Practice Management

There is an ortho group in our local market that has MR and CT and they are exploring becoming an IDTF.  Both modalities are located within their practice location and the ortho group is enrolled with Medicare.  My interpretation of the attached document is that they will have a problem being enrolling as and IDTF because the practice location is the same, assuming they would use that equipment on their own patients.  Am I understanding that correctly?

------------------------------
Tony Carozza
CAO
Radiology Associates, PA
Little Rock AR
(501) 537-3719
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Original Message------

There is an ortho group in our local market that has MR and CT and they are exploring becoming an IDTF.  Both modalities are located within their practice location and the ortho group is enrolled with Medicare.  My interpretation of the attached document is that they will have a problem being enrolling as and IDTF because the practice location is the same, assuming they would use that equipment on their own patients.  Am I understanding that correctly?

------------------------------
Tony Carozza
CAO
Radiology Associates, PA
Little Rock AR
(501) 537-3719
------------------------------

I think you hit the nail on the head, Keith.  The location issue is an obstacle, but even if you could figure out a way to carve things up so that you're not "sharing", Stark would probably still prohibit a Medicare referral from an owner to the IDTF unless there are very unusual circumstances allowing them to fall into a Stark exception other than in-office ancillary.

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David Smith FACMPE
Executive Director
United Imaging Consultants
Mission KS
(785) 393-8387
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Original Message:
Sent: 02-15-2019 11:06
From: Keith Chew
Subject: IDTF Question

Tony.  I would agree with your assessment. Hopefully others with greater insight will chime in as well. But I would think the self referral restriction would come into play. Even if they attempt to separate the locations and Tax IDs I would think the self referral rules would apply making it virtually impossible to do their own patients in the proposed IDTF..... Thoughts from others?

Sent from my Verizon, Samsung Galaxy smartphone

Original Message------

There is an ortho group in our local market that has MR and CT and they are exploring becoming an IDTF.  Both modalities are located within their practice location and the ortho group is enrolled with Medicare.  My interpretation of the attached document is that they will have a problem being enrolling as and IDTF because the practice location is the same, assuming they would use that equipment on their own patients.  Am I understanding that correctly?

------------------------------
Tony Carozza
CAO
Radiology Associates, PA
Little Rock AR
(501) 537-3719
------------------------------

Keith and David are correct in their statements, but keep in mind an "office" (like the one mentioned) entity can set up a separate entrance to the facility and enroll it as an IDTF serving non-Medicare and Medicaid patients - with some limitations as to the percentage of the total, in-office business and IDTF business, the IDTF can perform - with some additional detailed regulatory compliance hurdles to overcome with respect to a number of really important matters in order to make the proposed structure work - including compliance with Self Referral Prohibitions and other matters about which learned counsel can opine with specificity.  Bottom line: can they do it - yes - but will require some fancy footwork by attorneys expert in these matters.

I have seen such structures put in place - especially by Ortho Groups - some have made economic sense while others simply could not drive enough volume to reach profitability.

------------------------------
Douglas Smith FRBMA
President & CEO
Phase 4 Radiology Business Strategies, LLC
Canton GA
770-213-4605
------------------------------

Original Message:
Sent: 02-15-2019 11:15
From: David Smith
Subject: IDTF Question

I think you hit the nail on the head, Keith.  The location issue is an obstacle, but even if you could figure out a way to carve things up so that you're not "sharing", Stark would probably still prohibit a Medicare referral from an owner to the IDTF unless there are very unusual circumstances allowing them to fall into a Stark exception other than in-office ancillary.

------------------------------
David Smith FACMPE
Executive Director
United Imaging Consultants
Mission KS
(785) 393-8387

Original Message:
Sent: 02-15-2019 11:06
From: Keith Chew
Subject: IDTF Question

Tony.  I would agree with your assessment. Hopefully others with greater insight will chime in as well. But I would think the self referral restriction would come into play. Even if they attempt to separate the locations and Tax IDs I would think the self referral rules would apply making it virtually impossible to do their own patients in the proposed IDTF..... Thoughts from others?

Sent from my Verizon, Samsung Galaxy smartphone

Original Message------

There is an ortho group in our local market that has MR and CT and they are exploring becoming an IDTF.  Both modalities are located within their practice location and the ortho group is enrolled with Medicare.  My interpretation of the attached document is that they will have a problem being enrolling as and IDTF because the practice location is the same, assuming they would use that equipment on their own patients.  Am I understanding that correctly?

------------------------------
Tony Carozza
CAO
Radiology Associates, PA
Little Rock AR
(501) 537-3719
------------------------------

Original Message------

Keith and David are correct in their statements, but keep in mind an "office" (like the one mentioned) entity can set up a separate entrance to the facility and enroll it as an IDTF serving non-Medicare and Medicaid patients - with some limitations as to the percentage of the total, in-office business and IDTF business, the IDTF can perform - with some additional detailed regulatory compliance hurdles to overcome with respect to a number of really important matters in order to make the proposed structure work - including compliance with Self Referral Prohibitions and other matters about which learned counsel can opine with specificity.  Bottom line: can they do it - yes - but will require some fancy footwork by attorneys expert in these matters.

I have seen such structures put in place - especially by Ortho Groups - some have made economic sense while others simply could not drive enough volume to reach profitability.

------------------------------
Douglas Smith FRBMA
President & CEO
Phase 4 Radiology Business Strategies, LLC
Canton GA
770-213-4605
------------------------------

Keith,
At the risk of getting head of learned counsel, typically the IDTF is set up to take in patients NOT referred by the Group - in other words, patients not of the practice - the community at large whether Medicare, Medicaid or other insurances. In my experience Groups seek to do this in order to gain increased utilization of the equipment to offset the fixed costs of the in-office equipment.

I did not intend to insinuate that the Group would "cherry pick" who they send to which port of entry since the self referral rules would apply to the IDTF and since the IDTF would not be able to fall under the protection of the In-Office Ancillary Services Exception
The general principle is that the business of the IDTF is to take in patients not "of the practice".  By definition, the Group cannot refer patients to an entity in which they have an ownership.  Therefore, by definition, the Group is not falling into the trap of discrimination.

I may have inadvertently misstated the description in the scenario I described.  The bigger issue they face is how they construct the entity to  provide the IDTF with access to the medical imaging equipment and personnel housed in the Practice.  That takes a carefully constructed business arrangement.
Make sense?  Again, I defer to the lawyers expert in such transactions to weigh in on this matter.

I would suppose the original question posed is one seeking the possibility of stopping the Group from becoming even more of a competitor in their territory.  I would not bet on that horse.

------------------------------
Douglas Smith FRBMA
President & CEO
Phase 4 Radiology Business Strategies, LLC
Canton GA
770-213-4605
------------------------------

Original Message:
Sent: 02-15-2019 13:42
From: Keith Chew
Subject: IDTF Question

Doug – I do have a question based upon your response. If the ortho group refers their non-MCare and MCaid patients to the center and their MCare and MCaid patients elsewhere would that not violate the equal treatment doctrine – stating that they cannot treat MCare and MCaid patients any differently than they do the other patients of the practice?

 

Keith E. Chew, MHA, CMPE, FRBMA
C | 217-971-5293  

18 Hawks Nest | Chatham, Illinois     62629

 

Original Message------

Keith and David are correct in their statements, but keep in mind an "office" (like the one mentioned) entity can set up a separate entrance to the facility and enroll it as an IDTF serving non-Medicare and Medicaid patients - with some limitations as to the percentage of the total, in-office business and IDTF business, the IDTF can perform - with some additional detailed regulatory compliance hurdles to overcome with respect to a number of really important matters in order to make the proposed structure work - including compliance with Self Referral Prohibitions and other matters about which learned counsel can opine with specificity.  Bottom line: can they do it - yes - but will require some fancy footwork by attorneys expert in these matters.

I have seen such structures put in place - especially by Ortho Groups - some have made economic sense while others simply could not drive enough volume to reach profitability.

------------------------------
Douglas Smith FRBMA
President & CEO
Phase 4 Radiology Business Strategies, LLC
Canton GA
770-213-4605
------------------------------

Original Message------

Keith,
At the risk of getting head of learned counsel, typically the IDTF is set up to take in patients NOT referred by the Group - in other words, patients not of the practice - the community at large whether Medicare, Medicaid or other insurances. In my experience Groups seek to do this in order to gain increased utilization of the equipment to offset the fixed costs of the in-office equipment.

I did not intend to insinuate that the Group would "cherry pick" who they send to which port of entry since the self referral rules would apply to the IDTF and since the IDTF would not be able to fall under the protection of the In-Office Ancillary Services Exception
The general principle is that the business of the IDTF is to take in patients not "of the practice".  By definition, the Group cannot refer patients to an entity in which they have an ownership.  Therefore, by definition, the Group is not falling into the trap of discrimination.

I may have inadvertently misstated the description in the scenario I described.  The bigger issue they face is how they construct the entity to  provide the IDTF with access to the medical imaging equipment and personnel housed in the Practice.  That takes a carefully constructed business arrangement.
Make sense?  Again, I defer to the lawyers expert in such transactions to weigh in on this matter.

I would suppose the original question posed is one seeking the possibility of stopping the Group from becoming even more of a competitor in their territory.  I would not bet on that horse.

------------------------------
Douglas Smith FRBMA
President & CEO
Phase 4 Radiology Business Strategies, LLC
Canton GA
770-213-4605
------------------------------

Tony - The regulatory support for the information included in the Fact Sheet with respect to the prohibition on IDTF space-sharing is at 42 CFR § 410.33(g)(15):  

42 CFR § 410.33 -  Independent diagnostic testing facility.

• (g) Application certification standards. The IDTF must certify in its enrollment application that it meets the following standards and related requirements: 
  
  • (15) With the exception of hospital-based and mobile IDTFs, a fixed-base IDTF is prohibited from the following:
    • (i) Sharing a practice location with another Medicare-enrolled individual or organization;
    • (ii) Leasing or subleasing its operations or its practice location to another Medicare-enrolled individual or organization; or
    • (iii) Sharing diagnostic testing equipment used in the initial diagnostic test with another Medicare-enrolled individual or organization.

------------------------------
John Outlaw
Vice President, Compliance
Strategic Radiology
Florence SC
------------------------------

Original Message:
Sent: 02-15-2019 10:57
From: Tony Carozza
Subject: IDTF Question

There is an ortho group in our local market that has MR and CT and they are exploring becoming an IDTF.  Both modalities are located within their practice location and the ortho group is enrolled with Medicare.  My interpretation of the attached document is that they will have a problem being enrolling as and IDTF because the practice location is the same, assuming they would use that equipment on their own patients.  Am I understanding that correctly?

------------------------------
Tony Carozza
CAO
Radiology Associates, PA
Little Rock AR
(501) 537-3719
------------------------------