Med Law Blog

 Contributed by Paul Welk

pwelk@tuckerlaw.com, 412.594.5536

Orthopedic Institute of Pennsylvania ("OIP") and the Department of Health and Human Services Office for Civil Rights recently settled a Complaint filed by a prospective patient who is deaf. The Complaint was filed after OIP declined the patient's request for a sign language interpreter when he called to schedule an appointment to discuss a surgical procedure. The Office of Civil Rights said that OIP's blanket policy of not providing sign language interpreters denied patients who required an interpreter an equal opportunity to have access to OIP's programs and services, in violation of Section 504 of the Rehabilitation Act of 1973 and its implementing regulations. The Settlement Agreement requires OIP to adopt policies and procedures approved by the Office of Civil Rights for insuring effective communications with patients who have impaired hearing, train staff to implement such policies, and submit reports to the Office of Civil Rights documenting its compliance with each provision of the settlement. 

| Posted By Michael Cassidy In Legal News | 0 Comments | Permalink

On March 10, 2010, the U.S. Senate passed legislation (H.R.4213) on a 62-36 vote, which would reportedly delay a scheduled 21.2 percent Medicare payment reduction for physician services until October 1, 2010

| Posted By Michael Cassidy In Medicare & Reimbursement | 0 Comments | Permalink

The American Medical Association has created a resource for physicians to understand the HIPAA Privacy and Security Rules and their changes as a result of the 2009 economic stimulus package. 

This resource outlines new requirements:

1. Protection of patient information;
2. How to comply with patients' requests to access their information; and
3. Administrative protections physicians must have in place.

It also provides the compliance schedule and all relevant compliance deadlines.

The web address is as follows: www.ama-assn.org/ama1/pub/upload/mm/368/hipaa-guidance.pdf.

| Posted By Michael Cassidy In HIPAA and HIT | 1 Comments | Permalink

Maria Danaher and Ogletree Deakins have posted an article on a medical staff  discrimination case that focuses on the contractual requiremants and the medical staff bylaws issue at http://www.employmentlawmatters.net/. Not only does it raise the issue of the 1981 requriements, but also how Georgia views medical staff bylaws.

| Posted By Michael Cassidy In Credentialing and Peer Review | 0 Comments | Permalink

 President Obama has signed H.R. 4691, "The Temporary Extension Act of 2010", into law. H.R. 4691 re-instates the therapy cap exceptions process until March 31, 2010. Outpatient therapy service providers may now submit claims with the KX modifier, when an exception is appropriate, for services furnished on or after January 1, 2010 through March 31, 2010. To view full text of the bill, click here.

| Posted By Michael Cassidy In Legal News | 0 Comments | Permalink

Special Medicare payment update: President signs extension of physician payment freeze

Late last night, the president signed H.R. 4691, the Temporary Extension Act of 2010 into law. This legislation includes a provision that freezes Medicare physician payments at their current level until March 31, 2010. The legislation also extends the therapy cap exception process through until March 31, 2010.  The bill passed the Senate by a vote of 78 – 19.  The House of Representatives had unanimously approved a companion bill by voice vote on Feb. 25. 

The Senate is also currently debating H.R. 4213 the American Workers, State, and Business Relief Act of 2010. This legislation extends the freeze on Medicare physician payments until Sept. 30, 2010. It also provides an extension to the therapy cap exception process through Dec. 31 , 2010 and an extension of the geographic practice cost index floor through Dec. 31, 2010.  If approved by the Senate, the bill would have to be approved by the House before transmittal to the president. 

MGMA does not support these continued short-term congressional interventions and urges members to contact their senators and representatives to support permanent repeal of the sustainable growth rate formula.

| Posted By Michael Cassidy In Medicare & Reimbursement | 0 Comments | Permalink

In Patterson v. Methodist Health Care-Memphis Hospitals, the Tennessee Court of Appeals affirmed an order of summary judgment, allowing a Tennessee hospital to terminate the medical staff membership and clinical privileges of two physicians for a breach of contract. The contract was established by the medical staff bylaws, which required a certain level of continuous uninterrupted professional liability insurance coverage. Upon termination of the membership and privileges, the physicians sued challenging the breach of contract and asserting tortious interference with contractual relationships. 

The court concluded that the bylaws constituted a contract, that there was substantial undisputed evidence to establish that the doctors consented to the terms of the contract by applying for medical staff membership, that they violated the terms of the contract and were not excused from performing the contract.

With respect to intentional interference with contractual relationships, the court concluded that the hospital was entitled to exercise its own business judgment by terminating physicians who do not satisfy the professional liability insurance coverage requirements, and that decisions made for valid business objectives do not satisfy the improper motive requirements for proving the tort of intentional interference. The court stated “we conclude that Methodist acted pursuant to a valid business objective when it enacted and enforced revised bylaws requiring members of its staff to maintain a minimum level of insurance coverage.”

| Posted By Michael Cassidy In Credentialing and Peer Review | 0 Comments | Permalink

There have been many articles written about the negotiation and enforceability of physician restrictive covenants, but there are just a few fundamental concepts crucial to understanding and successfully navigating these issues.

1.         The Myth of Unenforceability. Many physicians either completely ignore or dismiss the significance of restrictive covenants because of the mistaken belief that restrictive covenants are unenforceable. Except in those states which statutorily ban restrictive covenants, such as California and Kentucky, this is simply not true.

2.         Suspect Enforceability. It is true the courts in many states look with disfavor upon restrictive covenants; courts often search for exceptions and methods to invalidate restrictive covenants, because of the significant impact upon the individuals involved. However, this attitude does not make restrictive covenants unenforceable. It simply means that courts respond favorably to the arguments of making sure that the restrictive covenants are reasonable both in time and scope. However, that is certainly no reason for any individual to believe that a court will find a way to minimize the potential harm or impact of a restrictive covenant. 

3.         Injunctions and Liquidated Damages. Restrictive covenants are often enforced through injunctions, which are court orders specifically prohibiting a physician from violating the terms of a restrictive covenant, i.e. preventing practice within the time and area described by the contract. Injunctions in these matters are issued routinely. Some contracts include liquidated damages provisions, which gives the practice the option of seeking money damages instead of an injunction. If the liquidated damages are fairly low, that might actually be a benefit to the physician, who can argue that the parties have already agreed upon the damages so that an injunction is not necessary. Although the presence of a liquidated damages clause in a restrictive covenant might benefit the physician, it would be a gamble to rely upon that argument.

4.         Unenforceability and Breach. The restrictive covenant is part of a contract between the practice and the physician. If the practice breaches its agreement, it is logical and reasonable for the physician to believe that he would not be bound by a contract and a restrictive covenant that have been breached by the practice. That is a legitimate and a reasonable outcome, but it necessarily depends on proving the antecedent breach.

5.         Negotiation of Options. The harm and impact of the restrictive covenant is twofold, not only does it prohibit certain practice activities, but it provides the practice overwhelming leverage in future negotiations. Your initial negotiation strategy should always include an attempt to limit the scope of the restrictive covenant so that the physician will later have some reasonable practice alternatives that limit the leverage in this situation. 

| Posted By Michael Cassidy In Restrictive Covenants | 1 Comments | Permalink