OIG Advisory Opinion on Compensating On-Call Physicians

On May 21, 2009, the OIG posted an advisory opinion regarding a proposal to compensate physicians for on-call services performed on behalf of it’s uninsured patients.  Although the OIG acknowledged the legitimate reasons for such arrangements, they also stated there is a substantial risk that improperly structured payments for on-call coverage could be used to disguise unlawful remuneration.  However, the key inquiry is whether the compensation is: (i) fair market value in an arm’s-length transaction for actual and necessary items or services; and (ii) not determined in any manner that takes into account the volume or value of referrals or other business generated between the parties.  In this proposed arrangement, the OIG found safeguards sufficient to reduce the risk that the remuneration was intended to generate referrals of Federal health care program business and concluded it would not subject the hospital to sanctions.