Louisiana Law Blog

by Valerie A. Judice

On June 10, 2008, Michael O. Leavitt, Secretary of the Department of Health and Human Services (DHHS) announced that Louisiana was one of twelve (12) communities chosen to participate in an Electronic Health Records Medicare Demonstration Project. The project will last five (5) years and will provide physicians with financial incentives to use certified electronic health records (EHRs). Incentive payments for the entire 5-year period may reach $58,000 per physician and $290,000 per practice.  

by Linda G. Rodrigue

In Advisory Opinion No. 08-05, issued February 15, 2008, the OIG concluded that an arrangement whereby a pharmaceutical company placed electronic kiosks in physician offices would not generate prohibited remuneration under the anti-kickback statute. Further, the OIG opined that the arrangement would not violate the federal prohibition against giving anything of value to a Medicare or Medicaid beneficiary that is likely to influence the beneficiary’s selection of a particular provider.

By Deborah Juneau

The Louisiana Supreme Court issued its new opinion after a rehearing in Borel v. Young, again affirming the Third Circuit’s ruling and dismissing the lawsuit against late-added physician defendants, but on different grounds. The supreme court’s decision on rehearing solved an apparent dilemma for the plaintiffs created by the original opinion: the plaintiffs were precluded from filing suit until after the medical review panel had rendered an opinion but, in any case, were required to file suit within three years of the alleged medical malpractice. Since the three year period could not be suspended during the pendency of the medical review panel, the plaintiffs faced the possibility that their claims would be barred by the three-year peremptive period before the panel convened to consider their claims.

by Clay J. Countryman

The Centers for Medicare and Medicaid Services (“CMS”) recently issued on June 8, 2008 an advisory opinion in which CMS addressed whether a proposed physician ownership in a diagnostic center complies with the rural provider exception to the Stark Law. CMS concluded that the facts of the proposed physician ownership in the diagnostic center would satisfy the rural provider exception, but CMS also cautioned that meeting the elements of the rural provider exception is an ongoing requirement and must be continuously satisfied during the period of a physician’s ownership interest.

by Linda G. Rodrigue

On April 16, 2008, the Louisiana Third Circuit Court of Appeal upheld a trial judge’s application of a 35% minority discount in determining the fair market value of the interest of a partner withdrawing from a limited liability partnership (LLP). It appears that the Supreme Court has been asked to consider this case, but has not yet made a determination of whether to do so. Accordingly, this decision may or may not be final, and although it did not involve a health care entity, it is instructive for health law purposes.

By Clay J. Countryman

On May 30, 2008, the Centers for Medicare & Medicaid Services (CMS) issued an Advisory Opinion regarding a proposed arrangement under which a hospital system would license a custom software interface for use by the physicians on its medical staffs. The specific question addressed by CMS was whether the provision of the custom software interface by the hospital system to its medical staff physicians would create a compensation arrangement for purposes of implicating the self-referral prohibition of the Stark Law.

By Deborah Juneau

The Louisiana Supreme Court recently held in Borel v. Young that La. R. S. 9:5826(A) provided for both a one year prescriptive period and a three year peremptive period to file a claim for medical malpractice. The decision in Borel made it clear that a plaintiff had to file suit against a health care provider no later than three years from the date of the alleged act, omission, or negligence giving rise to the claim. Otherwise, the plaintiff’s action would be extinguished, and all rights to pursue the action would be lost. This ruling was favorable to health care providers, as it protected them from stale claims being brought years after the date of the alleged malpractice. However, the Louisiana Supreme Court granted a rehearing of the Borel v. Young case on May 21, and it remains to be seen whether the current ruling will stand or whether it will be modified or vacated.

La. R. S. 9:5826(A) governs the time limitations in which a party may bring a medical malpractice action against a health care provider. To understand the significance of the Borel ruling, one must understand the crucial difference between a prescriptive period and a peremptive period. A prescriptive period designates the deadline by which an action must be brought. However, prescriptive periods can be suspended, interrupted, or renounced by a variety of occurrences. Peremption is defined as a period of time fixed by law for the existence of a right. Unlike a prescriptive period, a peremptive period cannot be renounced, interrupted or suspended. Therefore, the right to bring an action against a health care provider would cease to exist if not timely exercised within three years after the date of the alleged act, omission or negligence.

by Valerie A. Judice

On September 26, 2007, the Louisiana Second Circuit Court of Appeal upheld the judgment of the First Judicial District Court in Caddo Parish in finding that the noncompetition and nonsolicitation clauses in a contract between a urology clinic and a professional medical corporation ("PMC") were enforceable as to the physician who had formed the PMC. Regional Urology, L.L.C., et al v. David T. Price, M.D. and David T. Price, M.D., A Professional Medical Corporation, 42-789 (La.App. 2^{ndrehearing denied 10/18/07.}  Cir. 9/26/07), 966 So.2d 1087,

The clauses at issue were part of an independent contractor agreement between David Price, M.D., A Professional Medical Corporation (PMC) and Regional Urology, L.L.C. (Regional Urology). Dr. Price was not a named party to the contract in his individual capacity. The contract prevented competition and solicitation by David Price, M.D., PMC for a period of 2 years in Caddo and Bossier Parishes. In addition, the contract provided that it would "apply to any physician who is a Member, any corporation which is Member or any physician's L.L.C. which is a Member of Regional Urology, L.L.C."

by Linda G. Rodrigue

On December 4, 2007, Phase III of the Stark Law’s regulations became effective. They include some significant substantive changes, one of which is a change to the professional courtesy exception. This change is likely to have a significant effect on many designated health service (“DHS”) providers, as those entities are defined by the Stark Law. DHS providers that have a professional courtesy policy would be well-served to review it and take appropriate action in light of the new regulations.

by Linda G. Rodrigue

On November 2, 2007, the Louisiana Court of Appeal for the First Circuit ruled that the Louisiana Medicaid Program may not recoup payments from a health care provider participating in Medicaid based solely on a billing record review when the basis for the alleged overpayment is that the services were not medically necessary. In Doc’s Clinic, APMC v. Louisiana Department of Health and Hospitals, No. 2007 CA 0480 (La.App. 1 Cir. 11/2/07), Doc’s Clinic appealed an Administrative Law Judge’s decision affirming an alleged overpayment of approximately $260,000.00. The Louisiana Department of Health and Hospitals (“DHH”) alleged that Doc’s Clinic had billed for medically unnecessary services, based on a billing record review by a nurse, with some assistance from a physician. DHH originally notified Doc’s Clinic of not only the alleged overpayment amount, but also of DHH’s intention to exclude the provider from the Medicaid Program participation.

by Linda G. Rodrigue

The United States Court of Appeals for the Ninth Circuit recently upheld the health care fraud conviction of a mental health clinic owner in Idaho, ruling that proof of intent to defraud can be made by showing reckless indifference to the truth or falsity of statements in health care cases. The Ninth Circuit Court of Appeals case is entitled United States v. Dearing, No. 06-30606 (9th Cir. 9/25/07). The reckless indifference standard, which has long been a standard for civil liability in cases brought under the Federal Civil False Claims Act, 31 U.S.C. §3729, et seq., was cited as being sufficient to uphold a criminal conviction under 18 U.S.C. §1347, a federal criminal health care fraud statute.

by Valerie A. Judice

On October 19, 2007, the Department of Health and Human Services Office of Inspector General (OIG) posted Advisory Opinion No. 07-13 concerning ownership in ophthalmology Ambulatory Surgical Centers (ASCs). The Advisory Opinion can be found at http://www.oig.hhs.gov/fraud/docs/advisoryopinions/2007/AdvOpn07-13.pdf

A group practice and a surgical center requested an opinion from the OIG regarding whether a Proposed Arrangement would violate the anti-kickback statute. The Proposed Arrangement called for the addition of optometrists as owners of three single-specialty ophthalmology ASCs.  

The Kean Miller Healthcare Regulatory team will present an informative seminar on the new Stark III regulations on Wednesday, November 14th from 5:30 to 8:00 p.m. at Juban's Restaurant in Baton Rouge.

Topics will include physician recruitment and compensation, non-monetary gifts, hospital ownership and investment by physicians, professional services agreements, radiology arrangements, and equipment and office lease arrangements.

Here is a program description.

by Valerie A. Judice

The Department of Health and Human Services Office of Inspector General (OIG) issued its Fiscal Year 2008 Work Plan on October 1, 2007. The OIG annual Work Plan gives an advance preview of what issues the OIG has on its radar for the upcoming year. 

The OIG stated in its opening message of the Work Plan that it will continue to concentrate its efforts in evaluating and investigating Medicare and Medicare programs, representing 80% of its resources.  The remaining 20% of the OIG resources will be spent on public health and human services programs. 

Target areas for the OIG in 2008 include: Long Term Care Hospitals (LTCHs), patient care and safety at physician-owed specialty hospitals, accreditation of hospitals, and “place of service” for physician coding.

by Clay J. Countryman

The Centers for Medicare & Medicaid Services (CMS) issued an advisory opinion on October 5, 2007 regarding the Physician Recruitment Exception to the federal physician self-referral prohibition, otherwise known as the Stark Law.  In this advisory opinion, CMS essentially concluded that a hospital could not amend an existing physician recruitment agreement to delete a provision requiring the physician to pay back monies under an income guarantee to the hospital during the financial guarantee period of the agreement.

by Clay J. Countryman

The Centers for Medicare and Medicaid Services (CMS) published on September 5, 2007 the long-awaited Phase III of the federal regulations of the physician self-referral prohibition commonly known as the Stark Law. CMS commented that the Phase III regulations finalize, and respond to public comments to the first two phases, or Phase I and Phase II, of the rulemaking process by CMS to adopt regulations to interpret and enforce the Stark Law. 

The significance of the release of the Phase III Stark Law regulations, however, is tempered by the inclusion of several proposed changes to the Stark Law by CMS in the 2008 proposed Medicare physician fee schedule. Physicians and other healthcare providers should nonetheless adopt the changes and new interpretations in the Phase III Stark Law regulations while continuing to monitor the changes to the Stark Law adopted in the “final” version of the 2008 Medicare Physician Fee Schedule.

by Lyn S. Savoie

Earlier this year, I wrote an article regarding the Office of Inspector General’s (“OIG”) December 2006 review of Louisiana’s Medical Assistance Programs Integrity Law (“MAPIL”). At that time, the OIG had determined that MAPIL did not meet the requirements outlined in Section 6031 of the Deficit Reduction Act of 2005 (“DRA”) and, therefore, Louisiana was not entitled to the financial incentives outlined in the DRA. In my January 2007 article, I mentioned that it was likely Louisiana would amend MAPIL to comply with the DRA requirements. It now appears that the legislature has attempted to do just that.

by Valerie A. Judice

On July 19, 2007, the Fifth Circuit Court of Appeals affirmed the ruling of the U.S. District Court for the Eastern District of Louisiana denying class certification to three plaintiffs seeking to represent a class of uninsured patients who had received treatment from Ochsner Clinic Foundation. Maldonado v. Ochsner Clinic Found., No. 06-30573 (5^th Cir. July 19, 2007).  The plaintiffs filed a lawsuit against Ochsner Clinic Foundation, a non-profit corporation, on behalf of themselves and all others similarly situated uninsured patients. The plaintiffs claimed that Ochsner billed uninsured patients higher rates for their care according to Ochsner’s internal “chargemaster” rates, while offering lower discounted rates to patients with private insurance, Medicare or Medicaid. 

by Linda G. Rodrigue

The medical necessity of durable medical equipment (“DME”) billed to the Medicare Program may have no relevance to a court’s determination of whether a DME supplier submitted claims based on fraudulent Certificates of Medical Necessity (“CMN”).   The Sixth Circuit Court of Appeal recently upheld a conviction of aiding and abetting Medicare fraud when a DME supplier submitted apparent fraudulent CMNs, even though the DME supplier might have been able to prove the medical necessity of the DME.

In United States v. Davis, Nos. 06-5073/5074, decided June 22, 2007, the Sixth Circuit affirmed a conviction on twelve (12) counts of aiding and abetting Medicare fraud. The convictions of an owner and an employee of the DME supplier stemmed from the supplier’s submitting claims to the Medicare Program for oxygen equipment that had been provided to miners with black lung disease. 

by Clay J. Countryman

On July 24^th, Representative Pete Stark (D- CA) introduced an amendment to The Children's Health and Medicare Protection Act of 2007 that would eliminate the whole hospital exception in the Federal physician self-referral law, otherwise known as the Stark Law.

Specifically, Section 651 of The Children’s Health and Medicare Protection Act of 2007 would eliminate the whole hospital exception in the Stark Law which would result in physicians being prohibited from referring Medicare patients to hospitals in which they have ownership interest. This amendment would apply to all hospitals, and not only physician-owned specialty hospitals. However, the amendment would grandfather hospitals that were in operation with Medicare provider agreements as of the date of introduction of the bill which is July 24, 2007.

by Linda G. Rodrigue

In June, 2007, the United State Court of Appeals for the District of Columbia Circuit affirmed the dismissal of a lawsuit brought by a physician association, alleging that the “fair market value safe harbor” under the federal Stark law developed by the Centers for Medicare and Medicaid Services (“CMS”) is invalid because it was implemented without following proper procedure. The court did not rule on the merits of the association’s claim. Instead, the court decided that the association did not have standing to bring the suit because even if the court were to declare the “safe harbor” invalid, the substance of the “safe harbor” would likely still be relied on to demonstrate that physicians who refer Medicare and Medicaid patients to “designated health services” (DHS) providers with whom they have a financial relationship are being paid fair market value by the DHS providers for any contracted services they perform.

by Clay J. Countryman

On July 2, 2007, the Centers for Medicare and Medicaid Services (CMS) posted on its website the proposed updates to the Medicare Physician Fee Schedule for 2008. These proposed changes included a number of significant revisions to the federal physician self-referral prohibition otherwise known as the Stark Law. This article includes a brief summary of some of the proposed changes to the Stark Law regulations. The Kean Miller healthcare regulatory group will issue an expanded summary of the changes to the Stark Law regulations included in the proposed changes for 2008. 

by Clay J. Countryman

The OIG issued an advisory opinion on June 12, 2007 regarding a hospital's proposed purchase of a partial ownership interest in a physician-owned Ambulatory Surgical Center (ASC). The message from this advisory opinion appears to be that the purchase of an interest in an existing physician-owned provider, such as an ASC, imaging center or Specialty Hospital, will receive a heightened level of scrutiny by the OIG.

by Linda G. Rodrigue

The Centers for Medicare and Medicaid Services (”CMS”) recently issued a letter to State Survey Directors, who conduct surveys to ensure that health care providers (such as hospitals) are meeting the Medicare conditions of participation, to advise them that a hospital may not condition its acceptance of an EMTALA transfer on the sending hospital’s using a particular transport service. In Letter No. S&C-07-20, dated April 27, 2007, CMS indicated that the Emergency Medical Treatment and Active Labor Act (“EMTALA”) Technical Advisory Group has received testimony that in some instances in which an EMTALA transfer was appropriate, the receiving hospital conditioned its acceptance of the patient on the sending hospital’s using a medical transport service owned by the receiving hospital. 

by Lyn S. Savoie

The Louisiana Medicaid program recently issued a notice for all providers stating that Louisiana Medicaid is in the process of developing a contingency plan for national provider identifier (“NPI”) implementation. The notice stated that the Department of Health and Hospitals (“DHH”) and Unisys will not be implementing the NPI only system changes on May 23, 2007. Providers submitting Louisiana Medicaid claims shall continue using their 7-digit provider numbers on all paper and electronic claims until DHH gives a future notice to use NPIs. Louisiana Medicaid providers must still register their individual NPIs with Louisiana Medicaid and continue their efforts towards the use of NPIs on all claims.

by Clay J. Countryman

The Centers for Medicare and Medicaid Services (CMS) on March 23, 2007 filed a continuation notice in the federal register, which officially delayed the deadline for publication of the Phase III final rule interpreting the federal physician self-referral prohibition commonly known as the Stark Law until March 26, 2008. For the healthcare industry, and specifically physicians, this means that it may be several months before CMS addresses certain provisions that were included in the “interim final rule with comment period” issued by CMS on March 26, 2004 (referred to as the “Phase II rule”). 

by Lyn S. Savoie

The Office of Inspector General (“OIG”) recently determined that Louisiana’s Medical Assistance Programs Integrity Law (“MAPIL”) does not meet certain requirements outlined in Section 6031 of the Deficit Reduction Act of 2005 (“DRA”). Section 6031 of the DRA provides a financial incentive to states who enact laws that establish liability to the state for individuals and entities that submit false or fraudulent claims to the state Medicaid program, if the state’s law satisfies certain requirements outlined in the DRA. If the Office of Inspector General (“OIG”) determines that a state false claims act meets the enumerated criteria under the DRA, then the state will receive a 10-percent increase in its share of Medicaid fraud recoveries from state actions brought under the state act. To date, the OIG has reviewed laws enacted in 10 states and determined that seven states’ laws, including MAPIL, do not comply with the DRA requirements.

by Valerie A. Judice

The Louisiana First Circuit Court of Appeal ruled on December 28, 2006 that a CRNA may not rely on a “statement” issued by the Louisiana Board of Nursing that a CRNA may perform pain management procedures even if under the direction and supervision of a physician. A CRNA had asked the Louisiana State Board of Nursing for its opinion on whether a CRNA could perform pain management procedures. The Louisiana State Board of Nursing issued a “statement” which provided that the CRNA could perform procedures such as peripheral nerve blocks, epidural injections and injection of local anesthestics, if under the direction and supervision of the physician.

by Linda G. Rodrigue

On November 3, 2006, the United States Court of Appeals for the Eleventh Circuit, in the case of Gulfcoast Medical Supply v. Secretary, Department of Health and Human Services, issued an opinion that a certificate of medical necessity (“CMN”) does not unequivocally establish that durable medical equipment (“DME”) meets the reimbursement test of “reasonable and necessary”, as required by Medicare Part B. In the first case of its kind in any federal court of appeals, the Eleventh Circuit held that the Secretary of the Department of Health and Human Services (“DHHS”) may require a DME supplier to submit additional evidence beyond the CMN in order to establish the medical necessity of the item for reimbursement.

by Randy R. Cangelosi

by Clay J. Countryman

The Department of Health and Human Services (“DHHS”) Office of Inspector General (“OIG”) and the Centers for Medicare and Medicaid Services (“CMS”) recently released on August 8, 2006 final rules establishing new safe harbors and exceptions for the donation of items and services for e-prescribing and electronic health records to physicians and other providers. These safe harbors and exceptions establish certain conditions under which: (1) health care providers furnishing services that are subject to the Stark Law (e.g., hospitals) may donate to physicians (and certain other recipients) certain qualifying electronic prescribing technology that are necessary and used solely for electronic prescribing; and (2) hospitals and other providers may provide physicians and other providers who furnish services to federal healthcare program recipients with interoperable electronic health records software or information technology and training services.

by Jason R. Cashio

In a three-two decision released today, the Third Circuit has ruled that the $500,000 cap on medical malpractice damages is unconstitutional as failing to provide an "adequate remedy" for plaintiffs as guaranteed under the provisions of La. Const. Art. 1, sec.22. 

The opinion was written by Judge Elizabeth A. Pickett, with Judges Billy Ezell concurring in a written opinion and Judge Genovese concurring in the result. 

Judge Sylvia Cooks wrote a dissenting opinion and Judge Oswald DeCuir concurred in the dissent of Judge Cooks. 

For a copy of the opinion, see the Third Circuit website:

            http://www.la3circuit.org/opinions/2006/09/092706/PR09-27-06.htm

            Arrington vs.  E.R. Physicians Group, A PMC et al   No. CA-04-01235

            And

            Taylor vs. Clement,  No.  CA-04-01069

by Linda G. Rodrigue

On August 1, 2006, the United States Court of Appeals for the Sixth Circuit affirmed a decision of the Departmental Appeals Board (“DAB”) of the United States Department of Health & Human Services (“DHHS”) that had upheld an award of civil monetary penalties of $77,100.00 against a skilled nursing facility (“SNF”) in Ohio. The penalties came as a result of the facility being cited by the state survey agency for numerous violations the agency was unwilling to waive, despite finding that prior Medicare program-participant violations had been substantially corrected upon revisit surveys. 

by Linda G. Rodrigue

On August 18, 2006, the Centers for Medicare & Medicaid Services (“CMS”) published a final rule that revises the hospital in-patient prospective payment systems (“PPS”) for fiscal year 2007. This article addresses the revisions CMS made to the requirements for Reporting Hospital Quality Data for Annual Payment Update (“RHQDAPU”) program in the PPS update. The revisions supplement the ten (10) quality measures CMS had established in November 1, 2003. These ten (10) quality measures involved Heart Attack, Heart Failure, and Pneumonia. For fiscal years 2005 and 2006, hospitals that chose not to submit quality data on the ten (10) quality measures received a 0.4 percentage reduction in payment update. For 2007 and subsequent years, the failure to report on the quality measures, which are being changed from 10 to 21 measures, will result in a 2.0 percent decrease. This large increase in reduction is mandated by the Deficit Reduction Act of 2005 (the “DRA”).

by Linda G. Rodrigue

On August 24, 2006, the Office of Inspector General (“OIG”) of the United States Department of Health and Human Services (“DHHS”), through its Office of Audit Services, issued a report finding that the Medicare Program overpaid an estimated twenty million dollars for non-physician radiology services provided to hospital inpatients. The estimated overpayments covered the period 2001-2003.

During a Medicare patient’s inpatient hospital stay, the Medicare Program, under Part A, pays the hospital under the Prospective Payment Systems (“PPS”) based on what is known as DRGs. DRG payments include payment for non-physician radiology services. These non-physician services are known as the “technical component” of radiology services. The physician component of radiology services, known as the “professional component”, is billed to the Medicare Program, Part B, by the physician.

by Linda G. Rodrigue

In an August 14, 2006 ruling on a motion in a federal case in Alabama, the district judge allowed the admission of an investigation report created by the Centers for Medicare and Medicaid Services (“CMS”) in an EMTALA action. The lawsuit was brought by a lady who, at 38 weeks of pregnancy, had been involved in an automobile accident. She presented to the hospital emergency department and advised the clerk she was pregnant and was having contractions. She was told that she must wait for the obstetrician on call to decide whether to see her. The patient left the hospital. She filed an EMTALA complaint. CMS investigated the matter and concluded that the hospital had violated federal regulations. The patient also sued the hospital in federal court.

by Linda G. Rodrigue

The Deficit Reduction Act of 2005 (the “DRA”) mandated that the Centers for Medicare and Medicaid Services (“CMS”) continue to study specialty hospitals and their effect on local community health care delivery. The study was due to be completed by August 8, 2006. However, ranking Senators have asked CMS to collect further data before completing its report. They have expressed concern that the study includes data for states in which specialty hospitals are not allowed to operate and has not included some traditional hospitals that compete directly with specialty hospitals. The DRA permits an extension of the August 8 deadline, however.

by Linda G. Rodrigue

Under the Deficit Reduction Act of 2005, acute care hospitals that report certain quality data can receive increased reimbursement rates for inpatient services. The Centers for Medicare and Medicaid Services (“CMS”) recently issued a final rule, on August 1, 2006, permitting acute care hospitals to receive, on average, a 3.5% increase in reimbursement rates for reporting quality data.

by Linda G. Rodrigue

The Medicare Modernization Act of 2003 (the “MMA”) requires the Centers for Medicare and Medicaid Services (“CMS”) to enter into contracts with “Part A/Part B Medicare Administrative Contractors” by the year 2011. The contracts with these entities will replace the existing contracts that CMS has with intermediaries for Medicare Part A claims and with carriers for Medicare Part B claims. The new contracts will be awarded to entities on a state-grouped, geographic basis. These entities will be expected to handle both Part A and Part B claims.

by Clay J. Countryman

On July 27, 2006, the U.S. House of Representatives passed by a vote of 270-148 H.R. 4157, which is intended to promote the use of health information technology (HIT) to improve the safety and quality of the nation’s health care system. This legislation has several significant aspects affecting the use of HIT, including codification of the Bush administration’s Office of the National Coordinator for Health Information Technology. According to the legislation, some of the National Coordinator for HIT’s ongoing responsibilities shall include maintaining and updating a strategic plan to guide the nationwide implementation of standards for HIT, serving as a principal advisor to the Department of Health and Human Services (DHHS) on the use of HIT, and coordinating HIT policies and programs across federal agencies.

by Linda Rodrigue

On April 24, 2006, the Inspector General of the U.S. Department of Health and Human Services (the "IG"), Daniel R. Levinson, issued an open letter to health care providers, focusing specifically on physicians and hospital providers. This letter focuses on potential violations of the Stark and anti-kickback statutes in the context of the hospital-physician relationship. The letter states that several hospital providers are discovering, through their compliance programs, improper financial arrangements under the Stark law, which is a strict liability statute. Stark prohibits the referral of Medicare or Medicaid patients to a hospital by any physician who has a "financial relationship" with the hospital. The financial relationship can take the form of either an ownership interest or a compensation arrangement. There are numerous exceptions to the Stark law's prohibition, but each element of an exception must be met to avoid the strict liability of the Stark law.

In a report issued by the Office of Inspector General ("OIG") of the United States Department of Health and Human Services ("DHHS") earlier this year, the OIG suggests that Medicare beneficiaries with certain diseases have experienced higher rates of hospital readmission and more hospital emergency department visits since the implementation of the prospective payment system ("PPS") as a method of reimbursing home health agencies.

The Office of Inspector General (OIG) concluded in Advisory Opinion No. 06-02 issued on March 21, 2006 that two programs proposed by a durable medical equipment (DME) manufacturer to physician practices would create a significant risk of fraud and abuse. The OIG also commented that it could impose administrative sanctions on the physician practices and DME manufacturer under the Federal anti-kickback law and other federal statutes and regulations if these proposed programs were utilized.

The Office of Inspector General ("OIG") of the United States Department of Health and Human Services ("DHHS") recently issued Advisory Opinion No. 06-01, which opined unfavorably regarding a home health agency's practice of providing prospective postoperative patients with preoperative home safety assessments.

The Louisiana Medicaid Program has notified health care providers that they may be able to receive reimbursement for medical treatment provided to uninsured evacuees of Hurricanes Katrina and Rita. To be reimbursed, the provider must have been enrolled in Medicaid as of August 24, 2005.

In 1999, the Institute of Medicine reported that an estimated 98,000 people die each year as a result of medical errors. On July 29, 2005, nearly six years after that notable report, President Bush signed into law the Patient Safety and Quality Improvement Act of 2005 (the "Act"). This new legislation seeks to reduce the number of future medical errors by creating a national medical error reporting system.

Some malpractice-reform advocates say an apology can help doctors avoid getting sued, especially when combined with an upfront settlement offer. It's all part of a new movement called "Sorry Works!" or "Say-You're-Sorry". In recent years, about fourteen states have passed laws allowing physicians and hospitals to apologize to patients for making mistakes without the fear of such apologies being used as admissions of guilt in subsequent litigation.

The Department of Health and Human Services, Office of Civil Rights ("OCR"), published two bulletins on September 2, 2005 and September 9, 2005 to discuss the application of HIPAA in the wake of Hurricane Katrina. The bulletins expressed the need for persons displaced by the hurricane to obtain ready access to health care and a means of contacting family and caregivers.

At a time when everyone in Louisiana appears to be focusing on the aftermath of Hurricanes Katrina and Rita, First Assistant United States Attorney for the Middle District of Louisiana Lyman Thornton assured Kean Miller's Lyn Savoie in a January 25th interview that his office is continuing to focus on health care fraud violations. During the interview with Thornton, he stated that health care fraud has been and will continue to be a priority of his office.

By: Lyn S. Savoie

The Centers for Medicare and Medicaid Services ("CMS") posted the final 2006 Physician Fee Schedule on November 1, 2005, thereby adopting the August 8, 2005 proposal to include diagnostic and therapeutic nuclear medicine services in two categories of designated health services that are subject to the federal physician self-referral statute (a.k.a., the "Stark Law"). This new change will prohibit physicians from referring patients to a facility where the physician (or an immediate family member) has a financial interest for listed nuclear medicine services, unless an exception applies. Of note, the final rule does not apply to the in-office exception that allows cardiologists to provide nuclear cardiac imaging in their offices.

In the wake of Hurricane Katrina, the Louisiana Department of Insurance has issued three (3) emergency rules to address issues resulting from the current State of Emergency. All rules retroactively become effective as of 12:01 a.m. on August 26, 2005, and shall continue in full force and effect for the duration of the present State of Emergency proclaimed by Governor Kathleen Blanco. Emergency Rule 15 relates to cancellation of insurance policies, notification requirements, and rate increases. Emergency Rule 16 applies to the settlement and business practices of insurance adjusters and requires all public adjusters operating in Louisiana to register with the Department of Insurance. The focus of Emergency Rule 17 is the continuation of health insurance coverage and the payment of claims to medical providers.

By Amy D. Berret

On September 2, 2005, Louisiana's Governor, Kathleen Babineaux Blanco, issued Executive Order No. KBB 2005-26. The order suspended all state licensure laws, rules and regulations for medical professionals and personnel from other states who offer medical services in Louisiana to those needing medical services as a result of Hurricane Katrina.

By the Kean Miller Health Law Team

The Department of Health and Human Services, Office of Civil Rights ("OCR"), published two bulletins on September 2, 2005 and September 9, 2005 to discuss the application of HIPAA in the wake of Hurricane Katrina. The bulletins expressed the need for persons displaced by the hurricane to obtain ready access to health care and a means of contacting family and caregivers.

By Clay Countryman

It finally happened. The Centers for Medicare and Medicaid Services ("CMS") released on August 8, 2005 as part of the changes to Medicare reimbursement for the 2006 Physician Fee Schedule a proposed change to federal regulations that would include diagnostic nuclear medicine services to the type of radiology services that are subject to the federal physician self-referral statute otherwise known as the Stark Law.

By Jennifer F. DeCuir

United States Senators Vitter, Salazar, Thune and Demint have proposed legislation to amend and expand the "Importation of Prescription Drugs" statute found at 21 U.S.C. §384. The Importation of Prescription Drugs statute, which became effective December 8, 2003, allows for the importation of prescription drugs from Canada to pharmacists or wholesalers in the United States.

By Linda G. Rodrigue

The proliferation of laws and regulations related to Medicare, Medicaid, and physician licensing make many physicians unsure about what business decisions they may make or arrangements they may enter without taking risks too large to justify the business advantages. With the advent of more aggressive regulation, physicians are also concerned about the difficulty involved in billing accurately. This post addresses some common physician questions.

By Clay J. Countryman

The regulatory debate over Specialty Hospitals continues as the moratorium on referrals of Medicare patients by physician-investors expired on June 8, 2005. The moratorium was an 18-month period in which Congress provided that physician ownership and investment in "specialty hospitals" would not qualify for the "whole hospital" and "rural provider" exceptions in the Stark Law.

By Clay J. Countryman

Health care providers welcomed the changes last year to the Medicare reassignment requirements that allow independent contractor physicians to reassign payment for Medicare-covered services regardless of the site of service to another entity such as a physician group. Prior to these changes, the Medicare reassignment regulations specifically required independent contractor physicians to provide services on a group's premises if the group wanted Medicare to pay the group directly for that physician's services.

By Lolly White

In-house counsel who are employed in Louisiana but are not licensed to practice law here have until July 1, 2005 to file an application for limited licensure to practice under the Louisiana Supreme Court's new In-House Counsel Rule.

In August of last year, a Colorado Federal District Court decided there is no private right of action under the privacy provisions of the Health Insurance Portability and Accountability Act of 1996 ("HIPAA"). Strangely, this case was not brought by an individual claiming the health care provider, a hospital, had violated the individual's HIPAA rights. Instead, the suit was brought by the hospital against a publishing company that owns a newspaper. The suit alleged that the newspaper had published the hospital's confidential peer-reviewed report that included negative information about a neurosurgeon on its staff. Go to entire article

By Clay J. Countryman

The Centers for Medicare and Medicaid Services (CMS) recently issued Phase II of the Final Regulations to implement and enforce the federal physician self-referral law (otherwise known as the "Stark Law"). The Stark Law generally affects all business relationships between physicians and other health care providers. Physician practices should review all aspects of their business operations to ensure that they will not be subject to fines or penalties under the Stark Law for making a referral prohibited by the Stark Law.

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