• patient-centered care;
• zero tolerance of serious events and medical errors;
• elimination of health care disparities;
• priority to patient safety and quality improvements; and
• innovation and experimentation in health care and health facilities.

Unfortunately, the Draft is not satisfactorily clear as to whether a group practice operates an office or an outpatient health care facility, as discussed further below. While an office used primarily for a practitioner’s private practice is not considered an “outpatient health care facility,” the Draft does include in the definition of “outpatient health care facility” clinics and group practice facilities that provide diagnostic and treatment services (other than primary care) in a specific specialized area of medicine. It does this by defining “office” as a place where professional activities are conducted, but not extending to specialty clinical areas for diagnosis or treatment. We consider this lack of specificity a significant concern for many medical specialty and subspecialty practices and hope it will be dealt with further before the final Draft regulations are adopted.

The Draft also excludes from the definition of “outpatient health care facilities” hospital-licensed services provided on-site. However, outpatient services that are not provided under the hospital license, even if on-site, are not excluded from the definition. This may pose a problem for some of our clients, as well.

Problem areas

We see a number of shortcomings, and we hope to see them corrected during the comment process. The Draft on its face lacks enough detail for physicians to determine whether the services that they provide rise to the level of requiring licensure. By excluding an “office” used primarily for the private practice of a health care practitioner, but including clinics and group practice facilities providing specialty services, as noted, the Draft leaves a large gray area.

Query, for instance, whether a group practice using a “centralized location” to provide certain in-office ancillary services (radiology services, physical therapy services, etc.), as contemplated under the Stark II legislation, would require PADOH licensure? Taking the question further, query if the answer would be different if the group also used the location to provide non-ancillary services like physician office visits? More detail is needed for physicians and their advisors to determine whether or not they will need to follow the licensure process in order to provide certain ancillary services that are increasingly important to their practices.

We see another problem in that the Draft lumps outpatient health care facilities together with hospitals in many of its proposed requirements. This requires a high level of detail and compliance relating to such matters as staffing, governance, business dealings and finance. The requirements probably go beyond what most physicians expect when they consider whether to pursue an ancillary service undertaking. Covered facilities would also have to develop and comply with a “patient bill of rights” as set out in the Draft.

Charity Care

The Draft also contains charity care requirements that would apply to hospitals and licensed outpatient health care facilities. Under the Draft, legal action may be taken by a health care provider to collect outstanding amounts only where there is evidence that the patient or responsible party has income and/or assets to meet his or her obligation. Health care providers will not be permitted to force a sale or foreclosure of a patient’s primary residence to pay an outstanding medical bill. This would impose another layer of complexity and regulation on physicians who already struggle to determine when they should pursue the collection of outstanding bills from a patient.

Conclusion

Please keep in mind that the Draft has only been promulgated and posted in draft on the PADOH website. It has not been formally published in the Pennsylvania Bulletin (or subject to the formal review and comment period associated with proposed regulations) and is currently subject to change; the PADOH is seeking comments on how to make the Draft better. However, we hope this discussion shows you what may be in store for Pennsylvania physicians that provide (or may decide to provide in the future) ancillary services within their practice.

Visit the PADOH website (listed above) and click on the link for “Draft Regulations” and consider sending your comments and suggestions, especially if you care about being further burdened by physician practice regulation. Especially of concern, in our view, are proposals that would in many instances lump the requirements for outpatient health care facilities together with hospitals. If the link is not yet available when you read this article, you may contact the PADOH directly to request a copy. And, of course, look for the Draft’s final publication in the Pennsylvania Bulletin.

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