopedics, chronic soft tissue disorders, and management of patients with bleeding disorders.

Along with this clinical knowledge base, Ken has devoted the last 10 years to the study of regulation, legislation, and reimbursement for physical therapy & rehabilitation services. He has served as an expert witness, on behalf of both plaintiffs and defendants, in numerous malpractice cases. He has also been consulted on state, federal, and third party payer inquiries regarding physical therapy and rehabilitation billing, regulatory, and legal issues.
 
Ken is a partner in Mailly & Inglett Consulting. His focus is on compliance with professional standards, state and federal regulations, as well as practice management strategies.
 
Barry G. Inglett, PT, CHT, Cert. MDT, NJ Lic # NJ40QA00146200
 
Barry is a graduate of Columbia University, a Certified Hand Therapist and a Credentialed McKenzie Therapist. He is a physical therapist and co-owner of Wayne Physical Therapy & Spine Center, a private practice established in 1977. Barry is also a partner in Mailly & Inglett Consulting, working with both physical therapists and Payers.
 
Barry is a guest lecturer for UMDNJ's Physical Therapy Program as well as a clinical instructor for several colleges including Columbia University, New York University, Temple University, Stockton State College, Kean College and the University of Medicine and Dentistry's Physical Therapy Program. He is also an instructor for HMW (Human Mechanical Wellness) Seminars, specializing in mechanically oriented treatment programs for the spine and extremities.

Barry has been retained by numerous insurance companies as well as the New Jersey Attorney General's Office offering expert witness testimony in physical therapy practice. He has been involved in utilization review and reimbursement issues in physical therapy for over 20 years. Barry also instituted, and was retained as the lead expert, in the largest PT fraud case in NJ history (Cobo v. MTF). He also served as a physical therapy consultant from 1997-2005 for Horizon Healthcare running the NJ Plus pre-certification program. Barry has served on the New Jersey Board of Physical Therapy Examiners in the past for eight years and has also served as the Chairman of the Board of Physical Therapy Examiners.

David S. Barmak, Esq.
 
David S. Barmak, Esq. received a JD from Cornell University and a BA from Duke University. The Law Offices Of David S. Barmak, LLC was established in 1984. David is licensed to practice law and has clients in the states of New York, New Jersey, Pennsylvania and Connecticut.
 
David's legal focus is in the areas of corporate compliance, risk management, human resources and operational legal affairs.
 
David has a strong background in operations, having served as both the Associate Administrator and General Counsel for a large New York Certified Home Health Agency, initiating and directing a New York Licensed Home Care Services Agency as well as owning and operating a Durable Medical Equipment company. David also provides defense of enterprises, directors, officers and other professionals accused of misconduct.
 
For more information, please contact us:
 
Mailly Inglett & Barmak, LLC
info@maillyinglettbarmak.com
Telephone (609) 688-1188
Fax (609) 688-1199
www.MaillyInglettBarmak.com
 
© Copyright, 2010. Mailly Inglett & Barmak, LLC. All rights reserved. No portion of these materials may be reproduced by any means without the advance permission of the author.