Physicians Tripped Up By Change in Rule

April 15, 2013 – In The News
Medical Practice Compliance Alert

Michael Kline and Elizabeth Litten were quoted in the Medical Practice Compliance Alert article "Physicians Tripped Up By Change in Rule." While the full text can be found in the April 15, 2013, issue of Medical Practice Compliance Alert, a synopsis is noted below.

The mega-rule clarified that if you receive direct or indirect “remuneration” from or on behalf of a third party – such as a pharmaceutical manufacturer, physical therapist, durable medical equipment company or health club – that encourages the use of the third party’s product or services, the covered entity first will need authorization from the patient to make the communication. In addition, the authorization needs to alert the patient that the covered entity is receiving the payment or subsidy from a third party for the communication.

The marketing change is one of the biggest surprises in the final mega-rule. The proposed rule would have allowed treatment-related communications without needing an authorization or having to disclose the payment.

“It’s a big difference,” explains Elizabeth Litten. Since violation of HIPAA subjects you to potential civil and criminal penalties, compliance is a serious matter and a complaint about one violation could open the door to a full investigation.

More physicians are also being approached by third parties offering them subsidies to recommend products and services to patients.

“This will affect a lot of practices,” says Michael Kline.

Physicians may also run into trouble since some forms and types of communication don’t need authorization. Physicians who received remuneration to communicate about a product of service that did not need authorization under the old definition of marketing might violate the provision inadvertently.