OIG Update: Can Your Hospital Pay For ER Coverage?

The OIG finally weighed in this month on a practice our hospitals engage in, but because of anti-kickback statutes, left them uneasy about violating federal law.  At issue is first, hospital inability to fill ER call positions and second, specialist per diem payment to plug the void:

“We are aware that hospitals increasingly are compensating physicians for on-call coverage for hospital emergency rooms. We are mindful that legitimate reasons exist for such arrangements in many circumstances, including scarcity of certain physicians within a hospital’s service area, and access to sufficient and proximate trauma services for local patients. Simply put, depending on market conditions, it may be difficult for hospitals to sustain necessary on-call physician services without providing compensation for on-call coverage.”

The stipend cannot disguise unlawful remuneration, but only pay for legitimate services to fill a medical need.  The OIG determined if the hospital in question hewed to criteria set forth in the document, they may proceed with contracts.  Legal muddles seem unlikely however, but caveats apply:

“Notwithstanding the legitimate reasons for such arrangements, on-call coverage compensation potentially creates considerable risk that physicians may demand such compensation as a condition of doing business at a hospital, even in cases where neither the services provided, nor any external market factor (e.g., a physician shortage) support such compensation. Similarly, payments by hospitals for on-call coverage could be misused to entice physicians to join or remain on the hospital’s staff or to generate additional business for the hospital.”

The short length of the opinion makes for easy reading; this has relevance if you plan to proceed with paid ER coverage however.  The advisory does not provide full protection, as it is only opinion, not law.  The source of the advisory makes them indistinguishable though.  The OIG usually has the last word.

Brad Flansbaum

Bradley Flansbaum, DO, MPH, MHM works for Geisinger Health System in Danville, PA in both the divisions of hospital medicine and population health. He began working as a hospitalist in 1996, at the inception of the hospital medicine movement. He is a founding member of the Society of Hospital Medicine and served as a board member and officer. He speaks nationally in promoting hospital medicine and has presented at many statewide meetings and conferences. He is also actively involved in house staff education.

Currently, he serves on the SHM Public Policy Committee and has an interest in payment policy, healthcare market competition, health disparities, cost-effectiveness analysis, and pain and palliative care. He is SHM’s delegate for the AMA House of Delegates.

Dr. Flansbaum received his undergraduate degree from Union College in Schenectady, NY and attended medical school at the New York College of Osteopathic Medicine. He completed his residency and chief residency in Internal Medicine at Long Island Jewish Medical Center in New York. He received his M.P.H. in Health Policy and Management at Columbia University.

He is a political junky, and loves to cook, stay fit, read non-fiction, listen to many genres of music, and is a resident of Danville, PA.

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  1. […] 29, 2012 by Brad Flansbaum Posted on The Hospitalist Leader on 11/29/2012 Bradley Flansbaum, Co-host of The Hospitalist […]

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