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Presenting a live 90-minute webinar with interactive Q&A CMS Voluntary Self-Referral Disclosure Protocol: Latest Developments Evaluating If, When and How to Report Potential Noncompliance With the Stark Law TUESDAY, JULY 17, 2012 1pm Eastern | 12pm Central | 11am Mountain | 10am Pacific Today’s faculty features: Jesse A. Witten, Partner, Drinker Biddle & Reath , Washington, D.C. Renee M. Howard, Partner, Perkins Coie , Seattle Thomas S. Schroeder, Partner, Faegre Baker Daniels , Minneapolis The audio portion of the conference may be accessed via the telephone or by using your computer's speakers. Please refer to the instructions emailed to registrants for additional information. If you have any questions, please contact Customer Service at 1-800-926-7926 ext. 10 .

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CMS Voluntary Self-Referral Disclosure Protocol: Latest Developments Evaluating If, When & How to Report Potential Noncompliance with the Stark Law July 17, 2012 Renee M. Howard 206.359.6751 RHoward@perkinscoie.com

Stark Law Prohibited Conduct  The Stark law prohibits a physician from making referrals for certain designated health services payable by Medicare to an entity with which a physician (or immediate family member) has a financial relationship, unless an exception applies.  Strict liability; intent to comply is irrelevant. 42 U.S.C. § 1395nn 6

Enforcement Risks  Payment denial  Mandatory refund  Civil Monetary Penalties  Up to $15,000 per service plus 3x reimbursement claimed/received  Up to $100,000 for circumvention schemes 7

Enforcement Risks, Cont.  False claims liability for failure to report and return overpayment  $5,500 - $11,000 per claim + treble damages  Criminal liability for concealing known overpayment  Felony charges and fine of up to $25,000, or imprisonment for up to five years or both 8

Enforcement Risks  Federal program exclusion  State law sanctions for prohibited Medicaid referrals  Reporting obligations under Corporate Integrity Agreement 9

So You Identified a Potential Stark Violation − Now What?  Is there really a Stark violation? If yes:  Take no action (not advised)  Repayment to Medicare contractor  U.S. Attorney's Office disclosure  CMS Self-Referral Disclosure Protocol (SRDP)  If other issues present (e.g., kickbacks), additional disclosures may be needed  OIG Self-Disclosure Protocol (no longer option for Stark-only) 10

CMS Voluntary SRDP  Intended to facilitate disclosure and resolution of actual or potential Stark violations  CMS has authority to decrease overpayment liability  Suspends 60-day report and return obligation  SRDP sets forth, among other things:  Detailed information to be disclosed  Procedural process for resolving matter with CMS  Factors considered in reducing amounts owed 11

CMS Report to Congress  9/10 – 6/4/12: 171 disclosures  3 referred to law enforcement  10 reported settlements as of July 5, 2012  Remaining disclosures:  Still under CMS review  Administrative holds  Additional information requested  Withdrawal by disclosing party 12

Saints Medical Center Settlement  1st SRDP settlement and largest to date  $579,000 payment; local media reported liability could be as high as $14.5M  PSA not satisfied for: (1) dep't chief and medical staff "leadership services" agreements and (2) hospital coverage agreements with physician groups 13

Remaining Nine Settlements  Settlement Range: $60 - $130,000  Nature of Stark Violation:  Failure to comply with PSA exception (3)  Exceeded calendar year non-monetary compensation limit for physicians (3)  Other (3)  Disclosing Entities: 7 hospitals (including one CAH) and 2 physician group practices 14

Who is Disclosing? 15

Settlement Agreements  Limited release from liability under CMS administrative authority for disclosed violation  SRDP settlement does not:  Constitute agreement on Medicare losses  Relieve criminal, civil or CMP liability  Defend against future administrative, civil or criminal action against disclosing party  Expect little negotiation on settlement amount 16

CMS Self-Referral Disclosure Protocol: Latest Developments July 17, 2012 Jesse A. Witten Drinker Biddle & Reath LLP Jesse.witten@dbr.com (202) 230-5146

Was There Really a Violation? > Holdover exception > Late signature provisions > Hospital-based providers – Definition of “referral” carveouts – See United States ex rel. Kosenske v. Carlisle HMA , 554 F.3d 88, 93 (3d Cir. 2009) > Does the “stand -in-the- shoes” provision apply? > Language requiring physicians to refer to hospital Self-Referral Disclosure Protocol: Latest Developments | July 17, 2012 18

Practical Tips > Certification requirement > When is a Stark Law overpayment “identified”? > Dealing with investigation creep > Mixed Anti-Kickback and Stark Law issues > Structuring the Disclosure Report Self-Referral Disclosure Protocol: Latest Developments | July 17, 2012 19

Practical Tips > Legal Analysis – How much to admit? – Element by element review of most relevant exception – FRE 408 > Statement of the Cause > Ability to Pay, Corrective Action, Compliance Program & Other Exculpatory Facts Self-Referral Disclosure Protocol: Latest Developments | July 17, 2012 20

Practical Tips > SRDP does not require that Medicaid data be provided – Stark Law does not bar referral of Medicaid patients or billing for those patients. See 63 Fed. Reg. 1659, 1704 (Jan. 9, 1998). – Physician may not make a referral for DSH to an entity for which payment may otherwise be made “under this subchapter.” 42 U.S.C. 1395nn(a)(1)(A). – State may not recover FFP if Stark Law violation. See 42 U.S.C. § 1396b(s). But, conduct may also have violated State version of Stark Law. – United States ex rel. Baklid-Kunz v. Halifax Hosp. Med. Ctr., 2012 WL 921147 (M.D. Fla. Mar. 19, 2012) Self-Referral Disclosure Protocol: Latest Developments | July 17, 2012 21

Practical Tips > Corporate Integrity Agreements – Requirement that overpayments be refunded can be satisfied via SRDP – SRDP requires that copy be sent to OIG monitor > Assume that information disclosed will eventually become public, but assert a FOIA exemption. > If prompt resolution is needed, such as to complete a transaction, notify CMS. Self-Referral Disclosure Protocol: Latest Developments | July 17, 2012 22

CMS Self-Referral Disclosure Protocol: Latest Developments ----------------------- Part III: Financial Analysis July 17, 2012 Tom Schroeder, Partner Faegre Baker Daniels LLP tom.schroeder@FaegreBD.com Direct: +1 612 766 7220

Elements of SRDP Financial Analysis ► The disclosing party must conduct a financial analysis setting forth: – Total amount owing based on “look back” period (IV.B.2.a) – Calculation methodology, including any estimation (IV.B.2.b) – Total amount of “remuneration a physician(s) received as a result of an actual or potential violation(s)” (IV.B.2.c) – Summary of any auditing done and documents relied upon (IV.B.2.d) 24

Practical tips in dealing with client ► Provide business office personnel clear parameters for calculation: – Specify Stark “entity” under analysis – Search by physician name/NPI – Start/end date of each look-back period – Use dates of service (as surrogate for “referral”), not dates paid – Define the approach to handling DRG, bundled payments – For non- hospital DHS, refer to CMS’ list of DHS by CPT/HCPCS codes • See 76 FR 73438 (Nov. 28, 2011) 25