United States: Healthcare Legal News: Volume 5, Number 3

RESPONDING TO SUBPOENAS AND OTHER REQUESTS FOR PERSONAL HEALTH INFORMATION: TAKE THEM AT FACE VALUE

by Billee Lightvoet Ward, Of Counsel

Healthcare providers and other HIPAA covered entities receive requests for protected health information ("PHI") from a variety of sources on a daily basis. Such requests can range from informal requests made during the course of conversation with a patient or family member, to written requests or demands served by law enforcement personnel or through a formal legal process. For more common requests, such as when a patient requests access to his or her PHI, covered entities typically have established procedures for documenting the request and responding in a manner that complies with HIPAA and applicable state laws. Although requests for PHI in the form of subpoenas, requests for production and other legal documents may be less common, it is no less important for covered entities to know what is (and is not) required of them in responding to such requests.

The general principle under HIPAA is that covered entities may use or disclose PHI only as permitted or required under the HIPAA Privacy Rule or as authorized in writing by the patient (or his/her personal representative) who is the subject of the PHI. HIPAA contains various exceptions to this general principle that provide the boundaries within which PHI may be used or disclosed in specific situations. In the context of litigation or other legal proceedings, if a covered entity is a party to the proceeding, the covered entity is generally permitted (with certain exceptions and limitations) to use or disclose PHI for purposes of the proceeding as part of the covered entity's healthcare operations. It is often the case, however, that covered entities receive requests or demands for PHI in relation to legal proceedings to which they are not parties. In those situations, if the patient's authorization cannot be obtained, HIPAA permits covered entities to disclose PHI under certain conditions. Because HIPAA distinguishes between requests that are authorized by an order of a court or administrative tribunal, and subpoenas or other requests that are not accompanied by such an order, it is crucial to make this determination from the face of the documents received.

Judicial and Administrative Proceedings: Disclosures Pursuant to Court Order

HIPAA permits covered entities to disclose PHI in the course of any judicial or administrative proceeding "in response to an order of a court or administrative tribunal, provided that the covered entity discloses only the protected health information expressly authorized by such order." See 45 C.F.R. 164.512(e)(1). A court order may require production of Tom Smith's medical records from January 1, 2000-December 31, 2000, for example. In responding to such an order, the covered entity must be attentive to the language on the face of the order and ensure that it limits disclosure of PHI only to what is specified in the order. Only Tom Smith's medical records should be produced, but production should include his full medical records from the year 2000. The covered entity must fully comply and respond to the order in a timely fashion or risk being held in contempt of court.

Judicial and Administrative Proceedings: Requests Not Accompanied by a Court Order

When a covered entity receives a subpoena, discovery request, or other request that is not accompanied by a court order, the covered entity must ensure that additional protections are in place before disclosing the PHI. These protections are referred to as "satisfactory assurances" and can come in the form of: (1) written assurance that good faith attempts have been made to notify the patient; or (2) written assurance that the parties have agreed to or requested a qualified protective order. See 45 C.F.R. 164.512(e)(1)(ii).

  1. Notice to the Patient. To allow for disclosure of the requested PHI, the covered entity may obtain a written statement and accompanying documentation from the requesting party that: (A) the party has made a good faith attempt to provide written notice to the patient; (B) the notice included sufficient information about the legal proceeding to permit the patient to raise an objection to the court; and (C) the time to object has passed, and the patient did not object or any objections have been resolved and the disclosure is consistent with such resolution. See 45 C.F.R. 164.512(e)(1)(iii).
  2. Qualified Protective Order. Another option that allows the covered entity to disclose the requested PHI is to obtain a written statement and accompanying documentation that the parties to the proceeding have agreed to a qualified protective order and presented it to the court or the party requesting the PHI has requested a qualified protective order from the court. The qualified protective order must prohibit the parties from using or disclosing the PHI for any purpose other than the legal proceeding and require the parties to return the PHI to the covered entity or destroy the PHI at the end of the proceeding. See 45 C.F.R. 164.512(e)(1)(iv).

A covered entity is permitted to disclose the requested PHI if, in lieu of obtaining satisfactory assurances from the requesting party, the covered entity makes reasonable efforts on its own to provide the required notice to the patient or seek the qualified protective order. See 45 C.F.R. 164.512(e)(1)(vi).

Additional Considerations:

When a covered entity receives any request for PHI in the context of litigation or other legal proceedings, HIPAA should be considered at the forefront. It can be helpful to remember that, for purposes of HIPAA, disclosure in response to such requests is permitted but not required; although there may be other statutes, court rules and practical considerations that also apply and may warrant or compel disclosure. In the process of assessing its response, the covered entity should also consider whether de-identified information would be responsive to the request. De-identifying PHI, or obtaining a HIPAA-compliant authorization from the patient, can significantly reduce potential HIPAA liability exposure. If PHI must be disclosed, covered entities must make reasonable efforts to limit such PHI to the minimum necessary to accomplish the intended purpose of the request.

It can sometimes be difficult for covered entity personnel to determine whether a subpoena or other request constitutes a court order or is simply a subpoena for records. Legal documents sometimes have a tendency to look alike, and the difference can depend on who is signing the document (a judge versus an attorney, for example). Additionally, subpoenas, civil investigative demands, and similar requests that arise in judicial and administrative proceedings may also be served in the context of a law enforcement inquiry or health oversight activity. The HIPAA Privacy Rule contains specific requirements for disclosures in those contexts, so careful consideration must be given to each request to determine which HIPAA exception applies. In addition, each covered entity should have clear and compliant policies and procedures that outline the internal processes for handing responses to subpoenas and other requests for PHI. If there are questions or uncertainties that arise, covered entities should consult with an attorney who is well-versed in HIPAA and applicable state privacy laws to ensure that all applicable legal requirements are met.

QUI TAM LAWSUITS AND THE STATUTE OF LIMITATIONS

by Keith C. Dennen, Member

In Kellogg Brown & Root Services, Inc. v. United States ex rel. Carter, 575 U.S. ____) (2015), Justice Alito stated "[t]he False Claims Act's qui tam provisions present many interpretive challenges." Lawyers and judges who struggle with those challenges understand the truth of that statement. The United States Supreme Court recently resolved two of those issues.

  1. Does the Wartime Suspension of Limitations Act toll the statute of limitations? No, that act only tolls criminal proceedings.
  2. Does the "First to File" Rule bar subsequent lawsuits if the first action is dismissed? The "First to File" Rule bars a "qui tam" action during the pendency of the first action and, upon its conclusion, another relator may file a lawsuit involving similar facts.

False Claim or "qui tam" lawsuits have proliferated as whistleblowers and their legal counsel have discovered the financial benefits of being the "qui tam" relator. Although "qui tam" lawsuits have become synonymous with healthcare, Congress enacted the False Claims Act in 1863 due to the "rampant fraud" being committed by suppliers to the Union Army during the Civil War. Congress recognized that it was impossible for the federal government to police this industry effectively because of the sheer number of contractors. Therefore, Congress provided a process in which a private citizen with knowledge of fraud (called a relator) could file a lawsuit on behalf of the government. To incentivize the filing of these lawsuits, the False Claims Act permitted the relator to obtain a percentage of the ultimate recovery by the government.

The False Claims Act contains an express statute of limitations (31 U.S.C. § 3730). That statute requires a lawsuit to be filed within six (6) years of the violation, but no later than three (3) years after the date that the United States should have known about the violation. In Kellogg Brown, the question was whether another statute -- the Wartime Suspension of Limitations Act – tolled the running of the statute of limitations. The Supreme Court held that it did not. Instead, the Court held that the express language of the Wartime Suspension of Limitations Act made that act applicable only to criminal prosecutions and not to cases involving "civil claims."

The False Claims Act also includes a provision that bars an action if it is filed after another action -- the "first to file" bar. Specifically, the False Claims Act provides that "no person other than the Government may intervene or bring a related action based on the facts underlying the pending action." 31 U.S.C. § 3730(b)(5). In Kellogg Brown, two qui tam lawsuits were filed that alleged substantially similar facts. The Kellogg Brown lawsuit was the second lawsuit filed. Therefore, the trial court dismissed that lawsuit as being barred by the "first to file" bar. While an appeal was pending, the first lawsuit was dismissed. The relator refiled his lawsuit, but the court dismissed the lawsuit once again stating that the "First to File" bar applied. The Supreme Court rejected this argument noting that the express language of the statute provided that the first-to-file bar ceases once the earlier action is dismissed.

For healthcare providers, the Kellogg Brown decision removes one source of uncertainty and creates another source of uncertainty. The False Claims Act statute of limitations will not be tolled during time of "war" regardless of the definition of "war", but the settlement or dismissal of a qui tam action will not necessarily bar another individual from filing a lawsuit on the same grounds. The Supreme Court noted that the dismissal of the first filed action may have "claim preclusion" effect if the action is decided on its merits; however, the Court relegated that issue to another day. Healthcare providers should consider the impact of this decision during settlement discussions for qui tam cases.

OIG FRAUD ALERT REGARDING PHYSICIAN COMPENSATION ARRANGEMENTS: WHAT YOU NEED TO KNOW

by Jessica L. Russell, Associate and Emily Procyk, Summer Associate

On June 9, 2015, the Department of Health and Human Services' Office of the Inspector General ("OIG") issued a new fraud alert regarding physician compensation arrangements, with a particular emphasis on medical director arrangements. The OIG urged physicians to "carefully consider the terms and conditions of medical directorships and other compensation arrangements before entering into them," so as to avoid violation of the Anti-Kickback statute.

This Fraud Alert serves as a reminder to physicians that prior to entering into compensation arrangements, they should verify that the payments reflect fair market value for the services provided and are not calculated based on the volume or value of the physician's referrals of patients covered by a federal healthcare program or other business generated between the parties. This latest fraud alert mentions medical directorships in particular because of the concern that schemes exist to compensate referring physicians improperly through positions that require few actual duties. However, medical directorships are just one type of physician compensation arrangement that could violate the Anti-Kickback statute.

The Anti-Kickback statute is both a civil and criminal statute that prohibits the exchange (or offer to exchange) of anything of value to induce or reward the referral of patients participating in a federal healthcare program. The statute establishes penalties for parties on both sides of the prohibited transaction ranging from a fine per violation of up to $25,000 to imprisonment for up to five years. A successful conviction under the Anti-Kickback statute requires proof that a defendant intended to engage in illegal activity, though not necessarily proof that a defendant knew the activity violated the Anti-Kickback statute specifically.

The OIG has adopted various "safe harbors" to the Anti-Kickback statute, which create a presumption of legality for arrangements that meet their criteria. Structuring physician compensation arrangements to comply with a specific safe harbor – such as the employment or the personal services and management contracts safe harbor – can help ensure that physicians, their employers, and other parties paying for physician services avoid the Anti-Kickback statute's significant penalties.

Impact on Physicians:

This is the third fraud alert in three years in which the OIG has focused on individual physician behavior. The alert was spurred by settlement agreements the OIG recently reached with 12 individual physicians accused of entering into questionable compensation arrangements. The OIG pointed to three major violations of the Anti-Kickback statute by these physicians: (1) the payments received by the physicians took into account the physicians' volume or value of referrals and the payments did not reflect the fair market value for the services the physicians performed; (2) the physicians themselves did not provide the actual services required under the agreements; and (3) some of the physicians had entered into arrangements in which a healthcare entity affiliated with the party paying for the physicians' services also paid the salaries of the physicians' office staff, which constituted additional improper remuneration.

The Fraud Alert puts individual physicians on further notice that compensation arrangements could have Anti-Kickback implications if they are not carefully structured. Because the Anti-Kickback statute is an intent-based statute, issuance of a fraud alert makes proof of intent a smaller hurdle for the government. Physicians should also be aware of the OIG's continuing focus on individual physicians along with large healthcare groups and other healthcare providers. Physicians should thus be careful to structure their compensation arrangements so that they fit within a safe harbor to the Anti-Kickback statute and avoid arrangements that are considered "red flags," such as bonuses based on patient referrals and certain percentage-based payment arrangements.

Impact on Hospitals and Other Healthcare Providers:

Compensation arrangements in violation of the Anti-Kickback statute implicate both parties to the agreement. As a result, hospitals and other healthcare providers must also ensure that medical director agreements and other physician compensation agreements are structured in compliance with the Anti-Kickback statute. Meeting the requirements of the personal services and management contract safe harbor to the Anti-Kickback statute is one way to avoid liability. Compliance with that safe harbor requires that the contract between the healthcare provider and a physician meet the following requirements:

  1. The agreement is set out in writing and signed by the parties.
  2. The agreement covers all of the services the physician provides to the principal for the term of the agreement and specifies the services to be provided by the physician.
  3. If the agreement is intended to provide for the services of the physician on a periodic, sporadic or part-time basis, rather than on a full-time basis for the term of the agreement, the agreement specifies exactly the schedule of such intervals, their precise length, and the exact charge for such intervals.
  4. The term of the agreement is for not less than one year.
  5. The aggregate compensation paid to the physician over the term of the agreement is set in advance, is consistent with fair market value in arms-length transactions and is not determined in a manner that takes into account the volume or value of any referrals or business otherwise generated between the parties for which payment may be made in whole or in part under Medicare, Medicaid or other federal healthcare programs.
  6. The services performed under the agreement do not involve the counselling or promotion of a business arrangement or other activity that violates any state or federal law.
  7. The aggregate services contracted for do not exceed those which are reasonably necessary to accomplish the commercially reasonable business purpose of the services.

OIG guidance has also suggested several best practices that providers and hospitals should employ for physician compensation arrangements, including maintaining time logs and other accounts of services performed by physicians, implementing and maintaining a compliance program, and ensuring there is a legitimate business justification for any arrangement with a physician.

When entering into a compensation arrangement, both parties must ensure that the physician's compensation reflects the fair market value of the services provided and is not determined in any way by the number or value of patient referrals. Compensation can include anything of value and is not limited simply to a paycheck. To avoid Anti-Kickback liability, physicians and healthcare providers should carefully structure physician compensation arrangements in such a way that they meet the requirements of an applicable safe harbor.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
 
In association with
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement

Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of www.mondaq.com

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.

Disclaimer

Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.

Registration

Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.

Cookies

A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.

Links

This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.

Mail-A-Friend

If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.

Security

This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at enquiries@mondaq.com.

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.