OIG advisory opinion clarifies some call issues

Paying 'fair market' rates is a key factor

The Department of Health and Human Services' Office of Inspector General (OIG) has responded to a request for an advisory opinion on the on-call coverage and uncompensated care arrangement established by an unnamed not-for-profit medical center. In so doing, it provides new guidance for ED managers who are establishing, reviewing, or amending their own on-call arrangements, and it could, according to some sources, impact most on-call arrangements in the United States.

The facility's arrangement includes participation in call rotation, inpatient and consultative services, timely response to calls, cooperation with care management/risk management and quality initiatives, and medical record completion. In return, the on-call physicians are paid a per diem rate that the center certifies to be "fair market value," and they also must donate 18 days of pro bono call per year.

As long as the per diem rates are fair market value, the OIG opines, this "lowers the risk that the Arrangement is a vehicle to disguise payments for referrals," which would be a violation of the anti-kickback statute. It adds that other features of the arrangement seem to protect against fraud and abuse, and that there was a legitimate need for the coverage. (For information on how to obtain a free copy of the opinion, see the source information at the end of this article.)

Despite the fact the OIG stressed that this "advisory opinion has no application to, and cannot be relied upon by, any other individual or entity," emergency medicine experts argue that ED managers can draw some implications from the opinion. "This opinion has a lot of significance," argues Robert Bitterman, MD, JD, FACEP, president of Bitterman Health Law Consulting Group in Harbor Springs, MI. "The first thing is, they allowed it; if they had not, it would make it much more difficult to allow any type of [on-call coverage] program."

While OIG emphasized that each case should be looked at individually, it did lay out the facts that were considered and where they think the pitfalls and central problems exist, he says. "The fact that they put it in writing gives hospitals and ED physicians 12 pages of their opinions — benchmarks to look at and concepts to consider when they go about paying doctors to take calls."

So, for example, it illustrates the kind of agreement that would not be in violation of the anti-kickback statute which, quite simply, "says hospitals cannot pay physicians for referrals, but they can hire them for specific reasons and pay them at a fair market rate to provide those services," according to Bitterman. Thus, the per diem rate ensures the physicians will be available to admit, consult, and take care of the patient through hospitalization, he says. "It says to the physician that you must adjust your practice and lifestyle to perform these duties," Bitterman adds.

So, what is a "reasonable" amount to pay for such services? "I have to think that any good faith effort, and as long as the service is be provided, meets the test," he says.

Not all experts agree with Bitterman. "I'm not sure it will have a lot of impact," says Michael Frank, MD, JD, general counsel for Emergency Medicine Physicians in Canton, OH. It is a little bit of a "Johnny-come-lately" response in that the practice of paying to take call has been in progress for several years, he says.

"The big question unanswered here is whether this same opinion would apply to those arrangements where the physician is not only paid to take call, but paid for the services they provide both in the ED and in the hospitals," he says. Frank notes that he is aware that many physicians demand not only a fixed payment for being on call, but also to be paid for the services they provide as well, while the hospital is left to worry about the billing.

As Bitterman reads it, the OIG opinion does address that issue. "Let's say you pay me $1,000 to come in. Now, when I come in, I want to bill for each time I provide care," he posits. "My question is, is that fair market compensation?"

The on-call physicians, for example, have to be available within 30 minutes, "So you can't be doing any two-hour elective cases while on call." Being available, he argues, has a value to it as well.

Bitterman adds that the per diem rate is really a "package deal" that pays for your availability and what you actually do in the ED. "You have to look at the totality of circumstances," he says.

There is one issue on which Frank and Bitterman are in clear agreement. Frank says, "The reality is that [the opinion] provides good guidance and to the extent that facts in your situation apply [to this case], OIG may not be prosecuting you."

Bitterman adds, "If you are an ED manager and you pay physicians anything for taking call, you have to read this closely to see how your agreement measures up."


For more information on interpreting the advisory opinion, contact:

  • Robert Bitterman, MD, JD, FACEP, President, Bitterman Health Law Consulting Group, 5295 Greystone Lane, Harbor Springs, MI 49740. Phone: (231) 526-7970. E-mail: robertbitterman@gmail.com. Web: www.robertbitterman.com.
  • Michael Frank, MD, JD, General Counsel, Emergency Medicine Physicians, 4535 Dressler Road, Canton, OH 44718. Phone: (330) 493-4443.

To download a copy of the advisory opinion, go to: oig.hhs.gov/fraud/advisoryopinions/opinions.html. Scroll down to "9/27/07," and click on "Advisory Opinion 07-10."