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CMS ISSUES ADVISORY OPINION CONCERNING OWNERSHIP OF MULTI-SPECIALTY GROUP PRACTICES.

The Centers for Medicare and Medicaid Services ("CMS") issued an advisory opinion in which it concluded that stock held by physician-shareholders in a charitable, IRS 501(c)(3) multi-specialty group medical practice did not constitute an ownership or investment interest for purposes of a Stark Law analysis. With certain limited exceptions, the Stark Law prohibits a physician from referring Medicare or Medicaid patients to any entity with which that physician has a financial relationship. By this most recent opinion, CMS concluded that the stock held by the physician did not constitute an ownership or investment interest and, therefore, did not create the type of financial relationship the Stark Law was designed to discourage. By that opinion, CMS noted that the stock held by the physicians exhibited none of the benefits typical of ownership. Indeed, even though the physician purchased "shares" of stock, the stock remained unaffected by the financial performance of the practice and its value never changed. Furthermore, shareholders did not receive dividends and, upon leaving the group, all shares were redeemed for the original purchase price of one thousand dollars. Accordingly, CMS found that this form of ownership did not produce the type of compromising financial relationship that Stark was enacted to prohibit. If you have any questions concerning this most recent opinion or any other issues related to your business relationships and/or structures, feel free to contact Mathew Levy, Esq. at (516) 326-1880 for further advice or guidance.

LOUISIANA RELAXES LICENSURE RULES TO HELP PROVIDE KATRINA RELIEF.

Louisiana Governor Katherine Blanco recently suspended all restrictions that would otherwise prohibit physicians from other states from practicing in Louisiana without following strict licensing procedures. The executive order issued by the Governor now permits physicians licensed in any other state to volunteer their professional services to those in need following the devastation of Hurricane Katrina. Accordingly, physicians licensed in any one of the fifty (50) states may offer their professional services in Louisiana until such time as the executive order is rescinded. For further information concerning Katrina Relief efforts, contact your county medical society or the Medical Society of the State of New York.

CMS ISSUES INTERIM FINAL RULE ON POWER WHEELCHAIRS AND MOTOR SCOOTERS

Late last month, The Center for Medicare and Medicaid Services ("CMS") issued an interim final rule that will purportedly simplify and streamline rules pertaining to the supplying and receiving of payments for power wheelchairs and motor scooters. Previously, CMS required the submission of a Certificate of Medical Necessity ("CMN") signed by the prescribing physician before payment could be authorized. The new interim rule dispenses with the need for a CMN, but investigations into the propriety of such prescriptions have been a high priority for the federal government and will inevitably continue. If you receive an inquiry from the Office of the Inspector General for the Department of Health and Human Services or any other law enforcement agency concerning an investigation into the prescription and/or ordering of durable medical equipment, feel to contact Kern Augustine for guidance.

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