Physician administrative agreements are complex largely because of the challenging compliance regulations they must follow. Based on the thousands of agreements we’ve read on behalf of our clients, there is a cycle taking place where the agreements are getting more complicated as the compliance landscape becomes more rigid. This can create a series of problems when it comes to writing and managing these agreements over time. Take a read through the physician contracting errors that we’ve seen throughout agreements that can cause both short and long-term problems.
Over the last five years, the industry has been largely focused on ensuring physicians have an Electronic Medical Record (EMR) in their private practices to capture clinical practice time. There has been a focus on capturing the work flow to collect the clinical documentation and to ensure the appropriate variables are accurate for billing. These systems are expensive and time consuming to implement.
The regulatory environment is deep with rules governing how healthcare organizations (HCO) behave. One particularly strict law is the Stark Law, governing how HCOs interact with referring physicians. The law prevents HCOs from paying physicians unless a safe harbor is met. Assuming the HCO takes proper care in setting up this agreement, problems can still arise in how the agreement is operationally managed over time. If not followed exactly as written, the organization may fall outside the safe harbor rendering the organization in violation. Because the law is non-intent based, the OIG will not be swayed if the HCO inadvertently violates the law. Meaning, even if there is a technical violation of the law, the full wrath of the law applies.
Many hospitals have embraced the Lean Six Sigma method to collaboratively identify opportunities and reduce waste. Some hospitals even have teams that shine a laser focus on large cost savings opportunities. These projects are collaborative and can also take time and resources to manage appropriately. We have thought of a handful of ways that are rooted in the Lean approach but also take advantage of the work that has been performed by others to date. These four findings aim to improve your hospital's physician agreements and how you manage them. These could be any of the following: an employment agreement, a medical directorship, an on-call agreement, a research agreement or a teaching agreement.