The Health Law Center 

Report From The Health Law Center

- Legal Insight You Can Use -

In This Issue: (Click on the section of interest or scroll down the page.)

- Introduction
- Article of the Month
- What's New on Our Website?
- What's New with the Health Law Center
- Legal Insight - Health Law Center's Tip Of The Month
- Conclusion


Welcome to our Report from the Health Law Center - Legal Insight You Can Use! The purposes of this Report are:

         to offer insight, guidance and mentoring about current news and developments in the health care industry, and

         to alert you to new developments with the Health Law Center and this website.

We hope you enjoy these Reports, and find them continually valuable.

These are the four linchpins of the Report from the Health Law Center - Legal Insight You Can Use. We want our Reports to help you:

         Identify and maximize growth opportunities;

         Resolve problems;

         Ensure regulatory compliance; and

         Get out - and stay out - of trouble.

These Reports contain some news and much opinion. Professionals at the Health Law Center have never shied away from "taking sides". Our clients value our ability to offer clear, practical insight. That expertise requires us to think about where things are heading, and what it will take for our clients to thrive in the days, months and years ahead.

Don't get us wrong - we certainly don't take this responsibility as a "chore." We enjoy helping you!

So, please forgive us if we get on our "soapbox" every so often. We intend to comment on wise and foolish behavior by the health care industry, the government, third party payers - and even health care advisors!

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Report from the Health Law Center Featured Article

Each Report we will select from the Health Law Center's extensive library of original materials an article which relates to current issues or events. This material will be uploaded onto the website for your reading pleasure. It will be available for download at no cost. Come back each month for a different article!

Our current Featured Article is "Legal Insight - What You Need To Know To Defend Yourself When The Government Comes Knocking!"  This article is a guide to defending your company when the government shows up for an investigation, or sends you a letter or subpoena requesting various documents. Our goal is to give you clear, practical insight about how to get out of trouble -- or stay out of trouble -- when the government comes knocking at your door (literally or figuratively).

Contact us if you would like to create a written policy for your health care organization about how to respond to government inquiries or investigations.

The Health Law Center can help you with all of your compliance needs. We can guide you in creating an effective compliance program, or help defend you against denials, fines, penalties and other problems from alleged violations of reimbursement and anti-fraud rules. Please go to the Contact the Health Law Center page to request details.

DID YOU KNOW? - The Health Law Center maintains an archive of all of its articles, addressing almost twenty years worth of information for the health care provider. To access our archives, click on Health Law Center Library. Then, go to the Contact the Health Law Center page with your requests. We will be happy to send you any article we have.

Come back soon for another all-new, fully downloadable installment of Legal Insight You Can Use!

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What's New on Our Website?

Blood, sweat and tears! Well, not really any blood. But we have put in a lot of sweat and a few tears to create a website you will find useful on an ongoing basis.

We intend for to be an information resource for health care providers and others seeking information about health law and the health care industry. For those of you searching for health lawyers to guide, mentor or defend your company as you pursue opportunities or wrestle with problems, will help you learn who we are, whom we serve, what we do, and our "personality."

ARE YOU LOOKING FOR INFORMATION ABOUT REGULATORY COMPLIANCE, REIMBURSEMENT ISSUES, JOINT VENTURES, CONTRACTING OPPORTUNITIES OR OTHER HEALTH LAW ISSUES? Check out the newest articles in our Publications archives. These latest items, as well as our articles from the past nineteen years, are available upon request. Click on Health Law Center Library to check them out.

INTERESTED IN OUTLINES FROM SPEECH PRESENTATIONS? Check our most recent speech outlines in our Presentations archives. We have offered seminar audiences insight and guidance on many, many health law topics, and we will be happy to send you materials upon request. Pick out material of interest from the archives and then go the Contact the Health Law Center page to fill out your request.

LOOKING FOR VALUABLE WEBSITES FOR HEALTH CARE PROVIDERS? Check out our Links page for the latest hyperlinks to other sites. If you find a place you like, let them know we sent you!

If you would like to set a reciprocal link with your website, contact us with your information.

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What's New with the Health Law Center

We have a lot to report this month!

         IN MAY, NEIL CAESAR WILL ATTEND MEDTRADE SPRING 2003.  Neil has been invited as a speaker at Medtrade Spring  since 1995. This year he offers the following program:

o        Legal Insight -- What to do When the Government Comes Calling

If you are interested in further information about this program, or would like a copy of the handout, please complete the Contact the Health Law Center page and let us know!

If you are a home medical equipment supplier, distributor or manufacturer, or a rehab, oxygen or infusion therapy supplier who plans to attend Medtrade Spring or Medtrade 2003, please let us know. We would love to meet you.

         HEALTH LAW CENTER PERSONNEL HAVE BEEN INTERVIEWED IN RECENT WEEKS by reporters from Eli's Physician Practice Compliance Alert, HomeCare, Laboratory Compliance Insider, Medicare Compliance Alert, OSHA Compliance Insider, and Rehab Report. When these articles appear, they will be added to our archives and available for your research use. Please go to the Health Law Center Library page for additional information.

         WE NOW HAVE FIVE DIFFERENT  BOOKS ON HEALTH CARE REGULATORY COMPLIANCE FOR MEDICAL GROUPS, CLINICAL LABORATORIES, HOME CARE PROVIDERS, AND REHAB COMPANIES AND MEDICARE PROVIDERS GENERALLY. Each of these books will help you create and run an effective internal legal compliance program for your organization. Each book will offer suggestions for cost effectively operating your compliance program, and will answer a number of substantive questions specific to the needs of physicians, home care providers, rehab companies or clinical laboratories.

These books are available directly from us or from the publisher, Eli Research. Discounts will be available.


o        Helped a home medical equipment supplier assess whether prior activities with a company now embroiled in a civil fraud investigation put this supplier at risk, and crafted a strategy for the supplier in the event of government scrutiny.

o        Negotiated with the compliance officer of a national health care provider to cease certain practices by the company's personnel which were unfairly impairing the competitive opportunities pursued by our client, a competitor of the national company.

o        Successfully applied innovative Internet research and communication methods to persuade a hospital to enter into a dialogue with our client, a medical group, to resolve an ongoing dispute.

o        Commenced complex negotiations with a hospital for a comprehensive long-term exclusive arrangement with our client, a large medical group.

o        Helped several medical group clients restructure their internal rules concerning ownership, succession planning, governance and company expansion, in order to position the health care companies for upcoming opportunities and future growth.

o        Evaluated a proposed income division plan for a large Midwest medical group, offering suggestions to ensure compliance with state and federal laws, and to help smooth the path for acceptance for the new system by the client's physicians.

o        Created a new master billing contract for use by a medical billing company.

o        Presided as arbitrator to resolve a dispute between a large specialty medical group and a former member.

         WANT MORE INFORMATION? Please go to the Contact the Health Law Center page with your requests.

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Legal Insight:
Health Law Center's Tip of the Month

A JUNE 30, 2000 DECISION BY THE WASHINGTON, DC CIRCUIT FEDERAL COURT OF APPEALS MAY CURB SOME OF THE GOVERNMENT'S OVERLY AGGRESSIVE PURSUIT OF ALLEGED VIOLATIONS OF THE FEDERAL FALSE CLAIMS ACT. More important, however, the Court of Appeals decision offers a hidden warning for those health care providers which are subject to the Stark laws.

Here are the basic facts. A growing number of cases brought by whistleblowers under the False Claims Act involved claims that are not "false" in the traditional sense. These lawsuits allege that claims submitted to the government become "false claims" when kickbacks or violations of the Stark law are involved.

The reason for this extrapolation is because most claims submitted to Medicare, Medicaid and other third-party payors are submitted on forms (like the 1500 Form) which contain preprinted language. Per this language, the provider "certifies" that (among other things) the provider has complied with all federal reimbursement rules. Therefore, the argument goes, when the provider in fact violates federal reimbursement rules by engaging in activity prohibited by the self-referral laws (the Stark law, the anti-kickback laws, etc.), a false claim has been filed and the False Claims Act is implicated.

Remember, too, that it is important for whistleblowers to implicate the False Claims Act because that is the only law which permits a private cause of action by whistleblowers. (These are the so-called qui tam provisions.)

Last June the DC Circuit Court of Appeals held that this theory had many holes in it, and that most attempts by whistleblowers in order to use the certification provisions in reimbursement paperwork to "bootstrap" other federal laws onto the False Claims Act would not succeed. The case (United States ex rel. Siewick v. Jamieson Science and Engineering, Inc., No. 99-7090, 2000 U.S. App. LEXIS 15370, 200 WL 772965 (D.C. Cir. June 30, 2000)) holds that False Claim Act lawsuits cannot be based on contingent adverse actions by the government that may or may not occur.

WHAT DOES THIS MEAN? Well, in most of the anti-kickback and Stark law cases, the issues are very fact-specific, typically looking to the parties' motives as part of the decision. Thus, the government is always faced with the question of whether to seek repayment (or nonpayment) of claims which otherwise are valid, because of the anti-kickback or Stark context. In other words, the government would have to exercise its assumed right to disclaim the reimbursement entitlement, in order to turn an otherwise valid claim into an allegedly "false" claim. According to the Court in Siewick, a whisleblower cannot condition a false claim act on a contingent event which might be exercised by the government. See Siewick, 2000 U.S. App. LEXIS 15370, at 15-16.

But there is a flip side to the court's decision as well - and here lies danger for those parties subject to the Stark law's self-referral prohibitions. In Siewick, the Court rejected the whistleblower's theory that false claims arose when submitted on forms which contained the certification that the provider had complied with all federal rules, holding that "a false certification of compliance with a statute or regulations cannot serve as a basis for a qui tam action under the FCA unless payment is conditioned on that certification." See Siewick, 2000 U.S. App. LEXIS 15370, at 6.

This is all very well and good for many whistleblower cases which attempt to "bootstrap" other laws onto the False Claims Act. However, part of the express statutory requirements of the Stark law (42 USC Sec. 1395nn; 42 CFR Part 411) is that providers must affirmatively certify that they have complied with the Stark law's provisions. In other words, the government (or whistleblowers) can argue that the Stark law requires a certification of compliance as an express precondition to payment of those claims which are subject to Stark.

Because of this, Siewick raises the strong possibility that a provider which follows the Stark law's certification requirement but nonetheless violates the law in some way has thereby submitted false claims under the False Claims Act. Whistleblower suits are still possible under this analysis.

Two words of caution here. First, this discussion is not intended to be an exhaustive legal analysis of this case. If you think this case may apply to a situation you have, please contact us for more informed discussion. (More important, the discussion would be privileged under attorney-client privilege.)

Second, remember that this decision only applies to the D.C. Circuit Court of Appeals. (However, the "implied certification" theory used by the Siewick court has also been adopted by the 4th Circuit, the 5th Circuit, and the 9th Circuit. See Harrison v. Westinghouse Savannah River Co., 176 F.3d 776, 793 (4th Cir. 1999); United States ex rel. Thompson v. Columbia/HCA Healthcare Corp., 125 F.3d 899, 902 (5th Cir. 1997); United States ex. rel. Hopper v. Anton, 91 F.3d 1261, 1266 (9th Cir. 1996).

To our knowledge, this application of the Stark law, and its lurking danger for whistleblower litigation, has never been discussed or explored in print. We will be pursuing this concept further over the next year, and will let you know of any new developments. Please don't hesitate to share with us your thoughts and comments!

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That's it for the current edition of Report From The Health Law Center - Legal Insight You Can Use! We welcome your feedback. Also, don't hesitate to call on us if we can serve as a legal or informational resource for you. Just complete the necessary information on the Contact the Health Law Center Page and we will get right back to you.

We look forward to seeing you next time!

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