Hospital Permitted to Share Pay-for-Performance Bonuses with Physician-Owned Practice

The Department of Health and Human Services Office of Inspector General (OIG) has given the green light to a hospital’s proposed arrangement to change its pay-for-performance program to allow for sharing with a physician-owned entity a percentage of the bonus compensation it receives from a private insurer for meeting certain quality targets.

According to OIG, the proposed arrangement could constitute an improper payment to a physician to induce reduction or limitation of services to Medicare or Medicaid beneficiaries under the physician’s direct care, thereby triggering the civil monetary penalty (CMP) provision set forth in the Social Security Act. In addition, OIG said that the proposed arrangement could potentially generate prohibited remuneration under the anti-kickback statute, which prohibits payments to physicians for referring federal healthcare program business to a facility.

OIG concluded, however, that it would not impose sanctions because the arrangement as structured posed a low risk of fraud and abuse. The requesting hospital participates in a pay-for-performance program implemented by a private insurer, under which the user pays the requester for the care of patients in a given year as well as an additional percentage of the base compensation based on the extent to which the requester meets certain standards of quality and efficiency established by the insurer.

Under the proposed arrangement, the requestor would enter into an agreement with a physician-owned entity whose members are on the requestor’s medical staff, according to the opinion. Pursuant to that agreement the physician entity would require its members to undertake various tasks to ensure that the quality targets are achieved, including developing policies and procedures, conducting peer review and auditing medical records.

The requestor would then pay the physician entity a percentage, not to exceed 50%, of the incentive payments it receives from the private insurer for achieving the insurer’s quality targets. The physician entity would then distribute its earnings under the agreement to its members on a per capita basis.

At the outset of its analysis, OIG reiterated its long-standing concerns about gainsharing program or similar cost-savings arrangements such as the requestor’s pay-for-performance proposal. Nonetheless, OIG concluded that, although the incentive payments at issue implicated the CMP, several features of the proposed arrangement provide sufficient safeguards against patient and federal healthcare program abuse.

In addition, the requestor certified that it would monitor the quality targets throughout the term of the agreement to protect against inappropriate or limitations in patient care of services. The proposed arrangement also clearly and separately identifies the performance measures that could result in incentive payments to the physician entity, OIG noted, adding that such transparency allows for public scrutiny of and individual physician accountability for any adverse effects of the proposed arrangement.

Turning to its anti-kickback concerns, OIG noted safeguards that mitigated against the risks that the proposed arrangement would be used to attract referring physicians or to increase referrals from physicians already on the requestor’s staff.

Among other safeguards, OIG highlighted the fact that membership in the physician entity would be limited to physicians who have been on the requestor’s medical staff for at least a year. In addition, OIG said that the per capita distribution of the incentive payments among the members of the physician entity would reduce the risk that the proposed arrangement might be used to reward individual physicians to refer patients to the requestor.

Source: Doctors’ Legal Forum, October 23, 2008

JUPITER: Rosuvastatin Reduces Events in Patients Without Hyperlipidemia but With Elevated hsCRP

Rosuvastain treatment of patients with better than average lipid profiles but with elevated high-sensitivity C-reactive protein resulted in a 44% relative risk reduction in cardiovascular events and a 20% reduction in all-cause mortality.

Paul Ridker, MD, lead investigator for the JUPTIER Trial Study Group, said, “While current guidelines for the prevention of heart attack, stroke and cardiovascular death endorse statins in patients with established vascular disease, diabetes and hyperlipidemia, the tension in the field is that these treatment strategies are insufficient because the mantra is that half of all heart attacks and strokes that do occur are among individuals who simply don’t have overt hyperlipidemia.” While many physicians try to improve identifying high-risk individuals by measuring hsCRP, a strategy of treating patients without established cardiovascular risk factors with statins remains controversial.

Trial results are often overlooked and implementation would have to occur in family practice and that is, indeed, where these patients were recruited. In a statement, American Heart Association president Timothy Gardner, MD said Jupiter was not designed to answer the question of whether the impact on risk was due to a reduction in inflammation or a reduction in LDL. Statins lower both LDL cholesterol and hsCRP. Thus the findings cannot determine whether lowering cholesterol, reducing inflammation, or a combination of both is responsible for the effects seen in this paper. In 2003, the AHA and the Centers for Disease Control and Prevention concluded that hsCRP, at physician discretion, may be useful to determine the preventive measures needed for people at intermediate risk.

Trial Results

JUPITER included 17, 802 participants from 216 countries with a median LDL of 108mg/dL and a median HDL of 40mg/dL. These are lipid levels that all of use would consider excellent, if not outstanding, in a prevention setting. The means hsCRP was elevated at 4.3mg/L. They were randomized to receive rosuvastain 20mg daily or placebo and were to be followed for 3 to 4 years for the primary endpoint: occurrence of a first major cardiovascular event. However, the Independent Data and Safety Monitoring Board discontinued the trial after a mean follow-up of 2 years due to a significant primary endpoint benefit in the rosuvastatin group.

Women and Minorities

Unlike many previous statin trials, JUPITER recruited 6,801 women and 5,117 minority patients. There has been controversy regarding whether statins confer the same event prevention and mortality benefits in these groups as seen in men. The trial had 26 prespecified subgroups, and the key is that all of them reached statistical significance on their own. Women are receiving the same benefit from rosuvastain as men, and the results are very reassuring for minority patients. There was no significant difference between effect in women versus men, those age 65 and older compared with younger patients, smokers versus nonsmokers, Caucasians versus minorities or between those with elevated hsCRP alone and those with other risk factors.

Source: Conference Update, November 10, 2008