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NFLPA Collusion Suit Against NFL Alleges Conspiracy

(May 24, 2012): NFLPA Collusion SuitAre the Washington Redskins and Dallas Cowboys, the greatest rivals across all sports, finally working together? Not exactly, but penalties recently imposed on both teams have served as a catalyst, in part, for the National Football League Players Association (NFLPA) to file an antitrust suit against the National Football League (NFL) for allegedly conspiring to set a secret salary cap during the 2010 season. The NFLPA collusion suit alleges that the NFL and the owners of the NFL teams conspired to secretly maintain a $123 million salary cap (a maximum amount each team can pay its players) when publicly maintaining that the 2010 season was not subject to a salary cap. In essence, the antitrust suit alleges that NFL players were damaged by the NFL because they did not receive the salary amounts they could have earned had the season truly been uncapped.

I.  What is Antitrust?

Antitrust laws have existed in the United States for over a century. Starting with the Sherman Antitrust Act of 1890, this body of law has grown to encompass any type of collusive activity which is anti-competitive. Collusion refers to two or more individuals or entities secretly working together to impede competition (defined broadly) in a market. In the NFLPA collusion suit, the competition alleged to have been impeded is in the players’ market, with the NFL tacitly agreeing to not pay players more than a combined $123 million. Because the Redskins and Cowboys violated this tacit agreement by going above this $123 million threshold and “front-loading” many of their free agent contracts, the NFL imposed sanctions against the organizations.

Antitrust cases generally come in two flavors: cases where a company is exercising or attempting to exercise monopoly power, and cases where companies are colluding to restrain trade and competition. In the second type, cases are very categorized into either “per se illegal” collusion or restrain reviewed under the “rule of reason” which balances all the competitive efficiencies and the anti-competitive harms.

While much of this case will be based on procedural issues, such as whether the NFLPA had already released its claims against the NFL (thereby invalidating the NFLPA collusion suit), it is an interesting legal battle from an anti-competitive standpoint as well. Antitrust litigation often comes down to creating a “story” of antitrust harms or, conversely, pro-competitive efficiencies, and this case will probably be no exception. This case is important in other industries, however, because the NFLPA and NFL’s prior dealings and communications are relatively commonplace business dealings for unions and owners. Moreover, in franchised organizations, this case begs the question of whether collusion between franchise owners can create liability for the entire organization.

II. Why Should Healthcare Providers Care?

The NFLPA collusion suit has many similar elements to cases involving unionized workers in any industry. This is especially true when considering healthcare labor relations. For instance, the recent case of Cason-Merenda et al. v. Detroit Medical Center et al., which involved eight Detroit-area hospitals and the unionized nurses working in those hospitals, highlights the importance of owners of healthcare facilities ensuring compliance with federal trade and labor laws. 2012 WL 995293 (E.D. Mich. 2012). In that case, area nurses filed suit, alleging that the hospitals had colluded to hold down wages paid to the nurses, and had illegally exchanged information about wages and employment of their nurses. Most recently, Detroit Medical Center’s Motion for Summary Judgment was partially denied as to the “Rule of Reason” claims, with litigation still ongoing.

Nevertheless, healthcare providers should recognize that the Federal Trade Commission (FTC) and Department of Justice (DOJ) have long scrutinized the actions of healthcare providers. Whether it is in labor and employment relations or buying, selling, or merging healthcare assets, FTC and DOJ are quick to investigate collusive claims against healthcare entities, as they often lead to anti-competitive effects and price increases for consumers. The NFLPA collusion suit, while in a different industry, effectively demonstrates the legal problems which could affect healthcare providers.

Healthcare LawyerLes Johnson is a Partner in the Baton Rouge office of Liles Parker. As the Co-Leader of the Health Law Practice Group, Les works with the firm’s healthcare clients  on a variety of business matters, including fraud and abuse, compliance, and mergers and acquisitions. For a free consultation to discuss your healthcare organization’s business matters, call Les today at: 1 (800) 475-1906.

Connolly Posts New Issue for Hospice Billing

(April 12, 2012): The Centers for Medicare & Medicaid Services (CMS) recently approved a new Recovery Auditor (RAC) Audit Issue for use by Connolly Healthcare in its audits of hospice billing in Region C. The new audit issue, CMS Issue Number C000162012, concerns services that are bundled with the hospice’s per diem payment.  Details on the new RAC audit issue are below :

Issue Name:Hospice Related Services –Outpatient CMS Issue Number: C000162012
Description:Services related to a Hospice terminal diagnosis provided during a Hospice period are included in the Hospice payment and are not paid separately.
Provider Type Affected:Outpatient Hospital-Unspecified
Date of Service:10/01/2007 – Open
States Affected:Alabama, Arkansas, Colorado, Florida, Georgia, Louisiana, Mississippi, New Mexico, North Carolina, Oklahoma, Puerto Rico, South Carolina, Tennessee, Texas, Virgin Islands, Virginia, and West Virginia.
Additional Information:https://www.cms.gov/manuals/downloads/clm104c11.pdfhttp://www.cms.gov/manuals/Downloads/bp102c09.pdf

(source: http://www.connolly.com/healthcare/pages/ApprovedIssues.aspx)

Based on the issue posting above, the new issue seems to be focused on services billed by outpatient hospitals during a hospice period that should have been considered bundled with the hospice’s institutional payment and not separately billable.  However, the rules on hospice billing for services that are not related to a patient’s terminal illness during a covered hospice period are both complex and relevant to physicians and others providers outside of the outpatient hospital environment, so a brief overview of the rules may be helpful for them as well.

The manual provisions cited in the Audit Issue announcement are to the chapters of the Medicare Benefit Policy Manual and the Medicare Claims Processing Manual covering hospice services.  Section 50 in Chapter 11 of the Medicare Claims Processing Manual explains the rules for hospice billing and payment for services unrelated to a patient’s terminal illness (and therefore separately billable). That section states that “[a]ny covered Medicare services not related to the treatment of the terminal condition for which hospice care was elected, and which are furnished during a hospice election period, may be billed by the rendering provider using professional or institutional claims for non-hospice Medicare payment.” It goes on to state that professional claims for services unrelated to a hospice patient’s terminal illness must be billed with the “GW” modifier as a “service not related to the hospice patient’s terminal condition.” For institutional claims, the services must be coded with condition code “07” for “Treatment of Non-terminal Condition for Hospice.”  The section also states that contractors can conduct prepayment or post-payment reviews to validate that services billed with the GW modifier or condition code 07 were actually unrelated to the patient’s terminal illness. With the posting of CMS Issue Number C000162012, it seems that Connolly Healthcare will be conducting post-payment reviews to do just that.

Providers should review their use of the GW modifier (for professional claims) and condition code 07 (for institutional claims) to ensure that they are properly coding and billing for these services. Consider revising your facility’s documentation practices to ensure that supplemental services unrelated to the patient’s terminal illness are clearly delineated.

Les Johnson Healthcare AttorneyLes Johnson, J.D., LL.M. is Partner at Liles Parker PLLC and is Co-Leader of the firm’s national Health Law Practice Group. He practices out of the firm’s Baton Rouge, LA office. If you have any questions regarding the issues described above or any other questions about a RAC, ZPIC or other Medicare audit, you can reach Mr. Johnson at 225-244-9400 or by email to LJohnson@lilesparker.com for a free consultation.