Jeannine LeCompte, Publishing and Research Specialist
Just as is the case with outside vendors, all contracts between Medicare- and Medicaid-approved long-term care facilities (LTCs) and professional service providers must adhere to the same strict compliance and ethics guidelines required by the Centers for Medicare & Medicaid Services (CMS).
These professional service providers include, but are not limited to, outside companies providing staff, and individual contractors such as therapists, physicians, and any other professional service such as individuals or companies providing accounting or tax services. In other words, this means any professional service offered by outside contractors who are not employees of the LTC are covered under this category.
There are numerous federal and state laws protecting against fraud and abuse in the healthcare industry which are applicable to such contractual relationships, and the LTC carries the ultimate responsibility to ensure that all these statutes are adhered to. The strict application of the LTC’s own compliance and ethics program to all outside professional services providers serves as the first line of defense against allegations of fraud, waste, and abuse.
There are other general rules which should always be kept in mind when contracting with outside professionals. These include:
- A strict ban on any sort of commission or fee arrangements with firms or persons that are not serving as bona fide agents or consultants, or with any firm in which a government official or employee is known to have an interest. The only exception to this might be one which is permitted by an applicable law.
- Commissions or fees paid to an agent or consultant must be “reasonable” and of a market-related value. All such commission and fee arrangements will be covered by a written contract, which must be reviewed by the compliance and ethics committee and the LTC compliance attorney to ensure that there are no real or potential breaches of the law.
- All contractual arrangements with physicians, therapists, nurses, and all other potential referral sources must be reviewed by the compliance and ethics committee to ensure compliance with federal and state laws.
All contractual arrangements with said professionals must also be fully documented in written form. This written contract must:
- Specify a clear description of the services to be rendered
- Contain a representation that no attempt will be made to improperly influence government officials or inspectors
- State that all professionals will abide by the LTC’s compliance and ethics program
- Contain a provision for ending the contract should the contractor be found to be in breach of any of the applicable laws
In addition, no professional services provider may work on a percentage or incentive basis that links compensation to resident revenue increases.
Finally, all professional service providers must undergo background screenings and checks to ensure that they are not on the list of excluded individuals or entities or debarred contractors.
