Recent Case Demonstrates Pitfalls of Getting Referrals from ALFs/ILFs

Elizabeth E. Hogue, Esq. (Republished with advance written permission)

Getting more referrals from assisted living facilities (ALFs) and independent living facilities (ILFs) seems to be a crucial piece of the puzzle for many types of post-acute providers; including home health agencies, hospices, private duty agencies, and HME companies. As the number of years in which they have been in business increases, ALF’s and retirement communities are more eager to assist their residents to “age in place.” This means that they often view availability of services from post-acute providers as essential to allow them to achieve this goal. 

While providers compete aggressively in the marketplace, they cannot lose sight of the fact that the healthcare industry is highly regulated. With ever-increasing emphasis on fraud and abuse compliance, providers cannot afford to violate the law. A recent case involving Watermark Retirement Communities illustrates this point.

Watermark, which manages seventy-nine retirement communities nationwide, has agreed to pay $4.25 million to resolve claims that it violated the False Claims Act by soliciting and receiving a kickback from a national home health company in order to facilitate referrals from Watermark facilities. Regulators alleged that the home health company purchased two of Watermark’s home health agencies in Arizona in order to induce referrals of Medicare beneficiaries living in Watermark residential communities. The arrangement included eight Watermark facilities in five states, including Arizona, Connecticut, Delaware, Florida, and Pennsylvania, where the two companies had overlapping operations. 

Enforcers alleged that Watermark caused the home health company to submit false claims for payments to the Medicare Program for services provided to Medicare beneficiaries referred as a result of the kickback transaction from January 1, 2014, through October 31, 2020. The home health company previously paid $17 million to resolve allegations of violations of the False Claims Act for paying a kickback to Watermark.

This suit was initiated by a former director of strategic growth for the home health company who filed a qui tam, or whistleblower, case under the False Claims Act. The former employee or relator will receive a total of $3,765,000 from the settlements with Watermark and the national home health company.

Part of the difficulty that post-acute providers may face in establishing relationship with ALFs and ILFs is that owners and managers of these types of facilities may be uneducated about fraud and abuse. They may have erroneously concluded that fraud and abuse prohibitions apply only to providers enrolled in the Medicare Program. They may not realize that the prohibitions apply to all state and federal health care programs; including Medicaid and Medicaid waiver programs, the VA, and TriCare; which may include payments for the types of services they provide.

Executives at ALFs/ILFs may also have lost sight of the fact that, as this case illustrates, both those who offer kickbacks and recipients of kickbacks may be held responsible. In a press release about this case on August 31, 2023, U.S. Attorney Philip Sellinger said, “Today’s resolution demonstrates that the Department is committed to holding accountable not only those who offer kickbacks but also those who receive them.”

Therefore, when post-acute providers establish relationships with ALFs and ILFs they must be prepared to provide more than a little education about fraud and abuse prohibitions in order to help ensure compliant arrangements. 

©2023 Elizabeth E. Hogue, Esq. All rights reserved.

No portion of this material may be reproduced in any form without the advance written permission of the author.

Moderna Says Updated COVID Vaccine is Effective Against Newer Variant

Reuters | By Patrick Wingrove

WASHINGTON — Moderna on Wednesday said clinical trial data showed its updated COVID-19 vaccine will likely be effective against the highly mutated BA.2.86 subvariant of the coronavirus that has raised fears of a resurgence of infections.

The company said its shot generated an 8.7-fold increase in neutralizing antibodies in humans against BA.2.86, which is being tracked by the World Health Organization and the U.S. Centers for Disease Control and Prevention.

"We think this is news people will want to hear as they prepare to go out and get their fall boosters," Moderna's head of infectious diseases Jacqueline Miller said, adding that the data should also help reassure regulators.

The CDC has previously indicated that BA.2.86 may be more capable of causing infection in people who previously had COVID or were vaccinated with previous shots. The Omicron offshoot carries more than 35 mutations in key portions of the virus compared with XBB.1.5, the dominant variant through most of 2023 and the target of the updated shots.

Moderna said it had shared the new finding on its vaccine with regulators and submitted it for peer-review publication. The retooled shot has yet to be approved by the U.S. Food and Drug Administration but is expected to be available later this month or in early October.

Read Full Article

Save Money by Outsourcing

With margins becoming even slimmer, more agencies are turning to outsourcing resources. Real Interact has been working with customers in healthcare across the country since 2014. They would love to help with everything your onsite team does, for just $15.99/hr. (e.g., patient calls, scheduling, pre-auth, etc.).

WHY OUTSOURCE TO REAL INTERACT?

1. No employee overhead (e.g., payroll taxes, benefits, unemployment insurance)
2. No headaches from managing and retaining resources.
3. Backup agents in place to avoid disruption of service
4. HIPAA compliant to protect patient information.
5. Full control of our team, just as if they were on-site

The following is a list of some of the services Real Interact can provide:

• Answering Inbound Calls with Dedicated Resources
• Scheduling / Rescheduling Appointments
• Referral Intake
• Reaching Out to Existing Patients for Follow Up Appointments
• Prescription Refills and Other Orders
• Insurance Verification, Prior Auth and Billing Issues
• Telemedicine
• Relaying Messages to Providers

See the “What they say about us” section on our homepage at www.realinteract.com or contact us through the website.

You can also email HHAC's contact, Adrian Kennedy, directly at [email protected]. 

Overtime Rule Changes

SESCO Management Consultants

The U.S. Department of Labor (DOL) has proposed that the White-Collar exemption salary threshold of $35,568 be increased to $55,068 per year. ***State law may require a salary threshold that exceeds the proposed federal salary threshold. ***

The DOL also is proposing automatic increases every three years to the overtime threshold.

To be exempt from overtime under the Fair Labor Standards Act’s "White Collar" Executive, Administrative and Professional exemptions, employees must be paid a salary of at least the threshold amount and meet certain duties tests. If they are paid less or do not meet the tests, they must be paid 1 1/2 times their regular hourly rate for hours worked in excess of 40 in a workweek.

The new rule is subject to a period of public comment and won’t take effect for several months.

As SESCO’s history is rooted in Wage and Hour compliance and representation of clients before the DOL, we recommend that the following steps be implemented now so as to prepare for these significant changes:

• Review your current salary-exempt positions and simply identify those who make less than $55,068 per year.

• Request/require these positions to begin to maintain an accurate record of time, if not already, to determine actual hours worked. Use a reason such as benefits, etc. – do not reference DOL.

• Determine whether currently classified salary-exempt employees who make less than $55,068 work in excess of 40 hours per week.

• If overtime is worked, determine if hours of work can be reduced to 40 or less so as to avoid an increase in the salary or transitioning the pay plan to a nonexempt plan with overtime.

• If, in fact, the position is required to work over 40 on a regular basis, then you will need to determine whether or not you wish to increase the salary in one fell swoop to the minimum requirement, $55,068.

• If this increase is not practical, you will need to determine whether or not you wish to implement a nonexempt pay plan which includes an hourly rate with time and one-half over 40 or SESCO’s recommended Fluctuating Workweek Method of Payment which is a guaranteed salary pay plan with half-time for hours worked in excess of 40 hours per week. The fluctuating workweek is a very viable pay plan for both employer and employee and will be the least disruptive to both parties. However, we strongly recommend that you contact SESCO before implementing such a program to not only ensure compliance with the DOL regulations, but also ensure that it is properly implemented and communicated to staff so that there is no confusion.

Contact your HR and employment law partner with any questions or concerns. For assistance, contact us at 423-764-4127 or by email at [email protected]