Becoming a Medical Director in Florida (5 Things to Know)

[Music] all right good afternoon everybody welcome to our seminar today uh i gotta say this is uh was supposed to be my second presentation of the day but my first one got postponed i was supposed to teach at my daughter's elementary school that was gonna be significantly different subject matter than this one this is a a little bit of a dry but important topic and something that i wanted to cover because i've noticed recently that i think this is being overlooked significantly by health care providers and by physicians and other folks qualified and being asked to serve as medical directors so these are some things i was speaking with a client recently that was in the process of recruiting to try and hire a medical director for a new clinic and these are some of the things that we were talking about as we were putting that deal together so here's our agenda for today we've got 30 minutes and we're going to talk about five things you need to know about becoming a medical director and uh and this is specifically uh these are what i think the highlights and a couple of gotchas and that's what we'll cover sort of in the uh next section here what can go wrong if you have questions again as always please address them either through the chat box or shoot me an email or give me a call afterward and i'd be happy to talk through the issues with you so just as a little bit of a introduction background florida is one of the states that allows what's known as the corporate practice of medicine so in some states only a licensed healthcare provider can own a clinic that provides health care services in florida a corporation that's not owned by specific health care providers can own a health care clinic under the florida health care clinic act but there are restrictions and one of the one of the biggies there is that you need to have a medical director in order to have a healthcare clinic license if you are a physician owned practice or if you have another type of healthcare practice and you or for some other reason uh you believe that you are exempt from uh meeting the requirements of the healthcare clinic act you can apply for an exemption and there are times that that we'll talk about a case at the end where folks have done that and it didn't work out so well because they uh they were not honest in the representations that they made to the agency it's the agency for healthcare administration in florida that's responsible for providing those exemptions or licenses so by the way the corporate practice of medicine doctrine covers certain health care provisions of health care services a health care provider providing for instance services by medical doctors can be owned by non-doctors and licensed under the healthcare clinic act but the same is not true across the board for all health care services so i want you to be aware of that for instance dentists can only own only dentists can own dental practices only optometrists can own optometry practices although you will see structures where you have a for instance a dentist who owns the practice but then you have a management company that might be owned by somebody else other than the dentist or the dentist and others that leases equipment does other services besides the actual dentistry service but we're going to focus on healthcare clinics licensed under the act and specifically the the big requirement here is that you have to have a medical director in order to get a healthcare clinic license for a clinic that does not that's not owned by healthcare providers so the relevant statute is section 400.9905 and that is the definitions section of the healthcare clinic act that defines a medical director as a physician who's employed or under contract with a clinic maintains a full and unencumbered license as a medical doctor an osteopath chiropractor or podiatrist if the clinic doesn't provide any of those specific services it may be able to appoint another florida licensed health care practitioner as a clinic director again you would have to look at the specifics of what the requirements are for the practice for instance certain social services psychology psychiatry and so forth you would not be required necessarily to have a somebody licensed you you wouldn't have a licensed chiropractor who provides services as a medical director for a psychology clinic uh but again these these are the the primary uh statutes that are identified and the primary chapters uh for the professionals the practitioner may not provide services as the medical director if those services are beyond the scope practice of the practitioner's license again you couldn't have for instance you would not have a podiatrist overseeing a surgical clinic that is beyond the scope of foot and ankle surgery there are again i mentioned there's some narrow exceptions for rehabilitation and other exceptions identifying the statute there's also several ways that folks can get exemptions and so you'd have to look at the statute now once you've identified a medical director what do you need to do the first thing is you have to have a written agreement between the clinic and the medical director and amazingly although this is very clear in the statute that you have to have this agreement or you can have a in lieu of a of the written contract you could have the medical director sign the aqua form medical director attestation that is in the available in the rules and you can pull the form i believe it's on oppa's website and you can have the medical director sign that form but the medical director has a sign and a purpose primary purpose is so that the medical director acknowledges in writing that they are accepting all the responsibilities for overseeing the clinic which includes all the statutory activities that are identified in the in the relevant statutes and we'll touch on those in our in our next point so you'll find these requirements i put the rule sites in here and if you want more information if you have any questions about anything that we that i talk about as far as where the rules are the statutes and i'll talk about a couple cases at the end uh by all means again uh feel free to shoot me a message or an email or give me a call and i can give you that but here's the role citation it's rule 59a 33.012 of the florida administrative code pertaining healthcare clinics so third thing that you need to know after knowing who can serve as a medical director and and knowing that you have to have a written contract is uh this is another one that gets overlooked sometimes is the medical director must be identified by conspicuous language in the clinic and the clinic must publish and conspicuously post a schedule of cash payment charges for services uh by cash payments charges those are the regular charges that the clinic serves the clinic charges for services provided to people who just walk in the door and pay cash and that has to be posted the relevant florida statute for that is again 400.9935 uh section subsection 1ai pardon me when i take a sip of water and if the clinic doesn't do that you can face a fine of up to a thousand dollars a day so you need to have proper signing and signage and publication of the medical director and the charges that the clinic charges to cash paying patients all right now here's a big one number four fourth thing that you need to know before becoming a medical director or about being a medical director is uh first thing of this list there's been a list of things that we'll hit on here the medical director is responsible for the day-to-day supervision of the health care clinic all too often we see situations where somebody is serving as a medical director asked to serve as medical director and and it looks like a nice side gig but they're not visiting the clinic they're not on site they can be available to answer questions but somebody wants to use their name uh essentially just to get to be able to get a healthcare clinic license and so they approach somebody who's qualified such as a medical doctor and say hey i'll pay you x to be the medical director for my clinic uh can i use your name and have you sign this agreement and and you don't have to do anything we'll just agree to pay you x amount of dollars and and you get paid for being the medical director well that sounds like a great gig uh the issue there is that you need to understand if you're that physician who's signing up for those responsibilities you are now accepting legal responsibility for the compliance of the clinic this comes back to the written attestation or written contract requirement that you've now agreed that you're going to oversee compliance this includes such things as record keeping and billing and so forth these are all things that we've listed below here in the slide you need to ensure that all practitioners providing services or supplies maintain a current and unencumbered license in florida uh and that they maintain their appropriate licensing and certifications so not only are you responsible for yourself and your names on the door for the clinic but you also have to make sure that everybody who's in there providing services does what they're supposed to be doing as far as their licensing and certification so for instance there's a case i'll tell you the name of it i don't have it here in the materials but a couple years ago there was a case called might be one that we're going to talk about later the plaintiff in the case is state farm i've got the case actually we are going to talk about this case but state farm the dna diagnostic institute this was a case down in the southern district of florida in south florida it was a federal case brought by state farm where state farms sought judgment against this clinic with an order to not have to pay fees and other charges to the clinic that were billed through insurance because the clinic was not in compliance with the relevant statutes and rules and one of the things that happened there is that they had a person operating an x-ray machine who was not properly licensed there was another person who was operating the x-ray or operating another machine and they were again not properly licensed and supervised in one circumstance the person who was operating the machine was required to uh could only operate the equipment if they were being supervised by a physician on site and the physician was never on site who was serving as a medical director the medical director wasn't aware of the requirement the physician medical director admitted to not being on site for regular supervision and so the person who was performing the x-ray services on the patients was operating in violation of the statute and that comes back on the medical director who's responsible for that activity another big one here is that the medical director is required to oversee billing and that includes what i put in red here conducting systematic and this is right out of the statute you're required to conduct systematic reviews of clinic billings to prevent fraud we are seeing an uptick we've been seeing it for a while we've seen them in pip cases particularly the florida personal injury cases mostly involving auto accidents where the cases are brought by uh personal injury lawyers for claims arising out of an auto accident and the patient goes and receives services and we have these auto insurance companies who have been suing the health care clinics providing the services saying that the clinics have not been properly billing for those services because they're not operating in compliance with the rules and requirements that apply to the clinic and for that reason they don't need to the state farm or the insurance company whoever brings the case doesn't need to pay for those services and they have been winning those cases not only that we are now seeing new situations where medical directors and other physicians are being sued in fact i will go into detail on the case we have a case ongoing right now where we are representing a couple of physicians in a case where an insurance company has brought a claim for fraud and a fraudulent conspiracy and claims under rico the racketeering uh the federal racketeering statute racketeering influence influence practices act alleging that the all the monies that were paid by the insurance company for member benefits was paid as a result of the fraud perpetrated by a conspiracy between the provider and the physicians and other players who were involved and now seeking to recoup all that money that was paid plus seeking a determination that they don't have to continue to pay for these these services and charges and seeking um in some some circumstances in case we're involved in they're seeking punitive damages and other damages alleging that uh everybody was involved in a big fraud to defraud the insurance company with cases like that again it it it doesn't matter is it of course it matters if the you know what the outcome of the case is but if you are a professional providing services and you are named in one of these cases it is an automatic black mark everybody it becomes a public record and you are not going to be able to escape this so even if you are perfectly innocent and you've done nothing wrong and you are sued in one of these conspiracy cases where everybody is netted up and wrapped into the same net and painted with the same brush with the same broad strokes you run a risk uh being involved in a clinic that's not operating completely properly uh so since we're seeing that i i think it's really important for folks to understand that uh again taking on a responsibility as a medical director you are taking on a lot more than just putting your name on the door and receiving payment for that uh again i've flipped over here onto the next slide um any patient referral agreements you need to review those you need to be on the lookout for unlawful referrals anything in violation of the any kickback or stark act or under the federal or florida patient self-referral act if you have questions then you should have counsel review those if you're a physician and you're serving as medical director to a clinic and that clinic is paying you to oversee these activities you are not a lawyer you are a physician and and nobody reasonably in my view is going to expect a physician to read through the rules and read through the statutes and make sure that uh everything that the clinic is doing is legally proper you need to understand from a factual standpoint what's happening but uh you should not be bashful about making sure that the clinic has legal counsel and and this should not be a physician expense or personal expense for the medical director this should be a clinic expense uh the clinic should have counsel that reviews these issues from a legal standpoint and make sure that you're in compliance so that's a big tip if you are a medical director make sure that the clinic that you are serving for whom you've signed a contract with uh either hires counsel or gives you a budget so that you can hire counsel to make sure what you're doing is proper and review again review the billings review the referral relationships review the licensing and compliance issues there are certain no-no's that are spelled out right in a statute another one of these state farm cases again involved um x-rays the statute says that you can't refer mris you can't pet scans ct scans and some of the violation activity is considered a felony under florida law so again you look to florida statute 400.9935 for all this we'll move on to number five the five things you need to know before becoming a medical director number five on this list is that there is maximum numbers that are spelled out in a statute the medical director can serve in that role for no more than five clinics with a cumulative total of no more than 200 employees among all the clinics and all the clinics must be within 200 miles of each other so when you think about i put this one last because when you think about the requirements for what you really need to do in order to be fulfilling your responsibilities as a medical director it'd be tough for one person to to do this for you know several clinics spread out through the out throughout the entire state of florida with several hundred employees so there's a limit that's in the statute and that's found in the administrative code so some of these things you'll see are found in statutes some are found in the administrative codes and then sometimes we get further interpretations of a specific rules laws statutes through cases that find their way through the state or federal court system so i mentioned the pip cases and it has been pretty well firmly established now even though the statute may not spell out a private cause of action or private rate of action uh and and i'll back up and explain what that means in a second but even though there's no private rate of actions felt on the statute these insurance companies have been able to bring these claims against clinics that are operating unlawfully and have success in having not only outstanding billables scratched off and down to zero or gotten an order that they don't have to pay them but also got recoupment from not only the clinics but from the employees of the clinic including the medical director to the extent that either a the uh that employee or medical director was was paid improperly so there's what's called an unjust enrichment claim that basically says you were paid x amount of dollars uh last year for being the medical director your responsibilities were this you were supposed to make sure the clinic was operating in compliance and you failed to do that and because you failed to do that you didn't do your job because you didn't do your job you weren't entitled to be paid you were paid 50 000 you now have to get that 50 000 back and you have companies these insurance companies that are going after that money so if you think that one sounds bad not only do you have a situation where you can end up having to give back all the money that you were paid but if you could sued in a conspiracy action uh you can now be uh facing a claim where again i'm seeing these by insurance companies where the insurance company is saying uh as part of the conspiracy and helping to further the conspiracy the insurance company has shelled out what's called two million dollars over the past year or five million dollars over the past three years for uh billings and claims that were improper because the clinic was not operating legally and the physician who signed up to be the medical director or the physician who signed up to provide the services knew that that was that the clinic was operating improperly but went along with it anyway was part of the conspiracy to improperly bill the insurance company and now those employees including the director and any any other physicians and providers should be held jointly and severally liable for the whole amount due to state farm so if state farmers seeking five million dollars back from the clinic they're trying to go after and i'm using state but i've seen it with allstate i've seen there's other insurance companies but i have a state farm case i'm going to talk about uh they're going to go after that full amount from everybody and collect from whoever they can get from and on top of that they're going to try and go after punitive damages in some circumstances so this can really uh be a situation where you have a lot more at risk than even what you were paid so what's your time worth what's all the stress worth and uh you know what's the risk that you face when you take on these responsibilities i by no means want to discourage anybody from doing this i have several clients who do serve as medical directors i also represent uh clinics who have medical directors the the fact that we have this ability in florida every state doesn't have that where you can have a health care clinic that is not owned by the providers but is owned by a separate entity that hires the providers i personally think that's a good thing it allows for a greater ability to separate out the business of opera of health care and the providing of services which is good some people are good business people and some people are good providers and they're not always the same folks but what comes with that privilege that we have here in florida is the responsibility to make sure we're following the obligations in the statute so let's take a look at this case here i'll say you know what what can go wrong well touch up on a couple of these but in this case this uh state farm the bna diagnostic i'm looking at my time here i have a few minutes i can discuss this case i want to pull it up here state farms sued a clinic they said two different physicians at least two different ones from what i can see from the case that had agreed to serve as medical directors at different times so this covered the spend a few years and they also sued a couple of the employees for this was the the case where they sued them for providing the x-rays here's some highlights from the case what happened here is the the first physician uh who signed on to be the medical director uh was there for just about a year and then there was a second position that came on and during that time there were two employees who were providing x-ray services one was not properly licensed at all and then another employee had a certification but not proper license to operate the equipment on his own in deposition testimony apparently one of the doctors admitted that he didn't conduct systematic clinic reviews and systematic reviews of billings he never reviewed the statute he wasn't aware of the requirements that we talked about today 400.9935 and uh and admitted that he was uh unfamiliar with those requirements and he assumed that the bills were were lawful he testified because he said and this is quote billing is just billing and so he never looked at it that closely um another big no-no was the clinic in this case was routinely waiving co-payments and deductibles and that's a big no-no it's a violation of florida's insurance statutes a clinic cannot routinely waive co-payments and deductibles for patients it can be considered in some circumstances insurance fraud it can also be considered in some circumstances a violation of the anti-kickback statute both at the state and federal level so you can't just as a matter of routine business practices waive your deductibles and copays he admitted that that he never checked to ensure that the folks providing the other employees were properly licensed and certified uh to provide x-ray services and he did not review the billings for x-ray services that went out from the clinic the court found that one here as we listen to slides the medical director failed to meet his basic obligations as the medical director and the x-ray services that were referred internally were not lawful they violated the statute and other x-ray services that were provided by unqualified employees were not lawfully paid and then i mentioned this earlier the unjust enrichment claim any payments that the insurer made were the product of unjust enrichment because the statute would only require the insurer to pay uh for services that were properly uh provided by a clinic that was in compliance under the statute here's what gets uninteresting about this case as well is in this case the uh the plaintiff went back several years to try and recover for uh what what the plaintiff called were essentially improper fraudulent uh charges that were done in violation of the statute one of the defenses that was raised by one of the physicians a good defense was statute of limitations you can only go back for a certain period of time after which your claim is time barred but the uh plaintiffs made a good argument here they argued that the statute of limitations was what we call as told there's this concept of equitable tolling where if you have a claim but you're not aware of the claim because it is uh willfully you know the the rights under that claim you know a common would be uh if somebody lies to you and and commits a fraud and you suffer damages but you're not aware of it until a later time somebody steals something from you that's locked away in a safe you don't find out about until five or ten years later the statute limitations is run but if if you had no reason to know about it and especially if the person who stole from you or lied to you went out of their way to lie to tell you oh yeah i left all the all the money's in the in the safe i check it every day it's always there and they're signing off on a little log that says i'm checking this and everything is good that you have a right to rely on that and if you later find out that it was untruthful you can bring up this concept called equitable tolling to toll or stop or pause the statute of limitations and hear what the plaintiffs argued in the state farm case was that when the when the clinic filed for its license and did its uh its annual filings and when they submitted it first i want to file for its license it said it would comply with all the requirements under the health care clinic act and it didn't do that that was a fraudulent representation and then further when they submitted payments submitted charges for payment to state farm to the insurance company they represented they signed off on those charges and they represented that those charges were the result of proper uh procedures proper billings and the charges were properly payable and the clinic was in compliance with the requirements under the health care clinic act and all the requirements under the contract with the insurance company all of those representations were improper and they were essentially fraudulent representations because the clinic was not in compliance and the court agreed and so the court said that the time period that had passed did not cause the statute of limitations to kick in because the claims the plaintiff's right to bring those claims were echo equitably told and they were allowed to bring the claims at a much later date so that case represents uh really you know what the end end of that case i'll tell you what the defendants ended up with the physicians there from what i gather sometimes when you read these court opinions it's not exactly clear what's happening but reading between the lines the total claim against the clinic was over a million dollars it was um somewhere in the area of when i add everything up it looks like probably about a little over eight hundred thousand dollars against the clinic itself with another seven hundred thousand dollars the court ordered were outstanding charges that state farm didn't have to pay so we're looking at 1.5 million for against the clinic each of the physicians were hit one was fit hit for over 300 000 and the other one was hit for uh almost 200 000 and because that's less than a total amount and i didn't see a conspiracy claim the way i read that case is they probably were required to put back any money that they had gotten from the clinic as pay or other compensation because it was an unjust enrichment issue and so they were not entitled to keep that pay and they had to put it back the other employees by the way they didn't get off either the folks who were one of the defendants the one who was not properly licensed to provide x-ray services required was required i looked at a judgment of 44 000 almost and then the there was another defendant who got out of the case early so we don't know what happened presumably that defendant settled uh so this is just one case there's a couple other cases if i had time might go into them a little bit i do want to just mention we're going to close up here but there's a another case called give me a moment here state farm be first care solutions and this one was notable because and i've seen this situation before uh i'm not i'm not a licensed health care provider but my son daughter cousin somebody else is and someone said look i'm gonna put the company in your name and then that way we can get an exemption we're not required to get a separate medical director and will run the health care clinic and that's what happened in this other case of state farm v first care solutions is they tried to say that the company was owned by somebody who didn't actually own the company and that's always a big a big no-no it's pretty easy to go back and look over over a period of years and find out you know who's on the tax returns or the k-1s who's reported this to taxable owner of the company look at operating agreements and other documents who's got the authority to make decisions on behalf of the company who has the keys who hires and fires who signs all the contracts uh there's there's all sorts of things that we can look at to find out if somebody is really the owner of a company or not i'll have to have folks sometimes suggest suggested you can look on some biz and see who the manager is of an entity some business what we have here in florida where the the corporations and limited liability companies and other entities are listed for public view sun vis only requires you to list one manager of talking about a limited liability company where most entities operate now you're only required to list one manager you're not required to list members you're not required to list all the managers so oftentimes companies a lot of my clients will only list one manager oftentimes that manager might be another company might not be an individual but that doesn't mean that that's the owner of the company it doesn't it's not indicative of who the owner is uh if you go on and you look and you see managers listed it doesn't mean that that person owns any interest you can certainly be a manager without being a member but this game where folks want to own the clinic and then say that somebody else owns it in order to avoid licensing that blew up in the face of the defendants in that that other case that first care solutions case in a 2017 opinion uh the court came down on the health care clinic the uh person who was the real owner of the clinic that got hit for a judgment and two other individuals who at different times had uh allowed their names to be used they were healthcare providers who allowed their names to be used as the owner of the clinic for purposes of filing with aca so again a big big no-no so to conclude here uh understanding that our demand for medical directors for health care services in general and medical directors in florida is high and as a practitioner or if you're representing a practitioner it will not be you will see commonly uh folks get asked to serve as a medical director and i would like folks to understand when that uh opportunity comes about or when that role is presented that there's legal responsibilities that come with it and we have this little rhyme here when in doubt seek counsel out so that's our conclusion of our first 30 minutes for uh this month thank you again for joining us see you next time [Music] you

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Keywords: Becoming a Medical, Medical Director, Florida

Id: Au3ACM_35PU

Length: 34min 0sec (2040 seconds)

Published: Thu Nov 19 2020