Eyeworld

March 2016 • Ophthalmology Business 17 consult an expert to ensure the legality of their particular arrangements. The underlying purpose of the Fraud and Abuse Law is to prevent financial incentives from overriding patients' best interests. Generally, the Stark Law is implicated if 1) referrals are made by an ophthalmologist or op- tometrist or his/her family member, 2) it involves a Medicare or Medicaid pa- tient, 3) it involves Designated Health Services (DHS) (e.g., A-scans and B-scans; post-cataract eyewear; outpa- tient prescription drugs; and inpatient and outpatient hospital services), and 4) a financial relationship exists among the parties. Stark is strict liability, so intentions are irrelevant. Because Cosmic is a co-owner, it has a direct financial interest in the practice to which it refers the "better" patients. If those referrals involve DHS provided to Medicare or Medicaid patients, the arrangement must meet an "exception" for it to be legal. At a minimum, Cosmic's optometrists must be more integrated in the practice than just co-owners and must actually pro- vide services to patients with a defined and appropriate compensation struc- ture, such that the combined entity meets the definition of Group Practice. While privately insured patients do not trigger Stark, many states have ana- logues to Stark that cover such claims. JB: Any other concerns? TA: These referrals also need to clear an Anti-Kickback Statute (AKS) (42 U.S.C.§1320a-7b(b)) analysis, which also may influence the Stark analysis because the relevant Stark exceptions require that financial arrangements not violate the Anti-Kickback Statute. They could give rise to claims under the Civ- il Monetary Penalties Law (42 U.S.C. § 1128A(a)(7)). The AKS prohibits di- rectly or indirectly offering or receiving anything of value in exchange for or to induce referrals. Even if legitimate reasons for remuneration exist, if one purpose is to induce referrals, the ar- rangement is illegal. Nevertheless, "safe harbors" protect certain practices, and even ar- rangements not meeting a safe harbor are not necessarily illegal. So again, the legal analysis is case by case, and the context and the details of the com- pensation arrangement matter. The government will generally be skeptical of any referral pattern differentiating between patients based on complexity, insurance (especially if the distinction is between federal and non-federal beneficiaries), or ability to pay. JB: Dr. Broocker worried about cherry picking as well and that there are not only state laws that disincentivize it, but physicians who cherry pick might be in violation of their contracts with payer sources. TA: That's a legitimate worry. Some payer contracts require providers to ac- cept all-comers and define under what circumstances they can decline pa- tients or terminate relationships. Some states also have enacted laws protect- ing patients' rights, which can limit a provider's ability to reject patients based on ability to pay. Ophthalmolo- gists should proceed cautiously before refusing care to patients based solely on ability to pay or which insurance they carry. JB: The bioethics part of me finds these arrangements troublesome because they are based on economic incentives rather than on optome- trists and their patients making fair- ness-based decisions on an ophthal- mology practice. For example, suppose the Cosmic co-owned ophthalmology practice is a considerable distance from where the patient lives but an- other, just as good one, is much closer. The patient then suffers the burden of the unnecessary travel costs. Also, an ethical axiom going back to Aristotle is that burdens should be distributed and shared equally among equals, but arrangements such as these violate that moral intuition. On the other hand, ours is a capitalistic, marketplace-driv- en economy so I'd bet many practices simply think, "If it's legal and it in- creases our revenues, why not? Every- body does it or would if they could." TA: Many providers who entered the profession because they wanted to help patients now feel they have no choice but to participate in practices like these to survive. To address these barriers to ethical practice, professional groups, lawmakers, and people with influence must take steps to address systemic dysfunctions that prevent or discour- age providers from meeting their ethi- cal obligations. OB Contact information Adyanthaya: tla@mmmlaw.com Broocker: ophtgb@emory.edu Dr. Banja is a professor and medical ethicist at the Center for Ethics, Emory University, Atlanta. He served on the ASCRS Governing Board and can be contacted at jbanja@emory.edu.

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