Insights from Ludi

“You can’t manage what you don’t measure.” This is not a new business axiom. And, it rings particularly true for hospitals when it comes to physician administrative contracts.

I worked for a large non-for-profit system “papering” physician employment, loans, and other physician alignment strategies. I regarded compliance as a necessary evil.

It’s actually smart to conduct your organization’s business within in the bounds of federal regulations. The Department of Justice (DOJ) hasn’t taken 2018 off and when they hit an organization, the fine tends to go big. And, now it’s even personal – healthcare executives are being given prison time. As one Ludi™ client has stated, “Orange is not my color.”

This year’s 22^nd Annual Compliance Institute in Las Vegas is off to a great start with amazing keynote speakers and informative sessions. If I had to describe a theme of the sessions and the conference, it would be connectivity. Compliance is not one person’s job alone in an organization, but a culture. Doing the right thing should be our priority and working across the organization is necessary. Legal, audit, risk, operations, leadership, the medical staff all must be rowing in the right direction!

Today hospitals still face many regulatory and compliance risks. However, we aren’t out of luck quite yet, because there are several ways hospitals can reduce these types risks. Here, we highlight six ways to avoid costly fines and settlements specifically related to physician compensation practices.

At Ludi, our sole focus is physician administrative contracts. These are the legal vehicles that contain a variety of administrative services that physicians provide to hospitals that are not clinical. These services include medical directorships, on-call, co-management agreements, and physician committee work to name a few. We work with various sizes of health systems and have noticed several patterns, regardless of size, that all hospital administrative teams fall into when automating their manual processes that currently support their payment processes and executive of their physician contracts.

Managing your hospital’s relationships with physicians can seem nearly impossible due to the compliance landscape that surrounds them. In order to keep your physicians happy and your hospital compliant, you need the right physician management strategies in place, beginning with the physician contract.

In September, 2015, the Department of Justice (DOJ) published the Yates Memo, a document outlining the accountability of individuals for corporate wrongdoing. This means that any individuals responsible (whether knowingly or unknowingly) for the wrongdoing are now being involved in the case where all facts of the alleged crime must be disclosed to the DOJ. Hospital executives fall into this area of accountability and since the release of the Yates Memo we are now seeing the punishment of individuals.

The four top areas for regulatory risk for hospitals include: Patient privacy, coding, quality, and physician agreements. Physician agreements tend to have the most opportunity for points of failure due to the process, structure, and people involved in making sure agreements are appropriately written and managed over time.

Read through the following 5 tips and consider them a guideline to lower your risk related to physician agreements: