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Question-Comment on OBS reimbursement, Insurance denial plan/Follow up on Internist hiring Dentist legal?

August 30, 2012

Question-Comment on OBS reimbursement, Insurance denial plan


I am an owner of an Office Based Surgery facility and I am finally getting reimbursed for facility fees.  I've heard that insurance companies, if required to reimburse for OBS fees, are planning to up denials on professional fees to make up for amounts paid for facility fees.  Any truth to this? Thoughts?  Recommendations?
Dr. K


Dr. K, first, glad to hear you are being reimbursed for facility fees (for those unfamiliar with the concept - a facility fee is a site of service fee paid separate and apart from professional fees).  Second, this is the first I am hearing of the "insurance facility fee plot", which name I have just coined, however, I do not doubt the tactic will be employed.  It should come as no surprise at this point to any provider that insurance companies are using any and all tactics to deny reimbursement for just about everything.  So, if facility fees become required, which I hope is the case as there is no reason for a medical practice complying with State ordained accreditation requirements, paying a considerable amount of money for obtaining and maintaining such accreditation if their practice is not to be reimbursed in addition to the profession fee component, I do not see why the above statement would not be a potentially likely outcome.  The facility fee element of the fee will likely be harder to deny.  If a required payment - payment for a facility fee will be required when any procedure is performed at the site, regardless of complexity, etc.  There will likely remain greater variables in the professional component, hence more leeway for an insurance company to substitite its judgment for yours and deny reimbursement for providing "non-medically necessary" care.  The best advice I can give at this time is for you to join, if you have not already, NYOBS - The Society of New York Office Based Surgery Facilities, to stay up to date on OBS news and to join your colleagues in advocating for proper reimbursement of facility fees and protection of OBS providers.  Another recommendation, challenge each denial rendered by an insurance company.  Report to the Department of Financial Services for improper denials.  Call your healthcare attorney regarding strategy and representation if you see a pattern and require assistance.  Do not accept inappropriate denials.  Also, our firm will be monitoring this situation.  If you hear something in addition or need help, please let me know. 

Follow up on Internist hiring Dentist legal?


Thank you very much.  Would it be legal for a dermatology practice to employ a plastic surgeon since a dermatologist cannot "supervise" all aspects of a plastic surgeon's work? As you are likely aware, there are a number of dermatology groups in the NYC area which employ a plastic surgeon.  At your convenience, please advise.  Thank you in advance for your assistance.
Best Regards,
Dr. A

I see less of a concern with MD-MD employment relationships.  There is tons of precedent for multi-practice groups and nothing out there that I am aware of limiting derm, plastic relationships.  We are seeing certain arrangements questioned, i.e., the Office of Inspector General just opined on gastro- anesthesia relationships that will put a minor crimp in arrangements typically made between the specialties.  Regardless, in any contract (which is required with any employee), I recommend ensuring that the supervision element of plastics being performed in clearly included under the Plastic Surgeon's duties.  I recommend having such language reviewed, as well as any potential practice structure you are entering into.  Better safe than sorry....


A follow-up to Tuesday's email, I am an internist and I want to employ a podiatrist, derm and obgyn. I cannot supervise these professions.  Would this clause "supervise" also affect hiring or having a medical service agreement?
Dr. G


For the MD-MD relationships, I defer to the above answer.  I see a potential issue with the podiatry arrangement.  However, again there are no specific prohibitions I am aware of against hiring, just the potential licensure issue regarding supervision.  As explained Tuesday, I recommend setting forth by contract who is responsible for what, and also reviewing any such arrangements with counsel to ensure they are structured appropriately.  Also, with regards to the "medical service agreement" question, as far as I am concerned that is an employment arrangement.  You may want to look into a rental or license arrangement where these other professionals are renting or licensing space, personnel and/or equipment from you and paying a flat fee instead of employing.  This may result in substantially less liability to your practice.  Any such arrangement would have to be structured properly and reviewed for appropriateness.  You may also require a regulatory review to ensure no violation of the Anti-kickback and referral laws. 

Hope this helps.

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