(July 19, 2013): Health care providers choosing to participate in Medicare, Medicaid and other Federal health benefits programs are obligated to comply with a wide range of statutory and regulatory requirements. The primary issues most cited in connection with these obligations include those involving questions of medical necessity and / or coverage, coding and billing requirements and documentation mandates. Health care providers are also required to comply with applicable employment laws, OSHA safety requirements, and with the medical records privacy rules of HIPAA and HITECH. Collectively, these laws and regulations represent a significant challenge for many small and mid-sized health care providers and organizations. Nevertheless, it is essential that all health care providers also keep in mind that Federal law also prevents participating providers from engaging in disability discrimination.
I. Regulatory Requirements Governing Participating Providers:
Pursuant to Section 504 of the Rehabilitation Act of 1973, as amended (Act), and its implementing regulations, 45 C.F.R. Parts 81 and 84.1, health care providers participating in programs receiving Federal funding cannot refuse to treat a patient on the basis of the patient’s disability. At first blush, you may find it hard to imagine how (or why) a health care provider would ever even consider refusing to care or treat a disabled patient because of the patient’s disability. The case outlined below provide a stark example of how disability discrimination can result in serious administrative sanctions being pursued against a health care provider.
II. Overview of a Recent Case:
The following summarizes the allegeg acts which gave rise to an enforcement action by the Department of Health and Human Services (HHS), Office of Civil Rights (OCR):
- A California physician who practices neurological surgery (surgeon) examined a patient covered by “MediCal,” California’s Medicaid program. Medi-Cal is jointly financed by Federal and State funds.
- The patient suffered from hip and back pain and was referred to this surgeon for evaluation and treatment by his primary care physician.
- After examining the patient, the surgeon recommended that the patient undergo surgery. The patient then agreed to seek pre-authorization for the procedure by Medi-Cal.
- The surgeon subsequently learned that the patient was reported to be HIV positive.
- The patient was recalled by the surgeon and was asked if, in fact, he was HIV positive. When the patient responded affirmatively, the neurological surgeon then reportedly advised the patient that he would be unable to perform the surgery and recommended that the patient seek to have the procedure performed at the county hospital.
- The neurological surgeon then discharged the patient from his practice “and, in correspondence advising the referring physician that he had done so, specifically mentioned that the young man was HIV-positive.”
(For a more detailed discussion of the facts in this case, you may wish to review the decision of the HHS Departmental Appeals Board).
A discrimination complaint was subsequently filed against the surgeon by the patient with OCR. Consistent with applicable regulations, OCR is documented as having tried “to the fullest extent practicable,” to obtain the surgeon’s cooperation. See 45 C.F.R. § 80.6(a).
Once it concluded that an information resolution of this discrimination complaint would not be forthcoming, OCR recommended that the HHS take action to suspend or terminate the recipient’s federal financial assistance. See 45 C.F.R. § 80.8(c).
On or about August 2, 2012, that is precisely what occurred. An Administrative Law Judge (ALJ) for the HHS’ Departmental Appeals Board determined that the surgeon’s:
“lack of cooperation establishes that he will not voluntarily comply with the Act and regulations and that OCR will not be able to assure his compliance by informal means. Termination of his federal financial participation is therefore an appropriate remedy for his refusal to comply voluntarily. 45 C.F.R. § 80.8(c).”
In reaching this conclusion, the ALJ then ordered:
“I therefore order that the responsible HHS officials suspend, terminate, refuse to grant or continue [Surgeon’s] Federal financial assistance, until he satisfies those officials that he will comply with the Act and regulations. As a review of the record shows, it appears that OCR made multiple settlement overtures to resolve the complaint with the surgeon but that its efforts were ultimately unsuccessful.”
III. Disability Discrimination Lessons Learned:
As a review of the Opinion issued by the Departmental Appeals Board will show, OCR diligently attempted to resolve this issue with the surgeon informally, prior to taking this case forward. Now that the surgeon has been effectively suspended from receiving Federal funds, he is effectively barred from treating Medi-Cal patients. While additionals sanctions involving Medicare and other Federal health benefits programs could later take place, no discussion of these programs is covered in the ALJ’s opinion. Nevertheless, what are some of the potential actions that could conceivably take place in the future?
(1) From a public relations standpoint, this action could be disastrous for a health care provider’s practice.
(2) Depending on how the action is worded and how it is perceived by State licensure officials, this action could result in an investigation and possible sanctions by a State Medical Board.
(3) Most, if not all, private payors require that health care providers give them written notice of any adverse actions taken by another payor within 30 – 60 days. This action could therefore result in the proposed de-credentialing of the surgeon from one or more private plans.
(4) Many hospitals require that a health care provider be a participating provider in the Medicare and / or Medicaid programs in order for them to receive admitting privileges in their institution. An adverse action such as this against a provider’s Medicaid status could result in action being taken by hospitals where the provider is privileged.
Notably, the decision in this case is not the same as an exclusion action. In fact, the way it is worded almost implies that if the surgeon takes remedial action, his Medi-Cal eligibility will be reinstated.
As a final point, this case clearly illustrates OCR’s emergence as an enforcement agency to be reckoned with. While prior administrative enforcement sanctions have focused on Civil Monetary Penalties (CMPs), this action effectively suspends a health care provider’s ability to participate in Medicaid, short of seeking a permissive exclusion action against the provider.
From a regulatory standpoint, this case can serve as a real-life example of the importance of developing and implementing a comprehensive, effective Compliance Program.
Robert W. Liles, J.D., M.B.A., M.S., serves as Managing Partner at Liles Parker PLLC, a boutique health law firm with offices in Washington, DC, Texas and Louisiana. Liles Parker attorneys represent health care providers around the country in compliance, regulatory and peer review related actions. Should you need assistance, feel free to give us a call. Call Robert for complimentary initial consultation at: 1 (800) 475-1906.