OIG Approves Per Diem Call Pay Arrangement

January 31, 2013

OIG Advisory Opinion No. 12-15 has approved an existing arrangement under which a hospital pays physicians a per diem fee for providing on call ER coverage.

Under the arrangement, the hospital pays per diem fees to 130 specialty physicians on staff who provide on-call services, including:

  • telephone consultations;
  • in-person consultations, as well as any resulting inpatient services; and
  • follow-up care.

The per diem arrangement is available to all specialty physicians who have unrestricted call arrangements; meaning they can get to the hospital that contains an automatic renewal provision. Each year, the hospital sets aside aggregate annual payment amounts for each specialty involved in the on-call arrangement. The aggregate amount is then divided by 365 to determine the per diem payment, and participating physicians receive payments even if their on-call services are not required by the emergency department.

Payments are based on the expected number of days per month that each specialty will be needed; the expected number of patients each specialist will see on a daily basis; and the expected number of patients who will require inpatient services, as well as follow-up care.

An evaluation of the hospital’s per diem payments by an independent consultant determined they were commercially reasonable and at fair market value, and the hospital said the per diem rate is not influenced by the volume or value of any referrals generated by the specialty physicians.

According to the OIG, the arrangement presented limited opportunities or risks for fraud and abuse because:

  • the hospital affirmed that the per diem payments were both commercially reasonable and priced at fair market value;
  • the per diem amount is calculated on an annual basis and applies to all participating physicians, regardless of whether they refer patients to the hospital;
  • physicians participating in the arrangement provide services for which they would otherwise not be paid, including inpatient services and follow-up care;
  • the per diem arrangement is open to all specialty physicians who can take unrestricted calls; and
  • the hospital handles all costs of the arrangements with no portion being billed to any federal health care program.

 

Previous post:

Next post: