Kalogredis, Sansweet, Dearden and Burke, Ltd.

News Briefs
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CHANGE TO THE MEDICARE REASSIGNMENT RULE REGARDING INDEPENDENT CONTRACTORS

The Medicare Prescription Drug and Modernization Act of 2003 (“Act”) made an important change to the rules governing the reassignment of Medicare payments by a physician to other physicians, groups or entities with whom he or she is engaged as an independent contractor.

As a general rule, Medicare only pays assigned benefits to the physician or other supplier who provides the service. Physicians are not permitted to “reassign” these benefits to another physician or entity unless such reassignment is permitted by one of the exceptions promulgated by statute and/or the Centers for Medicare & Medicaid Services (“CMS”).

Prior to the Act, a physician or physician group was only permitted to bill Medicare for services provided by an independent contractor physician where the services of the independent contractor were performed on premises owned or leased by the physician or physician group. The Act has revised this provision to provide that a physician or physician group may bill for the services of an independent contractor physician where the services were provided under a contractual arrangement between the independent contractor and the physician or physician group, if the physician or physician group submits the bill for the service and the contractual arrangement meets such program integrity and other safeguards as the Secretary of the Department of Health and Human Services may determine to be appropriate. This is a positive thing, since it now allows a practice to bill for the services of an independent contractor at a hospital or ambulatory surgery center.

A Program Transmittal issued by CMS on February 27, 2004 set forth the safeguards that are to be included in an agreement with an independent contractor to allow a physician or physician group to bill Medicare for his services regardless of the location at which they were performed;

· Joint and several liability is shared between the entity submitting the claim and the person actually furnishing the service, for any Medicare overpayment relating to such claim.

· The person furnishing the service has unrestricted access to claims submitted by the entity for the services performed by that person.

If you have any questions with regard to the revisions made by the Act to Medicare’s reassignment rules or its effect on existing relationships, please do not hesitate to contact our Firm.

Michael R. Burke

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