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URMC Compliance Program Policy Manual:
Payments, Discounts and Gifts
All of the URMC entities and most of their professional staff participate in the Medicare program, a federal program which provides health insurance to the aged and disabled, and the Medicaid program, a federal/state program which provides health care coverage to low income persons. Federal law makes it illegal for any person or entity to provide or accept "remuneration" (i.e. cash or anything else of value) in exchange for referrals of patients covered by Medicare, Medicaid or other Federal Health Care Programs (such as CHAMPUS, the Federal Employees Health Benefit Plan and the Railroad Retirement Board). The law also bars the payment or receipt of such remuneration in return for directly purchasing, leasing, ordering, or recommending the purchase, lease, or ordering of any goods, facilities, services, or items covered under the benefits of Medicare or Medicaid.
These so-called "fraud and abuse" or "anti-kickback" laws are designed to prevent fraud in health care programs and abuse of the public funds supporting the programs. URMC is committed to carefully observing the anti-kickback rules and avoiding any practice that may be interpreted as abusive. Employees in the finance departments, procurement services or purchasing, and facilities departments, laboratory, pharmacy, home health, medical staff administration, and any department entering into personal service contracts are expected to be vigilant in identifying potential anti-kickback violations and to bring them to the attention of their supervisor or the Compliance Officer.
The federal anti-kickback laws are broadly written to prohibit URMC personnel and representatives from knowingly and willfully offering, paying, asking for, or receiving any money or other benefit, directly or indirectly from third parties in connection with items or services billed to federal programs. The anti-kickback laws must be considered whenever something of value is given or received by a URMC entity or its representatives or affiliates, that is in any way connected to patient services. This is particularly true when the arrangement could result in over-utilization of services or a reduction in patient choice. Even if only one purpose of a payment scheme is to influence referrals, the payment may be unlawful.
There are many transactions that may violate the anti-kickback rules. For example, no one acting on behalf of a URMC entity may offer gifts, loans, rebates, services, or payment of any kind to a physician who refers patients to that entity, or to a patient, without consulting his or her supervisor, legal counsel or the Compliance Officer. Such persons should review any discounts offered by suppliers and vendors, as well as discounts offered to third party payers. Patient deductibles and copayments must generally be collected and may not be waived without the prior authorization of the Department Chair or other senior supervisors. Rentals of space and equipment must be at fair market value, without regard to the volume or value of referrals that may be received in connection with the space or equipment. Fair market value should be determined through an independent appraisal.
Agreements for professional services, management services, and consulting services must be in writing, have at least a one-year term, and specify the compensation in advance. Payment based on a percentage of revenue should be avoided in many circumstances. Any questions about these arrangements should be directed to legal counsel or the Compliance Officer. Joint ventures with physicians or other health care providers, or investment in other health care entities, must be reviewed by legal counsel.
The U.S. Department of Health and Human Services has described a number of payment practices that will not be subjected to criminal prosecution under the anti-kickback laws. These so-called "safe harbors" are intended to help providers protect against abusive payment practices while permitting legitimate ones. If an arrangement fits within a safe harbor it will not create a risk of criminal penalties and exclusion from the Medicare and Medicare programs. However, the failure to satisfy every element of a safe harbor does not in itself make an arrangement illegal. Analysis of a payment practice under the anti-kickback laws and the safe harbors is complex, and depends upon the specific facts and circumstances of each case. Employees within the System should not make their own judgments on the availability of a safe harbor for a payment practice, investment, discount, or other arrangement. These situations must be reviewed with legal counsel.
Violation of the anti-kickback laws is a felony, punishable by a $25,000 fine or imprisonment for up to five years, or both. Violation of the law could also mean that an entity (e.g. a facility) and/or a physician is excluded from participating in the Medicare and Medicaid programs for up to five years.
Entertainment and Gifts
It is recognized that business dealings may include a shared meal or other similar social occasion, which may be proper business expenses and activities. More extensive entertainment provided by vendors or service providers, however, only rarely will be consistent with URMC policy and should be reviewed and approved in advance by the Department Chair or other senior supervisor. System employees may not receive any gift under circumstances that could be construed as an improper attempt to influence the provider's decisions or actions. When an employee receives a gift that violates this policy, the gift should be returned to the donor and reported to the Compliance Officer. Gifts may be received when they are of such limited value that they could not reasonably be perceived by anyone as an attempt to affect the judgment of the recipient. For example, token promotional gratuities from suppliers, such as advertising novelties marked with the donor's name (e.g. coffee mug) are not prohibited under this policy.
Whenever an employee or a professional is not sure whether a gift is prohibited by this policy, the gift must be reported to the Compliance officer upon its receipt.